The U.S. Senator Mr. Kerry has presented a proposal for the introduction of Fair Trade Act on Tuna Pouch to the U.S. Senate.
The bill, which is numbered S. 1739, comes as a reaction to the fact that the Andean countries Ecuador and Colombia were granted duty free import of preserved tuna in pouches last year by the Bush Administration.
Tuna pouches in the U.S. market from Asia are slapped with a 12% tariff, whereas imports from the Andean countries are getting duty free access. The result of this difference in tariffs has been that Starkist / Del Monte has mostly concentrated its production of retail tuna pouches in Ecuador, and that the Ecuadorian tuna industry is gearing up its investments in pouches.
Thailand had already made the major part of its investments in the tuna pouch production, in the form of special retorts, vacuum sealing machines and other equipment, before the Andean Act was enforced.
By introducing the bill S. 1739, Senator Kerry hopes to re-install Thailand’s competitive position for tuna pouch. The largest possible beneficiary could be the company TUF (Thai Union Frozen). This company owns two major pouch-producing plants in Thailand, and also the U.S. leading tuna brand: Chicken-of-the-Sea.
Unlike StarKist / Del Monte – TUF / COS does not have any production facilities in Ecuador.
In general, production costs of a tuna pouch per unit are lowest in Thailand. Therefore the passing of the Fair Trade Act S. 1739 would surely hurt Ecuador’s and Colombia’s efforts to expand in the U.S. market for tuna in pouch.
Below the full text of the Fair Trade Act S. 1739 on tuna pouch:
Fair Trade in Pouch Tuna Act of 2003 (Introduced in Senate)
S 1739 IS
108th CONGRESS
1st Session
S. 1739
To provide duty-free treatment for certain tuna.
IN THE SENATE OF THE UNITED STATES
Mr. KERRY (for himself and Mr. KENNEDY) introduced the following bill; which was read twice and referred to the Committee on Finance
A BILL
To provide duty-free treatment for certain tuna.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
This Act may be cited as the `Fair Trade in Pouch Tuna Act of 2003'.
Congress finds that--
(1) a strong relationship between the United States and the member nations of the Association of Southeast Asian Nations (ASEAN) is a force for stability and development in the Southeast Asian region and international trade is a critical element of this relationship;
(2) many of the ASEAN nations are important friends and allies in the ongoing fight against world terrorism;
(3) ASEAN nations provide a large portion of the processed tuna imported into the United States;
(4) such imports are subject to tariffs whereas tuna in airtight pouches imported from the beneficiary countries of the Andean Trade Promotion and Drug Eradication Act (Andean) are not;
(5) as a result, tuna in airtight pouches imported from ASEAN member nations is placed at a competitive disadvantage that has harmed the economies of these nations and that will ultimately harm consumers in the United States; and
(6) eliminating tariffs on pouch tuna imported from the ASEAN countries in a quantity equal to the quantity imported from Andean countries will restore fair trade in the pouch tuna market and will benefit United States consumers and the economies of the ASEAN nations.
(a) IN GENERAL- Subchapter II of chapter 99 of the Harmonized Tariff Schedule of the United States is amended by inserting in numerical sequence the following new heading:
(b) ASEAN COUNTRIES- The U.S. Notes to subchapter II of chapter 99 of the Harmonized Tariff Schedule of the United States are amended by adding at the end the following:
`17. For purposes of heading 9902.16.04:
`(a) Products of the following countries are eligible to enter at the special rate of duty set forth in such subheading: Brunei, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, and Vietnam. The term does not include the Union of Myanmar.
`(b) The aggregate quantity of tuna entered under subheading 9902.16.04 during any calendar year shall be limited to the quantity of tuna entered free of duty from an ATPDEA beneficiary country (as defined in section 204(b)(6)) of the Andean Trade Preference Act (19 U.S.C. 3202(b)(6)) and designated in Note 11(d) of this Schedule) during the preceding calendar year pursuant to section 204(b)(4) of the Andean Trade Preference Act (19 U.S.C. 3202(b)(4)).'.
(c) EFFECTIVE DATE- The amendments made by this section apply to goods entered, or withdrawn from warehouse, for consumption on or after the 15th day after the date of enactment of this Act.