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This Week In Trade

Solar CVD Case, Ex-Im Fight And U.S.-EU Initiative Headline Week's Trade Developments

Posted: March 19, 2012

Posted: March 19, 2012

The week in international trade gets off to another busy start with the release of a critical U.S. government determination on Chinese solar subsidies, the continuing congressional fight over the Export-Import Bank, and a visit to Washington by European business officials to discuss their vision of an EU-U.S. trade arrangement.

Also upcoming are further steps in Bogota towards implementing the U.S.-Colombia free trade agreement, with a senior U.S. trade official visiting the Colombian capital on Tuesday. And agriculture, meat industry and public health organizations are all holding their breath to see whether USTR appeals an adverse World Trade Organization panel ruling against the U.S. country of origin labeling (COOL) system for livestock by the Friday deadline.

On Tuesday, the Department of Commerce is expected to release its preliminary margins determination in a countervailing duty (CVD) case brought by the U.S. solar panel industry against Chinese imports. With the International Trade Commission already having found preliminarily that injury to the U.S. industry exists, Commerce's preliminary determination will likely clear the way for customs officials to begin collecting bonds on imports.

Because Commerce has also found what are known as “critical circumstances,” cash deposits equal to the value of the preliminary margins will be retroactively imposed.

A delegation from the European industry federation BusinessEurope is in town early this week, primarily to hash out with its U.S. counterpart, the U.S. Chamber of Commerce, a common vision for the future of the U.S.-EU High Level Working Group on Jobs and Growth.

European businesses and the European Commission appear to prefer an agenda for the working group that will lead to a comprehensive trade arrangement in a single undertaking, but the Chamber has so far signaled an aversion to that approach due to its fear that the effort could collapse if it is too ambitious.

The two groups will try to spur this dialogue along with a press conference on Tuesday afternoon. Today (March 19), the two groups are also hosting a discussion on a separate topic: business priorities for the WTO. A number of officials from high-profile companies like Microsoft, Cisco and FedEx will take part, and U.S. Ambassador to the WTO Michael Punke is also expected to speak.

This week Senate Democrats are also poised for a fight with House Republicans over the future of the Ex-Im Bank. The Senate is expected to approve an amendment tomorrow (March 20) to the House Republican-championed JOBS Act that would reauthorize the bank through 2015, with an increase in its financing limit.

It is still unclear how the House Republican leadership will react to this move, but Majority Leader Eric Cantor (R-VA) has thus far shown little interest in a long-term reauthorization. In the midst of opposition to the bank from conservative groups, Cantor has floated separate draft legislation that would extend Ex-Im's charter by only one year and also seek a long-term phaseout of government export credit financing .

Also Tuesday, Deputy U.S. Trade Representative Miriam Sapiro heads down to Colombia to meet with government officials through Thursday, most likely to discuss the steps they are taking to implement the U.S.-Colombia FTA. The Colombian government is poised to submit this week a package of legislation needed to implement the pact, and is pressing for its Congress to approve the bill prior to President Obama's trip to Colombia on April 14-15 to attend the Summit of the Americas.

Further details are also expected to emerge this week from the Trans-Pacific Partnership (TPP) negotiating round in Melbourne, after U.S. congressional trade committees were briefed late last week on those discussions. So far, there are indications that limited progress was made in the realm of intellectual property rights, and that talks in that area will increasingly focus on controversial topics like patent protections.

The Friday deadline to appeal the WTO's Nov. 18 ruling on COOL is also looming large. Early this month, consumer safety groups weighed in with a group of Midwestern lawmakers and organizations representing U.S. ranchers to push for an appeal by the Obama administration, which so far has given no public signal of its intentions.

An appeal is expected, but USTR is also under pressure from the meat packing industry not to do so because, they claim, the COOL system is unduly burdensome and costly.

Finally, at this Friday's meeting of the WTO's Dispute Settlement Body in Geneva, Antigua and Barbuda will announce new action against the United States in its longstanding case over a U.S. ban on Internet gambling services. It is not yet clear what the Caribbean nation's strategy will be.

Antigua brought its challenge of U.S. internet gambling laws in 2003, and the United States lost both the initial case and subsequent appeal. But the country has been stuck in a bind because the U.S.  refusal to comply leaves it with the difficult option of suspending intellectual property concessions – something that has never been tried, and the results of which are uncertain.