On October 16, 2018, the Office of the United States Trade Representative (“USTR”) notified Congress that it plans to open individual trade negotiations with Japan, the United Kingdom (“UK”), and the European Union (“EU”).

The notifications are the first step in the negotiation process required by the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (this process is known as Fast Track Authority). The notifications begin a 90-day period during which the Administration must consult with Congress and solicit public input on the proposed agreements. After the end of the 90-day period, which closes on January 14, 2019, the Administration will be able to initiate negotiations with Japan, the UK and the EU.

In the notifications, USTR emphasized that the new negotiations are intended to “address both tariff and non-tariff barriers” and “achieve free, fair, and reciprocal trade” with Japan, the UK and the EU. Each negotiation will carries with its own unique concerns, however:

• The United Kingdom: The UK cannot officially negotiate any trade agreements with other countries until it leaves the EU, which is now scheduled to occur on March 29, 2019. The UK’s exit from the EU could be delayed, however, if the EU and the UK negotiate an ‘exit’ agreement that requires the UK to adhere to EU customs union rules during the transition period for the exit process. As a result, USTR will only be able to begin negotiations with the UK once the country formally departs from the EU.

• The European Union: The EU must address certain basic issues before it will be able to negotiate with the United States. Most importantly, the European Commission must secure a negotiating mandate from its member states. There is, however, currently no indication when, or even whether, the European Commission will be able to do so. Moreover, President Emmanuel Macron has stated that France will not enter into commercial agreements with countries that do not respect the Paris Climate Accord. (President Trump announced his intention to withdraw from the Paris Climate Accord in 2017, and the withdrawal may become final on November 4, 2020. ) Finally, there appears to be a disagreement between the United States and the EU on whether agricultural issues will be a subject of negotiations. The EU says that the topic is off the table while the United States insists that agricultural issues will be part of any final agreement.

• Japan: In its notification letter for Japan, USTR stated that it intended to address in the agreement issues relating to the United States’ exports to Japan of automobiles, services, and agriculture which have been impacted by multiple tariff and non-tariff barriers. USTR acknowledged, however, that negotiations with Japan may need to occur in stages, given that Japan’s current position is that the United States should re-engage in the Trans-Pacific Partnership, the regional trade agreement that President Trump withdrew from early in his presidency.

In addition to consulting with Congress and soliciting public input during the initial 90 day window, USTR must publish its objectives for each negotiation 30 days prior to the start of negotiations. Thus, if USTR intends to initiate negotiations the EU and Japan as soon as the 90-day window expired, it would need to publish negotiating objectives by December 15, 2018.

The announcement by the Administration was met with guarded optimism. Rep. Kevin Brady (R-TX), the chairman of the House Ways and Means Committee, said, “These three economies are some of our largest and most important trading partners, but they are also markets in which U.S. farmers, manufacturers, and service providers face significant barriers.” Similarly, Senator Ron Wyden (D-OR), the ranking minority member on the Senate Finance Committee, which oversees trade issues, said, “The administration must take the time to tackle trade barriers comprehensively.”

The U.S. Chamber of Commerce stated that it was “pleased” with the announcement, noting that it “will work with the administration and Congress throughout the negotiations to ensure forthcoming discussions result in free and fair trade as well as adhere to the important objectives” of the statute.