Comments on the Recent USTR Tariff Action - Great Scott Gadgets

Great Scott Gadgets

Comments on the Recent USTR Tariff Action

In September I made the following public comment on the Office of United States Trade Representative’s (USTR) Proposed Modification of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.

Thank you for requesting comments on the proposed supplemental action in response to China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation (USTR-2018-0026).

As the founder and owner of Great Scott Gadgets, a Colorado small business that puts open source tools into the hands of innovative people, I urge you to refrain entirely from imposing any new duty increases. Additionally I urge you to eliminate all recent increases made as a part of this action.

Due to the inclusion of multiple tariff subheadings in the proposal, I anticipate that Great Scott Gadgets will suffer a significant increase in the cost of products we sell. Ultimately the technological innovators who are the end users of our products will bear this increase. Instead of punishing China, the increased duties will harm American innovators who rely on tools such as ours. Innovators in China and elsewhere around the world will gain an advantage over Americans as a result of the action.

Great Scott Gadgets designs and manufactures open source hardware (OSHW). The OSHW community includes a rapidly growing group of companies committed to the ideals that end users have a right to fully control their own equipment and that anyone should be able to study, make, use, modify, and sell devices based on our published designs. OSHW makers recognize that, just as open source software has resulted in great advances in the software industry, open source hardware will enable future generations of hardware innovation.

The growth of Great Scott Gadgets and other open source hardware and software companies demonstrates that protection of intellectual property is unnecessary for commercial success in technological markets. This undermines the USTR’s argument that “China’s acts, policies, and practices that effectuate technology transfer burden and restrict U.S. commerce.”

I maintain that open source technology greatly enhances innovation and that the best way to foster rapid development of new technology is to encourage both the free exchange of ideas and free trade of tools, materials, and all goods.

In my opinion, the proposed supplemental action will have little effect on China’s acts, policies, or practices but will disproportionately harm Great Scott Gadgets, our employees, our American resellers, and the American innovators who depend on our tools.