Order Code IB10084
Issue Brief for Congress
Received through the CRS Web
Trade Promotion Authority (Fast-Track Authority
for Trade Agreements): Background and
Developments in the 107th Congress
Updated June 24, 2002
Lenore Sek
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

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CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Early Presidential Authority to Cut Tariffs
Nontariff Barriers and Fast-Track Authority
Stalemate on Fast-Track Renewal
Developments During the 107th Congress
The President’s Legislative Agenda (May 10, 2001)
New Democrats Proposal (May 24, 2001)
H.R. 2149, the Trade Promotion Authority Act of 2001
S. 1104, Trade Promotion Act of 2001
Proposal by Senator Baucus on July 25, 2001
H.R. 3019, Comprehensive Trade Negotiating Authority Act of 2001
H.R. 3005, Bipartisan Trade Promotion Authority Act of 2001
Provisions of H.R. 3005 as Passed by the House
Senate Finance Committee Action on H.R. 3005
Senate Action on TPA
Recent Developments
LEGISLATION
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
CHRONOLOGY
CRS Products

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Trade Promotion Authority (Fast-Track Authority for Trade
Agreements): Background and Developments in the 107th Congress
SUMMARY
One of the major trade issues in the 107th
sions as the House TPA bill. A controversial
Congress is whether or not Congress approves
difference, however, is the so-called Dayton-
trade promotion authority (formerly called
Craig amendment, which would allow the
fast-track authority) for the President to nego-
removal from an implementing bill any provi-
tiate trade agreements with expedited proce-
sions to amend U.S. trade remedy laws.
dures for implementing legislation. Under
this authority, Congress agrees to consider
An important issue before the House vote
legislation to implement the trade agreements
was how labor and the environment should be
(usually nontariff trade agreements) under a
designated as negotiating objectives. Now,
procedure with mandatory deadlines, no
with a comprehensive trade bill approved by
amendment, and limited debate. The Presi-
the Senate, a leading issue is trade adjustment
dent is required to consult with congressional
assistance (TAA) for displaced workers. A
committees during negotiation and notify
key question is the level of federal subsidy for
Congress at major stages.
health premiums for workers.
The President was granted this authority
Following Senate passage, House Ways
almost continuously from 1974 to 1994, but
and Means Committee Chairman Thomas
the authority lapsed and has not been renewed.
sought a rule that, he argued, would strengthen
the position of the House in the conference.
On December 6, 2001, the House passed
In a departure from usual practice, he recom-
TPA bill H.R. 3005 by a vote of 215-214.
mended a rule (H.Res. 450) that includes the
The bill covers tariff and nontariff agreements
House-approved TPA bill, reauthorization of
entered into by June 1, 2005. For expedited
Andean preferences and the Generalized
procedures to apply to legislation to imple-
System of Preferences, TAA, and other provi-
ment a trade agreement, the agreement would
sions. The House had previously approved
have to “make progress” toward meeting the
some language in the Thomas rule (e.g., TPA)
outlined negotiating objectives and satisfy
but not other language (e.g., TAA). Almost
other specified conditions. The President
all House Democrats oppose the Thomas rule:
would have to consult with congressional
some reasons they give are the higher TAA
bodies, including the newly established Con-
benefits and support for U.S. trade remedy
gressional Oversight Group. Congress could
laws in the Senate bill.
withdraw expedited procedures if consultation
requirements were not met.
On June 19, 2002, the House Rules
Committee reported out H.Res. 450. House
On May 23, 2002, the Senate passed
floor action is expected soon. Conferees have
H.R. 3009, “the Trade Act of 2002,” which
not been appointed, but if they are, analysts
included TPA provisions in title XXI. Title
expect a conference report could be available
XXI had many, but not all, of the same provi-
before the August recess.
Congressional Research Service ˜ The Library of Congress

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MOST RECENT DEVELOPMENTS
On June 19, 2002, the House Rules Committee reported out a rule (H.Res. 450)
recommended by Ways and Means Committee Chairman Thomas for consideration of the
Senate-passed TPA bill (H.R. 3009).
On May 23, 2002, the Senate passed comprehensive trade bill H.R. 3009 by a 66-30
vote. Title XXI of H.R. 3009 includes TPA provisions similar, but not identical, to the
House-approved TPA provisions.
The House approved TPA bill H.R. 3005 along party lines by a vote of 215-214, on
December 6, 2001.
BACKGROUND AND ANALYSIS
The Constitution gives Congress the primary power over trade policy: Article 1
empowers Congress “to regulate commerce with foreign nations” and “to lay and collect
taxes, duties, imposts, and excises.” For 145 years, Congress exercised this power through
frequent enactment of tariff acts, setting in detail duty rates for individual imports. Since
Congress was elected by local interests that often benefitted from protection against imports,
there were incentives for keeping tariffs at high levels.
Early Presidential Authority to Cut Tariffs
By virtue of his constitutional power to conduct foreign affairs, the President technically
has the authority to negotiate and enter into agreements with foreign countries, including
those dealing with trade and tariff policy. The President, however, has no authority to
impose duties unless Congress delegates that authority. The Reciprocal Trade Agreements
Act of 1934 made a major change in these legislative and executive roles. Under the 1934
Act, Congress authorized the President to negotiate reciprocal reductions of tariffs, within
a limited range and time period, and to implement them by proclamation without the need
for implementing legislation. Because the President was accountable to a broader
constituency than Members of Congress, the President could negotiate reciprocal reductions
in tariffs (within the limits allowed) without the political liability faced by Members.
For the next several decades, Congress extended the President’s tariff-cutting authority
several times. Under this authority, the President negotiated reductions in tariff levels
multilaterally in five rounds under the General Agreement on Tariffs and Trade. After
agreements were reached at these rounds, the President proclaimed the lower tariffs under
the authority Congress had delegated.
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Nontariff Barriers and Fast-Track Authority
The sixth round of multilateral trade negotiations, called the Kennedy Round (1964-67),
involved negotiations on nontariff as well as tariff barriers. Congress had extended
presidential tariff-cutting authority for the Kennedy Round by the Trade Expansion Act of
1962. That authority did not include negotiation of nontariff barriers. Nonetheless, the
Administration reached agreements on two nontariff barriers: (1) the American Selling Price
(ASP), which was an artificially high import valuation based on domestic producers’ prices;
and (2) a code, or set of rules, on antidumping. Although the 1962 Act authorized (as did
the 1934 Act) the President to negotiate a reduction of “any existing duty or other import
restriction,” the general view at the time was that by entering into the antidumping
agreement, the President had overstepped his delegated power. Congress subsequently not
only did not enact legislation to implement it, but actually enacted a provision which would
nullify any provision of the antidumping agreement inconsistent with the U.S. antidumping
law.
The decision by Congress not to approve the ASP or antidumping agreements showed
that there was a dilemma regarding negotiations on nontariff barriers. Trading partners
wanted assurance that U.S. negotiators could reach a deal with likelihood of approval back
home. By then, tariff levels had been reduced through prior rounds, and nontariff barriers
were becoming increasingly important in restricting trade. Without an advance grant of
authority from Congress, U.S. negotiators were concerned they would have no credibility in
future trade talks.
In the early 1970s, in anticipation of a seventh round of multilateral negotiations that
was sure to include nontariff barriers, President Nixon submitted legislation for a new type
of negotiating authority. The proposed legislation would have granted to him proclamation
authority for nontariff barriers much like the previously granted authority for tariffs. He
proposed that he be able to reach a nontariff agreement, submit it to Congress, and unless
Congress legislatively disapproved the agreement, the President would put the changes into
effect by proclamation. There would be no need for implementing legislation. The Nixon
proposal was passed in the House.
That proposal, however, was stopped in the Senate. Senate Members and staff reached
a different, substantially new arrangement with the Administration. Under this compromise,
which was enacted in the Trade Act of 1974, Congress gave the President temporary
authority to negotiate nontariff trade agreements. Congress specified negotiating objectives.
The President was required to consult with appropriate congressional committees before and
during the negotiation and to notify Congress at least 90 days before entering into the
agreement. The President had to submit implementing legislation, along with a statement
of administrative action to be taken and reasons why the agreement serves the interests of
U.S. commerce. Once the bill was submitted, Congress was to follow an expedited
legislative procedure. This procedure included mandatory deadlines, no amendments, and
limited debate. The authority to negotiate nontariff trade agreements with an expedited
procedure for implementing legislation became commonly known as fast-track authority.
At the time the compromise was approved, there was little if any controversy about the
procedural restrictions. The 1974 Act gave Congress an enlarged role in trade negotiations
through the consultation and notification requirements.
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The negotiating authority in the 1974 Act enabled the Administration to negotiate the
Tokyo Round of multilateral trade negotiations (1974-79). After the Round was completed,
there was an important development in the role of Congress regarding the implementation
of the Round’s results. When it was time to construct the implementing legislation, Senate
staff argued that Congress should have an active part in that process. The result was that
Congress took a draft bill through a “mock” legislative process, with committee
consideration, amendments, and conference committee. The President then submitted
legislation based on the final draft bill. Although not formally outlined in any document, the
executive and legislative branches thus agreed on a process that allowed congressional
involvement in crafting legislation to ensure expedited procedures once a bill was submitted.
The 1974 Act granted fast-track authority to the President for agreements reached over
the next five years. The Trade Agreements Act of 1979 (P.L. 96-39) extended the authority
another eight years. After a brief lapse, the Omnibus Trade and Competitiveness Act of 1988
(P.L. 100-418) renewed the President’s fast-track authority for agreements reached through
May 1993 (the latter two years of that renewal depended on whether the President requested
the two-year extension and Congress did not pass a disapproval resolution). The 1988 Act
was subsequently amended (P.L. 103-49) to extend fast-track authority for Uruguay Round
agreements reached before April 16, 1994. After that, the President’s trade negotiating
authority expired and has not been renewed.
Fast-track authority had been instrumental in negotiating and implementing five major
trade agreements. Two of those five agreements were multilateral agreements reached during
the Tokyo Round and the Uruguay Round negotiations in the GATT. The other three
agreements were free trade agreements: the U.S.-Israel free trade agreement, which was
negotiated under special authority in the Trade and Tariff Act of 1984 (P.L. 98-573); the
U.S.-Canada Free Trade Agreement; and the North American Free Trade Agreement. No
agreement has been disapproved under fast-track procedures.
Stalemate on Fast-Track Renewal
During the 104th Congress (1995-1996), President Clinton proposed an extension of
fast-track authority for agreements reached before December 31, 1999, with a two-year
extension beyond that date if the President requested the extension and Congress did not pass
a disapproval resolution. The President’s intent was to use fast-track authority to extend the
North American Free Trade Agreement to Chile. Democrats supported the President’s
proposal. A Republican-supported alternative was approved by the House Ways and Means
Committee on September 21, 1995. This bill, H.R. 2371 (H.Rept. 104-285, Part 1), listed
five principal negotiating objectives, but omitted objectives related to labor and
environmental standards. H.R. 2371 would have limited fast-track implementation to
provisions that are “directly related” to the specified principal negotiating objectives, unlike
previous fast-track authorizations, which provided for fast-track consideration of provisions
that are “necessary and appropriate” in the President’s discretion to negotiate trade
agreements that include areas that are not specified in the fast-track authorization. Under the
proposal, if negotiators went beyond the mandated objectives, fast-track implementation
could be denied. The bill did not reach floor vote. Disagreement over the inclusion of labor
and environmental issues was a major reason why fast-track authority was not renewed in
the 104th Congress.
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A major push to enact fast-track legislation occurred during the 105th Congress (1997-
1998). In the first half of 1997, President Clinton did little on a fast-track bill because of
attention to the budget and other priorities. In spite of warnings from both Democrats and
Republicans, he waited until after Labor Day to submit a proposal to Congress. He
submitted his proposal on September 16, 1997. The proposal was met with criticism by both
Democrats and Republicans. Many Democrats opposed the proposal because it did not
include labor and the environment in the core objectives. Many Republicans said that they
did not want to include labor or the environment in the agreement at all.
Two weeks later, on October 1, 1997, the Senate proceeded more quickly. The Finance
Committee reported out S. 1269 (S.Rept. 105-102). The bill included labor and the
environment only as they related to trade, and limited fast-track to provisions that were
necessary for the implementation of the agreement, not “necessary or appropriate.” In early
November, the Senate approved a motion to proceed to floor consideration, but stopped there
to wait for the House to act.
On October 8, 1997, the House Committee on Ways and Means approved H.R. 2621
(H.Rept. 105-341, Part 1), which was similar to the bill in the Senate. The committee vote
was 24-14, with only 4 of the 16 Democrats on the Committee voting for the bill.
Republicans wanted President Clinton to assure at least 60-80 votes on the floor, but this was
never attained. Labor interests had been lobbying hard, and few Democrats wanted to
support the measure. Some Democratic Members urged a floor vote to try to get the
undecided Members to commit. House Speaker Gingrich agreed, and set the floor vote for
November 7th then delayed it to Nov. 9th. President Clinton lobbied hard, but there were not
the votes for passage, and House Speaker Gingrich and President Clinton agreed to hold off
on the floor vote. House Speaker Gingrich reportedly said that the vote was about 5-25 votes
short of passage.
The following year, on July 1, 1998, the Senate Finance Committee voted 18-2 to
approve S. 2400 (S.Rept. 105-102), a comprehensive trade bill that included essentially the
same fast-track provisions that the Committee had approved the year before (S. 1269) plus
other trade programs such as trade preferences for sub-Saharan Africa and the Caribbean and
renewal of the Generalized System of Preferences. (Democrats in the House had opposed
the idea of a comprehensive bill the year earlier.) S. 2400 did not reach the Senate floor.
On July 23, 1998, House Speaker Gingrich announced that a vote would be scheduled
on fast-track legislation that September. President Clinton and some Democratic Members
opposed a vote that close to the November elections. They wanted the vote postponed until
the next year. Some Republicans claimed that the Democrats did not want to vote for trade
authority against their labor supporters just before an election. Democrats claimed that the
Republicans scheduled the vote to get agriculture and business support and to hurt the
Democrats. On September 25, 1998, the House voted down fast-track bill H.R. 2621 by a
vote of 180-243. The vote was along strongly partisan lines. Some observers had wondered
if the bill’s defeat would hurt the international markets, but that did not happen. Some also
wondered whether the vote might hurt prospects for fast-track legislation in the future, since
it might be hard for Members to reverse their votes.
During the 106th Congress (1999-2000), there was little done on fast-track renewal. In
1999, the Senate Finance Committee considered the idea of another omnibus trade bill with
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fast track provisions, but decided to split up the proposals and didn’t act on fast-track. With
the presidential election in 2000, there was virtually no activity on fast track that year.
Developments During the 107th Congress
A major issue during the first session of the 107th Congress was how labor and the
environment should be treated in trade agreements. Some Members supported fast-track
reauthorization, but only with strong labor and environmental provisions that could be
enforced with sanctions. They maintained that high domestic labor and environmental
standards put U.S. producers at a competitive disadvantage, and that increased trade with
countries with lax standards may lead to pressure to lower U.S. standards. Other Members
supported labor and environmental provisions but not necessarily with enforcement by
sanction. They wanted the President to have discretion on how to enforce those provisions.
Yet other Members favored excluding labor and the environment completely and limiting
the authority for fast-track implementation to provisions that relate strictly to removal of
trade barriers. They were concerned that, if trade agreements allowed trade sanctions to be
used to enforce environmental and labor rules, such sanctions might be used as protectionist
barriers.
Some Members viewed the U.S.-Jordan free trade agreement (FTA) as a model for how
to address labor and the environment in future agreements. The FTA includes provisions on
labor and the environment in the main text of the agreement, unlike the side agreements of
the NAFTA. It allows a party to call on the agreement’s dispute settlement provisions where
the other party fails to effectively enforce its national labor and environmental laws in a
manner affecting trade between the parties. Other Members, however, opposed the U.S.-
Jordan FTA model. A few Members have suggested the U.S. approach could be patterned
after the Canada-Chile free trade agreement, which includes monetary penalties for violation
of labor and environment provisions. Other Members and USTR Zoellick emphasize there
is no one-size-fits-all model and support a “toolbox” approach that offers a variety of
solutions from which to choose. These many different approaches are seen in the
Administration’s position, a proposal by the New Democrats, and various bills in the House
and in the Senate.
The President’s Legislative Agenda (May 10, 2001)
From its start, the Bush Administration has made trade negotiating authority a priority
of its overall trade policy. During his February 27th State of the Union address, President
Bush said, “Each of the previous five Presidents has had the ability to negotiate far reaching
trade agreements. Tonight I ask you to give me the strong hand of presidential trade
promotion authority, and to do so quickly.”
The Administration also introduced a new phrase to replace the term “fast-track
authority.” During his confirmation hearing on January 30, 2001, U.S. Trade Representative
(USTR) nominee Robert Zoellick said that he would promptly follow up with the Senate
Finance Committee and the House Ways and Means Committee “to consider how to
reestablish trade promotion authority [italics added] for the President, based on the fast-track
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precedent and the broadest possible support.” The term “trade promotion authority”is now
widely used interchangeably with “fast-track authority.”
On May 10, 2001, President Bush provided Congress with an outline of his 2001
legislative agenda for international trade, with trade negotiating authority (TPA) the top
priority. The President’s proposal for TPA stated that the authority would be used for a new
WTO round, a Free Trade Area of the Americas agreement, and other regional and bilateral
negotiations, including free trade agreements with Chile and Singapore. The proposal listed
13 negotiating objectives. One objective would encourage the protection of children and
adherence to core labor standards in connection with international trade, and another would
encourage mutually supportive trade and environmental protection policies in accordance
with the objective of sustainable development, both “in a manner consistent with U.S.
sovereignty and trade expansion.” The Administration proposed that environmental
protection, employment opportunities, and other measures be taken into account in making
decisions on negotiations. It also affirmed that Congress and advisory committees would be
consulted at key stages of each negotiation. The proposal did not include a time period for
the authority, but called for “a sufficient time” for various negotiations.
Along with the legislative agenda, the President submitted an illustrative list identifying
a “toolbox” of actions the United States could take together with trade negotiations.
Examples of toolbox actions included using labor standards in existing trade programs and
highlighting in the National Trade Estimate report measures that hurt the environment.
New Democrats Proposal (May 24, 2001)
On May 24, 2001, the Senate and House New Democrats responded to the President’s
trade promotion agenda with a set of principles. According to a press release from
Representative Dooley, one of the leaders of the New Democrats, the New Democrats
applauded President Bush’s inclusion of labor and environmental standards in the trade
agenda, but argued that the Bush plan was “silent on the critical issue of appropriate
mechanisms for enforcing trade agreements.” The New Democrat principles said that they
were intended to increase access to foreign markets and improve living standards through
trade. The principles stated that labor and the environment should have parity with the other
negotiating objectives and called for enhanced congressional consultation. They also sought
an “enforcement toolbox” that did not preclude any enforcement mechanism. The principles
called for “parallel policies” to increase domestic confidence in trade, such as reauthorization
of trade adjustment assistance and a joint work program with the International Labor
Organization (ILO) and World Trade Organization (WTO). Some congressional Republican
leaders responded by saying that the principles were welcome as a contribution to moving
forward the debate on trade authority.
H.R. 2149, the Trade Promotion Authority Act of 2001
On June 13, 2001, Representative Crane, Chairman of the Trade Subcommittee of the
House Ways and Means Committee, introduced H.R. 2149, the Trade Promotion Authority
Act of 2001. Labor and the environment were not specifically included in any of the
provisions. When the bill was introduced, House Republican leaders said that H.R. 2149
was a first step in the formulation of a trade promotion bill. They looked for quick
consideration and said that the bill would move through committee to the House floor as
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soon as they had the votes for approval. There was immediate opposition to the bill from
House Democratic leaders. The day after the bill was introduced, House Democratic Leader
Gephardt said that the bill “looks like another ‘my way or the highway’ solution to a
problem.” A spokesperson for Finance Committee Chairman Baucus said that the bill
showed there was “a long way to go” in addressing labor and the environment. Many, but
not all, business and agriculture groups supported the bill, while labor and environmental
groups strongly opposed it.
S. 1104, Trade Promotion Act of 2001
On June 26, 2001, Senator Graham, for himself, Senator Murkowski, and seven other
Senators introduced S. 1104, the Trade Promotion Act of 2001. In his introductory
comments, Senator Graham said that the bill was the result of work by himself and Senator
Murkowski to translate the President’s trade principles and the New Democrat priorities into
legislative language.
S. 1104 included worker rights and the environment among its principal objectives. It
also said that in pursuing the principal objectives, negotiators “shall take into account
legitimate United States domestic objectives, including protection of health, safety, essential
security, environmental, consumer, and employment opportunity interests.” Further, the bill
said that the President should “seek to ensure that the trade agreements...complement and
reinforce other policy goals.” Priorities in this area included respect for workers’ rights, and
expanded production and trade while seeking to protect the environment.
The bill included many standard provisions of fast-track/trade promotion authority bills,
but it also included some provisions that were not standard: (1) nontariff agreements under
the bill would have to include exact wording, as specified in the bill, to the effect that the
United States would not be bound by any provision in the agreement that interferes with or
amends any U.S. law or standard relating to health, safety, labor, environment, or essential
security; (2) the implementing bill would be prohibited from making changes in health,
safety, labor, environmental, or security laws or standards; (3) a point of order could strike
any part of the bill (except budgetary provisions) that was in violation of specifically allowed
provisions; and (4) a point of order that an agreement that does not contain the required exact
wording referred to above could cause the loss of expedited procedures. S. 1104 also
provided procedures for withdrawal of expedited procedures before the start of the
negotiations (no reason required), or at any time if notification/consultation requirements
were not met.
Democratic congressional leaders on trade spoke out against the bill. Finance
Committee Chairman Baucus said that the bill was not strong enough with regard to labor
and environmental provisions. Representative Rangel, Ranking Member on the Ways and
Means Committee, and Representative Levin, Ranking Member on the Ways and Means
Subcommittee on Trade, were also critical. A number of Republican Members spoke
favorably of the bill. Senator Grassley, Ranking Member on the Finance Committee, praised
it. USTR Zoellick said he applauded the bill’s sponsors for introducing a bill to grant TPA.
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Proposal by Senator Baucus on July 25, 2001
On July 25, 2001, Finance Committee Chairman Baucus released a proposal for a fast-
track bill. He emphasized that there was little time left in the year for action on a bill, and
he said that he viewed the proposal as a starting point and hoped it would spark the dialogue
necessary to develop a bipartisan approach to fast-track extension.
The proposal listed 13 objectives for trade negotiations. None was specifically related
to labor or the environment.
Under a separate section called “Primary Directions to Negotiators,” the proposal gave
guidelines for labor rights, environmental protection, transparency, and trade laws. On labor
rights, the proposal said that the United States shall seek a requirement that countries not
derogate from domestic labor laws so as to gain trade or investment advantages, affirmation
of countries’ commitments to the five core principles of the International Labor Organization
(ILO), a general exception in the WTO to permit a country to take measures under an ILO
Article dealing with failure of a country to carry out a recommendation, and increased
cooperation between the ILO and the WTO and other international institutions. It said that
the United States shall conduct a labor rights review focused on observance of core ILO
principles; and shall seek provisions allowing restriction of imports made with forced labor,
including exploitative child labor. It further said that for all new trade agreements, the
President would have to transmit to Congress a strategy for implementing and enforcing core
labor standards in countries that are parties to the agreements.
With regard to environmental protection, the proposal stated that all new trade
agreements should be consistent with environmental protection goals. It provided that the
United States shall seek a requirement that countries not derogate from domestic labor laws
so as to gain trade or investment advantages, and the President must transmit to Congress a
strategy for implementing and enforcing core environmental protection standards in countries
that are parties to all new trade agreements. It also said that current environmental reviews
for trade agreements would be included as a statutory requirement for fast-track legislation,
and that actions taken under core multilateral environmental agreements would be “safe
harbored” from legal challenge under trade agreements. It included several guidelines for
investor-to-state disputes. It also said that all trade agreements should recognize the
obligation of national governments to protect their citizens through health and safety
standards.
The proposal attempted to promote transparency in all stages of dispute settlement
processes. It said that the United States should not enter into any trade agreement that
undermined or weakened U.S. trade laws.
The proposal covered fast-track procedures for two years, with a possible three-year
extension. It said authority for a new round of WTO agreements and an FTAA agreement
should be approved in a fast-track bill, but authority for other agreements would have to be
separately requested by the President and approved by the House Ways and Means and
Senate Finance Committees. The proposal included increased congressional oversight by a
new body of Congressional Trade Advisors, who would have access to all negotiating
sessions. It also provided for possible withdrawal of fast-track procedures if negotiating
objectives and directions were not substantially satisfied.
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Reaction to the proposal was mixed. Environmental and labor groups saw the
provisions as weak, and especially opposed the allowance for the President to select from a
range of options under a “flexible enforcement procedure,” since they were critical of how
the Bush Administration would use such discretion. The National Association of
Manufacturers said that although it did not support all of the proposal, it agreed with much
of it. The Administration welcomed the proposals as a “step forward.”
About two and a half months later, Chairman Baucus further outlined his position on
TPA legislation. In a speech on October 11, 2001, he called for greater bipartisanship on a
fast-track bill, saying that otherwise every future trade agreement would be “a struggle to
pass.” He said common ground could be found in several areas: greater cooperation
between the WTO and the International Labor Organization (ILO); restored funding for the
Department of Labor’s International Labor Affairs Bureau; changes to address investment
problems such as those under Chapter 11 of the North American Free Trade Agreement; and
protection of U.S. trade laws. He supported a system for Congress to check if negotiating
objectives have been met. He also said that trade adjustment assistance “must be a part of
any movement forward on fast track.”
H.R. 3019, Comprehensive Trade Negotiating Authority Act of 2001
On October 4, 2001, Representative Rangel, Ranking Member on the House Ways and
Means Committee, and Representative Levin, Ranking Member of the Ways and Means
Subcommittee on Trade, released H.R. 3019. The bill’s supporters said that their proposal
had key differences with H.R. 3005 (see next section), which had just been introduced by
Representative Thomas, Chairman of the Ways and Means Committee. These key
differences, they said, were in the areas of labor standards, environmental issues,
enforcement, and the role of Congress. During the October 9 markup by Ways and Means,
H.R. 3019 was rejected by a 27-12 vote.
The bill included a list of overall objectives that was relatively extensive in comparison
to other bills and prior law. H.R. 3019 also presented sets of principal objectives that
depended on whether a trade agreement was negotiated under the WTO, for the FTAA, or
bilaterally. Although both H.R. 3019 and H.R. 3005 gave more attention to labor and
environmental objectives than in past law, the provisions in H.R. 3019 in general gave more
direction to negotiators on achieving labor and environmental goals.
Nontariff agreements under the bill’s provisions would have to “substantially achieve”
[compared to “make progress in meeting” in H.R. 3005] all the objectives. H.R. 3019
included notification and/or consultation requirements at various stages of negotiation
[generally in more instances than in H.R. 3005], and would amend the current system of
congressional trade advisers, rather than [as proposed in H.R. 3005] establish a new body of
congressional trade advisers.
H.R. 3019 would allow withdrawal of expedited procedures for an implementing bill
before the start of negotiations, during negotiations, and before the President enters into an
agreement if congressional advisers do not concur with the President that the agreement
“substantially achieves the principal negotiating objectives.” In comparison, H.R. 3005
would disallow expedited procedures if the President did not give notice or consult as
required.
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H.R. 3005, Bipartisan Trade Promotion Authority Act of 2001
On October 3, 2001, Representative Thomas, Chairman of the House Ways and Means
Committee, introduced H.R. 3005, a bill to extend trade negotiating authority. Chairman
Thomas had worked with a small number of Democrats on the bill through the summer. The
Democrats included Representative Dooley with the New Democrats, and Representatives
Jefferson and Tanner, both on the Ways and Means Committee. The three Democrats,
Representative Crane, and Representative Dreier, Chairman of the Rules Committee, were
original cosponsors of the bill.
H.R. 3005 was approved by the House Ways and Means Committee on October 9, 2001,
by a vote of 26-13. The Committee markup had originally been scheduled for October 5, but
was postponed because of complaints by Democratic Committee members that more time
was needed to debate key proposals. The bill was reported out of the Ways and Means
Committee (H.Rept. 107-249, Part 1) on October 16.
On December 6, 2001, the House approved H.R. 3005 along party lines by a vote of
215-214. The version of H.R. 3005 considered and approved in the House had been
amended under Rules Committee Resolution H.Res. 306 (H.Rept. 107-323).
Provisions of H.R. 3005 as Passed by the House. The provisions of H.R. 3005
cover tariff and nontariff trade agreements that are reached before June 30, 2005, with a two-
year extension allowed under specified conditions.
Under the section on trade negotiating objectives, the bill outlines seven general
objectives as “Overall Objectives.” Among these are the two objectives of mutually
supportive trade and environmental policies and of respect for worker rights and the rights
of children. The bill has 13 more specific “Principle Objectives.” One of these
objectives–labor and the environment–has drawn much attention. That objective calls for
the following: assurance that parties will not fail to effectively enforce their own
environmental and labor laws; recognition that parties retain wide discretion on domestic
labor and environmental matters; strengthened capacity of U.S. trading partners to promote
respect for labor standards and to protect the environment; elimination of government
practices that threaten sustainable development; market access for U.S. environmental
businesses; and assurance that labor, environmental, health, or safety policies of other
countries do not discriminate against U.S. exports.
The section on objectives also directs the President to take actions that further “certain
priorities,” most of which are related to labor and environmental goals. An example of these
12 actions is that the President must seek greater cooperation between the World Trade
Organization and the International Labor Organization. Of note: this section also directs the
President to preserve the U.S. ability to enforce rigorously its trade laws.
For certain tariff agreements that generally cut tariffs by no more than half and meet
other specified conditions, the President may proclaim tariff changes without implementing
legislation.
For other tariff agreements and for nontariff agreements, the President may enter into
an agreement only if the agreement “makes progress in meeting” the Overall and Principal
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Objectives, and the President satisfies the consultation/notification requirements. Expedited
legislative procedures would apply to an implementing bill with: (1) provisions approving
a trade agreement and any statement of administrative action; and (2) provisions “necessary
or appropriate” to implement an agreement, if changes in law are required to implement the
agreement.
H.R. 3005 includes consultation requirements at various stages of negotiation. (Some
requirements do not apply to tariff agreements that would be implemented through
proclamation). At least 90 days before initiating negotiations, the President would have to
notify Congress of the intent to enter into negotiations and provide specified information.
Before and after giving notice, the President would have to consult with the two revenue
committees, such other committees “as the President deems appropriate,” and the newly
established Congressional Oversight Group (COG; see next paragraph). Additional
consultation would required on certain agricultural tariff matters. During negotiations, the
USTR would have to consult closely with the revenue committees, all committees with
jurisdiction, current congressional trade advisors, and the COG. Before entering into an
agreement, the President would have to consult with the revenue committees, other
committees with jurisdiction, and the COG, and these consultations would have to include
the nature of the agreement and other specified information. The bill sets deadlines for
private sector advisory committee reports and a report by the International Trade
Commission on the agreement’s impacts.
The bill would establish a new body of congressional trade advisors, the Congressional
Oversight Group. Members of the COG would be the chair and ranking member of the
revenue committees (who would co-chair the COG), three other members (no more than two
members from the same party) from each of the revenue committees, and the chair and
ranking member of any other committees with jurisdiction for laws affected by agreements
under negotiation. Members of the COG would be official advisors to the U.S. delegation
and would consult and advise the USTR on aspects of the negotiation.
The section on implementation of trade agreements is similar to other bills and to
previous law. The President would have to notify the House and Senate at least 90 days
before entering into the agreement. Within 60 days of signing the agreement, the President
would have to describe to Congress any changes to law necessary under the agreement. The
President would be required to submit the agreement, a statement of administrative action,
a draft implementing bill, and other specified information (no deadline for submission). H.R.
3005 includes a procedure that would disallow expedited procedures for an implementing
bill, if the President did not give notice or consult as required.
Senate Finance Committee Action on H.R. 3005
On December 12, 2001, the Senate Finance Committee approved its version of H.R.
3005 on an 18-3 vote. The bill was approved “subject to further amendment” because
another Senator reportedly evoked Senate rules to limit the time the Finance Committee
could meet on the bill. The Committee met again on December 18, rejected three
amendments, and ordered H.R. 3005 to be reported with an amendment in the nature of a
substitute (S. Rept. 107-139).
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The version of H.R. 3005 approved by the Senate Finance Committee is similar to the
House-passed version in most respects, but it does have some differences regarding any
negotiated changes to trade remedy law, investor-government disputes, dispute panel action,
and small businesses.
Senate Action on TPA
On May 10, Senators Baucus and Grassley introduced package of trade legislation as
a manager’s amendment (S.Amdt.3401) in the form of a substitute to H.R. 3009, the bill to
reauthorize the Andean Trade Preference Act (ATPA). The amendment includes trade
promotion authority (TPA) as contained in the version of H.R. 3005 that was reported out
of the Senate Finance Committee. It also includes reauthorization of the Trade Adjustment
Assistance (TAA) program, including health insurance subsidies for workers who lose their
jobs because of an increase in imports. Furthermore, the legislation would provide for a five-
year reauthorization of the Generalized System of Preferences (GSP) program, as well as
reauthorization of ATPA. Senate floor action on the legislation is expected the week of May
13. If the Senate approves a TPA bill, a conference would address House-Senate
differences. Analysts predict that as votes get closer to the fall elections, it will become more
difficult for Congress to approve a TPA bill.
A number of amendments to the manager’s amendment were proposed with some
passing. The most controversial to date was S.Amdt.3408 sponsored by Senators Dayton and
Craig. which would allow a point of order to be raised against any provision of an
implementing trade bill receiving TPA consideration, if that provision would weaken any
U.S. trade remedy law. A motion to table the amendment was defeated 38-61, and the
amendment passed on a voice vote. Supporters of the amendment claim that the amendment
is necessary to ensure that U.S. safeguards, antidumping and countervailing duty laws are not
undermined during trade negotiations in the WTO and other fora. The Bush Administration
strongly opposed the Craig-Dayton amendment. It and other critics claim that the
amendment ties the hands U.S. negotiators by restricting their ability to negotiate.
On May 23, 2002, the Senate approved H.R. 3009, which included TPA provisions
under title XXI, by a 66-30 vote.
The bills approved in the House and in the Senate have the same seven overall
objectives, but the Senate bill has an eighth on small businesses. They have the same 13
principal objectives, but the Senate bill adds four more objectives on child labor, human
rights, border taxes, and textile trade. Both bills call for the President to take almost the
same 12 actions to maintain U.S. competitiveness.
The two bills have almost identical language on the President’s authority to proclaim
tariff changes and to negotiate trade agreements with expedited legislative procedures for an
implementing bill. They have essentially the same deadlines for entering into an agreement
for expedited approval procedures. They both state that a trade agreement must “make
progress in meeting” negotiating objectives and describe similar kinds of provisions that an
implementing bill may have. A major difference, however, is a provision in the Senate bill,
called the Dayton-Craig amendment, which would allow any implementing bill provision
amending U.S. trade remedy laws to be stricken from that bill.
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Both bills have similar language regarding notification and consultation before and
during negotiations. They both have special provisions on negotiations on textiles and
agriculture (the Senate bill also includes fish and shellfish). They have much the same
language on consultation with Congress before entering into an agreement, but a major
difference on notification and reporting of proposed changes to trade remedy laws.
Both versions have some similarities on the President’s submission of the trade
agreement and other documents to Congress, and both allow withdrawal of expedited
procedures for lack of consultation. The Senate bill adds language on reporting changes to
trade remedy laws, procedural action in the Senate, and disclosure of oral or written
agreements with other governments. It also adds that expedited procedures will not apply
if an Administration report on dispute strategy is not submitted in a timely manner, or if part
of a trade agreement was not disclosed to Congress.
The two bills are almost identical on establishing a Congressional Oversight Group.
They both provide for adjustment to the pre-notification requirements where negotiations are
underway, require a plan by the President to address enforcement, and state that
congressional trade-related activities could increase. Additional sections in the Senate bill
would require the ITC to report on agreements implemented under expedited procedures in
the past, and would direct the USTR to seek an advocate in the WTO for small- or medium-
sized businesses.
Recent Developments
Following Senate passage, House Ways and Means Committee Chairman Thomas
sought a rule that, he argued, would strengthen the position of the House in the conference.
In a departure from usual practice, he recommended a rule (H.Res. 450) that includes the
House-approved TPA bill, reauthorization of Andean preferences and the Generalized
System of Preferences, TAA, and other provisions. The House had previously approved
some language in the Thomas rule (e.g., TPA) but not other language (e.g., TAA). Almost
all House Democrats oppose the Thomas rule: some reasons they give are the higher TAA
benefits and support for U.S. trade remedy laws in the Senate bill.
On June 19, 2002, the House Rules Committee reported out the Thomas rule. House
floor action on the rule may happen soon. Conferees have not been appointed, but if they
are, analysts expect a conference report could be available before the August recess.
LEGISLATION
H.Res. 306 (Reynolds)
Providing for consideration of the bill (H.R. 3005) to extend trade authorities
procedures with respect to reciprocal trade agreements. Reported as an original measure
(H.Rept. 107-323) and approved by a vote of 224 - 202 on December 6.
H.R. 1446 (English)
Standard Trade Negotiating Authority Act of 2001. A bill to provide permanent trade
negotiating authority. Introduced April 4, 2001; referred to Committees on Ways and
Means; and Rules. The bill would extend fast trade procedures permanently if a newly
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established Commission on Labor and the Environment submitted a report to the President
and Congress, and the President received prior authorization from Congress, before the start
of negotiations. It would exempt agreements under the WTO.
H.R. 2149 (Crane, et. al.)
Trade Promotion Authority Act of 2001. A bill to extend trade authorities procedures
with respect to reciprocal trade agreements. Introduced June 13, 2001; referred to the
Committee on Ways and Means, and in addition to the Committee on Rules, for a period to
be subsequently determined by the Speaker, in each case for consideration of such provisions
as fall within the jurisdiction of the committee concerned.
H.R. 3005 (Thomas, et. al.)
Bipartisan Trade Promotion Authority Act of 2001. A bill to extend trade authorities
procedures with respect to reciprocal trade agreements. Introduced October 3, 2001.
Reported (amended) by the Committee on Ways and Means (H.Rept. 107-249, Part 1)
October 16, 2001. On December 6, 2001, Rules Committee Resolution H.Res. 306 reported
to House. H.Res. 306 provided that the amendment recommended by the Committee on
Ways and Means now printed in the bill, modified by the amendment printed in the H.Rept.
107-323, be considered as adopted. December 6, 2001, passed House by recorded vote: 215
- 214. Referred to the Senate Finance Committee December 12, 2001; mark-up session held.
Ordered to be reported with an amendment in the nature of a substitute favorably (S.Rept.
107-139) December 18, 2001.
H.R. 3009 (Crane, et. al.)
To extend the Andean Trade Preference Act, to grant additional trade benefits under that
Act, and for other purposes. Introduced October 3, 2001; reported, amended, by the
Committee on Ways and Means (H.Rept. 107-290) November 14, 2001. Passed/agreed to
in House by voice vote November 16, 2001. Reported by Senate Finance Committee
Chairman Baucus with an amendment in the nature of a substitute (S.Rept. 107-126)
December 14, 2001. Passed Senate with an amendment by 66 - 30 vote May 23, 2002.
H.R. 3019 (Rangel, et. al.)
Comprehensive Trade Negotiating Authority Act of 2001. A bill to provide fast-track
trade negotiating authority to the President. Introduced October 4, 2001; referred to
Committee on Ways and Means and Committee on Rules.
S. 136 (Gramm)
Fast Track Trade Negotiating Authority Act. A bill to amend the Omnibus Trade and
Competitiveness Act of 1988 to extend trade negotiating and trade agreement implementing
authority through the end of 2004. Introduced January 22, 2001; referred to Finance
Committee.
S. 599 (Roberts, et al.)
Permanent Trade Promotion Authority and Market Access Act of 2001. A bill to amend
the Omnibus Trade and Competitiveness Act of 1988 to establish permanent trade
negotiating and trade agreement implementing authority. Introduced March 22, 2001;
referred to Finance Committee.
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S. 1104 (Graham/Murkowski, et al.)
Trade Promotion Act of 2001. A bill to establish objectives for negotiating, and
procedures for implementing, certain trade agreements. Introduced June 26, 2001; referred
to Finance Committee.
S. 2062 (Durbin)
Comprehensive Trade Negotiating Authority Act of 2002. A bill to provide fast-track
trade negotiating authority to the President. Introduced March 21, 2002; referred to Finance
Committee.
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
U.S. Congress. House. Committee on Rules. Report to accompany H. Res. 450, June 19,
2002. H. Rept. 107-518. 107th Congress, 2nd session. U.S. Govt. Print. Off., 2002. 74
p.
U.S. Congress. House. Committee on Ways and Means. Bipartisan Trade Promotion
Authority Act of 2001. Report together with additional and dissenting views to
accompany H.R. 3005, October 16, 2001. H. Rept. 107-249, Part 1. 107th Congress,
1st session. U.S. Govt. Print. Off., 2001. 83 p.
U.S. Congress. Senate. Committee on Finance. Bipartisan Trade Promotion Authority Act
of 2002. Report together with additional views to accompany H.R. 3005, February 28,
2002. S.Rept. 107-139. 107th Congress, 2d session. U.S. Govt. Print. Off., 2002.
69 p.
——. Andean Trade Preference Expansion Act. Report to accompany H.R. 3009, December
14, 2001. S.Rept. 107-126. 107th Congress, 2d session. U.S. Govt. Print. Off., 2002.
56 p.
CHRONOLOGY
1934 – In the Reciprocal Trade Agreements Act of 1934, Congress begins a policy of
delegating authority to the President to negotiate tariff agreements within limits and to
implement the new tariff levels by proclamation.
01/03/75 – The Trade Act of 1974 is enacted. Under the Act, Congress continues to delegate
to the President the authority to negotiate tariff agreements and implement them by
proclamation. Congress also delegates to the President the authority to negotiate
nontariff trade agreements subject to consultation and notification requirements. For
nontariff agreements reached by specified deadlines, Congress agrees to consider such
agreements under an expedited (“fast track”) procedure.
04/16/94 – After almost continual reauthorization since 1975, the President’s trade
negotiating authority expires.
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09/25/98 – The House disapproves H.R. 2621 by a largely partisan vote of 180-243. The
Administration opposed the vote.
05/10/01 – President Bush outlines his 2001 legislative agenda for international trade. He
places trade promotion authority (TPA) at the top of the agenda.
12/06/01 – The House passes H.R. 3005 by a 215-214 vote along party lines.
5/23/02 – The Senate approves TPA under title XXI of H.R. 3009 by a 66-30 vote.
CRS Products
CRS Report 97-817, Agriculture and Fast Track Trade Legislation, by Geoffrey S. Becker
and Charles E. Hanrahan.
CRS Report RS21004, Fast-Track Negotiating Authority for Trade Agreements and Trade
Promotion Authority: Chronology for Major Votes, by Carolyn C. Smith.
CRS Report RS21078, Trade Adjustment Assistance for Workers: Legislation in the 107th
Congress, by Paul J. Graney.
CRS Report RL31192, Trade Agreement Implementation: Expedited Procedures and
Congressional Control in Existing Law, by Richard S. Beth.
CRS Report RL31178, Trade Promotion Authority (Fast-Track): Labor Issues (Including
H.R. 3005 and H.R. 3019), by Mary Jane Bolle.
CRS Report RL31445, Trade Promotion (Fast-Track) Authority: A Comparison of Bills
Approved by the House (H.R. 3005) and by the Senate (Title XXI of H.R. 3009), by
Lenore Sek and William H. Cooper.
CRS Report 97-896, Why Certain Trade Agreements Are Approved as
Congressional-Executive Agreements Rather than as Treaties, by Jeanne J. Grimmett.
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