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Unraveling the Mysteries of U.S. Trade Policy Formulation in the Executive Branch: What Lies Behind the Acronyms and S

WITA-GWU Intensive Trade Seminar. Unraveling the Mysteries of U.S. Trade Policy Formulation in the Executive Branch: What Lies Behind the Acronyms and Spirited Debates?. Marideth J. Sandler, CEO Sandler Trade LLC 202-350-4303 sandler@sandlertrade.com http://sandlertrade.com.

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Unraveling the Mysteries of U.S. Trade Policy Formulation in the Executive Branch: What Lies Behind the Acronyms and S

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  1. WITA-GWU Intensive Trade Seminar Unraveling the Mysteries of U.S. Trade Policy Formulation in the Executive Branch: What Lies Behind the Acronyms and Spirited Debates? Marideth J. Sandler, CEO Sandler Trade LLC 202-350-4303 sandler@sandlertrade.com http://sandlertrade.com

  2. Sandler Trade, LLC. • Our goal is to make international tradereallyhappen • We provide embassies, companies, and others strategic advisory services to expand export penetration and to safeguard preference opportunities and trade policies • We expand emerging economies’ trade, including through focused market linkages, data analysis, trade show maximization, and use of FTAs and preference programs • We know import and other regulations (CBP, FDA, CSPC…) • We are strong advocates in the Exec branch and on the Hill • We are USTR grads and comprise an multinational team that speaks 10 languages

  3. Webinar Content • Alphabet soup: acronyms govern trade • How the Executive Branch formulates and executes international trade policy • Statutory foundation for responsibilities • Trade-related agencies: what do they do? • Free Trade Agreement negotiations, including Private sector and Congressional roles • Upcoming legislative agenda • Resources and links to know

  4. Alphabet Soup

  5. Alphabet Soup • POTUS • NSC/NEC • USTR • DOL • DOS • USDA • DOC • DHS/CBP • USITC • TPRG/TPSC • ACTPN • APAC/ITAC • IFAC • LAC • FTA • TPA • TAA • MTB • BIT • GSP • AGOA • CBI • NEI • APEC • TPP • TTIP • TISA • TF • TIFA • IPR • Special 301 • WL/PWL • AD/CVD • FTZ/EPZ • HTSUS • FRN

  6. Executive Branch President: Barack Obama Vice: Joseph Biden Term: 4 Years Limit: 2 years Elected by: Electoral College Members: 15 (heads of depart.) Nominated by: President Executive Office of the President: NSC, USTR, OMB, NEC, etc. Executive Office of the President: NSC, USTR, OMB, NEC, etc.

  7. The Congress, Presidentand USTR • In 1934, U.S. Congress delegated to the President (POTUS) authority to negotiate trade agreements, leading to creation of the GATT, WTO, IMF and FTAs. • Trade Act of 1974 created time-limited “fast track” FTA negotiation and approval authority, re-named trade promotion authority (TPA) in 2002; last expired 7/2007. • President delegated to the Office of the U.S. Trade Representative (USTR)development, coordination and negotiation of U.S. international trade, commodity, and direct investment policies and agreement negotiations, oversight and enforcement. • National Security Council (NSC), and National Economic Council (NEC) established in 1993, help POTUS oversee trade policy.

  8. USTR • The USTRis an Ambassador and Cabinet member who serves as President’s principal trade advisor, negotiator, spokesperson and representative to WTO. • USTR is in the Executive Office of the President. Through an interagency structure (TPRG&TPSC), USTR coordinates trade policy within the Administration and, through consultations with Congress and private sector advisory committees, frames issues for Presidential decision. • Consultation with 28 appointed industry and special interest advisory groups: ACTPN, APAC, 16 ITACs, LAC, TEPAC, ATAC, TACA, IGPAC • Federal Register Notices (FRNs): regulations.gov

  9. Department of Commerce • Mission: make U.S. businesses more innovative at home and more competitive abroad • Multiple bureaus and functions: weather, patents, exports, standards, fish management, data, census, etc. • Key trade functions: • antidumping and countervailing duty investigations • sectoral and functional expertise • expert support for USTR trade negotiations • trade compliance monitoring • management of industry trade advisory committees • export promotion and advocacy

  10. Other Key Trade Policy Agencies • Department of State (DOS) • Department of Agriculture (USDA) • Department of Treasury (Treas) • Department of Labor (DOL) • Ex-Officio: U.S. International Trade Commission (USITC or ITC): an independent agency • Administers U.S. trade laws within its mandate • Website with U.S. export and import data/Maintains U.S. Harmonized Tariff Schedules (HTSUS) • Does independent trade studies pertinent to FTAs, regulatory decisions, tariffs, U.S. competitiveness

  11. Interagency Review Process: Led by USTR 19 agencies provide advice to USTR in developing and coordinating implementation of U.S. trade policy; operates by reaching consensus on issues/decisions: • 90 Subcommittees (e.g., Special 301, GSP) recommend to: • Trade Policy Staff Committee (AUSTR/DAS): if consensus on the decision - is final determination; if not goes to… • Trade Policy Review Group (Deputy USTR/Deputy or Assistant Secretary): if consensus, is final decision; if not, goes to… • Principals (Cabinet): if consensus, is final decision; if not goes to the… • President for THE final decision

  12. USTR Trade Programs • Reciprocal Free Trade Agreements (FTAs): w/20 countries • Trade and Investment Framework Agreements (TIFAs): 48 TIFAs (and many other agreements) • Unilateral Preferences: Generalized System of Preferences (GSP), African Growth & Opportunity Act (AGOA), Caribbean Basin Initiative (CBI) • Bilateral Investment Treaties (BIT): with 40 countries

  13. Enforcement Mechanisms • WTO consultations and dispute settlement • FTA consultations and dispute settlement • Special 301 (Intellectual Property Rights (IPR) Review): Notorious Markets; Priority Watch List (PWL) 13 countries; Watch List (WL) 26 countries • Mandatory GSP Criteria: Worker Rights, IPR, Investor Protections

  14. FTA Negotiation Process • Country requests FTA; need support of industries and labor • Interagency consensus to launch negotiations (assess impacts of a comprehensive FTA, likelihood of success, etc.) • President notifies Congress of intent to negotiate (90 days) • During wait, USITC report; Hill and ITAC consultations begin (2002-2007: 1,605 consultations with Hill); public comments • Negotiations occur in “rounds” between the parties • Prior preparation and internal approval by the Administration of proposed text – shared with Congress and advisory committees – bracketed text changes after each “round” • Negotiations conclude – toughest issues resolved at the end; may include side letters

  15. FTA Approval Process • President notifies Congress of intent to sign (90 days) • Environmental reviews, advisory committee reports, USITC FTA economic impact report • Once FTA negotiations end: attorneys do legal scrub of text, followed by Presidential announcement and signing • During course of FTA negotiation and especially after signing, Embassies, private sector associations, NGOs lobby Congress • Getting FTAs through Congress: “little to do with agreement substance and everything to do with U.S. politics” • Fast track or TPA: up/down vote approval authority essential • Fast track approval procedures (must occur within 90 days)

  16. President Obama’s Actions Since being in office, President Obama has: • Pushed through approval of three FTAs (Panama, Colombia, Korea) • Re-launched the Trans Pacific Partnership and added partners – Malaysia, Mexico, Canada, Japan • Launched the Trans Atlantic Trade and Investment Partnership Agreement (TTIP) between the U.S. and EU • Launched Trade in Services Agreement (TISA) talks • New AGOA review launched • Emphasis on enforcement and reciprocity

  17. USTR Negotiating Agenda • Trans Pacific Partnership Agreement (TPP) • Transatlantic Trade and Investment Partnership (TTIP) • Trade in Services Agreement (TISA) • Agreement on Trade Facilitation (TF) • Information Technology Agreement (ITA) • Participation in Strategic and Economic Dialogue (S&ED) with China and with India • Doha Round -- WTO Ministerial in Bali

  18. Key Congressional Trade Committees The Big Four: • Senate Finance Committee (Chair: Sen. Baucus (D-MT); Minority: Ranking Member: Sen. Hatch (R-UT) • Subcommittee on International Trade, Customs and Global Competitiveness (Sen. Wyden (D-OR); Sen. Isakson (R-GA)) • House Ways and Means Committee (Chair: Rep. Camp (R-MI); Ranking: Rep. Levin (D-MI)) • Subcommittee on Trade (Rep. Nunes (R-CA); Rangel(D-NY)) Senate Leadership: Majority Leader Sen. Reid (D-NV), Minority Leader, Sen. McConnell (R-KY) House Leadership: Speaker Boehner (R-OH); Majority Leader Cantor (R-VA); Minority Leader Pelosi (D-CA)

  19. 2013-14 Congressional Trade Agenda • TPA – expired in 2007 • GSP – expired in July 2013 • ATPA – expired in July 2013 (only remaining beneficiary was Ecuador – no renewal plans) • TAA – first created in 1962; expires in Dec 2013 • AGOA – expires in September 2015 • Customs Modernization Act - waiting • Miscellaneous Tariff Bill…is waiting (600 tariff suspensions expired 1/1/13, MTB procedural reforms) • Trade, however, is not the only thing facing Congress

  20. Trade and theLegislative Agenda • Fall 2013 Legislative Agenda -- Syria -- Debt Ceiling -- Sequestration -- Budget -- Tax Reform -- New Federal Reserve Chair -- Tax Extenders

  21. Trade Policy Tips • U.S. Government focuses on getting things done rather than building relationships; you may be different • Sequestration may mean that staff are in the office less • Ask questions, even if you know the answer; you will find out more than just the answer you need • Meet your deadlines • Keep current: e-newsletters (agencies and companies), Facebook, LinkedIn, Twitter, blogs • Know which agency really is in charge or makes the decision (despite what others may claim) • What you see is not always what it is, so…. • Keep asking questions and solicit opinions

  22. Web Resources • Glossary of Acronyms: http://www.ustr.gov/about-us/trade-toolbox/glossary-trade-terms • U.S. Trade Representative (has e-newsletter) • http://www.ustr.gov/about-us/press-office/22press-releases/2012/september/ustr-press-office-week-ahead-september-10-25 • Department of Commerce: www.commerce.gov • U.S. International Trade Commission: www.usitc.gov • Congressional Research Service: https://opencrs.com(also: J.F. Hornbeck paper on “Congress & Trade,” April 2011) • Guide to U.S. Government: http://bensguide.gpo.gov/ • Other:sandlertrade.com, wita.org, globalcommunicators.com

  23. Where to Look For… • Trade policy – ustr.gov; trade.gov • Import regulations – cbp.gov • Import data: http://dataweb.usitc.gov/scripts/tariff_current.asp • Tariff schedules, trade studies - USITC.gov; census.gov; • Legislation -- thomas.loc.gov; • Submitting comments -- regs.gov • Federal notices -- federalregister.gov • Can’t attend a hearing but want to listen - hearings are webcast – go to Committee websites

  24. Thank you!

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