Section 301 of the Trade Act of 1974, as Amended

Testimony was given concerning the use of section 301 of the Trade Act of 1974 in combating unfair foreign trade practices. This provision gives the President broad powers to enforce U.S. trade agreement rights and eliminate foreign government policies that are unjustifiable and discriminatory; however, there have been concerns that the provision is not strong enough, and that the process is too lengthy. The act allows private parties access to the General Agreement on Tariffs and Trade (GATT) dispute resolution process by obtaining U.S. government aid to address unfair foreign trading practices. However, because the complex balancing of international, domestic, legal, and political issues make the GATT process lengthy, the act has been only minimally effective. Since the Office of the U.S. Trade Representative (OUSTR) does not follow up on resolved cases to evaluate the impact of the resolutions, and trading partners have not always fully complied with the resolutions, the U.S. has had to take some retaliatory measures. Although no unfair trade practices have been eliminated through retaliation, retaliation may provide some leverage to remove unfair trade practices in future efforts. Many petitioners are dissatisfied with the act's process and generally advocate stricter domestic and international timeframes for case settlement. GAO believes that: (1) the act is sufficiently broad to cover many unfair practices and does not need revision; (2) strengthening the GATT dispute process could make the act's provision more efficient; and (3) a uniform mechanism should be established to limit the length of U.S. participation in the dispute process.