U.S. and Morocco Sign Free Trade Agreement (Congressional Approval, Etc. Still Required)
The Office of the U.S. Trade Representative (USTR) has issued a press release announcing that on June 15, 2004, the U.S. and Morocco signed the U.S.-Morocco Free Trade Agreement (FTA).
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Next Step in Implementing U.S.-Morocco FTA is Congressional Approval of Implementing Legislation
According to U.S. government sources, since the U.S. and Morocco have signed the U.S.-Morocco FTA, the next step is for the President to formally submit the U.S.-Morocco FTA implementing legislation package (U.S.-Morocco FTA, implementing legislation, and statement of administrative action) to Congress. Congress will then have 90 legislative days to consider the U.S.-Morocco FTA implementing legislation, which cannot be amended. If the U.S.-Morocco FTA implementing legislation is passed by Congress (both House and Senate), it could then be signed into law by the President, who would subsequently issue a proclamation implementing the U.S.-Morocco FTA.
Although Administration sources state that their "goal" is to complete the above steps in 2004 so that the U.S.-Morocco FTA could take effect as early as January 1, 2005, these sources note that Congress' schedule, the fall 2004 elections, and other factors could impact the achievement of this goal.
Highlights of U.S.-Morocco FTA
The USTR has previously described the provisions of the U.S.-Morocco FTA as follows (partial list):
More than 95% of bilateral trade in consumer/industrial products becomes duty-free immediately. More than 95% of bilateral trade in consumer and industrial products will become duty-free immediately, with all remaining duties eliminated within nine years.
Textiles and apparel will be duty-free if they meet FTA rule of origin. Under the U.S.-Morocco FTA, textile and apparel trade will be duty-free if imports meet the FTA's rule of origin, promoting new opportunities for U.S. and Moroccan fiber, yarn, fabric, and apparel manufacturing. In addition, the U.S.-Morocco FTA requires qualifying apparel to contain either U.S. or Moroccan yarn and fabric and contains a temporary 30,000,000 m2 allowance for apparel containing "third country" content.
Expanded markets for U.S. agricultural products. The U.S.-Morocco FTA covers all agricultural products. U.S. poultry, beef, and wheat will benefit from greater access under tariff-rate quotas; tariffs on corn, sorghum, and soybeans will be cut significantly or eliminated immediately; and processed foods, nuts, and horticultural products will gain significant new market access.
Tariffs on virtually all U.S. farm exports to Morocco will be phased-out within 15 years and the U.S. will phase-out all agricultural tariffs under the U.S.-Morocco FTA, most in 15 years. An agricultural safeguard will be available in the event of significant price decreases for certain horticultural products.
Transparent and efficient Customs procedures. The U.S.-Morocco FTA requires transparency and efficiency in customs administration, including publication of laws and regulations on the Internet and procedural certainty and fairness.
Both the U.S. and Morocco agree to share information to combat illegal transshipment of goods. In addition, the FTA requires customs procedures designed to facilitate the rapid clearance through customs of express delivery shipments. Strong but simple rules of origin will ensure that only U.S. and Moroccan goods benefit from the FTA and that those rules are designed to be easy to administer and are consistent with other U.S. FTAs in the region.
Commitments to open services market. Morocco will accord substantial market access across its entire services regime, subject to very few exceptions. The key services sectors covered by the FTA include express delivery, telecommunications, computer and related services, distribution, etc.
Protections and non-discriminatory treatment for digital products. State-of-the art protections and non-discriminatory treatment are provided for digital products such as U.S. software, music, text, and videos. Protections for U.S. patents, trademarks, copyrights, and trade secrets follow the high standards of U.S. bilateral FTAs.
No Customs duties on digital products. Both the U.S. and Morocco have committed to non-discriminatory treatment of digital products and agree not to impose customs duties on digital products. For digital products delivered on hard media (such as a DVD or CD), customs duties will be based on the value of the media (e.g., the disc).
Tough penalties for piracy and counterfeiting. The U.S.-Morocco FTA requires each government to criminalize end-user piracy, providing strong deterrence against piracy and counterfeiting. Both the U.S. and Morocco commit to having and maintaining authority to seize, forfeit, and destroy counterfeit and pirated goods and the equipment used to produce them. In addition, intellectual property rights (IPR) laws will be enforced against goods-in-transit, deterring violators from using U.S. or Moroccan ports or free-trade zones to traffic in pirated goods.
USTR press release (2004-53, dated 06/15/04) available athttp://www.ustr.gov/releases/2004/06/04-53.pdf.
Additional information on the U.S.-Morocco FTA, including fact sheets, draft text, etc. available at http://www.ustr.gov/new/fta/morocco.htm.