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Legislative Update: Tariffs, Japan Agreement, Origin Labeling, Export Finance, Cosmetics

Tuesday, November 19, 2019
Sandler, Travis & Rosenberg Trade Report

For more information on pursuing trade policy interests through the legislative process, please contact trade consultant Nicole Bivens Collinson at (202) 730-4956.

Section 232 Tariffs. Senate Finance Committee Chairman Chuck Grassley, R-Iowa, said recently that he still wants to advance legislation that would reform Section 232 of the Trade Expansion Act of 1962, which allows the president to impose national security-related tariffs without congressional input. Grassley said that he has been working for nearly a year to “establish separation-of-powers and checks-and-balances in the 232 process” but that “every time we get close to marking up a Section 232 bill, Senator Wyden hears from stakeholders who are profiting from tariff protection.”

Grassley said he has also heard from other senators expressing concern that President Trump “won’t like us taking away his tariff law.” However, he responded that “reforming Section 232 is not about President Trump,” who “merely followed the law” in imposing Section 232 tariffs on steel and aluminum products and in so doing “alerted us to the fact that Congress has been too negligent in the past of protecting our constitutional responsibility … over international trade.” Grassley added that reforming this trade law would “make it clearer to our trading partners that when section 232 is used, Congress stands with the President.”

Grassley also said he recognizes the need for compromise in advancing a Section 232 reform bill and has therefore “agreed to Senator Wyden’s request to introduce a Chairman and Ranking Member’s mark that does not unwind the Section 232 measures on steel and aluminum.”

Japan. The House Ways and Means Trade Subcommittee will hold a hearing Nov. 20 to discuss the U.S.-Japan agreements on trade in agricultural, industrial, and digital goods as well as prospects for a second phase of negotiations for a bilateral agreement to cover trade in a comprehensive manner.  Written comments for the hearing record are due by Dec. 4.

Origin Labeling. H.R. 5088 (introduced Nov. 14 by Rep. Cook, R-Calif.) would make exclusive the authority of the federal government to regulate the labeling of products made in the U.S. and introduced in interstate or foreign commerce.

Export Finance. The House of Representatives approved Nov. 15 the U.S. Export Finance Agency Act (H.R. 4863), which would rename the Export-Import Bank of the U.S. as the U.S. Export Finance Agency, reauthorize it for ten years, and make a number of reforms. However, the White House said in a Nov. 14 statement of administrative policy that President Trump’s advisors would recommend he veto this bill if it were presented to him in its current form. The statement explained that the bill “would create excessive costs and burdensome reporting structures, which could delay project approval and implementation,” particularly with respect to energy.

Cosmetics. The Natural Cosmetics Act (H.R. 5017, introduced Nov. 8 by Rep. Maloney, D-N.Y.) would amend the Federal Food, Drug, and Cosmetic Act to treat cosmetics with packaging or labeling using the term “natural” as misbranded unless the product meets certain standards. Cosmetic products would have to contain at least 70 percent natural substances, excluding water, to be sold, labeled, or represented as “natural.” The bill would also give the Food and Drug Administration authority to issue a cease distribution order, public notice on the FDA website, and voluntary recall authority of any product deemed misbranded under this act. 

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