The Office of the U.S. Trade Representative is asking Canada to "abandon any plans" for a digital services tax while countries continue to negotiate international taxation principles, including how to tax companies that derive revenues from a country's population but do not have a physical nexus there.

In January, some technical fixes had to be made to the Harmonized Tariff Schedule "to conform to amendments adopted by the World Customs Organization" (see 211227003). To now fix a technical error that occurred with that and to ensure that those "amendments do not extend the scope of the additional duties in the Section 301 investigation," the Office of the U.S. Trade Representative issued a notice about two technical modifications to the HTS notes that implement the additional duties. The modifications are effective as of Jan. 27.

Meetings between Deputy U.S. Trade Representative Jayme White and Ecuador's trade minister, Julio Jose Prado, focused on the U.S. desire for Ecuador to improve its agricultural import licensing system, and Ecuador's concern that the Generalized System of Preferences benefits program has lapsed. A joint statement from the two countries released Feb. 18 said they recognized Ecuador is improving efforts to battle illegal fishing, preserve forests and wildlife, fight climate change and marine debris, and end child labor. It said the U.S. discussed next steps to renew the GSP.

The Office of the U.S. Trade Representative laid out the externalities to other economies of China's state-led economy in a 72-page annual report to Congress. "Since last year’s report, our assessment of China’s record in terms of transitioning to a market economy has not changed," the report said. While the report's framing is about how China complies with World Trade Organization rules, the authors minimized the WTO's ability to constrain China and emphasized that countries must expand domestic trade remedies or develop other tools to deal with China's rise.

The Office of the U.S. Trade Representative is inviting submissions on how USMCA is working in the automotive goods arena, "including the implementation and enforcement of the USMCA rules of origin for automotive goods" and whether the accord's automotive provisions "are relevant in light of technological and production advances." Comments can be submitted through March 28 in docket number USTR-2022-0001.

Importers and exporters will again be able to ship bivalve molluscan shellfish to and from the EU beginning in late February, following the conclusion of negotiations Feb. 4 to allow for resumption of bilateral trade, the Office of the U.S. Trade Representative said in a press release late that day. “For the first time since 2011, U.S. producers, beginning in the states of Massachusetts and Washington, are eligible to export live, raw and processed bivalve molluscan shellfish to the EU, including oysters, clams, mussels, and whole or roe-on scallops,” USTR said. “EU producers in Spain and the Netherlands are also now to export live and raw bivalve molluscan shellfish to the United States.”

The deputy U.S. trade representative whose portfolio covers Asia and Africa acknowledged that it may be more challenging to get buy-in from countries for the Indo-Pacific Economic Framework without the carrot of lower U.S. tariffs, but she said corporate support will help negotiators get agreement.

A readout of U.S. Trade Representative Katherine Tai's meeting with South Korea's Trade Minister Yeo Han-koo said Tai noted "strong concerns" among U.S. steel producers, and said the U.S. is not ready to expand "conversations to develop a global arrangement that addresses the carbon intensity of steel and aluminum trade." She said she emphasized the challenges of global overcapacity driven by non-market practices. Tai said she updated Yeo on the Indo-Pacific Economic Framework, and discussed the need to cooperate in addressing global supply chain issues. They agreed to work together to promote resilient supply chains.

The Biden administration's interagency task force to monitor and combat human trafficking had its first meeting this week, and U.S. Trade Representative Katherine Tai said they will launch "a thorough interagency review of our existing trade policies and tools used to combat forced labor, including forced child labor, to determine areas that may need strengthening and gaps that need to be filled."

U.S. Trade Representative Katherine Tai said countries need to find "pragmatic solutions to increase vaccine production," during a Jan. 21 video call with 30 other trade ministers from the European Union, China, India, South Africa, Nigeria, Jamaica, the United Kingdom and other countries. The World Trade Organization has been struggling to agree on how trade laws could be eased to increase distribution of COVID-19 vaccines and treatments to developing countries. Tai's readout of the call also said there's an opportunity to reach a conclusion to the fisheries subsidies negotiations, but she wants there to be "an ambitious agreement that improves the status quo." She also said the WTO needs to tackle agriculture issues.