Trade Issues

For more information or updates, please contact Brittany Mountjoy.

 


 

Free Trade Agreements

The United States is the one of the world's largest economy and the largest exporter and importer of goods and services. Trade is critical to American companies, small and large, by fueling economic growth, supporting 39.8 million American jobs, raising living standards, and helping Americans provide for their families with affordable goods and services.

The United States has free trade agreements with 20 countries, including:

The United States completed negotiations of a regional, Asia-Pacific trade agreement – the Trans-Pacific Partnership (TPP) Agreement – in 2015 and is currently awaiting approval by Congress. The TPP is a free trade agreement negotiated between Australia, Canada, Japan, Malaysia, Mexico, Peru, United States, Vietnam, Chile, Brunei, Singapore and New Zealand. SOCMA was disappointed in the weakened Rules of Origin for SOCMA member companies. However, there is significant potential for the improvement in the transparency of chemical regulations and intellectual property. A snapshot of the results of the final negotiations: 10 years regulatory data protection on ag chemicals; trade secret protection; IP Enforcement calls for governments to provide civil, criminal and provisional rights of action against IP violations; extensive regulatory transparency (publish all requirements, including standards and new regulations). 

The United States is also in negotiations with the European Union on the Transatlantic Trade and Investment Partnership (TTIP), with the objective of shaping a high-standard, broad-based regional pact. SOCMA strongly supports a strong EU-U.S. Transatlantic Trade and Investment Partnership (TTIP). The U.S. chemical industry stands to gain the most on tariff reduction from this agreement, saving the industry over $1 billion annually in eliminated tariffs if approved. A comprehensive TTIP Agreement that reduced or eliminated barriers to trade and investment would create benefits for SOCMA members and foster SOCMA member companies’ ability to employ high value workers in both the United States and Europe.

Bilateral investment treaties (BITs) and trade and investment framework agreements (TIFAs), precursors to free trade agreements, are in place with many more countries. The BIT program helps protect private investment, to develop market-oriented policies in partner countries and promote U.S. exports, while TIFAs provide strategic frameworks and principles for dialogue on trade and investment issues between the United States and other parties to the TIFA. Currently, the U.S. continues to work on changes to a model BIT text. We look forward to continuing BIT negotiations with countries like China and India, which may produce some concrete benefits to both sides such as more transparent laws and regulations and non-discriminatory treatment of foreign investments.

SOCMA continues to engage and provide input into the trade negotiation process and advocate for SOCMA member company interests.


Temporary Duty Suspensions

Per the American Manufacturing Competitiveness Act of 2016, which was signed into law by President Obama in May 2016, the International Trade Commission (ITC) will now be in charge of reviewing petitions and domestic availability.

Beginning in October 2016, companies will submit petitions to the ITC for their consideration. After a period of public comments, the ITC will submit a recommendation to Congress, which Congress will consider under existing rules.

The MTB process corrects, on a temporary basis, distortions in the U.S. tariff code that place an unnecessary and anti-competitive tax on manufacturers, retailers and other businesses across the country that rely on imported products not available in the United States. The process will end years of unnecessary tax increases on U.S. specialty chemical manufacturers, many of whom are already paying higher prices for raw materials not domestically produced, allowing them to create new jobs and grow their businesses here at home.

SOCMA remains engaged in the MTB process and will provide updates on how to submit petitions to the ITC in 2016. Please visit the International Trade Commission (ITC) website for up to date information on the petition process and timing.

President’s Signing of New MTB Law Huge Victory for Specialty Chemical Manufacturers
SOCMA Celebrates Senate Passage of Long-Awaited MTB Bill
SOCMA Hails House Passage of Long-Awaited MTB Bill


Industry Trade Advisory Committee for Chemical and Allied Products (ITAC-3)

The Trade Act of 1974 established a private sector advisory system to ensure that U.S. trade policy and trade negotiation objectives adequately reflect U.S. Commercial and economic interests. The advisory system is comprised of three levels.

  • The top tier is the Advisory Committee for Trade Policy and Negotiations (ACTPN). The ACTPN provides overall trade policy advice and is comprised of industry and non-governmental organizations and other special interest groups. 
  • The second tier is comprised of various Trade and Environmental Policy Advisory Committees (TEPAC). TEPACs combine representatives of special interest groups with industry representatives on specific issue areas such as labor, agriculture, etc.
  • The third tier is comprised of Industry Trade Advisory Committees (ITAC). ITACs were developed to represent the interests of specific industry sectors that tend to be impacted by trade agreements.

Membership on the ITACs is limited to those with roots in specific industry sectors. There are currently 17 ITACs, including ITAC-3 which represents the chemicals and allied products industry sectors. For more than 25 years, the ITACs have reviewed pending trade agreements and provided valuable input to government negotiators. ITAC involvement helped with negotiations approving the North American Free Trade Agreement (NAFTA) and the Uruguay Round of international trade negotiations, which led to the creation of the World Trade Organization (WTO). ITACs also provide valuable information regarding tariffs and temporary duty suspensions.

The ITACs are an effective forum for promoting the interests of batch manufacturers. The ITAC-3 is made up of approximately 30 individuals who advise the Office of the United States Trade Representative (USTR) on a number of issues. Current issues being followed by the committee are the free trade agreements, enforcement of trade agreements and intellectual property protection, REACh, Anti-Counterfeit Agreement, Bilateral Investment Treaties, Lacey Act Amendments, Strategic Economic Dialogue (SED) with China, and Joint Committee on Commerce and Trade (JCCT) with China. SOCMA’s International Trade Committee Chair, Jim DeLisi, is the Chair of the ITAC-3, and SOCMA continues to be engaged and provide input to the advisory group.


Generalized System of Preferences (GSP)

The GSP program attempts to promote economic growth in the developing world by allowing duty-free entry into the U.S. for more than four thousand products from 144 beneficiary countries and territories. The GSP was instituted in 1976, after being authorized in the Trade Act of 1974. Under the GSP program, up to 5,000 types of products from 122 beneficiary developing countries and territories, including 43 least-developed countries, are eligible for duty-free treatment when exported to the United States. In 2014, the total value of imports that entered the United States duty-free under GSP was $18.3 billion.

The House of Representatives and the Senate passed the Trade Preferences Extension Act of 2015, Title II, which revives the generalized system of preferences (GSP) that had expired July 31, 2013. It also made benefits retroactive to the date on which the program lapsed and sets a new sunset date of Dec. 31, 2017.


Regulatory Barriers to Trade

Trade improves the economic well-being of Americans, advances freedom around the world, and promotes our nation's security. The U.S. government, through the United States Trade Representative (USTR) and other agencies, is committed to promoting trade and reducing or eliminating barriers that prevent trade between the U.S. and other countries. The persistence of trade barriers applied to chemical manufacturing affirms the need for SOCMA to remain actively engaged on multiple fronts. A primary example of a commonly used strategy to hamper trade is the promulgation of overreaching regulation, such as the European Union’s REACH legislation.

SOCMA testimony to the U.S. International Trade Commission regarding European Union regulatory barriers to trade for small and medium-sized U.S. chemical manufacturers, November 2013.
SOCMA’s statement of support for Congressman Turner’s (OH-3) Trade Law Enforcement Act of 2011.

View SOCMA’s presentation on REACH as a trade barrier given to the Asia-Pacific Economic Cooperation (APEC) forum August 11, 2008 in Cuzco, Peru, here.


SOCMA’s Export Promotion Pledge

Find out what the U.S. Commercial Service can do for your company here.

US Commercial Service

Access SOCMA's Policy Statement on International Trade here.



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