Legislative Update: Trade Agreements, Trade Remedies, Offshoring, Sanctions
North Korea. The House Foreign Affairs Committee approved March 29 the Korean Interdiction and Modernization of Sanctions Act (H.R. 1644), which includes the following provisions.
- authorizes enhanced screening of inbound cargo that has transited any of the foreign seaports or airports found to have failed to inspect or seize the cargo of North Korean ships or aircraft as required by United Nations Security Council resolutions
- prohibits goods produced in whole or part by North Korean forced labor from entering the U.S.
- expands the ability to sanction those who import North Korean coal, iron, or iron ore above the limits imposed by UNSC resolutions, buy textiles or fishing rights from North Korea, facilitate the online business activities of the North Korean regime, or fail to comply with UNSC resolutions targeting North Korea
- prohibits any ships owned by the government of North Korea or owned or operated on behalf of any country not complying with UNSC resolutions from operating in U.S. waters or landing at any U.S. port
- mandates sanctions against any foreign person who buys certain metals or minerals from North Korea or provides certain types of military-use fuel or insurance or reinsurance to vessels sanctioned under a UNSC resolution for engaging in illicit trade with North Korea
Asia. H.Res.236 (introduced March 30 by Rep. Yoho, R-Fla.) calls on the president to consult with Congress on opportunities to promote further economic and commercial activity between the U.S. and Japan and to commence negotiations toward a trade agreement with Japan as soon as appropriate.
H.Res.271 (introduced April 7 by Rep. Ed Royce, R-Calif.) encourages the Office of the U.S. Trade Representative to commence negotiations on a bilateral trade agreement with Taiwan.
Offshoring. The Corporate Expatriates and Inverters Tax Fairness Act (H.R. 1931, introduced April 5 by Rep. Doggett, D-Texas) would (a) apply an exit tax to any U.S. firm changing to foreign control and (b) tighten restrictions on corporate inversions, including increasing the threshold of foreign ownership required to accomplish the inversion for tax purposes.
The Stop Tax Haven Abuse Act (H.R. 1932, introduced April 5 by Rep. Doggett) would eliminate tax incentives for U.S. companies to move jobs and operations offshore and close loopholes that allow large multinationals to avoid taxes by shifting profits to offshore tax havens.
The Offshoring Prevention Act (H.R. 2005, introduced April 6 by Rep. Cicilline, D-R.I.) would prohibit companies from deferring income tax on profits earned from the manufacture of goods abroad for sale in the U.S.
Trade Remedies. The Currency Reform for Fair Trade Act (H.R. 2039, introduced April 6 by Rep. Levin, D-Mich.) would allow the Department of Commerce to impose countervailing duties to offset the impact of currency manipulation on a U.S. industry.
AGOA. The African Growth and Opportunity Act and Millennium Challenge Act Modernization Act (S. 832, introduced April 5 by Sen. Cardin, D-Md.) would give the Millennium Challenge Corporation the authority to develop concurrent compacts with one country if one or both of the compacts are for purposes of regional economic integration, increased regional trade, or cross-border collaborations and if the country has been able to demonstrate progress toward meeting objectives of the original compact and sufficient capacity to successfully handle additional compacts. This bill would also require the State Department to better promote AGOA with sub-Saharan African governments and businesses and direct the president to implement policies that facilitate regional trade among SSA countries and provide capacity building for companies and governments to improve AGOA utilization.