Background

The U.S. and Brazil signed Oct. 19 a protocol updating their 2011 agreement on trade and economic cooperation to establish common standards on efficient customs procedures, transparent regulatory development, and anti-corruption policies. A joint statement said this protocol sets the stage for future discussions and that efforts will be made to identify priority sectors to further reduce barriers to bilateral trade, which totaled $105.1 billion in 2019.

However, House Ways and Means Committee Chair Richard Neal, D-Mass., and Trade Subcommittee Chair Earl Blumenauer, D-Ore., criticized the Trump administration for going ahead with the agreement despite opposition from Democrats, who have registered concern about Brazilian President Jair Bolsonaro’s record on human rights, the environment, and corruption. Blumenauer added that the White House’s history of negotiating “mini agreements” on trade with other countries without congressional approval “may force a rebalancing” of the trade authority powers Congress has delegated to the executive branch.

According to a fact sheet, the protocol includes the following with respect to customs administration and trade facilitation.

- online publication of customs and other border information, including practical steps for import, export, and transit; current duties, taxes, and fees imposed at the border; requirements related to customs brokers; and procedures to correct errors

- single window for import, export, and transit

- electronic systems for traders, including submission of customs declarations and related documentation

- acceptance of electronic documents under specific international standards, including e-Phyto electronic phytosanitary certificate

- joint work plan to advance authorized economic operator mutual recognition agreement

- new article to promote appropriate border treatment for agricultural and other goods vulnerable to deterioration, including review of entry process requirements

- broad scope for advance rulings, including classification, valuation, origin, and application of quotas

- mechanisms to help ensure consistent customs treatment from port to port, including through advance rulings and administrative guidance

- prohibition on consular transactions in connection with importation

- disciplines on penalties, including no penalties on minor errors (unless part of a consistent pattern) and procedures to allow correction of errors without penalties

- expanded customs cooperation, including on trade enforcement

The annex on good regulatory practices, only the second U.S. agreement of its kind after the U.S.-Mexico-Canada Agreement, includes the following.

- online publication of draft regulations, opportunity to comment, and appropriate consideration of comments

- a web site with information about plans for regulating, regulations being developed, and regulators’ specific responsibilities

- encourages the use of a regulatory impact assessment to evaluate draft regulations, including examination of the positive and negative impact of regulations and feasible and appropriate alternatives

- review of regulations to assess effectiveness and identify opportunities to reduce burden

- encourages regulatory authorities to use reliable, high-quality information and to be transparent about the source of information used

- recognizes the role of advisory groups, public notice of the membership and activities of advisory groups, and the opportunity to provide input on topics under their mandate

Finally, the anti-corruption commitments include the following.

- adopting and maintaining measures to prevent and combat bribery and corruption

- precluding the tax deductibility of bribes

- measures regarding the recovery of proceeds of corruption and the denial of a safe haven for foreign public officials that engage in corruption

- effective, persuasive sanctions for corrupt acts

- rules for integrity in maintaining financial records, including financial statement disclosure and auditing requirements

- procedures to report corrupt acts and protection for persons who report corruption

- policies and procedures to promote accountability of public officials

- participation of the public sector and civil society in the effort to prevent and combat bribery and corruption

Copyright © 2020 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

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