The Generalized System of Preferences (GSP) provides duty-free treatment to goods of designated beneficiary countries. The program was authorized by the Trade Act of 1974 to promote economic growth in the developing countries and was implemented on January 1, 1976.
US CBP issued new requirements governing the movement of cargo in-bond from the Port of Discharge to an Inland Port for Customs Clearance or Export. These new requirements are effective November 27, 2017. Full enforcement of the new rules will begin February 24, 2018. The most important change for MIQ origins is that CBP now requires the six-digit HTSUS number on ocean cargo consigned to inland points.
The United States International Trade Commission (USITC) on October 31 announced the remedy recommendations that it will forward to the President in its global safeguard investigation regarding imports of crystalline silicon photovoltaic cells (whether or not partially or fully assembled into other products).
Generalized System of Preferences (“GSP”) Expires December 31, 2017
The Generalized System of Preferences (“GSP”), first implemented on January 1, 1976, periodically expires and must be renewed by Congress to remain in effect. The most recent GSP reauthorization (H.R. 1295) expires on December 31, 2017. Although Congress let the program lapse for two years past the previous expiration date of July 31, 2013, we are not aware of any current effort to end the program. But it nonetheless remains a possibility.
Presidential Authority To Regulate International Trade & Potential Impacts To NAFTA
Do you know the President’s authority as it is related to international trade and commerce? This presentation provides insight into the President’s authority according to language in the Constitution, Executive Authority per specific Trade Acts, as well as historical precedents. The presentation also reviews the current status of NAFTA and the potential impact to Regional Value Content if the trade agreement is renegotiated.
A widely-cited AXIOS report indicates the President intends to impose 20% tariffs on Steel and possibly other imports, against the advice of his cabinet. Other products under scrutiny include Aluminum, Solar Cells and Washing Machines.
More expansive than Antidumping or Countervailing Duty, Section 232 of the Trade Expansion Act of 1962 (Sec 232 – National Security: Steel, Aluminum) and Section 201 of the Trade Act of 1974 (Sec 201 – Global Safeguards: Solar Cells, Washing Machines) permit the imposition of trade barriers, including increased duties, across all origins and, is not trading-partner specific.
We may soon learn whether the President has the legal authority to impose tariffs on imports without Congressional approval or whether the administration will bypass WTO rules and impose new barriers to imports. The first test may come as the result of an April 20th Presidential Memorandumdirecting Commerce to initiate an investigation under Section 232(b) of Trade Expansion Act of 1962 to determine the impact of steel imports on national security.
The President was prepared to end the North American Free Trade Agreement deal, which had governed trade relations for the past 23 years, with a dramatic announcement April 29th at a Pennsylvania political rally marking his 100th day in office. But after speaking with the leaders from Canada and Mexico, the President announced he will not cancel the North American Free Trade Agreement and will instead work to renegotiate it with Mexico and Canada, reserving the right to cancel if the US does not obtain a favorable deal.
A TRANS-PACIFIC PARTNERSHIP (TPP) WITHOUT THE U.S.?
The President signed an order on January 23, 2017 withdrawing the United States from the Trans-Pacific Partnership (TPP). Because the original TPP deal required the ratification of TPP members comprising at least 85 percent of the GDP of the entire TPP grouping, without the U.S., a new version of the TPP agreement would be needed for it to take effect. However, a TPP agreement without the U.S. is still relevant and would have significant economic value. The remaining Parties include four of the world’s 20 largest economies — Japan, Canada, Australia, and Mexico — alongside significant emerging economies like Vietnam and Malaysia. With that economic value in mind, the 11 existing TPP members, joined by China and South Korea, met in Chile on March 14-15 to discuss: (a) the possibility of a TPP agreement without the U.S., (b) the Regional Comprehensive Economic Partnership (RCEP) as the TPP alternative and, (c) the Free Trade Area for the Asia-Pacific (FTAAP).
As detailed in the Agenda, the Administration believes that the United States will be best served by focusing on bilateral negotiations rather than multilateral negotiations – and by renegotiating and revising trade agreements when US goals are not being met. The Administration rejects the argument that the United States should, for an purported geopolitical advantage, ignore unfair trade practices that disadvantage American workers, farmers, ranchers, and businesses in global markets.