Trading Up: Don’t Use TPP to Enable Trade Restrictions

By November 13, 2013Economy, Trade

Transparency. Due Process. Fairness. Nondiscrimination. Decisions based on facts and sound scientific evidence. These are among the bedrock principles that have guided the global trading system for more than 65 years.

International trade rules allow the United States and the more than 155 other members of the World Trade Organization (WTO) to take measures “necessary to protect human, animal or plant life and health” – provided those measures do not “constitute a means of arbitrary or unjustifiable discrimination between countries … or a disguised restriction on international trade.”

These rules guarantee governments’ right to regulate without creating exceptions for discriminatory, unfair or otherwise protectionist actions. They have stood the test of time and been included intact in every modern U.S. free trade agreement.

But now the Administration has proposed altering these rules in the Trans-Pacific Partnership (TPP) through a product-specific reference for tobacco that the Office of the U.S. Trade Representative says would enable public health officials to “regulate tobacco without being challenged under rules that are intended to prevent restrictions on trade and investment.”

The Administration has offered no good reason why America needs to toss aside longstanding principles of fairness and due process. Of the WTO’s more than 465 dispute settlement cases taken over the last 20 years, only two involved a tobacco control measure. And just one of those was filed against the United States. (We lost, by the way – not because we controlled a tobacco product, but because the measure was too narrow.)

The fact is that no U.S. trade agreement prevents American officials from regulating in the public interest. Indeed, trade agreements expressly anticipate and sanction public health regulations – something the Administration acknowledged in its submission of the U.S.-Korea Free Trade Agreement to Congress in 2011.

But a misguided exception for one product could put many U.S. exports at risk. Tobacco is hardly unique, as a wide range of organizations have already pointed out in a recent letter to the U.S. Trade Representative.

Over the last four years, countries across Asia, Africa, Latin America and the Middle East have proposed regulatory control measures for products ranging from distilled spirits to processed foods.

If those countries follow our example, how long before the exception becomes the rule and U.S. efforts to protect our exporters against unfair and discriminatory barriers is substantially limited? Such a result would have devastating consequences for U.S. exports and the jobs they sustain and create in the United States.

This slippery slope toward carving up trade deals is all the more reason for TPP negotiators to just say no to an unnecessary and potentially damaging change in global trade rules and practice. Trade agreements are and must remain tools to level the playing field, ensure fairness and remove barriers – not enable them.

Trading Up is a blog series from manufacturers, which focuses on the need for a comprehensive, high-standard Trans-Pacific Partnership (TPP) that eliminates barriers, creates concrete new market access and levels the playing field for manufacturers in the United States.

 

 

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