30 October 2009

New Senate Bill Continues Trend of Tougher Trade Enforcement

The following was reported on in today's "WorldTrade Interactive".

Proponents of overhauling U.S. trade policy, seemingly emboldened by the steps the Obama administration has already taken to tighten trade enforcement, are moving to provide even more tools for that task. Democratic Sens. Sherrod Brown, Debbie Stabenow, Russell Feingold, Carl Levin and Arlen Specter introduced Oct. 28 the Trade Enforcement Priorities Act of 2009 (S. 1982), which would restore the Super 301 process and includes the following provisions.

Enforcement Priorities. No later than 75 days after issuing its annual National Trade Estimates report, the Office of the U.S. Trade Representative must (a) identify U.S. trade enforcement priorities, (b) identify trade enforcement actions taken over the past year and assess their impact on addressing foreign trade barriers, and (c) identify the priority foreign country trade practices on which it will focus its trade enforcement efforts in the coming year. In identifying priority foreign country trade practices, USTR must:

• focus on practices whose elimination has the most significant potential to increase U.S. economic growth;

• concentrate on U.S. trading partners with whom the U.S. has the largest trade deficits and whose practices are the most harmful;

• take into account all relevant factors, including the findings in various reports on trade, investment and other issues;

• consider the foreign country’s compliance with its obligations under any trade agreements with the U.S. as well as internationally recognized sanitary and phytosanitary standards;

• consider the international competitive position and export potential of U.S. products and services; and

• take into account the enforcement of customs laws relating to anticircumvention and transshipment.

The Senate Finance and House Ways and Means committees would be able to require USTR to identify a specific priority foreign country trade practice by a majority vote, except if USTR finds that (a) the practice is already being addressed and that progress is being made toward its elimination or (b) the identification of that practice would be contrary to U.S. trade policy interests.

Enforcement Actions. Within 120 days of publishing a report identifying a priority foreign country trade practice, USTR would have to:

• if the country is a WTO member or has a bilateral or regional trade agreement in effect with the U.S., initiate dispute settlement consultations at the WTO or under the applicable provisions of the trade agreement, or, for other countries, initiate a Section 301 investigation;

• seek to negotiate an agreement that eliminates the practice or provides for compensatory trade benefits; or

• take any other action necessary to facilitate the elimination of the practice.