Resources Industry News  

10-19-2011 - Shining Moment on the Economic Horizon - Trade Bills Passed!



It’s been a busy time for trade bills in Congress.  On October 12, 2011, the House of Representatives passed the Senate’s version of the Generalized System of Preferences (GSP) which included extension of the Trade Adjustment Assistance (TAA) and an increase in the Merchandise Processing Fee (MPF).  This concludes the long awaited agreement by which importers will receive a refund of duties, retroactive from January 1st 2011.  GSP is extended through July 31, 2013.  The bill now goes to the President, who is expected to sign it into law on October 21 and it takes effect approximately November 5, 2011.

Also on October 12, 2011, both the House and Senate passed legislation to implement the free trade agreements with South Korea, Colombia, and Panama.  The Colombia FTA bill contains a retroactive renewal of the Andean Trade Preference Act/Andean Trade Promotion and Drug Eradication Act (ATPA/ATPDEA) through July 31, 2013. The bills will now go to the President, who is expected to sign them into law on October 21 2011.  The FTAs will not enter into force until January 2012.

Immediately after President Obama signs the implementing legislation, the United States will schedule cooperative work with Korea, Colombia, and Panama on implementing the agreements. The United States will hold discussions with the partner countries to review both countries’ laws and regulations, and ensure compliance with the obligations of the agreement that will take effect on the day the agreement enters into force. U.S. officials will also consult with Congress and with U.S. stakeholders.

The provisions of the FTAs provide for entry into force through the exchange of formal diplomatic notes at a time agreeable to both countries. In the United States, the President must first determine that the trading partner has come into compliance with obligations that will take effect when the agreement enters into force. This includes, in the case of Korea, the pertinent obligations of the 2011 exchange of letters on autos. In the case of Colombia, the Administration will also ensure that Colombia has successfully implemented key elements of the Labor Action Plan before bringing that agreement into force.

Following the entry into force of each agreement, work continues at the Office of the U.S. Trade Representative to ensure that each partner country remains in compliance with its immediate obligations, and comes into compliance with obligations that take effect later on. As with all U.S. trade agreements, USTR will monitor compliance and actively enforce U.S. rights under these three trade agreements going forward. 

The Trade industry is hopeful full implementation of the FTAs will occur by Spring 2012. 

Please contact your GSB representative for questions or email, info@geosbush.com