The U.S. is now facing formal complaints from both Mexico and Canada over how it's calculating regional value content in the auto rules of origin under USMCA. Canada formally joined Mexico's call for consultations, it announced Aug. 26. Canada says that, like Mexico, it does not agree "with the interpretation of the United States of the relationship between the core parts and vehicle regional value content calculations."
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U.S. Trade Representative Katherine Tai, in a readout of an Aug. 25 call with Turkey's Trade Minister Mehmet Mus, said that she argued that the Organization for Economic Cooperation and Development's discussions on international taxation are the best way to resolve the issues that led countries to want to impose digital services taxes. The USTR has said that 32 subheadings of Turkish imports could face tariffs if Turkey imposes a DST. The value of goods on the list imported in 2019 was $310 million.
Sen. Chuck Grassley, R-Iowa, told reporters on a press call that his constituents are saying they're concerned there is a "lack of a trade agenda in this administration." He said that in the months since Katherine Tai was confirmed as U.S. trade representative, "I haven't seen any movement on trade agreements."
A readout of U.S. Trade Representative Katherine Tai's video call with the U.S.-China Business Council and the U.S. Chamber of Commerce's China Center Advisory Board said that she told them that the trade relationship with China is important, and there needs to be "a thorough strategic assessment to craft resilient trade policy that supports the Administration’s efforts to create jobs, raise wages, and strengthen our communities." She "reiterated USTR’s commitment to addressing China’s unfair trade policies and non-market practices that undermine American businesses and workers." The readout made no mention of tariffs, but said the business groups talked about the "challenges and opportunities" in the China market.
After Mexico asked it for consultations (see 2108230041), arguing that the NAFTA approach to roll-up should be continued under USCMA, the Office of the U.S. Trade Representative said the request is under review. USTR spokesman Adam Hodge said that U.S. government officials "remain committed to fully implementing the USMCA, including the strong auto regional content requirements to which we all agreed.”
A former assistant U.S. trade representative for services and investment is joining Rock Creek Global Advisors as a managing director. A founder of the firm noted that Daniel Bahar led in digital trade policy and negotiations and represented USTR on the Committee on Foreign Investment in the United States (CFIUS). "His experience in negotiating investment rules with China, developing cutting-edge digital trade policy, and dealing with the intersection of national security and global commerce will be of great benefit to our clients," Daniel Price said.
The Mexican government has asked the Office of the U.S. Trade Representative for formal consultations under USMCA's dispute resolution process over a disagreement on how the auto rules of origin should work. Mexico says that when it agreed to a 75% regional value content standard at the end of the phase-in period, its negotiators were assuming that once a part is considered originating, its value should count as North American as you move to assemblies, and ultimately, to the vehicle as a whole. So, Mexico says that in the text on the rules of origin, if a core part is originating, its full value is counted in a super-core part, such as an engine, and if that engine is originating, its value counts in the RVC for the vehicle as a whole.
Seven Republican senators, led by Sen. Jim Inhofe, R-Okla., are asking U.S. Trade Representative Katherine Tai to restart negotiations with Kenya begun in the last administration, with a goal of signing a free trade agreement. They sent a letter Aug. 20 that argued that a free trade agreement "would build on the African Growth and Opportunity Act (AGOA) of 2000, which expires in 2025. ... A U.S.-Kenya FTA would strengthen trade and commercial ties at a time when China and Russia are seeking economic influence across the African continent. The U.S. would ultimately be able to further promote human rights, the rule of law, economic development and positive relations with Kenya and Africa through a FTA."
The Office of the U.S. Trade Representative is asking for submissions on Russia's compliance with World Trade Organization rules to assist in the preparation of its annual report to Congress on the subject. Written comments are due by 11:59 p.m. EDT Sept. 22.