House Ways and Means Trade Subcommittee Chairman Adrian Smith, R-Neb., said he intends to co-sponsor a renewal of the African Growth and Opportunity Act, and said he believes the appetite in Congress is "strong" to act before the summer of 2025. AGOA expires Sept. 30, 2025.
Generalized System of Preferences (GSP)
The Generalized System of Preferences (GSP) is a trade preference program established by the Trade Act of 1974, which promoted economic development by eliminating duties on many products when they were imported from one of the 119 countries and territories designated as developing. The program expired in December 2020 and is pending renewal in Congress. Should Congress renew the program with a retroactive refund clause, CBP will refund duties for entries eligible for GSP. Under the GSP, goods that are entirely produced or manufactured in a beneficiary developing country may qualify for duty-free entry under GSP; all third-party materials must undergo a substantial transformation defined as at least 35% of the good’s value having been added in the beneficiary country. The goods must also be “imported directly” from the GSP eligible country.
The House Select Committee on China, having heard from witnesses advocating a punitive approach to Chinese trade and investment (see 2305180064), asked to hear from advocates for both that approach and a more moderate one in a debate on Capitol Hill.
Members of the Select Committee on China led a letter from 66 House members to the leaders of the House Ways and Means Committee, complaining that the expiration of the Generalized System of Preferences benefits program has benefited China and led importers who had capitalized on GSP to return to China.
Rep. Earl Blumenauer, D-Ore., introduced a bill designed to improve and modernize trade adjustment assistance programs, including "significantly higher funding levels and expanded eligibility," according to a summary provided by Blumenauer's office.
Very little of a hearing on customs modernization focused on the issues CBP and the trade have focused on as they work on a modernization proposal. The agency and traders are talking about new kinds of advance data, expedited release for trusted traders, better harmonization of data requests from partner government agencies and CBP, and data sharing from CBP with rights holders on intellectual property violations, among other changes.
Senate Finance International Trade Subcommittee Chairman Tom Carper, D-Del., said he would like to hold a future hearing on the Americas Act, a proposal from Sen. Bill Cassidy, R-La., to liberalize trade with Central American, Caribbean and South American countries (see 2301110045 and 2301130042), and to pay for grants and subsidized loans for countries reshoring or nearshoring out of China with changes to de minimis law. Sen. Michael Bennet, D-Colo., is a co-sponsor of the bill.
A note to the Harmonized Tariff Schedule specifies that, in order to qualify as water resistant, goods must both meet a water seepage standard and incorporate either rubber or plastics. Maine's two U.S. senators recently introduced a bill that would drop the clause on plastics and rubber that is part of the additional note to Chapter 62.
Senate Finance Committee ranking member Mike Crapo, R-Idaho, said that he and Chairman Ron Wyden, D-Ore., have not delved into details about what they might keep and what they might drop from the U.S. Innovation and Competition Act trade title as the Senate tries for a second China competition bill. But, Crapo said, with regard to the Section 301 exclusion process directive that was part of the June 2021 package, it may not be on the agenda.
The inability of CBP to stop all goods made with Uyghur forced labor was one of the focuses of a trade hearing hosted on Staten Island by the House Ways and Means Committee, and when committee Chairman Jason Smith, R-Mo., asked a witness what more could be done to crack down, Uyghur activist Nury Turkel said the Uyghur Forced Labor Prevention Act should be expanded to cover all of China.
Senate Finance Committee Chairman Ron Wyden, D-Ore., said he'll use the 2021 trade title from the Senate China package as his committee works on its contribution to a second China package envisioned by Senate Majority Leader Chuck Schumer, D-N.Y., to address economic competition with China and to deter Chinese aggression toward Taiwan.