[CTC] Administration Faces April 3 Deadline For Submission Of TPP Legal Changes

[Arthur Stamoulis]

Possible procedural routes for a TPP vote this year; not necessarily an exhaustive list...
Administration Faces April 3 Deadline For Submission Of TPP Legal Changes

Inside US Trade; March 29, 2016 
The Obama administration is facing an April 3 deadline to submit to Congress a description of the changes that will be required to U.S. law in order to implement the Trans-Pacific Partnership agreement, which is one of several outstanding procedural steps required under the 2015 fast track law that are listed below.

This list of changes would lay the groundwork for the administration and Congress to work together in drafting an implementing bill for trade agreements subject to fast track.

Specifically, the requirement laid out in Section 106(a)(1)(c) is that “within 60 days after entering into the agreement, the President submits to Congress a description of those changes to existing laws that the President considers would be required in order to bring the United States into compliance with the agreement.” The TPP was signed on Feb. 3 U.S. time.

The fast-track law does not explicitly require this document to be made public, as it does for some other documents it requires for free trade agreements. But a congressional source said he expects the document to be made public.

The Office of the U.S. Trade Representative did not respond by press time to a question on whether it planned to publish the description of legal changes required under TPP.

One issue that is sure to be addressed in the document is the Obama administration's plan <http://insidetrade.com/node/153018> to restructure the main U.S. customs user fee -- the merchandise processing fee (MPF) -- in order to comply with the TPP's obligation that it not be applied on an ad valorem basis. This change must be made through legislation, and is expected to be addressed as part of the TPP implementing bill.

The April 3 submission and other procedural steps would prepare the groundwork for a potential lame-duck vote on TPP, which at this point is not certain for a number of reasons, including the outcome of the presidential and congressional elections.

Apart from the steps required under fast track, the administration is also working politically to appease the congressional critics who have flagged various problems with TPP, including a market exclusivity period for biologics that they view as too short.

International Trade Commission Report: The only other outstanding requirement under fast track for which there is a set date is for the ITC to conclude its economic assessment of the TPP agreement within 105 days of signature. This would be May 18, and the ITC has said it expects to deliver the report on that date.

After that, the timing depends on when the administration formally submits the draft TPP implementing bill to Congress. The administration has indicated it will work with Congress to determine the most appropriate time for congressional consideration of TPP, which at this point seems to be after the November election.

30-Day Deadline: Thirty days prior to formal submission of the draft TPP implementing bill, the president must submit to Congress a copy of the final legal text of the agreement; a draft statement of administrative action (SAA) proposed to implement the agreement; and a plan for implementing and enforcing the agreement.

At the same time, he must also submit to the House Ways & Means and Senate Finance committees three reports that spell out how the deal will impact U.S. employment, labor rights in the U.S. and FTA partners, and the environment. USTR has said these reports will promptly be made available to the public “to the maximum extent possible.”

Mock Markups: Historically, prior to formal submission of the draft implementing bill, Ways & Means and Finance have held so-called “mock markups” where they consider a preliminary version of the draft implementing bill. During these sessions, members can consider amendments to the preliminary version of the implementing bill, although any amendments approved are not directly binding on the administration.

The mock markup process is not required under the 2015 fast-track legislation, although both the Finance and Ways & Means reports accompanying the bill indicate their preference for having them on future FTA implementing bills. The reports do not explicitly lay out a timetable for when the mock markups would take place, although the Ways & Means report implies that it intends to hold its mock markup after the president submits the final legal text and draft SAA but before he formally submits the draft implementing bill.

It does so by saying that the 30-day advance submission of the final legal text and draft SAA “is intended to provide the Committee with the information necessary to conduct its mock-mark-up. It also allows Congress as a whole to review the materials with adequate time before the implementing bill is transmitted for consideration pursuant

to this bill.”

Formal Submission: After the mock markups take place, the president during a day in which both chambers are in session must formally submit the draft TPP implementing bill with three additional documents. These include another copy of the final legal text of the agreement, as well as the final SAA.

The fourth document is known in the law as “supporting information” and consists of two elements. The first is an “explanation as to how the implementing bill and proposed administrative action will change or affect existing law."

The second element is a statement that itself consists of two parts. The first part asserts “that the agreement makes progress in achieving the applicable purposes, policies, priorities, and objectives” of the fast-track law.

The second part sets forth the reasons of the president regarding how and to what extent the agreement makes progress in achieving the applicable purposes, policies, and objectives of the fast-track law; whether and how the agreement changes provisions of an agreement previously negotiated; how the agreement serves the interests of United States commerce; and how the implementing bill meets the fast-track standards, including that it only contain such provisions that are “strictly necessary or appropriate” to implement a trade agreement.

TPP Consideration: Once the implementing bill is introduced, Congress has up to 90 legislative days to consider it. Specifically, the Ways & Means Committee must act by the 45th legislative day or the bill is automatically discharged. A full House vote on passage must happen by the end of the 15th legislative day after that.

Senate Finance has until the later of the 45th day of session after the Senate bill is introduced or the 15th day of session after the Senate receives the House bill. After the bill is discharged from Finance, a full Senate vote must take place by the end of the 15th legislative day after the bill is discharged.

Based on the House legislative calendar circulated by House Majority Leader Kevin McCarthy (R-CA), the Obama administration has already missed the date by which it would need to submit a TPP implementing bill in order to guarantee a vote by the end of the lame-duck session of Congress. That would Feb. 26, which is 90 legislative days before Dec. 16, the last day Congress is scheduled to be in session in 2016.

Similarly, May 18 is the day which the Obama administration would need to submit the TPP implementing bill if it wanted to lock in a House vote on the legislation, as that is 60 legislative days prior to the end of the session.

But a vote is still possible during the lame duck because the fast-track bill only sets out the maximum number of days for consideration; an implementing bill could move much faster if the congressional leadership makes it a priority.

McCarthy's calendar states that the post-election schedule is subject to change, and some sources have held open the possible that there may not even be a lame-duck session at all.
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