• Senate Finance Committee Considers Bill to Renew Expedited Procedures for Approval of Trade Agreements
  • January 31, 2014
  • Law Firm: Dentons Canada LLP - Toronto Office
  • On January 16, 2014, the Senate Finance Committee held a hearing, Advancing Congress's Trade Agenda, The Role of Trade Negotiating Authority. The purpose of the hearing was to discuss a bill introduced on January 9th — the Bipartisan Congressional Trade Priorities Act of 2014 (H.R. 3830) — to expedite the process for obtaining Congressional approval of trade agreements negotiated by the Office of the U.S. Trade Representative (USTR). Specifically, the bill would renew 'Fast-Track' procedures for the consideration of trade agreements. These procedures, first instituted in 1974, require Congress to:

    • vote 'yes' or 'no' on trade agreements without making any amendments, and
    • conduct deliberations within a certain timeframe.

    The introduction of the bill — and its consideration by the Senate Finance Committee — is important for companies who are waiting to take advantage of new market access opportunities under the Trans-Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (T-TIP), and the plurilateral Trade in Services Agreement (TISA). According to the heads of the Congressional committees that oversee trade, 'Fast-Track' procedures — also known as Trade Promotion Authority (TPA) — must be renewed in order for the TPP, T-TIP, and TISA to result in successful outcomes. This is because — as articulated by former USTR Rob Portman, now a Senator from Ohio — it is important that our trading partners know that the deals they reach with U.S. negotiators will not be undone by Congress during ratification.

    In order for H.R. 3830 to become law it must be passed by both the House and the Senate, though it is not yet clear when these votes will occur. If signed into law, the new 'Fast-Track' authority would expire on July 1, 2018.

    While the discussion that took place during the January 16th hearing indicates that a number of Democratic and Republican Committee members support TPA renewal, the hearing also shed light on concerns held by some Committee members — notably Senators Benjamin Cardin (D-MD), Sherrod Brown (D-OH), Robert Casey (D-PA), and Robert Menendez (D-NJ) — over U.S. trade policy, including trading partners' governance issues, provisions in agreements that allow investors to sue states, and U.S. enforcement of intellectual property rights. Earlier, on January 9th, these Senators (plus Senator Debbie Stabenow (D-MI) had sent USTR Michael Froman a letter calling for any TPA renewal to provide for greater consultation with Congress.

    The TPA bill contains provisions that address to some extent concerns such as these, i.e., that USTR does not consult sufficiently with Congress during trade negotiations. It requires USTR to meet with any Member of Congress to discuss the status of any trade negotiations, and to share classified negotiating materials with that Member.

    TPA May Be Tied to Renewal of Trade Adjustment Assistance, Generalized System of Preferences

    Any renewal of TPA will likely occur in tandem with the reauthorization of Trade Adjustment Assistance (TPA), a federal program that provides benefits to U.S. workers who have lost their jobs because of the dislocation caused by trade. Not only does the Chairman of the Senate Finance Committee currently support the reauthorization of TAA alongside TPA renewal, but also TPA renewal bills have often contained provisions reauthorizing TAA in the past.

    Another trade-related program that may be tied to renewal of TPA is the Generalized System of Preferences (GSP), which allows imports from certain countries to enter the U.S. duty-free. GSP extensions also have been included in bills to renew TPA in the past.