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Legislative Update: TPA Still in Limbo; New Bills on Textiles, ITDS, Harbor Fees, GSP

Wednesday, September 25, 2013
Sandler, Travis & Rosenberg Trade Report

Trade issues have not been much of a priority for lawmakers after their return to Washington earlier this month. Supporters and opponents of trade promotion authority have been busy making their cases but little else appears to be going on. Other trade-related issues have been the subject of newly introduced bills, but given that congressional priorities lie elsewhere few if any of them are likely to be taken up in the near future.

Trade Promotion Authority. President Obama said recently that TPA (also known as “fast track”) is needed to implement the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership agreements currently under negotiation. However, some lawmakers are working to generate opposition to TPA in the belief that Congress should not cede its constitutional authority to regulate commerce. In the past TPA legislation has typically been used to set congressional priorities before major trade negotiations were initiated, whereas the TPP talks are nearing conclusion and the TTIP talks are already getting underway without any such formal direction having been given. Business groups who favor TPP and TTIP are still hopeful that TPA can be introduced and passed this year, but efforts among key lawmakers to develop a bill are reportedly making little progress.

Trade Preferences. Legislation to reauthorize the Generalized System of Preferences, which expired July 31, through September 2015 has been introduced in both the House (H.R. 2709) and Senate (S. 1331). However, Sen. Tom Coburn has objected to a unanimous consent agreement to pass the Senate bill because it includes what he calls “budget gimmicks” to offset the loss of duty revenue. As a result, there is little indication of any imminent movement on either of these measures.

The Andean Trade Preference Act also expired July 31 and appears unlikely to be resurrected. Ecuador was the only one of the four original beneficiaries still participating but had been accused of violating the ATPA’s eligibility requirements. Imports from Ecuador will remain eligible for duty preferences under GSP if and when it is reauthorized.

Customs. A temporary funding bill introduced by House Appropriations Committee Chairman Hal Rogers in an effort to avoid a government shutdown at the end of September includes a provision allowing funding flexibility for U.S. Customs and Border Protection to maintain current staffing levels and border security operations. CBP officials have warned that without this flexibility federal spending cuts (sequestration) that took effect March 1 could have negative impacts such as delays in conducting cargo exams, issuing advice and rulings and rolling out new functionality under the Automated Commercial Environment.

Farm Bill. The U.S. Chamber of Commerce, the National Association of Manufacturers and the National Foreign Trade Council wrote to House and Senate leaders on agriculture earlier this month expressing concern that provisions in the Farm Bill now under consideration could expose U.S. companies to trade retaliation by other countries. They pointed out that these provisions “run the substantial risk” of violating the same obligations the U.S. was found to have violated in a WTO dispute with Brazil over cotton subsidies and could “quickly invite other nations” to file their own WTO cases, which would have “a good chance of success.” The letter added that such action “could endanger hundreds of millions of dollars in U.S. exports and thousands of American jobs” based on the results of retaliation against the U.S. in other WTO cases.

Other. Following is a list of additional trade-related legislation that has been introduced recently. The texts of these bills are or will shortly be available on the Library of Congress Web site.

H.R. 2856 – to amend the Lacey Act Amendments of 1981 to prohibit the importation, exportation, transportation, sale, receipt, acquisition and purchase in interstate or foreign commerce, or in a manner substantially affecting interstate or foreign commerce, of any live animal of any prohibited wildlife species (introduced July 30 by Rep. Fitzpatrick, referred to House Committee on Natural Resources)

S. 1412 – to provide the Department of Homeland Security, U.S. Customs and Border Protection and the Department of the Treasury with authority to more aggressively enforce customs and trade laws relating to textile and apparel articles (introduced July 31 by Sen. Hagan, referred to Senate Committee on Finance)

H.R. 3004 – to amend the Tariff Act of 1930 to ensure that each federal agency participating in the International Trade Data System develops and maintains the necessary information technology infrastructure to support the operation of the system (introduced Aug. 2 by Rep. Bera, referred to House Committee on Ways and Means)

S. 1505 – to amend the Toxic Substances Control Act to clarify the jurisdiction of the Environmental Protection Agency with respect to certain sporting good articles and to exempt those articles from definition under that Act (introduced Sept. 17 by Sen. Thune, referred to Senate Committee on Environment and Public Works)

S. 1509 – to replace the Harbor Maintenance Tax with a maritime goods movement user fee in an effort to discourage shippers from diverting U.S.-bound goods through Canadian or Mexican ports (introduced Sept. 17 by Sen. Murray, referred to Senate Committee on Finance)

H.R. 3115 – to amend the Small Business Jobs Act of 2010 to extend and expand the State Trade and Export Promotion Grant Program (introduced Sept. 17 by Rep. Kuster, referred to House Committee on Small Business)

S. 1533 – to end offshore tax abuses (introduced Sept. 19 by Sen. Levin, referred to Senate Committee on Finance)

H.R. 3147 – to amend the Federal Food, Drug and Cosmetic Act to strengthen requirements related to nutrient information on food labels (introduced Sept. 19 by Rep. Pallone, referred to House Committee on Energy and Commerce)

H.R. 3167 – to prevent the president from granting Generalized System of Preferences eligibility to countries that block U.S. exports by requiring products to be manufactured domestically or failing to protect intellectual property rights (introduced Sept. 20 by Rep. Terry, referred to House Committee on Ways and Means

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