The Export Trading Company Act:

Abstract

The Export Trading Company Act (ETCA) was signed into law in 1982 by then President Ronald Reagan. The goal of this legislation was to promote U.S. exports by allowing U.S. banks to hold an equity U.S. exports by allowing U.S. banks to hold an equity position in Export Trading Companies (ETCs) and by exempting the overseas activities of these organiziations from U.S. antitrust laws. The writers of this legislation hoped that the American ETCs would eventually grow to rival the Japanese General Export Trading Cmopanies known as sogo shosha's. This paper focuses on the history of the ETCA, its problems, and the current state of Export Trading Companies (ETCs) in the U.S. When the ETCA was established, the dollar was on an upward trend and was relatively high compared to other major currencies, such as the Deutsche mark, Japanese yen, and pound sterling. The legislation had a somewhat minor effect of exports, as few companies came together to form ETCs. With the fall of the dollar, an important question to a...