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The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade agreement will come into force at the end of the year.  The agreement between 11 nations along the Pacific Rim - Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam- represents 13.5% of the world’s GDP.  One of the largest trade agreements in world, the provisions not only cover trade in goods and services, but also includes requirements in areas such as labor, the environment and government procurement.

This agreement has been a decade in the making, and has been high-profile in U.S. trade policy and news.  Previously called TPP, the Trans-Pacific Partnership, the U.S. was the 12th nation involved in negotiations to develop this trade region.  The TPP was originally touted as a way to increase U.S. clout in Asia and put in check China’s global economic and military expansion.  U.S. involvement with these negotiations began in 2008 under President Bush and an agreement was reached after 19 official rounds of negotiations in October 2015 under President Obama.  The agreement was not ratified by the U.S. Congress in 2016.  In January 2017, President Donald Trump signed an executive order withdrawing the United States from the Trans-Pacific Partnership (TPP) agreement. In May 2017, all remaining original TPP signatories agreed to continue negotiations without the U.S. and ultimately came to agreement in January 2018.  The newly named CPTPP incorporates most of the original trade language, but does suspend 22 provisions of the TPP.  Under the agreement, after ratification by at least 50% of the signatories, the agreement enters into effect 60 days later.  With Australia being the sixth country to ratify the agreement on October 31, 2018, the CPTPP agreement will come into force on December 30, 2018.

FOR IMMEDIATE RELEASE                                                                            

August 27, 2018

Contact: USTR Public & Media Affairs

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Published by the Office of the U.S. Trade Representative at https://ustr.gov/about-us/policy-offices/press-office/press-releases/2018/august/modernizing-nafta-be-21st-century

The United States and Mexico have reached a preliminary agreement in principle, subject to finalization and implementation, to update the 24-year-old NAFTA with modern provisions representing a 21st century, high-standard agreement.  The updated agreement will support mutually beneficial trade leading to freer markets, fairer trade, and robust economic growth in North America.

INTELLECTUAL PROPERTY

The United States and Mexico have reached an agreement on a modernized, high-standard Intellectual Property (IP) chapter that provides strong and effective protection and enforcement of IP rights critical to driving innovation, creating economic growth, and supporting American jobs.

Key Achievement: Most Comprehensive Enforcement Provisions of Any Trade Agreement

For the first time, a trade agreement will require all of the following:

  • Enforcement authorities must be able to stop goods that are suspected of being pirated or counterfeited at all areas of entry and exit.
  • Enforcement against counterfeits and piracy occurring on a commercial scale.
  • Meaningful criminal procedures and penalties for camcording of movies.
  • Civil and criminal penalties for satellite and cable signal theft.
  • Broad protection against trade secret theft, including against state-owned enterprises.

Key Achievement: Strongest Standards for Trade Secrets of Any United States FTA

This deal, if finalized, will be the first FTA to require all of the following to protect United States rightsholders from theft of trade secrets, including by state-owned enterprises: civil remedies, criminal remedies, prohibition on impeding licensing of trade secrets, protections for trade secrets during the litigation process, and penalties for government officials who wrongfully disclose trade secrets. 

Key Highlights: Protections for Innovators

The new IP Chapter will:

  • Require full national treatment for copyright and related rights so United States creators are not deprived of rights in foreign markets that domestic creators receive.
  • Provide strong patent protection for innovators by enshrining patentability standards and patent office best practices to ensure that United States innovators, including small- and medium-sized businesses, are able to protect their inventions with patents. 
  • Include strong protection for pharmaceutical and agricultural innovators. 
  • Extend the minimum copyright term to 75 years for works like song performances and ensure that works such as digital music, movies, and books can be protected through current technologies such as technological protection measures and rights management information. 
  • Establish a notice-and-takedown system for copyright safe harbors for Internet service providers (ISPs) that provides protection for IP and predictability for legitimate technology enterprises who do not directly benefit from the infringement, consistent with United States law.
  • Provide important procedural safeguards for recognition of new geographical indications (GIs), including strong and comprehensive standards for protection against issuances of GIs that would prevent United States producers from using common names. 
  • Enhance provisions for protecting trademarks, including well-known marks, to help companies that have invested effort and resources into establishing goodwill for their brands. 
  • Includes 10 years of data protection for biologic drugs and expanded scope of products eligible for protection.

DIGITAL TRADE

The new Digital Trade chapter contains the strongest disciplines on digital trade of any international agreement, providing a firm foundation for the expansion of trade and investment in the innovative products and services where the United States has a competitive advantage. 

Key Highlights of the Digital Trade Chapter

The new Digital Trade chapter will:

  • Prohibit customs duties and other discriminatory measures from being applied to digital products distributed electronically (e-books, videos, music, software, games, etc.).
  • Ensure that suppliers are not restricted in their use of electronic authentication or electronic signatures, thereby facilitating digital transactions.
  • Guarantee that enforceable consumer protections, including for privacy and unsolicited communications, apply to the digital marketplace.
  • Limit governments’ ability to require disclosure of proprietary computer source code and algorithms, to better protect the competitiveness of digital suppliers.

DE MINIMIS

Key Achievement: Increased De Minimis Shipment Value Level

To facilitate greater cross-border trade, the United States has reached an agreement for Mexico to raise its de minimis shipment value level to $100 USD, up from $50 USD.  Shipment values up to this level would enter Mexico without customs duties or taxes, and with minimal formal entry procedures, making it easier for more businesses, especially small- and medium-sized ones, to be a part of cross-border trade.

Increasing the de minimis level with a key trading partner like Mexico is a critical outcome for United States small- and medium-sized enterprises (SMEs).  These SMEs often lack resources to pay customs duties and taxes, and bear the increased compliance costs that low, trade-restrictive de minimis levels place on lower-value shipments, which SMEs often have due to their smaller trade volumes.

New traders, just entering Mexico’s market, will also benefit from lower costs to reach consumers. United States express delivery carriers, who carry many low-value shipments for these traders, also stand to benefit through lower costs and improved efficiency. 

FINANCIAL SERVICES

United States financial services firms provide services critical to every sector of the economy, including small- and medium-sized businesses.  The United States exported about $115 billion in financial services in 2016, generating around a $41 billion surplus in trade in financial services. 

The updated Financial Services chapter includes commitments to liberalize financial services markets and facilitate a level playing field for United States financial institutions, investors and investments in financial institutions, and cross-border trade in financial services.

Key Achievement: Core Obligations to Prevent Discrimination Against Financial Services Suppliers

The chapter includes core obligations, such as:

  • National treatment, to ensure that a Party does not discriminate against United States financial service suppliers.
  • Market access, which prohibits a Party from imposing certain quantitative and numerical restrictions that would limit the business of United States financial services suppliers.
  • Most-favored nation treatment, to ensure that a Party does not discriminate in favor of another Party or non-Party.

Key Achievement: First Provision Against Unnecessary Local Data Storage Requirements

For the first time in any United States trade agreement, this deal includes a prohibition on local data storage requirements in circumstances where a financial regulator has the access to data that it needs to fulfill its regulatory and supervisory mandate. 

Key Highlights Supporting Financial Services

The new Financial Services chapter will include:

  • Updated provisions to allow for the cross-border transfer of data and updated market access obligation.
  • The most robust transparency obligations of any United States trade agreement, to ensure good regulatory practices in government licensing and other market access authorizations.
  • A separate annex on commitments relating to cross-border trade, including application of the national treatment and market access obligation to an expanded list of cross-border services, such as portfolio management, investment advice, and electronic payment services.

LABOR                                                                                                                                                          

One of President Trump’s principal objectives in the renegotiation is to ensure the agreement benefits American workers.  The United States and Mexico have agreed to a Labor chapter that brings labor obligations into the core of the agreement, makes them fully enforceable, and represents the strongest provisions of any trade agreement.

Key Achievement: Worker Representation in Collective Bargaining

The Labor chapter includes an Annex on Worker Representation in Collective Bargaining in Mexico, under which Mexico commits to specific legislative actions to provide for the effective recognition of the right to collective bargaining. 

Key Achievement: Labor Rights Recognized by the International Labor Organization

The Labor chapter requires the Parties to adopt and maintain in law and practice labor rights as recognized by the International Labor Organization, to effectively enforce their labor laws, and not to waive or derogate from their labor laws.

Additionally, the chapter includes new provisions to take measures to prohibit the importation of goods produced by forced labor, to address violence against workers exercising their labor rights, and to ensure that migrant workers are protected under labor laws. 

Key Achievement: New Labor Value Content Rule

To support North American jobs, the deal requires new trade rules of origin to drive higher wages by requiring that 40-45 percent of auto content be made by workers earning at least $16 USD per hour.

ENVIRONMENT

The United States and Mexico have agreed to the most advanced, most comprehensive, highest-standard chapter on the Environment of any trade agreement. Like the Labor chapter, the Environment chapter brings all environmental provisions into the core of agreement and makes them enforceable.

Key Achievement: Most Comprehensive Set of Enforceable Environmental Obligations

The Environment chapter includes the most comprehensive set of enforceable environmental obligations of any previous United States agreement, including obligations to combat trafficking in wildlife, timber, and fish; to strengthen law enforcement networks to stem such trafficking; and to address pressing environmental issues such as air quality and marine litter

Environment obligations include:

  • Prohibitions on some of the most harmful fisheries subsidies, such as those that benefit vessels or operators involved in illegal, unreported, and unregulated (IUU) fishing. 
  • New protections for marine species like whales and sea turtles, including a prohibition on shark-finning and commitment to work together to protect marine habitat. 
  • Obligations to enhance the effectiveness of customs inspections of shipments containing wild fauna and flora at ports of entry, and ensure strong enforcement to combat IUU fishing.
  • First-ever articles to improve air quality, prevent and reduce marine litter, support sustainable forest management, and ensure appropriate procedures for environmental impact assessments. 
  • Robust and modernized mechanisms for public participation and environmental cooperation.

Published by the U.S. Chamber of Commerce at https://www.uschamber.com/tariffs?iesrc=ctr

The administration’s new tariffs threaten to spark a global trade war.

China, the EU, Mexico and Canada have already retaliated or announced plans to retaliate with billions of dollars in tariffs on American-made products.

Tariffs imposed by the United States are nothing more than a tax increase on American consumers and businesses–including manufacturers, farmers, and technology companies–who will all pay more for commonly used products and materials.

Retaliatory tariffs imposed by other countries on U.S. exports will make American-made goods more expensive, resulting in lost sales and ultimately lost jobs here at home.

This is the wrong approach, and it threatens to derail our nation’s recent economic resurgence.

Send a Message to Congress

New tariffs on steel, aluminum, and Chinese imports, as well as the potential for additional tariffs on autos and auto parts, have pushed us to the brink of a global trade war. Canada, Mexico, the EU, and China have already retaliated—or announced plans to retaliate—with billions of dollars in tariffs on American-made products.

Millions of U.S. jobs depend on America’s ability to trade with other countries. Half of all U.S. manufacturing jobs depend on exports, and one in three acres of American farmland is planted for international sales. But recent and proposed trade actions by the Trump administration threaten as many as 2.6 million American jobs and will stymie our economic resurgence. 

Imposing tariffs on imported goods will hit American consumers and businesses—including manufacturers, farmers, ranchers, and technology companies—with higher costs on commonly used products and materials.

Simply put, tariffs are a tax on American consumers and businesses. Tariffs are the wrong approach to address unfair trade practices.

For a map to learn how each state is threatened by this emerging trade war and to send a message to congress, please visit: https://www.uschamber.com/tariffs?iesrc=ctr

FOR IMMEDIATE RELEASE                                                                           

July 6, 2018

Contact: USTR Public & Media Affairs

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Washington, DC– The Office of the U.S. Trade Representative (USTR) today announced a process to obtain product exclusions from the additional tariffs in effect on certain products imported from China under the U.S. response to China’s unfair trade practices related to the forced transfer of U.S. technology and intellectual property.

Today, additional tariffs of 25 percent come into effect for Chinese products imported under 818 tariff lines, covering a trade value of approximately $34 billion in 2018. These tariff lines contain products identified as benefiting from China’s industrial policies, including the “Made in China 2025” program. The list of products subject to tariffs was determined by a 90-day process that included public hearings and a notice and comment period.

USTR is providing an opportunity for the public to request exclusion of a particular product from the additional duties to address situations that warrant excluding a particular product within a subheading, but not the tariff subheading as a whole.

A Federal Register notice outlining the criteria and process for a product exclusion request will be published, and public requests, responses, and replies will be received via Regulations.gov. In making its determination on each request, USTR may consider whether a product is available from a source outside of China, whether the additional duties would cause severe economic harm to the requestor or other U.S. interests, and whether the particular product is strategically important or related to Chinese industrial programs including “Made in China 2025”.

The exclusion process has the following important dates and features:

  • The public will have 90 days to file a request for a product exclusion; the request period will end on October 9, 2018.
  • Following public posting of the filed request on Regulations.gov, the public will have 14 days to file responses to the request for product exclusion.  After the close of the 14 day response period, interested persons will have an additional 7 days to reply to any responses received in support of or opposition to the request.
  • Exclusions will be effective forone year upon the publication of the exclusion determination in the Federal Register, and will apply retroactively to July 6, 2018.

Because exclusions will be made on a product basis, a particular exclusion will apply to all imports of the product, regardless of whether the importer filed a request. U.S. Customs and Border Protection will apply the tariff exclusions based on the product.

The tariff action on China is part of USTR’s Section 301 investigation and follows President Trump’s announcement in March that the United States would impose tariffs on Chinese imports and take other actions in response to China’s policies that coerce American companies into transferring their technology and intellectual property to Chinese enterprises. These policies bolster China’s stated intention of seizing economic leadership in advanced technology as set forth in its industrial plans, such as “Made in China 2025.”

The text of the Federal Register notice can be viewed here. Formal publication of the Federal Register notice will occur next week. 

Published at Reuters.com on May 25, 2018. Reporting by Julia Fioretti

BRUSSELS (Reuters) - New European privacy regulations went into effect on Friday that will force companies to be more attentive to how they handle customer data.

The ramifications were visible from day one, with major U.S.-media outlets including the LA Times and Chicago Tribune were forced to shutter their websites in parts of Europe.

People in the bloc have been bombarded with dozens of emails asking for their consent to keep processing their data, and a privacy activist wasted no time in taking action against U.S. tech giants for allegedly acting illegally by forcing users to accept intrusive terms of service or lose access.

“You have to have a ‘yes or no’ option,” Austrian Max Schrems said before filing complaints in European jurisdictions. “A lot of these companies now force you to consent to the new privacy policy, which is totally against the law.”

The European Union General Data Protection Regulation (GDPR) replaces the bloc’s patchwork of rules dating back to 1995 and heralds an era where breaking privacy laws can result in fines of up to 4 percent of global revenue or 20 million euros ($23.5 million), whichever is higher, as opposed to a few hundred thousand euros.

European privacy regulators signalled that they were ready to flex their muscles but were not “sanctioning machines”.

“This (forced consent) is an issue that we will be looking at immediately, and work is already underway,” said Helen Dixon, head of the Irish Data Protection Commissioner, which will be responsible for policing U.S. giants Facebook (FB.O) and Google (GOOGL.O), among others.

Many privacy advocates have hailed the new law as a model for personal data protection in the internet era and called on other countries to follow the European model.

Critics say the new rules are overly burdensome, especially for small businesses, while advertisers and publishers worry it will make it harder for them to find customers.

The GDPR clarifies and strengthens existing individual rights, such as the right to have one’s data erased and the right to ask a company for a copy of one’s data.

But it also includes entirely new mandates, such as the right to transfer data from one service provider to another and the right to restrict companies from using personal data.

“It’s a gradual and not a revolutionary kind of thing ... However for many companies it was a huge wakeup call because they never did their homework. They never took the data protection directive seriously,” said Patrick Van Eecke, partner at law firm DLA Piper.

Activists are already planning to use the right to access their data to turn the tables on internet platforms whose model relies on processing people’s personal information.

That means companies have had to put in place processes for dealing with such requests and educating their workforce because any non-compliance could lead to stiff sanctions.

Studies suggest that many companies are not ready for the new rules. The International Association of Privacy Professionals found that only 40 percent of companies affected by the GDPR expected to be fully compliant by May 25.

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DATA PORTABILITY
It is unclear how many provisions of GDPR will be interpreted and enforced. European regulatory authorities, many of whom say they are under-funded, will oversee the new law, with a central body to resolve conflicts.

One key provision of GDPR, the right to data portability, is causing particular confusion.

“I think the data portability rights are pretty significant and are going to take a while for people to figure out what the bounds of them are and how to go about complying with them,” said David Hoffman, associate general counsel and global privacy officer at Intel.

For example, music streaming services such as Spotify create playlists for users based on their music preferences. While a user seeking to exercise the data portability right would be able to move playlists he or she created, the situation becomes fuzzy if the playlists are created by the streaming service using algorithms.

EU data protection authorities said individuals should be able to transfer data provided by them but not “derived data” created by the service provider such as algorithmic results.

“It’s not obvious that you can necessarily migrate the data from your system to somebody else’s system,” Tanguy Van Overstraeten, of Linklaters, said.

On the business side, companies are rushing to renegotiate contracts with suppliers and service providers because GDPR increases their liability if something goes wrong.

Data processors which only process or store the data on behalf of their clients, for example cloud computing providers, will be directly liable for sanctions and could face lawsuits from individuals, and that needs to be reflected in contracts.

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