With the deadlines now having passed for moving the UK and Kenya agreements through the 2015 Trade Promotion Authority (TPA) process, there has been some talk about pursuing instead more “skinny” or “mini”-deals especially given that the prospects of renewing TPA remain in doubt. Even apart from TPA, additional executive-driven trade deals have been in vogue in U.S. trade law over recent years. Readers of this blog will be well aware of conversations to negotiate these sorts of deals with Brazil, Japan, India, and China, just to name a few.
Call these deals what you like – and, to be sure, what they are to be called has been a matter of debate – they all have one major quality in common apart from their governance of foreign commerce: they are not subject to congressional review following their negotiation. Some of that is by design, but for the lawyers among us, that ought to create some question about their legal authority seeing that not all appear to be the product of a congressional delegation. (We’ve heard ripples of that concern before: recall the Anti-Counterfeiting Trade Agreement debates of a decade ago.) But I want to pause on that question for a moment to talk more about the details of these trade executive agreements (TEAs).
In 2020 alone, 32 of these trade-related executive agreements entered into force. You hear about them from time to time from different executive branch agencies. In fact, the total numbers are staggering: my team and I have catalogued a total of 1228 TEAs (with another 500 or so pending our review) concluded by various executive branch agencies. Most were negotiated in the last forty or so years (i.e., they are not new) and most are still in force today. They cover a range of topics. Some are engagement-building agreements such as the several dozen Trade and Investment Framework Agreements that “provide strategic frameworks and principles for dialogue on trade and investment issues”. Others go far beyond such expressions of cooperation and include binding commitments such as protections for specific intellectual property rights, changes to regulatory processes for U.S. goods, new requirements for foreign products to enter the U.S. market, and more.
In a series of forthcoming and recent articles, my team and I have tried (and continue trying) to get to the bottom of what is happening with TEAs – the ways through which they are made (including engagement with Congress or lack thereof), their management and monitoring, their transparency and publication, their functions and utility, their termination or replacement, and much more. We have sought to create a taxonomy of these TEAs to figure out precisely how the trade world might understand them as compared to the traditional free trade agreement (FTA). Only a small percentage of TEAs are merely cooperative and even those that do not create robust binding commitments have served as the foundation for later binding arrangements. They cover the waterfront of topics including customs arrangements, food safety, insurance, tax, and autos, to name a few. In total, the United States has TEAs with 130 countries.
Bringing the full landscape of TEAs into focus yields several lessons – some of which will already be familiar to trade practitioners. The most practical and undernoticed realization is that these TEAs are doing a lot of work in our trade law, especially where FTAs are not possible. We have more than 100 with Japan and near that number with the EU and with China, but we also have several dozen with existing FTA partners. In some instances, TEAs build out FTAs, elaborate on them, clarify them, and update them. They are useful in expanding our trade agreements above and beyond the objectives set out in TPA and in resolving market access dilemmas where there is no FTA upon which to draw. As former USTR Robert Lighthizer told members of Congress at a 2020 hearing, these deals often solve narrow and immediate problems for U.S. industries, farmers, and ranchers.
Second, TEAs, like some other executive agreements, also have a significant and underestimated regulatory impact. They substitute for regulations despite that Congress has delegated this task to agencies to do through notice-and-comment rulemaking. A good example is the way agreements are used to protect foreign distinctive alcoholic beverages in U.S. law. Although there is a traditional rulemaking process outlined for U.S. protection and recognition of those spirits, TEAs have sometimes taken on that role themselves. The many ways through which TEAs are deployed to identify and protect distinctive foreign alcoholic products in turn creates questions about judicial review and international obligations that require further unearthing, which leads to my next point.
Third, TEAs need to be better conceptualized by scholars and by practitioners, including lawmakers themselves. These deals are doing valuable work to facilitate to U.S. trade but very little is known about them. To name just a few puzzles that emerge from the data: Why does the United States make trade law in such small pieces? What does this mean for their administrative review processes? What impact do they have on international trade law? How do we measure their economic force? And, how are they made part of U.S. law? Recognizing this data set and the momentous shift they have advanced is only a starting point. Completing the long list of interdisciplinary analysis that recognition demands comes next.
Fourth, and ironic given their ubiquity, is that TEAs are excessively difficult to track down. Given trade’s special place in our constitutional framework, these deals don’t always get captured by the usual executive agreement review processes. Instead, one has to go looking for them in a variety of places such as the USTR Annual Report, Federal Register notices and press releases, subscription services, and in some instances, from foreign governments. Such a search may yield a list of agreements but not necessarily their texts. Far more could be done on the government side to make these available for the public and for Congress. In fact, given the difficulties of locating them, these 1228 may just be the tip of the iceberg.
At the end of the day, we need TEAs to serve at least some of the functions that they presently do and have done. There are arguments to be made for and against codifying TEAs and adding congressional consultations along the way in at least some instances. It may be that the increasing constraints in TPA have pushed more executive branch agencies toward TEAs. Our next trade agreement delegation legislation may not look like the old TPA model given present interests. Regardless of its central focus or aim, it ought to take these no-longer-skinny deals into account. I’ll lay out more about what that might look like in a future post. For now, this much is clear: TEAs are unlikely to disappear anytime soon as they have become critical tools in our trade law toolkit.
