Now let's take a look at Section 301 of the Trade Act of 1974, which is at the center of the growing tensions.

The law stipulates that the US president can react to unjustifiable trade practices by a foreign country or organization. American firms and industry groups can also file petitions to trigger Section 301 cases. If unreasonable trade practices are found, the US can then suspend or withdraw benefits of trade agreement concessions. The US can also impose duties or other restrictions. Negotiations or a settlement with the violating entity, can take the form of compensation, or the elimination of trade barriers. The US also has the right to restrict market access to the service industry.

The US has frequently initiated Section 301 investigations. Those cases specifically targeted Canada, Japan, and the European Commission. Members of the World Trade Organization have challenged Section 301, saying it's contrary to the WTO agreement.