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The Biden administration says the most recent round of negotiations on the Indo-Pacific Economic Framework saw continued progress but once again divulged few details. According to a joint press release from the Office of the U.S. Trade Representative and the Department of Commerce, at the fifth negotiating round held Sept. 10-16 in Thailand IPEF participants “continued to make progress on negotiations towards high-standard outcomes” on trade, clean economy, and fair economy. However, the two agencies offered no details on what that progress entailed.

There has been some speculation that IPEF talks could be concluded before or during the annual Asia-Pacific Economic Cooperation summit this November. However, following the most recent talks USTR and DOC said only that additional negotiating rounds are expected this year. For more information, click here.

U.S. Trade Representative Katherine Tai met with a number of African officials and stakeholders on a trip in July seeking to strengthen U.S. trade ties with a continent seen as increasingly influenced by China. At a recent meeting of the U.S.-East African Community Trade and Investment Framework Agreement Council, Tai welcomed “insightful conversation” on the African Growth and Opportunity Act from TIFA members Burundi, the Democratic Republic of the Congo, Kenya, Rwanda, South Sudan, Tanzania, and Uganda.

During this meeting, as well as a separate conversation with Kenyan President William Ruto, Tai said USTR will continue working with U.S. lawmakers and stakeholders on this issue but noted that Congress will make the final decision on whether to extend AGOA, revise eligibility criteria, or make other changes. AGOA – currently scheduled to expire Sept. 30, 2025 – grants duty-free access to products imported from qualifying sub-Saharan Africa countries.

Tai also spoke with President Ruto about the U.S.-Kenya Strategic Trade and Investment Partnership, which was announced in July 2022 and aims to negotiate high-standard commitments on issues such as trade facilitation, customs procedures, digital trade, good regulatory practices, agriculture, environment, labor, and standards. These negotiations could reduce tariffs and non-tariff barriers, making it easier for Virginia companies to trade with companies in Africa. For more information, click here.

The U.S. and EU are meeting in October to negotiate a global arrangement designed to (1) discourage trade in high-carbon steel and aluminum that contributes to global excess capacity from other countries and (2) ensure that domestic policies support lowering the carbon intensity of these industries.

Prospects for reaching a deal appear uncertain. U.S. Trade Representative Katherine Tai met recently with European Commission Executive Vice President Valdis Dombrovskis to discuss the talks, and USTR characterized the discussion as “direct and candid,” language typically used to signal disagreement. USTR also stressed the need for “ambitious proposals” and for working “at the deep level of trust, commitment, and confidence that characterizes the best of the partnership” between the two sides, suggesting that the White House feels Brussels’ efforts in both areas have so far been insufficient. For more information, click here.

Over the Summer, the U.S. requested formal dispute settlement consultations under the U.S.-Mexico-Canada Agreement regarding measures set out in a February 2023 Mexican decree that specifically banned the use of genetically-engineered corn in tortillas or dough and instructions to Mexican government agencies to gradually substitute (i.e., ban) the use of such corn in all products for human consumption and animal feed.

Having failed to reach an agreement during those consultations, the U.S. announced Aug. 17 that it is establishing a USMCA dispute settlement panel to hear its arguments. If this process (likely to be completed in mid-2024) results in a ruling in favor of the U.S., Mexico would be urged to revise the policies at issue. If it declines, the U.S. would be authorized to impose retaliatory measures such as increased tariffs on imports from Mexico. Virginia companies importing from Mexico may be impacted depending on how the dispute plays out. For more information, click here.

The U.S. and the United Kingdom recently announced the Atlantic Declaration for a Twenty-First Century U.S.-UK Economic Partnership, which seeks to further deepen the bilateral trade and investment relationship; build resilient, diversified, and secure supply chains; reduce strategic dependencies; and provide for ever-closer cooperation on economic security and technology protection issues.

According to a joint fact sheet, the partnership envisions a number of “concrete and coordinated actions” the two sides will take on a wide range of issues, including economic security, supply chains, and technology protection. For example, the two sides intend to update and more closely align their “toolkits” to prevent the leakage of sensitive and dual-use emerging technologies and other export-controlled commodities and technologies. The UK has been the 9th largest export partner for Virginia companies so far in 2023, and these discussions could make it even easier to do business in the UK. For more information, click here.

The U.S. and the United Kingdom recently announced the Atlantic Declaration for a Twenty-First Century U.S.-UK Economic Partnership, which seeks to further deepen the bilateral trade and investment relationship; build resilient, diversified, and secure supply chains; reduce strategic dependencies; and provide for ever-closer cooperation on economic security and technology protection issues.

According to a joint fact sheet, the partnership envisions a number of “concrete and coordinated actions” the two sides will take on a wide range of issues, including economic security, supply chains, and technology protection. For example, the two sides intend to update and more closely align their “toolkits” to prevent the leakage of sensitive and dual-use emerging technologies and other export-controlled commodities and technologies. The UK has been the 9th largest export partner for Virginia companies so far in 2023, and these discussions could make it even easier to do business in the UK. For more information, click here.

Pledging “a new era of trilateral partnership,” the leaders of the U.S., Japan, and South Korea announced a range of expanded collaboration efforts in August, including on economic issues. While many observers see the enhanced partnership as targeted at China and North Korea, National Security Advisor Jake Sullivan said it “is not against anyone … it is for something;” specifically, “a vision of the Indo-Pacific that is free, open, secure, and prosperous.”

With respect to trade, the three countries plan to launch a pilot early warning system to (1) expand information sharing and enhance policy coordination on possible disruptions to global supply chains and (2) better prepare themselves to confront and overcome economic coercion. The White House noted that this effort will enhance existing trilateral cooperation on supply chain resilience, particularly on semiconductors and batteries, as well as on technology security and standards, clean energy and energy security, biotechnology, critical minerals, pharmaceuticals, artificial intelligence, quantum computing, and scientific research. Similar early warning systems are already in place with the European Union and under consideration as part of the Indo-Pacific Economic Framework. Although not addressing tariffs in Japan, these discussions could have meaningful benefits for Virginia companies currently trading with Japan or South Korea. For more information, click here.

Negotiations under the U.S.-Taiwan Initiative on 21st-Century Trade continued to move ahead in August as the two sides work to conclude more agreements by the end of this year. The U.S. and Taiwan launched the initiative in June 2022 after Taipei was left out of the Indo-Pacific Economic Partnership due to concerns about how its inclusion might be received in China. In August 2022, officials announced a negotiating mandate envisioning high-standard commitments and economically meaningful outcomes in areas such as trade facilitation, good regulatory practices, small and medium-sized enterprises, agriculture, standards, digital trade, labor and environment, state-owned enterprises, and non-market policies and practices.

The Office of the U.S. Trade Representative reports that at the latest in-person negotiations, held in Washington Aug. 14-18, the two sides exchanged views on proposed texts covering agriculture, labor, and the environment. “The conversations were productive,” USTR said, “and officials will continue to hold discussions in the months ahead in order to reach consensus.” Taiwan is a relatively small trading partner to the United States, but these discussions could open up future opportunities for Virginia companies looking to export their goods or do business in Taiwan. For more information, click here.

President Biden visited India and Vietnam recently to strengthen U.S. trade, economic, and other ties amid a continuing effort to “de-risk” supply chains from over-reliance on China. In India, the two sides announced an agreement to resolve their last remaining dispute at the World Trade Organization regarding restrictions India imposed more than a decade ago on imports of U.S. poultry (an agreement to resolve six other disputes was announced in June). Under this agreement India has agreed to reduce its import tariffs on U.S. frozen turkey, frozen duck, and fresh, frozen, dried, and processed blueberries and cranberries.

In Vietnam, the U.S. announced that the two countries have elevated their relations to a comprehensive strategic partnership through which they will “continue to deepen cooperation” in a wide range of areas. On trade, this includes a pledge to create favorable conditions and facilitate further market opening for each other’s goods and services, to support regulatory measures toward that end, and to address issues such as market access barriers via the existing bilateral trade and investment framework agreement. They also mentioned other longstanding issues such as economic reforms, exchange rate management, labor rights, and intellectual property rights. For more information, click here.

Commerce Secretary Gina Raimondo was recently in China, the latest senior U.S. official to visit the economic giant in recent months as Washington continues its efforts to stabilize what has become an increasingly tenuous relationship. Though the two sides still do a massive amount of business with each other, bilateral trade tensions have only increased in recent years amid mutual tariff hikes, export restrictions and other measures.

Secretary Raimondo and Chinese commerce minister Wang Wentao agreed August 28 to several measures, including a new commercial issues working group to seek solutions on trade and investment issues and advance U.S. commercial interests in China. The U.S. will host the first meeting in early 2024. Moreover, a new export control enforcement information exchange will be launched to help reduce misunderstanding of U.S. national security policies, and its first in-person meeting occurred at the assistant secretary level in Beijing on August 29. For more information, click here.

Government officials recently held the third meeting of the Timber Working Group that oversees implementation of an October 2021 trade agreement between the United States and Vietnam. USTR signaled that the Vietnam agreement remains a priority issue for the U.S. and that punitive measures are a possibility if sufficient progress is not made. For now, however, USTR simply said that it “will continue to closely monitor Vietnam’s implementation of the timber agreement and that the U.S. and Vietnam will “continue close cooperation in advance of a fourth Timber Working Group meeting.”

The October 2021 agreement dates back to October 2020 when the Office of the U.S. Trade Representative initiated a Section 301 investigation into Vietnam’s acts, policies, and practices related to timber imports (much of which is used to manufacture wood products that is then subsequently exported). At the time, USTR said available evidence suggested that a significant portion of the timber Vietnam imports that has been harvested or traded in violation of Vietnam’s domestic laws, the laws of exporting countries or international rules. Although not imminent, this could make it harder for Virginia companies to import timber from Vietnam. For more information, click here.

The U.S. and Mongolia on Aug. 2 held the strategic Third Neighbor partnership as part of efforts to further expand bilateral ties with a focus on building economic resilience, promoting democratic principles and institutions, and strengthening security cooperation. Deepening economic ties with resource-rich Mongolia could be a way for the U.S. to reduce its dependence on China for various critical minerals. Although a small market for Virginia companies, the developments of these discussions could make it easier to do business in this market. For mor information, click here.

The President’s Export Council, meeting for the first time in seven years, recently offered several recommendations on ways the White House can further promote U.S. exports. The PEC also received the Biden administration’s latest National Export Strategy, which establishes U.S. trade promotion priorities and highlights federal government programs and resources that can help U.S. businesses overcome barriers to exporting to other markets.

The PEC called on the president to launch a new interagency strategy to promote trade facilitation abroad. With the goal of achieving durable results in U.S. export markets, the PEC said, this strategy would establish trade facilitation as a key U.S. economic goal both in implementing existing agreements and programs and guiding agencies negotiating future agreements and programs, such as the Indo-Pacific Economic Framework for Prosperity and the Americas Partnership for Economic Prosperity. In addition, as part of a broader effort to enhance U.S. competitiveness, the PEC recommended that the Department of Commerce align export promotion programs with place-based investment and competitiveness initiatives. These developments could improve the ease of doing business abroad. For more information, click here.

Acting Commissioner Troy Miller said recently that U.S. Customs and Border Protection is starting to take steps to implement the Green Trade Strategy it first announced a year ago, which included four broad goals: incentivizing green trade, strengthening environmental enforcement, accelerating green innovation, and improving climate resilience and resource efficiency. However, little appears to have been done on most of the more significant trade-related measures outlined in that strategy.

At the inaugural Green Trade Forum held recently near Washington, D.C., Miller provided an update on what CBP is doing to advance these goals, but he said little about some of the more fundamental changes that are likely of particular interest to the trade community. He did note that CBP is continuing to review how green trade provisions might be incorporated into existing authorized economic operator programs. Perhaps in reference to other, specifically customs-related changes, however, he said only that CBP will keep engaging with industry partners, non-governmental organizations, and academic institutions to solicit ideas and perspectives. For more information, click here.

Litigation seeking to overturn Section 301 tariffs on hundreds of billions of dollars’ worth of imports from China moved forward recently when importers filed their first brief with the Court of Appeals for the Federal Circuit. Importers of subject goods can still join this effort, which could ultimately yield refunds of duties imposed. A case first filed in 2020 and since joined by thousands of importers argues that the Section 301 tariffs on List 3 and List 4A goods from China were wrongly imposed. In March 2023 the Court of International Trade ruled in favor of the federal government, leaving the tariffs in place for now.

The CAFC is expected to receive additional briefings and arguments in this case over the next few months and a decision is anticipated sometime in 2024. If this case is ultimately successful, refunds of all Section 301 tariffs paid on List 3 and List 4A goods will potentially become available. Importers can still preserve their rights to possible refunds of these tariffs by joining the litigation. For more information, click here.

The Court of Appeals for the Federal Circuit’s July 27 decision involves a challenge to a U.S. Customs and Border Protection determination under the Enforce and Protect Act that an importer evaded antidumping duties on pencils from China by transshipping them through the Philippines. CBP’s determination relied on evidence (including photographs, information about invoices and purchase orders, and verification reports) that was redacted from the information provided to the importer. The importer was also denied the opportunity to rebut this evidence.

The CAFC held that CBP’s failure to provide the importer with access to this information was “a clear violation” of the importer’s due process rights under the Constitution. “One relatively immutable principle of due process is that ‘where governmental action seriously injures an individual, and the reasonableness of the action depends on fact findings, the evidence used to prove the [g]overnment’s case must be disclosed to the individual so that he has an opportunity to show that it is untrue,’” the court said. “This immutable principle applies to cases where facts have been withheld from an entity during an administrative proceeding.” This appeals court decision could make it easier for companies importing their goods to prove their products are not made with forced labor. For more information, click here.

Earlier this year the Bureau of Industry and Security announced policy changes designed to incentivize the submission of voluntary self-disclosures when businesses uncover significant possible violations of the Export Administration Regulations. Those changes followed others announced in 2022 that promised quicker resolution of VSDs involving minor or technical infractions.

In a “tri-seal compliance note” issued in conjunction with the Department of Justice and the Office of Foreign Assets Control, BIS is now further clarifying that “companies cannot sidestep the ‘should we voluntarily self-disclose or not’ decision by self-blinding and choosing not to do an internal investigation in the first place.” BIS adds that “the existence, nature, and adequacy of a company’s compliance program, including its success at self-identifying and rectifying compliance gaps, is itself considered a factor under the settlement guidelines.” Virginia companies exporting their goods abroad should understand these changes, and adapt accordingly. For more information, click here.

The Census Bureau is amending its regulations to reflect effective from November 8 new export reporting requirements related to the State Department’s Directorate of Defense Trade Controls Category XXI Determination Number. Specifically, Census is adding a conditional data element – DDTC Category XXI Determination Number – when “21” is selected in the DDTC USML Category Code field in the Automated Export System to represent United States Munitions List Category XXI. Virginia companies involved in the exportation of munitions or other weaponry will need to understand these new requirements. For more information, click here.