The Trade Facilitation Agreement (TFA), finalized in December 2013, is the newest international trade agreement to enter into force at the World Trade Organization (WTO), after two-thirds of WTO member countries ratified the multilateral agreement as of February 22, 2017. The TFA is important to Congress because it may affect U.S. trade flows, the U.S. economy, and international capacity building efforts. This report discusses the TFA, its background and current status, potential impact on U.S. trade agreement provisions, plans for implementation, and relevant policy options for Congress to consider. The TFA does not require further congressional approval because U.S. compliance with the agreement's commitments does not require changes to U.S. law. The TFA aims to reduce trade costs by streamlining, modernizing, and speeding up the customs processes for cross border trade. Eliminating or reducing inefficiencies at the border may facilitate trade by lowering costs for importers (and possibly consumers), as well as exporters. By increasing transparency, instilling good governance practices, and simplifying processes at the border, the potential for corruption is also reduced. Furthermore, decreasing trade barriers at the border enables connectivity and may increase a country's foreign direct investment (FDI) inflows. Thus, improving trade flows benefits both exporting and importing countries and can be seen as a shared interest across all WTO members. Improved trade flows require effective implementation of the TFA by all WTO members. While the TFA mandatory provisions are subject to WTO Dispute Settlement for enforcement, the agreement contains the Special and Differential Treatment provisions to provide additional implementation time and technical assistance and capacity building assistance for developing and least-developed countries. The United States is already in compliance with most measures represented in the TFA, and thus does not have to change its current practices to comply with the TFA provisions. The World Trade Organization (WTO) was established on January 1, 1995, following the ratification of the Uruguay Round Agreements and today includes 164 member countries. It succeeded the General Agreement on Tariffs and Trade (GATT), which was created in 1947 as a part of the post-WWII effort to build a stable, open, and predictable international economic framework. The Doha Development Agenda (Doha Round) of multilateral trade negotiations, launched in 2001, was impeded by differences among developed and developing countries on key trade issues in agriculture, goods, and services. The WTO's 2015 Ministerial Declaration acknowledged the division over the future of the Doha Round, and did not reaffirm its continuation. As part of the Doha Round, WTO members launched negotiations on trade facilitation in July 2004. While most other aspects of the Doha Round were suspended, WTO members agreed to conclude the TFA as a stand-alone agreement in December 2013 at the Bali Ministerial Conference. Hence, the TFA became the first new multilateral trade agreement concluded since the establishment of the World Trade Organization in 1995. The TFA builds on earlier related provisions in the GATT and further expedites the movement, release, and clearance of goods, including goods in transit. On November 27, 2014, WTO members agreed to consider the TFA and triggered the process for amending the WTO Agreement. The TFA entered into force on February 22, 2017, when two-thirds of the WTO members had ratified it domestically by depositing an "instrument of acceptance" at the WTO to formally accept the agreement. If three-quarters of the WTO members agree, then any member which has not accepted it within a specified time may elect to withdraw from the WTO or accept the obligations of the Amendment. Congress supported the TFA as part of its U.S. trade negotiating objectives in the 2015 Trade Promotion Authority ( P.L. 114-26 ). Adoption of the TFA did not require further congressional activity because U.S. compliance with the agreement's commitments did not require changes to U.S. law. The United States formally accepted it on January 23, 2015, the third WTO member to do so. The TFA has three sections. The first section is the heart of the agreement, containing the provisions—of which many, but not all, are binding and enforceable. The text further clarifies relevant articles of the GATT and includes provisions for customs cooperation. Mandatory articles include requiring members to publish information, including certain items online; issue advance rulings in a reasonable amount of time; and provide for appeals or reviews, if requested. Some TFA articles encourage, rather than oblige, members to do certain things, including provisions that advise members to provide information without charging fees; to take into consideration voluntary disclosure of breaches as a mitigating factor when assessing penalties; to measure and publish average release time of goods; and to use international standards for developing authorized operator schemes and as the basis for import and export formalities and processes. See Table 1 for a summary of the provisions. The second section provides for special and differential treatment for developing country members and least-developed country (LDC) members, allowing them more time and assistance to implement the agreement. The third section of the agreement contains the institutional arrangements for administering the TFA. For example, it establishes the Committee on Trade Facilitation, which comprises all members. Part of the U.S. International Trade Commission's (ITC's) statutory function is to examine the potential impact of trade deals on the U.S. economy for Congress and the White House. According to the ITC, "the most direct effects [of trade agreements] are the removal of barriers to cross-border trade in goods and services and the facilitation of cross-border investment." To that end, the TFA aims to address multiple trade barriers U.S. exporters confront. These include the lack of transparency on process and documentation requirements for exporting to a given country, which could also create opportunities for corruption. For example, according to an ITC report, "lack of clear information concerning duties and taxes on goods imported into the EU is also problematic for U.S. s mall and medium-sized enterprises ( SMEs)." In business, delays at the border caused by extensive paperwork requirements, inefficient transport or processes, and lack of coordination between various border authorities within or between countries can be costly for U.S. firms. The U.S. Trade Representative (USTR) annual 2016 National Trade Estimate Report describes several trade barriers across the globe that the TFA aims to address. Some examples follow. In Brazil, "specific information related to non-automatic import license requirements and explanations for rejections of non-automatic import license applications are lacking. The lack of transparency surrounding these procedures creates additional burdens for U.S. exporters.... U.S. companies continue to complain of burdensome documentation requirements for the import of certain types of goods that apply even if imports are on a temporary basis." In the European Union (EU), "not only are the Customs Code Committee (CCC) and other EU-level institutions ineffective tools for achieving the uniform administration and application of EU customs law, but the EU also lacks tribunals or procedures for the prompt review and EU-wide correction of administrative actions relating to customs matters.... Thus, obtaining corrections with EU-wide effect for administrative actions relating to customs matters is a cumbersome and frequently time-consuming process." In Indonesia, "customs relies on a schedule of reference prices to assess duties on some imports rather than using actual transactions as required by the WTO Agreement on Customs Valuation. Indonesia's Director General of Customs and Excise makes a valuation assessment based on the perceived risk status of the importer and the average price of a same or similar product imported during the previous 90 days." "Clearing goods through Algerian customs is the single most frequently reported problem facing foreign companies operating in Algeria. Delays can take weeks or months, and in many cases are not accompanied by official explanations." Modernizing customs and border processes can have benefits for both international businesses and exporters as well as domestic customers and government agencies . ( See South Korea case study in Text Box . ) Exporters and shippers can save time and money; importing agencies can become more efficient , thereby sav ing money ( while also collecting fees and taxes faster ) ; and end customers can receive goods faster at lower costs if the seller passes along the related savings. In this way, customs and border reform efforts are of benefit to both importing and exporting countries, improving their terms of trade , transparency, and good governance. U.S. companies, from very small businesses to large multinational firms, face trade barriers that the TFA may alleviate. E-commerce platforms allow SMEs to easily reach a global customer base, but many may be hesitant to serve foreign markets because of the complexity of global shipping and delivery. Compared with larger companies, SMEs have fewer resources to deal with the regulatory hurdles of international shipments , and trade costs represent a larger proportional burden for them . R eforms to reduce these costs could therefore boost SME willingness to participat e in international trade. For example, if each country post s customs information online, SMEs c ould more easily understand export and import processes and requirements. If TFA implementation efforts were to also establish a standardized international format or template for posting required information , it c ould further reduce the burden on buyers and sellers trying to export to multiple countries. Reform efforts also help large multi national firms exporting large volumes or managing complex global va lue chains (GVCs) that rely on predictable, constant flow s of imports and exports . For example, the use of automation and risk management required by the TFA will allow firms to submit information in advance so that an entire shipment is not delayed upon arrival at the border while officials determine what to inspect.