The WTO Withdrawal Resolutions

The WTO Withdrawal Resolutions

INSIGHTi

The WTO Withdrawal Resolutions
May 21, 2020

The United States was a major force behind the creation of the multilateral trading system that emerged
after World War II. That system was based on negotiated rounds of trade liberalization and common trade
rules, most recently through the Uruguay Round (1986-1994) and the establishment of the World Trade
Organization (WTO) in 1995. The WTO, and the General Agreement on Tariffs and Trade (GATT) before
it, serves as the foundation of the world trading system. However, after 25 years, WTO’s 164 members
have been unable to conclude a new round of multilateral negotiations. Thus, greater debate has arisen
among Members of Congress about the benefits of the WTO, as wel as cal s for reform and renewed
negotiations.
Section 125 of the Uruguay Round Agreements Act (URAA) (P.L. 103-465), which approved and
implemented the Uruguay Round Agreements, requires the U.S. Trade Representative (USTR) to submit a
report to Congress every five years analyzing the costs and benefits of U.S. participation in the WTO.
Once Congress receives this report, any Member may introduce a privileged joint resolution proposing to
withdraw congressional approval of the WTO Agreements. The Ways and Means Committee rationale for
this possibility was to:
provide an opportunity for the Congress to evaluate the transition of the GATT to the WTO and to
assess periodically whether continued membership in this organization is in the best interest of the
United States. It is the desire of the Committee not to leave this decision totally in the hands of the
Executive Branch...
This year, the House received the report on March 4, 2020, and the Senate on March 5. Withdrawal
resolutions were introduced in the Senate (S.J.Res. 71, Hawley) on May 7, 2020, and in the House
(H.J.Res. 89, DeFazio, Pal one) on May 12. The resolutions have been referred to the Senate Finance
Committee and House Ways and Means Committee, respectively, in accordance with specified
parliamentary procedure.
Disapproval resolutions were introduced in prior years in the House in 2000 and 2005. They were
reported adversely by the House Ways and Means Committee (HWMC) and defeated by relatively large
margins. No resolutions were introduced in 2010 and 2015.
Congressional Research Service
https://crsreports.congress.gov
IN11399
CRS INSIGHT

Prepared for Members and
Committees of Congress

Congressional Research Service
2
Procedure
House and Senate consideration of a joint resolution disapproving U.S. partic ipation in the WTO is
governed by expedited parliamentary procedures contained in Sec. 125 of the URAA and Sec. 152 of the
Trade Act of 1974. These procedures are designed to ensure that Congress could choose to pass the joint
resolution and present it to the President before the end of a 90-day period that begins on the day
Congress receives the USTR report.
Joint resolutions can be submitted in either chamber at any time during the 90-day period, have a
specified text, and are referred to HWMC or Senate Finance Committees. A committee must report the
referred measure by the close of the 45th day after introduction or be automatical y discharged of it.
Resolutions may be cal ed up on the floor of each chamber by non-debatable motion (although two
legislative days’ notice is required in the House). A joint resolution is debatable for up to 20 hours and is
unamendable. A motion to recommit is not permitted. In the case of a presidential veto, an override must
occur by the later of the end of the 90-day period or by the close of a 15-day period that begins when
Congress receives the veto message. Debate on a veto message in the Senate is limited to 10 hours. The
90-, 45-, and 15-day time periods described above exclude some days on which the chambers do not
meet. In the Senate, the non-debatable motion to take up a joint resolution, coupled with the limits on
amending and debate, mean that a numerical majority in that chamber could take up and agree to a joint
resolution without a cloture process and the associated supermajority requirement.
These provisions are considered to be rules of the House and Senate, respectively, and can be altered or
overridden by resolution (including a special rule in the House), by suspension of the rules, or by
unanimous consent.
Debates over the WTO
Debates on WTO membership in 2000 and 2005 were characterized by concerns about certain dispute
settlement cases, especial y adverse decisions on trade remedies, and related apprehensions that WTO
membership impinges U.S. sovereignty. WTO supporters emphasized the economic benefits and value of
an open and rules-based trading system. Several factors shaped past debates. In 2000, China had yet to
join the WTO. In 2005, China had acceded but was not yet playing a pivotal role, and the Doha
Development Round, launched in 2001, was actively being negotiated.
More recently, U.S. concerns with the WTO have grown in some quarters and perception of WTO’s
benefits may have dimmed. The USTR report did not advocate withdrawal from the WTO—referring to it
as the foundation of the international trading system—but cal ed for reform of the organization.
Administration concerns highlighted perceived overreach by the dispute settlement system, use of special
and differential treatment by advanced emerging economies, and paralysis of the WTO negotiating
function.
Consequences of Possible Withdrawal
U.S. withdrawal from the WTO could have a number of consequences. Supporters of withdrawal claim it
would restore U.S. sovereignty by relieving the United States from its WTO obligations. They point out
that WTO agreements do not include labor and environmental obligations, al egedly leading to lost jobs
and offshoring. The United States could impose more unilateral trade measures, including tariffs, without
the need to justify its measures at WTO dispute settlement. Withdrawal would al ow the United States to
pursue Buy American policies absent its commitments under the WTO Government Procurement
Agreement.

Congressional Research Service
3

Opponents of U.S. withdrawal raise several concerns. Withdrawal would enable the remaining 163 WTO
members to renege on their WTO obligations to the United States, such as the principle of non-
discrimination, which underpins most-favored nation treatment and national treatment. In particular, the
United States could face disadvantages in other large markets without U.S. bilateral free trade
agreements, including China and the EU. For example, they could apply different agricultural and
technical standards to U.S. products. Other countries would have no obligation to tel U.S. exporters why
their shipments are being detained, seized, or refused entry by customs agencies. U.S. innovators would
receive no protection from WTO intel ectual property standards. Final y, it would also remove the United
States from a body whose core function is to shape the multilateral trading system, and to al ow other
major economies, including China, a greater role.
U.S. withdrawal from the WTO, would be a pivotal moment in trade policy. These resolutions may afford
Members of Congress the chance to debate not only whether the WTO is worthy of membership, but of
reforming the institution and how to best shape the multilateral trading system.

Author Information

Ian F. Fergusson
Christopher M. Davis
Specialist in International Trade and Finance
Analyst on Congress and the Legislative Process

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.

IN11399 · VERSION 1 · NEW