USITC to study effect of duty-free imports under TPP

The investigations, U.S.-Trans-Pacific Partnership Free Trade Agreement Including Canada and Mexico: Advice on the Probable Economic Effect of Providing Duty-Free Treatment for Imports, were requested by the U.S. Trade Representative (USTR) in a letter received July 19, 2012.

In the request letter, the USTR stated that Canada and Mexico have joined TPP negotiations and asked the USITC to provide advice concerning the probable economic effect of a U.S. free trade agreement with Australia, Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.

For the current report, the USTR asked that the USITC, among other things, identify any changes in its advice from the earlier advice that did not include Canada and Mexico. The USITC has previously provided advice to the USTR concerning the probable economic effect of providing duty-free treatment for imports of products from Australia, Brunei Darussalam, Chile, New Zealand, Peru, Singapore, and Vietnam, plus Malaysia, under a TPP FTA (those reports remain classified by the USTR).

As requested, the USITC will advise the President as to the probable economic effect of providing duty-free treatment for imports of products of the ten TPP members on industries in the United States producing like or directly competitive articles and on consumers.

In preparing its advice, the ITC will consider each article in chapters 1 through 97 of the Harmonized Tariff Schedule of the United States for which tariffs will remain, taking into account implementation of U.S. commitments in the World Trade Organization and under U.S. free trade agreements that the United States has with a TPP country.

The advice will be based on the 2011 Harmonized Tariff Schedule nomenclature and trade data for the year 2011. The advice will assume that any known U.S. non-tariff barrier will not be applicable to such imports, and the USITC will note in its report any instance in which the continued application of a U.S. non-tariff barrier would result in different advice with respect to the effect of the removal of the duty.

In addition, as requested by the USTR, the USITC will prepare an assessment of the probable economic effect of eliminating tariffs on imports of certain agricultural products of the TPP members on U.S. industries producing the product concerned and the economy as a whole. A list of the products is attached to the USTR's request letter, which can be obtained from the USITC's web site and its electronic document information system (EDIS).

The USITC expects to submit its report, which will be confidential, to the USTR by November 19, 2012.

The USITC is seeking input for these investigations from all interested parties and requests that the information focus on the issues for which the USITC is requested to provide information and advice.