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Lawmakers Still Working to Settle Differences on Customs Bill

Lawmakers are expected to soon convene a conference to resolve differences in the Trade Facilitation and Trade Enforcement Act (H.R. 644), commonly known as the customs bill, in an effort to enact this legislation into law by the end of the year. The Senate has agreed to the House’s request for a conference but the House has yet to name conferees.

While the committees of jurisdiction have expressed a strong commitment to the measure, private sector sources question whether customs modernisation will move forward this year given the crowded congressional calendar and other legislative priorities. Caroline Atkinson, a White House official, recently said that the administration hopes “Congress will move forward very soon.” She added that the customs bill has “very important” elements to build up trade enforcement, including the ability to fight dumping as well as “important disciplines strengthening currency provisions.”

Key obstacles to the bill remain opposition in the House to the Senate language reforming the miscellaneous tariff bill process as well as certain duty evasion elements. CBP strongly opposes the duty evasion language of the customs bill that would allow interested parties to challenge its decisions in a court of law. The Senate version would create a new process for CBP to investigate attempts to avoid antidumping and countervailing duties at the border. CBP would be required to initiate an investigation no later than ten business days after receiving an allegation. In contrast, the House bill would the give the DOC 30 days to determine whether it will investigate allegations of duty evasion.

On currency, the Senate version contains a controversial provision introduced by Sen. Chuck Schumer (Democrat-New York) requiring the DOC to investigate currency manipulation as a countervailable subsidy. The House version would only require the president to take action against countries that do not adopt policies to correct an undervalued currency. The administration has opposed the Senate provision but recent currency devaluations by mainland China and Vietnam are likely to increase bi-partisan support for this provision. However, a private-sector source said there is little chance the House leadership would agree to include the Senate currency provision in the bill during conference.

Another major difference between the Senate and House bills is a Senate provision aimed at reforming the MTB process. House Ways and Means Committee Chairman Paul Ryan (Republican-Wisconsin) opposes this provision as currently drafted as he considers it a violation of current House rules on “earmarks.” Earmarks are legislative provisions that provide, allocate or authorise funds or provide tax exemptions for specific projects or purposes other than through a statutory or administrative mechanism or competitive award process. Under the Senate proposal, the U.S. International Trade Commission would directly collect petitions for suspension of tariffs instead of members of Congress. The USITC would then submit recommendations to the committees of jurisdiction, which could then draft an MTB package. Rep. Ryan recently announced that Reps. Pat Tiberi (Republican-Ohio) and Mick Mulvaney (Republican-South Carolina) are working on an MTB proposal that would fully comply with House earmark requirements, although it is not clear whether such a compromise would ultimately make it into the customs bill.

Other pending issues in the customs bill concern certain climate and immigration language. The House bill contains a provision that would exclude trade agreements requiring changes to U.S. law or obligating the United States with respect to global warming or climate change from benefiting from TPA expedited procedures. The House bill would also amend TPA to ensure that trade agreements do not require changes to U.S. immigration law.

Content provided by Picture: HKTDC Research
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