The FDA should “permanently rein in” restrictions on cigars, electronic cigarettes, pipe tobacco and other tobacco products pending implementation, Senate Homeland Security Committee Chairman Ron Johnson, R-Wis., told FDA Commissioner Scott Gottlieb in a May 17 letter (here). Johnson said the FDA’s recent delay of enforcement (see 1705120035) of the May 2016 rule is a “positive first step," but "more must be done.” Some estimates indicate that “costly and time-consuming” applications for federal approval to sell e-cigarette products under the rule could cost manufacturers more than $1 million to complete, Johnson said. “The rule threatens an emerging industry as well as former smokers who have switched to vaping.”
The Senate Homeland Security Committee on May 17 approved legislation that would allow CBP to waive the requirement for all law enforcement applicants to the agency to undergo a polygraph test for active and retired Armed Forces members and full-time federal, state and local law enforcement officers who have served for at least three years. To qualify for the waiver that would be granted by S. 595, the Boots on the Border Act of 2017, current law enforcement officers who apply to CBP would have to be free from any dismissal from a law enforcement position in their work history, not be under current investigation or not have ever been found to engage in criminal activity or serious misconduct. They would have to have completed a successful employment polygraph examination within the past 10 years. Eligible Armed Forces applicants would need to have held certain security clearances within the past five years with no waiver, would be required to have received or be currently eligible to receive an honorable discharge, and not have engaged in criminal activity or any serious military or civil offenses. The waiver authority would terminate four years after enactment, unless reauthorized through follow-on legislation.
Atlas Tool Works Chief Alignment Officer Zachary Mottl championed the border adjustability provisions of the House GOP tax plan during a May 18 House Ways and Means Committee hearing on tax reform. In written testimony (here) and during the hearing, Mottl said such tax provisions can neutralize a skewed international taxation playing field in which most U.S. trading partners use value-added or goods-and-services taxes averaging 17 percent, acting as tariff and subsidy replacements. He pointed out that when Mexico abolished most taxes on U.S. goods through NAFTA, it also raised its value-added tax rate, “erecting a new tax ‘wall’” against U.S. goods. “Exports are cheaper due to the VAT rebate combined with the domestic tax cuts,” Mottl said. “Imports are more expensive because the VAT is applied with no offsetting domestic tax reduction for foreign suppliers.” Countries often “replace” tariffs lowered through trade agreements with consumption tax increases and cuts in non-border-adjustable taxes, while maintaining similar overall tax revenue, he said.
The Senate Commerce Committee on May 18 approved language to reauthorize the Federal Maritime Commission (FMC) for fiscal years 2018 and 2019 (here), as well as legislation that would make federal authority exclusive in regulating U.S. product labeling (here) and a bill to prohibit shark fin sales (here). Senators voted to pass an amendment to the Coast Guard Reauthorization Act of 2017 proposed by committee Chairman John Thune, R-S.D., that includes the full text of S. 1119, FMC reauthorization legislation proposed by Sen. Deb Fischer, R-Neb., on May 15 (see 1705170042). Among other things, the bill would increase filing requirements covering marine terminal operators and authorize the commission to enter into cooperative agreements with non-government entities to develop an online national seaport portal containing supply chain information.
Sen. Deb Fischer, R-Neb., on May 15 introduced S. 1119, Federal Maritime Commission (FMC) reauthorization legislation for fiscal years 2018 and 2019, which would increase filing requirements covering marine terminal operators. The legislation would expand to marine terminal operators and associated stakeholders a current legal requirement that states the FMC could require common carriers, or officers, receivers, trustees, lessees, agents or employees of the common carrier, to file with the agency “a periodical or special report, an account, record, rate, or charge, or a memorandum of facts and transactions related to the business of the carrier.” Those documents would still be required to be filed within the form and time prescribed by the commission and to be made under oath if FMC instructs.
The Pacific Coast Council of Customs Brokers and Freight Forwarders voiced support for the “prompt confirmation” of CBP Commissioner nominee Kevin McAleenan in a May 16 letter to the senators from California, Oregon and Washington. “He has been willing, even eager, to meet with West Coast customs brokers and freight forwarders,” the PCC said. “He has traveled to each of the seaport, airport and the land border crossings through which we facilitate trade. He knows first-hand the impact of CBP in trade facilitation and enforcement, and the need for adequate and well-trained CBP staffing.” It is more essential than ever to provide CBP with the resources and staffing it needs to facilitate international trade flows and enforce trade rules, the PCC said. "While our member customs brokers and freight forwarders are physically located along the Pacific Coast, they are engaged in facilitating legitimate international commerce to all the nation’s border, air and ocean ports of entry," it said.
Senate Agriculture Committee Chairman Pat Roberts, R-Kan., reacted favorably to the Department of the Treasury’s progress report on initial actions taken under the bilateral U.S.-China 100-day plan on economic cooperation reached in April (see 1704100008). Among other things, a Treasury fact sheet described pathways that the U.S. would take to open its market to Chinese cooked poultry imports and that China would take to open its market to U.S. beef imports (see 1705120003). Roberts in a statement (here) said ongoing discussions between the two nations could have “tremendous benefits for agriculture.” “Negotiating market access for U.S. beef products into China has been a prolonged effort, and I will remain cautiously optimistic until I see the first shipment of American beef land in China,” Roberts said. “USDA and USTR, along with the Departments of Commerce and Treasury, have made great strides thus far. Having U.S. Trade Representative Lighthizer and the newly created Under Secretary for Trade and Foreign Agricultural Affairs on board will bolster those activities. I’m hopeful they’ll get to work on other export markets as well.”
The Trump administration hopes to submit by Memorial Day a formal notification alerting Congress of its plans to renegotiate NAFTA, which would start a 90-day consultation period between the executive branch and Capitol Hill before the U.S. could begin NAFTA discussions with Canada and Mexico, according to three lobbyists working on the issue. Bipartisan members of the Senate Finance and House Ways and Means committees, as well as trade advisory groups from both chambers, are set to meet this week with U.S. Trade Representative Robert Lighthizer about the expected renegotiation, pending Lighthizer’s swearing in, scheduled for May 15, according to several sources.
The Senate on May 11 confirmed Robert Lighthizer as U.S. trade representative (here). Lighthizer is the last of President Donald Trump’s Cabinet-level nominees to be confirmed, after partisan tensions over miners’ health benefits and a legislative waiver to exempt Lighthizer from a foreign representation prohibition for USTRs complicated his path to Senate approval (see 1702150047 and 1701250061). Lighthizer was an attorney for Skadden Arps from 1985 to 2017 and was deputy U.S. trade representative before that.
Federal Maritime Commission (FMC) Acting Chairman Michael Khouri defended his agency’s review functions for shipping alliances during a May 9 hearing held by the Senate Commerce Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety, and Security (here). The alliances are “dynamic agreements” that preserve competition between participating companies, he said. Khouri contrasted the alliances monitored by the FMC with the more static permanent mergers reviewed by the Justice Department, and said ocean carriers within alliances continue to add and remove vessels from trades both inside and outside their alliances. He said that this shows competition in vessel capacity and pricing decisions.