Q: When was the Interagency Trade Enforcement Center (ITEC) established?
A: On February 28, 2012, the President signed Executive Order 13601 establishing ITEC to enhance enforcement of U.S. trade rights and domestic trade laws.
Q: What is ITEC’s mission?
A: ITEC is charged with fighting for American workers, farmers, ranchers, and businesses by bringing a more aggressive “whole-of-government” approach to addressing unfair trade practices around the world. ITEC will be supported by the Departments of Agriculture, Homeland Security, Justice, State, and the Treasury, as well as the intelligence community. The personnel from these agencies will enhance U.S. trade enforcement capabilities and facilitate increased engagement with foreign trade partners at the World Trade Organization (WTO) and elsewhere through the creation of an expanded team of language-proficient researchers, subject matter experts, and economic analysts. ITEC is designed to help leverage and mobilize resources and expertise across the federal government to develop trade enforcement actions that will address unfair foreign trade practices and barriers that could otherwise imperil our nation’s export promotion and job recovery efforts.
Q: How is ITEC different from existing trade enforcement programs?
A: ITEC is unique in that it constitutes a more dedicated “whole-of-government” approach to addressing unfair trade practices and trade barriers. This new approach will provide a primary forum within the federal government to bring together experts from executive departments and agencies to coordinate trade enforcement. ITEC will permit a sustained focus on particular issues not possible previously.
Q: Doesn’t the U.S. government already have the capacity to address unfair trade practices and trade barriers?
A: A priority of the Administration is to better leverage the government’s trade enforcement activities by focusing its existing resources to address unfair trade practices and foreign trade barriers more effectively. ITEC will link, leverage and align both existing and new resources more efficiently across the executive branch and with stakeholders. The key here is efficiency. ITEC’s goal is to build upon existing capacity to give U.S. companies, workers and producers every chance to compete on a level playing field in today’s global marketplace.
Q: How many people will be working at ITEC at any given time?
A: By October 2012, ITEC had more than a dozen full-time and part-time staff and that number should increase substantially by the end of FY13. These figures are subject to change as issues, priorities and available funding change.
Q: How do you determine the issues for priority attention and action?
A: The Director and Deputy Director, along with the various offices within USTR, and in cooperation with other agencies will examine various trade issues and will establish priority projects for investigation. As is currently the case, a variety of factors will be taken into account in setting those priorities, including economic impact of the issue, systemic impact of resolution on international trading practices, ability to document and demonstrate the problem, available resources, and broad trade goals.
Q: Is ITEC’s purpose to bring more trade remedies and WTO cases against Chinese products?
A: ITEC’s purpose is to help ensure that all of our trading partners play by WTO rules and abide by their obligations, including commitments to maintain open markets on a non-discriminatory basis, and to follow rules-based procedures in a transparent way.
Q: What countries will ITEC be working on?
A: ITEC will be addressing trade enforcement issues originating in a variety of regions across the globe. It is USTR policy not to discuss publicly cases that it is developing to avoid giving advance notice to governments overseas.
Q: What will the role of ITEC be in administering domestic trade laws?
A: The Department of Commerce has statutory responsibility for administration of the antidumping and countervailing duty (AD/CVD) laws and will continue to administer them. The International Trade Commission (ITC) will continue to make injury determinations with regard to all AD/CVD investigations and sunset reviews. ITEC was not intended to duplicate the efforts that are assigned by statute to particular agencies. ITEC will be looking for areas where it can add value to the work already being done.
Q: What will the role of ITEC be in dealing with circumvention of antidumping and countervailing duty orders?
A: Import Administration’s Customs Unit and U.S. Customs and Border Protection will continue to take the lead on issues related to circumvention of antidumping and countervailing duty orders. Deliberate evasion of AD/CVD duties by providing false information in a customs declaration constitutes customs fraud, and is a breach of U.S. law, punishable by fine or imprisonment. In addition, the National Intellectual Property Rights Coordination Center (NIPRCC) plans to step up enforcement of commercial fraud laws related to evasion of antidumping and countervailing duties.
Q: Will ITEC be involved in “self-initiation” of antidumping or countervailing duty cases?
A: Antidumping and countervailing duty investigations may be initiated as the result of a petition filed by a domestic interested party or at the Secretary of Commerce's own initiative. Self-initiation of such investigations has been a very rare occurrence. However, should the Secretary of Commerce request ITEC assistance in such a self-initiation, ITEC will provide support as appropriate.
Q: How will ITEC engage with the NIPRCC and the Intellectual Property Enforcement Coordinator (IPEC)?
A: The NIPRCC’s focus is on the law enforcement response to IPR theft, primarily coordinating investigation and prosecution of IPR infringers under the criminal laws of the United States. The NIPRCC also is a key participant in international cooperation on criminal enforcement activities involving various other partner governments and international police organizations such as Interpol and Europol. ITEC’s focus is enforcement of U.S. rights under trade agreements across a wide set of issues – including intellectual property. ITEC has and will continue to coordinate with the NIPRCC and the IPEC.
Q: Will ITEC serve a rapid response function, including with respect to identifying subsidies in overseas markets?
A: ITEC will be focusing on enforcement of U.S. rights under trade agreements which require some time to investigate, develop, and coordinate. However, to the extent ITEC becomes aware of issues requiring a rapid response through its monitoring or outreach functions, it will bring such issues to the attention of that part of USTR or another agency best positioned to take more immediate action.
Q: How will ITEC help small and medium-sized enterprises? What is the difference between what ITEC does and what the Trade Compliance Center at the Department of Commerce does?
A: Small and medium-sized enterprises (SMEs) are encouraged to continue to report their specific market access problems to the Trade Compliance Center (TCC) at the Department of Commerce. If the TCC is unable to resolve an issue, especially when it has noted a trend, the TCC will report the problem to ITEC. By leveraging the expertise of the TCC, ITEC will have a head start on dealing with trade issues that are affecting SMEs. Small and medium-sized enterprises may also work through their associations to bring industry-wide problems to the attention of ITEC.
Q: How will ITEC interact with other parts of USTR that may already be engaged in working on an issue of concern to certain companies or industries?
A: ITEC is in close contact with the various offices within USTR. USTR sector experts and negotiators are aware of ITEC activities and vice versa to ensure full coordination. Parties which have been working closely with USTR offices on issues of concern should continue to do so.
Q: What role will ITEC play in section 301 cases?
A: Interested persons may file petitions with USTR under section 301 of the Trade Act. Depending on the nature of the petition, ITEC may be involved in doing additional research during the 301 investigation phase. It is important to note that, although USTR can initiate a section 301 investigation itself, USTR does not need to do so in order to initiate WTO dispute settlement action. With regard to the majority of WTO dispute settlement actions, we anticipate that ITEC will be doing some of the same types of research that outside parties would typically do themselves in order to file a 301 petition.
Q: What role will ITEC play in section 201 cases?
A: Section 201 investigations will continue to be carried out by the International Trade Commission, which has statutory responsibility for implementing this section of U.S. trade law. Although it is a historically rare occurrence, the President or USTR can request the ITC to conduct a section 201 investigation. ITEC may have a role in providing information that can be used to inform the decision as to whether the President or USTR should make such a request.
Q: Will ITEC monitor the new free trade agreements to ensure that trading partners are not erecting new non-tariff barriers that would limit the benefits U.S. companies are supposed to gain from the agreements?
A: While ITEC will monitor certain issues, it does not have the staff to monitor every aspect of every FTA. ITEC continues to work with other offices within USTR to ensure compliance with FTAs and will continue to request that industry and companies bring problems to ITEC’s attention.
The Obama Administration’s balanced approach to trade is growing exports abroad and expanding job opportunities at home. Presented below are just a few of the many success stories which have resulted from the Administration’s focus on tearing down trade barriers and opening access to new markets.
The Langdale Company
The Langdale Company is just one example of how a small business is poised to win the future through trade. The company currently exports their industrial wood products from ten manufacturing facilities in Georgia to Asia, the Caribbean, Central America, Europe, and Mexico. For over 35 years, Langdale has exported to different markets around the world, spreading Langdale’s reputation for exceptional service, competitive prices, and an extensive product line. And Langdale has plans to expand into even more global markets.
Even with such a large portfolio of international customers, the Langdale Company has its eye on the South Korean market’s tremendous business opportunities. Bryan Harvey, vice president of sales, sees the South Korean market as a large growth opportunity for his company, but before the trade agreement, barriers to trade limited Langdale’s growth in South Korea.
“The passage of the U.S.-South Korea trade agreement eliminates duties, thereby making our products more affordable. This helps increase our export volumes to the South Korea market,” said Harvey.
Although the product that Langdale currently exports to South Korea does not receive immediate tariff elimination, this company's long-term growth plans still benefit from lower duties and increased competitiveness from the phase out of Korea’s tariffs on this product under the agreement.
South Korea is our seventh largest trading partner, but before the agreement was in effect, exporting to South Korea currently has a few price tags. American businesses were charged an average tariff of 5.9 percent, which used to reach as high as 12 percent, to export wood and lumber. Estimated duties paid on exports of U.S. wood and lumber to South Korea were over $17 million from 2007 to 2009. However, more than 93 percent of U.S. wood and lumber exports to South Korea by value now receive duty-free treatment in the first three years of implementation of the U.S.-South Korea trade agreement.
The U.S.-South Korea trade agreement also allows Langdale the opportunity to export a wider portfolio of existing products to the South Korean market.
Trade and Jobs Case Study
Florida is known for many things. Whether it’s for sunny beaches, amusement parks or the everglades, people flock to Florida for a variety of reasons. However, what most people may not know is that Florida is the fourth largest state exporter in the United States.
From agriculture to manufacturing to services, Floridians all across the sunshine state depend on trade for their paycheck. For example, in 2008, jobs supported by Florida’s goods exports were estimated to be 168,000 – and these jobs pay 13-19 percent higher than the national average wage.
While most people think of Florida for its citrus and citrus juices – and for good reason as Florida is the third largest state exporter of fruit – many people forget about Florida’s booming manufacturing sector. Exports of computers, transportation equipment, chemicals, and machinery led to an 89 percent increase in exports in just 10 years. One of seven manufacturing workers in Florida depends on exports for their job.
The same goes for workers in the agricultural sector. More than 25,400 jobs in Florida are supported both on and off the farm in food processing, storage, and transportation by agricultural exports. These exports will only increase now that trade tariff barriers have been removed with Korea and Colombia, and will increase even more once the free trade agreement with Panama is implemented.
Besides working to implement trade agreements with Korea, Colombia, and Panama to help Florida exporters, USTR is working on the Trans-Pacific Partnership (TPP). This new 21st-century agreement will provide new opportunities for Florida businesses to export to various Asia-Pacific countries, opening new markets for high-quality Florida goods to be sold around the world.
Hawaiian Isles Kona Coffee Co.
Hawaiian Isles Kona Coffee Company provides Hawaiian-grown coffee and bottled water. The Hawaiian Isles Water and Kona Coffee brands are some of only a few Hawaii-inspired coffee and water products made entirely by local workers in Hawaii.
Hawaiian Isles currently exports roughly 8,000 cases of coffee and 35,000 cases of water to international markets every year with over 80 percent of that making it to markets in the Asia-Pacific region including Japan, South Korea, China, Taiwan, Hong Kong, and Canada. Although this currently only represents a small percentage of their overall business, Hawaiian Isles has been looking for ways to expand their exports to allow them to grow their business and support Hawaiian jobs.
Currently, trade barriers in the Asia-Pacific region raise the cost of many Hawaiian Isles’ export products.
At APEC, USTR is working with our Asia-Pacific trading partners to address trade barriers and help companies like Hawaiian Isles compete on a level playing field.
“The opportunity to compete in other markets would provide a healthy growth in our sales and help us toward our vision of being a world leader in Hawaiian-based products,” said Glenn Boulware, Director of Business Development and Strategic Planning for Hawaiian Isles Kona Coffee Company.
With increased trade, Hawaiian Isles would be able to expand their business in the United States. The company relies heavily on U.S. workers for the manufacturing and distribution of their agricultural and natural products. An expansion in trade will therefore increase demand for both manufacturing equipment and employees, as well as production for their agricultural and natural products.
“This upgrade and expansion of our capabilities will mean the creation of additional jobs and even new jobs to meet the new demands of entering into new markets,” Boulware said.
Marlin Steel Wire Products LLC
Marlin Steel Wire Products LLC of Baltimore, Maryland is a U.S. based and owned manufacturer of steel products. Marlin, founded in 1968, carries an extensive inventory of baskets, racks, grates, hooks, screens, skimmers, and custom wire products. Marlin exports its products to over 25 countries around the world; it counts major multinational corporations like General Motors, Honeywell, Boeing, and Toyota among its clients.Recently, Marlin began exporting to 4 new countries: China, England, New Zealand, and Switzerland. Marlin credits increased exports for its ability to hire more workers and increase sales.
USTR seeks to help small businesses like Marlin export even more of their products. Ambassador Kirk instituted an agency-wide effort to bolster trade opportunities for small and medium-sized businesses, and requested three investigations to learn more about how the export market for small and medium sized businesses works.