U.S. Trade Representative (USTR)

The U.S. trade representative complained about the European Union's intention to bring a case at the World Trade Organization challenging antidumping and countervailing duties on Spanish olives. Antidumping duties are between 16.88 percent and 25.5 percent, and countervailing duties are between 7.52 percent and 27.02 percent (see 1807310076). The USTR said the U.S. International Trade Commission said the actions of Spanish producers resulted in significant job losses and declines in profitability for the U.S. industry. "We believe that the EU’s case is without merit, and we intend to fight it very aggressively,” USTR Robert Lighthizer said Jan. 29, after the EU asked for consultations in Geneva.

The Office of the U.S. Trade Representative will hear from 24 witnesses at a Jan. 29 public hearing on what its priorities should be in negotiating a free trade agreement with Great Britain, once it is free to leave the European Union customs union. The witnesses include representatives from trade groups for agricultural, apparel, express shipping and other services, pharmaceutical, chemical and semiconductor interests, as well as people from the U.S. Chamber of Commerce, the United States Council for International Business and the AFL-CIO.

EBay praised a bipartisan group of Congress members who want the U.S. trade representative to stop talking about "reciprocal" de minimis levels. There is a footnote to that effect in the new NAFTA (see 1810190043) that has drawn opposition from trade groups in the past (see 1811060010). But despite that, the USTR included the same language in negotiating priorities for both Japan and the European Union. The EU is on a path to have no de minimis level at all for tax purposes. EBay is critical of the de minimis increases USTR convinced Mexico and Canada to agree to, because there are lower tax de minimis levels than the duty de minimis of $117. The company called it "unnecessarily complicated."

The first set of products excluded from the initial tranche of Section 301 tariffs (see 1812240010) is hoped to be the beginning of good news from the Office of the U.S. Trade Representative, said David Cohen, a customs lawyer with Sandler Travis. "We hope that this is the first notification of many exclusions to be granted," Cohen said in an email. "Many of the articles subject to the tariff are those which are not related to the stated intent of the Section 301 action which is safeguarding technology and apply, in some cases, to products that utilize decades old commonly available technology. Moreover, the breadth of the coverage unfortunately sweeps in many products that in no way help China achieve her 2025 goals; for example a hand wrench is included. We hope the Administration continues to review the pending petitions and permit many other products to enter the US commerce free from the Section 301 duties."

“Successful negotiation” of a U.S.-EU trade agreement would need to build on World Trade Organization “principles” for removing technical trade barriers, safety consulting and certification company UL told the Office of the U.S. Trade Representative in comments in docket USTR-2018-0035 submitted to help frame U.S. negotiating positions in future trade talks. UL especially wants USTR to be sure a U.S.-EU trade agreement preserves “regulators’ decision making authority,” it said. UL also urges USTR to “consider regulatory cooperation solutions beyond mutual recognition agreements as these are often problematic in implementation.” A successful trade agreement should “enhance the business and investment climate” for services in UL's wheelhouse, including “testing, inspection and certification, that help companies deliver on innovation, compliance, and market access needs as a means to reduce regulatory barriers,” it said. Many other companies and groups offered input in the same docket (see 1812110013).

Agriculture interests, including meat, wheat and grape growers, told the Office of the U.S. Trade Representative that they will lose market share to competitors in Australia, Europe, Canada, Mexico and Chile as those countries begin to benefit from the Trans-Pacific Partnership and EU-Japan free trade agreement. As they testified Dec. 10 on negotiating a U.S.-Japan agreement, they said speed is of the essence.

On Dec. 10, the Office of the U.S. Trade Representative will hear from companies, trade groups and unions on what they'd like it to push for in a U.S.-Japan trade agreement. The witness list was posted on USTR's site, and includes many more parties than testified at the U.S. International Trade Commission's Dec. 6 hearing on the potential economic effects of such a trade deal (see 1812060021).

China used to levy a 25 percent tariff on the BMWs, Mercedeses, Lincolns and Teslas its dealers imported from the U.S., but it recently dropped tariffs on other countries' cars by 10 percentage points, and hiked tariffs on American autos to 40 percent. U.S. Trade Representative Robert Lighthizer, in a late-afternoon announcement Nov. 28, said that's not fair. “China’s policies are especially egregious with respect to automobile tariffs," he said. "Currently, China imposes a tariff of 40 percent on U.S. automobiles. This is more than double the rate of 15 percent that China imposes on its other trading partners, and approximately one and a half times higher than the 27.5 percent tariff that the United States currently applies to Chinese-produced automobiles." He said that at the president's direction, "I will examine all available tools to equalize the tariffs applied to automobiles."

A former Office of the U.S. Trade Representative deputy predicted that the president of China and President Donald Trump would meet in the middle at the G-20 in Argentina, neither resolving the problems between the two countries nor declaring an impasse. He did not sound as confident that some kind of progress would be enough to halt the escalation in tariffs. "I think the signals from both countries are [that] they know this is an opportunity," Robert Holleyman said, as he opened a Nov. 28 Tariff Town Hall sponsored by tuna canneries. "I hope this gets us out of the current morass."

The Office of the U.S. Trade Representative released a 53-page update to the Section 301 investigation that says there has been no fundamental change in China's "acts, policies, and practices related to technology transfer, intellectual property, and innovation, and indeed [it] appears to have taken further unreasonable actions in recent months." This Nov. 20 report, which comes 10 days before USTR Robert Lighthizer, President Donald Trump and other administration officials meet with China's president and negotiators, seems to counterbalance Trump's sunnier tone of late (see 1811190032).