Ray Bucheger Reports from Washington D.C.

Lighthizer indicated that extensions of exclusions will expire at the end of 2020, rather than be granted for a six or twelve month duration.
 When pressed on whether China would fulfill its commitments under the Phase One deal, Lighthizer said the Chinese were making a good-faith effort to do so, and he was particularly bullish on China’s commitments to increase commodity imports, telling the committees the Chinese are on track to meet their commodity purchase obligations by the end of the year.
Hong Kong
President Trump announced several weeks ago that his administration would take action to revoke Hong Kong's preferential treatment as a separate customs and travel territory apart from the rest of China, which could expose Hong Kong to China 301 tariffs and other US trade actions. When asked about this, Lighthizer said his office is still analyzing the possible ramifications of treating Hong Kong as a separate customs area.
 US-Mexico-Canada Agreement
 There was a lot of discussion about Mexican labor standards and automobile trade. In general, Lighthizer repeatedly vowed to strongly enforce the USMCA as soon as it takes effect on July 1 and acknowledged the U.S. will likely need to use the enforcement tools in the new deal to tackle issues with Mexico on labor, biotechnology, intellectual property rights and energy.
  Section 321 / de minimis
Lighthizer used his opening statement to reinforce his desire to lower the de minimis amount.  While there wasn’t a lot of discussion about this issue during the question and answer portion of the hearings, the fact is that the Administration will continue to get a lot of pushback from members of Congress that want to maintain the current $800 de minimis level.
 There was one back-and-forth on the subject. During the Finance hearing, Senator John Thune (R-SD) expressed interest in pushing other countries to increase their de minimis thresholds, rather than decreasing the US de minimis amount. Lighthizer’s answer to this was that the current US de minimis amount has cost more US jobs than it has created, and he said the reason most other countries keep their thresholds so much lower is so that large online retailers don’t put small companies out of business. Lighthizer also said that a high number of packages evade scrutiny (the Administration has in the past expressed concern about 321 facilitating the flow of counterfeits) and he encouraged the Committee to study the effects of de minimis more in depth.
 WTO Reform
 Lighthizer testified that the WTO requires radical reform because the tariff situation is unfair; the appellate body is non-functional; and FTAs do not benefit all countries. He reinforced the Trump Administration’s frustration with the WTO appellate body in particular, arguing that it has been unfair to the United States and should not be restored (although he did express support for a dispute settlement process). When asked about the qualities a new Director-General of the WTO should have, he responded that the new Director-General should be someone that is reform minded and focused on updating the rules so as to keep China in check.