As we noted in a Counsel’s Report ALERT dated February 11, Ecuador is pressing the U.S. Government for preferential market access for its exports of canned tuna to this country during the ongoing negotiations for an Andean Free Trade Agreement (FTA). Ecuador notes that as a result of the North American Free Trade Agreement (NAFTA), the U.S. duty on imports of canned tuna in water from Mexico was reduced from 12.5 percent to 3.3 percent for “over-quota” imports, and from 6 percent to 1.6 percent for “under-quota” imports of the product (the duty rate on imports of canned tuna in oil from Mexico was reduced from 35 percent to 9.3 percent). Ecuador argues that as part of a U.S.-Andean FTA, Ecuador should be granted market access (i.e., tariff) treatment that is at least equal to, if not better than, the market access treatment granted to Mexico. Members may recall that as part of the Trade Act of 2002 which included an extension of the Andean Trade Preference Act (ATPA), imports of prepared or preserved tuna in water in flexible or foil containers from ATPA beneficiaries, including Ecuador, were allowed duty-free treatment so long as certain other criteria were met (e.g., the tuna must be harvested by United States vessels or vessels of the Andean beneficiary countries). However, the ATPA did not provide preferential market access terms for imports of canned tuna in water.
As noted in a Counsel’s Report ALERT dated January 21, the Thai Government is also making concerted attempts to obtain favorable market access treatment for its exports of canned tuna to the U.S., both within the context of the ongoing FTA negotiations with that country and also as a plea for assistance in the wake of the December tsunami. The ATPA provision for imports of “pouched” tuna has caused Thailand – traditionally one of the largest foreign suppliers of canned tuna to the U.S. – to lose market share in this country.
In the most recent development, a bill was introduced in the U.S. senate last week by Senators Kennedy and Kerry (D-MA) that would provide duty-free treatment for imports of preserved tuna in pouches from member nations of the Association of Southeast Asian nations (ASEAN), which includes Thailand, Indonesia, Philippines, Malaysia, Singapore and Vietnam. The bill would cap such duty-free treatment tin a particular calendar year to the aggregate amount of duty-free pouched tuna that entered the U.S. from ATPA beneficiary countries in the previous calendar year. This provision would remain in effect through the end of 2008.
The bill, S. 5999, entitled the “Fair Trade in Pouch Tuna Act of 2005,” is currently before the Senate Finance Committee.
As noted in prior ALERTS, the confluence of events regarding imports of preserved tuna from ATPA and ASEAN nations constitute the best opportunities to effect favorable changes to U.S. duty treatment of this product.
The Association will work with relevant Members to determine a political action program to move forward on these fronts.
