Section 301

Section 301 in Global Commerce Policy

In this regard, a definition of this issue is as follows: the section so numbered of the United States Trade Act of 1974. The entries on trade policy are here. It was amended in 1979 (Trade Agreements Act), 1984 (Trade and Tariff Act), 1988 (Omnibus Trade and Competitiveness Act) and 1994 (Uruguay Round Agreements Act). Section 301 is designed to enforce United States rights under trade agreements and to provide for responses to foreign unfair trading practices following petition and investigation. The entries on trade policy in the Encyclopedia are here. Unfair trading practices may take place in the United States, in the offending country itself or in third countries. Section 301 may also be used to obtain increased market access for United States goods and services, to secure fairer conditions for its investors abroad and to promote more effective protection in other countries for United States intellectual property rights. The entries on trade policy are here. It also allows USTR to limit imports from countries that unfairly restrict United States trade in particular products. The entries on trade policy are here. It is generally used for single product sectors. Section 301 had its origin in Section 252 of the Trade Expansion Act of 1962 which gave the President broad authority to retaliate against unjustifiable agricultural barriers, and lesser authority to deal with other trade barriers. Section 252 was only used twice, once during the Chicken War which marked the beginning of the Kennedy Round. When it became Section 301 of the Trade Act of 1974, it eliminated the distinction between agricultural and non-agricultural products, and it also covered services associated with international trade. The Trade Agreements Act of 1979 set out that the President should use his authority to enforce trade agreements. The entries on trade policy in the Encyclopedia are here. Under the earlier versions of Section 301, USTR could initiate investigations and recommend appropriate action to the President. The passing of the Omnibus Trade and Competitiveness Act of 1988 transferred authority to retaliate from the President to USTR, subject to any presidential direction. Retaliation now became mandatory in principle, but considerable scope for discretion remained. The threat of a Section 301 action is most unwelcome to trade policy makers, not only because it may mean rethinking the rules in the targeted areas, but also because the defence requires much effort that is otherwise unproductive. Taking action is equally resource-intensive for the Americans, and USTR tends to pick cases it perceives as winnable to the extent that it has the choice. That flexibility has been eroded over the years. Some say that the history of Section 301 actions against the European Economic Community, Japan and Korea has shown that its imposition can be quite ineffectual if there is not already an inclination in the target country to reform access to the sector anyway. This is definitely an underestimate of its impact. The entries on trade policy in the Encyclopedia are here. Others say that the WTO understanding on dispute settlement has taken the teeth out of Section 301. This is not the case. Section 301 is still available for retaliation if a WTO member does not act in accordance with the outcome of the dispute settlement process. Section 301 may also still be used as originally intended in all cases where there are no WTO rules covering an action perceived as unfair. See also Special 301, Super 301 and United States Omnibus Trade and Competitiveness Act.[1]

Section 301in the wold Encyclopedia

For an introductory overview on international trade policy, see this entry.

Resources

Notes and References

1. Dictionary of Trade Policy, “Section 301” entry (OAS)

See Also