104 Act of 1974, the United States implemented a generalized system of preferences involving numerous beneficiary developing countries. Currently, the United States accords preferential tariff treatment to only one industrialized country--Canada. Automotive Products Trade Act of 1965 Article II(b) of the agreement committed the Government of the United States to seek enactment of legislation implementing the agreement, during the session of the United States Congress commencing on January 4, 1965. In seeking such legislation the Government of the United States was also to seek authority permitting the implementation of such duty-free treatment retroactively to the earliest date administratively possible following the date upon which the Government of Canada had accorded duty-free treatment. 1/ Pursuant to article II(b) of the agreement, President Johnson submitted to the Congress proposed legislation that would implement the agreement. Hearings were held before the Ways and Means Committee of the House of Representatives in April of 1965, and before the Committee on Finance of the Senate in September of 1965. The Automotive Products Trade Act of 1965 was passed by the Congress in October of 1965; it was signed by the President on October 21, 1965. The act itself contains five titles. 2/ Title I established the short title of the act, set forth its basic objectives, which were to authorize the implementation of the agreement in order to strengthen 1/ See appendix E of this report. 2/ For the text of the act see appendix K of this report. 105 97 economic relations and expand trade in automotive products between the United States and Canada. and authorized the implementation of similar agreements with other countries. Title II of the act authorized the President to proclaim modifications of the tariff schedules to implement the agreement. of the act. However the great bulk of the modifications to be made were set out in title IV The President was also given authority, pursuant to a specified procedure, to implement similar agreements with other countries, but this authority expired, pursuant to the provisions of the act, the day after the date of enactment of the act. The President was also authorized to give retroactive effect to any proclamation implementing the agreement as of the earliest date after January 17. 1965, and to terminate any proclamation implementing the agreement or any similar agreement made pursuant to the provisions of title II of the act. The act also required the President to submit to the Congress a special report on the comprehensive review called for by article IV(c) of the agreement and to report the existence and terms of any additional commitments that the President finds have been made by any manufacturers to the Canadian Government. The reports were to include any recommendations necessary for the achievement of the purposes of the agreement and the act. Title III of the act provided that a petition may be filed for tariff adjustment or adjustment assistance under the Trade Expansion Act of 1962, 19 U.S.C. 1901-1991, as though the reduction of duty proclaimed by the President under the agreement and the Automotive Products Trade Act of 1965 were a concession granted under a trade agreement referred to in 106 98 section 301 of the Trade Expansion Act of 1962. Special authority was provided under the Automotive Products Trade Act of 1965 for the President to determine eligibility to apply for adjustment assistance during the "transitional period ending in July 1968, with special criteria for making such a determination. Title II of the Automotive Products Trade Act of 1965 provided for the bulk of the modifications of the tariff schedules which the President was authorized to proclaim in implementing the agreement. The act provided for the definitions of "Canadian article" and "original motor-vehicle equipment" as provided in annex B of the agreement. Title V of the act involved general provisions which included a requirement that the President submit annual reports to the Congress on the operation of the agreement and a provision providing that the act should not be contrued to affect or modify the provisions of the Antidumping Act of 1921, 19 U.S.C. 160-173, or of any of the antitrust laws as designated in 15 U.S.C. 12 The President signed Proclamation 3682, Implementing the Agreement Concerning Automotive Products between the United States and Canada on October 21, 1965, which was to enter into force on December 20, 1965, and be retroactive to January 18, 1965. In addition, the President signed, on the same day, Executive Order 11254. Establishing the Automotive Agreement Adjustment Assistance Board. United States GATT waiver The United States appeared before the Working Party which had been formed by the Contracting Parties of the GATT to study the agreement, 107 in November 1965 to request a waiver under article XXV(5) of the GATT of its most-favored-nation obligations, admitting that the agreement constituted a violation of the GATT. The waiver was granted unanimously, with the United States agreeing to enter into consultations with any Contracting Party that claimed the agreement threatened to create or created a significant diversion of imports from that Contracting Party. 108 100 CERTAIN ADMINISTRATIVE MATTERS PERTAINING TO The United States-Canadian automotive agreement was signed on January 16. 1965, and the Government of Canada implemented its conditional duty-free treatment on imports of automotive products as specified in the agreement on the same day. While duty-free treatment on imports of automotive products as specified in the agreement could not be implemented as quickly in the United States, the Government of the United States had agreed in Article II(b) 1/ of the agreement that. in seeking legislation implementing such duty-free treatment, it would seek authority permitting the implementation of such duty-free treatment retroactively to the earliest date administratively possible following the date upon which the Government of Canada had accorded duty-free treatment. The United States Customs Service continued to collect import duties on imports of Canadian motor vehicles and original-equipment parts therefor following the signing of the agreement, but it suspended the liquidation of such entries which permitted the collected duties to be refunded upon the passage of the Automotive Products Trade Act of 1965. United States Antidumping and Countervailing Duty Actions by the two Governments in the agreement should not preclude action by 17 See appendix E of this report. |