U.s.-Japan Trade Agreement Fact Sheet

The Digital Agreement is a separate agreement that establishes rules in the digital space15 The content of the Digital Agreement is practically in line with the provisions of the Agreement between the United States, Mexico and Canada (USMCA). Notable provisions include the prohibition of customs duties on electronically transmitted content (e.g. software and music.B) and the recognition of an electronic signature as a legally appropriate means of authentication. This is important as the World Trade Organization (WTO) moratorium on wire transfers will be renewed at the 12th Ministerial Conference in June 2020 (see the next issue of EY Tradewatch for a related article). Within four months of implementation, President Trump and Prime Minister Abe will shift their efforts to a broader trade deal. This broader agreement should cover both tariff and non-tariff barriers, including tariffs and restrictions on trade in services and investment. The Office of the U.S. Trade Representative (USTR) has released several fact sheets on the agreement, including on www.whitehouse.gov/briefings-statements/president-donald-j-trump-secured-tremendous-victory-american-farmers-businesses-new-japan-trade-agreements/ 9. In accordance with other bilateral free trade agreements, Annex II of the trade agreement contains the rules of origin and origin procedures for determining whether a product is eligible for preferential treatment. For the purposes of the trade agreement, something comes from Japan if it meets one of the following criteria: 8 ustr.gov/about-us/policy-offices/press-office/fact-sheets/2019/september/fact-sheet-agriculture%E2%80%90related#. USTR has also published online the full text of the agreement, as well as these subsidiary letters of interest: 10th U.S.-Japan Trade Agreement, Annex I: Japan`s Tariffs and Customs Provisions, I-B-5-1; ustr.gov/sites/default/files/files/agreements/japan/Annex_I_Tariffs_and_Tariff-Related_Provisions_of_Japan.pdf. Japan`s tariffs on U.S. muscle cuts will be eliminated over nine years.

Tariffs on most processed pork products, including the 20% tariff on seasoned pork, are introduced at zero over five years and gradually over ten years for ham and bacon. The maximum duty for products below the door price will increase from 482 yen/kg to 125 yen upon introduction and to 50 yen/kg over nine years. The protection of Japanese pork by the World Trade Organization (WTO) will no longer apply to U.S. pork, as Japan will create a new transitional mechanism for the protection of chilled and frozen pork similar to that contained in the CPTPP. For more details, see the USTR Fact Sheet for Pork, the Subsidiary Letter on Protective Measures, and the USMEF Sheets published below. Japan`s tariffs on chilled and frozen cuts of beef in the U.S. will be reduced from 38.5% to 9% over 15 years. Tariffs on cattle songs will fall from 12.8% to zero by 2028 and on other products by 2030. Tariffs on processed beef products will be gradually zero over the next five to fifteen years, depending on the product.

Cuts of beef chilled and frozen in the United States are subject to a U.S.-specific annual safety measure, which starts at 242,000 tons and will be increased according to the schedule outlined in the USTR Beef Fact Sheet. A single consultation mechanism for this Agreement for safeguard measures is also included, as set out in the Beef Information Sheet, in the subsidiary letter on safeguard measures and in the USMEF sheets published below. One of the main results of this agreement is rules that will lead to safeguard measures: this agreement provides for Japan`s limited use of safeguard measures for increased imports of beef, pork, whey, oranges and racehorses, which will end over time. . . .

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