The Generalized System of Preferences (GSP) provides nonreciprocal, duty-free tariff treatment to certain products imported into the United States from designated beneficiary developing countries (BDCs). The United States, the European Union (EU), and other developed countries have implemented similar programs since the 1970s in order to promote economic growth in developing nations. Currently, 121 developing countries and territories are GSP beneficiary developing countries (BDCs). The GSP program provides duty-free entry into the United States for over 3,500 products (based on 8-digit U.S. Harmonized Tariff Schedule tariff lines) from BDCs, and duty-free status to an additional 1,500 products from 44 GSP beneficiaries additionally designated as least-developed beneficiary developing countries (LDBDCs). In 2017, products valued at about $21.2 billion (imports for consumption) entered the United States duty-free under the program, out of total imports from GSP countries of about $220 billion. Total U.S. imports from all countries amounted to about $2.3 trillion in 2017. This report briefly summarizes recent GSP developments. It provides a brief history, economic rationale, legal background, and comparison of preferential trade programs worldwide and describes the U.S. implementation of the GSP program. On March 23, 2018, President Trump signed the Consolidated Appropriations Act, 2018 ( P.L. 115-141 ). Division M, Title V of the Act extended the GSP program until December 31, 2020. The program was also retroactively renewed for all GSP-eligible entries between December 31, 2017 (the previous expiration date), and April 22, 2018, the effective date of the current GSP renewal reauthorization. The GSP reauthorization also made certain technical modifications to competitive need limits and waivers, and required the U.S. Trade Representative (USTR) to submit an annual report to Congress on efforts to ensure that GSP countries are meeting the eligibility criteria for the program. U.S. Customs and Border Protection (CBP) will issue automatic refunds of duties paid during the GSP program lapse if (1) importer of record (IOR) information is current, (2) entries continued be flagged as GSP-eligible imports (with the special program indicator (SPI) "A,") during the program lapse, and (3) the importer is a member of CBP's Automated Clearinghouse (ACH) program. If the importer did not fulfill these criteria, a refund request may be submitted in a letter, as a post-summary correction (PSC), or as a protest. The request must include all importer of record (IOR) information; the import entry number, line number, and U.S. Harmonized Tariff Schedule (HTSUS) number; the amount of the estimated total refund; and a signed statement that the goods are eligible for GSP. In Proclamation 9687 of December 22, 2017, President Trump reinstated Argentina's GSP eligibility. In the same proclamation, the President suspended Ukraine's GSP eligibility with respect to certain tariff lines because the country did not provide adequate protection of intellectual property rights (IPR). According to the GSP statute, the President is authorized to designate additional products as duty-free under GSP, following a product review and analysis by the U.S. International Trade Commission (ITC). The ITC's role is primarily to determine if the products would be import-sensitive if imported duty-free from GSP beneficiaries. Congress, from time to time, provides the President with additional authority to declare duty-free access for particular goods. Section 202 of P.L. 114-27 gave the President the authority to amend the list of GSP-eligible products by designating certain cotton and cotton waste products as duty-free for eligible least-developed beneficiaries (see Table 1 ). According to the Senate report accompanying H.R. 1295 , the provision was included to implement the U.S. commitments to the WTO to provide duty-free, quota-free treatment for certain cotton products originating from least-developed countries. President Obama implemented authority on June 30, 2016. Section 204 of P.L. 114-27 also granted similar presidential authority to designate certain luggage and travel articles as eligible for GSP (See Table 2 ). After completion of the ITC analysis, the Obama Administration declared these goods eligible for duty-free treatment for GSP least-developed and African Growth and Opportunity Act (AGOA) beneficiaries only. The American Apparel and Footwear Association (AAFA) and other associations in the travel goods industry, as well as several Members of Congress, reportedly asserted that travel goods should be eligible for duty-free treatment for all GSP beneficiaries. In a March 20, 2017, letter to President Trump, the AAFA requested that he provide GSP access accordingly. In Presidential Proclamation 9625, President Trump provided duty-free access for 23 luggage and travel goods specified in the law to all GSP beneficiaries. The basic principle behind GSP trade programs worldwide is to provide developing countries with unilateral preferential market access to developed-country markets in order to spur economic growth in poorer countries. The preferential access is in the form of lower tariff rates (or as in the U.S. case, duty-free status) for certain products that are determined not to be "import sensitive" in the receiving country market. The program concept was first adopted internationally in 1968 by the United Nations Conference on Trade and Development (UNCTAD) at the UNCTAD II Conference. The GSP concept and programs were established based on the premise that preferential tariff rates in developed country markets could promote export-driven industry growth in developing countries. It was believed that this, in turn, would help to free beneficiaries from heavy dependence on trade in primary products (e.g., raw materials), and help diversify their economies to promote stable growth. Some economists claim that GSP was established, in part, as a means of reconciling two widely divergent economic perspectives of trade equity that arose during early negotiations on the General Agreement on Tariffs and Trade (GATT). Industrialized, developed nations argued that the most-favored-nation (MFN) principle should be the fundamental and universal principle governing multilateral trade, while less-developed countries believed that equal treatment of economically unequal trading partners did not constitute equity in trade benefits. These countries called for "special and differential treatment" for developing countries. Economists assert that GSP schemes thus became one of the means of offering a form of special treatment that developing nations sought, while allaying the fears of developed countries that tariff "disarmament" might create serious disruptions among import-sensitive industries in their domestic markets. Due to differences in developed countries' economic structures and tariff programs—as well as differences in the types of domestic industries and products each country wanted to shield from greater foreign competition—it proved difficult to create one unified system of tariff concessions on additional products. Therefore, the GSP concept became a system of individual national schemes based on common goals and principles—each with a view toward providing developing countries with generally equivalent opportunities for export growth. As a result, the preference-granting countries implemented various individual schemes of temporary, generalized, non reciprocal preferences under which tariffs were lowered or eliminated on some imports from certain developing countries. Although not specifically allowed or codified in the GATT, the programs of most GSP-granting countries place certain conditions on the nonreciprocal preferences by (1) excluding certain countries; (2) determining specific product coverage; (3) determining rules of origin governing the preference; (4) determining the duration of the scheme; (5) reducing preferential margins accruing to developing countries by continuing to lower or remove tariffs as a result of multilateral, bilateral, and regional negotiations; (6) preventing the concentration of benefits among a few countries; (7) including safeguard mechanisms or "escape" clauses to protect import-sensitive industries; and (8) placing caps on the volume of duty-free trade entering under their programs. By its very nature as a trade preference, the GSP concept posed a problem under the GATT, because granting preferences to particular countries is inconsistent with the fundamental nondiscrimination obligation placed on GATT Parties (GATT Article I:1) to grant MFN tariff treatment to the products of all other GATT Parties. However, since preference programs were viewed as a means of transitioning developing countries to greater trade liberalization and economic development, GATT Parties accommodated them in a series of joint actions. First, in 1965, the GATT Parties added Part IV to the General Agreement, an amendment that recognizes the special economic needs of developing countries and asserts the principle of non-reciprocity. Under this principle, developed countries may forego the receipt of reciprocal benefits for their negotiated commitments to reduce or eliminate tariffs and restrictions on the trade of less developed contracting parties. Second, because of the underlying MFN issue, GATT Parties in 1971 adopted a waiver of Article I for GSP programs to allow developed contracting parties to accord more favorable tariff treatment to the products of developing countries for 10 years. The GSP was described in the decision as a "system of generalized, non-reciprocal and non-discriminatory preferences beneficial to the developing countries." At the end of the Tokyo Round of Multilateral Trade Negotiations in 1979, developing countries secured adoption of the so-called Enabling Clause, a permanent deviation from MFN by joint decision of the GATT Contracting Parties.