Congressional trade committee leaders submitted comments for the ITC to consider in its final Miscellaneous Tariff Bill report due for release in August. House Ways and Means Chairman Kevin Brady and Raking Member Richard Neal, along with Senate Finance Chairman Orrin Hatch and Ranking Member Ron Wyden, offered comments based on a review of the ITC’s June-issued preliminary MTB report, which evaluated the eligibility of some 2,500 petitions submitted by U.S. companies seeking duty savings on imported products not made in the United States in accordance with a new process established by the American Manufacturing and Competitiveness Act of 2016.
Under the new process, the House Ways and Means and Senate Finance Committees may provide additional information to the ITC for purposes of moving petitions listed in Category VI of the preliminary report (petitions not recommended for inclusion) into another category in the final report, increasing chances of inclusion in final legislation. The trade committee Members did not comment on specific MTB petitions, but offered over-arching comments on how the ITC should address issues related to domestic availability – a key eligibility criterion. Take-away points included:
- Domestic Production Claims. Specific evidence is necessary to support claims that domestic production exists. “Blanket assertions” without supporting evidence demonstrating domestic production should be “deemed insufficient.”
- Imminent Production. Claims of “imminent production” must be based on more than a claim that “production is theoretically possible” and should include evidence that production is planned within three years of the petition filing.
- Inconsistent “Identical, Like or Directly Competitive” Determinations. The ITC, and not the Department of Commerce, has the final say in rendering “identical, like, or directly competitive” article determinations in the preliminary and final reports. Where the Department of Commerce reaches an inconsistent determination, the ITC must consider Commerce’s findings, but the ITC must also conduct its own analysis and “should not automatically substitute another agency’s conclusions for its own.”
Trade committee Members also expressed appreciation of the ITC’s addressing concerns related to transparency and the opportunity for meaningful comment by re-opening the MTB portal for a period of time after releasing the preliminary report to allow petitioners to address domestic objections and provide additional information in advance of the final report.
The Congressional comments mark another important milestone in the first-go of the new MTB process. Once the ITC issues its final report next month, the new law provides that Congress should act within 90 days to consider a bill that would provide duty relief to qualifying petitions through 2019. This timing puts the MTB into the fall, where it appears Congress will be focused on much of its legislating for the year. Stay tuned for further developments.