US Commences Section 232 Investigations on 2025 Semiconductor, Pharmaceutical Imports

President Donald Trump’s administration has launched probes into semiconductor and pharmaceutical imports. The US Section 232 investigations 2025 are aimed at introducing tariffs in the two sectors, Reuters reported. The new tariffs are part of President Donald Trump’s latest move to use the Trade Expansion Act of 1962 to justify sectoral tariffs.

Notices of Probe

The government filed notices of the probes on the Federal Register on April 14. The filings show that investigations commenced on April 1. The notices mark the start of a 21-day period to receive public comments. The new tariffs will be based on America’s concerns that extensive dependence on foreign-produced chips and drugs poses a national security threat. According to Trump, chip levies under national security are aimed at increasing local production of products that are vital to the US.

Through the Trump metal tariff investigations, the US government will be probing importation of lumber and copper from America’s trade partners. Investigations conducted during President Trump’s first term were the basis for the 25% duty on aluminum, steel, and auto industry that the regime announced in January.

The US semiconductor investigation comes days after the US exempted computers, smartphones and other electronics from the 125% reciprocal tariffs. The US mostly imports these products from China. Officials from the Trump administration say the US will be subjecting these products to tariffs in the coming weeks. Section 232 investigations must be finalized within 270 days.

US Dependence on Taiwan

The US relies on semiconductors from Taiwan and other Asian countries. The Biden administration attempted to reverse this situation by offering chip makers billions of dollars in Chips Act funding to expand manufacturing in the US. On April 13, President Trump said tariffs on semiconductors will be announced next week. He said the US will offer more flexibility to some firms in the sector.

The latest notice includes US pharmaceutical investigations targeting both pharmaceutical ingredients and other derivative products. Pharmaceutical companies argue that Trump tariffs may result in shortages and reduced drug access for patients. But the US President continues to push for the duty, arguing that America needs more pharmaceuticals to reduce its reliance on other countries.

Big drug manufacturers have global footprints across Europe, Asia, and the US. For many of them, shifting production functions to the US requires huge investments and it could take years for them to do so.

Bracing for Tariff Announcement

Industry players have advocated for a phased tariff rollout on pharmaceutical imports to reduce impact of the changes and support the shift in production. Analysts say the 21-day notice gives companies an indication of when tariffs could commence.

“This notice gives us some breathing room and visibility on when the tariffs might be expected, and we will be certainly looking out for the lobby actions that PHRMA and the industry CEOs will be engaging in over the next three weeks. We are bracing for announcement of tariffs around mid-May and see tariffs of 10-25% as being possible, with the industry angling for a slow ramping to these tariffs and potential carve-outs,” Courtney Breen, Bernstein Analyst said.
Lobby groups say that Trump’s recent decision to halt tariffs on electronics and semiconductors was an acknowledgment that his tariffs are hurting consumers.

“At the same time, the shift from IEEPA to Section 232 as a legal basis for tariffs reveals the Administration’s desire for a more durable justification. But claiming that downstream consumer tech products qualify as ‘semiconductors’ is a stretch,” Gary Shapiro, CEO and Vice Chair of the Consumer Technology Association said.

Trump has made tariffs a critical part of his administration’s national security and economic policies. The administration has been aggressive in introducing tariffs against traditional trading partners, raising import duties to a high of 25%, up from 2.5% within months. In recent weeks, the tariffs have caused turmoil in the financial markets, pushing stock indexes down 10% since Trump’s election in November 2024.