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Congress Passes Key SFIA-Backed TPA, Trade Preference Bills

Date: 6/30/15

          In a major victory before departing for the 4th of July recess, Congress passed the long-awaited trade promotion authority (TPA) and GSP/trade preference bills.  Both measures had been strongly backed by SFIA and will be of major benefit to companies in the sports and fitness industry.  The White House has indicated President Obama will sign both bills into law as soon as they reach his desk.

TPA passage key to upcoming trade agreements

The final phase of a convoluted legislative process began with the House’s passage of a TPA standalone bill (H.R. 2146) on June 18 in a 218-208 vote.  On June 24 the Senate passed the bill by a 60-38 margin, one day after its 60-37 approval of a cloture motion that required 60 votes.  That completed congressional action on TPA, except for a fix to the bill’s human trafficking provision that will be made via customs legislation that is headed to conference (as currently written, the provision would prevent trade promotion authority from being used with respect to Malaysia and, hence, to a Trans-Pacific Partnership (TPP) agreement).

To review, TPA is important to SFIA members because it is a practical necessity to securing congressional approval of the soon-to-be-completed TPP agreement involving the United States and 11 other Asia-Pacific countries.  TPA is also needed for a later U.S.-EU Transatlantic Trade and Investment Partnership (TTIP) agreement, as well as any other major trade agreement such as a possible Doha Round WTO agreement. 

Trade preferences bill includes long-awaited GSP renewal

On June 24 the Senate passed by voice vote the GSP/trade preferences bill (H.R. 1295) that had been modified to also include trade adjustment assistance.  The House followed suit in approving the bill by a 286-138 margin the next day. 

The GSP/trade preferences bill will extend the U.S. Generalized System of Preferences, which provides duty-free treatment for 140 beneficiary developing countries for nearly all dutiable categories of sporting goods equipment, until December 31, 2017.  The GSP extension, which takes effect 30 days after the President signs the legislation, will be retroactive to the program’s July 31, 2013 expiration.  The bill also extends the African Growth & Opportunity Act (AGOA) and two Haiti-specific preferential programs. 

In addition, the bill includes a provision that will allow the filing of petitions requesting that travel goods (including such items as gym bags) of textiles or leather be added to GSP eligibility, and provisions reclassifying water-resistant performance footwear and recreational performance outerwear.

Further action needed on customs/trade enforcement bill

The only trade bill action remaining outstanding at this time is the House-Senate conference on the customs/trade enforcement bill (H.R. 644).  That conference will determine, inter alia, the fate of the miscellaneous tariff bill (MTB) reform provision that is contained in the Senate version of the bill.  Although the provision was intended to address the concerns of some Members that duty suspensions are akin to earmarks, the House leadership felt those concerns were not adequately addressed and it removed the MTB provision from the House-passed version of the bill

Conferees also will need to address several other differences between the House- and Senate-passed versions of the customs legislation.  In addition to the MTB provision and the TPA-critical human trafficking provision fix noted above, these include differences in the bills’ handling of currency manipulation, restrictions on the inclusion of climate change or immigration provisions in TPA-eligible trade agreements, duty evasion, Israel commercial relations, importer identity, and CBP authorization.

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