Aggressive Oversight Required to Ensure Americans Reap Full Benefits of High-Standard Trade Agreements

Illustrative List of Commercial Implementation & Compliance Issues with Select International Trading Partners

Over the past three decades, the United States has entered into 14 trade agreements with 20 countries. While each of these trade pacts has provided significant economic benefits to American job creators, workers, farmers, innovators, and consumers, there is widespread concern that some of our international trading partners have not fully and faithfully implemented and complied with all of their trade obligations.

The result? Many American stakeholders may not be reaping the full benefits of U.S. trade agreements that aim to boost American exports, promote job growth, and strengthen the economy here at home.

In fact, each year the administration submits a series of mandated reports to Congress, like the National Trade Estimate Report on Foreign Trade Barriers among others, that outline market access barriers, implementation challenges, and compliance concerns with current international trading partners.

These reports show that high-standard trade agreements alone are not enough. The United States must stay vigilant with its oversight to ensure that its trading partners around the globe are upholding their commitments. In the end, Congress can conduct oversight, but only the executive branch can actively enforce trade commitments with our international partners and make sure that these commitments are met prior to entry into force of trade agreements.

Today, the Senate Finance Committee will take a look at lessons learned from past trade agreements and examine how the executive branch can improve implementation of future trade agreements.

Here are some examples of current implementation and compliance concerns that the United States continues to work to rectify with its current international trading partners:

Australia

Failure to provide sufficient notice and other procedural rights to patent holders when considering marketing approval for pharmaceutical products during the term of the patent.
Pursues damages against a patent holder acting in a bona fide and reasonable manner in seeking to enforce its patent to prevent infringement, if the patent holder ultimately loses its cases.

Canada

Failure to fully implement its WIPO treaty commitments.
Restrictive and discriminatory patentability criteria.
Standard for the disclosure of confidential business information.

Chile

Failure to implement an effective system for addressing patent issues expeditiously in connection with applications to market pharmaceutical products.
Failure to implement protections against the unlawful circumvention of technological protection measures and protections for encrypted program carrying satellite signals.

Colombia

Nontariff barriers (i.e., scrappage requirements) to importation of new freight trucks.
Discriminatory taxation of imported distilled spirits.
Failure to grant patents for second uses and unreasonably restrictive patentability criteria for biologics.
Failure to implement copyright obligations and inadequate enforcement of copyright violations related to physical and digital piracy.

Costa Rica

Discriminatory excise taxation of spirits.

Jordan

Inadequate intellectual property rights protection, preferential treatment of domestic pharmaceutical products.
Unnecessary obstacles to trade in the form of burdensome regulatory requirements.

Korea

Restrictions on the transfer of data by domestic financial firms to allow processing and other functions to be performed by affiliates outside of Korea.
While Korea is still implementing Annex II of KORUS, several aspects of that implementing legislation appears to limit the ability of U.S. law firms to establish joint Korean law firms and provide legal services in Korea.

Mexico

Failure to enact legislation to implement fully the World Intellectual Property Organization internet treaties.
Failure to invalidate trademark registrations containing a U.S. state name.

Peru

Failure to implement fully obligations regarding the prevention of government use of unlicensed software.
Discriminatory taxation on imported spirits.
Failure to recognize patents for second uses.
Failure to implement patent term restoration.

Source: List compiled by Senate Finance Committee Majority Staff. Examples are based on public stakeholder submissions to the U.S. federal government.

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