Legislative Update: Uncertain Fate for Trade Measures, Toxic Chemicals Overhaul Advances
Prospects for several trade-related measures to advance before the congressional summer recess are more uncertain now than they were just a few weeks ago. Permanent normal trade relations status for Russia could make it through both the House and Senate, but a bill affecting Africa, Central America and Burma has been stalled. In the meantime lawmakers have taken action on reforming legislation on toxic substances and illegally harvested wood products.
PNTR for Russia. Repealing the Jackson-Vanik Amendment and extending permanent normal trade relations status to Russia is necessary to allow U.S. businesses to take advantage of the trade liberalization measures Russia will implement beginning Aug. 22, when its accession to the World Trade Organization becomes official. PNTR legislation was approved by the Senate Finance Committee July 18 and by the House Ways and Means Committee July 26. Provisions designed to address concerns about human rights violations in Russia, which were added to the Senate bill before the Finance Committee passed it, are expected to be grafted into the House bill before a floor vote. The full House could take up the bill the week of July 30 and supporters, including the White House, will likely urge the Senate to follow suit before Congress leaves for its month-long recess on Aug. 3.
AGOA/DR-CAFTA/Burma. Senate Finance approved July 18 legislation extending through September 2015 the third-country fabric provision under the African Growth and Opportunity Act, adding the Republic of South Sudan to the list of countries eligible for AGOA benefits, making technical corrections and modifications to the DR-CAFTA rules of origin for certain textile and apparel products, and reauthorizing import sanctions against Burma for three years. In the House a scheduled July 24 vote on a companion bill was postponed and has not yet been rescheduled.
Further Senate action on this bill is uncertain because two separate holds have been placed on it, one by Sen. Robert Menendez in an effort to secure a reauthorization of the Cotton Trust Fund (see below) and the other by Sen. Tom Coburn over concerns about how the bill is funded. On July 26 Sen. Coburn attempted to strip out the AGOA provisions, stating that the mechanism being used to offset the revenue loss was just a gimmick, but that effort was denied. He also sent a letter to Sens. Harry Reid and Mitch McConnell warning that he will block any other bill that comes to the floor with similarly “fuzzy” payment provisions.
There is some speculation that this bill could come up for a vote in September, the same month that the AGOA third-country fabric provision expires. Considering that the House is only in session for eight days that month, the two chambers will have to coordinate closely if this bill is to be passed and sent to the White House before the third-country fabric provision expires.
Trade Remedy Enforcement. Senate Finance has also approved a modified version of the Enforcing Orders and Reducing Customs Evasion (ENFORCE) Act (S. 1133), which would create a set of procedures for U.S. Customs and Border Protection to investigate allegations of evasion of antidumping and countervailing duty orders. However, Inside US Trade reports that this measure is unlikely to advance in the House, where Republicans oppose certain provisions and may instead want to take up this issue “as part of a larger customs reauthorization package” that may be considered later this year.
Trust Funds. Another measure approved by Senate Finance July 18 would create a federal trust fund to support research on diseases affecting the citrus industry; reauthorize through 2015 the Cotton Trust Fund, which temporarily suspended duties on certain cotton shirting fabrics; and fully restore wool trust fund payment levels in calendar years 2010 through 2012 and ensure that the Wool Trust Fund is fully funded through 2014. Again, however, Inside US Trade cites legislative sources as saying that neither the House nor the Senate is likely to advance this bill on its own.
Toxic Substances Reform. The Senate Committee on Environment and Public Works narrowly approved July 25 the Safe Chemicals Act of 2011 (S. 847), which would reform and modernize the Toxic Substances Control Act. However, several committee Republicans criticized Democrats for abandoning an ongoing joint effort to effect an even broader overhaul of TSCA, which they said could have resulted in a draft bill as early as September, and instead advancing this “highly partisan” bill.
According to a fact sheet, the Safe Chemicals Act would require chemical companies to demonstrate the safety of industrial chemicals and encourage the development of safer alternatives to existing chemicals. It would also direct the Environmental Protection Agency to evaluate the safety of chemicals based on the best available science. Evaluations would be conducted in stages, chemicals would be screened to limit the number that require a full safety standard determination, and priority would be given to chemicals in need of safety standard determinations. The EPA would be directed to rely on existing information first and require additional testing only to the extent necessary to determine safety. In addition, companies would be able to bring new chemicals quickly into commerce through a process that is similar to existing TSCA requirements but with enhanced data and safety requirements.
Lacey Act. The Retailers and Entertainers Lacey Implementation and Enforcement Fairness (RELIEF) Act (H.R. 3210) was reported by the House Natural Resources Committee and placed on the House calendar on July 17. This bill would exempt any plant product imported or manufactured before May 22, 2008, from the requirements of the Lacey Act amendments and limit the import declaration requirement to solid wood and items imported only for commerce. It would also clarify that the Lacey Act only prohibits the importation of wood products harvested in violation of foreign laws that pertain to plants.
Several committee Democrats expressed opposition to this bill in the committee report, stating that it would “invit[e] organized crime to gravitate toward illegal logging, … allow people and companies to retain illegally harvested, imported, or stolen wood or other plant products … [and] ‘grandfather’ any plant products assembled or imported before the 2008 amendments, creating a massive loophole that criminals will exploit.”
Other. Following is a list of additional trade-related legislation that has been introduced recently. The texts of these bills are or will shortly be available on the Library of Congress Web site.
H.R. 6110 – to establish educational seminars at United States ports of entry to improve the ability of U.S. Customs and Border Protection personnel to classify and appraise articles that are imported into the United States in accordance with the customs laws of the United States (introduced July 12 by Rep. Lipinski, referred to the House Committee on Ways and Means)
S. 3389 – to provide federal jurisdiction for theft of trade secrets (introduced July 17 by Sen. Kohl, referred to the Senate Committee on the Judiciary)
H.R. 6149 – to require the U.S. Trade Representative to take action to obtain Russia’s full compliance with its commitments under its protocol of accession to the World Trade Organization (introduced July 18 by Rep. Michaud, referred to the House Committee on Ways and Means)
H.R. 6152 – to amend the Internal Revenue Code of 1986 to encourage domestic insourcing and discourage foreign outsourcing (introduced July 19 by Rep. Pascrell, referred to the House Committee on Ways and Means)
S. 3425 – to amend the Worker Adjustment and Retraining Notification Act to provide a notice requirement regarding offshoring (introduced July 24 by Sen. McCaskill, referred to the Senate Committee on Health, Education, Labor and Pensions)
H.R. 6200 – to strengthen federal consumer protection and product traceability with respect to commercially marketed seafood (introduced July 25 by Rep. Markey, referred to the House committees on Energy and Commerce, Agriculture, Ways and Means, and Natural Resources)