Background

Legislation introduced in the House Jan. 25 would reinstate import duty breaks for thousands of products but would also impose significant new restrictions on trade that could have long-lasting impacts. The bill is expected to move quickly through the legislative process so affected companies should act now to seek any desired changes. For more information, please contact Nicole Bivens Collinson at (202) 730-4956 or via email.

The American Worker and Trade Competitiveness Act, part of the America COMPETES Act, includes the following measures.

GSP – (1) reauthorizes the Generalized System of Preferences through Dec. 31, 2024, retroactive to Dec. 31, 2020, (2) adds new eligibility criteria on the environment, human rights, rule of law, poverty reduction, and anti-corruption, (3) allows interested persons to petition at any time for a review of a beneficiary country’s compliance with the eligibility criteria, (4) requires country eligibility reviews every three years, and (5) requires a study on rules of origin, women’s economic empowerment, and GSP utilization rates to help least-developed countries receive more program benefits

MTB – (1) authorizes duty suspensions and reductions for imports of products included in the most recent miscellaneous tariff bill through Dec. 31, 2023, with some exceptions, (2) makes those actions retroactive to four months before the bill’s enactment, (3) reauthorizes the MTB process for two more cycles (beginning in 2022 and 2025), and (4) excludes finished products from being included in future MTBs

De minimis – (1) prohibits goods from countries that are both non-market economies and on the U.S. trade representative’s priority watch list for intellectual property rights violations (e.g., China) from utilizing the de minimis exception from import duties (but does not include an exclusion of goods subject to Section 301 or Section 232 tariffs), (2) requires U.S. Customs and Border Protection to collect more information on all de minimis shipments, (3) requires CBP to prohibit importers that have been suspended or debarred from using the de minimis exception, and (4) simplifies CBP’s requirements for processing goods that receive de minimis treatment upon importation but have been detained by CBP

Trade remedies – strengthens AD/CV laws by (1) giving the Department of Commerce authority to apply CV duty law to subsidies provided by a government to a company operating in a different country (third country subsidization), such as those provided under China’s Belt and Road Initiative, (2) creating a new successive AD/CV investigation to combat repeat offenders by making it easier for petitioners to bring new cases when production moves to another country, and (3) imposing statutory requirements for the process and timeline of inquiries into circumvention of AD/CV duty orders

Foreign investment – empowers the federal government to review and potentially block certain outbound investments made by U.S. companies by establishing a process to review the offshoring of critical capacities and supply chains to foreign adversaries and non-market economies

Trade Adjustment Assistance – (1) restores funding for TAA programs that were cut in half in 2021 and will expire in July 2022, (2) includes higher funding levels, (3) expands eligibility for entities to receive TAA, and (4) modernizes several TAA program

We understand that amendments to this bill are due by Jan. 28 and a chairman’s mark is expected, meaning the above provisions and others are subject to change. The bill is expected to move quickly in the House followed by a conference to resolve differences with the Senate-passed U.S. Innovation and Competition Act.

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