Fighting Trade Cheats Act

A new bill introduced in the Senate March 15 would dramatically increase penalties for fraud and gross negligence and create a new pathway for civil lawsuits against customs violators from companies, labor unions and trade associations that have been injured by customs fraud.

The U.S. Chamber of Commerce objects to legislation meant to update antidumping and countervailing duty laws, it said in a letter to leadership of House Ways and Means Committee and its Trade Subcommittee. Soon after the Chamber sent its letter, lawmakers introduced the House version of the Eliminating Global Market Distortions to Protect American Jobs Act, the legislation that the Chamber has concerns about. "The Chamber opposes this bill, which has not been subject to the scrutiny and deliberation required for a complex, far-reaching measure amending U.S. AD/CVD laws," the Chamber said. "This major overhaul of U.S. trade laws could add to inflationary pressures by raising costs for a wide variety of goods, including many products sourced from U.S. allies and partners."

The top Democrat on the Senate Finance Committee said he thinks China cheats in trade, but that consumers are going to bear the brunt of this confrontation. Sen. Ron Wyden, D-Ore, speaking to International Trade Today in a brief hallway interview May 14, said, "It is really harder and harder to divine this administration's strategy on trade. It's almost wash, rinse and repeat. They threaten something, the financial markets react badly, consumers express concern, then they pull back and start a process and you kind of get the feeling it may just be this way from now until Election Day 2020. I believe deeply in fighting trade cheating. I wrote the Enforce [and Protect] Act. With respect to say, China, I hope the Chinese cave."

Sen. Joe Donnelly, D-Ind., on April 8 pledged to make sure the U.S. government enforces new trade enforcement laws after U.S. Steel has said it will lay off 25 percent of its salaried employees. “Our steel industry is under constant attack from illegal dumping and currency manipulation, and we cannot sit by and watch as American workers continue to get cheated out of their jobs,” he said in a statement (here). “My office stands ready to assist workers and families impacted by this decision, and I will continue fighting to make sure our government fully enforces the new laws passed by Congress.” Recently enacted laws are aimed at streamlining trade enforcement, such as the June-signed Leveling the Playing Field Act, which is aimed at simplifying and expediting antidumping/countervailing duty assessments. The job cuts will include workers at U.S. Steel plants in Gary and Portage, Ind. U.S. Steel did not immediately respond to a request for comment.

Ongoing CBP problems with the collection of antidumping and countervailing duties, coupled with the agency’s inability to monitor illegal transshipments, continues to impede the growth of the U.S. garment hanger industry and other U.S. manufacturing, said M & B Metal Products President Milton Magnus in May 22 testimony before the House Small Business Subcommittee on Trade. Despite the Commerce Department’s decision in 2008 to impose duties of up to 187 percent on Chinese wire hangers, CBP has proven incapable of reining in Chinese dumping and circumvention of rules of origin requirements, Magnus said in written testimony.

On September 20, 2011, Senator McCaskill (D-MO) introduced S. 1581¹, a bill to address unfair trade practices such as duty evasion. The bill would create “know your customer” rules for customs brokers, implement improvements to the importer of record database, and permanently eliminate the AD “bonding-in-lieu” provision for new shippers.