Following-up on the last post, it looks like the Indonesian clove cigarette makers have at least one defender in Congress. Congresswoman Virginia Foxx gave the following speech in the context of the discussion of the tobacco regulation bill (begins at bottom right of page and continues to next page):
Mr. Speaker, ‘‘The Family Smoking Prevention and Tobacco Control Act,’’ which is before us today, contains a socalled ‘‘special rule for cigarettes’’ in Section 907 of the bill that would ban flavored cigarettes—with the exception of menthol flavored cigarettes.
Since the legislation allows the sale of menthol cigarettes, which are produced in the United States and in my home State, while banning clove cigarettes, which are imported primarily from Indonesia, the Indonesian Government has made it clear that it considers this provision an attempt to discriminate against imported clove cigarette products in favor of a competing U.S. product—and thus section 907 in the bill runs contrary to the free-trade commitments the United States has made as part of the WTO.
According to WTO rules Mr. Speaker, an imported ‘‘good’’ (clove cigarettes) should receive treatment that is ‘‘no less favorable than that provided to a domestic good.’’ Adhering to this principle would appear to require that clove cigarettes be treated no less favorably than menthol cigarettes and thus under this bill both should be exempt from the prohibition on flavored cigarettes or both should be banned in order to ensure there is no unfair discrimination in the treatment of the two products. The latter option is not an option at all in my opinion but neither is ignoring the concerns of our ally Indonesia, a country well known to our President.
For years now, senior officials of the Indonesian Government have repeatedly and doggedly attempted to communicate their country’s concerns to U.S. legislators and executive branch policy-makers alike—to no avail. The communique from the Indonesian Ambassador to Chairman WAXMAN, as well as the Indonesian Trade Minister’s dispatch to former Ambassador Schwab clearly articulate the imperative the Indonesian Government places on the trade violation contained in ‘‘The Family Smoking Prevention and Tobacco Control Act.’’
Last year, the HHS Secretary sent a letter to Congress expressing various concerns about Mr. WAXMAN’s bill on behalf of the Administration. Among his concerns he included the following statement about the bill’s prohibition on imported clove cigarettes that reflects the concerns expressed by the Indonesian Government:
There is a further issue regarding the bill that I would like to bring to your attention. Our trading partners believe that by banning the sale of clove cigarettes but not prohibiting the sale of menthol cigarettes, the bill raises questions under U.S. international trade obligations. The government of Indonesia has repeatedly objected to the bill on the ground that this disparate treatment is unjustified and incompatible with WTO trade rules. Accordingly, I would recommend that the Committee further review the relevant language in this light to ensure the bill is consistent with U.S. trade obligations.
Mr. Speaker, Congress is increasingly—and rightly—calling on our United States Trade Representative and the Administration to more strenuously enforce the WTO and other trade agreements to ensure that our trade partners are playing by the rules and not discriminating against our products and services. I think that it is only right that we abide by the same standards that we expect of our trade partners when the question is as clear as this situation. It would have been my hope that the minor changes needed to correct this avoidable trade complication in the bill could have be made before the legislation was brought to the floor for consideration, but that was not the case. Section 907 affects a de facto ban on the importation of clove cigarettes from Indonesia. It is another troublesome example of serious flaws overlooked by Mr. WAXMAN in his bill.
