Implementing The United States–Japan Agreement

9/4/2025

Executive Orders

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Action Summary

Purpose and Background: Implements the U.S.–Japan Agreement announced on July 22, 2025, aimed at addressing the U.S. trade deficit, bolstering national security, and strengthening the manufacturing and defense industrial base by leveling the playing field for American producers.
Tariff Framework:
- Imposes a baseline 15% tariff on nearly all Japanese imports, with adjustments based on current ad valorem rates under the Harmonized Tariff Schedule (HTSUS).
- For products with a current duty rate less than 15%, the additional tariff brings the rate to 15%; products at or above 15% incur no extra tariff.
Sector-Specific Adjustments:
- Aerospace: Tariffs on civil aircraft products (excluding unmanned aircraft) under previous orders and proclamations are removed.
- Automobiles and Automobile Parts: Additional tariffs under Section 232 are recalibrated using the product’s Column 1 Duty Rate with similar treatment to the general tariff framework.
Exemptions: Allows modification of reciprocal tariffs to zero percent for Japanese products that are:
- Natural resources unavailable or unsupplied domestically
- Generic pharmaceuticals and their ingredients
- Chemical precursors
Japan’s Commitments:
- Provides enhanced market access for U.S. producers in manufacturing, aerospace, agriculture, food, energy, and industrial goods.
- Commits to a 75% increase in U.S. rice procurements and an annual $8 billion purchase of U.S. agricultural products.
- Agrees to purchase U.S.-made commercial aircraft, safety-certified vehicles, and defense equipment.
- Invests $550 billion in the United States, intended to create jobs and expand domestic manufacturing.
Monitoring and Modification:
- The Secretary of Commerce, in consultation with other officials, will monitor Japan’s progress in fulfilling its commitments.
- The order may be modified if Japan fails to comply, ensuring alignment with national security and economic priorities.
Implementation and Delegation:
- Authority is delegated to the Secretaries of Commerce and Homeland Security, along with other agencies, to implement and make necessary tariff modifications via the HTSUS.
- Provides for temporary suspension, amendment of regulations, and redelegation of functions as needed.
Interaction with Prior Actions: Supersedes any previous proclamations or Executive Orders that conflict with the provisions of this order.

Risks & Considerations

The implementation of the United States-Japan Agreement introduces a new tariff framework that could impact the cost of Japanese imports, potentially affecting research and procurement costs for Vanderbilt University, especially in sectors like technology and pharmaceuticals.
The agreement’s focus on boosting American manufacturing and reducing the trade deficit may lead to changes in federal funding priorities, which could impact grants and research funding available to the university.
Japan’s commitment to invest $550 billion in the United States could create opportunities for partnerships and collaborations, particularly in research and development, which Vanderbilt could leverage to enhance its programs and infrastructure.
The potential for increased market access for American products in Japan may open new avenues for international collaboration and exchange programs, benefiting Vanderbilt’s global engagement strategies.
Changes in tariffs and trade policies could affect the supply chain and availability of certain goods, necessitating adjustments in procurement strategies for university departments reliant on Japanese products.

Impacted Programs

Vanderbilt’s Research Departments may need to assess the impact of tariff changes on the cost and availability of imported research materials and equipment from Japan.
The Office of Global Strategy could explore new opportunities for international partnerships and student exchange programs with Japanese institutions, leveraging the increased market access and investment commitments.
Vanderbilt’s Business School might see increased interest in courses related to international trade and economics, as students seek to understand the implications of such agreements on global markets.
The Procurement Office may need to adjust its strategies to account for changes in import costs and availability of Japanese goods, ensuring continuity in university operations.

Financial Impact

The introduction of a 15 percent tariff on Japanese imports could increase costs for departments relying on these goods, potentially impacting budget allocations and financial planning.
Japan’s investment in the United States presents potential funding opportunities for research and development projects, which Vanderbilt could pursue to enhance its academic and infrastructural capabilities.
Changes in trade policies may influence the availability and pricing of goods, affecting the university’s procurement strategies and financial management.
Increased market access for American products in Japan could lead to new revenue streams and collaborative ventures, benefiting Vanderbilt’s financial outlook.

Relevance Score: 3 (The order presents moderate risks involving compliance and potential impacts on procurement and funding strategies.)

Key Actions

Vanderbilt’s Office of Federal Relations should closely monitor the implementation of the United States-Japan Agreement, particularly the changes in tariffs and market access for American products. This will be crucial in understanding how these changes might impact Vanderbilt’s research and development initiatives, especially in sectors like aerospace and pharmaceuticals.
The Vanderbilt Center for International Business should evaluate the potential impacts of the new tariff framework on international trade and economic relations. By analyzing these changes, the center can provide insights into how Vanderbilt can adapt its international business strategies and partnerships.
Vanderbilt’s School of Engineering should explore opportunities for collaboration with Japanese companies, particularly in the aerospace and automobile sectors. The increased market access and investment from Japan could lead to new research partnerships and innovation projects.
The Vanderbilt Institute for Global Health should assess the implications of the agreement on the availability and pricing of generic pharmaceuticals. Understanding these changes will be essential for adapting health policy research and advocacy efforts.
Vanderbilt’s Economic Development Office should identify potential opportunities arising from Japan’s $550 billion investment in the United States. By engaging with relevant stakeholders, the office can position Vanderbilt to benefit from these investments, potentially leading to new funding and collaboration opportunities.

Opportunities

The agreement presents an opportunity for Vanderbilt’s Agricultural Research Program to expand its research and development of agricultural products, particularly in areas like rice, corn, and soybeans. By leveraging its expertise, Vanderbilt can contribute to the design and evaluation of effective agricultural trade strategies.
Vanderbilt can capitalize on the increased focus on aerospace and defense equipment by developing new programs and partnerships with Japanese companies. This could include joint research initiatives, student exchange programs, and collaborative curriculum development, enhancing Vanderbilt’s reputation and reach in the aerospace sector.
The emphasis on supporting American manufacturing and job creation offers an opportunity for Vanderbilt’s Center for Workforce Development to engage in policy analysis and advocacy. By providing evidence-based recommendations, the center can influence how these investments are allocated and used to support economic growth and job creation.
The order’s focus on improving trade relations with Japan aligns with Vanderbilt’s commitment to global engagement and diversity. The university can develop targeted outreach and support programs for Japanese students and researchers, enhancing their educational opportunities and success.
By engaging with the broader international trade community and policymakers, Vanderbilt can position itself as a leader in the national conversation on trade reform. Hosting conferences, workshops, and public forums on the implications of the United States-Japan Agreement can further establish Vanderbilt as a hub for innovative trade thought and practice.

Relevance Score: 4 (The agreement presents the potential for major process changes required for Vanderbilt’s programs due to impacts on trade, research, and international collaboration.)

Average Relevance Score: 4.4

Timeline for Implementation

Within 7 days after publication in the Federal Register, the Secretary (in consultation with relevant officials) must publish a notice modifying the HTSUS for both Aerospace (Sec. 3(b)) and Automobiles/Automobile Parts (Sec. 4(b)).
Retroactive application effective August 7, 2025 for tariff adjustments as products are entered for consumption or withdrawn from warehouse (Sec. 2(d)).

No additional deadlines were noted that are shorter or more urgent than the 7-day requirement, which we identified by analyzing the specific sub-sections with defined timeframes.

Relevance Score: 5

Impacted Government Organizations

Department of Commerce: Tasked with implementing the tariff modifications by determining ad valorem rates pursuant to the HTSUS and publishing necessary changes in the Federal Register.
Department of Homeland Security (DHS): Through its Commissioner of U.S. Customs and Border Protection (CBP), DHS is responsible for enforcing the new tariff measures and processing refunds as well as consulting on modifications to the HTSUS.
U.S. Trade Representative (USTR): Collaborates with the Secretary of Commerce to determine tariff adjustments and ensure that trade measures align with U.S. national interests.
U.S. International Trade Commission (ITC): Involved in consulting on and verifying modifications to the HTSUS, ensuring that trade policies are effectively implemented.
All Executive Departments and Agencies: As stated in the order, these bodies must take necessary actions to implement the order’s provisions, reflecting its broad impact across the federal government.
Office of Management and Budget (OMB): Its functions are noted in relation to budgetary oversight and the administrative execution of policy, ensuring alignment with broader federal fiscal responsibilities.

Relevance Score: 5 (The order applies broadly across the entire federal executive branch, impacting numerous agencies and departments.)

Responsible Officials

Secretary of Commerce – Responsible for coordinating tariff modifications through rulemaking, including publishing notices in the Federal Register and determining necessary modifications to the Harmonized Tariff Schedule.
Secretary of Homeland Security – Required to consult with other officials and exercise delegated authority regarding modifications to tariff classifications, as well as ensuring overall implementation of the order.
Commissioner of U.S. Customs and Border Protection (CBP) – Acts in consultation with the Secretaries to implement tariff adjustments and process refunds according to established procedures.
Chair of the U.S. International Trade Commission (ITC) – Consulted for determining necessary modifications to the HTSUS and for coordinating with other agencies on the regulatory framework.

Relevance Score: 5 (This directive impacts Cabinet officials, including the heads of key agencies responsible for trade and border security.)