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Japan Trade Agreement Negotiating Objectives Released

Thursday, December 27, 2018
Sandler, Travis & Rosenberg Trade Report

The Office of the U.S. Trade Representative released Dec. 21 its negotiating objectives for a U.S. trade agreement with Japan. Formal discussions with Japan can begin as early as 30 days after the issuance of the negotiating objectives, as provided under the Bipartisan Congressional Trade Priorities and Accountability Act of 2015.

The notification to Congress from USTR states that the U.S. will seek to reduce both tariff and non-tariff barriers and achieve fairer and more balanced trade with Japan. The U.S. intends to improve its trade balance and reduce its trade deficit with Japan, increase transparency in import and export licensing procedures, and discipline import and export monopolies to prevent trade distortions.

With regard to trade in industrial goods, the U.S. will seek comprehensive duty-free treatment for U.S. industrial goods, including textile and apparel products, and expand market access for remanufactured goods exports by ensuring that they are not classified as used goods that are restricted or banned. Additional provisions will be sought to obtain fair and more equitable trade in the motor vehicle sector, including provisions to address non-tariff barriers in Japan. Furthermore, commitments will be secured with respect to greater regulatory compatibility to facilitate U.S. exports in key goods sectors such as pharmaceuticals, medical devices, cosmetics, information and communication technology equipment, motor vehicles, and chemicals.

On customs procedures, the U.S. will seek to increase regulatory transparency and ensure that, to the greatest extent possible, shipments are released immediately after determining compliance with applicable laws and regulations. Additional objectives in this area include providing for streamlined and expedited customs treatment for express delivery shipments, providing for simplified customs procedures for low-value goods and a more reciprocal de minimis shipment value, and ensuring that Japan administers customs penalties in an impartial and transparent manner.

Other specific negotiating objectives set forth in USTR’s notification include ensuring that Japan avoids manipulating exchange rates in order to prevent effective balance of payments adjustment or to gain an unfair competitive advantage, providing a mechanism to ensure transparency and take appropriate action if Japan negotiates an FTA with a non-market country, strengthening existing procedures and creating new procedures to address antidumping and countervailing duty evasion, and requiring the adoption or maintenance of requirements for companies to maintain accurate books and records to facilitate the detection and tracing of corrupt payments.

For more information on these negotiating objectives, please contact Nicole Bivens Collinson at (202) 730-4956.

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