Jacob Kopnick

The Office of the U.S. Trade Representative is accepting public comments on India’s Sept. 9 request for World Trade Organization consultations over cited renewable energy subsidies and domestic content requirements dictated by the states of Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware and Minnesota (see 1609120076), USTR said (here). USTR will accept comments anytime during dispute settlement, but comments should be in by Nov. 25 to ensure “timely consideration,” USTR said. India says the state programs are inconsistent with the WTO General Agreement on Tariffs and Trade of 1994, the Agreement on Trade-Related Investment Measures, the Agreement on Subsidies and Countervailing Measures, and the WTO-establishing Marrakesh Agreement.

The Obama administration requested the World Trade Organization establish a dispute settlement panel to review a case filed jointly with the EU alleging China unfairly leveled export constraints on 11 raw materials, U.S. Trade Representative Michael Froman announced (here). Those raw materials include antimony, chromium, cobalt, copper, graphite, indium, lead, magnesia, talc, tantalum and tin (see 1607190039). The U.S. and China held unsuccessful consultations on the matter Sept. 8-9, and the WTO Dispute Settlement Body will consider the U.S.’s request for a panel at its Oct. 26 meeting, USTR said. U.S. producers use the challenged materials in sectors including steel, automobiles, aerospace, construction and electronics, the USTR said. Some 90 percent of indium consumed in the U.S. is used in thin-film coating on flat-panel displays, it said. “China specifically committed to abide by fair, non-discriminatory access to raw materials when it joined the WTO,” Froman said. “We intend to hold them to that commitment to ensure that our workers and businesses get all the economic opportunities they’re entitled to under our trade agreements.” Because China is a leading global producer of those raw materials, export duties and quotas give the nation the ability to significantly affect global supply and pricing, USTR said. China committed as part of its 2001 WTO accession agreement to erase export duties for all products except those listed in a specific annex, which doesn’t contain the challenged materials, USTR said.

The Obama administration requested special World Trade Organization Dispute Settlement Body meetings to adopt the compliance panel report in the successful U.S. challenge of European subsidies for Airbus commercial aircraft (see 1609220032), and to adopt the panel and WTO Appellate Body reports in the winning U.S. challenge of Indian local content requirements for solar products (see 1609190043), the Office of the U.S. Trade Representative said (here). The U.S. urged the EU to accept the panel’s findings in the Airbus case, and to work with the U.S. to eliminate all incompliant subsidies, USTR said, but the EU can still appeal the panel’s findings. The WTO will automatically adopt the panel and appellate body reports pertaining to the India case, because the U.S. request was issued within 30 days of circulation of the Appellate Body report, USTR said.

Competitive advantages that African Growth and Opportunity Act countries derive from U.S.-initiated tariff benefits may fade as more countries trend toward free trade agreements, U.S. Trade Representative Michael Froman said during the AGOA Forum Sept. 26 (here). Sourcing decisions may also increasingly lean toward other considerations, such as reputational risk and ease of doing business, he said. Despite the benefits of AGOA, Froman noted that “only a handful” of beneficiaries fully utilize AGOA apparel provisions.

Legislation recently introduced by Rep. Debbie Dingell, D-Mich., would require the executive branch to publish U.S. negotiating positions on a public website after every discussion round, throughout all free trade agreement negotiations, including new and past U.S. proposals. Under the Promoting Transparency in Trade Act (H.R. 6141), if a presidential administration fails to provide such updates, the Senate Finance and House Ways and Means committees could initiate resolutions that, if passed, would nullify the president’s fast-track trade authorities, thereby blocking final U.S. approval of trade agreements. Currently, Trade Promotion Authority only requires the president to notify or consult with Congress regarding negotiation objectives at least 90 days before the initiation of FTA talks. The bill defines a “negotiating round” as a meeting to negotiate trade agreements with all parties to the deal.

A World Trade Organization Appellate Body found in favor of the Obama administration’s challenge to Indian domestic content requirements that developers of solar products in that country use Indian-manufactured cells and modules, the Office of the U.S. Trade Representative said (here). The appellate body rejected all of India’s defensive arguments, USTR said. India filed a notice of appeal April 20, after the WTO in February ruled in favor of the U.S. (see 1604220010). U.S. solar exports to India have dropped by more than 90 percent since the 2011 enactment of India’s National Solar Mission, USTR said. “Local content requirements are not only contrary to WTO rules, but actually undermine our efforts to promote clean energy by requiring the use of more expensive and less efficient equipment, making it more difficult for clean energy sources to be cost-competitive,” U.S. Trade Representative Michael Froman said in a statement.

The U.S. and 12 other World Trade Organization members are jointly launching plurilateral negotiations in Geneva to ban subsidies for fisheries worldwide, 60 percent of which are being overfished, the Office of the U.S. Trade Representative said (here). The members also plan a push for bolstering international standards regarding the reporting and transparency of fishery subsidies, as tens of billions of dollars in these subsidies contribute to overfishing and overcapacity, disadvantaging U.S. fishing industries, among other things, USTR said. Argentina, Australia, Canada, Chile, Colombia, New Zealand, Norway, Papua New Guinea, Peru, Singapore, Switzerland and Uruguay are joining the U.S. in this effort. "The United States has been a leader on this issue,” U.S. Trade Representative Michael Froman said in a statement. “We are eager to join with similarly committed WTO Members to negotiate new rules that will help protect the marine environment and allow American fishermen and women to compete on a fair and level playing field." U.S. fishing industries in 2014 exported an estimated $5.8 billion in edible fish products around the world, USTR said.

Fewer House lawmakers back the Trans-Pacific Partnership than supported Trade Promotion Authority (TPA) legislation last year, and congressional TPP approval will require “a lot of political work,” House Ways and Means Trade Subcommittee Chairman Dave Reichert, R-Wash., told members of the President’s Export Council Sept. 14 (here). Still, progress is being made toward a resolution of lawmakers’ concerns over the pact’s biologics provisions, he said. “There are some political realities here that we all know are creating this uphill battle for us,” Reichert said. “The reality is we’ve lost some votes with some of the issues -- tobacco being one of those. Those people who voted for TPA are no longer on board with TPP.”

U.S. negotiators and the government of Morocco agreed in principle to modify rules of origin for textile and apparel goods under tariff provisions of the U.S.-Morocco Free Trade Agreement to reflect initial determinations that U.S. and Moroccan producers can’t produce certain fabrics in large bulk quantities in a timely manner, U.S. Trade Representative Michael Froman said in a letter to International Trade Commission Chairman Irving Williamson (here). With final approval, products listed in the agreement as originating would include:

The U.S. and the UK could negotiate a new free trade agreement in the span of a year after the UK's exit from the EU, former U.S. Trade Representative Susan Schwab said during a conference call held by Mayer Brown. But she cautioned that the “Brexit” might not be complete until 2021, three years longer than EU and UK officials have said they expect it to take. Certain things could bode well for prospects of a bilateral U.S.-UK trade deal or for UK trade deals with other nations, including the opportunity to reduce its external tariff to a rate lower than the EU common tariff and the UK’s lack of a major agriculture industry, which tends to snag most trade agreements, Schwab said. Singapore, Chile, New Zealand, Australia and the Pacific Alliance bloc, which consists of Peru, Mexico and Colombia alongside Chile, all have liberal free trade policies and could hook up with the UK through trade agreements, she said.