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87–359—PDF 2013

S. HRG. 113–227 

NOMINATION OF MICHAEL FROMAN 

HEARING 

BEFORE THE

COMMITTEE ON FINANCE 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

ON THE

NOMINATION OF 

MICHAEL FROMAN, TO BE UNITED STATES TRADE REPRESENTATIVE, 

WITH THE RANK OF AMBASSADOR EXTRAORDINARY AND 

PLENIPOTENTIARY, EXECUTIVE OFFICE OF THE PRESIDENT 

JUNE 6, 2013 

( 

Printed for the use of the Committee on Finance 

COMMITTEE ON FINANCE 

MAX BAUCUS, Montana, Chairman 

JOHN D. ROCKEFELLER IV, West Virginia 

RON WYDEN, Oregon 

CHARLES E. SCHUMER, New York 

DEBBIE STABENOW, Michigan 

MARIA CANTWELL, Washington 

BILL NELSON, Florida 

ROBERT MENENDEZ, New Jersey 

THOMAS R. CARPER, Delaware 

BENJAMIN L. CARDIN, Maryland 

SHERROD BROWN, Ohio 

MICHAEL F. BENNET, Colorado 

ROBERT P. CASEY, Jr., Pennsylvania 

ORRIN G. HATCH, Utah 

CHUCK GRASSLEY, Iowa 

MIKE CRAPO, Idaho 

PAT ROBERTS, Kansas 

MICHAEL B. ENZI, Wyoming 

JOHN CORNYN, Texas 

JOHN THUNE, South Dakota 

RICHARD BURR, North Carolina 

JOHNNY ISAKSON, Georgia 

ROB PORTMAN, Ohio 

PATRICK J. TOOMEY, Pennsylvania 

AMBER COTTLE, Staff Director 

CHRIS CAMPBELL, Republican Staff Director 

(II) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Baucus, Hon. Max, a U.S. Senator from Montana, chairman, Committee 

on Finance ............................................................................................................ 1 

Hatch, Hon. Orrin G., a U.S. Senator from Utah ................................................. 3 

ADMINISTRATION NOMINEE 

Froman, Michael, nominated to be United States Trade Representative, with 

the rank of Ambassador Extraordinary and Plenipotentiary, Executive Office of the President, Washington, DC ............................................................... 6 

ALPHABETICAL LISTING AND APPENDIX MATERIAL 

Baucus, Hon. Max: 

Opening statement ........................................................................................... 1 

Prepared statement .......................................................................................... 37 

Froman, Michael: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 39 

Biographical information ................................................................................. 41 

Responses to questions from committee members ......................................... 50 

Hatch, Hon. Orrin G.: 

Opening statement ........................................................................................... 3 

Prepared statement .......................................................................................... 127 

(III) 

(1) 

NOMINATION OF MICHAEL FROMAN, TO BE 

UNITED STATES TRADE REPRESENTATIVE, 

WITH THE RANK OF AMBASSADOR 

EXTRAORDINARY AND PLENIPOTENTIARY, 

EXECUTIVE OFFICE OF THE PRESIDENT 

THURSDAY, JUNE 6, 2013 

U.S. SENATE, COMMITTEE ON FINANCE, Washington, DC. 

The hearing was convened, pursuant to notice, at 11:10 a.m., in 

room SD–215, Dirksen Senate Office Building, Hon. Max Baucus 

(chairman of the committee) presiding. 

Present: Senators Wyden, Schumer, Menendez, Carper, Cardin, 

Brown, Casey, Hatch, Grassley, Thune, Burr, Isakson, and Portman. 

Also present: Democratic Staff: Mac Campbell, General Counsel; 

Amber Cottle, Staff Director; Chelsea Thomas, Professional Staff 

Member; Hun Quach, International Trade Analyst; Tiffany Smith, 

Tax Counsel; Savanna Cochran, Intern; Laurie Dempsey, Detailee; 

Bruce Hirsh, Chief International Trade Counsel; and Rory Murphy, 

International Trade Advisor. Republican Staff: Nicholas Wyatt, Tax 

and Nominations Professional Staff Member; Richard Chovanec, 

Detailee; Kevin Rosenbaum, Detailee; and Rebecca Nasca, Staff Assistant. 

OPENING STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR 

FROM MONTANA, CHAIRMAN, COMMITTEE ON FINANCE 

The CHAIRMAN. The hearing will come to order. 

William Shakespeare once said, and I quote him, ‘‘Nimble 

thought can jump both sea and land.’’ 

The USTR brings both nimble thought and nimble action to bear 

on the complex world of trade negotiations and enforcement. And 

this nimbleness allows them to address the challenges of trade policy across sea and land. 

The USTR is lean; it is effective. With fewer than 250 employees, 

it punches beyond its weight to break down foreign barriers to U.S. 

goods, services, and intellectual property. And it negotiates the 

rules of trade that expand commerce, promote growth, and create 

jobs. 

USTR requires leadership that is equally nimble—leadership 

that can harness USTR’s strengths and the strengths of the U.S. 

Government as a whole. It needs a leader willing to put in the 

miles to meet with foreign counterparts and drive a hard bargain. 

2 

A leader willing to partner with us here in Congress to develop 

trade policies that work. And a leader willing to put in the hours 

to understand the challenges facing U.S. businesses, farmers, and 

ranchers—ranchers like Jim Peterson who are fighting to sell more 

U.S. beef around the world and are facing unscientific barriers in 

places like China. 

I am pleased that we have such a leader before us today. Michael 

Froman is the right person for this job. For the past 4 years, he 

has demonstrated a mastery of trade policy development and implementation. 

He understands the small details, and he sees the big picture. He 

has closed out trade agreements, guided global economic policy, 

and promoted initiatives that have boosted America’s exports by 

more than 40 percent. And he has skillfully represented the United 

States at global forums like the G–8 and the G–20. He is more 

than capable to do the job at hand. We should confirm his nomination, and we should do it quickly. 

President Obama has outlined an ambitious trade agenda, one 

that requires a strong trade representative like Mr. Froman who 

can hit the ground running. The time is ripe. The United States 

has an opportunity to share in the rapid growth of the Pacific region and to unlock further economic gains from our already deep 

ties with Europe. 

USTR seeks to complete the Trans-Pacific Partnership negotiations by the end of the year. It will soon be ramping up free trade 

agreement negotiations with the European Union, and it is hard at 

work in Geneva on a multilateral services agreement, expanding 

opportunities for U.S. information technology products and reducing border delays around the world. 

These trade policies will make a difference here at home. As a 

group, the TPP countries are the largest international market for 

U.S. goods and services. Last year, U.S. exports to current TPP 

countries totaled nearly $260 billion, representing 40 percent of 

total U.S. goods exports. 

And breaking down trade barriers in TPP countries will make a 

real difference. Japan relaxed its beef restrictions earlier this year, 

and our beef sales are almost 50 percent higher. Japan’s average 

agricultural tariffs are more than 20 percent, while ours are only 

5 percent. When those tariffs come down, our sales will go up. 

And the Transatlantic Trade and Investment Partnership will 

also stimulate economic growth and job creation. The European 

Union purchased close to $460 billion in U.S. goods and services 

last year, supporting 2.4 million American jobs. A comprehensive 

agreement that tackles long-standing regulatory and agricultural 

barriers could add even more jobs here at home. 

My home State of Montana shows how critical an ambitious 

trade agenda is to good-paying jobs. Montana’s manufacturers, 

farmers, and ranchers rely upon open markets to create and maintain jobs. In fact, one in six manufacturing jobs in Montana comes 

from exports. In the last decade, Montana’s goods exports to FTA 

partners have increased by 250 percent. Last year, Montana’s 

wheat growers exported 85 percent of their crop. 

Because of the tireless efforts of U.S. trade negotiators, ranchers 

from Clyde Park can now export American beef to Korea, and farmVerDate Nov 24 2008 15:41 Apr 08, 2014 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 R:\DOCS\87359.000 TIMD
3 

ers from Churchill can export American seed potatoes to Congo. We 

must fulfill the promise of our ambitious trade agenda. Confirming 

Mike Froman quickly will be the first step, but we are not done 

there. The next step will be to pass Trade Promotion Authority and 

Trade Adjustment Assistance. 

With so many trade initiatives moving to completion and getting 

off the ground, we need TPA now to guide and support USTR. And 

we need TAA, Trade Adjustment Assistance, to ensure that our 

workforce remains ready to compete with anyone, anywhere in the 

world. 

I am pleased that the administration supports TPA and worker 

assistance. Mr. Froman, I look forward to working with you to 

renew TPA and TAA in the next few months so that we can lay 

the groundwork for a successful trade agenda. I will continue my 

efforts to introduce a bipartisan TPA bill this month. 

Finally, I would like to emphasize that the USTR must continue 

to harness the resources and energy of the entire U.S. Government 

for our trade agenda to be successful. It must continue to be 

headquartered at the White House, and the U.S. Government must 

continue to pull together behind USTR’s leadership. 

The President’s ambitious trade agenda will require nimble 

thought and nimble action. And I am confident that, with Mike 

Froman at the helm, USTR will meet the ambition that the President has set. 

Mr. Froman, members of this committee will probably ask you 

some tough questions today. That is our right; it is our responsibility. 

Over the past several years, you have shown that you are willing 

to go the extra mile, over land and sea, to get the best deal for U.S. 

farmers, ranchers, businesses, and workers. And I believe you will 

serve ably as the next U.S. Trade Representative. I look forward 

to our discussion. 

[The prepared statement of Chairman Baucus appears in the appendix.] 

The CHAIRMAN. Senator Hatch? 

OPENING STATEMENT OF HON. ORRIN G. HATCH, 

A U.S. SENATOR FROM UTAH 

Senator HATCH. Well, thank you, Mr. Chairman, and thank you, 

Mr. Froman, for appearing here today and joining with us. I look 

forward to hearing your testimony. 

However, before talking about trade policy, I want to take a few 

minutes to talk about the wide disparity between the Obama administration’s rhetoric and the actions taken by administration officials. 

Now, this has particular relevance to Mr. Froman’s nomination. 

A few months ago, when the Finance Committee was considering 

the nomination of Jack Lew to be the Secretary of Treasury, we 

learned that he had invested in a Cayman Islands hedge fund located in the now infamous Ugland House that so many Democrats 

have decried as a tax haven. 

At the time, we reminded people that, in 2008, while campaigning for President, then-Senator Obama said that the Ugland 

4 

House was ‘‘either the biggest building in the world or the biggest 

tax scam in the world.’’ 

And throughout the 2012 campaign, President Obama repeatedly 

attacked Mitt Romney, his opponent, for having funds invested in 

the Caymans. In making such investments, Governor Romney was, 

in the words of the Obama campaign, ‘‘betting against America.’’ 

Yet the President had no problem nominating someone who made 

similar investments to be Treasury Secretary. 

As a result of our vetting process, we now have learned that Mr. 

Froman has actively invested roughly half a million dollars in the 

exact same hedge fund located at the Ugland House. 

Mr. Froman is, in fact, the third Cabinet-level nominee this year 

to have made use of offshore investments and structures, despite 

the President’s unequivocal condemnation of these types of activities during the campaign. Moreover, the Cayman Islands investment is in a fund that, in turn, has invested in companies that 

outsource jobs or, using the President’s rhetoric, ship jobs to lowwage countries like India. 

On top of that, we all remember in early 2009 when President 

Obama remarked about Wall Street, saying that institutions were 

‘‘teetering on collapse, and they are asking for taxpayers to help 

sustain them.’’ 

The President also railed against Wall Street bonuses at the 

time, saying, ‘‘That is the height of irresponsibility. It is shameful.’’ 

Elsewhere, he referred to Wall Street bonuses as ‘‘obscene.’’ 

Like Secretary Lew, Mr. Froman was employed at Citigroup during much of the financial crisis. In late 2008 and early 2009, American taxpayers provided over $45 billion—with a ‘‘b’’—in direct assistance to Citigroup and backed hundreds of billions of Citigroup 

assets. During those same 2 years, Mr. Froman received more than 

$5 million in bonuses, much of which was paid for work performed 

when Citi was on the verge of collapse. 

Once again, we see a contradiction between the President’s rhetoric with regard to Wall Street and his decision to nominate Mr. 

Froman to be the U.S. Trade Representative. 

Now, I do not raise these issues to suggest that Mr. Froman has 

done something wrong or that he has not complied with our tax 

laws. I believe he has complied, and he has lived within the law. 

Instead, I simply want to point out what appears to be hypocrisy 

on the part of President Obama and this administration. 

The President’s rhetoric seemed to suggest that offshore investments, investments in outsourcing, and Wall Street bonuses are 

not simply bad policy, but morally wrong. Yet the same vitriol used 

to attack the President’s political opponents does not seem to apply 

to his nominees for Cabinet positions. 

As I said during the debate over Secretary Lew’s nomination, the 

American people are essentially being told that they should do as 

the Obama administration says, not as they do. That does not inspire a lot of confidence, to say the least. 

That said, I do not believe we should let the administration’s contradictory statements distract us from trying to help grow our economy through trade. 

Indeed, the U.S. Trade Representative is a vital position. And despite any disagreements I might have with the Obama administraVerDate Nov 24 2008 15:41 Apr 08, 2014 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 R:\DOCS\87359.000 TIMD
5 

tion’s rhetoric, I believe this nomination should be considered on its 

own merits. 

Trade is an engine of economic growth. Since the end of World 

War II, international trade has helped pull millions of people out 

of poverty, while creating enormous opportunities for growth here 

in the United States. 

Unfortunately, it appears as though U.S. trade policy has been 

adrift for much of President Obama’s first term. The long delay in 

submitting the trade agreements with Colombia, Panama, and 

Korea kept U.S. exporters on the sidelines for far too long. And 

now we see they are working out as very good agreements. And 

while new and potentially meaningful negotiations have been 

launched by this administration, not one of them seems close to 

successful conclusion. Mr. Froman, I am counting on you to 

straighten that out. 

This is due both to a lack of real leadership and the fact that our 

trade negotiators do not have the tools needed to do their job. 

For example, Trade Promotion Authority expired in 2007, as the 

chairman has pointed out. As a result, our trade negotiators lack 

the authority necessary to negotiate and conclude new trade agreements. Unfortunately, there has been no real effort by President 

Obama to secure TPA renewal. 

Members of Congress have fought to fix this problem. We pushed 

for a vote on TPA renewal on the Senate floor 21 months ago. Unfortunately, that effort failed, largely due to lack of support from 

our Senate Democratic colleagues. 

To me, this shows that presidential engagement on TPA renewal 

is vital. Without the President’s active leadership and public support for TPA, it is hard to see how our current efforts to renew 

Trade Promotion Authority can succeed. 

And we must succeed. Today, 95 percent of the world’s customers 

live outside the United States. They account for 92 percent of global economic growth and 80 percent of the world’s purchasing power. 

But the United States is falling behind as we fight for access to 

these markets. 

Fortunately, the U.S. has a number of promising initiatives underway, including the Trans-Pacific Partnership and negotiations 

with the European Union, both mentioned by our distinguished 

chairman. 

These agreements must be comprehensive, incorporate the highest standards of intellectual property rights protection, and provide 

meaningful market access for U.S. exporters. In pursuing these initiatives, I hope the administration does not lose sight of the importance of our efforts under the auspices of the World Trade Organization, including expansion of the Information Technology and Government Procurement agreements and conclusion of a robust agreement on Trade in International Services and Trade Facilitation. 

Each of these represents an important opportunity to further advance trade and grow our economy. 

During our March hearing on the President’s trade agenda, I 

called on the President to nominate someone to serve as the United 

States Trade Representative who has the trade expertise, political 

savvy, and leadership skills necessary to effectively lead this agency. Our nominee today certainly appears to meet that test, and I 

6 

am pleased that you are willing to do this. You have served most 

recently as Assistant to the President and Deputy National Security Adviser for International Economic Affairs at the White House 

and in multiple senior economic roles under prior administrations. 

I intend to support you, but I did want to raise these issues because of, I think, the hypocrisy involved, certainly during the last 

election. 

Mr. Chairman, I want to thank you for holding this hearing 

today. I look forward to hearing from Mr. Froman on how he will, 

if confirmed by the Senate, carry out the duties of the U.S. Trade 

Representative. 

The CHAIRMAN. Thank you, Senator. 

[The prepared statement of Senator Hatch appears in the appendix.] 

The CHAIRMAN. Mr. Froman, before we begin, it is customary for 

us to ask the nominees, if they wish, to introduce their family. 

Mr. FROMAN. Well, thank you very much, Mr. Chairman and 

Ranking Member Hatch. It is my pleasure to introduce my wife, 

Nancy; my children, Benjamin and Sarah; and our caregiver, Gina 

Rodriguez. I will ask the committee’s indulgence. Today is Ben’s 

last day of school, so he may leave the hearing a little early, and 

we will see how long Sarah lasts. But it is my pleasure to have 

them here. 

The CHAIRMAN. Okay. Ben, Sarah, Nancy, do you mind standing 

so we can all recognize you? [Applause.] 

And good luck, Ben, on your last day. Knock ’em dead, okay? All 

right. 

As you know, Mr. Froman, our usual practice is to have your 

statement included in the record. If you just could summarize it in 

about 5 minutes, that would be good. 

STATEMENT OF MICHAEL FROMAN, NOMINATED TO BE 

UNITED STATES TRADE REPRESENTATIVE, WITH THE RANK 

OF AMBASSADOR EXTRAORDINARY AND PLENIPOTENTIARY, 

EXECUTIVE OFFICE OF THE PRESIDENT, WASHINGTON, DC 

Mr. FROMAN. Okay. Thanks, Mr. Chairman, Ranking Member 

Hatch, and all the members of the committee. Thank you for that 

kind introduction, and I am humbled by the confidence that President Obama has shown in me by nominating me for this position, 

and grateful and honored to be considered by this committee. 

I want to just thank my family for all the love and support they 

have given me to make this possibility of service real. 

I also want to thank my parents and recognize how much they 

have meant to me and what they have contributed to me. My mother was an elementary school teacher, a Cub Scout den leader, and 

an active member of the PTA. My father was an immigrant who 

fled Hitler’s Germany, grew up in Israel, came to the United States 

to go to school, built a small business, was president of his Rotary 

Club, and continues to be an important source of guidance and support today. 

My parents taught me the value of hard work and education, the 

importance of giving back to our community, and the privilege to 

serve and work to improve the wider world. I would not be who I 

am today, and I certainly would not be here today, without them. 

7 

In recent weeks, I have enjoyed candid, substantive discussions 

with many of you about trade and America’s broader economic 

challenges. There is a long tradition of close cooperation between 

the Finance Committee and USTR, and that is a tradition I plan 

to continue, if I am confirmed. 

As President Obama has made clear, our number-one goal must 

be to promote growth, create jobs, and strengthen the middle class. 

I see USTR’s role in that effort to be threefold: first, by opening 

markets around the world so that we can expand our exports; second, by leveling the playing field so that our people can compete 

and win in the global economy; and third, by ensuring that our 

trade rights and trade laws that we have worked so hard for are 

fully implemented and enforced. 

I first had the opportunity to work with USTR as a White House 

fellow under President George H.W. Bush, then under President 

Clinton, and over the past 4 years as President Obama’s adviser 

on international economic affairs. It is clear to me that USTR is 

a very special place. 

USTR professionals exemplify the finest traditions of public service. They work hard, they are nimble, they bring intellectual rigor 

to their mission, and they get things done for the American people. 

If confirmed, it would be an honor to lead them. 

As we speak, USTR staff are busy negotiating the groundbreaking Trans-Pacific Partnership. They are consulting with you 

on the upcoming negotiations for an unprecedented Transatlantic 

Trade and Investment Partnership. And, in Geneva, they are working to energize trade liberalization, including on trade facilitation, 

information technology, and services. 

All of these negotiations are designed to strengthen the multilateral, rules-based trading system and press it to achieve its highest 

possible aspirations. If we can conclude these agreements—and let 

me be clear, my view is that it is better to accept no agreement 

than a bad agreement—we will have positioned the United States 

at the center of a network of agreements creating free trade with 

65 percent of the global economy. It is among the most ambitious 

trade agendas in history. 

Trade is also a powerful tool for development, and, if confirmed, 

I look forward to working with you to renew GSP and AGOA and 

to finding innovative ways to facilitate trade and regional integration across the developing world. 

But trade policy can only work if it is fair, and we are committed 

to opening markets, but we are equally committed to enforcing our 

trade rights and trade laws and to helping displaced workers obtain the skills and jobs they need. 

American workers are the most productive in the world. They deserve to compete on a level playing field. This administration has 

made enforcement a top priority: 18 cases brought to date and the 

creation of the Interagency Trade Enforcement Center to enhance 

the depth and reach of our enforcement efforts. 

As with so many things, that could not have been possible without the support of this committee. Trade policy only fulfills its full 

potential when it reflects close consultations between the administration, Congress, and a wide range of stakeholders. 

8 

In that regard, if confirmed, I will engage with you to renew 

Trade Promotion Authority. TPA is a critical tool, and I look forward to working with you to craft a bill that achieves our shared 

goals. 

Let me conclude by making clear that, if given the honor of serving as the U.S. Trade Representative, I will do everything in my 

ability to promote the interests of our workers, farmers, and ranchers; our manufacturers and service providers; our innovators, investors, and consumers. 

Thank you again for considering my nomination. I am happy to 

take your questions. 

[The prepared statement of Mr. Froman appears in the appendix.] 

The CHAIRMAN. Thank you, Mr. Froman. I have four obligatory 

questions that we ask of all nominees. 

First, is there anything you are aware of in your background that 

might present a conflict of interest with the duties of the office to 

which you have been nominated? 

Mr. FROMAN. No, sir. 

The CHAIRMAN. Do you know of any reason, personal or otherwise, that would in any way prevent you from fully and honorably 

discharging the responsibilities of the office to which you have been 

nominated? 

Mr. FROMAN. No, sir. 

The CHAIRMAN. Do you agree without reservation to respond to 

any reasonable summons to appear and testify before any duly constituted committee of Congress if you are confirmed? 

Mr. FROMAN. Yes, sir. 

The CHAIRMAN. This last we have added recently. Do you commit 

to provide a prompt response in writing to any questions addressed 

to you by any Senator of this committee? 

Mr. FROMAN. Yes, Senator. 

The CHAIRMAN. Thank you. 

All right. You have outlined a very ambitious trade agenda, with 

multiple negotiations going forward. Other countries that we are 

negotiating with would like to have some confidence that any 

agreement that you reach, the United States reaches, will be honored. And I am pleased that you personally said you are making 

Trade Promotion Authority renewal a priority and that you will 

engage with Congress to get Trade Promotion Authority passed 

quickly. 

Does this mean the President is himself requesting renewal of 

Trade Promotion Authority? 

Mr. FROMAN. Yes, Mr. Chairman. 

The CHAIRMAN. So the President is asking for TPA to be renewed? 

Mr. FROMAN. Yes. 

The CHAIRMAN. Good, because there has been some question 

about that, and I am glad to hear that clearly stated. 

Next is an opportunity for you to clear the air a little bit about 

your Cayman Islands investments. Would you just tell this committee, describe the fund, how you came to invest in it, taxes paid, 

money earned, et cetera? 

9 

Mr. FROMAN. Thank you, Mr. Chairman. When I was in the private sector, I had the opportunity to participate in an employee 

program to invest in an international fund. I did not invest in the 

international fund because of where it was located. I invested in it 

because it allowed me to diversify my portfolio. 

I am no tax expert. My understanding is this is an investment 

partnership fund where all earnings, all gains or losses, are passed 

on through a K–1 to the individual investors. I have paid taxes, I 

have paid every penny of taxes due on that fund, and I am not 

aware of any tax benefit that I have received by virtue of investment in that fund. 

The CHAIRMAN. If there is any legitimate question about your investment in the Caymans, what might it be? Several have raised 

questions, and, if you could just again tell us that your investment 

is on the up-and-up, and all taxes were paid and nothing of an illegal nature—— 

Mr. FROMAN. Well, again, I am no tax expert, and I cannot speak 

for other activities in the Cayman Islands. All I can say is that, 

with regard to this kind of fund, all the gains and losses of the investments are passed on to the individual investors through a 

K–1. I forwarded that K–1 to my accountant and paid taxes, every 

penny of taxes, due on that investment. 

The CHAIRMAN. Could you talk just a little bit about China? 

There have been a lot of articles lately, and I was particularly 

struck with the article in the Sunday review section of the New 

York Times about how China is very aggressively investing worldwide, and not only direct investment, but loans. In fact, I remember a figure that Chinese loans last year exceeded World Bank 

loans for that year. And there are real concerns that the playing 

field is not level with China, that the United States is more open. 

The Smithfield investment is an example. They are a pork packing 

plant, but China does not take one ounce of beef. It does not seem 

to be too level to me. 

What leverage does this country have, what leverage can you as 

the USTR undertake to help level the playing field? I do not think 

anybody wants to China-bash, but at the same time, we do not 

want to be taken advantage of. Could you just help us and indicate 

to us what your policy would be with respect to China and how we 

get leverage so we are not just talking, we are actually doing something constructive? 

Mr. FROMAN. Well, Mr. Chairman, probably no greater issue is 

on the trade agenda than our relationship with China, because it 

cuts across so many different issues. We have engaged with them 

through all sorts of different mechanisms—bilaterally from the 

highest level, from the President on down, through the Strategic 

and Economic Dialogue, through the Joint Commission on Commerce and Trade, through the G–20, through the WTO, through 

the IMF—to take on the issues that we think, as you say, create 

an unlevel playing field between us. And we are very focused on 

making progress wherever we can, both in terms of pushing for further domestic reform in China on issues like liberalization of their 

exchange rate policy, reform of their financial sector, reform of 

their state-owned enterprise sector, to ensure that our companies 

10 

that are competing against state-owned enterprises around the 

world have a level playing field in which to operate. 

We work also through the enforcement agenda. We have brought 

several cases against China, eight cases against China, over the 

last 4 years—from manufacturing to agriculture to services—at the 

WTO. We brought the only 421 case against China with regard to 

tires, and we see that sector in the U.S. rebounding and more jobs 

created there. 

So we have to use every tool at our disposal, our bilateral, 

results-oriented dialogues, international institutions, but also our 

enforcement mechanisms, where necessary, to ensure that there is 

a level playing field for our workers, our ranchers, and our farmers. 

The CHAIRMAN. Okay. I do not have more time to pursue it right 

now, but I would urge you, once you are confirmed, to spend more 

time thinking about this in an effective way, because the playing 

field is not level, and we have to start standing up for ourselves 

as a country more than we have in the past. That means leverage. 

I believe that no country altruistically, out of the goodness of its 

heart, ever lowers a trade barrier. They do not on their own. They 

only do it if there is leverage, if they have to. And you are going 

to have to figure out a way, working with this committee and other 

relevant committees and other entities, to help figure out what that 

leverage is—again, in a constructive way, but leverage nevertheless. Because, if we leave this unattended, I think it is going to get 

worse. 

Senator Hatch? 

Senator HATCH. Thank you, Mr. Chairman. The distinguished 

Senator from North Carolina needs to leave, so I will defer to him, 

and then maybe get my time back later. 

Senator BURR. I thank my colleague, and, Mr. Froman, thank 

you for coming to my office and for the conversation we had there. 

And I will assure the chair I am only going to ask one question. 

I think it is an easy question, but I do need a specific answer. 

You and I talked at that time about the fact that a poorly negotiated TPP agreement could result in the loss of hundreds of thousands of U.S. jobs in the textile industry or related industries, and 

specifically, in my State of North Carolina, about 35,000 jobs would 

be in jeopardy. So, when we talked last month, you said you understood the importance of the TPP’s textile provisions for the U.S. 

I am going to ask you, if confirmed as the U.S. Trade Representative, will you support the yarn-forward rule of origin to prevent 

countries that do not participate in the TPP agreement from gaining a back-door entry into the market at the expense of those U.S. 

companies? 

Mr. FROMAN. Well, thank you, Senator, and thank you for your 

leadership on this issue. And the short answer is ‘‘yes,’’ and the 

longer answer is we have made clear that, with regard to textiles, 

we would have clear rules of origin with yarn-forward at its center. 

We also need mechanisms to ensure that there is not transshipment. We need to work with our colleagues at other agencies, 

including CBP, to make sure that there are enforcement mechanisms to ensure that people are not using other markets to subvert 

the textile restrictions. 

11 

But, yes, the yarn-forward rule is a central part of our approach 

to textiles. 

Senator BURR. Thank you, Mr. Froman. 

I would yield Senator Hatch back the balance of his time if he 

would like it. 

Senator HATCH. Well, thank you. 

The CHAIRMAN. He can take it all. 

Senator HATCH. That would be great. 

Let me just say this. As you probably know, USTR is an agency 

in crisis. The Office of Personnel Management conducts an annual 

employee survey to evaluate staff satisfaction in Government agencies. A 2012 study found USTR placed last among small agencies 

in effective leadership, as shown by this chart. It was 29th on that 

list, which is disturbing to me. 

You may well tell me that this is a result of constrained resources, but the downward trend in employee satisfaction has been 

continuous since 2009, as you can see by this chart from 

bestplacestowork.org. You can see there from those charts, especially in this case, the score is almost half of what it was in 2009, 

and the steady decline is really concerning to me. 

Now, what in your opinion is required to effectively lead the 

agency? How do you intend to restore staff morale at USTR? 

Mr. FROMAN. Well, thank you, Senator Hatch, and I agree with 

you about the importance of staff morale, and it would be a very 

high priority of mine, if confirmed, to focus on it. 

My experience is that staff tends to have high morale when they 

feel like they are working on something important and that their 

work is valued. And I think the trade agenda that we have been 

discussing this morning and that the President has laid out—with 

regard to TPP, TTIP, the negotiations going on in Geneva, and several of the other initiatives that the building works on—give it a 

sense of mission and give us the opportunity to make improvements in morale. Resources are an issue, clearly, but I think the 

combination of being able to secure adequate resources and focus 

people on the importance of the mission that they have before 

them, and the centrality of that mission to the administration’s and 

the country’s overall economic agenda, will be an important part of 

turning around the line on that chart. 

Senator HATCH. Well, I have a very high opinion of you. You 

come well-recommended, and there is no question about your dedicated service, no question about your intelligence, in my eyes. And 

I am glad to hear today that the President is formally requesting 

TPA. I think it is about time. I cannot imagine any President not 

wanting that. I have been calling for this for many months, and 

your comments today are welcome news, as far as I am concerned. 

And I do look forward to the President’s active support, and he 

can make a lot of headway with me if he will get really active in 

this area, because we are falling way behind. Other countries are 

moving ahead on trade agreements, and we are not. So we are 

counting on you being very energetic, and I do not know how you 

are going to stand to be away from these cute kids you have, and 

your wife, but you are going to have to do it. And we appreciate 

your willingness to serve in this capacity. 

Mr. FROMAN. Thank you, Senator. 

12 

Senator HATCH. Thanks, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator. 

Senator Wyden? 

Senator WYDEN. Thank you, Mr. Chairman. 

I want to pick up on your point, Mr. Chairman, with respect to 

enforcement as we begin, Mr. Froman. You and I have talked about 

this, and I believe strongly that the country needs a vigorous, proactive approach to identifying and remedying unfair trade practices. That is what our businesses deserve. That is what our workers deserve. 

Now, as you know, our solar industry has exercised its rights to 

obtain an antidumping CVD order on Chinese solar products. 

China responded by evading the order and unfairly retaliating 

against our producers in this global solar supply chain. China acted 

similarly with respect to a trade case in Europe. 

Now, as you and I have talked about, our government cannot resolve this on its own. We have to have really a global settlement. 

We have to have an opportunity for governments to discuss this, 

ours and China’s and Europe’s. 

Now, my understanding is, the administration is engaged now 

with those parties—with China, with Europe—to the goal of forging 

an agreement that would end the retaliatory Chinese cases and 

would level the playing field for America’s producers. 

My understanding is that you support those efforts and that you 

are one of the leaders in those discussions. Can you just share your 

views on this? 

Mr. FROMAN. Sure. Well, thank you Senator, and thank you for 

your leadership on this important issue. And it is a critically important issue, because it brings together both the importance of enforcing our trade laws effectively, the importance of seeing the further developments of clean energy, and the importance of leveling 

the playing field so that our producers of clean energy products can 

participate in that growing market. 

It is one of the reasons that we have been so active over the last 

few years in bringing cases related to clean energy involvement. 

We brought a case in the WTO against India’s localization policy 

in the solar area that has kept out our producers. We have brought 

the first section 301 case in 15 years against China for wind subsidies and got China to agree to drop those wind subsidies. And we 

have brought a WTO case against China—— 

Senator WYDEN. Since my time is short, do you support a global 

settlement here? And are you participating—— 

Mr. FROMAN. Yes. I think—yes. On the solar issue, in particular, 

this involves the whole supply chain, as you have said. It involves 

polysilicon makers, solar panel makers, and solar installers. And, 

as you said, it involves not just the U.S. but the European market 

as well. There have been some initial discussions with both Europe 

and China about how to deal with this on a global basis, and that 

would be—I would look forward to working with you to determine 

how to do that in the best way possible. 

Senator WYDEN. If you are confirmed, I want you to own those 

negotiations, because this is a hugely important issue. We have to 

be able to be producers in the renewable energy field. 

13 

* The Protect Intellectual Property Act and the Stop Online Piracy Act. 

Question two is on transparency. As you know, I feel strongly 

about this. We have talked about it. Particularly we saw, in the 

PIPA/SOPA * debate with respect to the Internet, how strongly the 

public feels about this. 

If confirmed, will you make sure that the public, in these areas 

where there is a very significant public interest, gets a clear and 

updated description of what trade negotiators are seeking to obtain 

in the negotiations so that we can make this process more transparent in the future? 

Mr. FROMAN. Yes, Senator. I think it is critically important that 

we have very good transparency and very good consultations between the administration, between Congress, between key stakeholders, and with the public at large. As you know, we brief this 

committee’s staff on every proposal before we table it in any negotiation. We get their input and their feedback. We have a robust 

program of making available to any member of this committee, any 

member of the Senate, any member of the House, the text of negotiating proposals. And we—— 

Senator WYDEN. Let us plan to talk about it some more. I would 

like that to be online so the American people can be a fuller partner in this debate. 

Let me ask you about one other question, since my time is short. 

As you know, genetically engineered wheat was recently discovered 

in an unexpected location in Oregon. The agriculture authorities 

have said that the wheat is safe. As you know, an investigation is 

going on right now. But what I am concerned about is, some of our 

trading partners, unfortunately, have responded by suggesting sort 

of, in the meantime, that they are going to discriminate against 

American wheat imports, and they are going to do it despite a lack 

of evidence that there is a problem with this genetically engineered 

wheat in the stream of commerce. 

What I would like you to tell us is, if confirmed, will you use all 

the tools that you have to stand up for America’s agricultural exports so that they do not face discriminatory treatment in these 

foreign markets? 

Mr. FROMAN. Yes, Senator. 

Senator WYDEN. Thank you. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thanks, Senator. I appreciate your question 

about transparency, because there have been articles recently accusing the administration and USTR of not being transparent in 

trade negotiations, and I think your answer clearly explains that 

these negotiations are fully transparent with respect to members of 

Congress and the staff on what is going on. I encourage you to keep 

that up, because there is nothing worse than the American people 

thinking something is being hidden. I encourage you to keep that 

transparency up. 

Mr. FROMAN. Absolutely. 

The CHAIRMAN. Thank you very much. 

Next is Senator Cardin. 

Senator CARDIN. Thank you, Mr. Chairman. 

14 

Mr. Froman, thank you for your willingness to serve the public. 

We appreciate it. We thank your family. We know this is a family 

sacrifice, and we thank you very much for that. 

I want to first talk about your position on strong human rights, 

labor, and environmental standards as we look at expanding trade 

opportunities. Having stable trading partners is extremely important for us. Good governance is important to have stable trading 

partners. And we have been able to make advancements on human 

rights and on environmental and labor standards through trade 

agreements. 

When the last TPA was negotiated, there were certain provisions 

put into that TPA to guarantee the right to organize, to prohibit 

child labor standards and forced labor standards. We also have environmental issues and other human rights standards. 

I want to know about your willingness to work with us, to use 

every opportunity we have to expand interests that are important 

to the United States. We have the attention of other countries 

when we have trade agreements. At other times, we do not have 

that attention. Are you prepared to work with us to try to advance 

these goals? 

Mr. FROMAN. Yes, Senator. I think we agree that it is very important that we establish and maintain high standards on issues 

like labor and environment and IPR, and a number of other issues, 

through our trade agreements. 

I would broaden it out, however, and say we need to pair that 

with other efforts that we can pursue with these countries, whether 

it is dialogues around human rights or whether it is through things 

like the Open Government Partnership, which really focuses on 

good governance and transparency and anticorruption and accountability. So I very much look forward to working with you on those 

issues. 

Senator CARDIN. And I agree with that, but I would underscore 

this point. In trade agreements, you have opportunities that are 

not available at other times, and the other opportunities we have 

to advance good governance, we need to follow up. But I think we 

have been able to make tremendous strides for the countries when 

we have them at the negotiating tables. And particularly, when you 

look at TPA, you should certainly have the authority, the broadest 

possible authority, to negotiate on behalf of our country. So I would 

just urge you to work with us and be open to opportunities where 

we can advance these goals. 

Mr. FROMAN. Thank you, Senator. 

Senator CARDIN. I want to talk a little bit about TPA. I was in 

Asia this past week. I had a chance to talk to some of the countries 

that are involved in TPP, particularly Japan. But I heard your response to Senator Burr as it relates to the yarn-forward issue, and 

I appreciate that and certainly support that position. 

But let me just point out that there are other issues that are involved here. In Maryland, we have suit manufacturers that are facing very difficult circumstances because of the inverse tariff issues 

on the importation of wool. There is a Wool Trust Fund that we 

need to modernize and move forward. 

Are you prepared to work with us as we look at these trade 

agreements to make sure that we have the appropriate programs 

15 

in this country, such as the Wool Trust Fund, to deal with fair 

competition for U.S. manufacturers? 

Mr. FROMAN. Yes, Senator. We understand the sensitivity of a 

number of those issues, and we look forward to working with you 

on them. 

Senator CARDIN. I appreciate that. 

I want to talk about one other issue which deals with heavy 

trucks. We have Volvo/Mack in Maryland, Mack trucks, which 

makes heavy trucks and is concerned that in the agreements that 

we have with Colombia and Panama, it is a 5-year schedule for the 

elimination of the tariffs. Mexico has moved more aggressively. I 

think it is zero now between Colombia, Panama, and Mexico. The 

agreements also provide that you can accelerate that reduction of 

the tariffs to these other countries. 

Would you be committed to advancing, the best that we can, the 

acceleration of these tariffs, which would certainly help U.S. manufacturers? 

Mr. FROMAN. My understanding is that there is a process for accelerating tariffs and there is a Federal Register notice now out 

asking for comments and ideas from industries that would like to 

see that done. I am happy to look into that, if confirmed. 

Senator CARDIN. I should say accelerate tariff eliminations. 

Mr. FROMAN. Reductions, yes. 

Senator CARDIN. I should make sure we have that clear. Thank 

you. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator. 

Senator Isakson? 

Senator ISAKSON. Thank you, Mr. Chairman. 

Congratulations on your nomination, and your record is outstanding. I wish you the best in your service to the country. 

I have a couple of specific questions of interest to businesses in 

the United States of America. You know, the Trade Representative 

has a unique opportunity to right some wrongs. When you start negotiating with people, you have the opportunity to correct some 

things that have been bad in terms of past practices. And the case 

of Japan entering the TPP negotiation raises a question of great interest to me. 

As you probably know, a number of life insurers in America have 

been working in Japan under agreements with the Japanese government for years to the tune of $66 billion in terms of investment 

interest and life insurance. Japan, through the Japan Post Insurance, has become the major competitor with those life insurance 

companies to the detriment of their business and with preferential 

advantages granted by the Japanese government. 

Will you engage on this issue in the TPP negotiations? Because 

you said your number-two priority was to level the playing field. 

In Japan right now, that playing field has been tilted in favor of 

the government-owned entity, and we need some attention to that 

matter. Will you commit to that? 

Mr. FROMAN. Yes, Senator. And one of the key issues before we 

agreed to let Japan come into TPP was to address insurance access 

issues. We reached an agreement up front on part of that issue and 

also agreed to a parallel negotiation on insurance. So, even beyond 

16 

what is in the TPP agreement, we will try to address the particular 

bilateral issues with Japan in the insurance sector as well. 

Senator ISAKSON. Well, thank you very much for that commitment. I appreciate it. 

When you were in my office, we talked about my interest in Africa and trips that we have made there, in particular what we did 

last year where, at the 11th hour, we finally got the third-party 

fabric extension on the African Growth and Opportunity Act, which 

comes up for renewal in 2015. We really cannot afford to wait until 

2015, until the last minute, to renew the AGOA act. 

What are your plans as U.S. Trade Representative to engage on 

AGOA in terms of timing-wise and in terms of effort? 

Mr. FROMAN. Well, Senator, the AGOA Forum meets in August 

of this year with all the AGOA countries, and, if confirmed, I would 

like to use that as an opportunity to start a process of looking at 

AGOA, looking backwards and seeing what has worked, where it 

could be improved, and then work with this committee—and I appreciate your leadership in particular on this committee and on the 

Foreign Relations Committee with regards to Africa—to make sure 

that there is a seamless renewal of AGOA prior to its expiration 

in 2015. 

Senator ISAKSON. Thank you. And, you know, the chairman made 

reference to China and Africa in his remarks, and this is important 

in that relationship. Where we can trump China is money, and 

China’s investment for their own benefit is to trump us on trade 

with the African people, and that is a rich environment for United 

States products and advanced technology and agricultural products 

and the like. So Africa is an important part of America’s economic 

prosperity in the future, and I think something, as a Trade Rep, 

I hope you will focus on. 

Lastly, my last question is with regard to the free trade agreement with South Korea and the breakthrough language that 

caused criminal penalties to be likened to the U.S. criminal penalties in terms of intellectual property theft. Are you familiar with 

that? 

Mr. FROMAN. I am not terribly familiar with that, no. 

Senator ISAKSON. Well, one of the biggest problems we have had 

with, particularly Asia—I do not want to just pick one part of the 

world—is the theft of intellectual property: going into American 

movie theaters, recording a movie, and then taking it overseas and 

marketing it. The South Korean Free Trade Agreement had a 

breakthrough agreement in there to criminalize that on a parity 

with United States law. Will you work on doing the same thing as 

these other agreements come up? Because intellectual property is 

tremendously important for our business economic growth and industry. 

Mr. FROMAN. Well, absolutely, Senator. We very much agree 

about the importance of intellectual property rights protection, and 

we want to strengthen those protections around the world, including taking on new issues like cyber-theft as part of that, as part 

of the trade secrets issue. So, yes, we will very much work on that. 

Senator ISAKSON. Well, thank you very much, and best of luck 

to you in your new position. 

Mr. FROMAN. Thank you, Senator. 

17 

The CHAIRMAN. Thank you, Senator. 

Senator Brown? 

Senator BROWN. Thank you, Mr. Chairman. 

Mr. Froman, thank you for joining us. I want to talk to you a 

little bit about ‘‘too big to fail’’ and the Trade Representative’s involvement in that. Wall Street and industry-friendly European regulators are now seeking to use any means they can to roll back 

some of the reforms from Basel III and from what we did with 

Dodd-Frank, seeking to include these rollbacks in the U.S.-EU ongoing negotiations, the Transatlantic Trade and Investment Partnership negotiations. The European Finance Ministers, my understanding is, want to stop some of the derivatives rules. Earlier this 

week, the Business Roundtable here advocated that we tie our 

hands, effectively in some ways, unilaterally disarming ourselves 

from addressing ‘‘too big to fail.’’ 

Do we need strong financial rules in these negotiations and to refrain from a race to the bottom? 

Mr. FROMAN. Well, first of all, Senator, there is nothing that we 

are going to do through a trade agreement to weaken our financial 

regulations, to roll back Dodd-Frank, or to roll back the efforts that 

the administration and Congress have worked on for the last 4 

years to reform our financial regulatory system here and to work 

through the G–20 and other mechanisms to raise the standards 

around the world. 

With regard to the Transatlantic Trade and Investment Partnership in particular, obviously financial services are a key part of our 

economic relationship. There are market access issues, and there 

are regulatory issues. Our view is that market access issues should 

be part of a trade negotiation. 

But after the financial crisis of 2008–09, there was an explosion 

of activity among regulators, both bilaterally between the U.S. and 

the EU, but also through the Bank for International Settlements, 

the Financial Stability Board, and the International Organization 

of Securities Commissions. And our view is that that work ought 

to continue parallel, not in the negotiations, but parallel alongside 

the negotiations, towards the resolution of the issues that those 

regulators are working on. And, ideally, at the end of this negotiation, we will be able to look and see across the whole U.S.-EU relationship, what progress we have made towards bringing our economies together. But we are not going to, through our trade negotiation, lower our financial regulations. 

Senator BROWN. You can assure this committee and this Senate 

that in these large-scale regional trade agreements, whether it is 

the U.S.-EU agreement or whether it is the TPP, that we will not— 

you/we will not—undermine any of the financial regulators: FDIC, 

the Fed, Treasury, any of them? 

Mr. FROMAN. Yes. 

Senator BROWN. Okay. Thank you. 

Let me ask something else on the U.S.-EU trade agreement. 

Does an agreement like this, does the Transatlantic Trade and Investment Partnership, need investor-state dispute resolution? I understand the argument for investor-state dealing with countries 

that have not had the history of the rule of law and the history of 

investor protections and public enforcement and all of that. But 

18 

why do we need an—or do we need an extrajudicial and private enforcement system when U.S. and European property rights are as 

sophisticated and are so advanced and protected already? 

Mr. FROMAN. Well, first of all, Senator, we are still in our 90-day 

period of consultations. We have not yet launched the negotiations, 

and we are in the process of taking in input and feedback from 

members of Congress, stakeholders, and others. And so I think this 

is a topic worthy of discussion as part of that consultation process. 

Our goal in all these agreements is to try to establish the highest 

possible standards, and new disciplines where appropriate, to raise 

the overall level of the global trading system. How that gets translated in any particular agreement or in a particular area, I think 

is an issue that we just need to consult on. 

Senator BROWN. Do you think investor-state provisions are fundamentally different in an advanced property rights group of countries like the EU than in a trade agreement we might have signed 

with a Latin American country? 

Mr. FROMAN. Senator, at this point I do not have a position on 

that, because I would want to think about how—while you are absolutely right there may be different legal regimes in one place or 

another, I would want to think about what impact including it or 

not including it might have on our desire to raise the standards 

overall in the multilateral trading system. 

Senator BROWN. Let me ask a question in another direction, Mr. 

Chairman, if I could. A recent study by the Peterson Institute 

found that half or more of excess U.S. unemployment, the extent 

to which current joblessness exceeds the full employment levels in 

the absence of currency manipulation by foreign governments, they 

estimate that up to 5 million jobs are lost as a result of that. The 

National Association of Manufacturers has said it is key the administration spare no effort to see that currencies are marketdetermined and free of government intervention. Two hundred-plus 

House members just sent a letter to the President saying—warning 

against—they were talking about currency disciplines for TPP. 

There is significant sentiment on this committee. There are five 

sponsors—five of the six original sponsors representing both parties 

are on this committee—of my currency legislation, which passed 

the Senate overwhelmingly last year. I think there is a great interest in doing something on currency before we move forward on either fast-track or on TPP. 

What will you do, what will TPP do, to address the kind of currency manipulation which I think unquestionably violates international rules and has gone unaddressed? 

Mr. FROMAN. Well, Senator, first of all, thank you for your consistent leadership on this issue, and this is an issue that is obviously very high on the agenda. It is an example of something we 

raise with China at every meeting on any level with regard to their 

currency policy, and continuously push them to move towards more 

market-oriented exchange rates, to allow adjustments through the 

exchange rate, and to not engage in competitive devaluation. Obviously, the Treasury Department has the lead on such issues, but, 

if confirmed, I look forward to working with them and with all of 

you to determine how best to move forward on that. 

19 

With regard to China, there has been some modest progress. 

When we came into power, came into office, the RMB was pegged. 

In June 2010, after several discussions we had with the Chinese, 

they began to let it appreciate. It has appreciated 16 percent in 

real terms since. It is not fast enough, not far enough. We need to 

continue to press it at every occasion. And we need to find, at each 

step along the way, what the most effective way is to make progress, and we are happy to continue to work on that with you. 

The CHAIRMAN. Thank you. 

Senator Portman? 

Senator PORTMAN. Thank you, Mr. Chairman, and thank you, 

Mr. Froman, for your willingness to step forward and take on this 

responsibility. You were talking about family earlier, and I thank 

your family, too, for their sacrifice, because it is not easy. I had 

three kids under 15 when I had that job, and it does require a lot 

of travel. But, as Bob Strauss warned me—I went around and 

talked to all the former USTRs—he said, ‘‘Do not confuse travel or 

motion with movement,’’ meaning you can do a lot without traveling as well. And I am sure you have figured that out in your current job. 

You have a great team there. It is a terrific team of committed 

professionals. I am very concerned about what Senator Hatch laid 

out, which is a real crisis of morale. You talked about a sense of 

mission you would try to imbue the agency with. I think that is important. 

By the way, it is not just funding, because, when you look at that 

survey, it goes to leadership, and it goes to mission. And I do think 

TPA is part of giving them a mission. In other words, without 

Trade Promotion Authority, which this administration has not 

asked for until the trade agenda this year, you know, it is kind of 

difficult to make progress on these issues. In fact, I would argue 

that, in the 5 years since we have had Trade Promotion Authority, 

the U.S. has fallen behind substantially. Senator Baucus talked 

about that earlier, and, as you know, since you and I have talked, 

it is one of my major concerns that we need to get it done so that 

we can have the opportunity, not just to work on TPP and this 

U.S.-EU agreement, but also make more progress on some of these 

bilateral agreements where we tend to make the most progress on 

reducing barriers. 

So I would ask you, can you give personal assurances to the committee today that you will indeed be involved and engaged in trying to get Trade Promotion Authority through the Congress before 

the end of this year? 

Mr. FROMAN. Senator, absolutely. Again, thank you for your leadership on this issue and your continued support of USTR as an institution. We are ready to engage, and we are ready to work with 

the committee. We would like to get the TPA done as soon as possible. 

Senator PORTMAN. And you will personally engage in that? 

Mr. FROMAN. Absolutely. 

Senator PORTMAN. My understanding is, although it was in the 

March report, there has not been a deep engagement. 

In terms of Japan, following on the question from my colleague 

from Ohio, in terms of currency, a broader issue we have is in 

20 

terms of autos. And, specifically, the U.S. now exports, as you 

know, one vehicle to Japan for every 130 vehicles that we import 

from Japan. And you have probably seen this ad, because it has 

been in a bunch of the papers. I got it out of Roll Call today. But 

it is about the U.S.’s 0.3-percent market share in Japan. It is not 

just about small vehicles, by the way. It is broader than that. It 

is about currency. It is also about non-tariff barriers. 

So I would ask you, how will negotiations with Japan, parallel 

to these TPP talks we are having, address these concerns? What 

are you willing to do in terms of dealing with this currency issue, 

which I think is critical? Let me give you some numbers here. 

Since October of last year, the yen has weakened by nearly 30 percent. It gives about a $6,000 advantage per car to Japanese vehicles. And this is on a $30,000 car. So this is a big deal to the Big 

Three here in the United States, and they are looking for a level 

playing field. 

Can you tell us what you are doing with regard to this issue and 

also other non-tariff barriers as you work with Japan on the TPP 

agreement? 

Mr. FROMAN. Well, thank you, Senator. Absolutely. This is an absolutely important issue as part of TPP, and, before we agreed to 

let Japan join TPP, we engaged in a series of negotiations with 

them about beef, insurance, and, very importantly, autos. We 

reached some agreements up front, both with regard to getting increased access to their market, the more than doubling of what is 

called their Preferential Handling Procedure program for accelerated imports. We also received agreement about how our tariffs 

would be treated in TPP before they joined. And we agreed on 

terms of reference for a parallel negotiation on autos, which are to 

be binding, subject to dispute resolution, and part of the overall 

TPP process. 

And so, we have ongoing work to do with Japan, but we also 

have the TPP process to allow us to do that. 

Senator PORTMAN. Again, we appreciate your assurance today 

you will be personally involved in that. 

With regard to India, quickly, we have a lot of concerns about 

what is going on today in India, especially their emerging market 

access barriers and protectionist measures. One is the lack of respect for patents. You have probably followed this somewhat in 

your current job. Basic intellectual property protections are being 

set aside. They have invalidated and broken American drug patents, as I say. I think these actions are in disregard of WTO rules. 

I think they are fundamentally disruptive to innovation, and I 

think, frankly, it is a major concern, because it could spread. 

In Ohio alone, I would tell you our exports to India have shrunk 

by over 5 percent after years and years of steady growth. So I think 

there is an issue right now with regard to India. I would ask you, 

if confirmed, if you would personally engage with India trade issues 

at what I think is a critical time. 

Mr. FROMAN. Absolutely, Senator. 

Senator PORTMAN. Mr. Chairman, I see my time is coming to an 

end. I have a lot of other questions for you, Mr. Froman, and I will 

supply those to you as questions for the record. 

[The questions appear in the appendix.] 

21 

Senator PORTMAN. But I just want to say again that I appreciate 

your stepping up and taking on this job. It is at a critical time. I 

think there are lots of challenges, but also tremendous opportunities, particularly with the Trade Promotion Authority as a tool you 

can use to open up foreign markets to our workers and our farmers 

and our ranchers. 

Thank you, Mr. Chairman. 

Mr. FROMAN. Thank you, Senator. 

The CHAIRMAN. Thank you, Senator. 

Mr. Froman, I think that is a good point to end on. Since I have 

been on this committee, I cannot think of a more important, challenging time for a new USTR than now. The world has become 

globalized; the challenges are so much greater. The competition is 

so much greater. The need for more creative, effective action is so 

much greater. And I would like you to know that you have the full 

confidence of this committee working with you to accomplish these 

objectives. 

The United States has to work even harder, more creatively, 

than we have in the past, for our kids and our grandkids, if for nobody else, because we want them to have the life that we Americans have had. It will only happen if we rise to the challenge and 

work even harder and better than we have in the past. 

There are some sub-issues here which have been addressed, 

which I just wanted to agree with. One is the IP issue that Senator 

Portman raised. This is becoming more and more of a worldwide 

problem, with China, India, other countries. And I urge you to 

think more creatively than your predecessors have. They have done 

well, but you have to step up and do more. Senator Hatch alluded 

to it. You are extremely well-qualified, you are extremely bright 

and intelligent. You have experience, and you are the man for the 

job, you are the man for the time, and we want to work with you. 

And hopefully that will address another issue that has been 

raised here, correctly, and that is, morale at USTR. I think we can 

address that morale if we go ahead and follow up on what we have 

talked about here today. You are going to find a crack team down 

there. Boy, they just want to really get the job done. And it is up 

to us to help them do that. It is a self-fulfilling prophecy, you know, 

a virtuous circle, et cetera. 

So we will work with you. Work with us and let us know what 

needs to be done, and let us just hopefully get you confirmed right 

away so you can be on the job. 

Senator WYDEN. Mr. Chairman, I see Senator Hatch too. After 

Senator Hatch goes, I had two brief questions additionally, if that 

would be all right. 

The CHAIRMAN. Senator Hatch? 

Senator HATCH. Okay. I just have a few questions regarding 

India that I would like to ask. One of the largest recipients of benefits under the Generalized System of Preferences, if not the largest, 

is India. Yet India increasingly shuts U.S. companies out of its 

market through a variety of measures, including restriction of imports of products to force companies to manufacture in India, forcing companies to give their intellectual property to Indian companies to increase local employment, and, of course, engaging in preferential market access policies to give preferences to domestic comVerDate Nov 24 2008 15:41 Apr 08, 2014 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 R:\DOCS\87359.000 TIMD
22 

panies over U.S. companies in the information and communications 

technology space. 

Now, considering that the administration must consider whether 

India has provided equitable and reasonable market access in determining whether to extend GSP benefits, do you think it is appropriate for India to continue to enjoy GSP benefits when it shuts 

U.S. companies entirely out of its own markets? 

Mr. FROMAN. Well, thank you, Senator Hatch. GSP has multiple 

purposes. Some is for development. Some U.S. firms rely on the imports from GSP countries under GSP for their production. And so 

we need to look at multiple facets of GSP looking ahead. And GSP 

expires at the end of July. I would look forward, if confirmed, to 

working with the committee to renew GSP. But then I am happy 

to sit down as well and talk about what reforms might be appropriate to GSP in the future. 

Senator HATCH. Do you understand what I am talking about 

here with regard to India? 

Mr. FROMAN. Absolutely. Now, with regard to India specifically, 

I think there are a number of concerning developments regarding 

their innovation and investment environment, and you mentioned 

a number of them, including patents. 

Senator HATCH. I am very concerned with the deterioration in 

the environment for protection of U.S. intellectual property rights 

and innovation in India. The government of India continues to take 

actions that make it very difficult for innovative U.S. biopharmaceutical companies to secure and enforce their patents in India. For 

example, I am very disturbed by India’s recent decision to issue a 

compulsory license for an important medicine on entirely specious 

grounds. Also, counterfeiting and piracy continue to be rampant in 

India, and the government’s IPR enforcement efforts remain weak. 

Now, given that negotiations have not borne fruit, what specific 

steps would you take as U.S. Trade Representative to bring about 

improvement in India’s anti-IP policies and practices? And should 

India continue to have access to GSP benefits considering that a 

factor for consideration is the extent to which India is providing 

adequate and effective protection of intellectual property rights? 

Mr. FROMAN. Well, Senator, I think first we should make sure 

we are using our enforcement tools where we can to press India to 

implement IPR protection, and we brought a case, obviously, on localization for solar panels, and we are working with industry to determine how best to address some of the specific issues that you 

raised. 

With regard to GSP, as I said, I think we ought to sit down after 

renewing GSP to think through what kind of reforms make sense 

going forward, including how to deal with issues like this. 

Senator HATCH. Okay. Well, the United States may enter into a 

bilateral investment treaty with India. And, in contemplation of 

such a treaty, would you please let us know, one, how many investment disputes are pending between India and U.S. entities, and, 

two, whether India has been abiding by its investor-state commitments with other nations as well? Could you do that for us? 

Mr. FROMAN. Yes, Senator. 

Senator HATCH. If you will do that, I would be very appreciative. 

23 

Let me just ask one other question. While the online marketplace 

is critically important to our U.S. creative industries, it fails to 

meet its full potential because of rampant online copyright theft. 

As USTR, what additional steps will you take to address copyright 

theft in the online space and to foster legitimate online commerce? 

Mr. FROMAN. Well, this is a key enforcement priority. We made 

the so-called Notorious Markets Report part of our Special 301 

process. Notorious markets we found in China were two such 

websites where there was a rampant counterfeit product being sold, 

and we managed to shut those down. And we wanted to use all of 

our enforcement tools available to us, including the work of the 

Interagency Trade Enforcement Center, to put together cases 

where appropriate, with the consultation of industry, to go after 

practices like that. 

Senator HATCH. All right. Thank you. Let me just ask one other 

question before my time runs out. 

Last February, this administration issued an executive order creating the International Trade Enforcement Center, or ITEC, in 

large part to improve efficiency in bringing trade enforcement actions. It has been nearly 16 months since ITEC was created, and 

I was wondering if you would tell us how ITEC has been working 

and how has its efficiency been improved? Are there any changes 

you would recommend or make that you think would improve 

ITEC’s effectiveness? 

Mr. FROMAN. Well, thank you, Senator. ITEC has gotten off the 

ground and is doing really quite well. It has detailees from several 

other agencies—the Department of Commerce, Treasury, Justice, 

USDA, State, and others. And having subject matter experts, language experts, country experts, all in the same place has allowed 

it to put together cases that we could not have put together before. 

I will mention the export base case against China that we have 

brought in the WTO. They literally had to piece together the puzzle 

of several hundred provincial regulations that showed a picture of 

extensive export subsidies for autos and auto parts. And they 

would not have been able to do that without all those resources 

working together in one place. 

So we are very pleased with the way ITEC has gotten started. 

That is one of several cases that it has managed to put together. 

We are grateful to the Department of Commerce and the other 

agencies for having put up resources and for helping to get it off 

the ground, and we hope, working with this committee and others 

going forward, that it enables it to be properly resourced and continues to strengthen it. 

Senator HATCH. Well, thank you. I will submit my other questions so you can answer them in writing. 

Mr. FROMAN. Thank you. 

[The questions appear in the appendix.] 

Senator HATCH [presiding]. Senator Carper, you are next, I believe, and then I am not sure who is after you—oh, I think it is 

Senator Carper, then Senator Casey, then Senator Menendez. 

Senator CARPER. Senator Casey? Does that sound right, Senator 

Casey? I do not want to get in front of you. Okay. Thank you. 

Thank you, Mr. Chairman. 

24 

Well, I have been off in another meeting on immigration reform, 

and I am happy to be back, and I see that your son Ben and daughter Sarah may have bailed on you? 

Mr. FROMAN. Afraid so. 

Senator CARPER. How old are they? 

Mr. FROMAN. Ben is 11 and Sarah is 21⁄2. Senator CARPER. My boys are now 24 and 23. When they were 

11 or 21⁄2, there is no way they would have even walked in the 

door. So the fact that they showed up with Nancy and you is, I 

think, a compliment to them. 

Our older boy, when he was about 22, right out of college, was 

spending some time in India, in New Delhi, working for about a 

half-year there on clean energy issues and so forth—a really challenging time, but I think ultimately a good experience for him. We 

got to go over and visit with him and learn a little bit more about 

the country through him and through our own time there. 

A number of my colleagues have already raised the issue of 

India. I do not want to pile on with respect to India, but, as you 

are hearing it here today, there are real concerns. They are an important trading partner and a really important nation for us to get 

along well with, work with, and to be our partner in a lot of ways. 

Whether the issue is IT, whether the issue is poultry, there are legitimate issues that are being raised here, and we hope you will 

be very mindful of those. 

The other thing I would say—when people ask me, how do we 

make the economic pie bigger for the United States, I talk about 

investing in three areas: one of those is to invest in a world-class 

workforce; the second area is to invest in infrastructure, broadly 

defined; and the third area is in R&D that can be commercialized 

and create products and goods and services that can be sold all 

over the world. And also to have a tax policy that does the same 

things so we have tax policy working in with our spending policies 

in those three areas. 

Another thing that is really important for us to do, as you know, 

is to make sure that when we do create those products, technologies, or goods and services, we can actually sell them into markets that in some cases are hard to get into. So the job that you 

are taking on here, that you have been nominated for—and I am 

really grateful to you, and I would just say to your wife and your 

kids, thank you for letting him do this and for sharing him with 

our country. I was very impressed when I met with your husband, 

Nancy, and he said, ‘‘You think I am smart? You should talk to my 

wife.’’ But we are grateful for that. 

I have a question that relates to enforcement, and I obviously believe, as I think we all do, that trade can be an effective tool to 

level the playing field so that our businesses can compete in global 

marketplaces. However, enforcing the rules on the books is essential to fair trade and to competition. 

This administration, under the leadership of Ambassador Kirk, 

took steps to ensure that strong enforcement was a key component 

to the trade agenda. And I would just say, at a time when the U.S. 

poultry industry—the reason why I am interested in poultry is, 

there are 300 chickens for every person who lives in Delaware. I 

think the same might be true in Maryland and some other States 

25 

as well. But it is a big deal for us. But, at a time when the U.S. 

poultry industry sees key markets close as a result of unscientific 

non-tariff barriers this year, year after year, can you assure us that 

the USTR under your direction will continue the important work 

of enforcing the rules on the books? 

Mr. FROMAN. Yes, Senator. Enforcement has been a priority for 

this administration. We have brought 18 cases to date, including 

several in the agricultural area, including some in poultry—against 

India for their avian influenza restriction, against China for some 

of its inappropriate use of AD/CVD laws against our poultry exports. And we will continue to focus on those as we move ahead. 

Senator CARPER. Well, good. And a related question is, at the 

same time, can you ensure us that you and the folks you would 

lead will work to address existing barriers for our poultry industry 

through agreements, particularly the Transatlantic Trade and Investment Partnership that we are working on? 

Mr. FROMAN. Yes, Senator. We have made clear to our trading 

partners that agriculture and SPS issues in particular, the sanitary 

and phytosanitary standards that are often used as trade barriers, 

need to be addressed through these agreements. We have made 

some progress in the run-up to the negotiation through some 

confidence-building measures, and, as we complete the 90-day consultation period, certainly this will be on the agenda. 

Senator CARPER. Good. And one last question. I was here for 

your testimony before I had to leave, but I want to come back— 

others may have already asked this question, but, in terms of what 

we can do to help you and the folks at the Trade Representative 

Office be more effective, could you provide just a short to-do list, 

please? 

Mr. FROMAN. Well, Senator, thank you for the offer. I think, on 

many of these issues, whether it is TPP, TTIP, getting TPA, the 

Geneva negotiations, ensuring that USTR has the support that it 

needs, we very much look forward to working with this committee. 

Working very closely between USTR and this committee has been 

a long tradition, and we plan to continue it. 

Senator CARPER. All right. Thanks. 

Mr. Chairman, I would just like, for the record, to indicate that 

I could barely see Mr. Froman’s wife’s lips move when he spoke, 

and his assertion that actually she is much smarter than he was 

probably well borne out. [Laughter.] 

But we are grateful to you, Nancy, for sharing him with us and 

our country. Thank you for your willingness to serve. 

Senator HATCH. Thank you. 

Senator Casey? 

Senator CASEY. Thanks very much, Senator Hatch. 

Mr. Froman, thanks for being with us today, and thanks for your 

willingness to serve. It is a great commitment you are making, and 

your family, so we appreciate that. 

I wanted to ask about two areas. One is on the question of TPP 

and Japan and our debate about autos. But I wanted to start with 

a question about competitiveness and intellectual property. We 

know, we all know, the advantage that we have had for a long period of time now because of our great biopharma industry here, and 

we rely upon the IP, the intellectual property, that undergirds that 

26 

advantage we have. And I know it is of great concern to the administration and, frankly, people in both parties, but there is a real 

concern that, going forward, we are not going to have the kind of 

protections that we should have for our own intellectual property. 

You have seen numbers like this, and, when it comes to a par- ticular product, sometimes it can cost as much as $1.3 billion of investment on average and 10 to 15 years of work to develop it. So 

I want to make sure we have as strong a set of protections as possible, and we have, I think, fairly broad-based agreement on as 

long a term as possible of data exclusivity, a 12-year consensus, I 

would argue. 

I just wanted to ask about your work as Trade Representative 

upon confirmation. Will you work to make sure that we have those 

kinds of protections in place for that term of years? 

Mr. FROMAN. Senator Casey, I fully agree that our innovation 

and ingenuity is an absolutely central part of our comparative advantage as a Nation and of our economy, and we need, through our 

trade agreements, to ensure that we are protecting our intellectual 

property to the highest possible standard. And through TPP, as one 

example, we are working to ensure that there are high standards 

for intellectual property protection, and we have begun that process 

with our TPP partners of explaining to them what is in U.S. law 

with regard to data protection and biologics and how it works and 

why it is in there, and that is part of an ongoing discussion that 

we are having with them now. 

Senator CASEY. I would urge you to embrace, I think, what has 

been a pretty strong consensus here, and I think throughout the 

country, on the maximum protection possible. And the second question is one I know that you have addressed, if not directly today, 

certainly it has been raised, and that is the question of Japan and 

the auto industry and whether or not, after many years of efforts, 

we can open up the Japanese auto market. We have had, in my 

judgment, years of frustration, which I think creates kind of a 

predicate for skepticism when it comes to TPP and whether or not, 

with TPP in place, we are going to have the kind of access to the 

Japanese market as it relates to autos. I wanted to get your views 

on that, because I think it is a major issue for a lot of people here 

as it relates to, not just TPP, but broader trade policy. 

Mr. FROMAN. Well, Senator, first of all, I do not think there is 

anybody who cares more about the health of the U.S. auto industry 

or is invested more in the health of the U.S. auto industry than 

President Obama and this administration. And certainly the direction that I have received from him is to ensure that what we are 

doing through TPP gives us the opportunity to protect the gains we 

have made in the auto industry, in terms of getting it back on its 

feet, and gives us the opportunity to build on that strength going 

forward. And that is why we have made autos such a central focus 

of ours in the run-up to Japan’s proposed entry into TPP. It is why 

we agreed on certain provisions that would give us more immediate 

access to their market as well as deal with our own tariffs in the 

context of TPP, on a terms of reference agreement for how to deal 

with auto issues going forward, including both offensive issues 

around distribution but also enough defensive measures here as 

well. So that is very much a part of this overall effort. 

27 

Senator CASEY. I am out of time, but I would just, for the record, 

say there is a lot of skepticism about the ability to open up those 

markets, and we look forward to working with you on it. 

Mr. FROMAN. Thank you. 

Senator CASEY. Thank you. 

The CHAIRMAN. Thank you, Senator. 

Senator Menendez? 

Senator MENENDEZ. Thank you, Mr. Chairman. 

Mr. Froman, as we had the opportunity to discuss, you are going 

to hear one consistent issue that I will raise today, and that I will 

raise upon your confirmation and as you are in the job, and that 

is intellectual property rights protection. The United States is a 

global leader in this respect, and, if we create, through the intellectual capacity of our Nation, products, and then they can be subverted worldwide, it is really an undermining of a significant part 

of our economy. 

To the extent that some of us are willing to put votes on trade 

agreements, it is because we believe that the enforcement provisions that we provide to ensure that the agreement is going to put 

us on a level playing field will help us compete against anybody in 

the world, but not if they have disproportionate standards, standards that we live up to but they do not. And, certainly, the impact 

of our trade agreements in both national security and economic interests, those are my three baskets of concern. 

Upstairs I am chairing a Senate Foreign Relations hearing on 

one of the worst tragedies that we have had in the manufacture of 

clothing, which is the Rana Plaza tragedy. And I asked representatives, including of the department you would head, how many more 

lives have to be lost before we act? It is my understanding that 

there has been a petition before USTR reviewing labor rights 

issues in Bangladesh since 2007. That is 6 years. And we have seen 

no real progress. 

So I would appreciate hearing how you plan to leverage, should 

you be confirmed, the positions you have, including with GSP, to 

encourage countries like Bangladesh and others to improve their 

safety and worker rights efforts. 

Mr. FROMAN. Well, thank you, Senator, and thank you for your 

leadership on that issue in the other committee as well. The tragic 

loss of life in Bangladesh is very much high on the agenda. As you 

note, there is a petition pending before USTR, and my understanding is that USTR intends to act on that over the course of this 

month, that there currently are interagency discussions about how 

best to proceed. 

So, if confirmed, this is something I very much look forward to 

delving into and working with you on. 

Senator MENENDEZ. Well, my concern is, it has been 6 years. Six 

years. Maybe had we acted, we would not have seen those people 

die, because standards would have been raised, conditions would 

have been improved, labor rights would have been observed. And 

so, I hope that what we will get from you is, when it is merited, 

a robust effort and a recommendation—only the President, of 

course, can make that ultimate decision, but you are going to be 

in a key position to make a recommendation. And so, I hope you 

are going to make that type of recommendation. 

28 

Secondly, on intellectual property rights, I do not mind piling on 

as it relates to India, because they are piling on U.S. companies as 

it relates to their intellectual property rights. And I have been 

hearing from the pharmaceutical industry, I have been hearing 

from the high-tech industry, I have been hearing from other industries, about how India’s inadequate protection, to put it mildly, and 

enforcement of intellectual property rights is a real challenge. 

For example, in the pharmaceutical industry they say, well, it is 

really about access. Well, it is not about access, because they could 

observe the patent and negotiate prices. So it is about protecting 

their generic industry at the expense of the intellectual property 

created in the United States to create global medicines that save 

lives and improve the quality of lives. 

So I would like to hear from you how do we, in fact, intend to 

enforce IP rights? India is only the present example, but there are 

others, like China. You know, we have a company in New Jersey 

that produces the scientific manuals for the U.S. and across the 

world. Their product has been, with impunity, taken by the Chinese. 

If countries see no consequences and begin to emulate India’s actions on our most innovative sectors, we face serious problems. So 

what actions can the administration take and you, in your position 

upon confirmation, to convince, for example, India to ensure that 

the fruits of American innovation are protected? And what do you 

plan to do as the Trade Representative? 

Mr. FROMAN. Well, thank you, Senator. We are very concerned 

about the innovation and the investment environment in India at 

the moment, and you mentioned some of the issues: compulsory licensing, patent issues, preferential market access, localization. 

These are issues we need to pursue at every opportunity. Secretary 

Kerry will be there later this month for an interagency strategic 

dialogue at the highest levels in India. I am sure it will be brought 

up there. We will have another opportunity in July when some Indian officials are here. And ultimately, as you point out, it comes 

down to the possibilities of enforcement as well. We have brought 

cases against India in the WTO, and we have thought that would 

be the best way to resolve issues. And we are consulting with industry to determine how best to proceed in these cases as well. 

Senator MENENDEZ. If I may, Mr. Chairman, one last question. 

You are very erudite on these issues. I have no doubt about that. 

Also, I think you are also very diplomatic in your responses. I want 

to see a Trade Representative who, at the end of the day, is going 

to stand up for U.S. intellectual property rights worldwide so that 

the benefits of the creative abilities of Americans can be preserved 

worldwide, and they can receive the resources from them them. 

So I hope your diplomacy will have limits, because, at the end 

of the day, we have diplomatically been losing a lot of ground 

across the globe, and that is not in the interests of U.S. companies, 

U.S. citizens, and, at the end of the day, our economy. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you. Thank you very much, Senator. 

Senator Thune? 

Senator THUNE. Thank you, Mr. Chairman. I want to thank you 

and the ranking member for holding this important hearing today. 

29 

And, Mr. Froman, thank you for your willingness to come up and 

answer our questions. 

We all know trade is an incredibly important part of our economy 

and extremely critical when it comes to improving America’s competitive position in the world and maintaining a high standard of 

living. And I know you, I think, have talked about this already, 

but, in my view, one of the best things that we can do to open new 

markets would be to successfully conclude the Trans-Pacific Partnership and the other agreements that will follow. But, in order to 

do that, we need to enact updated TPA, Trade Promotion Authority. And I am heartened by your testimony that this is something 

you intend to engage with, with the committee, if confirmed—to 

renew TPA. 

I understand that the chairman got a formal request today for 

that. Is that right? I hope so, because we have been saying for 

some time this is really important, and there is a lot of rhetoric 

about it, but until there is a request that comes forward, it is very 

difficult for us to act. So I hope that is the first order of business. 

I want to ask you a question about something that is important 

to a lot of the agricultural producers in my part of the world, and 

it has to do with—there was a letter I recently spearheaded to the 

U.S. Acting Trade Representative, along with 13 other Senators, 

expressing our strong concerns about the EU’s recent decision to 

impose a 10-percent duty on all imports of ethanol from the United 

States. American ethanol producers believe that what the EU has 

done in imposing a countrywide antidumping duty on all U.S. ethanol imports is both unprecedented and unsupported from a legal 

standpoint, and that it will completely close the EU to American 

ethanol. 

The question is: will you commit, if confirmed, to carefully reviewing the EU’s action on ethanol? And will you pursue every 

available remedy to ensure that U.S. ethanol exporters are treated 

fairly by the EU? 

Mr. FROMAN. Yes, Senator. 

Senator THUNE. And are you familiar with that issue? 

Mr. FROMAN. I am, and my understanding is that USTR is reviewing the methodology that the EU used in that case, precisely 

for the reasons you cited. 

Senator THUNE. Okay. I wanted to ask one other question, because this is in the news this week. But earlier this week, the 

President recommended a number of legislative actions to strengthen the enforcement of patents, and these recommendations included reforms to the process by which the ITC issues exclusion orders. We all know that there have been some high-profile ITC decisions recently. Without commenting on any particular decision, the 

question is: Do you believe that the current ITC process needs reform? And if so, why? 

Mr. FROMAN. Senator, I am not an expert in that area, but I am 

happy to get back to you on it. 

Senator THUNE. Okay. I would appreciate it if you could. 

[The information appears in the appendix on p. 113.] 

Senator THUNE. Do you have any comments on the U.S.-EU 

trade agreement or TPP? 

30 

Mr. FROMAN. Well, on the U.S.-EU trade agreement, we are still 

in our 90-day consultation phase with Congress and stakeholders. 

But we think there is great potential there, both to remove barriers, tariff barriers, non-tariff barriers, and to address some of the 

regulatory and standards issues that create unnecessary costs and 

obstacles to trade. We spent the last year, year and-a-half, working 

with the EU to identify what the key outstanding issues are, and 

we think there is a lot of momentum over there and a lot of political will to address those outstanding issues. So, once we finish the 

90 days and they finish their mandate process, if successful, we 

look forward to launching those negotiations. 

Senator THUNE. I would like to just address one other issue, if 

I could, and that is the importance of protecting trade secrets in 

trade agreements, particularly as we look to the EU negotiations. 

As you know, trade secrets, which generally include any confidential business information such as manufacturing processes, are an 

extremely valuable asset to American companies. Unfortunately, 

theft of trade secrets, especially by or for foreign entities, has dramatically increased due to greater global competitiveness and increased access to information through the digital infrastructure 

that drives our information economy. So I am wondering if you 

could comment on that and what additional steps might be able to 

be taken to protect American trade secrets. 

Mr. FROMAN. Thank you, Senator. It is an important issue. It is 

sort of the next generation of IPR protection, where you have trade 

secret theft, and now, of course, cyber-theft as well is one of the 

tools by which trade secret theft goes on. There is an administration-wide strategy on dealing with trade secret theft, and part of 

what we are trying to do, through our trade talks and our bilateral 

dialogues with countries, is ensuring that they have in place the 

necessary civil and criminal penalties as well so that we can go 

after these practices. And that will certainly be a focus going forward. 

Senator THUNE. All right. I appreciate that. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator. 

Senator Wyden? 

Senator WYDEN. Thank you very much, Senator Baucus. 

Let me ask first a question about footwear and the global value 

chain. You all are pushing for a 21st-century or next-generation 

agreement, which certainly sounds constructive to me in a number 

of chapters. And I also want to see you all, as part of that, avoid 

some of these outdated provisions that would undermine the momentum needed to reinvigorate the global economy. This requires 

that we particularly look at the global value chain, research considerations, all of the issues that go to the global value chain that defines the operations of so many brands. 

If confirmed, will you make sure that, as part of that process, as 

part of the Trans-Pacific Partnership negotiations, you look at 

some of the key areas that relate to this concern, like the rules of 

origin and the tariffs for consumer goods? 

Mr. FROMAN. Yes, Senator, we will look at all those issues. 

Senator WYDEN. Good. The other question I had deals once again 

with the Internet. You know, my view is that the Internet is the 

31 

shipping lane of the 21st century. It has enormous benefits to people on a day-to-day basis, but it is also reshaping the manner in 

which commerce is conducted. But there are not, as of today, any 

distinct global trade rules that ensure that digital trade does not 

face protectionist kinds of policies, protectionist discrimination. 

And there is a lot of concern, for example, about the big win that 

was won on the PIPA/SOPA issue sort of being unraveled as part 

of these discussions. 

What can you all do to make sure that the digital economy gets 

the attention it needs to ensure that the Internet is free and open 

in global markets, particularly for American producers of digital 

goods and digital services? 

Mr. FROMAN. Well, Senator, when we talk about the TPP being 

a 21st-century agreement and trying to introduce new disciplines 

for new issues in the global economy, the digital economy is clearly 

one of those areas, one of those new areas that we have been focusing on. And so in the TPP negotiations, while we are still in the 

midst of the negotiations, we are seeking the free flow of data; we 

are seeking disciplines around restrictions that countries might 

have in terms of where people put their data centers and how this 

affects cloud computing. So it is very much on the agenda. The 

e-commerce and the digital economy are very much on the TPP 

agenda. 

Senator WYDEN. One last question. On the TPA renewal question, are you all going to send to us a proposal that represents your 

views on what TPA is all about? Or how do you envision that unfolding? 

Mr. FROMAN. Well, Senator, obviously I will need to consult with 

USTR and others, if confirmed, but our intention is to engage with 

this committee and engage with the House Ways and Means Committee as you work through TPA issues. 

Senator WYDEN. So you would send the chairman, Chairman 

Baucus, and Senator Hatch—you would, in effect, send us your 

statutory negotiating goals so that we can get a sense of what your 

priorities are? 

Mr. FROMAN. I think we will have to work through what form 

that engagement takes, but we are happy to engage with you. 

Senator WYDEN. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator. 

Senator Brown? 

Senator BROWN. Thank you. Thanks very much for this second 

round, Mr. Chairman, and for sitting through this. And, Mr. 

Froman, thank you for that too. 

We talked on the phone about the issue of state capitalism. State 

capitalism in the market is distorting behavior of state-owned enterprises, and we know that is an increasing problem in terms of 

these deeply entrenched state capitalism models, if you will, and 

the impact of them on U.S. competitiveness. This is a big issue, one 

that Congress really did not think much about when we considered 

fast-track 11 years ago and one that we should think about now. 

Can you assure me that there will not be backtracking on the 

whole issue of state-owned enterprises the further we get into TPP 

negotiations, that we will have strong and forceful rules in the TPP 

context to address SOEs? 

32 

Mr. FROMAN. Yes, Senator, that is certainly what we are seeking. 

That is one of those new areas, again, of trade that we are trying 

to address through TPP, putting disciplines on SOEs that compete 

with private entities, that they must do so on a commercial basis. 

It is also part of our bilateral dialogue with the Chinese in particular, outside of TPP, obviously, about their SOE reform effort 

and how important that is to leveling the playing field for our companies. 

Senator BROWN. So you are, in an ongoing way, in bilateral investment discussions with China? This is the main part of the 

agenda, the SOEs? 

Mr. FROMAN. Yes, sir. 

Senator BROWN. Okay, good. I want to talk to you about the steel 

industry for a moment. A company called RG Steel, with plants in 

Ohio, West Virginia, and New York, closed about a year ago. Several thousand people lost jobs. This is an industry, the steel industry is an industry, more than most, operating on very thin margins, 

2-, 3-percent profit, partly because of a trade decision made by the 

administration, ITC, Commerce Department, over the last 3 or 4 

years. There’s a new steel plant now called Vallourec in Youngstown. There is a $100-million expansion at Lorain Works of U.S. 

Steel, which I visited with the CEO, Mr. Surma, last week. There 

is other steel investment. 

The problem is the negative business environments. We are seeing that the narrow margins are in large part because of increased 

imports of steel products resulting from government subsidies and 

unfair trade practices, often Chinese, sometimes others. 

If confirmed, would you file a case at the WTO against China’s 

steel subsidies? 

Mr. FROMAN. Well, Senator, I think we need to take a look at the 

whole set of issues, and I do not know whether there is a case to 

be brought at the moment or not on that. I would say that we 

brought a case against China in the steel sector when they put on 

our grain-oriented electrical steel AD and CVD duties in an inappropriate way, and we won that case. And we are always looking 

to find mechanisms for dealing with issues of unfair trade practices 

through our trade enforcement laws. 

So it is certainly something the ITEC can look at, and, if there 

is a case to be brought, they will bring it. 

Senator BROWN. Well, thank you. My fear is this: that so often, 

by the time we go through this process, if we do not act a little 

more proactively or peremptorily, if that is an adverb, the damage 

to these businesses—we saw it in the paper industry in southern 

Ohio and all across paper manufacturing generally, where the damage to the industries was so great, by the time that the wheels of 

government in trade enforcement could operate, these companies 

and this industry really had it and probably will never fully recover, and they have not recovered appreciably anyway. So I am 

hopeful that you will look at this in a bit more proactive, preemptive way as you decide this. 

Lastly, I just wanted to make the invitation to you—and I am 

sure my colleague from Ohio on the Finance Committee, Senator 

Portman, would like to too—to come out to Ohio and see a steel 

plant. I think you seeing steel being made, and its importance in 

33 

the economy in making things and being a leader in everything 

from national security to security of families that make steel, 

would matter so much. 

And I would end with this. There is an ArcelorMittal plant in 

Cleveland which is the first time in world history where 1 personhour produced 1 ton of steel. It had never happened in world history anywhere, and it happened first in Cleveland, OH. So you 

have a really efficient domestic steel industry that is under a lot 

of pressure because of dumping and because of illegal subsidies to 

Chinese steel. 

Mr. FROMAN. I look forward to taking you up on that invitation. 

Senator BROWN. Thank you. 

The CHAIRMAN. Thank you, Senator. 

Mr. Froman, you have heard a lot of concerns here. They generally revolve around unlevel playing fields, intellectual property 

infringement, state-owned enterprises unfairly taking advantage of 

U.S. companies, and so forth. My question really is—I know you 

are going to try to address a lot of this, and other matters that 

have not arisen. What are the limits on your power to address this? 

What are the limits? What are the political limits? What are the 

legal limits? What is preventing you from more forthrightly and aggressively addressing all these issues in a very expeditious way? If 

you could just categorize what they are, and I am especially interested in potential legal limits. The United States could bring unilateral actions before we joined the WTO. That ability to do so is 

now severely restricted. Now, there are some who would say that, 

well, gee, we get a lot out of it. Other countries have joined, and 

they have those disciplines, although other countries have not fully 

joined the WTO and participated in those disciplines. I will start 

first with the legal limits. What can you do and what can you not 

do? 

Mr. FROMAN. Well—— 

The CHAIRMAN. First of all, what are the limits? If you could do 

everything—that is where I start out. If you could bring any action 

on any subject to address all that has been talked about here, what 

are the limits? 

Mr. FROMAN. Well, Mr. Chairman, that is a great question that 

deserves a more thoughtful answer. I will start today, but it is 

something that I would love to continue the dialogue with you and 

others about. 

You know, I think we benefit greatly—we, the U.S., benefit 

greatly—from the rules-based trading system. The WTO may constrain our ability to bring unilateral action, but it constrains everybody else’s ability too. And the dispute resolution mechanisms of 

the WTO have generally been open and fair, and we have aggressively pursued our interests through them. 

So I do not know whether we need additional legal authorities 

than what we currently have. I think we need to be able to get out 

there with our trading partners to build coalitions with other likeminded countries and to do things that help underscore that. For 

the global trading system as a whole, it will be better if countries 

all play by the same rules, and those rules are the sort of rules 

that undergird the current WTO system. And that is what we need 

to do bilaterally with the emerging economies, as they arise and 

34 

play an increasing role in the global economy. It is what we hope 

to do through the Transatlantic Trade and Investment Partnership: 

not only open our markets to each other but work together vis-a`- vis the rest of the world to help raise standards in IPR and other 

areas. So there is a lot to be done in that regard. 

The CHAIRMAN. So you do not think you need any more legal authority? 

Mr. FROMAN. Well, I am happy to think through that, but I know 

enough to know that I should not be my own lawyer on this one. 

The CHAIRMAN. All right. But I think we need to discuss this, 

and I urge you to think about it. You know, it is my belief, and 

I think it is America’s belief, it is certainly the belief of members 

of this committee, we are not simon-pure. We have some trade barriers too. And other countries are not Darth Vader. They do not 

have black hats. We do not have white hats; they do not have black 

hats. But I think it is also true the shade of gray of our hat is a 

lot lighter than the shade of gray of their hats, by and large. And 

so the playing field is really not level. Do you want other countries 

to play by the same rules? A lot of countries do not want to do that. 

They are not rules-based, as much rules-based, as we are as a 

country. 

You know, we are rooted in—our Founding Fathers came over, 

drafted a durable Constitution and Bill of Rights that are based in 

justice and fairness and procedure and transparency, and the assumption that democratic countries work with the form of government that we have. That is not true in most other countries. They 

do not have that same foundation. They do not have that same 

basis. They come from much different perspectives. Many countries 

are much less process-oriented, they are much more resultsoriented. 

The United States is process-oriented. We believe in rules and 

being fair. That is not true with other countries. And they will not 

be fair in the U.S. view because that is not where they come from. 

And the only way to address those issues, in my judgment, is leverage. You have to figure out some way to make them—that is a bad 

choice of words, but some way so they want to play fair. Or, if they 

do not, we have to adjust to another world order where justice and 

fairness may not be the total underpinning, might not be our 

premise, our assumption, of what we are trying to accomplish here. 

I am worried about results very much. We Americans regard ourselves as fair, you know: the right process, judicial process, separation of powers, independent judiciary, et cetera. But we also need 

results. And the world has changed so dramatically in the last 10, 

15, 20 years. With globalization and advances in communications 

technologies, that has undermined, I think, all institutions. We 

have to think a lot differently than we have in the past if our kids 

and grandkids want the same quality of life that we have enjoyed 

as Americans. 

I am very worried about that, and I know you are too. Just so 

you have a sense here, the Senators are going to ask you followup questions in the future, to what degree have you performed in 

the areas that they have addressed. They do not just want to hear 

more talk. They do not want you, when they talk to you again 

about this—and I am one of them—to come back and say, well, gee, 

35 

we talked about a lot of this, but we did not do very much about 

it, and it is not much better really. And that is why I ask the question. What are the limits to your power? What do we need to address so that you have more power, actually, with respect to our 

trading partners so we can get better results? I just urge you to 

think very deeply about that. 

I will talk to you later. We will have follow-up discussions about 

this. But I think it is one of the central questions facing this country: economically, how do we make sure that we are not being 

taken advantage of by some other countries? And how do we make 

sure that we Americans have an even higher quality of life than 

we have had in the past? 

Mr. FROMAN. Well, I agree completely, and I very much look forward to working with you and your colleagues on that. 

The CHAIRMAN. I wish you very well. It is a huge challenge. I 

sometimes think that only the paranoid survive. And I hope you 

are paranoid so that you can help America survive. 

Thank you very much, Mr. Froman. 

Mr. FROMAN. Thank you, Mr. Chairman. 

The CHAIRMAN. The hearing is adjourned. 

[Whereupon, at 12:55 p.m., the hearing was concluded.] 

(37) 

A P P E N D I X 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD


87359001.eps
38 


87359.002

These trade policies will make a difference here at home. As a group, the TPP countries are the largest 

international market for U.S. goods and services. Last year, U.S. exports to current TPP countries totaled 

nearly $620 billion, representing 40 percent of total U.S. goods exports. 

And breaking down trade barriers in TPP countries will make a real difference. Japan relaxed its beef 

restrictions earlier this year, and our beef sales are almost 50 percent higher. Japan's average 

agricultural tariffs are more than 20 percent, while ours are only five. When those tariffs come down, 

our sales will go up. 

And the Transatlantic Trade and Investment Partnership will also stimulate economic growth and job 

creation. The European Union purchased close to $460 billion in U.S. goods and services last year, 

supporting 2.4 million American jobs. A comprehensive agreement that tackles long-standing regulatory 

and agricultural barriers could add even more jobs here at home. 

My home state of Montana shows how critical an ambitious trade agenda is to good-paying 

jobs. Montana's manufacturers, farmers and ranchers rely upon open markets to create and maintain 

jobs. In fact, one in six manufacturing jobs in Montana comes from exports. In the last decade, 

Montana's goods exports to FTA partners have increased by 248 percent. Last year Montana's wheat 

growers exported 65 percent of their crop. 

Because of the tireless efforts of U.S. trade negotiators, ranchers from Clyde Park can now export 

American beef to Korea, and farmers from Churchill can export American seed potatoes to Congo. We 

must fulfill the promise of our ambitious trade agenda. Confirming Mike Froman quickly must be the 

first step, but we're not done there. The next step must be to pass Trade Promotion Authority and 

Trade Adjustment Assistance. 

With so many trade initiatives moving to completion and getting off the ground, we need TPA now to 

guide and support USTR. And we need TAA to ensure that our workforce remains ready to compete 

with anyone, anywhere in the world. 

I am pleased that the Administration supports TPA and worker assistance. Mr. Froman, I look forward to 

working with you to renew TPA and TAA in the next few months, so that we can lay the groundwork for 

a successful trade agenda. I will continue my efforts to introduce a bipartisan TPA bill this month. 

Finally, I'd like to emphasize that the USTR must continue to harness the resources and energy of the 

entire U.S. government for our trade agenda to be successful. It must continue to be headquartered at 

the White House, and the U.S. government must continue to pull together behind USTR's leadership. 

The President's ambitious trade agenda will require nimble thought and nimble action. And I am 

confident that with Mike Froman at the helm, USTR will meet the ambition that the President has 

set. Mr. Froman, Members of this Committee will ask you tough questions today. That is our right and 

responsibility. 

Mr. Froman, over the past several years, you have shown that you are willing to go the extra mile, over 

land and sea, to get the best deal for U.S. farmers, ranchers, businesses and workers. I believe you will 

serve ably as the next U.S. Trade Representative. I look forward to our discussion today. 

### 
39 


87359.003

Michael Froman 

Nominee for United States Trade Representative 

Opening Statement 

Senate Finance Committee 

Confirmation Hearing 

June 6,2013 

Mr. Chairman, Ranking Member Hatch and Members of the Committee, thank you for your 

generous introduction. I am humbled by the confidence President Obama has placed in me in 

nominating me to be the U.S. Trade Representative, and I am deeply honored to be considered 

by this Committee. 

I'd like to begin by recognizing my wife, Nancy, and my children Benjamin and Sarah, who are 

here today. I want to thank all of them, and particularly Nancy, for the love and support which 

has made it possible for me to serve. 

I also want to thank my parents and recognize how important they've been to me. My mother 

was an elementary school teacher, a Cub Scout den leader and an active member of our 

PTA. My father was an immigrant who fled Hitler's Germany, grew up in Israel, and came to 

the United States to go to college without much English and just a hundred dollars in his pocket. 

But he built a small business, was president of his Rotary Club, and continues to be an important 

source of guidance and support. 

My parents taught me the value of hard work and education, the importance of giving back to the 

community and the privilege to serve and work to improve the wider world. I would not be who 

I am, nor would I be here today, without them. 

In recent weeks, I have enjoyed candid, substantive discussions with you about trade and 

America's broader economic challenges. There is a long tradition of partnership between the 

Finance Committee and USTR. It is a tradition I plan to continue if I am confirmed. 

As President Obama has made clear, our number one goal must be to promote growth, create 

jobs and strengthen the middle class. I see USTR's role in contributing to this effort to be 

threefold. 

First, by opening markets around the world so that we can expand our exports. Second, by 

leveling the playing field so that our people can compete and win in the global economy. And 

third, by ensuring that the rights and trade laws we have fought so hard for are fully implemented 

and enforced. 

I first had the opportunity to work with USTR as a White House Fellow under President George 

H. W. Bush, then under President Clinton and over the past four years as President Obama's 

adviser on international economic affairs. It is clear that USTR is a very special place. 
40 


87359.004

USTR professionals exemplify the finest traditions of public service. They work hard, they're 

nimble, they bring intellectual rigor to their mission, and they get things done. If confirmed, it 

would be an honor to lead them. 

As we speak, USTR staff are busy negotiating the groundbreaking Trans Pacific Partnership. 

They are consulting with you on the upcoming negotiations for an unprecedented Transatlantic 

Trade and Investment Partnership. And, in Geneva, they are working to energize trade 

liberalization, including on trade facilitation, information technology and services. 

All of these negotiations are designed to strengthen the multilateral, rules-based trading system 

and press it to achieve the highest possible aspirations. 

If we can conclude these agreements - and let me be clear, my view is that it is better to accept 

no agreement than a bad agreement - we wi II have positioned the United States at the center of a 

network of agreements creating free trade with 65 percent of the global economy. It is among 

the most ambitious trade agendas in history. 

Trade is also a powerful tool for development. If confirmed, I look forward to working with you 

to renew GSP and AGOA and to finding innovative ways to facilitate trade and regional 

integration across the developing world. 

Trade policy can only work, however, if it is fair. We are committed to opening markets, and we 

are equally committed to enforcing our trade rights and trade laws and to helping displaced 

workers obtain the skills and jobs they need. 

American workers are the most productive in the world. They deserve to compete on a level 

playing field. This Administration has made enforcement a top priority: 18 cases to date and the 

creation of the Interagency Trade Enforcement Center to enhance the depth and reach of our 

enforcement efforts. 

As with so many things, that could not have happened without your support. Trade policy only 

fulfills its full potential when it reflects close consultations between the Administration, 

Congress and a wide range of stakeholders. 

In that regard, if confirmed, I will engage with you to renew Trade Promotion Authority. TPA is 

a critical tool. I look forward to working with you to craft a bill that achieves our shared goals. 

Let me conclude by making clear that, if I am given the honor of serving as U.S. Trade 

Representative, I will do everything in my ability to promote the interests of our workers, 

farmers and ranchers; our manufacturers and service providers; our innovators, investors and 

consumers. 

Thank you again for considering my nomination. I am happy to answer your questions. 

### 
41 


87359.005

SENATE FINANCE COMMITTEE 

STATEMENT OF INFORMATION REQUESTED OF NOMINEE 

A. BIOGRAPHICAL INFORMATION 

1. Name: (Include any former names used.) 

Michael Braverman Goodman Froman 

Michael Braverman Froman (8/20/62-9/1/91) 

2. Position to which nominated: 

United States Trade Representative 

3. Date of nomination: May 6,2013 

4. Address: (List current residence, office, and mailing addresses.) 

Office: 

5. Date and place of birth: 

8/20/62; San Rafael, CA 

6. Marital status: (Include maiden name of wife or husband's name.) 

7. Names and ages of children: 
42 


87359.006

8. Education: (List secondary and higher education institutions, dates attended, 

degree received, and date degree granted.) 

The Branson School, 9/76-6/80; High School Diploma, 6/80 

Princeton University, 9/81-6/85; A.B. Public and International Affairs, 6/85 

Oxford University, 9/85-6/88; D.Phil in International Relations, 7/88 

Harvard Law School, 9/88-6/91, J.D., 6/91 

9. Employment record: (List all jobs held since college, including the title or 

description of job, name of employer, location of work, and dates of employment. 

Summer Associate, Office of the General Council. U.S. Department of Defense, 

Washington, DC, 6/89-7/89 

Summer Associate, Nishimura & Sanada, Tokyo, Japan, 7/89-8/89 

Summer Associate, Office of the Legal Advisor, U.S. Department of State, 

Washington, DC, 6/90-7/90 

Summer Associate, Covington & Burling, Washington, D.C., 7/90-8/90 

Summer Associate, Soble International Law, Washington, DC, 6/91-7/91 

Stagiarellntern, Commission of the EC, Brussels, Belgium 10/91-3/92 

Liaison, American Bar Association CEELI Program, Tirana, Albania, 3/92-8/92 

White House FellowlDirector, Office of Policy Development, The White House, 

Washington, DC, 9/92-1/93 

Director, International Economic Affairs, NECINSC, The White House, 

Washington, DC, 1/93-12/95 

Deputy Assistant Secretary for Eurasia and the Middle East, U.S. Department of 

the Treasury, Washington, DC, 12/95-1/97 

Chief of Staff, U.S. Department of the Treasury, Washington, DC, 1197-7/99 

Senior Fellow, Council on Foreign Relations/German Marshall Fund of the United 

States, Washington, DC, 7/99-11/99 

Chief of Staff, Office of the Chairman, Citigroup, New York, NY, 12/99-12/00 

Director, Emerging Markets Strategy, Citigroup, New York, NY, 12/00-12/01 

President and CEO, Citilnsurance, Citigroup, New York, NY, 12/01-6/05 

Managing Director and Head of Strategy and Business Development, Citi 

Alternative Investments, New York, NY, 7/05-3106 
43 


87359.007

Managing Director and Chief Operating Officer, Citi Alternative Investments, New 

York, NY, 3/06-4/07 

Managing Director and Head of Infrastructure and Sustainable Development 

Investments, Citi Alternative Investments, New York, NY, 4/07-1/09 

Deputy Assistant to the President and Deputy National Security Advisor for 

International Economic Affairs, The White House, 1/09-1/12 

Assistant to the President and Deputy National Security Advisor for International 

Economic Affairs, The White House, 1/12-Present 

10. Government experience: (List any advisory, consultative, honorary, or other parttime service or positions with Federal, State or local governments, other than 

those listed above.) 

Summer Associate, U.S. Department of State, 6/90-7/90 

Summer Associate, U.S. Department of Defense, 6/89-7/89 

Intern, U.S. Department of State, 6/84-8/84 

Intern, U.S. Information Agency, 6/83-8/83 

11. Business relationships: (List all positions held as an officer, director, trustee, 

partner, proprietor, agent, representative, or consultant of any corporation, 

company, firm, partnership, other business enterprise, or educational or other 

institution.) 

Trustee, The New School (2005-2009) 

Member of the Board, National Security Network (2006-2008) 

12. Memberships: (List all memberships and offices held in professional, fraternal, 

scholarly, civic, business, charitable, and other organizations.) 

Council on Foreign Relations (1993-Present) 

Bar Associations of New York, Massachusetts and District of Columbia (1991-

Present) 

Temple Sinai (2011-Present) 

JCC in Manhattan (2002-2011) 

American Society of International Law (1990-1992) 

Princeton Club (1985-1989) 

Trilateral Commission (2005-2008) 

National Security Network (2006-2008) 

13. Political affiliations and activities: 

a. List all public offices for which you have been a candidate. 
44 


87359.008

None 

b. List all memberships and offices held in and services rendered to all 

political parties or election committees during the last 10 years. 

None 

c. Itemize all political contributions to any individual, campaign organization, 

political party, political action committee, or similar entity of $50 or more 

for the past 10 years. 

Barack Obama 

Hillary Clinton 

Senate 2008 

Patrick Murphy 

Jack Reed 

Barack Obama 

Barack Obama 

DSCC 

Hillary Clinton 

Joe Lieberman 

DSCC 

Hope Fund 

Hope Fund 

Joseph Biden 

Hope Fund 

David Yassky 

Erskine Bowles 

Senate 2004 

Brad Carson 

Barack Obama 

Barack Obama 

Jamie Metzl 

Ed Case 

Hillary Clinton 

Yvette Clarke 

Brad Carson 

John Kerry 

Charles Schumer 

Artur Davis 

$2000 

$1000 

$1000 

$500 

$2300 

$300 

$2000 

$1000 

$1000 

$500 

$1000 

$1000 

$735 

$1000 

$1000 

$2100 

$1000 

$1000 

$200 

$200 

$1000 

$1000 

$1000 

$1000 

$500 

$500 

$2000 

$1000 

$1000 

10/9/12 

7114/08 

5/5108 

3/31/08 

3/3108 

1/24/08 

3/31/07 

5/25/06 

5/9106 

5/8/06 

4/19/06 

2/28/06 

2/21/06 

9/21/05 

6/7105 

6/1/05 

10114/04 

9121104 

9/21/04 

9/21/04 

6/16/04 

6/30/04 

6/30/04 

5/24/04 

5/11/04 

12/11103 

9130/03 

6/3103 

5/7/03 

14. Honors and Awards: (List all scholarships, fellowships, honorary degrees, 

honorary society memberships, military medals, and any other special 

recognitions for outstanding service or achievement.) 
45 


87359.009

Harry S Truman Scholarship (1983) 

Harold Rosenthal International Affairs Fellowship (1984) 

Fulbright Scholarship (1985) 

SSRC/MacArthur Foundation Fellowship in International Peace and Security 

( 1986-1987) 

Harvard College Danforth Certificate of Distinction in Teaching (1991) 

Ford Foundation Fellowship in Public International Law (1991) 

15. Published writings: (List the titles, publishers, and dates of all books, articles, 

reports, or other published materials you have written.) 

I have done my best to identify all books, articles, reports or other published 

materials, including thorough a review of personal files and searches of publicly 

available electronic databases. Despite my searches, there may be other 

materials I have been unable to identify, find, or remember. I have located the 

following: 

Promoting Sustainable Economies in the Balkans, Council on Foreign Relations, 

2000. (co-author) 

"Rebuilding the Balkans," Washington Post, November 20,1999. (co-author) 

"Dayton's Incomplete Peace," Foreign Affairs, Fall 1999. (co-author) 

Book Review of Alternative Security: Living Without Nuclear Deterrence, Edited 

by Burns H. Weston, 86 American Journal of International Law 205, 1992. 

Coming to Terms: The Development of the Idea of Detente, st. Martin's Press, 

1991. 

"Taking Reichs Seriously: German Unification and the Law of State Succession," 

104 Harvard Law Review 588, 1990. 

"International Trade - The U.S.-EC Hormone Treated Beef Conflict," 30 Harvard 

International Law Journal 549, 1989. 

"France and SOl," Naval War College Review, '1987. (co-author) 

"Strategic Implications of SOl for France and West Germany," Royal United 

Services Institute Journal, 1987. (co-author) 

"The Meaning of SOl," Army Quarterly and Defence Journal, 1987. (co-author) 

16. Speeches: (List all formal speeches you have delivered during the past five years 

which are on topics relevant to the position for which you have been nominated. 

Provide the Committee with two copies of each formal speech.) 

I have done my best to identify all formal speeches relevant to the position, 
46 


87359.010

including thorough a review of personal files and searches of publicly available 

electronic databases. Despite my searches, there may be other materials I have 

been unable to identify, find, or remember. I have located the following: 

6/8/2011 

7/13/2011 

1/4/2012 

5/7/2012 

5/16/2012 

5/18/2012 

6/12/2012 

6/14/2012 

7/11/2012 

7/18/2012 

7/31/2012 

9/912012 

9/11/2012 

9/19/2012 

10/23/2012 

117/2013 

2/20/2013 

3/16/2013 

4/17/2013 

4/18/2013 

4/23/2013 

4/28/2013 

CSIS Speech on Energy 

Trans - Atlantic Policy Network 

CSIS TPP Speech 

Transatlantic Week keynote Speech 

G8 briefing at Brookings 

Symposium on Food Security 

US-India Business Council 

AGOA Speech at State as part of the AGOA Forum 

JCAP Signing in Tanzania 

Kenya Chamber of Commerce Speech 

Center on Global Development Speech on Africa 

Speech in Egypt on Egypt Economics 

Speech in Qatar Asset Recovery Forum 

Global Services Summit Speech 

US-Russia Business Council Annual Meeting Keynote Speech 

Ethics and Globalization (PilE) Remarks on a panel 

Doing Business, in Africa - White House Event 

German Marshall Fund Panel on US-EU Trade 

South Sudan Conference 

Remarks at US Embassy in Ireland on TTIP 

Naval War College Talk on Economic Security 

Millennium Challenge Corporation Forum 

17. Qualifications: (State what, in your opinion, qualifies you to serve in the position 

to which you have been nominated.) 

I have been involved in international economic affairs, including trade policy, for 

more than 20 years. As Director of International Economic Affairs at the White 

House from 1992-1995, I worked closely with USTR on a number of trade 

matters. At the Treasury Department, I worked on a range of international 

economic issues as Deputy Assistant Secretary for Eurasia and the Middle East 

from 1996-1997 and as Chief of Staff from 1997-1999. Since returning to the 

White House in 2009, I have served as Deputy Assistant to the President and 

then Assistant to the President and Deputy National Security Advisor for 

International Economic Affairs, where my responsibilities include the coordination 

of international trade policy on behalf of the National Security Staff and National 

Economic Council. Throughout this period I have traveled extensively to meet 

with senior officials of our major trading partners and have developed strong 

working relationships that will provide a foundation for advancing the United 

States' interests in international trade matters. 
47 


87359.011

B. FUTURE EMPLOYMENT RELATIONSHIPS 

1. Will you sever all connections with your present employers, business firms, 

associations, or organizations if you are confirmed by the Senate? If not, provide 

details. 

If confirmed, I will remain an employee of the U.S. government. 

2. Do you have any plans, commitments, or agreements to pursue outside 

employment, with or without compensation, during your service with the 

government? If so, provide details. 

No. 

3. Has any person or entity made a commitment or agreement to employ your 

services in any capacity after you leave government service? If so, provide 

details. 

No. 

4. If you are confirmed by the Senate, do you expect to serve out your full term or 

until the next Presidential election, whichever is applicable? If not, explain. 

Yes. 

C. POTENTIAL CONFLICTS OF INTEREST 

1. Indicate any investments, obligations, liabilities, or other relationships which 

could involve potential conflicts of interest in the position to which you have been 

nominated. 

In connection with the nomination process, I have consulted with the Office of 

Government Ethics and the U.S. Trade Representative's designated agency 

ethics official to identify potential conflicts of interest. Any potential conflicts of 

interest will be resolved in accordance with the terms of an ethics agreement that 

I have entered into with USTR's designated agency ethics official and that has 

been provided to this Committee. I am not aware of any other potential conflicts 

of interest. 

2. Describe any business relationship, dealing or financial transaction which you 

have had during the last 10 years, whether for yourself, on behalf of a client, or 

acting as an agent, that could in any way constitute or result in a possible conflict 

of interest in the position to which you have been nominated. 

In connection with the nomination process, I have consulted with the Office of 
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Government Ethics and the U.S. Trade Representative's designated agency 

ethics official to identify potential conflicts of interest. Any potential conflicts of 

interest will be resolved in accordance with the terms of an ethics agreernent that 

I have entered into with USTR's designated agency ethics official and that has 

been provided to this Committee. I am not aware of any other potential conflicts 

of interest. 

3. Describe any activity during the past 10 years in which you have engaged for the 

purpose of directly or indirectly influencing the passage, defeat, or modification of 

any legislation or affecting the administration and execution of law or public 

policy. Activities performed as an employee of the Federal government need not 

be listed. 

I have engaged in no such activity. 

4. Explain how you will resolve any potential conflict of interest, including any that 

may be disclosed by your responses to the above items. (Provide the Committee 

with two copies of any trust or other agreements.) 

In connection with the nomination process, I have consulted with the Office of 

Government Ethics and the U.S. Trade Representative's designated agency 

ethics official to identify potential conflicts of interest. Any potential conflicts of 

interest will be resolved in accordance with the terms of an ethics agreement that 

I have entered into with USTR's designated agency ethics official and that has 

been provided to this Committee. I am not aware of any other potential conflicts 

of interest. 

5. Two copies of written opinions should be provided directly to the Committee by 

the designated agency ethics officer of the agency to which you have been 

norninated and by the Office of Government Ethics concerning potential conflicts 

of interest or any legal irnpediments to your serving in this position. 

6. The following information is to be provided only by nominees to the positions of 

United States Trade Representative and Deputy United States Trade 

Representative: 

Have you ever represented, advised, or otherwise aided a foreign government or 

a foreign political organization with respect to any international trade matter? If 

so, provide the name of the foreign entity, a description of the work performed 

(including any work you supervised), the time frame of the work (e.g., March to 

December 1995), and the number of hours spent on the representation. 

No. 
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D. LEGAL AND OTHER MATTERS 

1. Have you ever been the subject of a complaint or been investigated, disciplined, 

or otherwise cited for a breach of ethics for unprofessional conduct before any 

court, administrative agency, professional association, disciplinary committee, or 

other professional group? If so, provide details. 

No. 

2. Have you ever been investigated, arrested, charged, or held by any Federal, 

State, or other law enforcement authority for a violation of any Federal, State, 

county or municipal law, regulation, or ordinance, other than a minor traffic 

offense? If so, provide details. 

No. 

3. Have you ever been involved as a party in interest in any administrative agency 

proceeding or civil litigation? If so, provide details. 

In 2007, my spouse and I were among several parties sued by a lender who 

sought to collect on a mortgage owed by the prior owner of our residence. We 

were promptly dismissed from the lawsuit by agreement with the lender once it 

was determined that my spouse and I had no liability regarding the claim. 

4. Have you ever been convicted (including pleas of guilty or nolo contendere) of 

any criminal violation other than a minor traffic offense? If so, provide details. 

No. 

5. Please advise the Committee of any additional information, favorable or 

unfavorable, which you feel should be considered in connection with your 

nomination. 

None to my knowledge. 

E. TESTIFYING BEFORE CONGRESS 

1. If you are confirmed by the Senate, are you willing to appear and testify before 

any duly constituted committee of the Congress on such occasions as you may 

be reasonably requested to do so? 

Yes. 

2. If you are confirmed by the Senate, are you willing to provide such information as 

is requested by such committees? 

Yes. 
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Question 1: 

FINANCE COMMITTEE QUESTIONS FOR THE RECORD 

United States Senate 

Committee on Finance 

Hearing on 

Confirmation of Mr. Michael Froman to be 

United States Trade Representative 

June 6, 2013 

Questions from Chairman Baucus 

Mr. Froman, you have a very ambitious trade agenda before you. To fulfill the promise of 

that agenda, we need Trade Promotion Authority. With multiple negotiations moving 

forward, there is no time to waste. That is why I would like to see a bipartisan TP A bill 

introduced this month. I'm pleased that you are making TPA renewal a priority, and that 

you will engage with Congress to get TPA done quickly. Can you confirm that the 

President is formally requesting renewal of Trade Promotion Authority? 

Answer: Yes. If confinued, I will engage with you to renew Trade Promotion Authority. 

TP A is a critical tool. I look forward to working with you to craft a bill that achieves our 

shared goals. 

Question 2: 

For the past decade, I have fought hard to make sure our trade deals were good for U.S. 

agriculture. We've made progrcss in getting more access for U.S. beef in important 

markets like Japan, South Korea, and Taiwan, but the work there remains unfinished. 

And even as a Chinese company bids for a major U.S. pork producer, China remains 

closed to U.S. beef. 

How will you make sure our trading partners in Asia and Europe arc using sound science 

in relation to our exports of beef and other agricultural products? In this regard, how will 

you use the recent good news that the OlE has reclassified U.S. beef with its safest rating? 

Answer: The OlE's formal recognition of our negligible risk status for BSE is an 

important step to expanding U.S. exports of beef and beef products. Ifconfinued, I will 

work with USDA to press trading partners to open their markets to U.s. beef based on 

science and consistent with OlE guidelines for countries with a negligible risk 

classification. 
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Question 3: 

I continue to be concerned by Chinese policies that cost U.S. jobs. American innovation is 

the key to job growth in the United States and competitiveness in global markets. But some 

foreign countries are pursuing policies that create "localization" barriers to trade and 

misappropriate American innovation for the benefit of their own domestic industries. 

China, for example, has failed to end the wholesale theft of U.S. intellectual property, and 

pioneered the usc of "localization" requirements to force U.S. companies to turn over their 

innovation to Chinese companies. Now India and others are using similar "localization" 

measures. For example, India is requiring U.S. companies to transfer technology to 

domestic companies or produce locally in order to gain access to its market. We need to be 

on the offense and fight these unfair "localization" practices. 

Mr. Froman, how do you plan to engage China, India, and others to stop these practices 

and prevent their spread? What additional approaches can the United States take in order 

to stay on the offensive? What leverage do we have and how can we put this leverage to 

work? 

Answer: I understand that USTR and other agencies continue to raise localization 

barriers bilaterally, at the WTO, and in regional fora. However, the significant increase 

in number and seriousness of these barriers around the world necessitated a more 

comprehensive strategy that employs a wider range of tools. 

In response, USTR in 2012 established an interagency task force on localization barriers 

to trade, and is working within that context to develop and execute a more strategic and 

coordinated approach to stop these practices and prevent this policy direction from being 

adopted by more countries. This approach includes working with stakeholders in the 

United States and like-minded trading partners to (1) strengthen the analytical case 

against localization barriers; (2) multilateralize work to address localization barriers to 

trade; and (3) promote approaches that offer better ways to stimulate job creation and 

economic growth. If confirmed, I will continue these coordinated efforts to identify and 

address localization barriers imposed by our trading partners. 

Question 4: 

China's state engagement in commercial activity is tilting the global playing field against 

U.S. businesses. Government support for state-owned enterprises through currency 

manipulation, preferences and cheap financing give them an unfair advantage. This is true 

not only in the Chinese market, but in markets around the world, where Chinese SOEs can 

leverage their advantages to sell products more cheaply and invest strategically. I'm 

therefore pleased that USTR has been seeking strong disciplines on SOEs in the TPP. 

There must be a level playing field when SOEs are involved, whether from China or 

elsewhere. Mr. Froman, will you do your utmost to achieve strong SOE disciplines in the 

TPP and other trade agreements to achieve the level playing field that we all seek? 
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Answer: Yes, ifconfinned, I will seek strong disciplines on SOEs in TPP that will help 

level the playing field for American businesses, fanners, ranchers and workers. 

Question 5: 

Mr. Froman, I sometimes hear claims that USTR's process for negotiating the TPP is not 

transparent. From where I sit, this doesn't seem to be the case. USTR officials are 

constantly coming to the Hill to brief staff. And any Senator or Congressman can see 

negotiating text. 

Please explain your views on the claims that USTR is not transparent. 

Answer: USTR works closely with the public's representatives in Congress to conclude 

trade and investment agreements that benefit the American people and promote core U.S. 

values. In the Trans-Pacific Partnership, USTR is engaged in extensive outreach to ensure 

that all voices are heard in the attempt to find the correct balance of views on complicated 

and complex trade issues. USTR engages on a daily basis with Members of Congress and 

Senators and their staffs, not only to ensure the input of the people's representatives into 

every negotiating position, but also to keep you informed of the substance and progress 

of the talks. That engagement includes substantive briefings, in person discussion with 

negotiators, and the sharing of U.S. proposals and negotiating text. If confirmed, I look 

forward to continuing this close consultation with not only Congress, but with key 

stakeholders representing business, labor, academic groups, civil society, and the public. 

Question 6: 

I support the President's 2014 budget request for $56 million for USTR. Unfortunately, 

USTR's FY13 budget was cut too much. This is harming its ability to do its job and carry 

out the priorities of this Committee. USTR must have the resources it needs to fulfill its 

mission of increasing exports and enforcing trade agreements. 

Mr. Froman, will you commit to fight to ensure that USTR has adequate resources? 

Answer: USTR is a small, nimble organization. It is my understanding that recent cuts 

leading to staff shortages and reduced engagement with our trading partners have raised 

difficult choices among its negotiating, monitoring, and enforcement priorities. I fully 

support the President's 2014 budget request and the administration's efforts to replace the 

sequester with balanced deficit reduction. If confirmed, I will work to ensure that USTR 

has the resources it needs to fulfill its mission. 

Question 7: 

As you know, the current Softwood Lumber Agreement is set to expire in 2015. There 

appears to be interest on both sides of the border to extend the SLA, or some version of it. 

lt is critical that any extension or new deal is a good deal for the U.S. and Montana lumber 

industry. 
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If confirmed, how will you approach these negotiations with Canada? Can you also 

provide me assurances that you will work to vigorously enforce any violations by Canada 

of the agreed-upon terms? 

Answer: The SLA was recently extended until mid-October 2015 with the support of 

domestic lumber producers and continues to provide predictability and stability in this 

very important sector in the U.S. economy. If confirmed, I will ensure that Canada 

abides by its obligations under the current SLA, and that the USTR team continues its 

ongoing communications with Congress, the lumber industry, and all interested 

stakeholders. These ongoing consultations put the United States in the best position to 

plan for the expiration of the SLA, and, if confirmed, I will be closely involved in this 

process. 

Question 8: 

Improving the movement of goods across our borders has an immediate impact for U.S. 

companies. It will cut costs and reduce delays for U.S. manufacturers and agricultural 

producers alike. This is why I introduced S. 622, the Trade Facilitation and Trade 

Enforcement Act of 2013, with Senator Hatch. My customs reauthorization bill improves 

trade facilitation by making sure U.S. Customs and Border Protection and U.S. 

Immigration and Customs Enforcement prioritize their trade missions. And it provides 

new tools and resources to these agencies to improve enforcement and prevent infringing 

goods from getting into the stream of commerce. Similarly, the Trade Facilitation 

negotiations in the WTO can have a real impact on the movement of trade around the 

world. Reaching a successful conclusion on these negotiations will reduce costs and delays 

at borders across the globe and expand trade. Unfortunately, the negotiations are being 

held up by the same obstructionism that has plagued the WTO recently. What will you do 

to break the logjam so we can bring this negotiation to a conclusion? What can and should 

we do here in the United States to improve trade facilitation and enforcement? 

Answer: USTR has been working hard to conclude a strong, binding WTO Trade 

Facilitation Agreement as part of a package of results for adoption at the Ministerial 

Conference in Bali in December. The United States has been prepared to work with other 

WTO Members to include certain provisions on agriculture and development in this 

package, so long as they clearly can be accomplished and do not upset the fundamental 

balance of interests on other U.S. priorities, such as market access. We have made it 

clear that we will only agree to a Bali package that includes a meaningful and enforceable 

Trade Facilitation Agreement. 

A WTO Trade Facilitation Agreement would complement U.S. domestic efforts to 

promote trade facilitation and customs enforcement here. With the ambitious trade 

agenda the Administration has announced, USTR will be in a position to take a strong 

lead in ensuring that U.S. traders have access to the most efficient, cost effective, and 

transparent border agency approach to intcmational trade, and one that ensures effective 

enforcement of border measures. 
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If I am confirmed, USTR will work with relevant agencies to support trade facilitation 

and enforcement and to ensure effective coordination and communication of efforts 

across the U.S. government. 

Questions from Senator Hatch 

Question 1: 

I understand that levies are assessed in a number ofEU member states on digital products 

such as smart phones, tablets, personal computers and other products that store data. Socalled "collecting societies" in various EU countries apply these levies, which can be as high 

as 3.5% and can add as much as $25 on the price of a typical Pc. These levies are collected 

purportedly to compensate content rights holders of copyrighted material that has been 

subject to private copying. 

My concern is that these levies are not always transparent, they are not uniformly applied 

across the EU, and they are sometimes used for purposes other than to compensate content 

rights holders. Further, they undermine the very spirit of this trade agreement as well as 

the WTO Information Technology Agreement because they raise the cost for U.S. 

technology companies and for consumers. Several associations addressed this issue in the 

Administration's recent solicitation of comments. 

Can you tell us how you plan to handle this issue in the negotiations? Can the levies be 

removed, consistent with USTR's objective for the TTIP to "eliminate all tariffs and other 

duties and charges on trade" as notified to Congress on March 20th? 

Answer: As you state, private copying levies are assessed in EU and other markets that 

permit private copying of copyright-protected content in order to compensate rights 

holders. In the context ofTTIP, USTR will continue to engage with Members of 

Congress and interested stakeholders as part of the 90-day consultation period and 

beyond with respect to the EU private copy levy regime in order to advance and defend 

U.S. interests. 

Question 2: 

USTR's National Trade Estimate Report on Foreign Trade Barriers has listed India's 

localization requirement for boric acid exported from the United States every year since 

2006.Yet, India continues to stall any satisfactory resolution ofthe matter, U.S. 

Government efforts? 

What can you do to ensure that India takes action to resolve this matter? If India 

continues its actions will you consider requesting consultations through the World Trade 

organization? 
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Answer: I understand that USTR has been working to resolve the challenges to entry of 

U.S. boric acid into India. If confirmed, I will reinforce those efforts to press India on 

this issue in bilateral engagement as well as in the WTO, and to explore all available 

policy tools to ensure India's compliance with its international obligations 

Question 3: 

Last year as Congress worked toward passing permanent normal trade relations with 

Russia, the President said: "From day one of its membership in the WTO, Russia will be 

required to comply with WTO rules on the protection and enforcement of intellectual 

property rights, including with respect to key rights relied on by U.S. creative and 

innovative industries." In addition, the Administration assured Congress that additional 

work to bring Russia into compliance with their WTO commitments would be conducted 

through a U.S.-Russia IPR Working Group. 

Has Russia come into compliance with its WTO commitments on IPR? What progress has 

been made in the IPR Working Group? 

Answer: If confirmed, I will continue to monitor Russia's adherence to its WTO 

commitments through work in the WTO Council for Trade-Related Aspects of 

Intellectual Property Rights (the TRIPS Council) as well as USTR's ongoing intensive 

bilateral engagement with Russia on the protection and enforcement of intellectual 

property rights. On March 26, 2013, USTR convened a meeting of the U.S.-Russia 

Working Group on Intellectual Property Rights. During that meeting, specific elements 

of the U.S.-Russia Intellectual Property Rights Action Plan were assessed, including 

combating copyright piracy on the Internet, enhancing IPR enforcement, and 

coordinating on IPR legislative reform and other issues. If confirmed, I will continue to 

ensure consistent attention to, and progress on, these IPR objectives and implementation 

of the Action Plan, both under the auspices of the Working Group, as well as the WTO, 

and through other engagement. 

Question 4: 

The final PNTR legislation for Russia includes important reporting requirements for 

USTR, firstly, on Russia's implementation of Sanitary and Phytosanitary and Intellectual 

Property Rights enforcement commitments as well as their progress toward joining and 

implementing the ITA and GPA Agreements. Under this report, USTR must state areas 

where Russia is not living up to these commitments. And, secondly, the legislation requires 

a report on measures taken by USTR and the Department of State to improve rule oflaw 

in Russia in support of U.S. investor state relations, including by promoting the claims of 

U.S. investors in the Yukos Oil Company. 

Can you please provide a status report on progress made in these areas? Further, can I get 

your firm commitment these statutory reports will be delivered to the Senate Committee on 

Finance and House Committee on Ways and Means on time? 
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Answer: With regard to its commitment to join upon accession the Information 

Technology Agreement (IT A), Russia has revised its schedule and sent it to the Eurasian 

Economic Commission for modification of the Customs Union's tariff schedule. To 

finalize its accession to the ITA, Russia must send the revised schedule to the WTO IT A 

Commission for approval, and then revise its WTO bound schedule accordingly. If 

confirmed, I will push to ensure that this process is completed. With regard to the 

Agreement on Government Procurement (GPA), Russia became an observer to the GP A 

Committee on May 29. Russia has committed to table an offer on joining the GPA 

within four years of joining the WTO. 

With regard to Russia's commitments concerning sanitary and phytosanitary measures, 

Russia continues to apply measures on tetracycline and ractopamine residues that are 

more stringent than international standards, but which do not appear to be supported by 

risk assessments done in accordance with international standards. If confirmed, I will use 

all appropriate means to resolve these matters, including, as needed, the full panoply of 

WTO tools, including dispute settlement, where appropriate. 

The Administration is monitoring closely the significant claims brought by Yukos 

investors from many different countries in international court and arbitration proceedings 

and expects these decisions to shed light on many of the complex legal issues at stake in 

this matter. 

I understand that the first of the reports called for in the law will be delivered on time 

later this month to the Senate Committee on Finance and House Committee on Ways and 

Means. If confirmed, I will work to ensure future reports are delivered on time as well. 

Questions 5: 

Last year, Taiwan was the 11th-largest U.S. trading partner, with a total amount of trade 

at $63.2 billion. What can the United States do to further enhance our economic 

relationship with Taiwan? Do you believe that a free trade agreement with Taiwan or 

Taiwan's participation in the Trans-Pacific Partnership are viable options? 

Answer: The United States and Taiwan have a strong and important bilateral trade and 

investment relationship. If confirmed, I will seek to enhance further our relations with 

Taiwan. I believe we should continue to focus on strengthening our economic 

relationship with Taiwan through our bilateral Trade and Investment Framework 

Agreement. Regarding participation by Taiwan in the TPP, the TPP is open to all APEC 

economies-including Taiwan-that can establish their readiness to meet the high 

standards of the agreement. 

Question 6: 

On June 4, 2013, the Obama Administration released a set of proposals to change this 

country's patent system, including proposed changes to the International Trade 

Commission's Section 337 process. The Section 337 process provides a means for U.S. 
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right holders to stop infringing imports at the border. Although the Senate Finance 

Committee has jurisdiction over ITC matters, the Administration has failed to consult with 

this Committee on its legislative proposals before going to the press. 

(a) When did you become aware that the Administration was contemplating 

changes in this area and why hasn't the Administration consulted with 

Congrcss? 

(b) If confirmed as USTR, will you commit to consulting with Congress before 

major legislative proposals on trade policy are announced to the press? 

Answer: If confirmed, I will continue USTR's practice of close consultation with 

Congress on matters of trade policy. While I was not personally involved in the patent 

process, my understanding is that, in the June 4 announcement, the Administration made 

clear that it stands ready to work with Congress on these issues crucial to our economy, 

American jobs, and innovation. If confirmed, I stand ready to work with you on the trade 

policy aspects of this issue. 

Question 7: 

Korea has yet to fully implement its free trade agreement with the United States. In 

particular, the government of Korea continues to use pirated software, which is prohibited 

under the agreement. Korea has also failed to establish an independent review process to 

make sure that decisions regarding pricing and reimbursement for medicines and medical 

devices are fair. 

What steps would you be prepared to take if you are confirmed to ensure that Korea lives 

up to its obligations under our FTA? 

Answer: On use of unlicensed software by the Government of Korea, I understand that 

we have achieved significant progress following senior level engagement by USTR and 

other Administration agencies. If! am confirmed, I will continue USTR's work in 

ensuring that American intellectual property rights are protected and enforced in Korea 

and elsewhere. 

In addition, I understand that USTR has raised and continues to raise issues related to the 

implementation of the independent review process with the Korean government. If 

confirmed, I will work to ensure that the independent review process functions as set 

forth under the KORUS agreement. 

Question 8: 

The Andean Trade Preference Act (ATP A) expires on July 31st. Ecuador is the sole 

remaining beneficiary country under ATPA. Unfortunately, Ecuador continues to take 

actions that harm United States trade interests. 
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For example, Ecuador has failed to recognize and enforce international arbitration awards 

favoring U.S. citizens and companies. Ecuador has also substantially raised its fees for 

patent rights and plant variety protection in a way that discriminates against right holders 

from the United States. And last November, Ecuador issued a compulsory license for a 

patented pharmaceutical product developed by a U.S. manufacturer. 

I don't believe Ecuador's behavior should be rewarded by extending their benefits under 

the ATP A. In expectation of the expiration of ATPA, I understand that Ecuador has 

petitioned USTR to expand GSP's coverage to include many of the benefits of the ATPA. 

Do you believe that Ecuador should be able to circumvent the will of Congress and receive 

expanded benefits under the GSP program? 

Answer: I understand that of the ten products the government of Ecuador sought to add 

to the list of products eligible for duty-free treatment under the asp program this year, 

only three were accepted for formal review. In addition, the Administration is 

considering whether to accept a petition to suspend Ecuador's eligibility for asp benefits 

based on its alleged failure to recognize and enforce in good faith international arbitral 

awards. Decisions on those requests are currently pending. If confirmed, I will work 

with you and others in Congress to re-authorize the asp program, and apply it in a way 

that benefits both the United States and our developing country trading partners. 

Question 9: 

While all agree that the U.S. and EU share robust regulatory, intellectual property, and 

enforcement systems, there remain significant outstanding issues in the EU, particularly 

with regard to its treatment of clinical trial data for biopharmaceutical products. The 

European Medicines Agency's current and proposed policies for disclosing confidential 

commercial information contained in marketing authorization dossiers appears to violate 

thc EU's international obligations to protect intellectual property and undermines patient 

privacy, regulatory system integrity, and incentives for biopharmaceutical research and 

development. As USTR, will you commit to engage with the EU in every available venue to 

resolve this issue? 

Answer: USTR has engaged intensively on behalf of U.S. stakeholders with the EU on 

this issue and will continue to do so. USTR's engagement has focused on ensuring that 

that the EU fully protects such clinical data for biopharmaceutical products consistent 

with its own law and international commitments, including with respect to intellectual 

property rights. If confirmed, I will ensure that USTR monitors developments on this 

issue closely. 

Question 10: 

In 2009, amid controversy over bonuses paid by firms receiving TARP bailouts, it was 

reported that you were going to donate your 2008 Citigroup bonus, paid to you in 2009, to 

charity. You have noted to the Committee that you have already donated a significant 
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portion of your 2008 year-end Citigroup bonus to charity and you continue to donate 

additional portions to charity. 

Please list, in dollars, how much of your 2008 bonus you have donated to charity year-byyear. 

Of your entire $2,250,000 bonus, how much do you intend to give to charity, and what is 

your time-frame for doing so? 

Answer: I have donated approximately 75 percent of the net proceeds of my 2008 bonus 

to charity. I intend to contribute the remainder in the next few years. I will work with 

the Committee staff to provide additional information as appropriate. 

Question 11: 

Vou have noted that, regarding your participation in the CVCIGP II U.S. Employee, L.P. 

(CVeI) fund, "sales or transfers of interests in the fund were generally not permitted 

except under very limited circumstances such as termination for cause, retirement, 

disahility or death." Vou have also noted that "My ethics agreement requires that, if 

confirmed, I will divest my limited partnership interest in eVCI within 90 days following 

such confirmation." 

Aside from things like being fired from Citigroup for cause, and the other factors you cite, 

can you document that there are no other ways for investors in the Cayman Island 

investment that you are participating in to divest? 

Have you at any time attempted to sell your interest in CVeI before now, or is the ethics 

agreement you have entered into the first time you have contemplated selling your interest 

in CVeI? 

Is a recommendation from a government ethics official a criterion in the CVCI partnership 

documents under which divestment can occur and, if so, can you provide such 

documentation? 

Answer: Terms for sales or transfers of interests in cvcr are identified in the documents 

r have provided to the committee. I have not attempted to sell my interest in cvcr 

previously as it has not previously been directed by an ethics official or permissible under 

the terms of the investment. My understanding is that USTR ethics officials have 

informed Citi that they are directing divestment and that Citi has agreed to permit it. 
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Questions from Senator Rockefeller 

Questiou 1: 

The European Union (EU) is requesting that air services be included in the Transatlantic 

Trade and Investment Partnership (TTIP) negotiations. Historically, the Department of 

State (State) and Department of Transportation (DOT) have negotiated aviation 

transportation agreements. At present, they have negotiated liberalized ("Open Skies") 

agreements with over 110 countries, including a recent one with the EU that has resulted in 

substantial benefits for both the EU and the United States. This aviation-specific 

negotiating framework has worked well, and I believe future aviation services agreements 

should continue to be handled iu this manner. Is the United States Trade Representative 

(USTR) including air services in the scope of their TTIP negotiations with the EU? If air 

services are not currently included in the scope of the EU TTIP negotiations, will the USTR 

notify the Finance Committee and its Members if this changes and does become a topic of 

TTIP negotiations? 

Answer: We are still in the 90-day consultation period regarding TTIP. Air services 

have traditionally been covered by Open Skies agreements, not trade agreements. I am 

aware of the sensitivity around this issue and, if! am confirmed, USTR will remain in 

close communication with the Finance Committee as the negotiations proceed forward. 

Question 2: 

There are several important trade negotiations underway, including ones with Asia Paeific 

countries (Trans-Pacific Partnership) and with Europe (Transatlantic Trade and 

Investment Partnership) and one focused on services trade (Trade in Services Agreement). 

These are critical opportunities to modernize trade rules to keep pace with changes in the 

U.S. economy. One priority is the need for these agreements to break down barriers to 

U.S. companies selling or using digital products and services-or transferring data to run 

their operations-across borders. In other words, we need trade rules that take into 

account our 21st century businesses, like cloud computing, that only operate effectively if 

data can flow across borders with few restrictions. Will this be a priority for you in these 

negotiations? 

Answer: I agree that addressing the impediments to trade in digital products and services 

should be-a top priority for any new trade agreement. If I am confirmed, I will work to 

include provisions in our FTAs that reflect this priority. 

Question 3: 

China remains a huge challenge for American businesses. To note one example, the 

software industry faces a nearly 80% piracy rate in China and also confronts barriers that 

shut out foreign products from certain parts of thc market. In some cases, foreign 

companies need to transfer technology or IP to access the market. Through the U.S.-China 

Joint Commission on Commerce and Trade (JCCT) and other negotiations with China, 
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USTR has made important progress reorienting the discussion to focus on results rather 

than commitments by China. Whether U.S. software companies and other industries with 

IP-intensive products are selling more in China should be the ultimate measure of whether 

these negotiations are successful. We urge you to continue to pursue this type of resultsoriented trade policy in negotiations with China and with other countries as well. 

Answer: Thank you for raising these important concerns. As you indicate, USTR has 

worked hard to urge China to address its very high software piracy rates and to eliminate 

measures conditioning market access on the transfer of technology or intellectual 

property rights to domestically controlled entities. If I am confirmed, I will ensure 

that USTR continues to press China on all fronts for firm commitments and real progress 

on these important issues affecting sales of software and other IP-intensive products in 

China. These efforts will continue to build on China's 2012 Strategic and Economic 

Dialogue commitment related to increasing the level of sales of legitimate IP-intensive 

products and services. 

Questions from Senator Wyden 

Question 1: 

During your confirmation hearing, through our discussions, and based upon media 

accounts, the U.S. government, the EU, and China are in discussions about ways to resolve 

the trade challenges that originate from China's unfair trade practices in the solar sector. 

If confirmed, will addressing these pressing challenges remain a priority of yours and of 

the Administration's? Please provide a status update of these talks. 

Answer: With regard to the challenges you raise concerning China and the solar sector, 

the Administration has reached out to China and the EU to explore a possible negotiated 

solution and has had some initial discussions about how to deal with these matters on a 

global basis and with regard to the entire solar sector supply chain. In so doing, we are 

working to support the three U.S. objectives of (I) ensuring a level playing field for U. S. 

solar manufacturers and their products by enforcing U.S. trade remedy laws and U.S. 

rights under the World Trade Organization agreements and (2) accelerating the adoption 

of renewable energy technologies in the United States and the world, and (3) leveling the 

playing field so that U.S. clean energy manufacturers can compete and win in this 

growing market. If confirmed, I will continue to support these efforts. I can assure you 

that addressing the trade challenges that we face in the solar sector will remain a priority 

for USTR and that, if confirmed, we USTR will explore all avenues to attempt to address 

them. 
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Question 2: 

The Obama Administration's track record on trade enforcement is encouraging, but J 

would like to see a more proactive approach toward identifying and remedying unfair 

trade practices. 

The executive branch can more effectively combat unfair tradc by working closely with 

workers and with affected industry. Thc Stcelworkers 301 petition is an example of a good 

partnership between workers and government, as are those related to combating duty 

evasion. But the Administration must act on its own to level the playing field when 

workers and producers cannot. If confirmed, will you commit to an aggressive, proactive 

approach toward trade enforcement, recognizing that workers and businesses often do not 

have the capacity or the resources to identify and remedy unfair trade on their own? 

Answer: President Obama has elevated trade enforcement as a top priority for U.S. trade 

policy. This Administration has brought 18 enforcement actions to date and set up the 

Interagency Trade Enforcement Center (ITEC), which enhances the capacity to be 

proactive in bringing enforcement actions. If confirmed, I will ensure that USTR 

continucs to engage in vigilant monitoring and rigorous enforcement of U.S. trade rights 

to ensure that America's businesses and working families are able to seize all of the jobsupporting opportunities available under U.S. trade agreements. 

Question 3: 

As you know, Chinese producers are finding ways to circumvent and evade the U.S. 

AD/CVD orders on solar, in addition to other AD/CVD orders. As we discussed privately, 

you are aware about how Chinese suppliers engage in schemes to transship merchandise 

and falsify records in order to evade AD/CVD. If confirmed, how will you work to help 

ensure that Customs and Border Protection and the Department of Commerce more fully 

enforce the trade remedy laws-will you make a recommendation to the National 

Economic Council to use its resources and authority to get a handle on this issue and 

organize a coordinated response among the relevant agencies? 

Answer: If confirmed, I will utilize all of the tools at USTR's disposal to ensure that our 

strong trade remedy laws are fully enforced and defended at the WTO. This would 

include enhancing the coordination and enforcement efforts across the U.S. 

government-whether through mechanisms such as the Interagency Trade Enforcement 

Center (ITEC) or otherwise-and ensuring that all the relevant agencies are working in 

the most effective manner to address border enforcement and other the specific 

enforcement issues, whether in the solar case or others. 

Question 4: 

As demonstrated by the U.S. and EU solar cases, in addition to many others, instead of 

addressing the issues underlying the AD/CVD orders, China filed retaliatory cases against 
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U.S. and EU industries. How do you intend to address China's broad strategy of 

retaliation? 

Answer: This Administration has made it a priority to vigorously enforce U.S. trade 

remedy laws. We have also devoted unprecedented resources to defend U.S. trade 

remedies when challenged by China and others in the WTO. 

With regard to retaliation for legitimate U.S. trade remedy actions, we have mounted 

swift challenges at the WTO when it has occurred. To date, we have challenged three 

sets of Chinese AD/CVD orders on imports from the United States: (1) grain-oriented 

electrical steel (GOES), which we won and which China is obligated to implement by 

July 31 of this year; (2) chicken broiler products, for which we are awaiting a panel 

decision this summer; and (3) automobiles, where the first panel meeting is scheduled to 

take place in the coming weeks. We have confidence in the strength of our legal 

arguments in the two cases that remain to be decided. 

If confirmed, I will ensure that the Administration continues to defend vigorously and 

proactively the rights of U.S. industry in the trade remedies sphere. 

Question 5: 

If confirmed, will you maintain any of your current responsibilities, including but not 

limited to those related to the G-8 and G-20? If so, what responsibilities, in detail, will you 

retain and how will this impact resource allocation within the office of the U.S. Trade 

Representative (USTR) and the Executive Office of the President? 

Answer: If confirmed, I will no longer serve in my current G-8 or G-20 role. 

Question 6: 

I and others believe that there needs to be more transparency around trade negotiations, in 

a variety of areas. Do you agree that there are some topics in trade negotiations, such as 

around Intellectual Property protection and Investment, where the degree of public 

interest is far greater than other topics? With respect to these areas of significant public 

interest, will you commit, if confirmed, to provide the public with a clear, comprehensive, 

and updated description of what trade negotiators are seeking to obtain on behalf of the 

American public? 

Answer: We are all affected by global trade, and every aspect of a trade agreement has 

stakeholders whose interests are equally important. The Obama Administration led the 

TPP countries in putting online a plain-English description of all the Trans-Pacific 

Partnership's elements as soon as we reached the broad outlines of an agreement, and 

also put online clear, plain-English descriptions of various proposals of particular interest 

to the public. If confirmed, I will ensure that USTR continues its efforts to do an even 

better job in regard to transparency with the American public on U.S. proposals of 

particular interest in the Trans-Pacific Partnership. 
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Question 7: 

Since President Obama took office in 2009, how many times has the office of the USTR 

briefed Congress (Members and staff) about the Trans-Pacific Partnership (TPP) 

negotiations? How many of these briefings were "classified?" Given that the formal U.S. 

proposals in the TPP negotiations are currently classified, would not any discussion that is 

led by the USTR on such proposals also be classified? If not, please explain why not. 

Based upon this assessment, will you seek any changes to the nature of consultations with 

Congress, should you be confirmed? 

Answer: The Trans-Pacific Partnership is a bold initiative through which the Obama 

Administration is advancing the United States' multifaceted trade and investment 

interests in the dynamic Asia-Pacific region, and a key element of the Obama 

Administration strategy to make U.S. engagement in the Asia-Pacific region a top 

priority. It is my understanding that as a part of this effort, USTR has been consulting 

closely with this Committee and your colleagues before negotiations even began. 

I understand USTR has consulted with the Senate Finance Committee and House Ways 

and Means Committee hundreds of times since 2010 on the Trans-Pacific Partnership. In 

the same period, USTR consulted with committees on issues related to their particular 

jurisdiction, including House Agriculture, Senate Agriculture. House Judiciary, Senate 

Judiciary, House Financial Services, Senate Banking, House Foreign Affairs, Senate 

Foreign Relations, I-louse Education and Workforce, Health, Education, Labor, and 

Pensions, Energy and Public Works, and Energy and Commerce. Further, I understand 

USTR formally consulted with interested members of Congress, their staffs, interested 

Congressional caucuses, and Congressional leadership. I hope the often daily 

communication between USTR and Congressional staffs indicates the premium this 

administration places on conducting these negotiations in close cooperation with this 

committee and your colleagues. 

I understand that USTR works to provide as much information as possible in these 

briefings but the level of detail differs from that set out in U.S. proposals. If confinned, I 

look forward to working with you and this Committee to discuss further how best USTR 

can continue its close consultation with Congress. 

Question 8: 

As you know, Congress established the trade remedy laws-the laws that allow for the 

application of anti-dumping and countervailing duties-in order to ensure that American 

producers can be protected from unfair trade. These laws are designed to ensure that 

domestic producers can exercise their rights despite how doing so may impact the political 

landscape for Congress or for the President. The integrity of America's trade remedy laws 

is of paramount importance if the USTR to successfully challenge other countries' 

unscrupulous application of their AD/CVD laws. China likes to assert, for example, that 

AD/CVD actions in the U.S. are politically motivated, which is, of course wrong. So let's 

set the record straight. 
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Do you agree that AD/CVD determinations should be free, and are free, from political 

influence by the White House? 

Is it correct that neither you nor your staff, as far as you are aware, attempted to influence 

(directly or indirectly) any AD/CVD case since President Obama took office in 2009? 

Answer: I agree with you. By statute, the U.S. Department of Commerce and the U.S. 

International Trade Commission conduct AD/CVD investigations, and do so in a manner 

that is free of political influence. The U.S. AD/CVD process is open and transparent and 

provides all interested parties an opportunity to present relevant information and defend 

their interests. 

Question 9: 

The U.S. leads the way in innovation-based economic growth-and it must continue to do if 

is going to sustain strong middle class jobs in Oregon and across the country. 

Unfortunately, some countries such as India are distorting the trade rules through policies 

such as forced intellectual property transfer or mandated local production as a condition of 

market access. I'm deeply concerned about India's trade positions right now, but I also 

worried that, absent a strong response from the U.S. Government, other countries will 

replicate India's actions. The U.S. faces similar challenges with other countries such as 

China. In the case of China, the U.S. utilizes the JCCT and S&ED forums to formally 

address concerns such as these. How to you propose to strengthen the economic dialogue 

with India to address economic challenges and also identify opportunities for 

collaboration? Does the administration need any additional tools that will help improve 

the economic relationship between the U.S. and India? 

Answer: I understand that over the past two years, USTR has worked with the 

Government of India to identify steps to strengthen the bilateral trade and investment 

dialogue. If confirmed, I will reinforce to the Government of India that our bilateral trade 

and investment dialogue remains critical to our broader bilateral relationship. I also 

intend to use other mechanisms-from the Strategic Dialogue to the CEO Forum-to 

reinforce our trade and investment agenda. If confirmed, I will also look forward to 

working closely with Congress to determine what, ifany, additional tools might be 

required. 

Question 10: 

In U.S. Intellectual Property law, "Fair Use" is a bedrock principle that enables innovation 

and the jobs it creates. In my discussions with the office of the USTR over the years, 

negotiators generally attempt pursue disciplines in trade agreements that are consistent 

with U.S. law. Unfortunately, Fair Use or similar principles do not yet appear in U.S. free 

trade agreements. For America's trade policy to fulfill its potential in today's economy, it 

must ensure that American innovators can compete abroad just as they can at home, and 

that requires trade policy to promote the same balanced approach to IP protection abroad 

that is protected domestically. 
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The Trans-Pacific Partnership and the emerging EU-U.S. trade negotiations are key 

opportunities for the U.S. Government to stand up for the open Internet. If a concluded 

TPP agreement does not include new language that reflects the balanced approach found in 

U.S. law and practice that enables the Internet economy to thrive, TPP will represent a 

profound missed opportunity for the American economy, tbe jobs it supports, and the 

Obama Administration's efforts to establish "21st Century" trade agreements that are 

meaningful to the 21st Century economy. 

What will you do, if confirmed, to make certain that IP disciplines in TPP and other trade 

agreements are fully consistent with U.S. law and its balanced approach-will you support 

Fair Use disciplines in free trade agreements? 

Answer: A robust copyright framework ensures that authors and creators are respected, 

investments (both intellectual and financial) are promoted, that limitations and exceptions 

provide an appropriate balance, and that enforcement measures are effective. I support 

the new approach that USTR has taken to limitations and exceptions in the TPP 

negotiations; that approach is consistent with both U.S. law and international obligations. 

If confirmed, I look forward to continuing to engage with the Committee, Congress and 

stakeholders regarding the appropriate approach to these issues in future trade 

agreements. 

Ouestion 11: 

International trade and investment agreements represent an opportunity to level the 

playing field for American producers. Section 230 of the Communications Decency Act is 

one pillar of domestic law that enables the Internet economy to thrive-it paved the way 

for social media and much ofthe innovation that has occurred since its enactment. The 

Internet technology industry has advocated that section 230 principles be included in trade 

agreements in order to ensure that foreign markets are not more hazardous legal 

environments than the domestic market is. If confirmed, will you take the time to discuss 

the importance of Section 230 with America's leading Internet companies and consider 

advancing principles that reflect Section 230 in U.S. free trade agreement negotiations? 

Answer: USTR has been working closely with the Internet technology industry to 

develop disciplines that will enable the Internet economy to thrive. The issue ofinternet 

intermediary liability is an enormously complex issue, given the multiplicity of 

regulatory and industry interests involved both domestically and abroad. If confirmed, I 

will make sure our negotiators continue to work closely with industry to consider how the 

principles reflected in section 230 could be integrated into our trade agenda. 
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Question 12: 

If confirmed, will you do a top-to-bottom review of how resources at the office of the USTR 

are allocated and determine whether they are correctly prioritized given the growing 

importance of addressing digital trade issues? If so, will you report your assessment to me, 

in writing, within 90 days of your confirmation? 

Answer: IfI am confirmed, ensuring that USTR's resources are being properly 

prioritized and reflect our evolving economy will be an important focus of my efforts as 

USTR. I will be pleased to engage with you as I work through USTR's priorities. 

Question 13: 

The Internet represents the shipping lane of the 21st Century. The U.S. proposal to 

establish binding disciplines on cross-border data flows within the TPP negotiations is 

significant and important and I have long encouraged it. Will you make obtaining this 

proposal in TPP a priority and how will you seek similar disciplines elsewhere? 

Answer: Obtaining strong disciplines relating to cross-border data flow is and will 

continue to be a priority in TPP. If! am confirmed, I will seek to include these kinds of 

disciplines-in new trade-agreements as well. 

Question 14: 

Duriug President Obama's first term, the Administration made clear that protection of 

intellectual property (IP) was at the top of the United States' economic agenda and a 

priority for U.S.-China bilateral engagement. USTR did a terrific job in leading the 

interagency effort here, and I know that you worked closely with the team to convey this 

message to your counterparts in China. IP protection remains essential to the U.S. 

economy. What's your plan for continuing to engage the Chinese authorities on the 

question of IP, ensuring that the debate on trade secret theft complements rather than 

sidetracks the other IP issues like software legalization and your strategy for avoiding a 

slow-down in efforts due to a change in China's Leadership? 

Answer: The Administration continues to be committed to working with all of America's 

trading partners, including China, to secure adequate and effective intellectual property 

protection wherever American goods and services are sold. If I am confirmed, I will work 

to protect American IPR in China, and to reduce the export of infringing products made 

in China. This effort will include the entire range of IP issues, including protection of 

trade secrets, patents, copyright protection of software, films, music, and books, 

trademark matters, as well as newer concerns like the IP-related aspects of China's 

indigenous innovation policies and cyber theft. If I am confirmed, I will work through a 

variety of mechanisms-including results-oriented dialogue on IPR protection and 

enforcement, the annual Special 301 Report, and enforcing international rules-to protect 

American intellectual property and market access through the WTO. The Administration 
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will continue to pursue this strategy in close coordination with other relevant U.S. 

agencies, stakeholders, trading partners and Congress. 

Question 15: 

For the past several years Congress pressed the Administration to focus on a resultsoriented strategy to address the problems that U.S. industry is facing by China's lack of 

enforcement of IP, including in the area of computer software. The USTR was encouraged 

to establish objective, measurable benchmarks that would show success in reducing IP 

infringement in China. What's your view on such metrics and are there commonlyrecognized mechanisms for which you will advocate that will provide information that 

shows whether China is improving its IP regime or not? If so, what are they and will you 

advance them? 

Answer: The Administration has worked hard to improve protection of IPR in China, and 

to reduce the export of infringing products made in China, through a variety of 

mechanisms-including results-oriented dialogue on IPR protection and enforcement, the 

annual Special 301 Report and the notorious markets report. In response to our efforts 

over the past four years, China has taken ccrtain steps to set up mechanisms that can curb 

the problem of software piracy, and we are pressing to see concrete progress on the 

ground. 

With respect to metrics specifically, China committed, in the 2012 Strategic and 

Economic Dialogue to "creat[ingJ an environment ... wherc[ .. J the level of sales of 

legitimate IP-intensive products and services increases, reflecting economic growth and 

in line with the two countries' status as globally significant producers and consumers." 

USTR has been working with rights holders to obtain the information necessary to 

ascertain whether this metric is being met. If confirmed, I will continue to work to ensure 

compliance with the important commitments on IPR that China has made and make 

further progress. 

Question 16: 

The Generalized System of Preferences (GSP) is up for renewal this year. As you know, 

when Congress established GSP it put into statute eligibility criteria. The adherence to 

these criteria is the reciprocity that the U.S. obtains in exchange for the trade preference 

that GSP provides. The criteria are important to America's economic, political, and 

development priorities. I have come to learn that the USTR does not have a practice of 

systematically examining whether countries are meeting the statutory criteria that 

Congress put into the law, with the exception of when the Administration is petitioned to 

conduct a review. Do you think it acceptable that the USTR cannot currently determine 

whether GSP beneficiary countries meet the eligibility criteria found in the law? If not, 

what do you suggest to remedy this situation? Should GSP be renewed, as is, ifUSTR is 

incapable of determining whether GSP beneficiaries meet the conditions that Congress 

established? 
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Answer: As I understand it, USTR conducts extensive activities to review beneficiary 

countries' compliance with the asp statutory eligibility criteria. These activities, carried 

out in coordination with other agencies, include hearings, solicitations of comments from 

the public, and active engagement with foreign governments and domestic stakeholders. 

If confirmed, I would be pleased to discuss with you whether there are ways to improve 

the asp review process. 

Questions from Senator Schumer 

Question 1: 

Despite the tremendous proximity advantage New York has to the Canadian dairy market, 

our industry has been blocked from selling product there. Extremely high Canadian dairy 

tariffs and onerous regulations have frustrated those interested in providing fluid milk, 

Greek Yogurt, cheese and other high-quality dairy products that New York is known for. 

How can we ensure that we use the opportunity TPP is providing to us to finally fully open 

the Canadian dairy market to our products? 

Answer: If confirmed, I will seek to achieve a comprehensive market access package in 

TPP, as President Obama, Prime Minister Harper, and the other TPP Leaders agreed. I 

will consult closely with you and other Members of Congress on how best to eliminate 

the tariff' and non-tariff barriers our dairy producers face in the Canadian market. 

Question 2: 

China continually pegs their currency against the value of foreign currencies, including the 

U.S. dollar, instead of letting it float, meaning its value is not determined by the free 

market, but by the whims of the Chinese government. The ripple effects of this action are 

being felt around the world -and forced to compete with China, the world's second largest 

economy, countries across the Pacific such as Japan have followed suit in manipulating the 

value of their currencies. 

The Trans-Pacific Partnership is eonsidered to be the blueprint for 21st century 

transpacific trade--not just for the countries negotiating the agreement, but for the entire 

region. Especially giving China's recent hints that they are considering joining the 

agreement; will you push for the inclusion of a strong prohibition on currency 

manipulation in TPP? 

Answer: We recognize the importance you and many other Members of Congress attach 

to currency issues. The Treasury Department has the lead on currency issues, but I can 

assure you that the Administration is giving careful consideration to the potential benefits 

and risks of seeking new negotiating objectives for the TPP, recognizing that the 

negotiating goals that we have set for the TPP are ambitious and appropriately so in order 

to achieve a high-standard 21 st century trade agreement. 
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Question from Senator Stabenow 

Question 1: 

The Great Lakes are home to a robust marine transportation system. This movement of 

cargo by U.S.-flag vessels is critical to our economy, as it creates new jobs and supports 

domestic manufacturing. Past administrations have resisted intense pressure from foreign 

nations to eompromise our maritime programs in trade agreements, recognizing the 

potential adverse impacts on our national security and economic interests. As U.S. Trade 

Representative, how would you continue to ensure that the United States can build and 

maintain a U.S.-flag fleet in future trade agreements? 

Answer: I understand the interest in and recognize the sensitivity of the issue and if 

confirmed, will consult closely with you on this matter. 

Questions from Senator Cantwell 

Question 1: 

Mr. Froman, I am very concerned about the current solar trade war going on between 

United States, China and the European Union. Promoting the development and use of 

solar energy and clean energy technologies has been one of my priorities and a priority for 

this administration. As you know, as a result of U.S. investigations into China's solar 

subsidies, the Chinese Ministry of Commerce launched a retaliatory review resulting in 

China announcing its intention to impose antidumping and countervailing duties 

(AD/CVD) on U.S. and EU polysilicon imports to China. In the case of the EU, the Chinese 

government indicated it would make a decision on its AD/CVD once the EU announced the 

tariffs it would apply to Chinese solar panel imports. This week, the EU trade 

commissioner said that the EU would impose a preliminary import tariff of 11.8% on solar 

panels from China. I think this decision bodes well for achieving a resolution of the U.S. 

polysilicon case, whieh would severely impact my Washington State constituents if not 

resolved. 

Because polysilicon contributes a large portion of the value in the solar supply cbain, I 

encourage the Administration to continue working with their Chinese and EU counterparts 

to reach a negotiated solution that is mutually beneficial to the solar industry in the U.S., 

the EU and China. I understand that China plans to make a decision against U.S. 

polysilicon in the coming weeks; consequently it will be important for the Office of the 

United States Trade Representative to engage with China to ensure U.S. clean energy 

manufacturers are not unduly harmed. To that end, is the Administration actively 

engaging in these negotiations? How do you see these negotiations moving ahead? Given 

the recent developments, will you give this matter the urgent attention that it deserves? 
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Answer: If I am confinned, USTR will continue to work with our industry and our 

trading partners to explore ways to resolve a range of concerns relating to trade-related 

practices in the global solar industry. Specifically, we will work to support the dual U.S. 

objectives of(1) ensuring a level playing field for U.S. solar manufacturers and their 

products by enforcing U.S. trade remedy laws and U.S. rights under the World Trade 

Organization agreements, (2) accelerating the adoption of renewable energy technologies 

in the United States and the world, and (3) leveling the playing field so that U.S. clean 

energy manufacturers can compete and win in this growing market. I assure you that this 

is an urgent matter and that if confinned, USTR will explore all avenues to attempt to 

address this matter. 

Question 2: 

Mr. Froman, I appreciate the Administration's commitment to expanding trade 

opportunities for U.S. businesses including our nations' farms and ranches. Exports playa 

critical role in Washington's agriculture sector, leading to more jobs and a healthier 

economy. Through the President's and your leadership we are actively engaged in 

multilateral and bilateral negotiations that can dramatically expand U.S. exports. 

However, as a part of expanding new trade opportunities, it is equally important to ensure 

that our current trading partners live up to existing agreements and adhere to sciencebased protocols, especially as it relates to Sanitary and Phytosanitary (SPS) disputes. The 

World Trade Organization SPS Agreement is an important tool in promoting that 

principle, but it needs to be strengthened to address the size and scope of the barriers 

facing U.S. exports. 

If confirmed, can you please explain how you intend to strengthen the SPS requirements in 

the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership 

and ensure that our partners adhere to these principles, which provide greater 

predictability to trade in a scientific and risk-based manner? 

I am particularly interested to know your response on enforcement given the longstanding 

effort of the U.S. to obtain full market access for U.S. fresh potatoes to Mexico. I 

appreciate your past efforts and the efforts of USTR and U.S. Department of Agriculture 

Animal and Plant Health Inspection Service to resolve this important issue. Can you 

provide me with any insight on the current status of those discussions? Additionally, how, 

as USTR Ambassador, you will work to ensure this is finally resolved? 

Answer: The United States is a strong supporter of the WTO SPS Agreement. If 

confirmed. when significant SPS problems arise that cannot be resolved bilaterally with 

other WTO Members. I will look to dispute settlement in the WTO, as needed. 

In the negotiations of the Trans-Pacific Partnership (TPP), the United States is looking to 

build upon the rights and obligations that TPP countries already have under the SPS 

Agreement and to elaborate on how TPP Parties will adopt and implement SPS measures. 

The SPS Chapter also aims to improve cooperation amongst the Parties on SPS matters. I 
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understand that USTR also has been working to craft a new mechanism that aims to 

resolve SPS matters expeditiously, which is critical for U.S. agricultural exporters. 

With regard to TTIP, we are still in the 90-day consultation period, but the U.S.-EU High 

Level Working Group on Jobs and Growth concluded in its final report that the TransAtlantic Trade and Investment Partnership negotiations would seek to negotiate an 

ambitious WTO-plus chapter, which, among other things, would seek to ensure that SPS 

measures are based on science and would create an ongoing mechanism that would guide 

cooperation on addressing SPS issues as they arise. In parallel with the negotiations, I 

understand that USTR plans to work with the EU to address existing unwarranted SPS 

balTiers. 

Prior to joining the TPP negotiations, Mexico reaffirmed its commitment to sciencebased SPS decisions, in line with the high standards of the TPP SPS Chapter. Along with 

USDA, USTR has urged Mexico to move towards a science-based SPS regime for U.S. 

potatoes. As a part of that effort, USDA has been providing Mexico with significant 

scientific information to support our requests for expanded access for U.S. potatoes with 

controls for several pests that are of quarantine concern to Mexico. Mexico is currently 

in the middle of its regulatory process to consider expanding access for U.S. potatoes. If 

confirmed, I will be sure to continue working along with USDA to ensure that Mexico's 

final regulations for U.S. potatoes are based on science. 

Question 3: 

As you know, Trade Promotion Authority (TPA) sets out the goals for future trade 

negotiations. While TPA has expired, the Administration has indicated that it is 

negotiating as if the 2002 TP A law were still in place. That being the case-the TP A 

objective for Intellectual Property is to obtain a standard of protection similar to that 

found in U.S. law. Current U.S. law regarding data-protection for biologics is clearly set 

at twelve years. So, consistent with TPA and current U.S. law, will the Administration 

table twelve years of data protection for biologics as a part of these negotiations? 

Answer: You are correct that one of the 2002 TP A law objectives for IPR is that the 

United States seek a level of protection in our free trade agreements (FT As) similar to 

that in U.S. law. Biologic drugs are a vital area of pharmaceutical innovation, now and 

in the future. With regard to data protection for biologics, my understanding is that the 

United States has explained our system, including the 12 years of protection related to 

biologics and we're in the process of a thorough discussion with our trading partners on 

that issue. If confirmed, I will ensure that my staff stays in close touch with you as the 

negotiations continue on this important issue. 

Question 4: 

Trade is an essential component of the economy of Washington State, with nearly one in 

every three jobs directly supported by international commerce. It is particularly 
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important to the high-tech industry, and Washington is home to many global leaders in this 

vibrant sector. 

By lowering tariffs on a wide range of tech products, the WTO's Information Technology 

Agreement (IT A) has helped facilitate domestic job creation and growth in the U.S. tech 

sector and U.S. economy over the past decade and a half. In fact, from 1996 to 2008, total 

global trade in ITA products has increased more than 10 percent annually, from $1.2 

trillion to $4 trillion. 

While technological innovation has continued to grow, the list of products covered by the 

agreement has not been updated. As I understand it, trade negotiators have begun to meet 

monthly in Geneva to expand this agreement. If confirmed, do you intend to make this a 

high priority at USTR and within the Administration to ensure expansion of the IT A is 

eompleted by the end of this summer? What concrete steps will you take to get these 

important negotiations across the finish line? 

Answer: ITA expansion is a trade policy priority for this Administration. The ITA 

expansion negotiations are proceeding on an aggressive schedule with monthly meetings 

taking place in Geneva through July. APEC Trade Ministers, at a recent meeting in 

Indonesia, called for completion of negotiations on a list of technology goods proposed 

for duty elimination under the ITA by mid-2013. If confinned as the U.S. Trade 

Representative, I will ensure that USTR continues to engage intensively in the ITA 

negotiations in Geneva to meet this objective. 

But to be clear, the substance of the negotiation will drive the timeline. A successful 

outcome must be commercially significant, and must include key U.S. export priorities, 

such as advanced semiconductors, medical technologies, and software media, among 

others. 

Question 5: 

Inadequate intellectual property rights protection is a long-standing issue between the 

United States and India. However, I am concerned by the more aggressive actions the 

Indian government has taken over the last year and the spill-over effect to third-countries 

that may result. Intellectual property right protection is essential to U.S. innovation and 

domestic production. How do you plan to engage with India to ensure that U.S. companies 

innovations and patents are protected? 

Answer: I share your concern regarding the deteriorating innovation climate in India, 

including recent actions with respect to patents which have only heightened those 

concerns. If confinned, I intend to work closely with other agencies, Congress and 

stakeholders as we consider appropriate actions to take in response. I expect that such a 

response will include engaging bilaterally with India to explore policies of concern as 

they relate to its international commitments, and to discuss alternative and more effective 

approaches to achieving India's domestic policy objectives. This could include 
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engagement in the WTO and other multilateral fora, and could be in coordination with 

like-minded trading partners. 

Questions from Senator Nelson 

Question 1: 

In 2011, we enacted a free trade agreement with South Korea. The agreement eliminated 

Korea's 54-percent tariff on frozen concentrated orange juice, while phasing-out the tariffs 

on fresh grapefruit and freshly-squeezed orange juice over 5 years. These changes present 

a significant opportunity for our citrus growers. But that opportunity will vanish if South 

Korea fails to properly implement the agreement and accept USDA's country-of-origin 

certification for U.S. citrus. What will you do to ensure our citrus growers are benefitting 

from the agreement with Korea? 

Answer: I understand that USTR is aware of the issue related to country-of-origin 

verifications initiated by Korea and has raised its concerns with Korea. If! am 

confirmed, I will work with USDA and the U.S. Embassy in Seoul to address the matter 

to ensure that our producers and exporters have continued access to the opportunities and 

benefits to which they are entitled under the KORUS agreement. 

Question 2: 

Some industry leaders argue that Japan will never allow them to compete on an equal 

footing with domestic producers because of the way they regulate high-tech industries and 

the allowance of anticompetitive cartels between suppliers and customers. If finalized, how 

could a Trans-Pacific Partnership agreement help high-tech U.S. companies overcome 

these types of barriers in places like Japan? 

Answer: Japan's participation in the TPP negotiations provides an important opportunity 

for U.S. high technology exports. Over the past year, USTR has consulted closely with 

Japan to ensure it understands well the high standards under negotiation in the TPP, 

including in the information technology sector. USTR has also addressed priority nontariff measures that affect the high technology sector in its parallel bilateral negotiations 

with Japan. If confirmed, I look forward to working closely with the U.S. industry and 

workers, as well as with the Congress, to secure real market-opening outcomes in Japan. 

Question 3: 

Keeping in mind how U.S. law balances the protection of intellectual property rights with 

the fair use of content and the fair competition of legacy products, what role should current 

U.S. law play in determining the trcatment of intellectual property in future trade 
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agreements? Do you believe negotiators should be given latitude to diverge from current 

law? 

Answer: A robust copyright framework ensures that authors and creators are respected, 

investments (both intellectual and financial) are promoted, that limitations and exceptions 

provide an appropriate balance, and that enforcement measures are effective. I support 

the new approach that USTR has taken to limitations and exceptions in the TPP 

negotiations; that approach is consistent with both U.S. law and international obligations. 

If confirmed, I look forward to continuing to engage with the Committee, Congress and 

stakeholders regarding the appropriate approach to these issues in future trade 

agreements. 

Questions from Senator Menendez 

Question 1: 

The inclusion of Japan in the Trans-Pacific Partnership negotiations has caused some 

consternation among companies and workers in many of our most important economic 

sectors, most notably automobiles. U.S. companies and workers look at our history of 

trade discussions with Japan and are skeptical about the Administration's ability to gain 

increased market access to Japan's notoriously closed economy. Japan is a strong ally and 

we have an important economic relationship, and it there are good economic and 

geopolitical arguments for including Japan-the world's third-largest economy-in a trade 

arrangcment with Pacific Rim countries. Nevertheless, there is great concern over how 

successful the Administration will be in negotiating with Japan and similar countries with 

tightly controlled markets, without watering down the Trans-Pacific Partnership. 

• With regards to the challenges ahcad in working with Japan to open up the automotive 

and insurance sectors and address non-tariff measures, please elaborate on how USTR, 

under your leadership, intends to stick to the high-standards established so far, and 

avoid a rcplay of GATT and the WTO, where TPP risks becoming over-extended and 

weakened by incorporating countries that historically have resisted opening their 

markets. 

• The domestic auto sector is extremely concerned about the inclusion of Japan in the 

TPP, given its traditionally closed auto sector and the U.S. Government's failure over 

decades to convince Japan to open up this sector to foreign competition, while at the 

same time allowing Japanese auto manufacturers to make substantial inroads into the 

U.S. car and truck markets. Why is this time different, wben we have not succeeded in 

the last 30 years? How does the Administration plan to address the auto-specific trade 

imbalances with Japan, and how does USTR plan to address Japanese auto-related 

non-tariff barriers? 
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Answer: I share your serious concerns with respect to Japan's automotive market. That is 

why, this time, USTR negotiated upfront commitments to achieve greater market access and 

level the playing field for U.S. automakers, and why USTR established a process for dealing 

with non-tariff barriers to Japan's auto market which will lead to binding commitments 

subject to dispute resolution. The TPP and the parallel bilateral automotive negotiations 

provide an important opportunity to level the playing field in this important sector for U.S. 

workers and firms. USTR is currently in a 90-day consultation period with Congress and 

other stakeholders about Japan's participation in TPP negotiations. If confirmed I will work 

closely with you to achieve strong results in this critical sector, as well as with respect to 

Japan's non-tariff barriers and in other key sectors such as insurance. 

Question 2: 

The domestic auto sector is not the only industry with concerus about seemingly unfair 

competition from a specific TPP partner. The U.S. domestic textile and apparel industries 

are extremely concerned that inclusion of Vietnam in the TPP will undercut domestic 

industry and also threaten the productive trading relationships that have developed with 

other countries with which we have signed Free Trade Agreements, particularly if the 

Admiuistration does not adhere to the yarn-forward rule of origin that is standard in other 

FTAs. 

• Will Vietnam agree to the yarn-forward rule-of-origin in order to join the TPP? Has 

the Administration assessed the impact on both domestic textile/apparel industry, and 

that of our trading partners (such as CAFTA member and AGOA beneficiaries) of 

including Vietnam in the TPP, both with a yarn-forward rule-of-origin and without? 

How will USTR under your leadership navigate these complex issues in a way that 

avoids unfairly undermining our domestic workers and industry? 

Answer: If confirmed, I am committed to pursuing "yarn forward" rules of origin for all TPP 

countries, including Vietnam. If confirmed, r also will review the impact of our textile 

commitments in the TPP Agreement on other trading partners, including the CAFT A 

countries and AGOA beneficiaries, and consult closely with you and other Members of 

Congress to ensure that our trade agreements support American jobs. 

Question 3: 

I am increasingly concerned about the impact that TPP could have on countries with which 

we already have free trade agreements, and in which we have significant geo-strategic 

interests. There are real concerns among many of our trading partners-for example in 

Latin America-that TPP could undermine the trading relationships they have developed 

with the United States. We have broad interests with these countries, extending well 

beyond our economic/commercial interests, and we need to keep these in mind when 

engaging in new trade negotiations. 

• I am interested in your assessment of the possible impact the TPP could have on our 

free trade partners, and what aetions will you or can you take as Trade Representative 
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to mitigate the negative effects? How do we ensure that future trade deals build on and 

do not compete against our existing agreements? 

Answer: The relationships we have developed through our free trade agreements are 

important for commercial and broader reasons. If confirmed, I am committed to ensuring 

that our new trade agreements, including TPP, serve to build on our existing relationships 

with trading partners in Latin America and other regions in a way that serves to enhance U.S. 

interests. 

Question 4: 

Qn multiple occasions I have raised with the Administration the issue of regulatory 

protection of biologics in the context of ensuring that the TPP is truly a 21st century trade 

agreement with the highest standards of protection for intellectual property. Ideally many 

of us in Congress would like to see a TPP agreement that builds on the strong IP 

protections in the Korea-U.S. Free Trade Agreement, ensuring our nation remains the 

leading innovator of biopharmaceutical products. Such a level of protection enjoy strong 

bipartisan support from Congress, as our highly innovative biopharmaceutical industryas well as the broader high-tech industry-supports millions of high-quality jobs, including 

hundreds of thousands in my own state of New Jersey. It is my understanding that 

negotiations on the pharmaceutical intellectual property text are still ongoing. 

• Given that U.S. law provides for 12 years of protection, what priority will you place on 

ensuring that an equivalent level of protection is adhered to in the TPP agreement, and 

eventually in the Transatlantic Trade and Investment Agreement with the European 

Union? What opposition is USTR facing among our negotiating partners? What is the 

level of data protection for biologics provided under the domestic laws of our TPP 

negotiating partners? What level of protection is allowed for under European law and 

what are the prospects for achieving a high-level of data protection for biologics in the 

TTIP? 

Answer: Biologic drugs are a vital area of pharmaceutical innovation, now and in the 

future. With regard to data protection for biologics in TPP, my understanding is that the 

United States has explained our system, including the 12 years of protection related to 

biologics, with our trading partners. With respect to TTIP, EU law provides strong and 

generally comparable data protection for biologics relative to U.S. law. I understand that 

USTR continues to engage with Members of Congress and interested stakeholders as part 

of the 90-day consultation period and beyond on the treatment of data protection for 

biologics in the TTIP. If confirmed, I will consult closely with you on this important 

issue. 

Question 5: 

With regards to the recent launch of negotiations with the European Union on a 

Transatlantic Trade and Investment Partnership, the decision to launch these talks was 

reportedly based on recommendations made by a high-level working group, led by former 
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United States Trade Representative Ambassador Ronald Kirk and his European Union 

counterpart, EU Trade Commissioner Karel De Gucht. USTR has reported that this 

Working Group found that a deal eliminating tariffs and streamlining regulations would 

benefit both the United States and European Union. 

• Can you elaborate on that statement? Specifically, what do the results of the studies 

that the Working Group performed say about the areas of greatest benefit to each side? 

Is the principal benefit derived from increased efficiencies, or do both sides have 

significant areas of comparative advantage that we will see growth in specific sectors? 

If so, can you give examples? 

I am hearing that each side is considering excluding certain sectors from the negotiation. I 

understand the EU would like to exclude audio visual services and is seeking special 

protection for agriculture. I also understand that Treasury would like to exclude financial 

services regulatory cooperation from the agreement. Administration officials have 

indicated that financial services regulatory issues are important but should be reserved for 

existing dialogues. However, the TTIP could offer an opportunity to establish strong 

bilateral regulatory cooperation, without watering down existing U.S. regulations. 

• Is the Administration considering the inclusion of financial services regulatory 

cooperation in the agreement? 

Answer: We are still in the 90-day consultation period regarding TTIP. I share the belief 

that a high-standard, ambitious, and comprehensive TTIP agreement will generate the 

greatest economic benefit for both economies. If confirmed, I will seek the broadest 

possible agreement. 

Question 6: 

It is my understanding that the European Union is seeking to include air services in the 

TTIP negotiations. Historically the Department of State and Department of 

Transportation have negotiated aviation transportation agreements, and they have 

negotiated liberalized ("Open Skies") agreements with over 110 countries including a 

recent one with the EU. This aviation-specific negotiating framework has worked well. 

• What is the EU's argument for including air services in these negotiations and what are 

their ultimate objectives? Given the unique nature of the U.S. aviation industry and the 

integral part our air carriers play in our national defense, does USTR intend to inform 

EU negotiators publicly that air services agreements will not be part of TTIP 

negotiations? 

Answer: We are still in the 90-day consultation period regarding TTIP. Air services 

have traditionally been covered by Open Skies agreements. I am aware of the 

sensitivity around this issue and if! am confirmed, USTR will remain in close 

consultation with the Finance Committee on these issues as the negotiations proceed 

forward. 
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Question 7: 

During your confirmation hearing I noted that I have been hearing recently from the 

pharmaceutical industry-and other American high-tech companies-about their grave 

concerns over India's inadequate protection for and enforcement of intellectual property 

rights. India is an important ally, but I am very troubled by the Indian government's 

seeming disregard for American companies. Moreover, if other countries see there are no 

consequences to violating the intellectual property rights of American countries, and begin 

to emulate India's actions, our most innovative sectors could face increasing difficulties, 

potentially impacting American exports and jobs. 

• Please elaborate on your response during the hearing on what specific actions you as 

USTR will take to ensure the Administration is doing everything possible to convince 

India to cease this apparent policy of developing its industrial base by taking unfair 

advantage of the hard-earned innovation of American companies and workers? You 

mentioned that it was likely that this issue would come up during the upcoming visit to 

India of Secretary of State Kerry. Can you confirm this, and what will be the 

Secretary's approach? What is the Administration's position on whether India's 

actions, particularly those taken against international pharmaceutical companies since 

early 2012, are consistent with or violate India's commitments under the WTO? The 

United States has sought dispute settlement consultations with India under the WTO 

over solar products. Is the Administration planning to take similar action with regards 

to the pharmaceutical industry? 

Answer: I share your concerns regarding the deteriorating innovation climate in India, 

including recent actions with respect to patents. If confirmed, I intend to work closely 

with other agencies and with Congress as we consider appropriate actions to take in 

response. I expect that such a response will include engaging bilaterally with India to 

explore policies of concern as they relate to international commitments, and to discuss 

alternative and more effective approaches to achieve India's domestic policy objectives. 

This could also include engagement in the WTO and other multilateral fora. I can also 

confirm that such concerns will be highlighted in connection with Secretary Kerry's 

participation in the U.S.-India Strategic Dialogue later this month. USTR continues to 

work closely with the State Department as part of that effort. 

Question 8: 

The Ukraine became the first country since 2005 to be designated a Priority Foreign 

Country (PFC) by USTR in this year's Special 301 report, due to its disregard for 

protecting U.S. intellectual property, particularly copyrighted works. One stark example is 

software, where studies indicate that the piracy rate is 84%! [Shadow Market: 2011 BSA 

Global Software Piracy Study, May 2012) USTR specifically cited the rampant use of 

pirated software by the Ukrainian government itself as one of the reasons for its PFC 

designation. While Ukraine is by no means the only country with a poor regime for 

protecting intellectual property, the PFC designation reflects the utter lack of 

responsiveness by the Ukrainian government to this issue. The U.S. government has been 
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pressing the Ukrainians on this issue for a long time, including signing an IPR Action Plan 

with the Ukrainian government in 2010. But this has led to little progress. The IPR Action 

Plan has not been implemented in any meaningful way. 

• What will you as Trade Representative do to ensure that this issue gets the attention it 

needs from the Ukrainian government? 

Answer: USTR has initiated a section 301 investigation of Ukraine's practices that were 

the basis for its designation as a Priority Foreign Country under Special 301. These 

deficiencies include the use of pirated software by Ukrainian government agencies. If 

confirmed, once the investigation is completed, I will determine what action is called for 

under section 301 to resolve these deficiencies and, more generally, will work to ensure 

that our trading partners respect and enforce intellectual property rights. 

Question 9: 

Expired Trade Promotion Authority included language allowing for entering into a free 

trade agreement with a "foreign country." U.S. policy, consistent with our one China 

policy, the three Joint Communiques, and the Taiwan Relations Act, considers Taiwan's 

status as unresolved. 

• Would the version of Trade Promotion Authority passed by Congress in the Trade Act 

of 2002 have applied to a free trade agreement between tbe U.S. and Taiwan? If you do 

not believe that this version of TP A would have permitted the President to enter into 

negotiations for an FT A with Taiwan, would the provisions of the Taiwan Relations Act 

allow him to do so? 

Answer: The United States and Taiwan have a strong and important bilateral trade and 

investment relationship. If confirmed, I will seek to enhance further our relations with 

Taiwan. I believe we should continue to focus on strengthening our economic 

relationship with Taiwan through our bilateral Trade and Investment Framework 

Agreement. With regard to renewing TP A, I am prepared to work with you and other 

Members of Congress in crafting a mutually satisfactory bill. 

Question 10: 

During your confirmation hearing, I mentioned the simultaneous Senate Foreign Relations 

hearing on Labor Conditions in Bangladesh, which I was chairing, and I expressed my 

grave concerns over the egregious safety violations and lack of worker rights that 

contributed to the tragedy on April 24 with the collapse of the Raua Plaza building in 

Dhaka. This was the deadliest disaster in the history of the garment industry and should 

serve as a wakeup call for all of us. USTR has been reviewing labor rights issues in 

Bangladesh under the current petition since 2007, but these concerns go back several 

decades. Bangladesh does not seem to have made substantial progress in ensuring labor 

conditions improve. 
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• You acknowledged during the hearing that the Administration is at a critical decision 

point on whether to continue Bangladesh's eligibility under the Generalized System of 

Preferences Program, and I appreciate your statement of willingness to work closely 

with me on this issue in the future. Absent significant improvements to labor conditions 

and worker safety, now may be the time for the Administration to consider suspending 

Bangladesh's GSP benefits. When does USTR plan to make and announce its decision? 

I would also appreciate your thoughts on what other leverage mechanisms, aside from 

GSP, the Administration has to encourage Bangladesh to improve its legal, regulatory, 

and enforcement regime related to labor conditions and worker rights, and what 

actions will you as Trade Representative take to achieve this outcome? 

Answer: I was appalled by the horrific loss of life in the recent tragedies in Bangladesh, 

including the April 2013 Rana Plaza building collapse. These tragedies and their 

underlying causes underscore the serious problems in Bangladesh related to worker rights 

and safe working conditions. The Administration has been concerned about the worker 

rights situation in Bangladesh for some time, including issues related to worker safety, 

and has conveyed those concerns on numerous occasions to the highest levels of the 

Government of Bangladesh. These concerns, as you note, are also the subject of an 

ongoing review under the Generalized System of Preferences (GSP) program. The 

Administration will announce next steps in the GSP review by the end of June, and all 

options are being considered, including possible withdrawal, suspension or limitation of 

Bangladesh's GSP benefits. Whatever decision is taken, the Administration will continue 

to work closely with the Government of Bangladesh and other stakeholders to address 

our concerns and work to improve the ability of workers in Bangladesh to exercise their 

rights and work in safe factories. The U.S Government through the Departments of 

Labor and State and the U.S. Agency for International Development is also providing 

technical assistance related to labor issues to Bangladesh. In addition, the United States 

has a deep and extensive bilateral relationship with Bangladesh that provides us many 

avenues to continue our engagement with the government. 

Question 11: 

USTR notes in its 2013 Trade Policy Agenda that the United States will continue to pursue 

bilateral means to ensure full implementation of and compliance with all provisions of the 

Colombia and Panama Trade Promotion Agreements. I am happy to see that the United 

States is monitoring labor issues in both Panama and Colombia and, specifically, working 

closely with the Colombian government under the Action Plan Related to Labor Rights to 

protect union members, end impunity, and improve worker rights. Challenges remain, 

however. According to Colombia's National Labor School, threats against trade unionists 

continue to rise, while government funding for protection dropped 30% between 2011 and 

2012. Furthermore, my understanding is that not even 10% of all murders of union 

leaders result in a conviction. 

• In the context of these ongoing challenges, what is the Administration's perspective on 

the Labor Rights Action Plan with Colombia, which was implemented prior to entry 

into force of the FT A? Is it able to fulfill the role intended? Are we seeing positive 
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results? How will USTR, under your leadership, use the Action plan to help the 

Colombian government address these continuing threats to workers and unions? 

Answer: While the Colombian government has taken numerous important steps to 

advance labor rights in Colombia in fulfillment of the Action Plan, many challenges 

remain. If confirmed, I will ensure that the Obama Administration continues to work 

closely with the Colombian government to make progress in this area, including on the 

issues you raised. 

Question from Senator Carper 

Question 1: 

I have heard from many stakeholders who indicate that a comprehensive Transatlantic 

Trade and Investment Partnership with the EU represents enormous opportunities for U.S. 

manufacturers, farms, and service providers. These opportunities not only exist by way of 

eliminating tariff and non-tariff barriers to trade, but in the form of enhanced regulatory 

cooperation as well. I am concerned there is some discussion to exclude financial services 

from the regulatory dialogue and miss an opportunity to improve the working relationship 

between regulatory bodies that would be mutually beneficial. As you know, we have been 

working over the past several years to enact comprehensive regulatory reform in the 

financial services industry, aimed at protecting U.S. taxpayers and consumers from 

another financial crisis. It is important that we implement these regulations in a 

meaningful way, so that we enhance a robust regulatory system that allows firms big and 

small, global or community-based to compete in the marketplace. However, as the law is 

being implemented, we have seen that many of the rules our regulators are working on, 

have cross-border implications and are instances where greater cooperation and dialogue 

between regulators could result in a more efficient and effective implementation of 

regulations, without weakening their intent. I think it is important that we pursue a 

comprehensive agreement that maximizes our export opportunities. Will you seek a 

comprehensive agreement or will the United State and the EU be taking things off the table 

before negotiations have even begun? 

Answer: I believe that a high-standard, ambitious, and comprehensive TTIP agreement 

will generate the most economic benefit for the U.S. and EU economies. If confinned, 

I will seek the broadest possible agreement. 
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Questions from Senator Brown 

Question 1: 

The "May 10th bipartisan trade deal" reached between the Bush Administration and the 

bipartisan leadership of the Senate Finance Committee and the House Ways and Means 

Committee provided for improved labor, environmental, intellectual property, government 

procurement, services, and investment provisions in free trade agreements. These 

provisions became part of the trade agreements signed with Peru, Colombia, Panama, and 

South Korea. 

I am concerned we are moving backwards from the good steps fonvard made when 

Congress and the Bnsh Administration committed to the May 10th 2007 New Trade Policy. 

I understand USTR is stilI considering how to address the issue of access to medicines in 

the context of the Trans-Pacific Partnership negotiations. 

Will you ensure that a proposal is tabled that is consistent with the May 10th agreement on 

IP and access to medicines? When will USTR submit a revised proposal on this issue? 

Answer: TPP is intended to set high standards and introduce new disciplines. Our 

objective is to protect innovation and ensure access to medicines. We believe we can do 

both, as May 10th agreement did. If confirmed, I also look forward to consulting closely 

with you and other Members of Congress with an interest in this issue to consider how 

best to proceed in the TPP negotiations with these objectives in mind. 

Question 2: 

I am concerned that there is too much of a focus on increasing exports versus decreasing 

imports. President Bush nearly doubled exports in the 5 years between 2002 and 2007, and 

in the process we got the worst trade deficit in the world, because imports grew faster. Net 

trade is one ofthe four components of GDP. In 2011, Bureau of Economic Affairs data 

demonstrate that our trade deficit shaved 4% off GDP. If we had balanced trade, our 

economy would have been a whopping 4% bigger. 

Do you agree that net trade is the important measure rather than increased two way trade? 

Will you, as USTR, make the fundamental goal to balance U.S. trade flows rather than 

merely pursue more trade agreements? 

Answer: I share your concern with the trade deficit, which is why the rebalancing of the 

global economy is so important and a core objective of the 0-20. These macroeconomic 

factors affect the growth rates of our overall exports and imports and underlie the current 

trade deficit. The benefit of free trade agreements is to open markets and to support more 

and better paying jobs. If confirmed, my goal will be to promote economic growth, 

create jobs, and strengthen the middle class here at home by opening more markets for 

exports of U.S. products and services and ensuring that our producers, workers, farmers 

and ranchers have a level playing field on which to compete. 
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Question 3: 

I wrote recently to Ambassador Marantis regarding the importance of "yarn forward" 

rules-of-origin. Senators Cardin, Menendez, Casey, and Durbin joined me, and I know 

Senators Schumer and Burr have raised this, as well. 

I'm concerned that USTR is developing a "short supply" list of products that would allow 

competitors in TPP member countries to use inputs from non-TPP countries, namely 

China, while receiving the benefits of exporting to the U.s. market. 

Parkdale Mills in Cleveland employs cotton pads and other materials that are used in 

apparel, and employs some 500 workers. Parkdale's CEO, Andy Warlick, and President 

Dan Nation, were in Peru last month for the TPP round specifically to monitor USTR on 

this issue. 

Can you assure me as USTR you will not undermine the "yarn forward" rules that have 

supported thousands of jobs, including in Ohio? 

Answer: If confirmed, I am committed to pursuing "yarn forward" rules of origin for all 

TPP countries, making sure our manufacturers can provide fibers, yams, fabrics and 

apparel to the TPP region and to insuring that the benefits of access to the U.S. market 

accrue to our TPP partners. I understand that USTR is also working on a short supply list 

that will allow use of certain yams and fabrics from outside the TPP countries provided 

that yams and fabrics are not commercially available from TPP countries, including, of 

course, the United States. I believe that this approach will allow textile and apparel 

manufacturers from TPP countries, including the United States, to manufacture more 

products that will qualify for duty preference. 

Question 4: 

Since 2010, Mexico's National Water Commission ("NWC" or "Conagua") has arbitrarily 

withheld recertification of piping products manufactured by Advance Drainage Solutions, 

an Ohio company. At the time of de-certification, ADS fully complied with all relevant 

Mexican standards and should have received a certificate of compliance upon request. 

Since that time, ADS has poured significant resources into regaining its certificationincluding filing (and winning) cases against Conagua in the Mexican courts. 

In June 2012, at the behest of USTR and Mexico's Ministry of Economy, Conagua finally 

agreed to review and recertify ADS pipes under a provision of Mexican law known as 

NOM-001, paragraph 5. This provision permits certification for pipe made to standards 

utilized by a NAFTA trading partner. On April 16, 2013, nearly nine months after ADS 

submitted its paragraph 5 application, Conagua rejected ADS's application, and now 

demands that ADS file for certification under a completely different part of Mexican law. 

Conagua's persistent efforts to deny ADS certification appear to violate trade 

commitments made by Mexico to the United States under the WTO and NAFT A. 
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In instances where a trading partner, such as Mexico, refuses to comply with trade 

obligations, how can USTR provide assistance in resolving these disputes and eliminating 

trade barriers? Additionally, if certain countries refuse to abide by existing commitments, 

how can their negotiation of new obligations with USTR be taken seriously? 

Answer: If! am confirmed, USTR will continue its work to resolve and prevent trade 

concerns with Mexico arising from standards-related measures. I understand that a range 

of mechanisms exists to address these issues, including World Trade Organization 

(WTO) and NAFTA, and that new disciplines are being negotiated in the TPP. 

Question 5: 

I am concerned that USTR seems willing to negotiate in the context of trade agreements on 

issues such as tobacco, which is an important public health issue for our country. We 

cannot allow the Administration's urge to conclude trade agreements to undermine the 

authority of our own regulators whose sole job is to safeguarding the public health of 

Americans. How do you plan to handle this matter going forward? 

Answer: If confirmed, I will work with other agencies to ensure that the handling of 

tobacco in TPP is consistent with our trade policy objectives while preserving our ability 

to implement appropriate public health measures. 

Question 6: 

It is my understanding thc Colombia Action Plan Related to Labor Rights, agreed to as 

part of the U.S.-Colombia FT A, is not working as expected and that right now Colombian 

workers are experiencing violations of their rights, including being denied the right to 

organize. I believe complaints have been made to the Colombia government, but the 

Colombian government appears very slow in investigating and addressing these concerns. 

What is your plan for resolving this issue in 2013? Has the Department of Labor official 

assigned to the U.S. Embassy in Bogota been helpful in working with the Colombian 

government on these issues? Is the Colombian government responding to our concerns? 

Do more resources need to be devoted to this work? 

Answer: While the Colombian government has taken numerous important steps to 

advance labor rights in Colombia in fulfillment of the Action Plan, many challenges 

remain. If confirmed, I will ensure that the Obama Administration continues to work 

closely with the Colombian government to make progress in this area, including on the 

issues you raised about the sufficiency of labor law enforcement and the adequacy of the 

resources made available. 

Question 7: 

What more can you share regarding the status of negotiations with the Chinese 

government related to export subsidies provided to Chinese export bases, and specifically 
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auto and auto parts industries? American auto and auto parts workers have proven the 

ability to overcome challenges and compete on a global scale, but such export subsidies, 

prohibited by the WTO, harm U.S. competitiveness. Will the United States soon ask the 

WTO dispute body to formally review this matter? 

Answer: USTR launched a WTO dispute against China in September 2012 challenging 

what appear to be export subsidies that China provides to auto and auto parts enterprises 

located in designated areas called "export bases" in China. USTR held formal 

consultations with China in Geneva in November 2012, and currently the two sides are 

actively engaged in further discussions exploring the most effective way to resolve U.S. 

concerns. 

This is the fourth prohibited subsidies dispute the United States has initiated against 

China. The previous disputes were resolved through the repeal, modification, or 

withdrawal of China's measures without further litigation. Export contingent subsidies 

are unequivocally prohibited by WTO rules and, if confirmed, I will work to ensure that 

we vigorously challenge China's use of them, as well as push China more broadly to 

eliminate its reliance on these policies. 

Question 8: 

One of the most troubling aspects of the developing trade negotiations with the Asia-Pacific 

region and Europe are efforts to weaken our Buy America laws. It is my understanding 

that Canada tabled a proposal during the Singapore round of TPP talks that aims to 

ensure that projects carried out by sub-federal entities with money provided by the central 

government will be open to competition from firms within TPP countries. Along similar 

lines, it has been reported that in the upcoming negotiations with the European Union, 

under TTIP, that the EU may also call for increased access to government procurement by 

the U.S. government. The position of the U.S. government has been to deal with this issue 

through the WTO Government Procurement Agreement (GPA). 

If confirmed as the U.S. Trade Representative, will you commit to standing behind the 

current Buy America laws and oppose any efforts by our trading partners, either through 

TTP, TTIP or at the WTO, to undermine these important laws? 

Answer: The Administration launched the TPP negotiations with the objective of 

achieving a high-standard trade agreement aimed at economic integration across the 

Asia-Pacific region, which includes many of the fastest growing markets for U.S. goods 

and services, as well as important suppliers of U.S. consumer goods. If confirmed, I will 

work diligently to ensure an ambitious outcome in TPP that ensures a result in this area 

that takes account of the multiple U.S. interests, including U.S. consumers and domestic 

produces. 
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Question 9: 

I and others have been appalled by the recent tragedies in Bangladesh, particularly 

because such loss of life could be easily avoided. I greatly appreciate the fact that some 

U.S. companies, such as PVH and Abercrombie and Fitch have signed on to the Accord for 

Fire Safety in Bangladesh and I have written to other U.S. manufactnrers urging them to 

sign on as well. In my letter to the Administration, I noted that this issue has impact on 

the review of GSP that is currently being conducted by USTR. Should such blatant 

disregard for worker safety and worker rights be a reason for the United States to at least 

suspend if not withdraw GSP treatment for Bangladeshi products? How else would you 

approach this issue? 

Answer: I was appalled by the horrific loss of life in the recent tragedies in Bangladesh, 

including the April 2013 Rana Plaza building collapse. These tragedies and their 

underlying causes underscore the serious problems in Bangladesh related to worker rights 

and safe working conditions. The Administration has been concerned about the worker 

rights situation in Bangladesh for some time, including issues related to worker safety, 

and has conveyed those concerns on numerous occasions to the highest levels of the 

Government of Bangladesh. These concerns, as you note, are also the subject of an 

ongoing review under the Generalized System of Preferences (GSP) program. The 

Administration will announce next steps in the GSP review by the end of June, and all 

options are being considered, including possible withdrawal, suspension or limitation of 

Bangladesh's GSP benefits. 

Question 10: 

We have seen in the recent tragedy in Bangladesh how the developing nations' responses to 

global pressures to be a low-cost producer can harm working conditions, constrain worker 

rights, and keep down wages, thereby hurting workers and impeding the development of a 

middle class market for U.S. exports in these countries. Given the importance of ensuring 

the enforcement of labor standards especially in developing nations such as TPP partners 

Vietnam and Malaysia-what is USTR doing to ensure that TPP will achieve a high 

standard with respect to enforceable labor standards in the TPP? 

Answer: If confirmed, I will: seek to ensure that USTR maintains and builds upon 

previous trade agreements in order to ensure that TPP addresses the 21 st-century 

challenges that our workers and businesses face in the Asia-Pacific; pursue a strong labor 

chapter in TPP that ensures respect for internationally recognized labor rights and 

effective enforcement oflabor law, and that is subject to dispute settlement and trade 

sanctions; and work to ensure that all TPP parties, regardless oflevel of development, 

must provide toe the same high level of labor protections. 

Question 11: 

Haiti, on behalf of the world's Least Developed Countries, comprised of 12 percent of the 

world's population but accounting for less than two percent of world GDP, has submitted a 
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proposal to the World Trade Organization's TRIPS Council requesting an unconditional 

extension of the transition period for the implementation of the Trade-Related Aspects of 

Intellectual Property Rights (TRIPS) Agreement until they graduate from LDC status. The 

existing waiver runs out this month and this extension request is allowable under WTO 

rules. 

Over half of the population of the least developed countries lives on less than $1.25 per day. 

These families face serious health challenges, including health risks associated with 

poverty, an increasing health burden from non-communicable diseases on top of 

communicable disease problems, and inadequate resources to provide prevention, 

treatment and care. 

It has been reported that U.S. negotiators have been pushing to weaken the least developed 

counties proposal for an extension. Implementation of TRIPS rules in the lower developed 

countries can drive up medicine prices and hinder to access quality, affordable treatments, 

with devastating health impacts. As USTR, will you support the LDC proposal to extend 

indefinitely the transition period at the WTO? 

Answer: The United States strongly supports an extension of the transition period for 

least-developed countries to apply provisions of the WTO TRIPS Agreement. I 

understand that, following extensive discussions and proposals from LDCs, developed 

countries, and other members, USTR is optimistic that all WTO members, including 

LDCs, are likely to reach consensus on an appropriate extension at the upcoming TRIPS 

Council meeting on June 11-12,2013. If confirmed as USTR, I will support the expected 

consensus decision of all WTO members on this matter. 

Ouestion 12: 

The Obama administration has overseen the highly successful restructuring of the domestic 

auto industry, saving nearly 1 million jobs directly and leading to the commitment by the 

Big 3 automakers to create tens of thousands of new American johs in the future. I am 

concerned that including Japan in the TPP FTA-which would effectively subsidize the 

Japanese direct competitors to the domestic automakers, who may decrease their 

employment of American workers-runs counter to the industry's recovery. Do you share 

this concern and how have you weighed the enormous risk of damaging the domestic auto 

industry relative to possible economic gains in these other sectors? 

Currently, approximately $52 billion (or about 70%) of the U.S bilateral trade deficit with 

Japan is in automotive goods. Past agreements with Japan to give U.S. automakers access 

to the Japanese market haven not been successful. The Japanese automotive companies 

control more than 94% ofthe domestic Japanese market-Japan is the most closed of any 

auto market in the OECD despite the fact that Japanese auto tariffs are at O%? 

What happens if Japan's import penetration rate remains around 6% (where it is now, and 

the lowest of any OECD country) when the tariff phase-out begins? Are you going to build 

into the TPP agreement any mechanism to ensure that we do not begin to provide tariff 
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relief for Japanese autos unless and until Japan demonstrates that it has truly begun to 

open its market? 

Answer: I share your serious concerns with respect to Japan's automotive market. The 

TPP and the parallel bilateral automotive negotiations provide an important opportunity 

to level the playing field in this important sector for U.S. workers and firms. Japan 

recognizes that to become a Party to TPP it will need to make meaningful changes 

affecting the automotive sector. If confirmed, I will work closely with you to achieve 

strong results in this critical sector. 

Question 13: 

The Great Lakes is home to a very vibrant marine transportation system and the domestic 

movement of cargo by those U.S.-flag vessels not only creates jobs but also supports the 

manufacturing heartland of our country. Many of the largest vessels, the "footers" were 

built in Ohio and today our state has two shipyards involved in their repair. One of the 

largest operators of lakers is based in Ohio and our steel, construction and power 

industries depend on the raw materials they move. The American-flag fleet is alive and 

well on the Great Lakes and should remain so for generations to come. Every 

Administration has resisted intense pressure from foreign nations to compromise our 

maritime programs in trade agreements, recognizing the potential adverse impacts on our 

U.S. national, homeland and economic securities. 

Can you assure me, that as U.S. Trade Representative, you will continue the precedent set 

by prior Administrations and ensure that the U.S. can build and maintain a U.S.-flag fleet 

in forthcoming trade agreements?" 

Answer: I recognize the sensitivity of the issue and if confirmed, will consult closely 

with you on this matter. 

Question 14: 

Congress established the trade advisory committee system under the Trade Act of 1974 to 

coordinate and consult effectively with Congress and a wide range of stakeholders. Many 

in Congress (including several Members of this Committee) believe that much can be done 

to enhance the depth, frequency, and quality of our consultations with USTR. 

There are 16 Industry Trade Advisory Committees which are to be, "insofar as is 

practicable, be representative of all industry, labor, agricultural, or service interests 

(including small business interests) in the sector or functional areas concerned." It is my 

understanding that labor unions are not represented on any of them, despite the fact that 

the 16 ITACs represent several industrial sectors where unions represent workers, 

including aerospace, automotive equipment, chemicals, energy, steel, textiles, and others. 

As USTR, would you support including representatives from labor unions on ITACs? 
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Answer: The Trade Advisory System was created by the Trade Act of 1974 (Trade Act) 

to provide advice and guidance on the U.S. trade policy agenda and negotiating 

objectives. 

USTR has worked to update and streamline the Trade Advisory Committees to reflect the 

21st century economy, increasing the representation of services and technology sectors. 

USTR increased the representation oflabor on the Advisory Committee for Trade Policy 

Negotiations (ACTPN) and expanded the size of the Labor Advisory Committee (LAC) 

to increase the number of unions represented. The ACTPN, a tier-one, Presidentiallyappointed committee, includes four prominent labor leaders. The LAC membership 

consists of22 labor organizations and represents a broad range of viewpoints from that 

sector. We recognize that labor unions bring a perspective on areas of concern that may 

not be adequately addressed by industry. If confirmed, I will continue to support the 

active and meaningful participation of labor unions in the advisory committees. 

Questions from Senator Casey 

Question 1: 

A set of rules of origin, correctly developed and implemented, can enhance production and 

employment opportunities among the TPP signatory nations or, if structured poorly, can 

undermine our nation's goals and jeopardize jobs and production here at home. I believe 

we need strong rules in this area, particularly in the auto sector, to provide direct 

incentives to grow the domestic auto supply chain, which will benefit American workers 

and manufacturers. 

As USTR do you believe the NAFT A standard on autos of 62.5 percent should be the 

starting point and the original approach in NAFT A of increasing the percentage over time 

should be part of any TPP deal involving rules of origin for the auto sector? 

Answer: I believe the basis for any TPP deal on autos should be strong and enforceable 

rules of origin that expand auto manufacturing opportunities for the United States and 

ensure that only products that genuinely qualify for preferential treatment receive the 

benefits from the Agreement. If confirmed, I will work to make sure that the TPP meets 

these goals and, will consult with Congress and consider the rules of origin in previous 

U.S. FTAs, including NAFTA, in developing a proposal. 

Question 2: 

Currency manipulation by our trading partners is hugely impactful on growth, job 

creation and strengthening the middle class. A recent study by the Peterson Institute for 

International Economics finds that "[hlalf or more of excess U.S. unemployment-the 

extent to which current joblessness exceeds the full employment level-is attributable to 
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currency manipulation by foreign governments." According to the Peterson Institute, this 

amounts to "1 million to 5 million job losses." 

As we negotiate massive trade agreements, shouldn't there be tough currency disciplines to 

directly address this issue? 

Answer: The Treasury Department has the lead on currency issues, but I can assure you 

that the Administration is giving careful consideration to the potential benefits and risks 

of seeking new negotiating objectives for the TPP, recognizing that the negotiating goals 

that we have set for the TPP are ambitious and appropriately so in order to achieve a 

high-standard 21st century trade agreement, and other ongoing trade negotiations. 

Ouestion3: 

Over 1,200 UAW workers build trucks in a Mack Truck plant in Allentown, Pennsylvania. 

These trucks are sold in the United States and around the world, including Colombia 

where they face high tariffs. I understand that these Mack trucks are at a real 

disadvantage against those built in Mexico, which are then exported to Colombia dutyfree. 

I understand USTR has commenced a process to eliminate the Colombian tariff on truck 

exports to level the playing field for U.S. workers. What precisely are the steps in that 

process? What can we do to speed it up? 

Answer: I understand USTR is working with U.S. industry in order to make a proposal to 

Colombia to accelerate the elimination of tariffs on a range of products, including trucks. 

If confirmed, I will ensure that USTR continues to pursue an agreement with Colombia 

on accelerated tariff elimination. 

Ouestion 4: 

The European Union is requesting that air services be included in TTIP negotiations. 

Historically, the Department of State and the Department of Transportation have 

negotiated aviation transportation agreements. In total, these agencies have negotiated 

liberalized ("Open Skies") agreements with over 110 countries, including a recent one with 

the EU. It seems that this aviation-specific negotiating framework has worked well. 

Will USTR inform EU negotiators publicly that air services agreements will not be part of 

TTIP negotiations?" 

Answer: We are still in the 90-day consultation period regarding TTlP. Air services have 

traditionally been covered by Open Skies agreements I am aware of the sensitivity around 

this issue and if! am confirmed, USTR will remain in close consultation with the Finance 

Committee on these issues as the negotiations proceed forward. 
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Question 5: 

I have heard from two major U.S. industries reccntly-bio/pharma and information 

technology- that they have major concerns about discriminatory practices by India in the 

area ofIP protection and IT procurement. 

What has the Administration's engagement with India been to date on these issues and 

what has been the Indian response? 

Answer: India's manufacturing and IP policies are our top priority in USTR's bilateral 

engagement. USTR has pressed its concems in a variety of bilateral fora, including the 

Trade Policy Forum, Energy Dialogue, and the Information and Communications 

Technology Dialogue, and has joined other trading partners in highlighting these issues in 

multilateral fora such as the WTO. Where appropriate, as in the case ofIndia's solar 

local content requirements, USTR has enforced U.S. rights through WTO dispute 

settlement. These actions underscore the importance of ongoing efforts to explore 

alternative and more effective approaches to achieve India's domestic policy objectives. 

Question 6: 

In an effort to delay price competition for prescription drugs, a notice has been filed under 

Chapter 11 ofNAFTA to overturn settled patent law as it relates to pharmaceutical patents 

in Canada. While I think IP should be protected from expropriation in trade agreements, 

I do not believe that protecting IP from expropriation means that a company has the right 

to assert IP rights when there is no valid patent under a nation's neutral, nondiscriminatory standards. 

Does NAFTA guarantee a right to a patent in circumstance where the patent claim would 

not exist under the domestic law of a NAFTA signatory? 

Answer: Under the NAFT A, I understand that each government must make patents 

available for inventions in all fields of technology, provided that the inventions are new, 

useful, and non-obvious. If confirmed, I would be pleased to discuss further your 

questions about the scope of this provision. 

Questions from Senator Grassley 

Question 1: 

As I told you in our visit in my office, if you are confirmed, I will be happy to work with 

you to open markets and remove barriers for U.S. farmers and businesses. 
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During our meeting, I also provided you with a letter myself, Senator Stabenow, and 24 

other Senators sent to Ambassador Marantis asking that USTR raise the priority of 

resolving regulatory barriers for biotech seeds. 

American farmers have adopted biotechnology seeds to increase production as they help 

feed this world. They need to be able to get their products to market, and they need to 

have the confideuce they can adopt the technology available to them without fear our 

trading partners will erect barriers. 

I would ask that a copy of that letter be included in the record of today's hearing. 

As you probably know, Ambassador Marantis has responded to the letter, but I would like 

to hear your thoughts on the subject. How does USTR intend to work with trading 

partners to improve market access for U.S. crops derived from biotechnology? 

Answer: I agree that agricultural biotechnology is a critical tool to helping farmers 

produce enough food to feed the increasing world population. If confirmed, I will 

continue the work ofUSTR to promote science-based, predictable and transparent 

regulatory regimes in trade agreement negotiations and through other means in bilateral, 

multilateral, and other fora, such as in APEC. In addition, USTR, together with USDA 

and the State Department, will continue to work with like-minded countries to remove 

unwarranted barriers to U.S. exports of agricultural biotechnology products. 

Question 2: 

In regards specifically to the European Union (EU), can you commit to me that if the U.S. 

and EU move forward with a formal trade agreement negotiation, USTR will work to 

remove the regulatory barriers to U.S. biotechnology derived seeds? 

Answer: We are still in the 90-day consultation period regarding TTIP. IfI am 

confirmed, r will seek to address our continuing concerns to promote a timely, 

predictable and science-based EU regulatory approval system to normalize trade in 

agricultural biotechnology products, including seed, through potential negotiations with 

the EU on a comprehensive trade agreement. 

Question 3: 

What steps do you plan to take to remove the barriers our trading partners, such as Russia 

and Taiwan, have put in place against U.S. beef and pork over the use of ractopamine? 

Answer: With the establishment in 2012 of an international standard for the safe use of 

ractopamine, the United States is pressing other countries to adopt those standards, and 

some countries have undertaken regulatory procedures to do so. If confirmed, I will work 

to press to remove unwarranted restrictions against U.S. meat exports, based on use of 

ractopamine, and to ensure that SPS measures are based on science, including a risk 

assessment in accordance with international standards. 
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Question 4: 

In addition to the raetopamine issue, Russia has erected all sorts of unjustifiable barriers 

to U.S. beef, pork, and dairy products. If confirmed, what are the steps you plan to take to 

resolve tbese issues so U.S. farmers don't have to deal with these unjustifiable barriers to 

the Russian market? 

Answer: As a WTO Member, Russia is required to implement the WTO Agreement on 

the Application of Sanitary and Phytosanitary Measures, and the commitments in its 

Working Party Report. These commitments include harmonization of SPS measures with 

international standards, basing measures on science, conducting risk assessments in 

accordance with international standards, and implementing the mechanism for 

recognizing the equivalence ofWTO Members' SPS measures. Russia's membership in 

the WTO gives us additional tools, including the use ofWTO dispute settlement where 

appropriate, to address unwarranted SPS barriers and gives us more effective means to 

address and challenge unwarranted SPS measures. If confirmed, I will use all appropriate 

means, including the full panoply of WTO tools, to push Russia to remove its 

unwarranted restrictions against U.S. meat exports, and for Russia to base its SPS 

measures on science. 

Question 5: 

The European Commission has recently imposed a country-wide anti-dumping duty on all 

U.S. origin ethanol even though anti-dumping decisions require a more individualized rate 

than a broad blanket approach. This step by the EU essentially shuts U.S. ethanol 

producers out of the EU market. This is an unprecedented and unreasonable position by 

the EU. This issue needs to be raised at the WTO. If confirmed, do you plan on 

challenging the EU over this matter at the WTO? 

Answer: I understand that the respective staffs at USTR and the U.S. Department of 

Commerce have followed this matter from its inception. Well before the European 

Commission issued its final decision, U.S. government officials repeatedly expressed 

concerns to the European Commission regarding how it conducted the investigation and 

the methodology it applied. The United States continues to raise these issues in the 

context of our bilateral discussions, as well as in the relevant WTO fora. The 

Administration is committed to vigorously enforcing U.S trade rights, and ensuring that 

WTO members live up to their obligations. I understand that both USTR and Commerce 

are currently evaluating the European Commission's final decision and its methodology 

and are working with the U.S. ethanol producers to consider next steps. If confirmed, I 

look forward to continuing a dialogue on this issue and exploring the best course of 

action to address this issue for our ethanol producers. 
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Question 6: 

Mr. Froman, I want to be clear here. If the President is going to set standards on what he 

says are "tax scams," he should apply the same standard to his friends as he does to his 

opponents. 

On May 4, 2009, the President called Ugland House "the largest tax scam in the world." 

Just months before, in February 2009, the President appointed you Deputy National 

Security Advisor for International Economic Affairs. 

Your financial disclosures indicate you have nearly $500,000 invested in the Cayman 

Islands at the Ugland House. 

What questions did the White House ask about your Caymans Islands investments in 

2009? Were concerns raised about your participation in what the President later called 

"the largest tax scam in the world"? 

If so, can you tell us who raised concerns and what questions they asked? 

Answer: My investment in cvcr was reviewed by ethics officials in the White House 

Counsel's Office in 2009 and I was not directed to divest it. CVCI is a private investment 

fund with an international focus. I did not decide to invest in it because of its location but 

rather to diversify my investments and to increase my investment in international 

emerging markets. I received IRS Form K-Is for this investment and have paid all taxes 

due. r am not aware of any tax benefit that I received by reason of CVCI's location. My 

holdings in cvcr have been reflected on my financial disclosure forms from 2009 to the 

present. Pursuant to my ethics agreement, if confirmed, I will divest my interest in CVCI 

within 90 days of such confirmation. 

Question 7: 

I understand that as part of your employment with Citigroup you were vested in three 

carried interest plans you submitted to the Finanee Committee, upon leaving for the 

Administration in 2009, Citigroup paid you $2 million to waive your rights in two of these 

partnerships "and in recognition of [your] service to Citi in various capacities since 1999." 

What prompted you to waive your rights to these plans in return for a substantial payment 

from Citi? Did someone in the Administration recommend you take this action? 

Do you know what your interest in the "carry plans" were valued at when you waived your 

rights? 

What percentage of the $2 million was based on the value of the carried interest plans and 

what percentage was in recognition of your 10 years of service? 
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In figuring the amount paid to you by Citigroup, was any eonsideration given to the faet 

you would be subject to ordinary income tax rates of 35% instead of the capital gains rate 

of 15%? 

You had a third carried interest that you transferred to your wife. Why was it decided this 

third carried interest would be transferred to your wife instead of being sold to Citi? 

Answer: At the time that I joined the Administration, I consulted with ethics officials and 

followed their advice in determining how to address my various investments. I waived 

my carried interests in the India Infrastructure fund and the Sustainable Development 

Investment fund. The value of these interests and the amount paid in recognition of my 

service to Citi was determined by management at Citi. I do not recall receiving any 

consideration due to tax rates. I transferred my interest in the Citi Infrastructure 

Investments Carried Interest plan to my spouse based upon the advice of White House 

ethics officials. There is no other carried interest or Citi fund held in my wife's name. I 

disclosed the carried interests on my public financial disclosure forms and paid ordinary 

income taxes on the payment I received from Citi. 

Question S: 

On January 16,2009, Citigroup announced losses of$IS.7 billion. The same day, Citigroup 

received $301 billion federal bailout through loan guarantees on its toxic mortgage assets. 

Around the same time, you accepted a bonus from Citigroup for over $2 million for work 

you performed in 200S. 

Were you aware that Citigroup was about to receive a multibillion-dollar federal guarantee 

when you accepted your bonus? 

Can you explain why it is morally acceptable to take more than $2 million out of a 

company that was functionally insolvent and about to receive billions of dollars in taxpayer 

support? 

In response to a written question submitted to you during your Finance Committee review, 

you indicated that you donated "a significant portion of the net proceeds" from the bonus 

you received in 2009 to charity. Could you clarify what you mean by "a significant 

amount"? 

Answer: I was aware of the impact of the financial crisis on Citi and the T ARP 

investment. I was awarded a bonus for 2008 by the senior management of Citi based 

upon my individual performance consistent with the practice at the time. I decided in 

2009 to donate the net proceeds of this bonus to charity, and, to date, have already 

donated approximately 75 percent of those proceeds to charity. 
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Question 9: 

The protection of intellectual property rights is a key component to boosting global 

economies and creating innovative industries and jobs. Countries are able to produce this 

economic momentum by implementing measures to strengthen their intellectual property 

laws and improve intellectual property enforcement. However, a number of countries 

have consistently failed to enhanee their intellectual property regimes and protect 

intellectual property rights, including Russia, China, Brazil and India. 

a. What leverage points would you support as U.S. Trade Representative to bring 

about improvement in these countries anti-intcllectual property policies and 

practices? 

b. In your opinion, should countries like India, Russia and Brazil, that have 

prefereutial access to U.S. markets under the Generalized System of Preferences 

(GSP) continue to enjoy such GSP benefits if they shut U.S. companies out of 

their markets by undermining U.S. intellectual property rights? 

Answer: a. If confinned, I will make the protection and enforcement of intellectual 

property rights a top priority. Opportunities and leverage points to advance this goal 

include our trade agreement negotiations, e.g., the Trans-Pacific Partnership and the 

Transatlantic Trade and Investment Partnership; the annual Special 301 review (including 

the Report, action plans, the notorious markets review, and country-specific reviews); 

bilateral engagement, including IP working groups, with numerous trading partners; 

monitoring the implementation of our Free Trade Agreements and other agreements; 

ongoing work in the WTO and other international organizations; and, fonnal dispute 

settlement. 

b. I understand that "providing adequate and effective protection of intellectual property 

rights" is one of the statutory criteria for beneficiary countries' eligibility for trade 

benefits under the asp program and that there are several ongoing country practice 

reviews on the basis of this criterion. If confinned, I will continue to uphold the use of 

this asp eligibility criterion to press beneficiary countries to improve their protection of 

intellectual property rights. 

Question 10: 

I'd like to ask you about how the International Trade Commission, which enforces trade 

law, is addressing certain infringement cases filed at the ITC under section 337 of the 

Tariff Act. As you know, section 337 is designed to protect domestic industry from abusive 

trade practices by foreign countries and companies importing foreign goods. Recently, 

companies known as patent assertion entities have been using the ITC as an alternative 

means to bring legal action against American companies. Because as a U.S. trade body, the 

ITC has only one remedy-an injunction that stops the importation of goods-these patent 

assertion entities have a big hammer to force American job creators to pay large 

settlements in order to avoid haIting the sale of entire product lines, regardless of the 
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merits of the case. In district court, these patent assertion entities have to prove certain 

factors set forth by the U.S. Supreme Court in the 2006 eBay case before getting an 

injunction. 

a. Do you believe that patent assertion entities should have to abide by the district 

court eBay standards at the ITC if they want to get injunctive relief? Do you 

believe that the ITC and federal courts should share similar standards of review 

for injunctive relief? 

Answer: On June 4, the White House identified legislative recommendations and 

executive actions to "improve incentives for future innovation in high tech patents, a key 

driver of economic growth and good paying American jobs." The announcement 

identified challenges posed by patent assertion entities and several proposed reforms 

bearing on the U.S. International Trade Commission (ITC). In particular, the 

Administration supports changes to the ITC standard to "better align" it with district 

court eBay standards. If confirmed, I stand ready to work with Congress and other 

agencies in support of the White House initiatives. These issues are crucial to our 

economy, American jobs, and innovation. 

Questions from Senator Crapo 

Question 1: 

U.S. stakeholders have consistently advocated for substantive enforcement tools to avoid 

reliance on ineffective WTQ-based dispute-resolution procedures. The USTR's proposed 

"consultative mechanism" in the TPP talks has few adherents in the stakeholder 

community. They believe it does not materially differ from the shortcomings in the current 

WTO process. In your opinion, is an enforcement mechanism a key to a successfully 

negotiated trade agreement? 

Answer: Addressing unwarranted SPS barriers that our farmers and ranchers face is an 

important objective for the Administration. If confirmed, I will seek to ensure that the 

TPP agreement provides us with an avenue for quick and effective resolution of disputes 

related to SPS issues. 

Question 2: 

The U.S.-EU High-Level Working Group Report recommendations, which the 

Administration endorses, calls on building upon: 

"the key principles of the World Trade Qrganization (WTQ) SPS 

Agreement, including with the requirements that each side's SPS measures 

be based on science and on international standards or scientific risk 

assessments, applied only to the extent necessary to protect human, animal, 
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or plant life or health, and developed in a transparent manner, without 

undue delay." 

Do you agree that the standards for any TPP agreement cannot be any less rigorous? Will 

this Administration sign a TPP agreement that does not ensure compliance with WTO SPS 

Agreement standards? 

Answer: In TPP and our negotiations with the EU, obtaining a strong chapter on sanitary 

and phytosanitary (SPS) measures is critical for ensuring that SPS measures do not act as 

unwarranted barriers to U.S. food and agricultural exports. If confirmed, I am committed 

to reaching agreement on SPS chapters in TPP and TTIP that build on and affirm the 

WTO SPS Agreement, promoting science-based decision-making that benefits U.S. 

farmers and ranchers. 

Question 3: 

As a condition to acceding to the TPP talks, Mexico and the United States executed a Letter 

of Intent by which Mexico agreed to lower its non-tariff barriers on beef and potato 

imports. Mexico has not yet fulfilled its commitment on potatoes. According to the USTR 

and USDA, the draft regulations released by Mexico in November 2012 violate the spirit 

and substance of Mexico's commitment. The USTR and USDA submitted comments on 

January 21 objecting to the draft regulation. However, the lack of timeliness requirements 

in Mexico's regulatory process does not ensure timely or satisfactory resolution. Since the 

January 21 submissions deadline, what material progress can USTR demonstrable in 

addressing Mexican market access limits on U.S. fresh potatoes? 

Answer: Prior to joining the Trans-Pacific Partnership negotiations, Mexico reaffirmed 

its commitment to science-based sanitary and phytosanitary (SPS) decisions, in line with 

the high standards of the proposed TPP SPS Chapter. The Administration has urged 

Mexico to move towards a science-based SPS regime for U.S. potatoes. As a part of that 

efIort, USDA has been providing Mexico with significant scientific information to 

support our requests for expanded access for U.S. potatoes with controls for several pests 

that are of quarantine concern to Mexico. Mexico is currently in the middle of its 

regulatory process to consider expanding access for U.S. potatoes. If confirmed, I will 

continue working with USDA to ensure that Mexico's final regulations for U.S. potatoes 

are based on science. 

Question 4: 

What material steps are being taken to address Russia's backsliding on IPR protections 

and beef imports? 

Answer: If confirmed, I will make IPR protection a top priority, which includes 

supporting USTR's ongoing intensive bilateral engagement with Russia on the protection 

and enforcement of intellectual property rights. On December 20, 2012, the United 

States and Russia signed an Intellectual Property Rights Action Plan to improve IPR 
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protection and enforcement. The Plan identifies a broad range of IPR priorities, 

including combating copyright piracy on the Internet, enhancing IPR enforcement, and 

coordinating on IPR legislative reform and other issues. While the bilateral dialogue 

under this action plan has been positive, and engagement through the IPR Working 

Group continues, if confirmed, I will continue to push Russia for additional progress in 

this bilateral forum as well as in the WTO. As regards beef exports to Russia, with the 

establishment in 2012 of an international standard for the safe use of ractopamine, as a 

top priority, the United States is pressing Russia to adopt those standards. If confirmed, I 

will work closely with U.S. stakeholders and not exclude any effective approaches, 

including by using one or more of the full range ofWTO tools, to push Russia to remove 

its unwarranted restrictions against U.S. meat exports and for Russia to base its SPS 

measures on science. 

Question 5: 

What lessons has USTR learned from the Softwood Lumber Agreement and past 

implementation of Canadian obligations in the agreement? What steps is USTR, working 

with USITC and in light ofthe extension ofthe agreement, taking both with respect to 

enforcement and improving Canadian compliance? 

Answer: Strong leadership by USTR and close coordination with the interagency team, 

the Congress and domestic stakeholders has ensured that the 2006 Softwood Lumber 

Agreement (SLA) provides a level playing field for U.S. softwood lumber producers to 

compete. These steps have included enforcement by the Obama Administration of two 

arbitral decisions under the SLA. Today, USTR leads an interagency team of experts 

who devote significant time and resources exclusively to the enforcement and 

implementation of this Agreement. If confirmed, I will continue to require that Canada 

lives up to its obligations under the SLA and will draw upon all available expertise, to 

ensure that the SLA operates in the best interest of the United States. 

Question 6: 

China remains closed to U.S. beef imports. China is potentially a $200 million market for 

U.S. beef. Ongoing and high-level U.S. negotiating teams have long worked to reopen the 

only country still eompletely closed to U.S. beef. What is USTR doing to re-open this 

market to U.S. beef and when should we expect more progress with China? 

Answer: Achieving full market access for U.S. beef and beef products in China remains 

a top priority for the Administration. If confirmed, I will work with USDA to reopen 

China's beef market fully in a commercially viable manner that is based on science and is 

consistent with international guidelines. USTR and USDA met most recently with 

Chinese officials in December 2012 to continue technical discussions on opening the 

Chinese market. With the OlE granting the United States negligible risk status for BSE 

on May 31,2013, USDA and USTR will be seeking to meet with Chinese officials to 

seek to resolve remaining issues. 
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Question 7: 

Recent years have seen increased actions by trade preference program countries to 

undercut thc value of existing intellectual property patents held by U.S. companies. What 

steps can USTR take to ensure our trading partners honor the patent rights of U.S. 

exporters? 

Answer: I am committed to the appropriate use of the full range of U.S. trade policy and 

enforcement tools, including preference programs, to advance the protection and 

enforcement of intellectual property rights. If confirmed, I look forward to working with 

you on this issue. 

Question 8: 

With which countries currently party to a Trade and Investment Framework Agreement 

do you believe the U.S. can launch formal negotiations in the coming year? 

Answer: My understanding is that USTR is evaluating on an ongoing basis its Trade and 

Investment Agreements with other countries for appropriate opportunities to engage in 

more formal discussions regarding the negotiation of a variety of agreements at its 

disposal. At present I am not aware of any countries ready to move to formal 

negotiations, but if confirmed, I will continue evaluating which of our TIF A partners are 

prepared for more formal discussions, and where they make economic and policy sense 

for the United States to pursue. 

Questions from Senator Enzi 

Question 1: 

The United States is the largest exporter of soda ash in the world. The KORUS Free Trade 

Agreement was a significant achievement in reducing tariffs on U.S. soda ash exports to 

South Korea. However, there are significant opportunities for additional gains in market 

access for soda ash to Asia. What opportunities and challenges do you see in securing 

similar duty reductions for U.S. soda ash exports to Japan, China and Taiwan? 

Answer: In the TPP negotiations, I understand that USTR is aiming for rapid elimination 

of tariffs on a broad range of industrial goods. With the potential addition of Japan, three 

key Asia-Pacific markets for soda ash-Japan, Malaysia, and Vietnam-will be covered 

under the TPP. The TPP agreement should therefore provide important new market 

access opportunities for U.S. exporters of soda ash. 

While Taiwan and China are not part of U.S. FTA negotiations at this time, I understand 

that USTR has engaged with Taiwan to support U.S. exporters' and Taiwanese importers' 

efforts to petition Taiwan to reduce its soda ash duties. 
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In terms of challenges, China's large and highly-polluting soda ash industry is dominated 

by state-owned enterprises. Excess capacity in China has led to increased Chinese 

exports that compete with U.S. soda ash exports in Asia and elsewhere. I understand that 

USTR has raised soda ash industry concerns with China, and if confirmed, I will continue 

to seek solutions that increase market access for U.S. soda ash in Asian and other 

markets. 

Question 2: 

The U.S. Department of Agriculture published its newest rule modifying the 

implementation of the Country of Origin Labeling (COOL) law on May 24, 2013. I was 

pleased that this rule was developed with the intention of ensuring that the United States 

remains compliant with its trade obligations. However, should the amended COOL rule be 

challenged, what efforts will the Office ofthe U.S. Trade Representative take to ensure that 

the COOL statute is implemented as Congress intended in statute? 

Answer: The Administration is confident that USDA's new final rule brings the COOL 

requirements into compliance with the World Trade Organization (WTO) ruling, and in a 

manner that is also consistent with U.S. law. Should Canada or Mexico decide to pursue 

further litigation at the WTO, I will, if confirmed, ensure that USTR vigorously defends 

the rule so that retailers eontinue to provide origin information to allow their customers to 

make informed purchasing decisions, as Congress intended. 

Question 3: 

The goverument of India is engaged in a pattern of discrimination designed to benefit its 

domestic corporations at the expense of manufacturing and jobs in America. While Indian 

products get preferential access to the U.S. market, India is blocking our exports by 

disregarding basic property rights and requiring local production of everything from 

computer equipment to solar cells aud other manufactured goods. This is no way for one of 

the world's biggest economies to treat its second largest export trading partner. It sets an 

unfortunate example other countries are sure to follow. 

What is the USTR doing to address this pattern of discrimination, specifically with respect 

to India but also as a wider threat to American jobs and exports? 

Answer: Addressing India's discriminatory manufacturing policies is a priority in 

USTR's bilateral engagement. USTR has pressed its concerns in a variety of bilateral 

fora, including the Trade Policy Forum, Energy Dialogue, and the Information and 

Communications Technology Dialogue, and has joined other trading partners in 

highlighting this issue in multilateral fora such as the WTO. Where appropriate, as in the 

case ofIndia's solar local content requirements, USTR is enforcing U.S. rights through 

WTO dispute settlement. This is supported by and consistent with the work of the 

interagency task force on localization barriers to trade, established by USTR in 2012, to 

further develop and execute a more strategic and coordinated approach to stop these types 
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of practices and prevent this policy direction from being adopted by more countries. If 

confirmed, I will continue to pursue solutions to these discriminatory practices. 

Question 4: 

If confirmed, what will you do as USTR to secure real and timely results for manufacturers 

in America and to ensure India complies with its international obligations? 

Answer: If confirmed, I will redouble USTR's engagement with India on a range of 

issues that affect U.S. manufacturers' ability to compete effectively, seek to identify 

additional opportunities for discouraging India from pursuing measures such as its 

localization provisions in the solar energy sector, and actively support USTR's 

commitment to making use of all available policy tools, including dispute settlement as 

appropriate, to ensure India's compliance with its international obligations. 

Question 5: 

I am concerned about the "balanced" approach (i.e., additional revcnues and spending 

cuts) that the President states is necessary to get our fiscal house in order and U.S. 

businesses have faced an increasing number of trade-related barriers in India-from 

restrictions on FDI, to local content requirements, to government-sanctioned expropriation 

of valuable U.S. intellectual property. It's my understanding that the U.S.-India Trade 

Policy Forum, chaired by the United States Trade Representative and India's Minister of 

Commerce and Industry, is a longstanding bilateral dialogue that exists to address such 

trade and investment issues. While USTR has used this forum to address these, or similar 

issues, in past meetings, there doesn't appear to have been any meaningful progress on 

behalf of U.S. interests. 

When was the last time the U.S.-India Trade Policy Forum met? 

Answer: The United States is using a variety of tools to pursue its commercial interests 

in the context of the U.S.-India bilateral relationship. The U.S.-India Trade Policy Forum 

last met at the ministerial level in late 2010. I understand that USTR has maintained 

engagement with India in recent years through numerous visits by officials of both 

governments, including visits by senior officials and ministerial level exchanges held 

multiple times each year in Washington and on the margins of other international 

meetings. I understand that USTR is conducting a series of expert-level engagements on 

the full range of trade policy issues in the coming months that it expects will help to lay a 

solid foundation for a fruitful ministerial-level session. If confirmed, I will ensure that 

USTR continues to use these types of engagements and works to reenergize the U.S.-

India Trade Policy Forum. 
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Question 6: 

If confirmed, how do you plan to ensure that these meetings are productive for the U.S. in 

that they meaningfully address some of India's more egregious policies that are harming 

U.S. workers, innovators and other job creators? 

Answer: If confirmed, I will reinforce to the Government of India that our bilateral trade 

and investment dialogue remains critical to our broader bilateral relationship, and that 

more regular meetings at the staff level and at senior levels will be necessary for that 

dialogue to work. I will also reinforce sustained USTR engagement to support India's 

ongoing efforts to explore alternative and more effective approaches to achieve India's 

domestic policy objectives. 

Question 7: 

Thanks to our country's dominance in shale development, the U.S. is being called the 

"Saudi Arabia of natural gas." We are already reaping benefits at home, and we are 

poised to playa pivotal strategic role on the world stage too-lessening our trade deficit at 

the same time--by using some of our vast natural gas resources to help our friends 

overseas through exports. There are several top-notch projects ready now, and they are 

willing to start construction as soon as the Administration gives the go-ahead. 

However, there was a two-year lapse between the first export application approval in 2011 

and the second one on May 17. I hear that approvals may start moving faster now, but the 

Administration needs to act ASAP. Otherwise the customers will cut their deals in 

competing markets. Please tell us the status of the process, and what you think would be 

the geopolitical implications if we lost the race to other natural gas producers. 

Answers: As you know, the U.S. Department of Energy (DOE) licenses LNG exports 

under Section 3 of the 1938 Natural Gas Act. Licenses for exports to FTA partners that 

provide national treatment for trade in natural gas are deemed to be in the public interest; 

for non-FTA partners, DOE is to grant application unless it is not in the public interest to 

do so. My understanding is that DOE has a number of applications before it and is 

considering them on a case-by-case basis. 

Question 8: 

Canadian provisions for the protection of intellectual property for biopharmaceutical 

products are out of line with global best practices and woefully insufficient to protect 

incentives for investments in innovations that drive American johs and growth. Canadian 

regulators have created a discriminatory right of appeal that allows Canadian 

pharmaceutical manufacturers to appeal an adverse decision on a challenge to a U.S. 

innovator's biopharmaceutical patent but denies a similar right of appeal to the U.S. 

innovator. Further, Canada's heightened standard for patentable utility for 

biopharmaceutical products is contrary to global hest practices and violates its 

international commitments. 
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That American innovators should face significant intellectual property challenges in one of 

our largest trading partners, a developed country with whom we share a border is 

unacceptable. Yet Canada's intellectual property system is well known across all 

American IP-intensive sectors for weak IP protections and enforcement. Indeed, Canada 

fell well below all other developed countries measured in the Global Intellectual Property 

Center's 2012 International IP index. Canada should not be allowed to serve as an 

example for other countries to flout their IP obligations. 

As USTR, how will you work to ensure that Canada eliminates discriminatory market 

access barriers and conforms to its international commitments with respect to the 

intellectual property protections it affords U.S. innovative biopharmaceutical companies? 

Answer: While I understand that USTR has commented on recent notable improvements 

with respect to Canada in its Special 301 report, I also understand that USTR has had 

longstanding concems on IP issues with Canada more generally. If confirmed, I will 

ensure that USTR continues to work with representatives of the affected companies and 

industries to find possible solutions, and to engage with the Government of Canada on 

these issues. 

Question 9: 

A number of concerns have also been raised regarding the treatment of U.S. 

pharmaceutical patents in India. Weak IP protections, disregarding U.S. patents, and 

discriminatory enforcement practices have all been identified as parts of tbis problem. As 

USTR, how will you work to ensure that India eliminates discriminatory market access 

barriers and conforms to its international commitments with respect to the intellectual 

property protections? How will you work to ensure that India will properly respect and 

enforce U.S. patent rights for pharmaceutical and biological products? 

Answer: I share your concerns regarding the deteriorating innovation climate in India, 

including recent actions with respect to patents. If confirmed, I intend to work closely 

with other agencies and with Congress as we consider appropriate actions to take in 

response. I expect that such a response will include engaging bilaterally with India to 

explore policies of concern as they relate to international commitments, and to discuss 

alternative and more effective approaches to achieve India's domestic policy objectives. 

This could also include engagement in the WTO and other multilateral fora. 

Questions from Senator Cornyn 

Question 1: 

As you may know, a notice has been filed under Chapter 11 ofNAFTA to overturn settled 

patent law as it relates to pharmaceutical patents in Canada. The essence of the claim is 
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that a court judgment finding a patent to be invalid violates the IP protections in NAFT A. 

I think IP should be protected from expropriatiou in trade agreements. I do not believe 

that protecting IP from expropriation means that a company has the right to assert IP 

rights when there is no valid patent under a nation's neutral, non-discriminatory 

standards. Do you agree that NAFT A does not guarantee a right to a patent when the 

patent claim fails under the substantive law of a NAFT A signatory applied in a neutral 

manner? 

Answer: Under the NAFT A, I understand that each government must make patents 

available for inventions in all fields of technology, provided that the inventions are new, 

useful, and non-obvious. If confirmed, I would be pleased to discuss further your 

questions about the scope of this provision. 

Question 2: 

I am concerned that ifNAFTA is held to overrule any nation's domestic patent law applied 

in a neutral and non-discriminatory manner, then careful balances struck in U.S. patent 

law may be at risk. If the Canadian N AFT A challenge succeeds, does it not mean that 

foreign companies are empowered to attack patent decisions issued by U.S. courts in 

accordance with U.S. law? 

Answer: I understand that the notice in question alleges an inconsistency between 

Canadian law and the requirements of Chapter 17 ofNAFTA, and that the outcomes of 

cases are cited only as evidence of Canadian law. The issue, as I understand it, is 

whether Canada's law is consistent with its obligations which include provisions on 

patentability, rather than particular court decisions. As this matter is proposed for 

arbitration, it is not appropriate to offer an opinion on whether this situation could 

constitute an expropriation. 

Question 3: 

If this matter proceeds, will you commit to publicly defending the principle that NAFTA 

protects IP but does not guarantee the right to obtain a patent when a patent would not 

otherwise be recognized under domestic law? 

Answer: Under the NAFTA, I understand that each government must make patents 

available for inventions in all fields of technology, provided that the inventions are new, 

useful, and non-obvious. If confirmed, I would be pleased to discuss further your 

questions about the scope of this provision. 

Question 4: 

The motion picture and television industry is responsible for 123,423 jobs in Texas, 

including indirect jobs, and $4.4 billion in total wages. Copyright is an economic driver 

with nearly 5.1 million U.S. workers employed in the U.S. copyright industries. As USTR, 
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can you assure me that protecting intellectual property rights will he a priority, and will 

you build on the success of the U.S.-Korea FTA, ensuring that the TPP includes the IP 

provisions at least as robust as those found in the Korea agreement? 

Answer: If confirmed as USTR, I will make the protection and enforcement of 

intellectual property rights, including copyright, a top priority. I understand that in the 

TPP, USTR is seeking IPR protection and enforcement provisions comparable to those of 

the KORUS FTA and our other existing free trade agreements in the region, as well as 

new provisions to deal with emerging issues, such as misappropriation of trade secrets. If 

confirmed, I will continue those efforts. 

Question 5: 

I signed onto a letter to the Administration a little over a year ago signaling that the 

current law on the duration of exelusivity for biologic drugs which provides for a 12-year 

term of regulatory data protection should serve as the baseline for the administration's 

objectives in negotiations. Can you commit to strong protections in negotiations for 

intellectual property rights consistent with domestic law? 

Answer: Biologic drugs are a vital area of pharmaceutical innovation, now and in the 

future. In the TPP, with regard to data protection for biologics, my understanding is that 

the United States has begun to explain what is in U.S. law and how our system works, 

including the 12 years of protection related to biologics, with our trading partners. If 

confirmed, I will ensure to consult closely with you on this important issue. 

Question 6: 

In response to a question from my colleague Senator Brown at our June 6th hearing, you 

said that U.S.-EU financial services regulatory discussions would be held on a "parallel 

track" to the actual TTIP negotiations, continuing through existing dialogues. While I 

agree that U.S. regulatory standards should not be weakened in a way that would 

compromise the integrity of our financial system, we must have a productive process for 

discussing and cooperating on key regulatory issues given the global nature of the financial 

services business. I am concerned by recent news that existing U.S.-EU dialogues on 

financial regulatory reform show little sign of harmonization, and that the "parallel track" 

you outline would liken to the status quo, and ultimately exclusion to the negotiation. This 

might lead to missed opportunities through the TTIP to enhance and improve upon current 

regulatory cooperation and potentially open ourselves up to demands from the EU for 

separate discussions on areas ofsensitivity for them. If the purpose of the TTIP 

negotiation is to enhance regulatory cooperation between the U.S. and EU, what is the 

reason for a parallel track? Also, due to the lack of harmonization, can you ensure 

accountahility and progress in financial services regulatory cooperation? 

Answer: One ofUSTR's top goals in TTIP will be to address "behind-the-border" 

barriers to trade and investment in certain sectors. This can be accomplished through 
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provisions that reduce unnecessary regulatory costs while simultaneously meeting our 

legitimate regulatory objectives and maintaining high levels of health, safety, 

environmental, and consumer protection. There is an ongoing robust agenda with 

ambitious deadlines on regulatory and prudential cooperation in the financial sectorboth bilaterally under the Financial Markets Regulatory Dialogue, and under the auspices 

of the 0-20 rubric and international standards setting and other bodies such as the 

Financial Stability Board, the Basel Committee on Banking Supervision, and the 

International Organization of Securities Commissions. I expect that these processes will 

continue to make progress in the near term, including by raising international standards to 

the levels that our financial regulators are now implementing so as to help provide a level 

playing field globally for U.S. firms. 

Question 7: 

China maintains a massive cotton reserve, which is now equivalent to 40% of annual world 

production, by providing domestic subsidies at levels well above prevailing world prices. 

This has a tremendous impact on world markets. Under your leadership, will the 

Administration be willing to insist on modifications to China's internal supports, the 

reserve, and TRQ administration? 

Answer: I understand that USTR and the U.S. Department of Agriculture are closely 

monitoring China's cotton programs and policies. If confirmed, I will be sure to continue 

this work to ensure that China abides by its WTO commitments. 

Question 8: 

U.S. Agriculture exports face not only tariff barriers, but non-tariff barriers as well. Can 

you ensure that sanitary and phytosanitary (SPS) provisions in the current agreements will 

help break down these barriers to our agricultural exports? 

Answer: Addressing unwarranted SPS barriers that our farmers and ranchers face has 

been an important objective for the Administration. In 2009, the Administration 

announccd a special initiative to address SPS barriers through a high profile annual report 

and heightened efforts throughout the year to address these serious problems. If 

confirmed, I will seek to ensure that our trade negotiations and agreements help break 

down unwarranted SPS barriers. 

Question 9: 

In 1991, the United States and Argentina entered into a bilateral investment treaty (BIT) 

that protects investors against the unlawful expropriation offoreign investments and relies 

on the International Center for Settlement ofInvestment Disputes (ICSID) for investorstate dispute settlement. This treaty is part of a significant network of bilateral investment 

treaties and free trade agreements that provide a stable regulatory environment for U.S. 

investors abroad. Azurix, a Houston, Texas based company, had invested in a water 

concession in the Province of Buenos Aires before the government of Argentina effectively 
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expropriated the investment. Azurix sought relief before an ICSID dispute resolution 

panel, but Argentina has refused to pay an August 2009 award which is now worth $242 

million. If Argentina faces no negative consequences for breaching the terms of the U.S.-

Argentina BIT, other countries may also ignore their obligations under U.S. BITs or the 

ICSID Convention. What can the U.S. Government do to mitigate this threat and maintain 

a stable investment environment for U.S. companies investing abroad? What remedies are 

available for companies such as Azurix and the other investors with ICSID awards against 

Argentina, if the Government of Argentina continues to refuse to comply with its 

obligations? 

Answer: Enforcing U.S. rights under trade and investment agreements is a top priority 

for this Administration. The United States is committed to ensuring that foreign 

governments respect and comply with their international legal obligations under U.S. 

bilateral investment treaties (BITs) and the Convention on the Settlement ofinvestment 

Disputes between States and Nationals of Other States (ICSID Convention). The United 

States has repeatedly raised Argentina's failure to comply with final and enforceable BIT 

and ICSID awards with Argentine Government officials at the highest levels and will 

continue to do so. In March 2012, the President suspended Argentina's eligibility for 

trade benefits under the Generalized System of Preferences (GSP) based on the Argentine 

Government's failure to act in good faith in recognizing as binding or in enforcing ICSID 

arbitral awards. As a result of the GSP suspension, Argentina lost duty-free access to the 

United States for approximately $500 million worth of its goods. Argentina's failure to 

comply with outstanding arbitral awards is also one of the factors that has led the U.S. 

Government publicly to oppose the issuance of multilateral development bank loans to 

Argentina. If I am confirmed, USTR will continue to work to ensure that Argentina 

complies with its BIT and ICSID obligations. 

Question 10: 

Another issue tbat I want to flag for you is the incredibly high tariff on footwear. It totals 

$1.6 Billion per year and is the number one source of tariffs received by the U.S. 

government across industries. The reason I raise this with you is that as the 

Administration attempts to negotiate a permanent free trade agreement through the 

Trans-Pacific Partnership (TPP) it will be the first time the U.S. has negotiated with one of 

the key footwear manufacturing nations (Vietnam) and so it is appropriate to raise the 

issue in this negotiation. This Agreement has the potential to permanently end all footwear 

import taxes from TPP partners on day one of implementation. Approximately 99 percent 

of the footwear sold in the U.S. is imported and when you consider that the tax on lowvalue shoes can be as high as 67 percent, you can see how quickly and meaningfully this 

hits consumers' pockets. Unfortunately, previously negotiated trade agreements have not 

done much to alleviate this burden. What is USTR doing to ensure the TPP actually lowers 

duties on imported footwear, thereby eliminating this tax burden on American consumers? 

Answer: The Administration launched the TPP negotiations with the objective of 

achieving a high-standard trade agreement aimed at economic integration across the 

Asia-Pacific region, which includes many of the fastest growing markets for U.S. goods 
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and services, as well as important suppliers of U.S. consumer goods. If confirmed, I will 

work diligently to ensure an ambitious outcome in TPP that achieves a result in this area 

that takes account of the multiple U.S. interests, including U.S. consumers and domestic 

producers. 

Question 11: 

I signed onto a letter to the Administration a little over one year ago signaling that it is time 

for the U.S. to adopt a modern and more flexible approach to apparel rules. Despite that 

letter and others, we've seen very little change in the U.S. negotiating position on apparel. I 

believe success in the TPP will be through expanding trade and investment opportunities in 

all sectors. How do you define success for apparel in the TPP, and do you support more 

commercially meaningful and flexible rules for apparel that are aligned with rules for all 

other products? 

Answer: I know that you and other Members of Congress have a strong interest in this 

sector. I am committed to consulting closely with you to find the appropriate balance 

between the divergent views of different stakeholders on this issue and to ensuring that 

the approach we take in TPP best supports American jobs. 

Question 12: 

As USTR will you dedicate staff to expanding U.S. health care trade? Also, can you commit 

to work with the health care sector to eliminate current barriers to health care products 

and services? 

Answer: I understand that USTR is working in various fora-such as the TPP 

negotiations, the WTO, and APEC-to attempt to address both tariff and non-tariff 

barriers and ensure better market access opportunities for U.S. exporters of healthcare 

products and services. I also understand that USTR is using the tools of U.S. trade policy 

to advance the protection and enforcement of IP rights in the healthcare sector and to 

promote transparency and procedural fairness in foreign government decisions affecting 

market access for healthcare technologies. If confirmed, J will continue to work to 

address barriers in this sector. 

Questions from Senator Thune 

Question 1: 

As our agricultural exporters know all too well, it is often unjustified SPS barriers that 

pose some of the greatest hurdles to expanding U.S. agricultural exports. As such, 

including WTO-plus obligations should also be part of the transatlantic trade negotiations, 

given the pervasive SPS challenges the U.S. faces in that market. However, in order to 

ensure these commitments are meaningful, they must be enforceable so we can hold our 
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trading partners to account. Do you share my view that SPS obligations should be subject 

to legal recourse? How do you view USTR's role in the ongoing inter-agency discussions 

surrounding enforceability of WTO-plus SPS commitments? 

Answer: We are still in the 90-day consultation period regarding TTIP. Addressing 

unwarranted sanitary and phytosanitary (SPS) barriers that our farmers and ranchers face 

will be an important objective for the Administration in negotiations on the Transatlantic 

Trade and Investment Partnership (TTIP). In any trade negotiation, USTR provides 

critical leadership to develop unified Administration policies and negotiating positions. If 

confirmed, I will seek to ensure that TTIP negotiations provide us with an effective 

avenue to resolve SPS issues. 

Ouestion 2: 

I am concerned that Chinese approvals of U.S. agricultural biotech products appear to 

have stalled. In fact, some of our agricultural biotech companies are calling this a "de facto 

moratorium" by China. Do you believe that China is ignoring their WTO obligations to 

review agricultural biotech products without undue delay in a science-based manner? How 

do you intend to address this concerns if approved as U.S. Trade Representative? 

Answer: I understand that USTR has raised concerns regarding China's regulatory 

approval system for agrieultural biotechnology products in a number of high-level 

exchanges with Chinese trade and agriculture officials. If confirmed, I will continue to 

work in coordination with the U.S. Department of Agriculture to ensure that China's 

regulatory approval system works in a timely fashion and makes decisions based on 

science. 

Question 3: 

As you know, some countries are trying to build strategic industries by requiring domestic 

content and/or indigenous intellectual property in order for certain products to be eligihle 

for sale to that country's government, or in some cases in the private sector. How does 

USTR plans to address this practice? Is the U.S.-EU trade agreement an opportunity to 

develop a strong standard in this area? 

Answer: Conditioning market access on domestic content or the use oflocally-owned or 

developed intellectual property not only hurts intellectual property rights holders but also 

creates obstacles to innovation in the country in question. I understand that, in numerous 

fora, USTR has called attention to the damage caused by such policies and successfully 

obtained valuable commitments to respect intellectual property rights and the voluntary 

transfer of technology without government pressure or interference, including by APEC 

Leaders, and in the S&ED and JCCT dialogues with China. The United States has also 

initiated formal dispute settlement, when warranted. Addressing this issue is also part of 

the work of the Administration-wide task force, led by USTR, that is developing a more 

coordinated and strategic approach to localization barriers to trade. In the context of 

ITIP, I understand that USIR continues to engage with Members of Congress and 
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interested stakeholders as part of the 90-day consultation period. The TTIP negotiations 

offer an important opportunity to advance shared U.S. and EU objectives regarding 

strong IPR protection and enforcement in key third country markets, including those 

where such industrial policies are adversely affecting U.S. exporters, innovators and 

creators. If confirmed, I will ensure that USTR continues to engage with Members of 

Congress and interested stakeholders to identify ways in which the United States and the 

EU can enhance our current coordination to address this disturbing trend. 

Question 4: 

I have heard from a number of U.S. businesses that are increasingly concerned about 

efforts by India to promote their economic growth by distorting global trade rules and 

forcing investment to occur in India. Some of these policies include forced intellectual 

property transfer or mandated local production. These types of policies, and the potential 

of other countries replicating India's actions, threaten to inflect great harm on the U.S. 

economy. How do you proposc to address India's actions to ensure that U.S. businesses are 

competing on a level playing field in the Indian market? 

Answer: Addressing such policies is a priority in USTR's bilateral engagement with 

India. USTR has pressed its concerns in a variety of bilateral fora, including the Trade 

Policy Forum, Energy Dialogue, and the Information and Communications Technology 

Dialogue, and has joined other trading partners in highlighting this issue in multilateral 

fora such as the WTO. Where appropriate, as in the case ofIndia's solar local content 

requirements, USTR is enforcing U.S. rights through WTO dispute settlement. This is 

supported by and consistent with the work of the interagency task force on localization 

barriers to trade, established by USTR in 2012 to further develop and execute a more 

strategic and coordinated approach to stop these types of practices and prevent this policy 

direction from being adopted by more countries. If confirmed, I will redouble USTR's 

engagement with India on these issues, seek to identify additional opportunities for 

discouraging India from pursuing such measures, and actively reinforce USTR's 

commitment to making use of all available policy tools, including dispute settlement as 

appropriate, to ensure India's compliance with international obligations. 

Question 5: 

The Internet is revolutionizing global commerce across all sectors of the economy. I believe 

that now is the time to modernize U.S. trade policy to reflect the importance ofthe Internet 

to our global economy. What role do you see trade policy playing to further cross-border 

information flows and the digital economy? 

Answer: Obtaining strong disciplines relating to cross-border data flow is and will 

continue to be a priority in TPP. If! am confirmed, I will seek to include these kinds of 

disciplines-in new trade-agreements as well. 
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Question 6: 

U.S. copyright industries increasingly depend on access to overseas markets, with $134 

billion annually in revenue coming from overseas markets. As U.S. Trade Representative, 

what will you do to support the U.S. copyright industries' access to overseas markets? 

What more can USTR do to address copyright theft in the online space and foster 

legitimate online commerce? 

Answer: If confirmed as USTR, I will make the protection and enforcement of 

intellectual property rights, including copyright, a top priority. I look forward to taking 

full advantage of several opportunities and leverage points to further advance this goal, 

including our trade negotiations, e.g., TPP and Tnp; the annual Special 301 review 

(including the Report, action plans, the notorious markets review, and country-specific 

reviews); bilateral engagement, including IP working groups with numerous trading 

partners; monitoring the implementation of our Free Trade Agreements and other 

agreements; preference program reviews; and efforts in the WTO and other international 

organizations. The United States has also initiated formal dispute settlement, when 

warranted. 

Question 7: 

The White House recently released a series of recommendations related to patent issues, 

including reforms to the ITC proeess for issuing exelusion orders. Do you support the 

White House recommendations in this area and, if so, why? 

Answer: On June 4, the White House identified legislative recommendations and 

executive actions to "improve incentives for future iunovation in high tech patents, a key 

driver of economic growth and good paying American jobs." Several of the measures are 

specific to the U.S. International Trade Commission. If confirmed, I stand ready to work 

with Congress and other Administration agencies in support of the White House 

initiatives. These issues are crucial to our economy, American jobs, and innovation. 

Question 8: 

I joined with a number of my Senate colleagues last year in sending a letter to the 

Administration expressing the view that it is time for the U.S. to adopt a modern and more 

flexible approach to apparel rules. Despite that letter and others, I am aware of very little 

change in the U.S. negotiating position on apparel. How do you define suceess for apparel 

in the TPP, and do you support more commercially meaningful and flexible rules for 

apparel that are aligned with the rules for all other products? 

Answer: I know that you and other Members of Congress have a strong interest in this 

sector. I am committed to consulting closely with you to find the appropriate balance 

between the divergent views of different stakeholders on this issue and to ensuring that 

the approach we take in TPP best supports Americanjobs. 
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Question 9: 

Last year Taiwan was the 11th largest U.S. trading partner, with total trade of $63.2 

billion. Does the Administration ultimately envision a free trade agreement between the 

U.S. and Taiwan? What is the Administration's view on Taiwan's eventual participation in 

the TPP? 

Answer: The United States and Taiwan have a strong and important bilateral trade and 

investment relationship. If confirmed, I will seek to enhanee further our relations with 

Taiwan. I believe we should continue to focus on strengthening our economic 

relationship with Taiwan through our bilateral Trade and Investment Framework 

Agreement. Regarding participation by Taiwan in the TPP, the TPP is open to all APEC 

economies-including Taiwan-that can establish their readiness to meet the high 

standards of the agreement. 

Questions from Senator Burr 

Question 1: 

Over the past year, the government of India has taken a series of actions that have violated 

the patent rights of U.S. companies and undermined global intellectual property regimes. 

If left unaddressed, these actions will continue to cause significant economic harm to 

companies doing business in India and also have the potential to be copied by countries 

around the world, harming U.S. jobs and exports globally. If confirmed, what actions will 

you take within the first 90 days to deal with this significant issue? 

Answer: I share your concerns regarding the deteriorating innovation climate in India, 

including recent actions with respect to patents. If confirmed, I intend to work closely 

with other agencies and with Congress as we consider appropriate actions to take in 

response. I expect that such a response will include engaging bilaterally with India to 

explore policies of concern as they relate to international commitments, and to discuss 

alternative and more effective approaches to achieve India's domestic policy objectives. 

This could include engagement in the WTO and other multilateral fora. 

Question 2: 

India has also adopted export policies on cotton ranging from quota restrictions to 

licensing arrangements to complete bans, and these policies have caused significant 

disruption in world cotton markets. Will the Administration consider all possible options 

to address these trade-distorting policies? 

Answer: I understand that USTR has pressed India on those of its export policies, such as 

export restrictions, that distort global cotton markets. If confirmed, I will reinforce 

USTR's ongoing efforts to engage India actively on these policies, both bilaterally and 
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multilaterally including at the WTO, to ensure that the Administration makes full use of 

all available policy tools. 

Question 3: 

Last year, USTR proposed including a new exception in the Trans-Pacific Partnership 

which would treat tobacco differently than every other product. Not only would this 

proposal harm tobacco producers in my home state of North Carolina and undermine the 

goal of having a comprehensive trade agreement, but it would set a dangerous precedent 

for the treatment of other products in future free trade agreements. The proposal has been 

opposed by USTR Ambassadors from both Republican and Democratic administrations 

and by numerous business and trade organizations. If confirmed, will you assure me that 

you will not seek to implement this proposal? 

Answer: If confirmed, I will work to ensure that handling of tobacco in TPP is consistent 

with our trade policy objectives while preserving our ability to implement appropriate 

public health measures. 

Question 4: 

The U.S.-Colombia Trade Promotion Agreement provides that the United States and 

Colombia may agree to accelerate tariff reductions on items in the agreement. Please know 

that I fully support the acceleration of tariff reductions on U.S. exports of straight trucks to 

Colombia. I see no reason why we cannot get the tariff acceleration done this year and 

create another success under this trade agreement. Will you promise me you will try to 

accomplish this goal within the next few months to give U.S. exports better access into this 

emerging market? 

Answer: I understand USTR is working with U.S. industry in order to make a proposal to 

Colombia to accelerate the elimination of tariffs on a range of products, including trucks. 

If confirmed, I will ensure that USTR continues to pursue an agreement with Colombia 

on accelerated tariff elimination. 

Question 5: 

The European Union committed under the 2009 U.S.IEU Banana Agreement not to return 

to discriminatory and restrictive banana tariff rate quotas and licenses. In 2012, however, 

the EU enacted new legislation requiring licenses and quantitative limits on banana 

imports from certain Latin American countries. Please explain how these new 

requirements will be administered in the EU and affected Latin American countries, 

whether the requirements will discriminate against or restrict U.S. interests in practice, 

and what steps USTR is taking to maintain its case rights until it can ensure full 

compliance with the 2009 Agreement. 

Answer: In 2012, the EU and Latin American countries announced they had settled their 

Bananas disputes. The EU and Central American countries also entered into an FT A, and 
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USIR has sought to clarify with the European Commission aud the governments of 

Central Americau banauas exporting countries how the bauana-related requirements 

under that FIA will be implemented. If confirmed, I will continue to stress that 

implementing measures under that FIA should not place new burdens on u.s. firms. 

Question 6: 

Japan's entry into Trans-Pacific Partnership makes it the single most important trade 

negotiation ever for U.S. pork. A successful TPP negotiation that includes Japan could 

result in the creation ofthousands of U.S. pork industry jobs. However, Prime Minister 

Abe's Liberal Democratic Party (LDP) has expressed concern that Japan's participation in 

TPP would negatively impact Japanese agriculture and would like to exclude pork and 

certain other agriculture products from the agreement. What will you do to guarantee the 

inclusion of pork in negotiations and that all tariffs are eliminated as soon as possible? 

Answer: In a joint statement issued by both governments on February 22, Japau 

confirmed that should it participate in the IPP negotiations, it would subject all goods, 

including pork, to negotiation and would join others in achieving a comprehensive, highstandard agreement. Japau is well aware of the expectations of the current IPP partners 

regarding the IPP's comprehensive trade objectives. 

Question 7: 

Trade Promotion Authority sets out the goals for future trade negotiations. While TPA has 

expired, the Administration has indicated that it is negotiating as if the 2002 TP A law were 

still in place. That being the case, the TPA objective for intellectual property is to obtain a 

standard of protection similar to that found in U.S. law. Current U.S. law regarding dataprotection for biologics is clearly set at 12 years. So-consistent with TPA and current U.S. 

law-will the Administration table 12 years of data protection for biologics as a part of 

these negotiations? 

Answer: You are correct that one of the 2002 IP A law objectives for IPR is that the 

United States seek a level of protection in our free trade agreements (FIAs) similar to 

that in u.s. law. Biologic drugs are a vital area of pharmaceutical innovation, now aud in 

the future. With regard to data protection for biologics, my understauding is that the 

United States has explained aud continues to discuss our system with our trading 

partners, including the 12 years of protection related to biologics. If confirmed, I will 

ensure that my staff stays in close touch with you as the negotiations continue on this 

importaut issue. 

Question 8: 

Due to foreign government subsidies, dumping, and other market-distorting behavior, we 

are seeing steel imports surge into the U.S. market from less efficient foreign producers. 

The steel surge is impeding the domestic steel industry'S full recovery from the recession 

and is costing jobs. As USTR, what immediate steps will you take to stem the current steel 
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import surge and to address the underlying market-distorting behavior of our trading 

partners? What measures will you take to ensure that China and other countries do not 

continue to provide massive subsidies to their steel industries and do not continue to build 

excess steel capacity without regard to market forces? 

A. Answer: This Administration takes your concerns about the global steel capacity 

situation very seriously. USTR and the U.S. Department of Commerce have been 

working, within the bounds of our laws, international rules and limited government 

resources, to address actively foreign government policies that contribute to global excess 

capacity, to enforce U.S. trade remedy laws and utilize U.S. trade rights under the WTO, 

including for example, successfully challenging China's manipulation of exports of raw 

materials critical to the U.S. steel industry. If confirmed, I intend to continue these 

important efforts. 

Over the past year, USTR and the U.S. Department of Commerce have raised concerns 

with China about deteriorating global steel market conditions and Chinese excess 

steelmaking capacity and have urged China to avoid policies such as subsidies and raw 

materials policies that support excess capacity in China. USTR and Commerce are also 

working with like-minded countries such as Canada, Mexico and the European Union to 

address common steel trade concerns. For example, USTR and the U.S. Department of 

Commerce are working with these trade partners to raise the profile of excess capacity 

concerns at the next meeting of the OECD Steel Committee meeting on July I and 2, 

where participation of all the world's major steel producing economies, including China, 

Russia and India, is expected. 

This Administration has also made it a priority to enforce vigorously U.S. trade remedy 

laws. In 2010, the U.S. Department of Commerce announced a series of administrative 

steps to improve and strengthen the administration of the ADICVD laws, particularly as 

they relate to imports from non-market economies. The implementation of those steps is 

nearly complete. In addition, Commerce recently extended the Steel Import Monitoring 

and Analysis program, which was slated to end in March 2013. The Administration has 

also devoted unprecedented resources to the defense of U.S. trade remedy determinations 

when challenged by China and others in the WTO. 

If confirmed, I will continue these intensive efforts, and I would be pleased to discuss this 

issue with you in the future. 

Question 9: 

A growing number of countries are manipulating their currencies-a practice which 

provides foreign exporters with an artificial advantage in international trade and makes it 

much more difficult for American producers to compete at home and abroad. For more 

than a decade, the United States has been urging China to end its policy of keeping the 

RMB undervalued. Now, many other countries, including Japan, are intervening in 

exchange markets, with adverse impacts on U.S. exports and jobs. This week, I joined five 

other Senators in introducing the Currency Exchange Rate Qversight Reform Act of 2013 
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to address currency manipulation. Are you committed to working with other countries and 

using both the WTO and the TPP to address government intervention in currency policies? 

Answer: We recognize the importance you and many other Members of Congress 

attach to currency issues. The Treasury Department has the lead on currency issues, but I 

can assure you that the Administration is giving careful consideration to the potential 

benefits and risks of seeking new negotiating objectives for the TPP, recognizing that the 

negotiating goals that we have set for the TPP are ambitious and appropriately so in order 

to achieve a high-standard 21st century trade agreement. With regard to the WTO, the 

United States has welcomed the discussion on the important topic of the relationship 

between exchange rates and trade, and where the Administration has emphasized the 

importance of market-determined exchange rates in supporting growth and trade. 

Question 10: 

I am pleased that the Administration, in its notification to Congress on the Transatlantic 

Trade and Investment Partnership, said that this is to be a "comprehensive trade and 

investment agreement." In a February 2013 press briefing on the TTIP agreement, you 

also stated that the "intent is to negotiate a comprehensive agreement, tariffs and non-tariff 

barriers, and very importantly, looking at the regulatory barriers and the barriers that our 

different standards pose to further integration of our economy." Do I have your assurance 

that in negotiating on this agreement, you will be including negotiations on both 

agriculture and financial services? 

Answer: I believe that a high-standard, ambitious, and comprehensive TTIP agreement 

will generate the most economic benefit for the U.S. and EU economies. If confirmed, 

I will seek the broadest possible agreement. 

Questions from Senator Isakson 

Ouestion 1: 

How do you plan to move forward with the regional TIFAs with both the East African 

Community (EAC) and the Economic Community of West African States (ECOWAS)? 

Answer: I understand that USTR is pursuing an ambitious Trade and Investment 

Partnership (TIP) with the East African Community (EAC), and that as part of the TIP, 

the Administration and the EAC intend to explore negotiating_an investment treaty and a 

trade facilitation agreement, as well as pursuing continued trade capacity building 

assistance and a commercial dialogue. I believe that this Partnership should help to 

advance U.S. economic relations with the EAC and its Members and if confirmed, I will 

work to advance work on the TIP. 
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Regarding ECOWAS, I understand that USTR is currently negotiating a U.S.-Economic 

Community of West African States (ECOWAS) Trade and Investment Framework 

Agreement (TIF A). If confirmed, I will work to complete the TIF A so that it can serve as 

a tool for enhancing trade and investment relations with ECOWAS and its Member 

States. 

Question 2: 

Do you foresee engaging in trade talks with the South African Development Community 

(SADC) or perhaps on a bi-Iateral basis with South Africa? 

Answer: The United States currently has no free trade agreements (FTAs) with any of 

the countries in sub-Saharan Africa. I understand that given sub-Saharan Africa's 

specific circumstances, including its generally low levels of economic, administrative, 

and regulatory development, many countries in the region have not been willing or able 

to enact the types of policies and reforms that would be required for a comprehensive, 

high- standard FTA with the United States. In view of the near-term challenges of 

completing FTAs with sub-Saharan African partners, the Administration has pursued 

alternative means of strengthening our trade and investment relationships with key 

African partners, including trade and investment framework agreements (TIF As), 

bilateral investment treaties (BITs), and the EAC Trade and Investment Partnership 

(TIP). 

If confirmed, I will continue to use TIF As, BITs, and the TIP to expand market access, 

strengthen the links between trade and economic development strategies, encourage 

greater foreign investment, and promote regional economic integration and growth. I 

plan to use these mechanisms to help transition from U.S.-Africa trade and investment 

relationships based on one-way trade preferences to deeper, more reciprocal partnerships, 

including between U.S. and African businesses. 

The Administration will continue to explore the potential for trade and investment 

agreements with sub-Saharan African countries, including South Africa and those in 

SADC. In further exploring such agreements with sub-Saharan African countries, the 

Administration will consult closely with Congress and with other constituencies, 

including the business community. 

Regarding South Africa specifically, I understand that the United States signed an 

amended TIFA with South Africa in 2012. If confirmed, I plan on using the South Africa 

TIF A to discuss, resolve, and cooperate on a wide-range of bilateral trade and investment 

issues. I would also plan to use the regional U.S.-SACU Trade, Investment, and 

Development Cooperative Agreement, under which the Administration has worked with 

South Africa and its other SACU Member-State partners (Botswana, Lesotho, Namibia, 

and Swaziland). 
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Question 3: 

South Africa has placed antidumping duties on imports of frozen bone-in chicken pieces 

from the United States for over 12 years, effectively pricing U.S. poultry out of the market 

in South Africa, and allowing others such as Brazil to gain market share. As USTR, how 

would you pursue market access in South Africa for U.S. poultry producers? 

Answer: I appreciate the importance of this issue to the U.S. poultry industry and believe 

it essential to press for our industry'S access to the South African market. For example, if 

confinned I will ensure that USTR continues to monitor closely the ongoing South 

African domestic litigation challenging the antidumping duty order. In the last year, 

South African courts have already found serious faults with the continued existence of 

the order. I believe USTR should continue to use these developments to press South 

African authorities to take corrective action. 

I would also note that it is critical that USTR maintain sustained engagement on this issue 

in our existing mechanisms, such as in our Trade and Investment Framework Agreement 

with South Africa and in the relevant WTO Committees. If! am confinned, I will ensure 

that USTR will continue to raise this issue frequently and maintain vigilance until we 

obtain a positive outcome for our poultry industry. 

Question 4: 

Do you believe AGQA's renewal presents opportunities for the U.S. to make progress on 

issues related to South African barriers to trade such as the antidumping mcasures on 

poultry? 

Answer: Some are raising questions about the fairness of providing duty-free access to 

the U.S. market for an advanced country like South Africa when some U.S. products, 

including poultry, face restricted or diminished market access. If confinned, I will ensure 

that in our discussions with sub-Saharan African countries, including South Africa, 

USTR will continue to use AGOA as a tool to support the efforts of African countries 

undertaking economic, political, and social refonns, including trade liberalization. 

Because AGOA provides an important incentive for countries to undertake such refonns, 

USTR should continue to discuss issues that inhibit trade such as the South African 

antidumping duties on U.S. poultry. 

Question 5: 

Due to its unique political status, Taiwan's integration into the global economy is somewhat 

handicapped and its economic dependenee on the People's Republic of China has increased 

in recent years. Do you believe that Taiwan's participation in the Trans-Pacific 

Partnership (TPP) would be an effective counterweight to this trend? Is the 

Administration supportive of Taiwan's participation in the TPP? 
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Answer: The United States and Taiwan have a strong and important bilateral trade and 

investment relationship. If confirmed, I will seek to enhance further our relations with 

Taiwan. I believe we should continue to focus on strengthening our economic 

relationship with Taiwan through our bilateral Trade and Investment Framework 

Agreement. 

Question 6: 

The United States restricts foreign ownership of domestic airlines to 25 percent. This 

restriction has been in place since 1926 for both national security and safety reasons. As 

both U.S. and EU flag carriers face increased competition from Gulf and Chinese airlines, 

the European Commission has indicated it would begin a review of EU restrictions and also 

seek a relaxation of the U.S. ownership restrictions. Generally, do you have a view of 

whether the ownership restrictions on U.S. airlines should be loosened? 

Answer: Air services have traditionally been covered by Open Skies agreements, not 

trade agreements. The issues you raise, surrounding ownership restrictions and 

competition, are complex and raise various sensitivities. If! am confirmed, USTR will 

remain in close consultations with the Finance Committee on these issues 

Question 7: 

One of the concerns that I hear from a number of my constituents is that this issue will 

come up in the context ofTTIP. As you know, botb DOT and State have conducted 

negotiations on any bilateral agreements relating to the airline industry, because they have 

both the historical knowledge and the technical expertise of the industry needed to ensure a 

fair agreement. Do you think, should this issue come up, that USTR should be the lead 

negotiator on this topic or would you defer to DOT and State to negotiate this important 

provision? 

Answer: We are still in the 90-day consultation period regarding TTIP. Although USTR 

will be the lead negotiator on TTIP, the agency has a close working relationship with the 

Departments of Transportation (DOT) and State, and will involve them directly in any 

discussion of this topic. Air services and ownership issues have traditionally been 

covered by Open Skies agreements, not trade agreements. If I am confirmed, USTR will 

remain in close communication with the Finance Committee as the negotiations proceed. 

Question 8: 

U.S. carriers increasingly face competition from state-owned enterprises. Emirates, for 

example, is owned by the government of Dubai. Etibad is owned by the government of Abu 

Dhabi. Both carriers have ambitious and aggressive expansion plans, and enjoy funding 

from their very wealthy governments. U.S. carriers, however, are not government funded. 

In terms of leveling the playing field, what policies will you pursue to allow for U.S. flag 

carriers to compete head to head with carriers like Emirates and Etihad? 
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Answer: The Administration supports efforts to level the playing field for U.S. airlines, 

including through supporting the efforts of the Departments of State and Transportation 

in the negotiation and implementation of robust Open Skies Agreements. 

Questions from Senator Portman 

Question 1: 

Since the implementation of the U.S.-Australia FT A, Australia has been one of the top ten 

destinations for U.S. pork exports valued at $209 million in 2012. Pork is the top U.S. 

agriculture export to Australia. However, the U.S. only has partial access in Australia. 

What will USTR do to eliminate Australia's non-science-based SPS barriers? 

Answer: Addressing bilateral sanitary and phytosanitary (SPS) issues is a top priority for 

the Administration, and, if confirmed, I will work with USDA to address Australia's 

unwarranted restrictions on imports of U.S. pork products. 

Question 2: 

The proposed Transatlantic agreement has the potential to create enormous export 

opportunities for U.S. manufacturers, farmers and small businesses, which means more 

jobs in places like Qhio. However, I am concerned that the some are already seeking to 

exclude certain sectors from the agreement. The Europeans are seeking to exclude audio 

visual products and some agriculture goods while some in the United States would like to 

exclude financial services. I think it is important that everything be on the table and that 

we pursue a comprehensive agreement that will maximize our export opportunities. Will 

you seek a comprehensive agreement or will we be taking things off the table even before 

the negotiations have officially begun? 

Answer: We are still in the 90-day consultation period regarding TTIP. I believe that a 

high-standard, ambitious, and comprehensive TTIP agreement, as outlined in the U.S.-

EU High Level Working Group on Jobs and Growth's Final Report, will generate the 

greatest economic benefit for the U.S. and EU economies. If confirmed, I will seek the 

broadest possible agreement. 

Question 3: 

The U.S. Departments of Defense and Energy and the European Commission have 

identified more than a dozen materials that have been identified as critical or strategic to 

national security, clean energy and the economy. These key materials drive leading-edge 

technologies and future innovations. Favorable access to these critical materials provides a 

technological advantage to the U.S. and its European Union trading partners. Yet our EU 

trading partners continue to impose unnecessary supply and regulatory restrictions, which 

jeopardize use ofthese critical materials and stifle innovation. The interests of the EU 
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should be aligned with the U.S. for a supportive critical materials policy. Will you as the 

U.S. Trade Representative raise to a high priority the necessity of including a favorable 

critical materials policy in the negotiations with the EU? 

Answer: The United States is working cooperatively with the EU on both DOE-led and 

other projects to enhance diversity and security of the supply of raw materials critical to 

high-tech, clean energy and other applications. For example, USTR has worked closely 

together with the EU and other countries such as Japan and Mexico to challenge at the 

WTO China's export restrictions on rare earths and other critical materials. 

We are still in the midst of the 90-day consultation period for TTIP. That said, if 

confirmed, I will work to ensure that barriers to trade and efficient use of critical 

materials in our two economies are identified and reduced or eliminated through the 

negotiation of high-level disciplines or other appropriate means. 

Question 4: 

Access to reliable supplies of raw materials is critical to U.S. steel manufacturers and other 

U.S. industries. USTR's recent efforts to challenge China's restrictions on exports of 

steelmaking raw materials and rare earths at the WTO are commendable. However, many 

other countries-including Russia, India and Ukraine--continue to impose restrictions on 

raw materials, including export taxes on materials that are essential to manufacturing. 

What does USTR intend to do about countries that restrict exports of raw materials, to the 

detriment of U.S. manufacturing industries and their workers? 

Answer: I understand that USTR has been active in addressing export restraints on raw 

materials, including those used in steelmaking. Under WTO rules, prohibitions and 

restrictions on export, such as export bans and quotas, are generally prohibited. While 

export taxes are generally permitted, USTR negotiated commitments to reduce or 

eliminate export taxes on key raw materials such as steel scrap in the WTO accessions 

protocols of Russia, Ukraine and Vietnam. Where countries have either imposed or 

proposed other export restrictions on steelmaking raw materials, I understand USTR has 

engaged with those countries through dialogue and has, in the case of Russia, 

successfully discouraged the imposition of new export restraints on steel scrap. USTR 

has also raised concerns with India about its export taxes on iron ore, and with Ukraine 

on what appear to be new export restrictions on steel scrap. 

USTR also seeks immediate elimination of all export duties in free trade agreement 

negotiations, including TPP. 

In addition, through the OECD, the United States is working with the EU, Japan and 

other like-minded countries to raise awareness of the detrimental impact of export 

restrictions and to explore policy alternatives for conservation efforts that recognize the 

interdependent nature of trade in raw materials. 
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If confirmed, I will support continuation of these efforts to remove restrictions and 

enforce U.S. trade rights through WTO dispute settlement, if necessary. 

Question 5: 

As you may know, USTR has been working with my office, Sen. Brown and the Mexican 

government to address persistent market access problems in Mexico facing Advanced 

Drainage Systems, an Ohio-based producer of a certain type of corrugated pipe 

(corrugated high-density polyethylene pipe). Given Mexico's obligations under the WTO 

and NAFT A, what steps can USTR take to resolve this and other persistent non-tariff 

barriers to trade, su~h as those being imposed by Mexico's National Water Commission? 

Moreover, what steps can USTR take to ensure that future agreements with Mexico and 

other trading partners avoid unnecessarily barriers to trade? 

Answer: IfI am confirmed, USTR will continue its work to resolve and prevent trade 

concerns with Mexico arising from standards-related measures. I understand that a range 

of mechanisms exists to address these issues, including World Trade Organization 

(WTO) and NAFTA, and that new disciplines are being negotiated in the TPP. 

Question 6: 

The U.S. health care sector holds enormous potential for global growth. Yet this sectorwhich is enormously important to Ohio-continues to face many trade barriers all around 

the world. Will you commit to work with the health care sector to eliminate current 

barriers to the open global flow ofworld-cIass health care products and services? 

Answer: I understand that USTR is working in various fora-such as the TPP 

negotiations, the WTO, and APEC-to attempt to address both tariff and non-tariff 

barriers and ensure better market access opportunities for U.S. exporters of health care 

products and services. I also understand that USTR is using the tools of U.S. trade policy 

to advance the protection and enforcement of IP rights in the health care sector and to 

promote transparency and procedural faimess in government decisions affecting market 

access for healthcare technologies. If confirmed, I will continue to work to address 

barriers in this sector. 

Question 7: 

As you may know, USTR has been working with my office, Sen. Brown and an Ohio 

company that works with liquid crystal polymers (LCP) and is seeking inclusion in the 

Information Technology Agreement (ITA). Do you consider conclusion of IT A expansion 

this year a high priority for the Administration? Will your negotiators continue to 

advocate for the inclusion ofLCPs in the ITA expansion talks? 

Answer: IT A expansion is a trade policy priority for this Administration. The ITA 

expansion negotiations are proceeding on an aggressive schedule with monthly meetings 

taking place in Geneva through July. APEC Trade Ministers, at a recent meeting in 
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Indonesia, called for completion of negotiations on a list of technology goods proposed 

for duty elimination under the ITA by mid-2013. Ifconfirmed, I will ensure that USTR 

continues to engage intensively in the ITA negotiations in Geneva to meet this objective. 

USTR is advocating for the inclusion of key U.S. export priorities-including liquid 

crystal polymers-in the negotiated product list. As we work to advance U.S. economic 

interests in the ITA expansion negotiations, we will continue to consult intensively with 

Congress and members of the U.S. business community. 

Question 8: 

The United States is the most competitive supplier of services in the world, but foreign 

barriers and discrimination prevent our firms from reaching their potential for creating 

new American jobs. The rules for international trade in services were written over twenty 

years ago. They have not kept up with rapid advances with the Internet, cloud computing, 

international express delivery, and the phenomenon of supply chains. There is an urgent 

need for our trade agreements to reflect today's technological and business realities. If 

confirmed as USTR, will you pledge to make it a priority in all our trade negotiations to 

bring our trading partners' commitments in services up to 21st century standards? 

Answer: I recognize that significant changes have taken place in the global market for 

services since the first services trade agreement was concluded almost 20 years ago. USTR 

has been working hard to ensure that our trade agreements adapt to address new challenges 

that are emerging as a result. These efforts can be seen in all of our recent bilateral trade 

agreements, as well as in the ongoing TPP and newly launched Trade in Services Agreement 

(TISA) negotiations, where USTR is pursuing state of the art provisions on services, 

telecommunications, e-commerce and other areas that support trade in services. If 

confirmed, I will indeed make it a priority to continue these efforts and build upon them in 

future agreements. 

Questions from Senator Toomey 

Question 1: 

I authored a bipartisan, bicameral congressional letter last year asking USTR to begin 

negotiations to remove the very high tariff on U.S. truck exports to Colombia. I want to 

level the playing field for my constituent Mack Trucks, whose exports to Colombia compete 

with Mexican exports that face no tariff. I believe USTR could complete the process and 

have the tariff eliminated in a matter of just a few months. Will you actively pursue 

eliminating this tariff and help increase American exports to Colombia? 

Answer: I understand USTR is working ,vith U.S. industry in order to make a proposal to 

Colombia to accelerate the elimination of tariffs on a range of products, including trucks. 
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If confinned, I will ensure that USTR continues to pursue an agreement with Colombia 

on accelerated tariff elimination. 

Question 2: 

I understand that there has been a serious deterioration of intellectual property protection 

in India over the past few years. This includes the revocation of well-established 

pharmaceutical patents, lack of enforcement on infringed patents, and the threat of 

compulsory licensing for biotech and pharmaceutical products. This seems like a very 

aggressive trend by India to target some of our most innovative companies. What tools 

does USTR have to address India's actions and how is the Office ofUSTR prepared to 

utilize them? 

Answer: I share your concerns regarding the deteriorating innovation climate in India, 

including recent actions with respect to patents. If confinned, I intend to work closely 

with other agencies and with Congress as we consider appropriate actions to take in 

response. I expeet that sueh a response will include engaging bilaterally with India to 

explore policies of concern as they relate to international commitments and to discuss 

alternative and more effective approaches to achieve India's domestic policy objectives. 

This could also include engagement in the WTO and other multilateral fora. 

Question 3: 

A notice of intent to arbitrate was filed under NAFT A to require Canada to recognize a 

patent even though their judicial system found that no patent should be granted under 

Canadian law. In your opinion, does NAFTA ever require a nation to issue a patent when 

that patent claim fails to abide by a nation's substantive law that is applied in a neutral 

manner? 

Answer: Under the NAFT A, I understand that each government must make patents 

available for inventions in all fields of technology, provided that the inventions are new, 

useful, and non-obvious. If confinned, I would be pleased to discuss further your 

questions about the scope of this provision. 
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STATEMENT OF HON. ORRIN G. HATCH, RANKING MEMBER 

U.S. SENATE COMMITIEE ON FINANCE HEARING OF JUNE 6, 2013 

NOMINATION OF MICHAEL FROMAN TO BE 

UNITED STATES TRADE REPRESENTATIVE 

WASHINGTON - U.s. Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance 

Committee, today issued the following statement during a Senate Finance Committee hearing 

considering the nomination of Michael Froman to serve as U.S. Trade Representative: 

I look forward to hearing Mr. Froman's testimony and finding out more about his 

qualificatians for this very important position. 

However, before talking obout trade policy, I want to take a few minutes to talk about 

the wide disparity between the Obama Administration's rhetoric and the actions taken by 

administration officials. 

This has particular relevance ta Mr. Froman's nomination. 

A few months ago, when the Finance Committee was considering the namination of Jack 

Lew to be the Secretary of the Treasury, we learned that he had invested in a Cayman Islands 

hedge fund located in the now infamous Ugland House that so many Democrats have decried as 

a tax haven. 

At the time, we reminded people that, in 2008, while campaigning for President, thenSenator Obama said that the Ugland House was "either the biggest building in the world or the 

biggest tax scam in the world." 

And, throughout the 2012 campaign, President Obama repeatedly attacked Mitt 

Romney for having funds invested in the Caymans. In making such investments, Governor 

Romney was, in the words of the Obama Campaign, betting against America. 

Yet, the President had no problem nominating someone who made similar investments 

to be Treasury Secretary. 

As a result of our vetting process, we have now learned that Mr. Froman has actively 

invested roughly half a million dollars in the exact same hedge fund located at the Ugland 

Hause. 

Mr. Froman is, in fact, the third cabinet-level nominee this year to have mode use of 

offshore investments and structures, despite the President's unequivocal condemnation of these 

types of activities during the campaign. Moreover, the Cayman Island investment is in a fund 

that, in turn, has invested in companies that outsource jobs, or, using the President's rhetoric, 

ship jobs to low-wage countries like Indio. 
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On top of that, we all remember in early 2009 when President Obama remarked about 

Wall Street, saying that institutions were "teetering on collapse and they are asking for 

taxpayers to help sustain them ... " 

The President also railed against Wall Street bonuses at the time, saying: "That is the 

height of irresponsibility. It is shameful." Elsewhere, he referred to Wall Street bonuses as 

"obscene," 

Like Secretary Lew, Mr. Froman was employed at Citigroup during much of the financial 

crisis. 

In late 2008 and early 2009, American taxpayers provided over $45 billion in direct 

assistance to Citigroup and backed hundreds of billions of Citigroup assets. During those same 

two years, Mr. Froman received mare than $5 million in bonuses, much of which was paid for 

work performed when Citi was on the verge of collapse. 

Once again, we see a contradiction between the President's rhetoric with regard to Wall 

Street and his decision to nominate Mr. Froman to be the U.S. Trade Representative. 

Now, I don't raise these issues to suggest that Mr. Froman has done something wrong or 

that he has not complied with our tax laws. Instead, I simply want to point out what appears to 

be hypocrisy on the part of President Obama and his administration. 

The President's rhetoric seemed to suggest that offshore investments, investments in 

outsourcing, and Wall Street bonuses are not Simply bad policy, but morally wrong. Yet, the 

same vitriol used to attack the President's political opponents does not seem to apply to his 

nominees for cabinet positions. 

As I said during the debate over Secretary Lew's nomination, the American people are 

essentially being told that they should do as the Obama Administration says, not as they do. 

That doesn't inspire a lot of confidence, to say the least. 

That said, I do not believe we should let the administration's contradictory statements 

distract us from trying to help grow our economy through trade. 

Indeed, the U.S. Trade Representative is a vital position. And, despite any disagreements 

I might have with the Obama Administration's rhetoric, I believe this nomination should be 

considered on its own merits. 

Trade is an engine of economic growth. 

Since the end of World War /I, international trade has helped pull millions of people out 

of poverty while creating enormous opportunities for growth here in the United States. 

Today, the United States is the world's largest trading nation, with exports of goods and 

services exceeding $2 trillion a year. 
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The story is no different in my home stote of Utah, where international trade and 

growing exports help us maintain one of the lowest unemployment rates in the nation. 

As we move into the 21st century, the U.s. economy will need to continue to grow and 

create new jobs through trade in order to maintain its position as the most dynamic and 

competitive economy in the world. 

Unfortunately, it appears as though U.S. trade policy has been adrift for much of 

President Obama's first term. 

The long delay in submitting the trade agreements with Colombia, Panama and Korea 

kept U.S. exporters on the sidelines for far too long. And, while new and potentially meaningful 

negotiations have been launched by this administration, not one of them seems close to 

successful conclusion. 

This is due both to a lack of real leadership and the fact that our trade negotiators don't 

have the tools needed to do their job. 

One problem is a simple lack of resources caused, in part, by USTR's decision to create 

the Interagency Trade Enforcement Center, or ITEC, without strong congressional consultation 

or authorization. By doing so, USTR committed a large portion of its funds to infrastructure 

development, with no corresponding budget increase. Coupled with recent acrass- the- board 

budget cuts throughout the federal government, this act placed USTR and its employees under 

severe budget constraints. Congress is working hard to help rectify that situation, urging the 

White House to use its authority to spread the ITEC burden among other involved agencies, but 

to date na action has been taken. 

Furthermore, Trade Promotion Authority expired in 2007. 

As a result, our trade negotiators lack the authority necessary to negotiate and conclude 

new trade agreements. Unfortunately, there has been no real effart by President Obama to 

secure TPA renewal. 

Members of Congress hove fought to fix this problem. We pushed for a vote on TPA 

renewal on the Senate floor twenty-one months ago. Unfortunately, that effort failed, largely 

due to lack of support from our Senate Democratic colleagues. 

To me, this shows that Presidential engagement on TPA renewal is vital. Without the 

President's active leadership and public support for TPA, it is hard to see how our current efforts 

to renew TPA can succeed. 

And we must succeed. 

Today, ninety-five percent of the world's customers live outside the United States. They 

account for 92 percent of global economic growth and 80 percent of the world's purchasing 

power. But the United States is falling behind as we fight for access to these markets. 
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