Updated February 28, 2023
Presidential Authority to Address Tariff Barriers in Trade
Agreements
The U.S. Constitution grants Congress the power to
implement agreements addressing only tariff barriers
regulate trade with foreign nations and to lay and collect
without further congressional action.
duties. Since the 1930s, Congress has periodically
authorized the President to negotiate trade agreements and,
Timeline of Changes to Presidential Trade
among other actions, proclaim changes to U.S. tariff rates–
Agreement Proclamation Authorities
known as Trade Promotion Authority (TPA). For example,
Section 103(a) of the Bipartisan Congressional Trade
1934 Section 350(a) of the Reciprocal Trade Agreements Act
Priorities and Accountability Act of 2015 (TPA-2015)
of 1934 authorized the President to negotiate bilateral,
authorized the President to enter into trade agreements with
reciprocal trade agreements and proclaim changes to
foreign countries to reduce “duties or other import
U.S. tariff rates of up to 50% of existing rates without
restrictions” that the President determines are “unduly
further congressional action. Renewed 11 times.
burdening and restricting” the United States’ foreign trade
1962 Section 201 of the Trade Expansion Act of 1962, like
and to proclaim limited changes to U.S. tariff rates without
the RTAA, authorized the President to enter into trade
further congressional action. In December 2020, President
agreements and proclaim changes to U.S. tariff rates of
Donald Trump implemented a trade agreement with the
up to 50% of existing rates. Additionally, Section 201
European Union regarding tariff barriers using his
placed no limits on presidential reductions in tariff
proclamation authority under Section 103(a) of TPA-2015.
rates that were already less than 5%.
1975 Section 101 of the Trade Act of 1974 authorized the
TPA-2015 expired on July 1, 2021. Congress may wish to
President to proclaim reductions in U.S. tariff rates of
consider whether to authorize tariff changes without
up to 60% of existing rates (with no limits on rates
congressional action in any future TPA legislation.
already below 5%) and to increase tariffs by up to 20%
History of Authority
of existing rates. While this authority expired in 1979,
Section 124(a) provided limited residual authority for
Section 103(a) of TPA-2015 was the most recent
an additional two years.
congressional delegation of authority to the executive
branch to negotiate trade agreements and proclaim
1988 Section 1102(a) of the Omnibus Trade and
adjustments to customs duties. The first instance was the
Competitiveness Act of 1988 authorized the President
Reciprocal Trade Agreements Act of 1934 (RTAA). Passed
to proclaim reductions in U.S. tariff rates of up to 50%
in the midst of the Great Depression, the RTAA authorized
of existing rates (with no limits on rates already below
the President “to enter into foreign trade agreements with
5%). The 1988 Act limited the President’s ability to
foreign governments” and to proclaim, without further
increase tariffs as part of such an agreement. Several
congressional action, limited modifications to U.S. customs
new technical limitations were also introduced.
duties and import restrictions. Over the next several
2002 Section 2103(a) of the Trade Act of 2002 authorized
decades, presidents negotiated dozens of bilateral trade
the President to proclaim reductions in U.S. tariff rates
agreements addressing tariff barriers and implemented
of up to 50% of existing rates (with no limits on rates
those agreements by proclamation. While the RTAA was
already below 5%). Several new technical limitations
primarily used for bilateral agreements, President Harry
were also introduced.
Truman negotiated and implemented by proclamation the
2015 Section 103(a) of the Bipartisan Congressional Trade
multilateral General Agreement on Tariffs and Trade
Priorities and Accountability Act of 2015 authorizes
(GATT—the precursor to the World Trade Organization)
the President to proclaim reductions in U.S. tariff rates
using RTAA authority.
of up to 50% of existing rates (with no limits on rates
already below 5%). Several new technical limitations
By the late 1960s, nontariff barriers (e.g., regulatory
were also introduced.
barriers or subsidies) had become the focus of multilateral
trade negotiations. Rather than authorize the President to
The result was a bifurcation in trade negotiating authority
proclaim nontariff-related changes to U.S. law, Congress
between agreements affecting tariff barriers and those
enacted the Trade Act of 1974, which added procedures
affecting both tariffs and nontariff barriers. Since 1974,
through which the President could negotiate agreements
TPA has provided authority both to negotiate and to
addressing such barriers and obtain expedited consideration
implement limited agreements addressing tariff barriers
of implementing legislation in Congress if certain criteria
without congressional approval. Section 103(b) of TPA-
were met. Alongside these new procedures, Congress
2015 provides authority to negotiate agreements addressing
continued to authorize the President to negotiate and
tariff and nontariff barriers, and sets out the procedures to
implement those agreements with congressional approval.
https://crsreports.congress.gov

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Presidential Authority to Address Tariff Barriers in Trade Agreements
Most recent U.S. FTAs have covered tariffs and nontariff
Canada Agreement (USMCA). Nevertheless, there have
barriers and have therefore been negotiated under Section
been recent instances of Presidents entering (or notifying
103(b)’s procedures.
Congress of their intent to enter) into limited bilateral trade
agreements under Section 103(a).
Use of 103(a) and Precursor Authority
Since the Trade Act of 1974, Presidents have often used
Agreement on Duty-Free Treatment of Multi-Chip
their proclamation authority in the context of
Integrated Circuits (2006)
comprehensive agreements to implement changes to tariff
In 2005, the European Union, Japan, South Korea, the
barriers, while relying on implementing legislation to effect
United States, and Taiwan agreed to reduce the rate of all
changes to nontariff barriers. For example, during the
customs duties on multi-chip integrated circuits to zero on a
GATT Tokyo Round of multilateral trade negotiations
most-favored-nation (MFN) basis (i.e., the principle that a
(1973 to 1979), President Jimmy Carter relied upon his
country should not discriminate among its trading partners).
proclamation authority to implement preliminary and final
President George W. Bush notified Congress of his
agreements on tariffs (Proclamation 4707), but
intention to enter into the agreement, citing authority under
implemented agreements addressing nontariff barriers
Section 2103(a) of the Trade Act of 2002. On March 31,
through the Trade Agreements Act of 1979 (P.L. 96-39).
2006, President Bush issued Proclamation 7995, which
modified the U.S. Harmonized Tariff Schedule (HTS) to
Presidents have occasionally made use of their authority to
reflect the terms of the agreement.
negotiate and implement limited trade agreements
addressing only tariff barriers. For example, in 1979,
Asia-Pacific Economic Cooperation Agreement on
President Carter entered into a trade agreement with Canada
Environmental Goods (2015)
to reduce tariff rates on certain live cattle imports. President
In 2012, leaders of the 21 Asia-Pacific Economic
Carter used his proclamation authority to implement that
Cooperation (APEC) economies agreed to reduce applied
agreement (Proclamation 4808) without further
tariff rates to 5% or less by the end of 2015 on 54
congressional action.
environmental goods on a MFN basis. On December 23,
2015, President Barack Obama issued Proclamation 9384,
Trade Agreements Implemented in Part
which modified the HTS to reflect the terms of the
with Proclamation Authority Since 1974
agreement. In the Proclamation, President Obama cited
Section 103(a) of TPA-2015 and Section 502 of the
1978 GATT Tokyo Round Bilateral Agreements, Staged
Protecting Americans from Tax Hikes Act of 2015 as
Reductions, and Geneva Protocol (U.S.-India, U.S.-
authority, the latter of which explicitly authorized the use of
Mexico, U.S.-Romania, U.S.-Hungary, U.S.-Taiwan, U.S.-
the proclamation authority provided for in Section 103(a) to
Indonesia, U.S.-Trinidad and Tobago, U.S.-Cartagena
implement an agreement by APEC members on
Agreement Countries, U.S.-Switzerland, U.S.-European
environmental goods.
Communities) (Procl. 4600, 4694, 4707, 4711, 4768)
1978 U.S.-Finland (Procl. 4630)
U.S.-Japan Trade Agreement (2019)
1980 U.S.-Canada (Procl. 4808)
In October 2019, the United States entered into a trade
1981 U.S.-Japan (Procl. 4889)
agreement with Japan, which was negotiated and
implemented under Section 103(a). U.S. commitments in
1982 U.S.-Taiwan (Procl. 4980)
the agreement included, among other things, the reduction
1989 Compact of Free Association with the Marshall Islands
or elimination of tariffs on 241 tariff lines, including 42
and the Federated States of Micronesia (Procl. 6030)
agricultural products ($7.2 billion of U.S. imports), and,
1992 Provisional Agreement on Certain Tropical Products
importantly, modifications to the U.S. global tariff-rate
(Procl. 6515)
quota for imports of Japanese beef. Some Members of 116th
1993 North American Free Trade Agreement (NAFTA)
Congress expressed concern over the agreement’s scope
(Tariff Provisions Only) (Procl. 6641)
and the use of 103(a) to implement it, which differs from
prior U.S. FTA practice. Such concerns have focused on
1994 Uruguay Round Agreements (Tariff Provisions Only)
whether Section 103(a) authorizes the President to go
(Procl. 6763, 6780)
beyond cutting tariff rates to modify quotas and create rules
1995 Tariff-Rate Quota on Tobacco (Procl. 6821)
of origin.
2006 Agreement on Duty-Free Treatment of Multi-Chip
Integrated Circuits (Procl. 7995)
U.S.-EU Trade Agreement (2020)
In November 2020, the United States entered into a trade
2015 Asia-Pacific Economic Cooperation Agreement on
agreement with the European Union, which was negotiated
Environmental Goods (Procl. 9384)
and implemented under Section 103(a). The agreement
2019 U.S.-Japan (Procl. 9974)
included the reduction of tariffs on 11 tariff lines, which
2020 U.S.-EU (Procl. 10128)
include, among other products, certain prepared meals,
certain crystal glassware, surface preparations, propellant
Recent Uses
powders, cigarette lighters, and lighter parts. The reductions
Since the 1970s, Presidents have generally used Section
were implemented on a MFN basis and are retroactive to
103(a) of TPA-2015 and its precursor authorities to modify
August 1, 2020.
tariff rates, as part of more comprehensive multilateral trade
negotiations, such as the proposed United States-Mexico-
https://crsreports.congress.gov

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Presidential Authority to Address Tariff Barriers in Trade Agreements

Brandon J. Murrill, Legislative Attorney
IF11400
Christopher A. Casey, Analyst in International Trade and
Finance


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https://crsreports.congress.gov | IF11400 · VERSION 6 · UPDATED

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