U.S. Aims To Complete Technical Work On Four More TPP Chapter...

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U.S. Aims To Complete Technical Work On Four More TPP Chapters In May Round
Posted: April 2, 2013

U.S. trade officials have told business representatives that they are aiming to use the next round of Trans-Pacific Partnership (TPP) negotiations in May to complete technical work on additional chapters including those on sanitary and phytosanitary (SPS) issues, technical barriers to trade (TBT), investment and services, according to private-sector sources. Following the March TPP round in Singapore, these officials indicated they are hoping to add these four chapters to the list of TPP areas where negotiations are so far advanced that they will not be discussed again by technical experts, they said. Outstanding issues in these areas will only be considered later in the negotiation, presumably at a higher political level. At this point, the four chapters that already have their technical work concluded are regulatory coherence, customs, development and telecommunications, the Office of the U.S. Trade Representative announced at the conclusion of the Singapore round. The Peru round of TPP negotiations is scheduled from May 15-24. Other chapters for which technical work is slated to continue during the Peru round include labor, dispute settlement, rules of origin, electronic commerce, intellectual property rights, competition and environment. The only outstanding portion of the competition chapter consists of a U.S. proposal for disciplines on state-owned enterprises. The United States is hoping that TPP countries will come to the table in Peru ready to negotiate on the U.S. proposal for the first time, a USTR official said last week ( Inside U.S. Trade, March 29). In a related development, Gordana Earp, the Treasury Department's point person on customs and rules of origin issues in TPP has left her job in the government after more than 30 years of working in the U.S. government, including USTR. As of this year, she has joined Sandler Trade as a senior trade director. On SPS, sources said the key outstanding issue is how disputes will be resolved. In Singapore, the U.S. floated a non-paper that proposed setting up a consultative mechanism for dispute resolution. That mechanism would include a role for a neutral facilitator, according to one informed source. The consultative approach floated by USTR would appear to fall short of demands by U.S. agriculture and food groups that SPS obligations be subject to normal TPP dispute settlement procedures ( Inside U.S. Trade, Aug. 3). On TBT, USTR officials have said negotiators made good progress on the text of the chapter in Singapore, but that work still remains on seven proposed annexes, sources said. One of these TBT annexes was just tabled at the Singapore round, according to these sources. The U.S. had originally proposed three sector-specific TBT annexes that focused on easing regulatory barriers for medical devices, cosmetics and pharmaceutical products (Inside U.S. Trade, Nov. 4, 2011). In addition, Malaysia has tabled a TBT annex that aims to prevent a TPP country from requiring companies to hand over proprietary formulas for foods and food products as a condition of marketing them within its territory. Several civil society sources at the Singapore round said they were worried that the U.S.-backed Malaysian proposal could adversely impact countries' ability to regulate for public health purposes (Inside U.S. Trade, March 8). On investment and cross-border trade in services, the U.S. aims to complete the technical work on the text of the chapters in Peru, but one source stressed that this does not include the non-conforming measures (NCMs). Those describe the investment and services sectors that countries are seeking to exempt from liberalization in TPP. They are considered part of market access negotiations, which are conducted on a plurilateral basis in the areas of services, investment and government procurement. With respect to goods, the U.S. is currently negotiating bilaterally with the four countries with which it does not currently

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U.S. Aims To Complete Technical Work On Four More TPP Chapter...

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have a free trade agreement: New Zealand, Brunei, Vietnam and Malaysia. In all areas of market access, TPP countries sought to exchange new offers prior to the Singapore round. On goods market access, U.S. trade officials said they had a positive exchange with Vietnam at the Singapore round, according to private-sector sources. One source said USTR is planning a new exchange of goods offers with Vietnam in mid-April. According to this source, USTR has indicated that Vietnam's most recent offer on services and investment yielded only technical as opposed to substantive improvements. USTR has been working closely with Vietnam to help it draft a services offer based on the negative list approach being used in TPP, which Vietnam has never before done in a trade agreement. The U.S. is also planning to negotiate on goods market access with Canada, but those talks have not yet begun, sources said. USTR has indicated it plans to kick off those negotiations in the coming months, and one source said an exchange of offers could take place as soon as within the next few weeks. Prior to the Singapore round, Canada, which only joined the TPP negotiations last October, exchanged identical goods market access offers with all TPP countries except the U.S. In that offer, Canada placed its tariff lines for its most sensitive products -- dairy, poultry and eggs -- in an "undefined basket" that does not specify the length of the proposed tariff phaseout, sources said.

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