ICYMI: A Bill in the Senate to Tighten Trade Enforcement Rules

By Matthew McMullan
Apr 23 2021 |
The ol’ Herbert C. Hoover Building in Washington D.C., the headquarters for the U.S. Department of Commerce. | Getty Images

Effort seeks to do away with legal “whack-a-mole” in trade disputes.

The American steel industry has long faced international competition that isn’t exactly playing fairly, and over the years it has brought hundreds of trade cases to the U.S. International Trade Commission (ITC) to avail itself of the things like anti-dumping and countervailing duty laws to level the playing field and make sure it isn’t getting priced out of existence by state-owned steel giants.

Those laws aren’t exactly airtight, though. Chinese steel manufacturers, for example, have in the past routed the steel they made to the American market through third-party countries to avoid tariffs they had picked up. Or who could forget the saga of the 500,000 tons of aluminum that has bounced between Mexico and Vietnam?

“There are rules!”

Anyway: In an effort to do away with this game of legal whack-a-mole, in which plaintiffs in ITC cases have to file specific suits about specific products from specific countries, Ohio’s two senators – Sherrod Brown (D) and Rob Portman (R) – last week proposed legislation that would significantly tighten existing trade remedy rules. They’re calling it the Eliminating Global Market Distortions to Protect American Jobs Act. From Brown’s release:

Under this bill, domestic industries will have the power to seek expedited relief in situations where a U.S. company has successfully fought for relief under U.S. trade remedy laws only to face a new surge in imports of the same product from another country that’s not impacted by the initial relief order.

It would address “the growing problem of cross-border subsidization, as foreign governments subsidize their own manufacturers not only at home but in third country markets as well,” and require the U.S. Department of Commerce (of which the ITC is a part) to issue preliminary determinations in “repeat offender” cases so that plaintiffs that have successfully argued for relief aren’t forced to start from square one when a new import surge of the same product from a different country that’s not impacted by the initial order.

It also would require Commerce to investigate “allegations of currency undervaluation in circumstances where the allegations meet the criteria for investigation under the existing countervailing duty law.” That’s a good addition, as a trading partner undervaluing its currency is a real drag on growth and employment in the United States.

You can read more details on the contents of Brown and Portman’s legislation here.