Senate Finance Committee Holds 'Mock' Markup Of Peru FTA

by Leroy Baker, Tax-News.com, New York

21 September 2007

The Senate Finance Committee on Thursday held a 'mock' markup of the draft implementing bill for the Peru Free Trade Agreement.

The agreement is the first trade agreement that incorporates the environmental and labor requirements of the landmark bipartisan trade deal struck between Congress and the administration in May of this year. The implementing bill approves the Peru Free Trade Agreement and implements its customs, procurement, illegal logging, and other provisions.

“For the first time in any free trade agreement, this pact includes significant and fully enforceable labor and environmental protections. That is something we can all be very proud of,” commented Finance Committee Chairman Max Baucus. “Many people in both this country and in Peru will benefit from these long-awaited achievements, and it is my hope that this agreement will help to move America’s trade agenda forward.”

The Finance Committee held a mock markup of an earlier version of the Peru Free Trade Agreement in July 2006, but the agreement has been revised since then to incorporate the labor, environmental, and other provisions of the bipartisan trade deal negotiated in May. The Committee held a hearing earlier this month to examine these new provisions.

Among other things, the implementing bill:

• Approves the Peru Free Trade Agreement and establishes the necessary conditions for its entry into force;
• Authorizes the President to proclaim tariff modifications;
• Defines which goods are eligible for preferential treatment under the agreement;
• Implements the agreement’s safeguard mechanisms to address import surges of agricultural, textile, apparel, and other imports;
• Gives eligible Peruvian goods and services access to US government procurement bidding procedures;
• Implements the verification and compliance measures included in the new illegal logging annex that was added to the agreement as a result of the May 10 bipartisan trade deal;
• Requires the United States Trade Representative to provide a report to Congress within one year after entry into force of the agreement, two years after entry into force, and periodically thereafter, on the steps the United States and Peru have taken to implement the illegal logging annex, and the Environmental Cooperation Agreement that the United States and Peru negotiated concurrently with the agreement.

The Finance Committee considers the draft implementing bill during a "mock" markup, because Congress cannot offer amendments to the final implementing bill submitted by the administration under the Trade Promotion Authority Act - also known as "fast track" - procedures. Committee mock markups are the only opportunities for Congress to offer amendments to the administration’s proposal. Following administration review of any amendments that the Finance and House Ways and Means Committees approve on the draft implementing bill, a final version of the implementing bill will be submitted to Congress for an up-or-down vote.

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