Hearing on American Trade Enforcement Priorities
House Committee on Ways & Means
Subcommittee on Trade
Hearing Date: February 18, 2025
Bryan Riley
Director, Free Trade Initiative
National Taxpayers Union
Submission for the Record
March 7, 2025
I appreciate the opportunity to submit these comments on behalf of National Taxpayers Union (NTU), a non-partisan citizen group founded in 1969 to work for less burdensome taxes, more efficient, accountable government, and stronger rights for all taxpayers. More about our work as a non-profit grassroots organization is available at www.ntu.org.
The United States led the creation of the World Trade Organization (WTO). A key U.S. negotiating objective, as directed by Congress in the Omnibus Trade and Competitiveness Act of 1988, was to create an agreement that provided for more effective and expeditious resolution of trade disputes and that enabled better enforcement of U.S. trade rights. In 1994, the General Accounting Office concluded that U.S. negotiators substantially achieved these objectives. The United States has initiated 124 WTO cases against unfair foreign trade practices. But since 2019, the United States has initiated just one case.
This is a big missed opportunity, particularly regarding China’s unfair practices.
In its 2024 Report to Congress on China’s WTO Compliance, the Office of the United States Trade Representative (USTR) concluded that China’s record of compliance with WTO rules has been poor. The report echoed similar findings reported by USTR under President Donald Trump.
However, the Biden Administration failed to initiate a single WTO claim against China. The Trump administration initiated just two actions against China, and instead focused on its unilateral Section 301 investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.
The statutory four-year USTR review of this unilateral action concluded: “China has not eliminated many of its technology transfer-related acts, policies, and practices, which continue to impose a burden or restriction on U.S. commerce. Instead of pursuing fundamental reform, the Government of China has persisted and even become more aggressive, particularly through cyber intrusions and cybertheft, in its attempts to acquire and absorb foreign technology, which further burden or restrict U.S. commerce.” This is not a desirable outcome.
NTU encourages you to take the following actions to better enforce U.S. trade rights:
Direct USTR to enforce U.S. trade rights by initiating claims against China’s actions that violate WTO rules. Many of these violations have been identified in USTR’s annual reports to Congress on China’s WTO compliance, and they just need to be acted on.
Work with USTR to identify areas where WTO rules are inadequate to address China’s harmful practices, and devise a plan to broaden WTO coverage to encompass these areas.
Direct USTR to strengthen the ability of the WTO to enforce U.S. trade rights. In particular, the United States should refrain from blocking the appointment of new members to the WTO Appellate Body (AB). Currently, if the United States wins a WTO case against China, China may appeal that decision to the AB for review. However, because the United States has blocked the appointment of new members to the AB, there is no functioning AB to adjudicate appeals, and U.S. WTO wins are unenforceable if appealed.
Work with the U.S. International Trade Commission (USITC), USTR, and other federal entities to identify ways to strengthen and speed up the WTO dispute resolution process to better enforce U.S. rights.
Direct the USITC to evaluate the effectiveness of unilateral tariff actions, WTO dispute resolution, and dispute resolution procedures used in U.S. free trade agreements to determine how to best combat unfair trade practices and prevent the application of loopholes that allow countries to skirt the rules.
Trade rules that limit unfair trade practices should be accompanied by an effective enforcement mechanism. Thank you for addressing this issue and for the opportunity to comment on U.S. trade enforcement priorities.