Kirk Unveils New TBT, SPS Initiatives In Broad Enforcement Speech

출처 : [Inside US Trade] July 17, 2009 Volume 27; Issue 28

BRADDOCK, PA — U.S. Trade Representative Ron Kirk yesterday (July 16)
announced to an audience of mill workers and executives at a U.S.
Steel plant that USTR will launch two new enforcement initiatives
aimed at fighting sanitary and phytosanitary (SPS) trade impediments
and technical barriers to trade (TBT) that block U.S. exports.

The new initiatives will result in two annual reports to Congress
identifying specific problems in each areas, starting most likely next
spring, according to a U.S. trade official.

In his prepared remarks, Kirk specifically mentioned the bans foreign
countries put in place on U.S. pork exports in response to the A/H1N1
influenza scare as one example where the U.S. must better address SPS
barriers.

The SPS and TBT initiatives are part of a three-pronged enforcement
strategy announced in a speech which also included a pledge from Kirk
that USTR will begin proactively investigating violations of the labor
provisions in free-trade agreements, instead of responding to
complaints from unions and labor rights groups (see related story).

He also announced that there would be greater interagency coordination
as affirmation of President Obama’s “commitment to trade enforcement.”
He said that trade enforcement needs to be “a centerpiece” of trade
policy, which also must include new trade agreements that can create
new U.S. jobs and new markets for American goods.

Asked after the speech if the new enforcement initiative had cleared
the way for President Obama to submit any of the pending free trade
agreements with Panama, Colombia and South Korea for congressional
consideration, Kirk said in-depth work was ongoing with those three
countries to address FTA-specific issues.

“I operate on the principle that … we at USTR can do more than one
thing at the same time,” he said. “We are not doing enforcement and
neglecting those free trade agreements.”

He said USTR is working “diligently with our partners in Panama, in
Colombia, in South Korea to resolve those existing issues.”

Kirk gave the speech at U.S. Steel’s Mon Valley Works, built by Andrew
Carnegie in 1873. It was attended by the head of the local United
Steelworkers chapter and the chief executive officer of U.S. Steel
John Surma.

Regarding SPS and TBT, Kirk said that USTR would be taking the best
elements of annual reports on the section 1377 telecommunications
barriers and the Special 301 report on intellectual property rights
and employing them in the new annual reports to Congress on SPS and
TBT.

Asked how the SPS and TBT initiatives would differ from the Special
301 process, Kirk emphasized that the main effect of “naming and
shaming” countries that erect barriers would be the same even if some
details are different.

“We may not use the same language, formula, criteria as we did in the
IPR process … but the idea is to do the same things, which is to
identify those measures that aren’t [World Organization for Animal
Health]-compliant and to name those countries and report them to
Congress and then work with them to see if we can address those
barriers,” Kirk said.

A U.S. trade official speaking on background said after Kirk’s speech
that USTR is still trying to determine whether it is the best route to
rank nations in the two new reports based on the perceived severity of
their offense, as has become the practice under the Special 301.
Regardless of how this question will be settled, the new reports will
name and highlight specific problems to Congress, the official said.

The official basis said that USTR would be operating on its “organic
authority” to investigate TBT and SPS barriers to trade, and that the
new reports would not be legally based on an interpretation of Section
301 of the 1988 Trade Act.

The SPS initiative could address long-standing complaints by members
of Congress, including Finance Committee Chairman Max Baucus (D-MT)
and Ranking Member Charles Grassley (R-IA) that U.S. agriculture
exports face unfair barriers in violation of the World Trade
Organization SPS Agreement.

In addition, a trade enforcement bill sponsored by House Ways and
Means Committee Chairman Charles Rangel (D-NY) and trade subcommittee
Chairman Sander Levin (D-MI) introduced earlier this year proposes
creating a Special 301 procedure for TBT and SPS barriers. That bill,
HR 496, also proposes the creation of a trade enforcement official at
USTR and the extension of the Super 301 process to fight systemic
trade barriers, none of which were part of the Kirk speech.

USTR has not worked with Ways and Means on the pending trade
enforcement bill, and some sources speculated that the newly announced
enforcement initiative is aimed at heading off any enforcement
legislation.

Baucus also noted that he is looking forward to President Obama’s
economic framework speech, so that the U.S. can move forward on a
“robust” trade agenda, an apparent reference to seeking congressional
approval for the pending FTAs.

Kirk also said the U.S. would continue to use antidumping and
countervailing duty cases to correct trade distortions, but he did not
criticize the WTO for interpreting international dumping and subsidies
rules more expansively than negotiated, as USTR had privately
indicated he would in advance of the speech.

This would have been an apparent reference to the long-standing U.S.
complaint that the WTO Appellate Body is interpreting those rules in a
way that creates new obligations for the U.S. instead of sticking to
the exact texts of the agreements. This would have been an implicit
criticism for the rulings against the U.S. use of the controversial
antidumping methodology of zeroing, in which Commerce ignores negative
dumping margins in its margin calculations, thereby generally
inflating the final duties.

The criticism that the WTO does not apply rules “as negotiated” was
dropped from the final version of the speech, but a U.S. trade
official said there had been no policy motive for doing so. He said
the U.S. position on zeroing remains the same.

In comments after the event, Surma said he was most pleased by Kirk’s
pledge to enforce existing trade remedies for dumping and subsidies.
He said the TBT announcement could also benefit his firm. “Our
customers face these barriers so to the extent removing them helps our
customers, it helps us.”

Also in his speech, Kirk highlighted USTR’s June request for formal
WTO consultations with China over its export restraints on raw
materials. The U.S. Steel plant Kirk visited is a major importer of
manganese and has been affected by Chinese export restraints.

“We have a pretty good track record when we work with China to get
these resolutions,” he said in ad libbed remarks. A U.S. trade
official said that there had not yet been a meeting with China on the
issue but one was expected within the next two weeks.

Kirk also announced that USTR and Commerce’s Foreign Commercial
Service would be working more closely together in combating foreign
trade barriers. A U.S. trade official explained that contacts are now
on an ad hoc basis, but there has not been regular reporting.

“There have been gaps,” he said, while cautioning that increased
contacts should not create more bureaucratic paperwork. “We are not
looking to burden somebody with reporting a weekly dossier to us,” the
official said.

He indicated there would not be new staff added to coordinate the
efforts between the two agencies.

Asked about Buy America provisions in recent legislation, Kirk
dismissed such fears about them as well. “In reality the Buy America
language in the stimulus bill is the status quo we have been operating
under for 30 years,” he said.

Asked after the speech how the U.S. can criticize trading partners
when it has implemented an effective ban on Chinese poultry in a way
that appears to violate WTO rules and has implemented
Country-of-origin labeling in way that Canada and Mexico claim is a
violation of the rules, Kirk said the administration is working to
make sure all U.S. policies comply with WTO rules.

“The ability of the U.S. to retain the moral high ground on these
matters is largely contingent on our … behaving the same as we ask
our trading partners,” he said. “We are not going to ask our partners
to do anything that we are not willing to do, but if in fact we have
policies that aren’t WTO-compliant, the administration is working with
Congress to make sure that they become so.”

He added that the administration is working with Congress and Mexico
to come up with a program for Mexican truck access that will satisfy
both sides.

Kirk also mentioned the imposition this year of duties on imports of
Canadian softwood lumber and said the duties will remain in place as
an incentive to bring Canada to the bargaining table. A U.S. trade
official said that USTR was still waiting for an arbitrator to decide
on Canada’s claim that the U.S. duties were not permissible. — Erik
Wasson
BRADDOCK, PA — U.S. Trade Representative Ron Kirk yesterday (July 16)
announced to an audience of mill workers and executives at a U.S.
Steel plant that USTR will launch two new enforcement initiatives
aimed at fighting sanitary and phytosanitary (SPS) trade impediments
and technical barriers to trade (TBT) that block U.S. exports.