Legislative update: groundwork being laid for actions later this year
April 30, 2009
World Trade\Interactive
Congress has returned from its Easter recess and is preparing to take up a number of trade-related measures in the coming months. A customs reauthorization bill is expected sooner rather than later, while work on the miscellaneous trade bill and preference program reform is continuing to proceed. There are also indications that legislation to implement the U.S.-Panama Free Trade Agreement could be sent up to Capitol Hill in the near future.
Customs Reauthorization. A draft customs reauthorization bill is being reviewed by legislative staff as well as the trade community and is expected to be introduced by the end of this month. This measure is expected to include a number of different provisions but in large part is geared toward ensuring that U.S. Customs and Border Protection has sufficient resources to facilitate international trade as well as enforce trade laws and ensure supply chain security.
Trade Preferences. With two trade preference programs set to expire at the end of 2009 and a new administration developing its own trade policy, prospects for changes to such programs are perhaps better this year than they have been for some time. Lawmakers have already introduced legislation that would create new trade preferences for certain goods imported from Afghanistan and Pakistan, which has been explicitly supported by President Obama, and add Paraguay as a beneficiary under the Andean Trade Promotion and Drug Eradication Act. In addition, a group of more than two dozen trade and business associations and non-governmental organizations are urging a major overhaul that would replace the various trade preference programs already in place with a single program that expands country and product eligibility, simplifies rules of origin and will remain in place for a substantial length of time.
MTB. Members of Congress are continuing to gather support from their colleagues for a miscellaneous trade bill, which can lower or suspend duties on imports of key manufacturing and production inputs that are not made in the U.S. or where there is no domestic opposition. In late April nearly two dozen members of the House of Representatives asked Ways and Means Committee leaders to make passage of the MTB a priority, asserting that at a time of global financial crisis the MTB can help U.S. companies sustain domestic production levels and jobs. Click here for more information on the MTB process.
Panama FTA. There are increasing indications that the Obama administration is preparing to submit legislation to implement the Panama FTA. The agreement is thought to enjoy widespread support, but some in Congress and industry are pushing back against efforts to move it ahead quickly, stating that concerns about labor rights and bank secrecy laws in Panama should be addressed first.
China Currency. Legislation addressing the alleged undervaluation of China’s currency, which was a hot topic in the last Congress, is not expected to be a high priority for lawmakers this year. While President Obama had indicated during his campaign that he believed China is manipulating its currency, the first Treasury Department report on the issue by his administration declined to name China as a currency manipulator. An Inside US Trade article noted that this step has had at least two separate effects in Congress. On the one hand, with the issue apparently a low priority for the White House, Senate Finance Committee Chairman Max Baucus, D-Mont., indicated that he is “uninterested in reintroducing the panel’s currency legislation at this time.” On the other hand, the article added, prominent past supporters such as Sens. Charles Schumer, D-N.Y., and Lindsey Graham, R-S.C., said that they were disappointed by Treasury’s recent report and that they intend to reintroduce their currency bill, although they declined to speculate on when that might happen.
Climate Change. Both the House and Senate are working to approve this year legislation to deal with and reduce the effects of climate change. In the House, a draft bill currently being circulated for discussion allows for the imposition of border taxes on imports under certain conditions. The Senate has yet to develop legislation of its own, but a similar provision is possible in that chamber as well. There is likely to be extensive debate on this issue given that there is substantial disagreement among domestic industries and the legislators that represent them.
Port Security. On April 28 the four senators from New York and New Jersey issued a joint press release announcing legislation designed to further improve security at U.S. seaports. According to a fact sheet, the Port Authority Implementation Act (S. 3174) would:
• impose mandatory security standards on all international cargo containers entering the U.S. and deny entry to container shipments that fail to meet those standards;
• require each port to have a response and recovery plan so that there is a process to restore commerce after a major incident or disruption;
• require the use of a standardized risk assessment tool so that the Department of Homeland Security can more accurately determine risks to ports and surrounding communities and businesses areas and prioritize port security grants accordingly;
• authorize any federal, state or local law enforcement official to confiscate a suspected fraudulent or otherwise tampered with federal Transportation Worker Identification Credential at locations where there is no Coast Guard presence;
• require each foreign vessel entering a U.S. port to designate a “security individual” who would be responsible for responding to a transportation security incident while the vessel is docked at a U.S. port; and
• bring ships that are largely unregulated, such as those used in essential port services like supply vessels, launch vessels and bunker and fuel delivery ships, under federal security requirements.
Other. Other trade-related bills that have been introduced recently include the following. (Note that the text of these bills can be found on the Library of Congress’ Web site.
• S. 908/ H.R. 1985 – to expand economic sanctions against Iran
• H.R. 2152 – to authorize certain private rights of action under the Foreign Corrupt Practices Act of 1977 for violations by foreign concerns that damage domestic businesses
• H.R. 2155 – to restrict the entry of steel, drywall and cement products that fail to meet industry standards
• S. 893 – to establish the Office of Imported and Domestic Product Safety in the Department of Commerce and the Product Safety Coordinating Council
• H.R. 2076 – to provide for the establishment of a border protection strategy for the international land borders of the United States
• H.R. 2086 – to require that foods containing spices, flavoring or coloring derived from meat, poultry or other animal products (including insects) bear labeling stating that fact and their names
• H.R. 2087 – to amend the Federal Food, Drug and Cosmetic Act relating to freshness dates on food
• H.R. 2098 – to extend the look-through treatment of payments between related controlled foreign corporations
• H.R. 2088 – to require the Food and Drug Administration to finalize a standard for broad-spectrum protection in sunscreen products
• H.R. 2091 – to impose a retail tax on single-use carryout bags
• H.R. 2050 – to prohibit the introduction or delivery for introduction into interstate commerce of novelty lighters
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