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Trade Preferences Restored for Three Countries, Suspended for One

Wednesday, December 27, 2017
Sandler, Travis & Rosenberg Trade Report

President Trump has issued a proclamation restoring or suspending trade preferences under the Generalized System of Preferences and the African Growth and Opportunity Act. The GSP changes will have little immediate practical effect because GSP itself expires Dec. 31, 2017.

The proclamation restores GSP eligibility for Argentina, which was suspended in 2012, as of Jan. 1, 2018. A press release from the Office of the U.S. Trade Representative explains that Argentina has resolved certain arbitral disputes with U.S. companies, made new commitments to improve market access for U.S. agricultural products, and improved its protection and enforcement of intellectual property rights. However, due to certain remaining IPR issues, GSP benefits for Argentina will not be restored for all eligible products.

The proclamation also restores the eligibility of The Gambia and Swaziland for AGOA, which will remain in effect through Sept. 30, 2025, despite the lapse of GSP. The Gambia lost its AGOA eligibility in 2015 due to human rights abuses and the deterioration of the rule of law, but USTR states that following democratic elections in December 2016 the country has made progress in strengthening the rule of law, improving human rights, and supporting political pluralism. Swaziland lost AGOA eligibility in 2015 due to concerns over restrictions on the freedoms of peaceful assembly, association, and expression, but USTR states that in November 2017 the country met the last in a series of benchmarks the U.S. set on these issues.

Finally, the proclamation will suspend GSP eligibility for Ukraine, which USTR states is due to Ukraine’s “failure to provide adequate and effective protection of intellectual property rights despite years of encouragement and assistance from the U.S. government.” However, the proclamation gives 120 days’ notice of this suspension because the government of Ukraine “has a viable path to remedy the situation, including improving the current legal regime governing royalty reimbursement to right holders’ organizations.”

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