Senate Passes Peru Free Trade Agreement Act
The Senate passed the Peru Trade Promotion Agreement (PTPA1) implementing legislation (H.R. 3688) by a vote of 77 to 18 on December 4, 2007.
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President to Sign Act Into Law
As this same measure passed the House on November 8, 2007, it will now go to the President, who has stated that he will sign it into law. This is the first free trade agreement approved by Congress that incorporates the labor and environmental standards agreed to in May 2007.
Both the President and U.S. Trade Representative now urge Congress to consider and approve the pending FTAs with Colombia, Panama, and South Korea.
(The PTPA will not take effect when the President signs H.R. 3688 into law. There are steps other than the enactment of this legislation that must be taken to bring U.S. and Peruvian laws into conformity with the PTPA, including the issuance of a Presidential Proclamation that amends the Harmonized Tariff Schedule (HTS).)
Highlights of U.S.-Peru FTA
According to an earlier summary by the USTR, the following are highlights of the PTPA (partial list):
80% of U.S. exports to become duty-free immediately. 80% of U.S. exports of consumer and industrial products to Peru will be duty-free immediately upon entry into force of the agreement, and an additional 7% will be duty free within five years. All remaining tariffs will be eliminated within ten years.
2/3 of U.S. farm exports to become duty-free immediately. More than two-thirds of current U.S. farm exports to Peru will become duty-free immediately. Tariffs on most remaining U.S. farm products will be phased out within 15 years, with all tariffs eliminated in 18 years.
Duty-free treatment for qualifying textiles and apparel. Textiles and apparel will be duty-free and quota-free immediately if the products meet the agreement's rule of origin, promoting new opportunities for U.S. and Peruvian fiber, yarn, fabric and apparel manufacturing.
Textile safeguard provision. The PTPA also includes a special textile safeguard that will provide for temporary tariff relief, if imports under the PTPA prove to be damaging to domestic producers.
Transparent and efficient customs procedures. The PTPA requires transparency and efficiency in administering customs procedures, including its rules of origin. Peru commits to publish laws and regulations on the Internet, and will ensure procedural certainty and fairness.
(See ITT's Online Archives or 11/09/07 news, 07110900, for BP summary of House passage of PTPA.
See ITT's Online Archives or 10/01/07 news, 07100105, for BP summary regarding the President's transmittal of the PTPA implementing legislation to Congress.
See ITT's Online Archives or 05/14/07 news, 07051405, for BP summary of May 10, 2007 agreement on new U.S. trade policy that incorporates labor, environmental standards in the agreement.)
1 The term 'trade promotion agreement' is essentially interchangeable with the term 'free trade agreement.'
U.S.-Peru TPA text and ancillary documents available at http://www.ustr.gov/Trade_Agreements/Bilateral/Peru_TPA/Section_Index.html
President's Bush statement on Senate passage (dated 12/04/07) available at http://www.whitehouse.gov/news/releases/2007/12/print/20071204-6.html