was the subject of my Trade Tripper column in the recent weekend issue of BusinessWorld:
An area of tension between the Executive and
Legislative branches of government is in the area of international
trade. Constitutional law is simple enough regarding that: tariff powers
are with the Congress and treaties can only take effect upon
concurrence by the Senate. But, as usual, what looks clear-cut on paper
becomes complicated in real life, with trade being directed effectively
by unelected bureaucrats and going past the country’s elected
So it is with interest -- considering the constitutional
similarities between the Philippines and the US -- that your Trade
Tripper read the draft “Bipartisan Congressional Trade Priorities Act of
2014’’ of the US Congress (see copy here http://www.finance.senate.gov/imo/media/doc/TPA%20bill%20text.pdf).
The bill clearly lays out the fact that trade and tariff matters are
within the purview of Congress, for which the Executive acts only under
The bill lays out the US’ overall trade objectives, which amongst others
include: obtain more open, equitable, and reciprocal market access; the
reduction or elimination of barriers and distortions that are directly
related to trade and investment and that decrease market opportunities
for US exports; further strengthen the system of international trade and
investment disciplines and procedures, including dispute settlement; to
foster economic growth, raise living standards, enhance
competitiveness, promote full employment and enhance the global economy;
ensure that trade and environmental policies are mutually supportive
and to seek to protect and preserve the environment; promote respect for
worker rights and the rights of children consistent with core labor
standards of the International Labor Organization.
Most admirably is the objective of the US to “ensure that trade
agreements afford small businesses equal access to international
markets, equitable trade benefits, and expanded export market
opportunities, and provide for the reduction or elimination of trade and
investment barriers that disproportionately impact small businesses.”
This is a policy sadly lacking urgency for the Philippines.
Interestingly, the US president is required to notify, consult, and
coordinate with the Congress in every step of the negotiations: from
initiation to conclusion. This is a world apart from the system here,
where Congress is usually called in only when the trade agreement needs
the concurrence of the Senate, the default procedure being to consider
the trade agreement as an “executive agreement” and thus purely within
the purview of the Executive branch.
But such would be anomalous as treaties effectively change Philippine
laws and for Congress to be kept out of the process means that the
president can change or amend laws simply by entering into international
Hence, why the US bill requires the US president, at least 90 calendar
days before the day on which the president enters into the trade
agreement, to notify Congress of his intention to enter into the
agreement and promptly thereafter publish notice of such intention in
the Federal Register. Also, within 60 days after entering into
the agreement, the president must submit to Congress a description of
those changes to existing laws that the president considers would be
required in order to bring the United States into compliance with the
agreement. Quite markedly, the US president is required to make the
information relating to the proposed agreement available to the public.
Should the US president fail to closely work with Congress, then the US
bill allows for “procedural disapproval resolution,” This is a
Congressional resolution which essentially reads as follows: “That the
President has failed or refused to notify or consult in accordance with
the Bipartisan Congressional Trade Priorities Act of 2014 on
negotiations with respect to and, therefore, the trade authorities
procedures under that Act shall not apply to any implementing bill
submitted with respect to such trade agreement or agreements,” with the
blank space being filled with a description of the trade agreement or
agreements with respect to which the President is considered to have
failed or refused to notify or consult.
The US bill would be a good study for Philippine policymakers and
lawmakers. The present law authorizing the Philippine president to enter
into trade agreements (Section 402 of the Tariff and Customs Code)
certainly has flaws, most notably its general language.
Thus, the president can enter into a trade agreement “for the purpose of
expanding foreign markets for Philippine products as a means of
assistance in the economic development of the country, in overcoming
domestic unemployment, in increasing the purchasing power of the
Philippine peso, and in establishing and maintaining better relations
between the Philippines and other countries.”
The foregoing is quite possibly an instance of undue delegation to the
president. Commonsensically, for instance, any proper delegation should
be only for a set period and not in perpetuity.
The president’s trade authority under Section 402 has certainly been
criticized, most cogently by Justice Florentino Feliciano (see his paper
“Deconstruction Of Constitutional Limitations And The Tariff Regime Of
The Philippines: The Strange Persistence Of A Martial Law Syndrome”).
Unfortunately, present drafts of Congress’ Customs and Tariff Modernization Act absolutely overlook this matter.