TABD Mid Year Report
May 10, 1999
Washington, D.C.

Technical Annex

U.S. Government should undertake a further review of Fastener Quality Act so as to ensure that there is no discrimination against imported fasteners which are produced under a quality system acceptable to the exporting authority—deadline: immediate.

 

 

Fasteners

Recommendation:

Through the TABD, the U.S. Commerce Department has supported a delay in the implementation of the 1990 Fastener Quality Act. Unlike most matters brought before the TABD, the issues that gave rise to the Fastener Sector can be resolved only by an act of Congress. Currently, legislation is wending its way through the Congress which mitigates the untoward effects of the Act. If enacted successfully, the focus of the law will be changed and the role of the Department of Commerce will become more focused. However, Congress has also established a deadline of June 24, 1999 in order to forestall the implementation of the original Act. If Congress is unable to act in a timely manner, the Department of Commerce must find a mechanism that delays implementation of the Act until the Act is amended properly.

Action Taken and State of Play:

The Fastener Quality Act of 1990 was enacted to protect consumers from the entry of mismarked high-strength fasteners into commerce. However, the statute was later determined to be too prescriptive and the Department of Commerce’s efforts to implement the Act resulted in burdensome and costly regulations that would impact severely on transatlantic trade. This issue was first brought to the TABD at its annual meeting in Rome; but the Fastener Sector was not formed until its 1998 mid-year meeting, one week following the publication of a final regulation. In the ensuing months, the Congress delayed implementation of the regulation, the Department of Commerce performed a thorough review of past and current conditions that would support the Act and/or include recommendations for change.

In light of this activity, the Fastener Sector, at the TABD CEO Meeting in Charlotte, asked the Department of Commerce to facilitate the input of EU interests into the review; to begin to determine how, if Congress failed to act in a timely fashion, it could delay further the implementation of the Act; and to prepare to do so.

At this point, the effort to amend substantially the Fastener Quality Act is considered very fluid. Legislation has been introduced into both the upper and lower chambers of Congress; hearings have been held; and votes by the full membership of both chambers are expected by the start of the mid-year meeting. Nonetheless, pitfalls exist that could forestall timely passage and signature by the President. Sector managers will also review the legislation for impenetrable barriers to transatlantic trade.

Outlook:

The Fastener Sector is sufficiently assured of success that it does not, at this time, intend to participate in the 1999 TABD CEO Conference. However, enactment of the aforementioned legislation will require the creation of some regulatory mechanisms to implement the law and sector managers will monitor closely their development. Also, the Sector will compare the new U.S. law and regulations with the laws that have already been enacted in France and Italy with an eye toward harmonization. The sector managers may well return to the TABD to ensure harmonization is implemented properly.

 

Heavy Equipment Industries: U.S. Fastener Quality Act:

Recommendations:

Discussions between the U.S. Department of Commerce and the European Commission. The decided FQA has been repealed by President Clinton in August 1998. Investigations on the consequences initiated by NIST. Initiating of new legislation.

Action Taken and State of Play:

Seminar in Chicago after the 1998 Charlotte Conference with participants from U.S. authorities and industry from U.S. and Europe. Agreement between participants that due to new Quality assurance systems used frequently by industry and to other legislation with same impact there was no need for FQA in the old manner. Different industry constellations have contributed to a new proposal where consequences seems to be acceptable to industry and useful in society; sector managers will also review the legislation for impenetrable barriers to transatlantic trade.

Outlook:

The proposed legislation will be implemented and therefore no issue in the TABD process.