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The Obama Administration’s Record on Trade Enforcement: More Resources and Real Results

06/24/2014 - 6:45pm

An unprecedented emphasis on leveling the playing field for American workers and businesses

U.S. Trade Representative, Ambassador Michael Froman is joined by Senator Debbie Stabenow and Congressman Sandy Levin last month to announce a key victory against unfair duties places on American-made cars by China

Tough monitoring and enforcement is required if trade agreements are to bring their full benefit to America’s businesses, families, farmers, and workers.  That’s why the Obama administration has undertaken the most ambitious upgrade of trade enforcement in the history of modern U.S. trade policy, building a far more capable enforcement system.   The result is a high volume of new disputes, and a strong record of success that is providing tangible results in our efforts to level the playing field for American workers and businesses. 

In the last two months alone we have seen victories in two important trade enforcement cases that have benefited U.S. auto workers and U.S. producers of high-tech goods that utilize rare earth materials. In addition to enforcement in the WTO, the Administration is pursuing additional dispute settlement through our free trade agreements to protect labor rights and enhance environmental protections. 

MORE RESOURCES:  The Obama administration has made a concerted effort to enhance the capacity of the United States to enforce our trade agreements.  The capstone on this effort is the 2012 creation of the Interagency Trade Enforcement Center (ITEC).  ITEC is a USTR-led body with 22 trade analysts with expertise in a wide range of areas needed for successful enforcement.  ITEC includes staff members with expertise in areas such as subsidies analysis, intellectual property, economics, agriculture, and animal health science, and with a variety of language skills including Chinese, Russian, Portuguese and Spanish.  ITEC dramatically upgrades America’s ability to identify and address violations of trade agreements.  It represents a historic commitment of personnel and budget to enforcement efforts, giving the United States greater capacity to find, prove, prosecute, and stop violations of trade agreements.

HIGH VOLUME OF DISPUTES:  Under this Administration, USTR has filed 18 WTO complaints, more than any other WTO Member.  Nine filings target measures adopted by China; three target Indian measures; other complaints addressed an array of major economies including Argentina, the European Union, Indonesia, and the Philippines.  At the same time, through our Free Trade Agreements, USTR has broken new ground by launching a dispute settlement case involving labor rights and environmental rights and conservation. 

A CONSISTENT RECORD OF SUCCESS:  The Administration has an outstanding record of success.  Of the 18 complaints filed since 2008, the U.S. prevailed in all 6 of the disputes that have resulted in WTO decisions.  The U.S. has also settled 1 case on favorable grounds.  (The remaining complaints are pending).

IMPACT ON AMERICAN WORKERS AND BUSINESSES:  These stepped-up enforcement efforts cases are designed to benefit American workers and businesses by leveling the playing field and by setting long-term precedents that will support future American growth. For example:

  • The U.S. case targeting the European Union’s Airbus subsidies carries with it billions of dollars in direct value for American aerospace workers and companies of all sizes and will set clear legal lines restricting new civil-aircraft subsidy programs.
  • The U.S. case against Chinese limits on electronic payment services establishes key, market-opening precedents for services trade and the digital world.   
  • Through the case against Chinese export restraints on rare earths, the Administration is striving to provide major benefits to U.S. high-tech industries that make use of these important inputs, and to confirm important precedents ensuring access to essential minerals and intermediate goods.
  • The case against India’s solar-energy local content rules is aimed at forced localization policies adopted by India and other major economies.   
  • The case filed against Guatemalan labor practices under the CAFTA-DR demonstrates the enforceability of labor provisions in free trade agreements and helps to ensure that our trading partners aren’t avoiding the enforcement of their labor law in the hopes of gaining trade or investment advantage.
  • Several cases offer especially important economic impacts for small and medium-sized businesses.  These include WTO filings against Chinese export requirements for auto parts manufacturers, Indian use of unscientific supposed health requirements to block poultry imports, and unfair import licensing rules in Argentina.