The investigation, Advice Concerning the Proposed Expansion of the Information Technology Agreeement: Phase I (Investigation No. 332-390), was requested by the United States Trade Representative (USTR).

The study, to be delivered in two phases, concerns the proposed modification of duties on certain information technology (IT) products which were listed in an attachment to the USTR's letter requesting the investigation. As requested, in the first phase of its report, the ITC provides detailed descriptions of the products on the list; the uses of these products relative to IT industries and consumers, as well as to non-IT industries and consumers; and the major producing countries, U.S. export markets, and sources of U.S. imports. In reviewing the products, the ITC identifies those products that are viewed as import sensitive by U.S. industry or other sources, as well as any similar products that could reasonably be expected to be included in the product groupings but are not.

In the second phase of its report, due to the USTR by May 1, 1998, the ITC will, to the extent possible, analyze briefly current tariff and nontariff trade barriers, if any; patterns of U.S. imports and U.S. exports; and increased opportunities resulting from proposed tariff modifications. The information included in the report on the first phase of the investigation will be incorporated into the second phase report.

The ITA, concluded on July 1, 1997, eliminates tariffs among 43 trading partners on a wide range of IT products including computers, telecommunications equipment, semiconductors, and other electronic products. Early in the ITA process, the participants concurred that the agreement would be subject to review and expansion. At a March 26, 1997, meeting in Geneva, ITA participants agreed that this ongoing work, which is generally referred to as ITA-II, would begin in October 1997, and the results would be implemented beginning January 1, 1999.

On September 3, 1997, the USTR published a notice in the Federal Register requesting comments on priorities for ITA-II, including suggestions for additional products for tariff elimination. In response, the USTR received a considerable number of suggestions for potential products, both finished products and IT inputs, from the U.S. private sector. In addition, the USTR received product suggestions from other ITA signatories. Negotiations on adding products to the ITA will take place this spring, and the USTR has asked the ITC to provide advice regarding a broad list of the proposed products prior to the conclusion of the negotiations. The President is required to obtain advice regarding such proposed actions from the ITC.

Advice Concerning the Proposed Expansion of the Information Technology Agreement: Phase I (USITC publication 3097, March 1998) will be available on the ITC's Internet server at www.usitc.gov. A printed copy may be requested by calling 202-205-1809 or by contacting the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may also be faxed to 202-205-2104.