At the time this article was
written Raymond Aheane and Francis Miko were trade and international relations
specialists with the Congressional Research Service of the Library of Congress
When President Reagan notified
Congress shortly before midnight on October 3, 1987 of his intent to enter into
a free trade agreement (FTA) with Canada, he was fulfilling one of many
requirements set forth in sections 102 and 151 of the 1974 Trade Act (P.L.
93-619), as amended by the Trade Agreements Act of 1979 (P.L. 96-39) and the
Trade and Tariff Act of 1984 (P.L. 98-573). The key elements of U.S. law as
they affect congressional-executive branch consultations, the introduction of
implementing legislation, and floor procedures for the consideration of the FTA
are as follows:
The President must notify the House
of Representatives and the Senate of his intention to enter a trade agreement
not less than 90 days before doing so. Since the President's authority to have
agreements considered under special legislative procedures expires on January
2, 1988 at midnight: October 3, 1987 was the latest day by which the President
could have notified Congress of his intent to enter into a trade agreement with
During the October 3, 1987-January
2, 1988 90-day period, and prior to concluding the agreement, the
Administration is required to consult about the agreement and its
implementation with the House Ways and Means Committee and the Senate Finance
Committee and with every other congressional committee having jurisdiction over
matters affected by the agreement. The law does not specify the nature of the
consultative process, but the legislative history of the 1974 Trade Act
indicates the period was intended to provide Congress an opportunity to
register its reactions to the agreement and to recommend modifications before
it is entered into.1
After signing the agreement, the
President must submit the text to the Senate and House of Representatives,
proposing a bill approving the agreement together with changes in United States
law necessary or appropriate to implement it. In addition, the administration
must submit a statement of any administrative actions proposed to implement the
agreement and a statement of reasons why the agreement serves the interests of
U.S. commerce. The law does not specify any time frame for the submission of
this implementing legislation.
Special procedural rules involving
time limits, discharge petitions, limitations on debates and a prohibition of
amendments govern congressional consideration of the implementing bill. These
so-called "fast-track" procedures are intended to assure that trade
agreements negotiated by the Executive would be given an up-or-down vote by the
Congress within a definite time-frame.
In considering the Canadian
agreement, Congress will have at the maximum 90 working days following
submission of the package to take an up-or-down vote. In both chambers, each
committee to which the bill was referred is given up to 45 days to report the
measure out. Committees which fail to report out within the 45 days will be
automatically discharged, and the bill will be placed on the appropriate
Each chamber votes on the bill
within 15 working days after the measure has been received from the committees.
A simple majority in each chamber is required for approval.
While these procedures appear
straight-forward, it remains in early December uncertain how the implementing
legislation will be drafted, when the agreement and legislation will be
submitted to Congress, and whether the "fast-track" procedures will
be modified. Answers to these questions will depend on numerous political
factors, including the state of executive-congressional relations and the congressional
calendar. Key decisions that affect the consideration of the Canada- U.S. FTA
can be viewed as part of the larger trade policy process in which Congress and
the President share power.
It is important to remember that
the United States Constitution grants Congress sole power "to regulate
commerce with foreign nations" and "to lay and collect duties."
The role of the President in trade policy stems from his constitutional power
to "conduct foreign relations," to negotiate international agreements
on behalf of the United States, and from powers delegated by the Congress. This
division of responsibility necessitates a close working partnership between the
executive and legislative branches of government on foreign trade matters. From
1934 until the Tokyo Round of multilateral trade negotiations held in the 1970s
(an era when tariffs were the central trade issue) the framework for
executive-legislative branch cooperation was clear-cut. During this period
Congress provided the President advance authority to cut or raise tariffs
within well-defined limits and to implement the agreements without further
The Tokyo Round of negotiations,
with its emphasis on non-tariff barriers, posed new obstacles to cooperation.
Non-tariff barriers such as subsidies, technical standards, and discriminatory
procurement policies, affect domestic laws in numerous ways. Agreements
bringing greater discipline over non tariff barriers require changes in
domestic laws that are difficult to predict in advance of the actual
To provide U.S. negotiators with
credibility that agreements struck with foreign governments would have a high
probability of being implemented by Congress, a new framework to bridge
executive-legislative constitutional responsibilities was developed in the
Trade Act of 1974. In return for congressional acceptance of the
"fast-track" approval procedures for these types of agreements, the
executive branch was expected to keep Congress informed of the progress of the
agreement throughout the stages of negotiation and implementation.
As the final package of Tokyo Round
agreements began to take shape in early 1978, key members of the executive
branch and the Congress addressed the issue of how the required consultations on
the substance of implementing legislation were to be conducted. An account of
this episode by I.M. Destler and Thomas R. Graham bears repeating:
As the final package of agreements
began to take shape in Geneva╝ it was clear that if the responsible committees
were to influence the negotiations and implementation, they would have to do so
before non-amendable legislation was formally submitted. Reciprocally, the
Administration needed close collaboration with the committees in shaping the
legislation, in order to assure their strong endorsement. If, instead, the
Congressional committees were sharply dIvided, the inflexibility of the process
would become a disadvantage; and the floor votes could be negative. The nature
of trade politics seemed to increase this risk, for if the industries that were
affected by imports saw a real prospect of defeating the implementing
legislation, they might join together to do so, rather than each seeking
separately its own accommodation. Yet the Trade Act offered little guidance on
how such consultations should take place, other than the point that
consultations should be comprehensive in scope.2
The arrangement agreed to for the
Tokyo Round 90-day consultation period (which is equivalent to the October 3,
1987 - January 2, 1988 consultation period for the Canadian agreement) was a
series of "informal" mark-up sessions. President Carter submitted the
formal 90-day notification on January 4, 1979, and the relevant committees met
in mostly closed sessions over the next four months to evaluate the agreements
and make legislative recommendations. An implementing bill was, in turn,
drafted mostly by Congress and released for public comment in early June.
Following this extensive process,
President Carter on June 19, 1979 formally proposed the implementing
legislation to Congress for consideration. Less than five weeks later, both the
House of Representatives and the Senate overwhelmingly approved the agreements.
The closed and informal mark-up
sessions during the official 90-day notification period of the Tokyo Round
provided Congress with the opportunity to react to the agreements and recommend
modifications before they were entered into. This process has not been
duplicated to date for the Canadian agreement.
An important reason is that the
final text of the free trade agreement is still being negotiated. In the Tokyo
Round notification period, texts of the agreements were classified but made
available to congressional committees. Although the relevant committees have
been briefed by administration officials on the elements of the agreement, the
lack of a final text until mid December makes it nearly impossible to formulate
legislation that will implement the agreement.
Although a final text became
available just before Congress adjourned for Christmas, many members of the
lead trade committees have been absorbed in the budget reduction negotiations
and legislation. They will need time to examine the provisions on the trade
bill. Priority attached to reducing the budget deficit also has contributed to
delays on final consideration of H.R. 3, the omnibus trade bill, whose passage
is a legislative priority of the Democratic leadership of both chambers.
Decisions on how and when the implementing legislation for the Canadian
agreement will be drafted have to be made before the President formally submits
the bill to Congress. Whether the Reagan Administration will still follow in
modified form the example set in the Tokyo Round, allowing a large
congressional role in drafting the implementing legislation, remains to be
seen. Given the heavy demands of the congressional calendar, if Congress does
play a large role in drafting the implementing legislation, a bill is unlikely
to be ready for submission until March or April 1988. In this case, a final
vote might not occur until summer or early fall when the 1988 election cycle is
in full swing.
Some officials in the Reagan
Administration would prefer an earlier vote in an attempt to prevent the
Presidential and congressional election campaigns from playing a possible role
in the final vote. The executive branch presumably could develop implementing
legislation on its own for submission in January or early February. Under this
scenario, final consideration could occur as early as May or June of 1988.
A final uncertainty relates to the
expedited procedures governing consideration of the implementing legislation.
As explained above, special "fast-track" procedures involving time
limits, limitations on debate and prohibitions on amendments provide the bill
with a favorable status, increasing the chances of approval.
These expedited and
"fast-track" procedures, however, can be changed. The Trade Act of
1974 (section 151 (a) expressly recognizes the constitutional right of each
chamber to change its rules of procedure at any time. The mechanism in each
chamber would vary. In the House of Representatives, the House Rules Committee
could issue a special rule to make one or more amendments in order. In the
Senate, attempts to change the expedited procedures would likely require
unanimous consent. The Senate Rules Committee already has reported out a
resolution that would allow amendments to the maritime provisions of the
implementing bill. But the Senate Finance Committee, which has primary
jurisdiction over the FTA, has placed a hold on the resolution making it
extremely difficult to bring the resolution to the floor.
In the event either chamber altered
the fast-track procedures, it is hard to predict what the effect would be.
Clearly, much would depend on the nature of the amendment and whether its
practical effect contradicted the letter or spirit of the FTA text.
1. U.S. Congress. House Committee
on Ways and Means. H.Rpt. No. 93-571, to accompany H.R. 10710, October 10,
2. I.M. Destler and Thomas R.
Graham. "United States Congress and the Tokyo Round: Lessons of a Success
Story," The World Economy, Vol. 3, June 1980, p. 60.