Order Code 97-896
Updated March 28, 2001
CRS Report for Congress
Received through the CRS Web
Why Certain Trade Agreements Are Approved
as Congressional-Executive Agreements
Rather Than as Treaties
Jeanne J. Grimmett
Legislative Attorney
American Law Division
Summary
Certain trade agreements (e.g., the NAFTA and the GATT Uruguay Round
agreements) have been approved by majority vote of each House of Congress rather
than by two-thirds vote of the Senate — that is, they have been treated as congressional-
executive agreements rather than as treaties. The congressional-executive agreement has
been the vehicle for implementing Congress' long-standing policy of seeking trade
benefits for the United States through reciprocal trade negotiations. In a succession of
statutes, Congress has authorized the President to negotiate and enter into tariff and
nontariff barrier (NTB) agreements for limited periods, while mandating that NTB and
free trade area agreements negotiated under this authority could enter into force for the
United States only if approved by both Houses in a bill enacted into public law and other
statutory conditions were met. The same approach was proposed in 104th and 105th
Congress legislation intended to authorize the negotiation and entry into new trade
agreements. Such legislation was discussed in the 106th Congress, but no bills with broad
fast-track trade agreement authorities were introduced. The President is seeking such
authority from the 107th Congress, with various legislative approaches being proposed
and discussed. On February 27, 2001, the U.S. Court of Appeals for the Eleventh
Circuit dismissed an appeal challenging the constitutionality of the NAFTA because it
was not entered into as a treaty, the court ruling that the issue was a nonjusticiable
political question (Made in the USA Foundation v. United States, No. 99-13138, 2001
WL 194857).
Statutory Authority for Trade Agreements. The trade agreements that
emerged from the GATT Uruguay Round of Multilateral Trade Negotiations were
negotiated by the President and submitted to Congress under the terms of the Omnibus
Trade and Competitiveness Act of 1988 (OTCA) and the Trade Act of 1974. The OTCA
provided the President with authority to negotiate and enter into GATT tariff and nontariff
trade barrier (NTB) agreements until June 1, 1993, authority that was subsequently
Congressional Research Service ˜ The Library of Congress

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extended to April 15, 1994, in order to complete the Uruguay Round.1 It also provided
that NTB agreements negotiated under OTCA authority could not enter into force for the
United States unless, among other things, the agreements were submitted to Congress
along with an implementing bill and the implementing bill was enacted into law.2 Such
legislation was entitled to so-called fast track or expedited consideration by Congress.
These expedited procedures are set forth in § 151 of the Trade Act of 1974, 19 U.S.C. §
2191. The term "implementing bill" is defined in § 151(a) of the Trade Act as one that
contains the following: (a) a provision approving the agreements; (b) a provision
approving the statement of administrative action that the President must send to Congress
along with the agreements; and (c) if changes to existing laws are needed, provisions
"necessary or appropriate to implement such trade agreement or agreements, either
repealing or amending existing laws or providing new statutory authority."3 It is the
provision approving the agreements that makes the Uruguay Round agreements, and
previously the NAFTA and other free trade agreements and GATT-related agreements,
congressional-executive agreements rather than treaties.
Development of the Statutory Trade Agreements Program. The trade
agreement authorities and requirements embodied in the OTCA reflect a congressional
approach to international trade policy that evolved over a number of years.4 As early as
1890, Congress delegated tariff bargaining authority to the President and authorized him
to suspend existing duty-free treatment on particular items by proclamation. The Supreme
Court subsequently held that the authorizing statute, § 3 of the Tariff Act of 1890, 26 Stat.
1 Omnibus Trade and Competitiveness Act of 1988 (OTCA), P.L. 100-418, § 1102, 19 U.S.C. §
2902, as amended by the Act of July 2, 1993, P.L. 103-49, § 1.
2 OTCA, § 1103, 19 U.S.C. § 2903.
3 The negotiation, entry into, and implementation of trade agreements implicates the President's
Article II authority to negotiate treaties and international agreements and to conduct foreign affairs
(see United States v. Curtiss-Wright Export Corp., 299 U.S. 319 (1936)) and Congress' express
power to impose duties and tariffs and to regulate foreign commerce (U.S. Const., Art. I, § 8, cls.
1, 3). Because of Congress' express power in the area, the President may not impose, reduce, or
effect any other change in existing duty rates through an executive agreement unless he has been
delegated the authority to do so by Congress. See United States v. Yoshida Int'l Inc., 526 F.2d 560,
572 (C.C.P.A. 1975)("no undelegated power to regulate commerce, or to set tariffs, inheres in the
Presidency")(emphasis in the original); United States v. Guy W. Capps, Inc., 204 F.2d 655, 660
(4th Cir. 1953)("Imports from a foreign country are foreign commerce subject to regulation, so far
as this country is concerned, by Congress alone."). Regarding the President's authority to enter into
agreements involving foreign commerce, see Consumers Union of U.S., Inc. v. Kissinger, 506 F.2d
136 (D.C.Cir. 1974), cert. denied, 421 U.S. 1004(1975)(mandatory or enforceable, but not
voluntary agreements limiting exports to the United States are superseded by trade laws).
4 See generally Koh, "Congressional Controls on Presidential Trade Policymaking After I.N.S. v.
Chadha," 18 N.Y.U. J. Int'l L. & Politics 1191 (1986). The use of the congressional-executive
agreement in the trade area has been viewed as having developed in recognition of the House's
constitutional role in revenue raising. American Law Institute, Restatement (Third) of the Foreign
Relations Law of the United States § 303, Reporters' Note 9 (1987). Senate deference to the use
of the congressional-executive agreement for the Uruguay Round agreements may arguably be
inferred from its 76-16 vote to amend the OTCA to extend the date by which the President could
enter into Uruguay Round agreements pursuant to that statute, the yeas constituting more than two-
thirds of that body. 139 Cong. Rec. 14805 (1993).

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612, did not unconstitutionally delegate either legislative or treaty-making authority to the
President.5 In the Reciprocal Trade Agreements Act of 1934, as amended and extended,
Congress authorized the President, for limited periods, to enter into reciprocal tariff
agreements with foreign countries and, within a designated range, to proclaim tariffs
needed to implement these agreements without subsequent congressional approval. This
authority was used to enter into numerous reciprocal trade agreements, to proclaim new
tariffs as a result, and to enter into the General Agreement on Tariffs and Trade (under
which parties agreed, among other things, to grant each other unconditional MFN
treatment with respect to tariffs and other measures, not to raise negotiated tariff rates,
and to accord national treatment to other parties’ goods as to internal taxes and
regulations). The President's modification of tariffs under this statute was likewise held
to be valid under the Treaty Clause, federal courts having acknowledged that not all
international undertakings of the United States are concluded as treaties and that
congressional-executive trade agreements could find a constitutional basis in the joint
exercise of Congress' tariff and commerce authorities and the President's foreign affairs
power.6
As GATT parties began to negotiate more extensively to eliminate nontariff trade
barriers in a number of areas, Congress enacted legislation that would both provide the
President with negotiating credibility and ensure that Congress carried out its
constitutional responsibilities regarding legislative implementation of the agreements.
Since NTB agreements could address a variety of regulatory matters (e.g., subsidies,
antidumping and countervailing duties, government procurement, product standards),
these agreements might require more elaborate changes in federal law than tariff
agreements, which for the most part could be implemented through a pre-authorized
presidential proclamation reducing tariffs on particular items. In contrast, if legislation
were needed to implement NTB agreements, Congress could choose not to vote on such
legislation or could add amendments that might be viewed as inconsistent with agreement
obligations. At the same time, overly broad delegations of authority to the President to
implement NTB agreements or legislative vetoes of executive implementing actions might
not comport with constitutional requirements regarding the passage of legislation. In the
Trade Act of 1974, Congress provided the President with new authority to negotiate
multilateral trade agreements for a limited period of time, allowing him to proclaim certain
tariff reductions and modifications but requiring him to submit NTB agreements to
Congress, which would vote on their approval and on legislation necessary or appropriate
5 Field v. Clark, 143 U.S. 649 (1892). The U.S. Court of International Trade has held that the
tariff proclamation authority contained in § 111(b) of the Uruguay Round Agreements Act, 19
U.S.C. § 3521(b), under which the President could modify tariffs in order to implement certain
trade agreements whose negotiation had begun but had not concluded during the Uruguay Round,
was not an unconstitutional delegation of legislative authority. Kemet Electronics Corp. v.
Barshefsky, 969 F.Supp. 82 (Ct. Int'l Trade 1997). The President implemented the WTO
Agreement on Information Technology under this statute. Pres. Proc. 7011 of June, 30, 1997, 62
Fed. Reg. 35909 (1997).
6 Star-Kist Foods, Inc. v. United States, 169 F.Supp. 268 (Cust. Ct. 1958), aff'd 275 F.2d 472
(C.C.P.A. 1959). See generally Congressional Research Service, Treaties and Other
International Agreements: The Role of the United States Senate; A Study Prepared for the Senate
Comm. on Foreign Relations 51-59 (1993)(S. Prt. 103-53).

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to implement them.7 Because of the complexities of multilateral negotiation, Congress
sought to provide the President with a sound negotiating posture by providing that it
would consider trade agreement implementing legislation submitted under the terms of the
statute (including requirements that the President notify and consult with Congress) within
a prescribed period of time and without amendment.8
The fast-track procedure contained in the 1974 Act was first used with respect to the
GATT Tokyo Round Agreements, which were approved and implemented in the Trade
Agreements Act of 1979 (P.L. 96-39). Temporary statutory authority for bilateral free-
trade area agreements was added in the Trade and Tariff Act of 1984 (P.L. 98-473, § 401)
and was again provided for in the OTCA (P.L. 100-418, § 1102(c)). Congress has since
approved bilateral free trade area agreements with Israel (P.L. 99-47) and Canada (P.L.
100-449) and the trilateral North American Free Trade Agreement with Canada and
Mexico (P.L. 103-182). In 1994, the GATT Uruguay Round agreements were approved
in the Uruguay Round Agreements Act (P.L. 103-465) pursuant to OTCA provisions.
Legislation that would have renewed the President's trade negotiation authority with
a requirement that resulting agreements be approved by both Houses of Congress was
considered in both the 104th and 105th Congresses but was not enacted into public law.9
While the introduction of fast-track trade agreement legislation was discussed in the 106th
Congress, no bills containing broad authorities in the area were introduced. The Bush
7 Modifying an Administration proposal, the House in 1973 approved legislation that would have
authorized the President to negotiate tariff and nontariff barrier (NTB) agreements for a given
period. Once the agreements were concluded, the President would submit them to Congress along
with any needed draft implementing orders and proclamations. The agreements and orders and
proclamations would become law (thus superseding inconsistent prior statutes) provided neither
House had passed a resolution of disapproval by majority of those present and voting within 90
days. See H.Rept. 93-571, at 6, 23-34, 41-42. The Senate, whose Finance Committee viewed the
veto approach to be of doubtful constitutionality, prevailed in the adoption of the current
requirement for two-House legislative approval of NTB agreements and enactment of implementing
legislation on a fast-track basis. See S.Rept. 93-1298, at 14-15, 22, 76, 107. Objections to the
one-House veto procedure had also been raised earlier in dissenting views in the House report.
H.Rept. 93-571, at 199. The Supreme Court eventually held legislative vetoes unconstitutional in
Immigration and Naturalization Service v. Chadha, 462 U.S. 919 (1983).
8 S.Rept. 93-1298, at 77, 107. Legislative history indicates that these agreements could be
submitted to the Senate as treaties. H.Rept. 93-571, at 24; S.Rept. 93-1298, at 86. In such case,
however, neither the agreements nor their implementing legislation would be entitled to expedited
legislative consideration. The United States has undertaken trade obligations in treaties, namely
its bilateral friendship, commerce and navigation (FCN) treaties, which contain obligations to
accord most-favored-nation tariff treatment and other trade benefits to the goods of treaty partners.
With the conclusion of many bilateral tariff agreements pursuant to the reciprocal trade agreements
legislation, the subsequent development of the GATT, and the negotiation of numerous GATT-
related agreements, however, FCN treaties have become less important in defining trade obligations
between the United States and its trading partners.
9 H.R. 2371, 104th Cong., was reported by the House Ways and Means Committee (H.Rept. 104-
285). For a discussion of 105th Congress bills (H.R. 2621, S. 1269, S. 1200), see CRS Report 97-
957 A, Fast-Track Trade Negotiating Authority: A Comparison of 105th Congress Legislative
Proposals.

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Administration is seeking fast-track trade agreement authority from the 107th Congress,
with various approaches currently being proposed and discussed.
Constitutionality of the Congressional-Executive Trade Agreement:
Recent Issues. The question whether trade agreements could constitutionally be
entered into as congressional-executive agreements rather than treaties emerged during
consideration of Uruguay Round implementing legislation. The question originally was
posed because of the perceived effect of the agreements on states.10 The issue has also
arisen in a judicial challenge to the NAFTA, in which it has been alleged that the failure
to use the treaty process rendered the Agreement and its implementing legislation
unconstitutional. In Made in the USA Foundation v. United States, an Alabama federal
district court held in July 1999 that “the President had the authority to negotiate and
conclude NAFTA pursuant to his executive authority and pursuant to the authority granted
to him by Congress in accordance with the terms of the Omnibus Trade and
Competitiveness Act of 1988 ... and section 151 of the Trade Act of 1974 ... and as further
approved by the [NAFTA] Implementation Act.”11 In the court’s view, the Foreign
Commerce Clause, combined with the Necessary and Proper Clause and the President’s
Article II foreign relations power, provided a constitutionally sufficient basis for
agreement. The court preliminarily held that institutional, but not individual plaintiffs, had
standing to sue, and that the political question doctrine did not bar it from ruling on the
merits. The decision was appealed and, on February 27, 2001, the U.S. Court of Appeals
for the Eleventh Circuit, while agreeing with the district court that appellants had standing,
held that the issue of whether an international commercial agreement such as the NAFTA
is a treaty that must be approved by two-thirds of the Senate was a nonjusticiable political
question.12 The court dismissed the appeal and remanded the case to the district court
with instructions to vacate its decision.
10 See "Special Report," Inside U.S. Trade, July 22, 1994. Legal arguments and discussion may
be found in "Memorandum to Ambassador Michael Kantor, U.S. Trade Representative, from
Walter Dellinger, Assistant Attorney General, Office of Legal Counsel, re: Treaty Ratification of
the GATT Uruguay Round: Additional Memorandum" (November 22, 1994) [http://www.
usdoj.gov/olc/1994opinions.htm]. See also S. 2467, GATT Implementing Legislation: Hearings
before the Senate Comm. on Commerce, Science, and Transportation, 103d Cong., 2d Sess. 285-
381 (1994).
11 Made in the USA Foundation et al. v. United States, 56 F.Supp.2d 1226 (W.D.Ala. 1999).
Another constitutional challenge to an international agreement recently took place with regard to
the 1995 extradition agreement between the United States and the International Criminal Tribunal
for Rwanda, which had been entered into as an executive agreement and implemented pursuant to
§ 1342 of P.L. 104-106. Petitioner argued that a treaty was constitutionally required for an
extradition. The U.S. Court of Appeals for the Fifth Circuit disagreed, finding in an August 1999
opinion that neither the text of the Constitution, constitutional history, nor historical practice
supported such a requirement. Ntakirutimana v. Reno, 184 F.3d 419 (5th Cir. 1999). Addressing
the Supreme Court’s ruling in Valentine v. United States, 299 U.S. 5 (1936), that executive power
to extradite must be based in a statute or a treaty, the court found that the required authorization
could be found in the above-cited law, which, along with the Agreement, created the
constitutionally sufficient “congressional-executive agreement” used in this case.
12 Made in America Foundation v. United States, No. 99-13138, 2001 WL 194857 (11th Cir. Feb.
27, 2001); decision posted at [http://www.findlaw.com/casecode/courts/11th.html]. Appellants
have since announced that they will appeal the ruling to the U.S. Supreme Court.

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Under the political question doctrine, a court will decline to rule on the merits of a
case if it finds that the underlying matter is committed to the discretion and expertise of
the Legislative and Executive Branches. In the instant case, the Eleventh Circuit applied
a tripartite inquiry that it said was suggested by Justice Lewis Powell in Goldwater v.
Carter, 444 U.S. 996 (1979), a distillation of criteria for determining justiciability
originally identified in Baker v. Carr, 369 U.S. 186 (1962). The three questions posed by
the court were as follows: “(i) Does the issue involve resolution of questions committed
by the text of the Constitution to a coordinate branch of government? (ii) Would
resolution of the question demand that a court move beyond judicial expertise? (iii) Do
prudential considerations counsel against judicial intervention?”
Regarding the first question, the court stated that “with respect to commercial
agreements, we find that the Constitution’s clear assignment of authority to the political
branches of the Government over our nation’s foreign affairs counsels against an intrusive
role for this court in overseeing the actions of the President and Congress in this matter.”
Along with the “vast” express constitutional grants of power conferred upon the political
branches in the areas of foreign affairs and commerce, the court, citing United States v.
Curtiss-Wright Export Corp., 299 U.S. 304 (1936), pointed to the Supreme Court’s long-
standing recognition of the power of the political branches to conclude international
“agreements that do not constitute treaties in the constitutional sense.” With respect to
the second question, the court concluded that a ruling on the merits would in fact require
it to consider areas beyond its expertise, noting that the Treaty Clause did not set forth
circumstances under which Clause procedures must be followed when approving
international commercial agreements; that the appellants did not provide the court with a
useful analytical framework for distinguishing between agreements that require Senate
approval and those that do not; that foreign affairs considerations militated against judicial
interference; and that having to determine the “significance” of an international agreement
as the key factor in determining whether it should be a treaty or not would “unavoidably
thrust [the court] into making policy judgments of the sort unsuited for the judicial
branch.” As for prudential considerations, the court cited three factors that underlay its
decision not to rule on the merits: (1) the need for the nation to speak with uniformity in
the area of foreign affairs and commerce, and, quoting Baker, not risk “the potentiality of
embarrassment from multifarious pronouncements by various departments on one
question”; (2) the fact that a judicial order declaring the NAFTA invalid “could have a
profoundly negative effect on this nation’s economy and its ability to deal with other
foreign powers,” noting that such an order “would not only affect the validity of NAFTA,
but would potentially undermine every other major international commercial agreement
made over the past half-century”; and (3) the risk of “intruding upon the respect due
coordinate branches of government” that would be run by a judicial review of the
executive-legislative process for entry into international agreements.
Additionally, the court found support for its conclusion in Dole v. Carter, 569 F.2d
1109 (10th Cir. 1977), where the U.S. Court of Appeals for Tenth Circuit used political
question grounds to decline to rule on whether an agreement by the President to return the
Crown of Saint Stephen and other related items to Hungary constituted a treaty requiring
Senate approval.

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