U.S. and Panama Sign Free Trade Agreement (Congressional Approval Still Required, Etc.)

(International Trade Commission sources have previously stated that the term TPA is essentially interchangeable with the term free trade agreement (FTA).)

According to the press release, the U.S.-Panama TPA is a comprehensive agreement that will eliminate tariffs and other barriers to trade in goods and services between the U.S. and Panama. The agreement includes the added provisions on labor, the environment, etc. that reflect the recent bipartisan agreement on trade policy reached between the Bush Administration and Congress.

Next Step in Implementing U.S.-Panama TPA is Congressional Approval, Etc.

Now that the FTA with Panama has been signed, the expected next step is for the President to formally submit the U.S.-Panama TPA implementing legislation package to Congress.

If the U.S.-Panama TPA implementing legislation is passed by Congress (both the House and Senate), it could then be signed into law by the President, who would subsequently issue a proclamation implementing the U.S.-Panama TPA.

Highlights of the U.S.-Panama TPA

According to an earlier summary by the USTR, the following are highlights of the U.S.-Panama TPA (partial list):

Over 88% of exports of consumer and industrial goods to Panama would become duty-free immediately. Over 88% of U.S. exports of consumer and industrial goods to Panama would become duty-free immediately upon entry into force of the agreement, with remaining tariffs phased out over 10 years. The agreement includes "zero-for-zero" immediate duty-free access for key U.S. sectors including agricultural and construction equipment, information technology products, and medical and scientific equipment.

More than half of current U.S. farm exports to Panama would become duty-free immediately.According to the USTR, more than half of current U.S. farm exports to Panama would become duty-free immediately, including high quality beef, other meat and poultry products, soybeans and products, most fresh fruits and tree nuts, distilled spirits and wine, and a wide assortment of processed products. U.S. farm products benefiting from expanded market access opportunities through tariff-rate quotas (TRQs) include pork, chicken leg quarters, dairy products, corn, rice, refined corn oil, dried beans, frozen french fries, and tomato products. Tariffs on most remaining U.S. farm products would be phased out within 15 years.

Textile provisions, safeguards, etc. The U.S. and Panama would provide reciprocal duty-free access immediately for certain textile and apparel goods. Apparel products made in Panama would be duty-free under the TPA if they use U.S. or Panamanian fabric and yarn. A special textile safeguard would provide for temporary tariff relief, if imports under the TPA prove to be damaging to domestic producers. The USTR notes that the U.S.-Panama TPA is one of the few FTAs without tariff preference levels (TPLs).

Greater protection for intellectual property rights. The TPA provides for improved standards for intellectual property rights including protections for digital products such as U.S. software, music, text, and videos; stronger protection for U.S. patents, trademarks and test data, including an electronic system for the registration and maintenance of trademarks; and further deterrence of piracy and counterfeiting by criminalizing end-use policy.

Customs Administration. The TPA would also facilitate the movement of trade and address transshipment concerns by requiring Panama to maintain a monitoring program in its free trade zones (FTZs) and to provide U.S. Customs and Border Protection (CBP) with access to information collected in connection with the program. The TPA also requires Internet publication of customs procedures, speedy release of goods, the use of advance binding rulings, and specific commitments related to express delivery shipment.

(See ITT's Online Archives or 04/05/07 news, 07040517, for BP summary of the President's notification to Congress of his intent to sign the U.S.-Panama TPA.)

USTR Press Release (dated 06/28/07) available at http://www.ustr.gov/Document_Library/Press_Releases/2007/June/United_States_Panama_Sign_Trade_Promotion_Agreement.html)