Order Code RS21142
Updated March 18, 2002
CRS Report for Congress
Received through the CRS Web
Status of Trade Legislation in the 107th
Congress
Vivian C. Jones
Analyst in International Trade and Finance
Foreign Affairs, Defense, and Trade Division
Summary
Congressional leaders and the Bush Administration have placed broad and often
controversial international trade issues high on the legislative agenda during the 107th
Congress. A free trade agreement with Jordan and a bilateral trade agreement with
Vietnam were both approved in 2001. Legislation was also enacted providing conditions
under which Mexican trucks will be permitted to operate in the United States
Several other major issues, including provision of trade promotion (“fast-track”)
authority for the President, renewing certain trade preferences, revising export controls,
enhancing export financing, assisting firms and workers affected by imports, and revising
trade remedy statutes are expected to receive congressional attention this year.
Trade Legislation Enacted in 2001
In the first session of the 107th Congress, congressional action has been completed
on a free trade agreement with Jordan (P.L. 107-43) and a bilateral agreement with
Vietnam (P.L. 107-152). Legislation was also enacted outlining conditions under which
Mexican firms will be permitted to provide commercial trucking services across the United
States border.
Jordan FTA. The free trade agreement (FTA) with Jordan provides that over a ten-
year period the duties on almost all goods will be phased out, leading to duty-free trade
between the United States and Jordan. Certain controversial provisions in the agreement
involved non-tariff issues, including language on labor rights and environmental protection
that appear as an integral part of the FTA, rather than as side agreements. The FTA was
signed on October 9, 2000, and the Clinton Administration submitted the agreement to the
Congress on January 6, 2001. Implementing legislation in the House (H.R. 2603) was
approved by voice vote on July 31, 2001, and in the Senate (H.R. 2603) by voice vote on
September 24, 2001. The implementing bill was signed by the President on September 24
(P.L. 107-43) and entered into force December 17, 2001.
Congressional Research Service ˜ The Library of Congress

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Vietnam BTA. The bilateral trade agreement (BTA) signed by the United States and
Vietnam on July 13, 2000 extends provisional normal trade relations status (NTR) to
Vietnam, a move that will reduce average tariffs on Vietnamese goods from 40% to less
than 3%. In return, the Vietnamese government has agreed to undertake a wide range of
market-opening measures that will make it easier for U.S. companies to export and invest
in Vietnam. On September 6, 2001, the House approved the agreement (H.J.Res. 51) by
voice vote, and the Senate approved it on October 3, 2001 by a vote of 88-12 (roll call no.
291). The implementing bill was signed by the President on October 16, 2001 (P.L. 107-
52) and entered into force on December 10, 2001.
Mexican Cross-border Trucking. In early 2001, an international arbitration
panel found that an allegedly inadequate Mexican regulatory system was an insufficient
legal basis for U.S. refusal to approve any applications from Mexican carriers for new
authority to provide cross-border trucking services, and therefore is a violation of the
North American Free Trade Agreement (NAFTA). This decision, and the Bush
Administration’s support for opening up the border to Mexican carriers by January 2002
was a cause for concern by many Members of Congress because of concerns that the
safety of U.S. highways would be compromised.
On November 28, 2001, Senator Patty Murray and others announced a House-Senate
compromise with the White House on the Mexican cross-border trucking issue. The
compromise provision was included in the conference report of H.R. 2299, the
Department of Transportation appropriations bill. President Bush had threatened a veto
of the bill if certain safety provisions the White House considered discriminatory were
included in the legislation. The conference report was approved by the House on
November 30, by the Senate on December 4, and signed by the President on December
18 (P.L. 107-87).
Trade Legislation Pending in 2002
Several other major issues, including providing Presidential trade promotion (“fast-
track”) authority, renewing certain trade preferences, revising export controls, providing
export stimulation, assisting firms and workers affected by imports, and revising trade
remedy statutes await additional congressional action this year.
Trade Promotion Authority. The biggest and most controversial issue facing the
current Congress involves renewal of presidential trade promotion (“fast-track”) authority,
a procedure that allows legislation implementing trade agreements to be treated according
to special legislative procedures (an up or down vote with no amendments allowed). This
authority expired in 1993, and has not been renewed. One of the primary issues thwarting
its renewal has been differences between Republicans and Democrats on the degree to
which non-trade issues, such as labor and environmental issues should be addressed in
trade negotiations.
On October 9, 2001, the House Ways and Means Committee reported H.R. 3005
(Thomas). The bill would authorize the President to negotiate tariff and non-tariff trade
agreements through June 30, 2005 with a two-year extension possible under certain
conditions. H.R. 3005 was passed by the House of Representatives on December 6, 2001
by a vote of 215-214. The Senate Finance Committee marked up the bill and ordered

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reported an amended version on December 18, 2001, subsequently reported by Senator
Baucus on February 28. Senator Daschle has stated his intention to bring trade promotion
authority to the Senate floor early this year, possibly in tandem with reauthorizing and
expanding programs designed to help U.S. workers hurt by trade.
Andean Trade Preference. The Andean Trade Preference Act (ATPA) extends
reduced-rate or duty-free treatment to imports from Bolivia, Colombia, Ecuador, and Peru
in an effort to diminish the illegal production of drugs in these countries by providing
improved access to the U.S. market for farmers and businesses. The Act (Title II of P.L.
102-182), signed by President George Bush on December 4, 1991, expired on December
4, 2001.
House Action. On October 5, 2001, the House Ways and Means Committee
reported H.R. 3009, the Andean Trade Promotion and Drug Eradication Act, an amended
extension of the ATPA seeking to extend the program through December 31, 2006, and
to expand benefits provided for Andean exports. Apparel items assembled in beneficiary
countries from U.S.-made fabrics using U.S.-made yarn would get unlimited duty-free
access, as would processed tuna. Apparel items assembled from regional fabrics using
U.S.-made yarn would get quantity-limited duty-free access. Other product groups
previously excluded from duty-free treatment, including footwear, petroleum, watches and
watch parts, handbags, and other leather goods, would be eligible for duty-free treatment
provided the President determines that they are not “import sensitive.” The Act would
also expand the conditions countries need to meet to qualify for these benefits. The
measure was subsequently passed by the full House on November 16.
Senate Action. An ATPA extension through June 4, 2002 was included in the
Senate Finance Committee version of H.R. 3090, the Economic Security and Recovery
Act, reported to the Senate on November 9. The committee substitute was withdrawn,
however, during Senate floor debate on November 14. The House version of H.R. 3090,
which did not contain an ATPA provision, passed on October 24.
On November 29, the Senate Finance committee approved an amendment in the
nature of a substitute to H.R. 3009 (the House-passed ATPA bill) containing the
substance of S. 525 (a measure originally introduced by Senator Graham on March 13,
2001) with amendments. It also seeks to expand the preference, but the Senate treatment
of textiles and apparel is more restrictive. Senate floor action is pending.
Generalized System of Preferences. The Generalized System of Preferences
(GSP) is a preference through which the United States provides preferential tariff
treatment on about 6,200 imported items from about 140 lesser-developed countries. The
provision expired at the end of September 2001. Renewal is currently pending.
House Actions. On October 16, 2001, the House Ways and Means Committee
favorably reported H.R. 3010, a bill seeking to renew the GSP through December 31,
2002 (and retroactively to September 30, 2001). House floor action is pending.
Senate Actions. A provision extend the GSP through December 30, 2002 was
also included in the Senate version of H.R. 3090 reported by the Senate Finance
Committee on November 9, however, on November 14, the Senate Finance amendment
was withdrawn by unanimous consent. Another measure related to the GSP, S. 1671

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(Baucus), a bill seeking to provide duty-free treatment under the GSP for certain hand-
knotted or hand-woven carpets and leather gloves, was introduced on November 9.
Permanent Normal Trade Relations. The United States currently extends
normal trade relations (NTR) status to several Eastern European countries on a temporary,
periodically renewable basis in accordance with the provisions of Section 402 of the Trade
Act of 1974, commonly known as the Jackson-Vanik amendment. President Putin of
Russia has requested that Russia be provided with permanent NTR status. President Bush
has indicated his support for this action. On December 20, 2001, H.R. 3553 (Thomas) and
S. 1861 (Lugar) were introduced, seeking to provide permanent NTR status to Russia.
In addition, bills have been introduced (but not yet acted upon) to extend permanent NTR
status to Cuba (H.R. 796; S. 401), to Kazakhstan (H.R. 1318; S. 168), to Afghanistan
(H.R. 3440) and, most recently, to Russia (H.R. 3553; S. 1861), to withdraw it from China
(H.R. 1497), and to deny to China either permanent or temporary NTR status (H.R.
1467).
Export Administration Act. The 107th Congress has continued efforts to rewrite
the Export Administration Act of 1979 (EAA), which expired on August 20, 2001. The
EAA is the primary authority for U.S. controls on exports of so-called dual-use goods and
technologies to protect national security, and to promote foreign policy objectives. Past
efforts to reauthorize the Act have been affected by the continuing tension between
national security and commercial interests.
House Actions. On August 1, 2001, the House International Relations committee
approved an EAA bill, H.R. 2581 (Gilman, July 20, 2001). The bill was subsequently
reported, as amended, to the full House on November 16, but awaits committee action in
several other committees to which has been referred. In addition, bills seeking a three-
month extension of EAA 1979 (H.R. 2602 and H.R. 3189) were passed by the House and
placed on the Senate calendar during the 2001 session.
Senate Actions. On April 2, 2001, the Senate Committee on Banking, Finance,
and Urban Affairs reported S. 149, a bill seeking to renew and update the Export
Administration Act. The bill was passed by the Senate on September 6, 2001 following
three days of floor debate.
Export-Import Bank. Authority for the Export-Import Bank (Eximbank), the chief
Federal agency that helps finance and promote U.S. exports, expired on September 30,
2001, but continued its activities under continuing resolution through January 10, 2002.
A further temporary extension of the Bank’s charter until March 31, 2002 was authorized
in H.R. 2506 (P.L. 107-115), the Foreign Operations appropriations bill. Additional
legislative attention to reauthorize the bank for a longer period is required. On October
31, 2001, the House Committee on Financial Services marked up and approved H.R.
2871, the Export-Import Bank Reauthorization Act of 2001. The bill, and its companion
bill S. 1372 (Sarbanes) would extend the authority of the Eximbank through fiscal year
2005. H.R. 2871 was reported to the full House on November 15.
Trade Adjustment Assistance for Firms and Workers. Authority for the
Trade Adjustment Assistance (TAA) programs for firms and workers was scheduled to
expire on September 30, 2001, but was extended through continuing resolutions through

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January 10, 2002. Since both programs were fully funded in their respective
appropriations bills, reauthorization of the programs is expected by the end of the 107th
Congress.
TAA for firms, a program administered by the Economic Development
Administration of the Department of Commerce, provides technical assistance to trade-
affected companies through twelve regional trade adjustment assistance centers. In the
fiscal year 2002 Commerce, Justice, State appropriations bill, (H.R. 3061, P.L. 107-77),
$10 million was appropriated for the firm TAA program.
TAA for workers offers extended unemployment benefits and job training to workers
left unemployed when imported goods have contributed importantly to their job loss. A
similar TAA component for workers, known as NAFTA-TAAP (NAFTA Transitional
Adjustment Assistance Program), was provided for in the NAFTA implementation Act
(P.L. 103-182). The NAFTA-TAAP not only aids trade-affected workers, but also helps
those affected workers who lose jobs because their firms have relocated to Canada or
Mexico. In the Department of Labor, Health and Human Services, and Education
appropriations bill (H.R. 2500, P.L. 107-77) for fiscal year 2002, $416 million was
appropriated for the TAA and NAFTA-TAAP programs for workers.
House Actions. On October 16, 2001, the House Ways and Means Committee
reported H.R. 3008, which would extend TAA programs for firms and workers until
September 30, 2003. This bill was passed by the House on December 6.
Senate Actions. Reauthorization of TAA for firms and workers through calendar
year 2002 was included in the Senate Finance Committee amendment of H.R. 3090, the
economic stimulus bill, however, the amendment was withdrawn during floor action on
November 14. On December 4, 2001, the Senate Finance Committee marked up and
ordered reported an amended version of S. 1209 (Bingaman), a bill seeking to consolidate
and improve the trade adjustment assistance program and to provide community-based
economic development assistance for trade-affected communities. The bill was
subsequently reported, as amended, by Senator Baucus on February 4, 2002.
Steel Industry Issues. Steel imports, especially from East Asia, Russia, Brazil,
and Eastern Europe, have been a cause of concern for many domestic producers since the
late 1990s. President Bush’s decision on import relief for the steel industry is expected to
be announced on March 9, 2002. Many Members of Congress are concerned about the
domestic steel industry’s ability to remain competitive, and if the Administration’s
measures are not deemed satisfactory, legislative measures may be proposed.
Background. On June 5, 2001, President Bush launched a multi-pronged initiative
to “respond to challenges faced by the U.S. steel industry.” One part of the initiative
included directing U.S. Trade Representative (USTR) Zoellick to request an International
Trade Commission (ITC) investigation of injury as provided for in Section 201 of the
Trade Act of 1974. The USTR forwarded the Administration request to the ITC on June
22, 2001.
On October 22, the ITC made affirmative injury determinations on 12 out of 13 steel
product categories, finding that the products are being imported in such quantities that
they are a “substantial cause of serious injury or threat of serious injury to a U.S.
industry.” On December 7, 2001, the ITC announced its recommendations concerning the

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remedies the Commission believed would aid the industry, including imposition of
additional tariffs on certain steel products. These recommendations were formally
presented to the President on December 19. In a letter dated January 3, 2002, USTR
Zoellick requested additional information from the ITC on the steel determination. The
ITC responded to the request beginning on January 9. On March 5, 2002, President
Bush issued a proclamation imposing tariffs of up to 30 percent over the next three years
on major categories of steel imports.
Table 1. Status of Major Trade Legislation in the 107th Congress
Issue
House Action
Senate Action
Executive Action
Trade Promotion Authority
H.R. 3005(Thomas) Passed
Senate Finance amendment
(TPA)
Dec. 6
of H.R. 3005 reported Feb.
28.
Jordan FTA
H.R. 2603(Thomas) Passed
H.R. 2603 passed Sept. 24
Signed by President Sept.
July 31
28 (P.L. 107-43).
Vietnam BTA
H.J. Res. 51 (Armey) passed
H.J. Res. 51 passed Oct. 3
Signed by President Oct. 16
Sept. 6
(P.L. 107-152)
Andean Trade Preference
H.R. 3009 (Crane) passed
H.R. 3090 as reported by
(ATPA)
Nov. 16
Senate Finance contains
ATPA provision. Reported
Nov. 9, withdrawn Nov. 14.
H.R. 3009 (amended)
approved by Senate Finance
Nov. 29, reported Dec. 14.
Generalized System of
H.R. 3010 (Crane) approved
H.R. 3090 as reported by
Preferences (GSP)
by Ways and Means
Senate Finance contains
Committee Oct. 9, reported
GSP provision. Reported
Oct. 16.
Nov. 9, withdrawn Nov. 14.
Export Administration
H.R. 2581(Gilman) Intl.
S. 149(Enzi) passed Sept. 6.
(EAA)
Relations Cte. approved
(amended) Aug. 1, reported
Nov. 16. Armed Svcs. Cte.
Reported March 8.
H.R. 2602 and H.R. 3189
proposing temp. extension
of EAA passed House July
30 and Nov. 27.
Export-Import (Exim) Bank
Reauthorized to March 31,
Reauthorized to March 31,
H.R. 2506 signed by
2002 in H.R. 2506, Foreign
2002 in H.R. 2506, Foreign
President Jan. 10 (P.L. 107-
Operations appropriations
Ops appropriations bill.
115).
bill. Passed July 24.
Passed Oct. 24.
H.R. 2871: Reported by
S.1372: Reported by
Financial Services Cte. Nov.
Banking, Housing and
15 (H.Rpt 107-292).
Urban Affairs Cte. Aug. 3.
Trade Adjustment
H.R. 3008 (Johnson) passed
H.R. 3090 as reported by
Assistance (TAA) for firms
Dec. 6
Senate Finance contains
and workers
TAA provisions. Reported
Nov. 9., withddrawn Nov.
14.
S. 1209 (Bingaman)
reported (amended) Feb. 4.

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