Trade Compliance Center - Making America's Trade Agreements Work for You!

The U.S. International Trade Commission (USITC) has instituted an investigation at USTR’s request to assess the likely impact of a comprehensive bilateral trade promotion agreement (TPA) that the President has proposed to establish with Panama. The Trade Act of 2002 requires the ITC to prepare a report that assesses the likely impact of proposed free trade agreements on the U.S. economy as a whole and on specific industry sectors and the interests of U.S. consumers. The Commission will hold a public hearing in connection with the investigation on May 16, 2007. For information on the hearing and filing written submissions for the record, please consult the USITC press release.

After participating in a conference call with the President’s Export Council on April 24, Commerce Secretary Carlos M. Gutierrez issued a press release commending the Council for understanding the value of renewing Trade Promotion Authority (TPA), which he said “…is essential to keep this momentum going and to keep American companies competitive in global trade.” The Council advises the President through the Secretary on export enhancement and works with industry encouraging U.S. companies to increase exports and enter new markets. The Secretary stated, "Under President Bush’s leadership, we have implemented free trade agreements with 11 countries. Last year, export growth outpaced import growth and exports supported millions of high-paying U.S. jobs.”

On April 26, NSC officials Judy Ansley and Rod Hunter briefed the White House press corps on the April 30 U.S.-EU summit. Ms. Ansley stated that President Bush will welcome German Chancellor/EU President Angela Merkel and European Commission President Barroso to the White House for the summit, which she called “an opportunity for these leaders to discuss our strategic partnership and to explore ways that we continue to expand our areas of cooperation across a broad range of issues: economic, foreign policy and security.” In his discussion of the summit’s economic issues, Hunter stated that the WTO Doha Round “... is a top priority for the leaders. They each recognize the importance to continue global growth, but also, and especially for developing countries, of a successful Doha Round.” Transatlantic economic engagement and climate/energy security and economic growth will also be discussed, and Hunter anticipated that the leaders will discuss how innovation and technology can be used to solve the challenges posed by these three issues.

USITC Releases Report On Likely Effects of Duty-Free Entry for Goods Under GSP

On April 26, the U.S. International Trade Commission (USITC) released a public version of its confidential report on the probable economic effects of providing duty free treatment under the Generalized System of Preferences (GSP). The report, Advice Concerning Possible Modifications to the U.S. Generalized System of Preferences, 2006 Review, was requested by USTR. As requested, the Commission provided advice as to the impact of granting waivers of the competitive need limits for these countries and products: Argentina for lithium carbonates and calcium silicon (HTS subheadings 2836.91.00 and 7202.99.20); for Brazil for refined copper cathodes and certain unalloyed copper wire rod (HTS subheadings 7403.11.00 and 7408.11.60); for India for cucumbers, including gherkins, certain hand- hooked carpets and other textile floor coverings, and certain color television reception apparatus (HTS subheadings 2001.10.00, 5703.10.20, and 8528.12.80); and for Thailand for radial bus or truck tires (HTS subheading 4011.20.10). "Competitive need limits" represent the maximum import level of a product that is eligible for duty-free treatment under the GSP; once the limit is reached, trade is considered "competitive," benefits are no longer needed, and imports of the article become ineligible for GSP treatment, unless a waiver is granted.

View the text of Commerce Secretary Carlos M. Gutierrez’s remarks to the Council on Foreign Relations in New York City on April 23, in which he discussed how to secure the promise of the Western Hemisphere. In his speech, the Secretary stated that countries in the Western Hemisphere “…need to continue building a regional framework to improve standards of living, create prosperity and compete globally.” Mr. Gutierrez also discussed the need for “a sound, legal immigration policy,” in order to continue growing the U.S. economy, stating, “This can be our great competitive advantage for the next century.” He reiterated that first priority was, is and will continue to be the security of the American people, which includes securing borders, boosting interior enforcement and implementing a verification system.

USTR Cancels Hearing on Potential Withdrawal of Tariff Concessions and Increase in Applied Duties in Response to EU Enlargement

USTR has cancelled the April 24, 2007 public hearing concerning a list of goods for which tariff concessions may be withdrawn and duties may be increased in the event the United States cannot reach agreement with the EC for adequate compensation owed under WTO rules as a result of EU enlargement. USTR cancelled the hearing because all the respondents to a March 22 Federal Register notice seeking public comment on this issue chose to submit their comments in writing, and there were no requests to testify. The United States is continuing to negotiate with the EU regarding the EU’s provision of adequate and permanent compensation to the United States for an event that increased duties on U.S. imports to EU markets above WTO bound rates of duty. Questions should be directed to: Laurie Molnar, USTR’s Director for European Trade Issues, at (202) 395–3320.

Commerce Under Secretary Lavin Addresses California Council for International Trade

View the text of Under Secretary of Commerce for International Trade Franklin L. Lavin’s remarks at the California Council for International Trade’s 9^th Annual Trade Policy Forum on April 19. While noting that many of the companies in attendance at the forum helped to develop the technologies which are driving “a global revolution in international business practices,” Mr. Lavin cautioned “we may see protectionist backlash to the policies that support and sustain this movement, both in the U.S. and in other countries.” He also warned that other transnational threats may emerge to threaten this evolution. Mr. Lavin thanked California firms for their conviction and

“ … partnership, not only to keeping the American economy strong, but to enhancing global prosperity through trade.”

WTO: Director General Lamy Says “U.S. Leadership will be Key” to Fate of Doha Round

In a speech to the U.S. Chamber of Commerce in Washington on April 23, WTO Director-General Pascal Lamy said “U.S. leadership is always required to sustain the WTO but the exercise of this leadership by the Administration and Congress in the weeks and months ahead will be key to the fate of the Round.” Lamy added, “A breakthrough in the negotiations in the next few weeks would send a much needed message of confidence, that WTO members remain committed to open markets and multilateral rules and that the foundations of the global economy are reinforced.”

USTR announced April 12 that the WTO Appellate Body has upheld a U.S. statute concerning antidumping “sunset reviews,” which are used to determine whether duties on dumped imports should be continued and remain in place for up to an additional five years. The Appellate Body report reverses an earlier panel finding against the U.S. statutory provision, which gives foreign companies the choice to waive participation in certain sunset review proceedings. The Appellate Body finding confirms that the United States has properly implemented 2006 WTO rulings against the statute and related regulations. The finding does not affect an adverse panel finding that the United States did not appeal against a specific U.S. sunset review involving certain pipe from Argentina.

On April 13, Assistant Secretary of Commerce for Market Access and Compliance David Bohigian announced that 17 U.S. companies will join a Clean-Energy Technologies Trade Mission to India and China from April 18-25. The mission will aim to match U.S. companies with opportunities in these fast-growing markets, where American clean technology goods and services can help improve the environment. The 17 high-technology U.S. companies specialize in the renewable energy, energy efficiency, clean coal, and distributed generation sectors. They represent innovative solutions to China’s and India’s energy and environmental challenges and are potential partners to the countries’ business and government leaders, and range in size from fewer than five employees to thousands of employees. All companies belong to industries promoted by the Asia Pacific Partnership on Clean Development and Climate (APP). The APP is a Presidential initiative to achieve a reduction in the intensity of carbon dioxide and other greenhouse gas emissions and enhance energy security, in the context of sustained economic growth. For additional information regarding the Clean-Energy Technologies Trade Mission, including a full list of participants, visit www.export.gov/cleanenergymission. For additional information regarding APP, including a current funding opportunity, visit www.state.gov/app or www.asiapacificpartnership.org.

After meeting in India with trade ministers from Brazil, India and the EU on April 12, U.S. Trade Representative Susan Schwab said that developing countries have an opportunity to play a significant leadership role in the WTO Doha Round. But the leadership opportunities come with obligations as well, she stated, urging advanced developing countries to "lead by example." Expanding trade between developed industrial countries and developing countries will not fulfill the promise of the Doha Development Agenda framework agreement, Schwab noted. Rather, she said, trade must increase among developing countries to generate global economic development and alleviate poverty. While Schwab said she thought the trade ministers had brought a "sense of momentum" to the G-4 meeting, the first formal gathering of the group in several months, she added her hope that the gatherings also would reflect an increased "sense of urgency" about moving ahead with the trade talks.

India-United States: Nath and Schwab Pledge Increased Trade and Investment, Announce Formation of Private Sector Advisory Group

During the sixth Ministerial-level meeting of the U.S.-India Trade Policy Forum (TPF) on April 13, U.S. Trade Representative Susan C. Schwab and India’s Minister of Commerce and Industry Kamal Nath focused on a number of initiatives to strengthen bilateral trade ties and held in-depth trade policy discussions on tariff and non-tariff barriers, agriculture, investment, services, and intellectual property rights. They also announced the formulation of a Private Sector Advisory Group of U.S. and Indian international trade experts who will provide strategic recommendations and insights to the U.S.-India Trade Policy Forum. The United States and India maintain one of the world’s fastest growing major bilateral trade relationships and are committed to a goal of doubling bilateral trade to approximately US$ 60 billion by 2008. During the visit, Ambassador Schwab and Minister Nath also discussed the WTO Doha negotiations, agreeing that the United States and India share a commitment to conclude a successful, far-reaching Doha Round by the end of 2007. The next meeting of the Trade Policy Forum will be held in Washington, D.C., in the Fall of 2007.

In an April 9 press release, Commerce Secretary Carlos M. Gutierrez commented on the Bush Administration’s decision to request WTO dispute settlement consultations with the People’s Republic of China to assess certain aspects of China’s enforcement of intellectual property rights (IPR) and market access restrictions for publications, audiovisual and sound recording products. While noting that the United States “…would prefer to solve these issues through dialogue and negotiation, we have consistently demonstrated that we will not hesitate to pursue the WTO process to protect our rights and ensure China meets its WTO obligations.” The Secretary added, “We believe that bilateral dialogue and multilateral forums are both important tools for ensuring healthy and sustainable relations, and look forward to continuing our cooperative efforts on IPR and other trade issues in our bilateral discussions with China.”

On April 10, U.S. Trade Representative Susan C. Schwab announced the results of the 2007 annual review of the operation and effectiveness of telecommunications trade agreements under Section 1377 of the Omnibus Trade and Competitiveness Act of 1988 (“1377 Review”). This year’s 1377 Review focuses on country-specific concerns, as well as more general issues of concern. Those countries and issues where specific concerns arise include Egypt, Thailand, Jamaica, Mexico and Guatemala. This year’s Review also identified general issues of concern in several countries, including:

(1) barriers to the provision of satellite capacity; (2) barriers to the provision of Voice over Internet Protocol (VoIP) services; (3) limitations on access to and use of public telecommunications services (including leased lines); and (4) issues related to regulatory independence, transparency, and excessive market entry requirements. The Review also noted significant progress on issues identified in past years’ reviews in several key markets, including:

(1) Australia, which completed the privatization of its dominant operator; and (2) India, which took steps to enhance foreign direct investment in its market and address problems related to competitive access to submarine cables as well as continued its efforts to phase out its access deficit charge.

View a fact sheet prepared by the U.S. Commerce Department and the U.S. Chamber of Commerce to learn 10 steps to take to keep your business and home safe from fakes. According to the fact sheet, counterfeiting and piracy cost the U.S. economy between $200 billion and $250 billion per year, are responsible for the loss of 750,000 American jobs, and pose a threat to health and safety. The sale of these dangerous and defective goods has far-reaching consequences for our lives and our economy.

Commerce Under Secretary Lavin Discusses Business Opportunities in Afghanistan and Central Asia

View the text of Under Secretary of Commerce for International Trade Franklin L. Lavin’s remarks at the Business Opportunities in Afghanistan and Central Asia Conference in Washington on April 10. Mr. Lavin noted that the region is undergoing dynamic change and that increasingly offers strong prospects for trade and investment for American companies. At the same time, he commented, the countries of Central Asia do not currently offer the same scale of market opportunity as China. To improve their business climates, Mr. Lavin challenged Central Asian countries to take steps such as making border crossings and customs more efficient, streamlining tax codes, and strengthening the rule of law, inter alia.

In a declaration issued April 5 at the conclusion of the Fifth Global Forum on Fighting Corruption and Safeguarding Integrity, participants endorsed the United Nations Convention Against Corruption (UNCAC) as the “primary global framework for action and cooperation among governments and between governments, the private sector and other nonstate actors.” Joseph Gangloff, deputy director of the U.S. Office of Government Ethics and co-leader of the U.S. delegation to the Forum, said the gathering in Johannesburg provided “solid ground” for transition from the Global Forum process to follow up with the U.N. convention. The declaration called for “prompt ratification and accession to UNCAC.” The U.S. delegation, in an April 3 statement, said the United States is urging countries that have already ratified or signed the convention to complete a self-assessment checklist agreed on at the first meeting of the Conference of State Parties to the convention.

U.S. Trade Representative Schwab to Visit India April 12-15 to Advance Bilateral Trade

U.S. Trade Representative Susan C. Schwab will lead a high-level delegation to New Delhi on April 12-15 for strategic trade talks and bilateral discussions with senior Indian officials. Ambassador Schwab will co-chair the fourth Ministerial-level meeting of the U.S.-India Trade Policy Forum with India’s Minister of Commerce and Industry Kamal Nath. At the Forum, Ambassador Schwab will discuss initiatives to strengthen bilateral trade ties and achieve progress in the areas of agricultural trade, investment, trade in services, reduction of tariff and non-tariff barriers, and boosting innovation and creativity. While in India, Ambassador Schwab will hold in-depth discussions in New Delhi with senior Indian officials on the WTO Doha Development Agenda, and will also attend brief gatherings of the G-4 and G-6 trade ministers to do a stocktaking of progress in the Doha Round. The U.S.-India Trade Policy Forum was launched during the visit of Indian Prime Minister Dr. Manmohan Singh to Washington, D.C., in July 2005. The previous Ministerial-level Trade Policy Forum meeting was held in Washington in June 2006.

On April 9, U.S. Trade Representative Susan Schwab announced that the United States, under the auspices of the WTO, has asked China to address deficiencies in its protection of intellectual property and its import barriers that hamper the distribution of foreign books, music, videos and movies. In announcing the talks, Schwab noted that the levels of piracy and counterfeiting in China “remain unacceptably high.” The high-level discussions will take place under the WTO’s formal dispute resolution process. If the two countries do not resolve their differences within a 60-day consultation period, the United States could refer the matter to a WTO dispute settlement panel, which has the authority to recommend further action. While she acknowledged that China has taken numerous steps to improve its protection of intellectual property rights, Schwab said “we have not been able to agree on several important changes to China’s legal regime that we believe are required by China’s WTO commitments.”

View the USTR fact sheet which lists statements of support from trade groups for the Korea-United States Free Trade Agreement.

View the text of Commerce Secretary Carlos M. Gutierrez’s remarks at the Annual Investment Conference in Moscow. During his remarks, the Secretary noted that U.S.-Russia commercial ties “are stronger and more dynamic than ever before,” which “creates great opportunity for our future.” Noting Russia’s growing economic importance, and the fact that U.S.-Russia trade is “just getting started,” the Secretary stated the next step is Russian accession to the WTO.

View the text of Under Secretary of Commerce Franklin Lavin’s remarks on U.S. China trade policy to the National Association of Manufacturers on April 2. Mr. Lavin, who recently visited China, commented that the United States-China political relationship “is quite positive.” However, he noted that the economic relationship is facing some serious challenges, notably market access issues, intellectual property protections, and what he termed “simply the international implications of the transformation underway in China’s economy.” The Under Secretary stated that the United States’ approach to these problems is built around five pillars: bilateral negotiations, the WTO process, trade remedies (including countervailing and anti-dumping duties), the overall U.S. trade agenda, and U.S. export promotion work. Regarding China’s future, Mr. Lavin stated, “A prosperous China is very much in the U.S. interests, provided that China is fair and open in its economic dealings. I believe this is the path China is seeking, and working together we can help the process along.”

After their March 31 meeting, President Bush and Brazilian President Lula da Silva stated that the United States and Brazil are committed to securing an agreement on the WTO’s Doha Development Agenda that is ambitious and balanced, encourages greater market access and trade, and reduces poverty. President Bush commented that the United States is “willing to reduce our agricultural subsidies in a substantial way,” but “we expect our goods and services -- whether they be agricultural goods or manufactured goods … to be given access to markets,” he continued. Bush stressed the importance of achieving a global trade agreement. During their meeting, Bush and Lula also focused on bilateral trade issues, announcing the creation of a U.S.-Brazil forum for chief executive officers and applauding plans by the United States Council on Competitiveness and Brazilian Competitiveness Movement to stage an "Innovation Summit" in Brasilia, Brazil, in July 2007.

Commerce Secretary Gutierrez Praises Conclusion of U.S.-Korea Free Trade Agreement Negotiations

In an April 2 statement, U.S. Commerce Secretary Carlos M. Gutierrez praised the successful conclusion of a U.S.-Korea Free Trade Agreement (FTA) in Seoul after 10 months of intense negotiations. The Secretary congratulated U.S. Trade Representative Susan Schwab and the entire U.S. negotiating team for achieving the agreement, which “ presents a unique opportunity for U.S. manufacturers and service providers to expand their businesses and fulfill demand for high-quality U.S. products and services in one of the most dynamic economies of Asia. Nearly 95 percent of bilateral trade in consumer and industrial products will become duty-free within three years of entry into force of the Agreement,” Mr. Gutierrez noted, while “over $1 billion of U.S. farm exports to Korea will become duty-free immediately.” The Secretary called the agreement “ the United States’ most commercially significant FTA in over a decade. “ The Republic of Korea has a GDP of nearly $1 trillion and is already the 7th-largest export market for U.S. products and services.

The National Trade Estimate Report (NTE), released by USTR on April 2, states that unfair trade barriers continue to block U.S. access to several important markets. In a follow-up press release, U.S. Trade Representative Susan Schwab stated, “This report reflects the success of the Administration’s pro-growth, market-opening trade agenda. However, a significant amount of work remains to knock down trade barriers and ensure that American exporters have new economic opportunities across the globe.” When he met with reporters, USTR General Counsel Warren Maruyama said, “Counterfeiting and piracy, unjustified sanitary and phytosanitary [food safety] measures, inefficient, nontransparent customs regimes, high tariff barriers and closed services markets continue to hinder U.S. access to foreign markets.”

Maruyama said the United States continues to be concerned about Europe's trade-distorting subsidies to the aircraft manufacturing consortium Airbus, and remains concerned about China's prohibited subsidy practices. The United States has requested WTO dispute resolution consultations on China's apparent use of prohibited export and import substitution subsidies, which USTR says harm small and medium-sized U.S. manufacturers. The United States also has said it will ask for WTO consultations if China does not enforce intellectual property rights protections. Other trade problems include several countries' blocking of U.S. beef exports, and India's discriminatory taxes on wine and distilled spirits, Maruyama said.

Department Of Commerce Announces Plan to Shift Resources to World’s Emerging Markets

In response to the changing global marketplace, on March 28 the Commerce Department announced its Transformational Commercial Diplomacy Initiative, which would align resources of the International Trade Administration’s (ITA) U.S. Commercial Service to developing markets that are growing in importance for future U.S. business opportunities. Over the next 3-5 years, the initiative would:

• Refocus the location and structure of overseas staff to provide the support U.S. businesses need most in each market

• Improve the ability to serve U.S. businesses through the use of technology and strategic partnerships

• Identify and close small offices whose costs are no longer justified

Commenting on the initiative, Under Secretary for International Trade Frank Lavin stated, “Our strategy recognizes that U.S. businesses need more Department of Commerce support in rapidly-growing, emerging markets where trade relationships and rules are not as well established.” The Transformational Commercial Diplomacy Initiative continues the Department’s focus on emerging markets, a priority since the 1990’s.

View a brief summary of the Korea-United States Free Trade Agreement (FTA), which was released by USTR on April 2, 2007. The Korea-United States FTA will be the United States’ most commercially significant FTA since NAFTA.

According to a USIS Washington File report, the U.S. Government is focusing on prosecuting companies and individuals who bribe foreign government officials in an effort to protect the integrity of U.S. capital markets and lead international anti-corruption efforts by example. At the same time, according to the report, many other countries with similar laws have been doing little or nothing at all. Two-thirds of the 31 countries that signed the Organisation for Economic Co-operation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials have had little or no enforcement of related bribery laws since 1999, according to a Transparency International 2006 report. Some U.S. companies have complained the U.S. Government puts them at a disadvantage by pursing corporate bribery aggressively as many of their overseas competitors continue to pay bribes without fear of serious prosecution. In response, Kathryn Nickerson, a senior counsel in the Commerce Department’s Office of the Chief Counsel for International Commerce, says the United States is working to ensure fairness through the OECD working group that monitors enforcement of the OECD Antibribery Convention.

On March 30, the U.S. Department of Commerce announced its preliminary decision to apply U.S. anti-subsidy law to imports from China. This is the first time countervailing duties will be imposed on imports from a non-market economy. The decision alters a 23-year old bipartisan policy of not applying the countervailing duty (CVD) law to non-market economy countries, and reflects China’s economic development. This preliminary decision determined that Chinese producers and exporters of coated free sheet paper received countervailable subsidies ranging from 10.90 to 20.35 percent. Commenting on this decision, Secretary of Commerce Carlos M. Gutierrez stated, "By acting on the petition filed last October, the United States… is demonstrating its continued commitment to leveling the playing field for American manufacturers, workers and farmers." From 2005 to 2006, imports of coated free sheet paper products from China increased approximately by 177 percent in volume, and were valued at an estimated at $224 million in 2006.