|
|
|
español - français - português |
Search
|
|
|
|
español - français - português |
|
Search
|
|
TPD > FTAA > United States Negotiating Positions - Summary > Position |
|
Summary of the United States Negotiating Positions in the FTAA |
FTAA NEGOTIATING GROUP ON MARKET ACCESS Public Summary of U.S. Position The FTAA Negotiating Group on Market Access (NGMA) has the responsibility for conducting the negotiation for the elimination of tariffs on trade between the 34 FTAA countries. In addition the NGMA was tasked with drafting rules and disciplines in the following areas: tariffs and non-tariff measures, rules of origin, origin procedures, customs procedures, safeguards and technical barriers to trade. The U.S. positions on all these issues are provided below. TARIFF NEGOTIATION Before countries can exchange tariff concessions on a product-specific basis, they must agree on the fundamental rules and parameters for duty elimination, including certain negotiating methods and modalities. These methods and modalities include such things as the base rate or starting point from which tariffs will be reduced, the timetable and pace of tariff elimination, the method for determining concessions, product classification and the reference period for trade data. The U.S. position on methods and modalities advocates fair and reasonable procedures that will ensure that the benefits of free trade are broadly distributed. It provides for rapid reduction of most duties, while also taking into account product sensitivities in a framework that is fully consistent with the disciplines of the World Trade Organization (WTO). At their 1998 meeting in San Jose, Costa Rica, Trade Ministers from the 34 Western Hemisphere countries participating in the FTAA process agreed that all tariffs would be subject to negotiation. WTO rules (Article XXIV of the General Agreement on Tariffs and Trade 1994 and its Uruguay Round Understanding) require parties to a free trade area to eliminate duties on substantially all trade between their territories in a period that normally should not exceed ten years. To ensure that phased duty reductions produce genuine market opening, the United States has proposed that the base rate from which tariffs are phased out be the lower of a product's most favored nation (MFN) applied rate in effect during the FTAA negotiations or the WTO bound rate at the end of the FTAA negotiating process. Mindful that some industries will need more time than others to adjust to an open market, the U.S. proposes that the FTAA countries establish three different categories or "baskets" for tariff reduction. Tariffs on some products would be eliminated immediately upon entry into force of the Agreement, and others would be gradually phased down over five or ten years. Each FTAA country would include the same proportion of its imports (by value) in each of these categories, and the determination of what products fall into which baskets would be the result of a request-offer bargaining process. Each FTAA country would eliminate a high proportion of its tariffs within five years. The United States also suggests that FTAA countries might agree to early elimination of tariffs in particular industry sectors. The United States reserves its position on whether each country may negotiate only one schedule of tariff concessions for all FTAA countries or may negotiate different schedules for different FTAA countries. The United States suggests that FTAA negotiations be conducted using the tariff nomenclature of the 1996 Harmonized System (HS) of product categories, taking into account changes in the HS planned for 2002 as appropriate. The United States proposes using 1998 as the base year for trade data, since that is the year the negotiations were initiated. A common benchmark for trade data could be important for purposes of determining "principal suppliers," or those with special negotiating rights. TARIFFS AND NON-TARIFF MEASURES TEXT The United States proposes procedures and disciplines governing the reduction and elimination of tariffs and the application of certain non-tariff measures to goods traded between FTAA countries. This approach is designed to create new export opportunities for U.S. companies and workers by establishing a fair and level playing field, reducing commercial transaction costs, eliminating or disciplining import and export restrictions, and increasing regulatory transparency. Establishing a level playing field The United States believes the FTAA Agreement should require each FTAA country to grant "national treatment" to goods of any other FTAA country in accordance with Article III of the General Agreement on Tariffs and Trade 1994 (GATT 1994). This means that FTAA countries must treat imported goods no less favorably than they treat like domestic goods in respect of all laws, regulations and requirements affecting their sale, purchase, transportation and use. In addition, the United States proposes special recognition for Bourbon and Tennessee Whiskey as distinctive products, so that other FTAA countries would prevent the domestic sale of such products unless they were manufactured in the United States in accordance with U.S. laws and regulations. Reducing transaction costs The U.S. proposes that the FTAA Agreement lower the cost of doing business in the hemisphere by eliminating tariffs and other expenses, prohibiting "consular transactions," establishing simple procedures for the temporary admission of goods related to business travel and permitting duty-free entry of commercial samples and advertising materials. U.S. positions generally would prevent FTAA countries from increasing existing tariffs or adopting new duties on FTAA goods. The U.S. approach would also require FTAA countries to progressively eliminate, according to a schedule attached to the FTAA Agreement, tariffs and other fees or charges they impose which are not related to an import service. In addition, the U.S. proposes ending consular transactions for FTAA goods, including related fees. Consular transactions are requirements that customs documents accompanying goods of one country intended for export to another must first be certified by the consul of the importing country. The United States proposes clear and practical procedures for the temporary admission of goods related to business travel, including software, broadcasting and cinematographic equipment, commercial samples, advertising films, and containers and commercial vehicles for the transport of goods. Consistent with the customs business facilitation measures agreed by Trade Ministers at their 1999 meeting in Toronto, the United States proposes an allowable time period for temporary admission (one year) and requires FTAA countries to establish procedures for the expeditious release of goods accompanying business travelers. FTAA countries would be required to also allow goods to be exported through a customs port other than the one through which they were imported. Subject to certain conditions and restrictions, the United States proposes that the FTAA Agreement obligate FTAA countries to permit definitive duty-free entry of certain commercial samples and advertising materials. Eliminating import and export restrictions The U.S. position would guarantee fair market access in the hemisphere by breaking down costly export and import restrictions and preventing countries from replacing falling duties with new non-tariff barriers. In particular, the FTAA should prohibit export and import price requirements, import licensing conditioned on the fulfillment of a performance requirement, and voluntary export restraints not allowed under the WTO. It should also eliminate discriminatory export taxes and, consistent with Article VIII of the GATT 1994, ensure that all fees and charges imposed on or in connection with importation or exportation are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to domestic products or a taxation of imports or exports. In addition, the U.S. position would capitalize on commercial innovation and promote sound environmental policy by preventing FTAA countries from maintaining prohibitions or restrictions on the importation of remanufactured goods. FTAA countries could require that remanufactured goods be identified as such and that they meet any standard applicable to new like goods. Increasing transparency The U.S. proposes meaningful and enforceable transparency provisions for both import licensing procedures and fees imposed in connection with importation or exportation. These provisions would not only provide valuable and reliable information to the trading community but also help member countries monitor compliance with the Agreement. Upon entry into force of the FTAA Agreement, each FTAA country would be required to notify all existing import licensing procedures and fees imposed in connection with importation and exportation to all other FTAA countries. Thereafter, they must notify any new procedures or fees and changes to existing procedures or fees within 60 days of publication. Notification of procedures and fees is without prejudice to whether they are consistent with the rights and obligations of the FTAA Agreement. Any procedures or fees not notified may not be enforced against the other FTAA countries. RULES OF ORIGIN The rules of origin will determine which goods exported from one FTAA country to another qualify for FTAA tariff preferences. The United States seeks origin rules that are objective, transparent, easy to administer and easy to comply with. The United States proposes using the "specific tariff shift" approach to determining rules of origin. This will require negotiating for each product or sector the degree of product transformation that must occur, as represented by a change in tariff nomenclature categories, in order for origin to be conferred. This is the predominant approach that was used in the NAFTA rules of origin. The United States has reserved its position with respect to the issue of permitting "accumulation" of production across FTAA countries in qualifying for origin, and it has reserved its position with respect to de minimis rules. The United States has opposed the introduction into the Origin Chapter of the FTAA Agreement of special and differential treatment for certain countries. The United States believes that the FTAA Agreement should avoid using complicated or ill-defined value tests as the basis for determining origin, in order to minimize burdens and uncertainties for traders. Value tests, which confer origin on the basis of the percent value added in a country (or group of countries if the FTAA Agreement were to allow accumulation), can be simple in concept, but difficult for governments and businesses to apply. Complex accounting is required to allocate manufacturing overhead and other corporate costs to the cost of producing a particular good. Moreover, the results of value tests can be difficult to predict due to fluctuations in exchange rates and factor prices. Thus, in certain cases companies could not make investments with certainty as to whether their products would qualify for FTAA preferences. The United States proposal also does not advocate using a "uniform tariff shift" approach, which would confer origin on any transformation of a product which causes it to shift HS tariff categories at a particular level of digits (e.g., four). This approach could lead to widely inconsistent results across products, as the HS categories were not drafted to imply that a substantial transformation occurs at any particular level of digits in the nomenclature. ORIGIN PROCEDURES In addition to rules of origin, a free trade regime requires procedures for handling claims for tariff preferences. The United States wishes to avoid unnecessary requirements that add costs to trade but provide no enforcement benefit. The United States proposes a system of administration that is trade-friendly by allowing claims for preference to be written or electronic, and made by the importer, exporter or producer. The certification need not be in a prescribed form, provided it contains certain data elements. The United States proposes a system designed to encourage trade by providing the exporter or producer with more certainty that his export will be given fair treatment by guaranteeing inter alia advance rulings, review and appeal procedures, and confidentiality with respect to origin procedures. The United States has not supported using certifying entities because they impose extra costs and delays, are generally not in a position to attest to the claims that they "certify" and are not legally liable for their certifications. CUSTOMS PROCEDURES In addition to mandating negotiators to develop the customs procedures necessary to administer an origin regime, the negotiators are called on "to simplify customs procedures, in order to facilitate trade and reduce administrative costs..." and "...to promote customs mechanisms and measures that ensure operations be conducted with transparency, efficiency, integrity and responsibility." Toward that end, the major objectives of the United States with regard to the FTAA customs procedures chapter can be summarized as follows: Transparency of customs procedures and their administration Establishment of an advance rulings regime Institution of a review and appeals process for customs decisions Full integration of the adopted customs-related business facilitation measures Implementation of a two-step entry process 1. Transparency of Procedures and their Administration The United States proposes that the customs procedures chapter require all FTAA countries to make publicly available information regarding customs laws, regulations, guidelines, procedures and rulings. The chapter should require customs administrations to post detailed information on requirements, to establish points of contact for addressing inquiries from the public regarding customs requirements and, to the extent practicable, to permit public comment on proposed regulations that will have an impact on the trade community. Making this information available to the public would permit the trade community to be better prepared to comply with customs requirements. Understanding the process would permit them to better plan their transactions, anticipate what information will be required from Customs and when, and ensure the smooth flow of goods within commercial and production schedules. Customs administrations also achieve greater efficiency because higher compliance among traders would require less resources to handle repeated processing of improper documentation. 2. Establishment of an advance rulings regime The United States proposes that FTAA countries be required to provide a system for issuing advance rulings prior to importation of a good, upon written request from authorized parties. Such rulings could address inter alia determinations of tariff classification, customs valuation or country of origin. The ruling that is issued is a definitive interpretation of the customs laws and regulations as they apply to the given transaction, and is based on information supplied by the requester. The rulings are binding on the customs administration and on the requester, provided the actual importation conforms to the circumstances outlined in the ruling request. This process reduces arbitrariness and introduces an additional measure of predictability that permits the trade community to anticipate and comply with customs requirements. It also facilitates trade by lessening the time customs administrations need to make decisions at the border. 3. Institution of a review and appeals process for customs decisions Just as the publication of requirements and issuance of advance rulings create increased predictability and facilitate movement of merchandise for legitimate traders, the existence of appeals provisions for customs determinations is essential. The United States proposes that countries incorporate review and appeals mechanisms into their customs operations to ensure that the trade community has an avenue of redress for decisions which they believe are unfair or inconsistent. Although the specific mechanisms would differ across countries, the principal elements involve means to review the decision at a higher level within a customs administration, with ultimate recourse to judicial review. 4. Full integration of the approved customs-related business facilitation measures The United States advocates the integration in the customs procedures chapter of disciplines related to the eight customs-related business facilitation measures approved by the Toronto FTAA Ministerial. These measures include: provisions for temporary admission; expedited procedures for express consignments; facilitative measures for low value shipment transactions; provision for electronic data exchange; establishment of codes of conduct for customs officials; and implementation of risk management. 5. Implementation of a two-step entry process One of the most significant reforms sought by the United States is FTAA countries' implementation of a two-step entry process that separates the release of merchandise from final payment of duty. These procedures contemplate the use of financial guarantees for duty payment, time targets for release of merchandise, and final computation of duty obligations following release. Such a two-step entry process would enable importers to obtain goods much more rapidly and to reduce dramatically the time and costs associated with customs processing, since merchandise would be able to leave customs custody quickly - before completion of administrative requirements. Such procedures are also a natural extension of better enforcement targeting through risk management, the ability to process information prior to arrival as part of electronic data interchange, and the implementation of facilitative measures for certain classes of goods, such as low value shipments and express consignments. Better access to information, along with improved analytical tools and financial securities, would enable customs administrations to better facilitate the movement of goods while continuing to collect appropriate duties and fulfill other enforcement responsibilities. SAFEGUARDS With regard to the FTAA chapter on safeguards, the United States believes that there should be provisions on hemispheric safeguard measures describing the conditions for FTAA countries to suspend their FTAA tariff elimination commitments to address injury caused by the reduction of duties under the FTAA Agreement. The United States also believes that there should be provisions addressing FTAA countries' rights and obligations with respect to fellow FTAA countries when taking safeguard measures under World Trade Organization (WTO) rules. Hemispheric Safeguard Measures Purpose and Form: The United States believes that there should be a hemispheric safeguard mechanism designed to guard against or remedy import injury suffered by a domestic industry due to duty reductions or elimination under the FTAA Agreement, and to facilitate adjustment of that industry. Such measures would be only in the form of tariff increases. Neither tariff rate quotas nor quantitative restrictions would be permissible safeguard measures under the proposal. Conditions: FTAA countries would have to conduct investigations and observe transparency requirements before imposing a hemispheric safeguard measure. The countries would have to show that imports of goods originating from the territories of the other FTAA countries had increased in quantity (either absolutely or relative to domestic production) as a result of the reduction or elimination of a duty under the FTAA Agreement. Also, before taking an FTAA safeguard measure an FTAA country would have to determine that the imports in question are a substantial cause of serious injury, or threat thereof, to a domestic industry. For cases in which delay would cause damage difficult to repair and where an FTAA country determines preliminarily that there is clear evidence that the conditions described above prevail, there should be provisional safeguard measures. Such provisional measures could not exceed 200 days. The pertinent investigation would need to meet strict transparency requirements. If the full investigation determines that a safeguard measure is unwarranted, excess duties that had been imposed at the time of the action would be promptly refunded. Investigation Procedures and Transparency Requirements: These cover filing of petitions; investigation by competent authorities including public notice and a public hearing, deliberation and public report; and consultation with other Parties and notification of results to them. Duration of Safeguard Mechanism: The United States believes that there should be recourse to hemispheric safeguard measures only during a transition period of ten years. The period would begin on the date of entry into force of the FTAA Agreement. Duration of Measures: Hemispheric safeguard measures could be applied only once against the same good and for no longer than three years, including any extension. The measures would have to terminate at the end of the transition period. Nature of Measures: FTAA countries could either suspend further duty reduction on the good in question or increase the duty on the good. If the choice is to increase a duty, it could only be increased to the lesser of the most-favored nation (MFN) applied rate of duty in effect at the time the measure is imposed or to the rate in effect on the day immediately preceding the date the FTAA Agreement entered into force. Special rules would apply in the case of a duty applied to a good on a seasonal basis, similar to the NAFTA. End of Application: Upon termination of a hemispheric safeguard measure, an FTAA country could either: 1) apply the rate of duty in the tariff elimination schedule that would have been in effect had the hemispheric safeguard never been applied, or 2) proceed to eliminate the duty in effect in equal annual stages, but keeping to the scheduled date for elimination of the tariff initially set out in the FTAA Agreement. Rights of Affected Parties: The United States calls for an FTAA country imposing a hemispheric safeguard measure to provide substantial suppliers of the product concerned mutually agreed trade liberalizing compensation. Such compensation would have to be in the form of tariff concessions that have substantially equivalent trade effects or are equivalent to the value of additional duties expected to result from the measure. Failure within a prescribed 30-day consultation period among the affected parties to reach agreement on compensation could result in any FTAA country that is a substantial supplier retaliating by suspending equivalent concessions to the trade of the FTAA country applying the safeguard measure. Other Provisions: In addition to these basic provisions, the United States reserves its right to propose at a later date provisions on dispute settlement panel review specific to hemispheric safeguard measures, and sector-specific safeguard regimes. Global Actions The United States believes that each FTAA country should retain its rights and obligations under Article XIX of GATT 1994 and the WTO Agreement on Safeguards. The FTAA Agreement should not confer any additional rights or obligations on the FTAA countries with regard to actions taken pursuant to Article XIX of GATT 1994 and the WTO Agreement on Safeguards. In other words, FTAA partners would not be exempt from an FTAA country's global safeguard action under the WTO. TECHNICAL BARRIERS TO TRADE Among the objectives set forth for the Negotiating Group on Market Access is "...to eliminate and prevent unnecessary technical barriers to trade in the FTAA..." The United States has not made a proposal in this area, but is taking a range of options into consideration in determining the best means of achieving the goal of eliminating and preventing unnecessary technical barriers to trade in the Hemisphere. The WTO Agreement on Technical Barriers to Trade (TBT) was drafted with a view to preserving the Parties' rights to fulfill legitimate objectives (such as protection of human health or safety and the environment) while avoiding the imposition of measures that are unnecessary or discriminatory technical barriers to trade. The United States is examining, in consultation with interested parties, whether it is appropriate to clarify or expand upon these existing rules or whether doing so would create new problems. |
|
