On September 1, 2020, the Office of the U.S. Trade Representative, together with the Departments of Commerce and Agriculture, published a “Report on Seasonal and Perishable Products in U.S. Commerce.” The promise in today’s featured quote – namely that USTR would self-initiate a 201 case on blueberries – was fulfilled on September 29, when Ambassador Lighthizer sent a letter to the International Trade Commission, asking the Commission to open such an investigation. This is now Investigation No. 201-TA-077, the purpose of which is
…to determine whether fresh, chilled, or frozen blueberries are being imported into the United States in such increased quantities as to be a substantial cause of serious injury, or the threat thereof, to the domestic industry producing articles like or directly competitive with certain imported articles.
Safeguard cases initiated by the Administration are relatively rare, though that may be changing. As one author has written about such cases generally,
“Safeguard” duties under Section 201 of the Trade Act of 1974 are experiencing a renaissance after being a dormant area of practice for most of the last two decades.*
Indeed, the above mentioned report on Seasonal and Perishable Products alerts the reader at the outset to the possibility that USTR may later request Section 201 investigations into imports of strawberries and bell peppers, depending, among other things, on the outcome of current discussions with Mexico.
For today, however, we’ll keep our focus on blueberries. One has to give the U.S. International Trade Commission high marks for efficiency. Not only have they opened an investigation, they have laid out a full schedule showing how that investigation should flow, from the first briefs, due on December 29, 2020; to the final vote, which is scheduled for February 11, 2021, with a hearing on January 12, 2021.
The ITC investigation is the one called for by the relevant provision of law. Before requesting it, however, the Administration in effect conducted its own investigation. That included virtual hearings this past August with some 60 witnesses. Those generated about 500 pages of testimony, which was further enriched by “approximately 300 submissions from interested parties.”
Clearly, one of the pertinent findings of the Lighthizer-Ross-Purdue report is that “U.S. imports of blueberries have increased significantly over the last 15 years, from 50 million pounds in 2005 to almost 400 million pounds in 2018.” As for the value of commercially grown blueberries in the United States, the Department of Agriculture estimates that at just under $909 million for 2019. If we are reading the numbers correctly, that is less than the value of blueberries imported into the U.S. in 2019. That was $1.242 billion, with most of that product coming from five countries: Peru, Chile, Mexico, Canada, and Argentina.
So it is not surprising that the Administration believes some relief is in order. But why an escape clause investigation? The Seasonal and Perishable Products report answers that question by focusing on two elements of safeguard cases. “Section 201 does not require a finding of an unfair trade practice,” the authors explain. And, further, “Section 201 investigations are not restricted to assessing imports from one particularl country.”
A third salient feature of Section 201 cases, is that, where the result is tariffs or other restrictions on fairly traded imports, the international rules allow the exporting countries to retaliate.
