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Washington, D.C. – This week, U.S. Senator Bob Casey (D-PA) introduced the Market Economy Sourcing Act, which would ensure future trade agreements prevent free-riding from non-market economies (NMEs), like China. This legislation would establish a supplemental rule of origin–used to determine if products are eligible for duty-free or reduced duties under free trade agreement rules—to limit the content from non-market economies that can be included in FTA qualifying goods. The Market Economy Sourcing Act will establish a limit on the amount of content that can come from non-market economies, shifting dependence away from NMEs, like China. By limiting the ability of non-market economies to free ride on trade agreements, this measure will help ensure FTAs promote market principles and fair competition in the global economy.

“The Market Economy Sourcing Act will ensure the benefits of a trade agreement are conferred on countries which respect market principles,” said Senator Casey. “For too long, non-market economies, like China, have been able to free-ride on our trade agreements. In some instances as much as 70 percent of content can originate from China in goods that enter the United States under an FTA. I will be pushing for its inclusion in the US-UK negotiation and any future trade negotiation.”

“For too long, working people have been hurt by our country’s broken trade system. Sen. Casey’s bill will help provide some much needed relief by ensuring that future trade agreements promote production and jobs in the signing countries rather than allowing countries like China to cheat their way into our markets. This approach is long overdue. China and other non-market countries should never be allowed to contribute significant amounts of their products in anything bearing a ‘Made in the USA’ label,” said Tom Conway, USW International President.

“I commend Senator Casey for introducing The Market Economy Sourcing Act and for his tireless work on behalf of working families throughout his distinguished career. His bill closes a loophole that allows non-market countries who are not parties to a trade agreement to benefit from the agreement’s reduced tariffs and increased market access. Currently, under the United States’ multiple trade agreements, between 25 to 65 percent of a car’s value can be manufactured in China and pay nothing in tariffs – despite China not being part of the agreement. With loopholes like this, it is no mystery why we have lost millions of good manufacturing jobs in recent decades, including 700,000 to China in 2017 and 2018 alone. Our broken trade model must be fixed, and The Market Sourcing Act is a step in the direction,” said UAW Region 9 Director, Jeff Binz.

The Market Economy Sourcing Act is endorsed by United Auto Workers (UAW), United Steel Workers (USW), the International Association of Machinists and Aerospace Workers (IAMAW), the AFL-CIO and the National Council of Textile Organizations (NCTO).

Read the Market Economy Sourcing Act here.

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