MFA II was in effect through December 1981. On December 22, 1981, a protocol was initialed extending the MFA for an additional four and a half years, and providing a further interpretation of MFA requirements in light of 1981 conditions. 12 MFA III expired on July 31, 1986. MFA IV went into effect on August 1, 1986 for a five-year period. MFA IV was extended on July 31, 1991 for 17 months from August 1, 1991 until December 31, 1992, with the expectation that the results of the GATT Uruguay Round of Multilateral Trade Negotiations would come into force immediately thereafter. On December 10, 1992, the MFA was extended for a fifth time, until December 31, 1993.

One aim of the Uruguay Round is to integrate the textiles and clothing sector into the GATT. The draft text issued by the GATT Director General in December 1991 includes a phase-out of the MFA through elimination of quotas covering a certain percentage of imports and accelerated growth rates on remaining quotas in each of three stages over a 10-year transition period.

As of July 1991, exports of textiles and clothing from the 41 members of the MFA (the European Communities counting as one) amounted to nearly $200 billion, of which two-thirds is governed by the MFA.13

BILATERAL TEXTILE AGREEMENTS

Under the authority of section 204 of the Agricultural Act of 1956, as amended, and in conformity with the MFA, the President has negotiated bilateral agreements restricting textile exports from various supplier countries. There are 35 such bilateral agreements currently in force; the United States also maintains unilateral restraints on products from Myanmar. 14 The agreements apply to textile products, covering not only fiber and fabric, but apparel as well.

The terms of each bilateral agreement are worked out through negotiation. The life of an agreement ranges from 3 to 6 years. Each agreement contains flexible, specific, and/or aggregate limits with respect to the type and volume of textile products that the supplier country can export to the United States. Limits are set in terms of square meter equivalents (SME's). The MFA allows, under certain conditions, for carryover (from the prior year to current year within the same product category), carryforward (from the subsequent year to the current year within the same product cate gory), and swing (from one product category to another product category within the same year) of unused portions of quotas. These provisions may be applied only with respect to specific import limits set forth in the bilateral agreement. Each agreement also provides for adjustment of import levels in accordance with specified growth rates. Some of the bilaterals provide for an export con

12 T.I.A.S. 10323 (1981).

13 Signatories to the MFA are: Argentina, Austria, Bangladesh, Brazil, Canada, China, Colombia, Costa Rica, Czechoslovakia, Dominican Republic, European Communities, Egypt, El Salva dor, Fiji, Finland, Guatemala, Hong Kong, Hungary, India, Indonesia, Jamaica, Japan, Korea, Macau, Malaysia, Mexico, Norway, Pakistan, Peru, Philippines, Poland, Romania, Singapore, Sri Lanka, Sweden, Switzerland, Thailand, Turkey, United States, Uruguay, and Yugoslavia. 14 As of July 21, 1992.

trol system to be administered by the exporting country to assure compliance with the terms of the agreement.

Consultation levels apply to categories which do not have specific limits. Once imports in a particular category reach the consultation level, the U.S. Government requests or "calls" for consultations to control imports in that product category. If consultations fail to produce an agreement on restrictive levels, and the United States is able to demonstrate that such imports are causing market disruption, then the United States may take unilateral action, such as an embargo, to restrict further imports in that product category. The Committee for Implementation of Textile Agreements (CITA) is responsible for administering the bilateral textile agreements program. 15 CITA is composed of representatives from the Departments of Commerce, State, Labor, and Treasury, and the Office of the U.S. Trade Representative. The Commerce Department official is chair of the committee, and heads the Office of Textiles and Apparel (OTEXA) in the Department of Commerce which implements the terms of the agreements and decisions made by CITA. A primary function of CITA is to monitor imports and to determine when calls for consultations are to be made.

Section 22 of the Agricultural Adjustment Act of 1933

Section 22 of the Agricultural Adjustment Act of 1933, as amended, (7 U.S.C. 624) authorizes the President to impose fees or quotas on imported products that undermine any U.S. Department of Agriculture (USDA) domestic commodity program. This authority is designed to prevent imports from interfering with USDA efforts to stabilize domestic agricultural commodity prices.

The protection of farm income has long been considered essential to assure the nation balanced and adequate supplies of food and fiber. A fundamental objective of U.S. agricultural policy, therefore, has been to stabilize and support farm prices. The Congress has mandated minimum support prices for some of the major storage farm commodities; discretionary support authority exists for other commodities; and in other cases, growers are authorized to regulate marketing of perishable products.

When world commodity prices are lower than domestic support prices, imports may enter the U.S. market in increasing quantities, and undercut domestic support prices. Consequently, either the USDA must remove larger quantities from the market or farmers must make sharper cuts in production. The negative effect that imports can have on the USDA's commodity price support programs provided the basis for enacting this import control authority in 1935.16 Since then section 22 has been amended several times.

Basic provisions

Under section 22, the Secretary of Agriculture is directed to advise the President when the Secretary has reason to believe that imports of any article "in such quantities as to render or tend to render ineffective, or materially interfere with" any USDA price

15 Exec. Order 11651, 3 CFR 676 (1971-75 Comp.).

16 Section 22 was added by section 31 of the Act of August 24, 1935, Public Law 74-320, 49 Stat. 773.

support or other agricultural program, or "reduce substantially the amount of any product processed in the United States from any agricultural commodity or product thereof" covered by a USDA agricultural program. Such determination is usually based on USDA activities in monitoring imports, although private parties can request the Secretary to take action pursuant to this section.

If the President agrees that there is reason for such belief, he must order an investigation by the U.S. International Trade Commission (ITC). The ITC must give precedence to such investigation, and report its findings along with recommendations for action to the President.

Based on the ITC report, the President must determine whether the conditions specified in the statute exist. If the President makes an affirmative determination, he is required to impose, by proclamation, either import fees or import quotas sufficient to prevent imports of that product from harming or interfering with the relevant agricultural program. Any import fee imposed, however, may not exceed 50 percent ad valorem. Any import quota imposed may not exceed 50 percent of the quantity imported during a representative period, as determined by the President. These ceilings are statutorily set, and may not be exceeded even if, after imposition of fees or quotas, imports continue to enter the United States in such quantities as to interfere with any agricultural program. In designating the articles subject to such a fee or quota, the President may describe them by physical qualities, value, use, or any other basis.

If the Secretary of Agriculture determines and reports to the President that emergency action is needed, the President may take immediate interim action without awaiting a report from the ITC. Such interim action will continue in effect until the President acts on the ITC report.

Any decision of the President as to facts under section 22 is final. The President may modify, suspend, or terminate any fees or quotas imposed after an ITC investigation and report and a Presidential determination that changed circumstances require modification, suspension or termination.

Relationship to international agreements and other laws

The authority of section 22 supersedes any inconsistent provisions of international agreements entered into by the United States.17 The use of section 22 quotas is inconsistent with Articles II and XI of the General Agreement on Tariffs and Trade (GATT). (Article II prohibits inequitable treatment of trading partners; and Article XI forbids the use of quantitative import restrictions unless domestic production or marketing controls are in effect). To remedy the inconsistency between section 22 and these GATT articles, the United States sought and received a waiver of its GATT obligations relative to Articles II and XI in 1955.18

Fees established under section 22 are not affected by duty-free status granted to any country under the Generalized System of

177 U.S.C. 624(f).

18 Decision of 5 March 1955 as reported in the Basic Instruments and Selected Documents, Third Supplement, General Agreement on Tariffs and Trade, Geneva, June 1955.

Preferences, the Caribbean Basin Initiative, or the Andean Initiative. For all other countries, section 22 fees are in addition to any applicable tariffs in effect. Quotas imposed under the section are usually allocated among supplying countries in accordance with each country's proportionate market share during a previous representative period. There are generally no provisions under section 22 for exclusion or preference of products from specific countries. However, in 1988, section 22 was amended to authorize the President to exempt certain products of Canada from any import restrictions imposed under that section.19 This statutory amendment is limited to the provisions of articles 705.5 and 707 of the U.S.Canada Free-Trade Agreement (FTA), relating to import restrictions on two commodities and their products. Under article 705.5, the United States and Canada reserve their rights to impose quantitative restrictions or import fees on imports of specified grains or grain products when imports of the particular grain increase significantly as a result of a substantial change in the U.S. or Canadian support programs for that grain. Article 707 prohibits the United States from imposing import quotas or fees on Canadian products containing 10 percent or less sugar by dry weight for the purpose of restricting the sugar content of such products.

Application

Since its enactment in 1935, section 22 has been used to impose import restrictions on 12 different commodities or food product groups: (1) wheat and wheat flour; (2) rye, rye flour, and rye meal; (3) barley, hulled or unhulled, including rolled, ground, and barley malt; (4) oats, hulled or unhulled, and unhulled ground oats; (5) cotton, certain cotton wastes, and cotton products; (6) certain dairy products; (7) shelled almonds; (8) shelled filberts; (9) peanuts and peanut oil; (10) tung nuts and tung oil; (11) flaxseed and linseed oil; and (12) sugars, sirups, and sugar-containing products. Section 22 fees and quotas have since been terminated for most of these commodities. As of late 1992, however, import quotas are in place to protect certain cotton, specific dairy products, peanuts, and certain sugar-containing products, such as sweetened cocoa, pancake flours, and ice-tea mixes. Import fees remain in place on refined sugar. The fees and quotas applicable to imported products under section 22 are specified in Chapter 99, subchapter IV of the Harmonized Tariff Schedule of the United States.

Meat Import Act of 1979

The Meat Import Act of 1979, as amended, 20 requires the President to impose quotas on imports of beef, veal, mutton, and goat meat when the aggregate quantity of such imports on an annual basis is expected to exceed a prescribed trigger level. The predecessor statute of the Meat Import Act of 1979 was the Meat Import Act of 1964,21 which provided similar authority to the President to impose quotas on meat imports, based on a different formula.

19 Section 301(c) of Public Law 100-449, approved September 28, 1988; 102 Stat. 1868. 20 Public Law 96-177, approved December 31, 1979, 93 Stat. 1291, as amended by section 301 of Public Law 100-449, approved September 28, 1988, 102 Stat. 1851, 1865, 19 U.S.C. 1202. 21 Public Law 88-482, approved August 22, 1964.

Background

In 1964, the U.S. cattle industry was facing depressed economic conditions, and sought relief from increasing import competition. The Johnson Administration that year negotiated voluntary restraint agreements with Australia, New Zealand, Ireland and Mexico with respect to their exports of meat to the United States. Pressure for import quotas continued, however, and during the summer of 1964, the Meat Import Act of 1964 was passed by Congress and signed by President Johnson.

The Meat Import Act of 1964 required the President to impose quotas on imports of meat from cattle, goats and sheep whenever the Secretary of Agriculture determined that, without quotas, imports would equal or exceed a specified trigger level. The trigger was based on the average annual level of meat imports between 1959 and 1963, plus 10 percent, adjusted upward by the percentage increase, or downward by the percentage decrease, in domestic commercial production of these meats since the 1959-63 period. The President could suspend or raise the quotas, however, for overriding economic or national security interests, or for reasons of inadequate domestic supply.

The provisions of the 1964 law were expected to help raise domestic meat prices and thus help revive the domestic cattle industry. In the years following enactment, however, domestic cattle prices remained low.22 Moreover, until 1976 no quotas were imposed on meat imports. During many years the level of expected meat imports for that year fell below the trigger level. During other years, the Federal Government either negotiated voluntary restraint agreements with foreign suppliers, or suspended the required quotas due to "over-riding economic interests" simultaneously with their proclamation. In October of 1976 a quota was imposed on meat from Canada, but the quota was terminated at the end of that same year.

By the late 1970's U.S. livestock producers had stepped up efforts to strengthen the 1964 law. These efforts culminated in the passage of the Meat Import Act of 1979. Congress passed the Act on December 18, 1979, and December 31, 1979, President Carter signed it into law.

Basic provisions

The Meat Import Act of 1979 requires the President to impose a quota on imports of beef, veal, mutton, and goat meat when the aggregate quantity of such imports is expected to exceed an adjusted base quantity by 10 percent or more, on an annual basis. The trigger level, setting off quotas, is thus 110 percent of the adjusted base quantity.

From 1979 through March 1989, the base quantity has been statutorily set at 1,204,600,000 pounds. The base quantity is adjusted annually by a countercyclical formula which allows more imports when domestic supplies are low, and less imports when domestic supplies are abundant. The formula multiplies the base

22 By the early 1970's farm prices for beef improved for a short time, but profits were again depressed after 1973 by overexpansion, rising production costs, and a decline in domestic consumption.