TPP discusses UK membership.

united kingdom marching band
Photo by David Jakab on Pexels.com

According to the Kyodo news, the current 11 members of the Trans-Pacific Partnership (TPP) began discussing the United Kingdom’s bid to join the trade pact. If approved, the UK will be the 12th member since the creation of the TPP in 2018. At the time of this post, China and Taiwan have also submitted applications to join the free trade agreement.

While typically known as the TPP, the official name is called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP. The chair of the organization rotates and the current chair is Japan.

Entry to the CPTPP requires applicant countries to revise their domestic laws and regulations to meet TPP criteria. If approved, the UK will join Brunei, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Taiwan’s CPTPP application followed by China’s CPTPP application.

city during nighttime
Photo by Timo Volz on Pexels.com

According to a Reuters article, Taiwan’s economy minister, Mei-hua Wang, voiced concern last week after China’s “sudden” decision to apply to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) following Taiwan’s application.

In response, the Taiwan economy minister claims China’s current policies are counter to the principles of free trade and transparency expected by CPTPP members – such as China’s use of import bans and potential inability to meet the high standards required of CPTPP participating countries.

According to the Reuters article, one such motivation for China’s sudden application is because China views Taiwan as part of its territory and does not want Taiwan to join before they join.

The CPTPP was originally going to be known as the Trans-Pacific Partnership (TPP) but the trade agreement was drastically changed in 2017 when former President Donald Trump withdrew the US from the agreement. This led to creation of the current CPTPP linking the following countries: Canada, Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Besides Taiwan and China, Britain is also applying for membership.

Lastly, Reuters writes Taiwan has been heartened by recent progress towards trade agreements with the United States and the European Union, which are both frustrated with China’s lack of progress in opening its economy and are keen to show their support for Taiwan’s democracy and much freer market policies.

Taiwan to join the Trans-Pacific Partnership?

Hsinchu, Taiwan.

The Obama administration supported the US’s participation in Trans-Pacific Partnership (TPP) – a multilateral trade agreement between the US and 11 other nations: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. When President Donald Trump won the presidency in 2016, he fulfilled his campaign promise and withdrew from the TPP.

Following the US withdrawal – the remaining nations named the trade deal the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) linking Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

This past week, Taiwan announced they will submit an application to join the CPTPP. New member applications are required to hold informal talks with existing member and reach a consensus before they can apply.

One potential roadblock for Taiwan’s entry into the CPTPP could be China’s joint application to join the CPTPP.

If you have any questions about the TPP, CPTPP or any other trade agreement – contact David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com.

Advance rulings: limiting your USMCA import liability.

business commerce container export
Photo by Kaique Rocha on Pexels.com

Every importer of record needs to make declarations to Customs regarding tariff classification, valuation, origin of imported goods and more. Incorrect declarations can potentially lead to long term and expensive problems for the importer.

The NAFTA rules provided a method in which importers could seek guidance from Customs through an advance ruling to predetermine tariff classification, valuation, regional value issues, questions on qualifications of originating good, country of origin marking requirements, and more. NAFTA limited requests for guidance to only importers in the US and exporters and producers in Canada and Mexico who exported their goods to the US.

Fortunately, the new USMCA implemented several key changes. First, the USMCA not only allows an importer, but also allows an exporter, producer or anyone related to the trade transaction to request an advance ruling. Advance ruling requests are no longer limited to domestic residents.

Secondly, the USMCA agreement requires Customs to make a decision within 120 days – increasing transparency and predictability to the advance ruling process. Additionally, the USMCA also identifies the subjects that can be decided through ruling requests – tariff classification, customs valuation, origin of goods, quotas or “other issues agreed upon”.

Lastly, the USMCA offers increased protection in the event of customs modifying or revoking an advance ruling. Under the USMCA, an advance ruling cannot be revoked or modified if doing so will hurt the original ruling requester – unless the requester did not follow the advance ruling or the ruling was based on false information provided by the requester.

The best way to limit your USMCA import liability is to request an advance ruling – taking out the guesswork before the goods are shipped or entered into the US. Please do not hesitate to contact David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com.

USMCA regulations published.

As the USMCA is set to take effect in less than a month, the USTR has published the USMCA regulations on their website. The regulations can be viewed at the following: https://ustr.gov/trade-agreements/free-trade-agreements/united-states-mexico-canada-agreement/uniform-regulations

This is a long read and I haven’t read through a quarter of it. Will likely take me the entire weekend to go through the agreement.

In the meantime, if you have any questions how the new USMCA rules will impact your business, give me a call anytime or text, 832-896-6288 or by email at attorney.dave@yahoo.com.

EU and Mexico reach new trade agreement.

pexels-photo-113885

Photo by freestocks.org on Pexels.com

Last week was the culmination of two years of negotiation between the European Union and Mexico to reach a new free-trade agreement. The last trade deal occurred in 2000 and that trade deal covered only industrial goods.

Details of the EU-Mexico trade agreement can be downloaded in PDF directly from the EU website here. Part of the new EU/Mexico trade deal changes include:

1. Almost all goods between the Mexico and EU will be duty free;
2. New rules on sustainable development and implementation of Paris Climate Agreement;
3. New rules on investment protection;
4. Simpler customs procedures to help boost exports.

While the terms of the agreement have been reached, the next step is to finalize the agreement, translate into EU languages and then submit the proposed agreement for signature and conclusion to the Council and European Parliament.

Canada approves USMCA trade deal.

pexels-photo-374870

Photo by Burst on Pexels.com

While the US is focused on the Corona Virus (COVID-19), on Friday, Canada formally approved the United States-Mexico-Canada Agreement (USMCA), the last nation needed to implement the deal to replace the 25-year-old North American Free Trade Agreement (NAFTA).

The trade deal was ratified by the Mexican legislature last June, the US legislature this past January and formally ratified by Canada on Friday. The Canadian parliament is now shut down for five weeks in response to the coronavirus pandemic.

Contact experienced trade attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com if you have any questions about how the new USMCA will impact you and your business!

US – UK trade deal by end of the year?

pexels-photo-1906879

Photo by Alessio Cesario on Pexels.com

With the UK set to formally leave the EU at 11:00 pm next Friday, January 31st, both the US and the UK have expressed strong interest in forming their own trade deal expected to be reached by the end of the year.

The goal at the end of the year reflects a comment by US Treasury Secretary Mr. Mnuchin in December 31 stating he wanted an “aggressive timeline” and that “It’s an absolute priority of President Trump and we expect to complete that within this year.”

Besides the US, it is expected that the UK seek trade deals with world wide and even the EU. EU negotiator Michel Barnier mentioned that “We are looking at a possibility of a relationship in the trade side where we will have zero tariffs and zero quotas between the EU and UK.” This would be the first for any non EU party and would allow access to the 450 million people under the EU umbrella.

USMCA to be signed on Wednesday 1/29.

Donald_Trump_official_portrait

Official portrait of President Donald J. Trump, Friday, October 6, 2017. (Official White House photo by Shealah Craighead)

As you are aware, the Senate passed the USMCA legislation last week. According to Reuters, President Trump will sign the USMCA trade agreement next Wednesday at the White House. The Reuters article cites unnamed sources regarding invitations for the upcoming ceremony.

This new US Mexico Canada Agreement (USMCA) wills replace NAFTA and still requires formal approval from Canada.

Contact experienced trade attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com if you have questions how the new USMCA may impact your business.

What’s the current status of France’s proposed digital tax?

pexels-photo-705764

Photo by TravelingTart on Pexels.com

Last year, France threatened a “digital tax” of 3% on digital revenue of big tech companies such as Facebook and Google. In response, the US threatened tariffs on $2.4 billion of French goods such as wine, cheese, and makeup.

On Monday, January 20th, France said they would delay the the tariffs for the remainder of 2020 in response to US pressure.

And earlier today, at the Davos World Economic Forum, US Treasury Secretary Steven Mnuchin reiterated the Trump administration’s claim a digital tax is discriminatory and in response, he threatened tariffs on auto manufacturers if a deal does not work out and the digtal tax is put into effect.

What’s next? Treasury Secretary Mnuchin and his counterpart, France’s foreign minister Bruno Le Maire met earlier today (Wednesday January 22nd), but no news has been released about an agreement between the US and France. Will post more news as it is released.