[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3216 Enrolled Bill (ENR)]

        H.R.3216
                       One Hundred Third Congress

                                 of the

                        United States of America


                          AT THE FIRST SESSION

          Begun and held at the City of Washington on Tuesday,
  the fifth day of January, one thousand nine hundred and ninety-three


                                 An Act

  
 
  To amend the Comprehensive Drug Abuse Prevention and Control Act of 
1970 to control the diversion of certain chemicals used in the illicit 
production of controlled substances such as methcathinone and 
methamphetamine, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Domestic Chemical Diversion Control 
Act of 1993''.

SEC. 2. DEFINITION AMENDMENTS.

    (a) Definitions.--Section 102 of the Controlled Substances Act (21 
U.S.C. 802) is amended--
        (1) in paragraph (33), by striking ``any listed precursor 
    chemical or listed essential chemical'' and inserting ``any list I 
    chemical or any list II chemical'';
        (2) in paragraph (34)--
            (A) by striking ``listed precursor chemical'' and inserting 
        ``list I chemical''; and
            (B) by striking ``critical to the creation'' and inserting 
        ``important to the manufacture'';
        (3) in paragraph (34) (A), (F), and (H), by inserting ``, its 
    esters,'' before ``and'';
        (4) in paragraph (35)--
            (A) by striking ``listed essential chemical'' and inserting 
        ``list II chemical'';
            (B) by inserting ``(other than a list I chemical)'' before 
        ``specified''; and
            (C) by striking ``as a solvent, reagent, or catalyst''; and
        (5) in paragraph (38), by inserting ``or who acts as a broker or 
    trader for an international transaction involving a listed chemical, 
    a tableting machine, or an encapsulating machine'' before the 
    period;
        (6) in paragraph (39)(A)--
            (A) by striking ``importation or exportation of'' and 
        inserting ``importation, or exportation of, or an international 
        transaction involving shipment of,'';
            (B) in clause (iii) by inserting ``or any category of 
        transaction for a specific listed chemical or chemicals'' after 
        ``transaction'';
            (C) by amending clause (iv) to read as follows:
            ``(iv) any transaction in a listed chemical that is 
        contained in a drug that may be marketed or distributed lawfully 
        in the United States under the Federal Food, Drug, and Cosmetic 
        Act (21 U.S.C. 301 et seq.) unless--
                ``(I)(aa) the drug contains ephedrine or its salts, 
            optical isomers, or salts of optical isomers as the only 
            active medicinal ingredient or contains ephedrine or its 
            salts, optical isomers, or salts of optical isomers and 
            therapeutically insignificant quantities of another active 
            medicinal ingredient; or
                ``(bb) the Attorney General has determined under section 
            204 that the drug or group of drugs is being diverted to 
            obtain the listed chemical for use in the illicit production 
            of a controlled substance; and
                ``(II) the quantity of ephedrine or other listed 
            chemical contained in the drug included in the transaction 
            or multiple transactions equals or exceeds the threshold 
            established for that chemical by the Attorney General.''; 
            and
            (D) in clause (v), by striking the semicolon and inserting 
        ``which the Attorney General has by regulation designated as 
        exempt from the application of this title and title III based on 
        a finding that the mixture is formulated in such a way that it 
        cannot be easily used in the illicit production of a controlled 
        substance and that the listed chemical or chemicals contained in 
        the mixture cannot be readily recovered;'';
        (7) in paragraph (40), by striking ``listed precursor chemical 
    or a listed essential chemical'' each place it appears and inserting 
    ``list I chemical or a list II chemical''; and
        (8) by adding at the end the following new paragraphs:
    ``(42) The term `international transaction' means a transaction 
involving the shipment of a listed chemical across an international 
border (other than a United States border) in which a broker or trader 
located in the United States participates.
    ``(43) The terms `broker' and `trader' mean a person that assists in 
arranging an international transaction in a listed chemical by--
        ``(A) negotiating contracts;
        ``(B) serving as an agent or intermediary; or
        ``(C) bringing together a buyer and seller, a buyer and 
    transporter, or a seller and transporter.''.
    (b) Removal of Exemption of Certain Drugs.--
        (1) Procedure.--Part B of the Controlled Substances Act (21 
    U.S.C. 811 et seq.) is amended by adding at the end the following 
    new section:


                  ``removal of exemption of certain drugs

    ``Sec. 204. (a) Removal of Exemption.--The Attorney General shall by 
regulation remove from exemption under section 102(39)(A)(iv) a drug or 
group of drugs that the Attorney General finds is being diverted to 
obtain a listed chemical for use in the illicit production of a 
controlled substance.
    ``(b) Factors To Be Considered.--In removing a drug or group of 
drugs from exemption under subsection (a), the Attorney General shall 
consider, with respect to a drug or group of drugs that is proposed to 
be removed from exemption--
        ``(1) the scope, duration, and significance of the diversion;
        ``(2) whether the drug or group of drugs is formulated in such a 
    way that it cannot be easily used in the illicit production of a 
    controlled substance; and
        ``(3) whether the listed chemical can be readily recovered from 
    the drug or group of drugs.
    ``(c) Specificity of Designation.--The Attorney General shall limit 
the designation of a drug or a group of drugs removed from exemption 
under subsection (a) to the most particularly identifiable type of drug 
or group of drugs for which evidence of diversion exists unless there is 
evidence, based on the pattern of diversion and other relevant factors, 
that the diversion will not be limited to that particular drug or group 
of drugs.
    ``(d) Reinstatement of Exemption With Respect to Particular Drug 
Products.--
        ``(1) Reinstatement.--On application by a manufacturer of a 
    particular drug product that has been removed from exemption under 
    subsection (a), the Attorney General shall by regulation reinstate 
    the exemption with respect to that particular drug product if the 
    Attorney General determines that the particular drug product is 
    manufactured and distributed in a manner that prevents diversion.
        ``(2) Factors to be considered.--In deciding whether to 
    reinstate the exemption with respect to a particular drug product 
    under paragraph (1), the Attorney General shall consider--
            ``(A) the package sizes and manner of packaging of the drug 
        product;
            ``(B) the manner of distribution and advertising of the drug 
        product;
            ``(C) evidence of diversion of the drug product;
            ``(D) any actions taken by the manufacturer to prevent 
        diversion of the drug product; and
            ``(E) such other factors as are relevant to and consistent 
        with the public health and safety, including the factors 
        described in subsection (b) as applied to the drug product.
        ``(3) Status pending application for reinstatement.--A 
    transaction involving a particular drug product that is the subject 
    of a bona fide pending application for reinstatement of exemption 
    filed with the Attorney General not later than 60 days after a 
    regulation removing the exemption is issued pursuant to subsection 
    (a) shall not be considered to be a regulated transaction if the 
    transaction occurs during the pendency of the application and, if 
    the Attorney General denies the application, during the period of 60 
    days following the date on which the Attorney General denies the 
    application, unless--
            ``(A) the Attorney General has evidence that, applying the 
        factors described in subsection (b) to the drug product, the 
        drug product is being diverted; and
            ``(B) the Attorney General so notifies the applicant.
        ``(4) Amendment and modification.--A regulation reinstating an 
    exemption under paragraph (1) may be modified or revoked with 
    respect to a particular drug product upon a finding that--
            ``(A) applying the factors described in subsection (b) to 
        the drug product, the drug product is being diverted; or
            ``(B) there is a significant change in the data that led to 
        the issuance of the regulation.''.
        (2) Clerical amendment.--The table of contents of the 
    Comprehensive Drug Abuse Prevention and Control Act of 1970 (84 
    Stat. 1236) is amended by adding at the end of that portion relating 
    to part B of title II the following new item:
``Sec. 204. Removal of exemption of certain drugs.''.

    (c) Regulation of Listed Chemicals.--Section 310 of the Controlled 
Substances Act (21 U.S.C. 830) is amended--
        (1) in subsection (a)(1)--
            (A) by striking ``precursor chemical'' and inserting ``list 
        I chemical''; and
            (B) in subparagraph (B), by striking ``an essential 
        chemical'' and inserting ``a list II chemical''; and
        (2) in subsection (c)(2)(D), by striking ``precursor chemical'' 
    and inserting ``chemical control''.

SEC. 3. REGISTRATION REQUIREMENTS.

    (a) Rules and Regulations.--Section 301 of the Controlled Substances 
Act (21 U.S.C. 821) is amended by striking the period and inserting 
``and to the registration and control of regulated persons and of 
regulated transactions.''.
    (b) Persons Required To Register Under Section 302.--Section 302 of 
the Controlled Substances Act (21 U.S.C. 822) is amended--
        (1) in subsection (a)(1), by inserting ``or list I chemical'' 
    after ``controlled substance'' each place it appears;
        (2) in subsection (b)--
            (A) by inserting ``or list I chemicals'' after ``controlled 
        substances''; and
            (B) by inserting ``or chemicals'' after ``such substances'';
        (3) in subsection (c), by inserting ``or list I chemical'' after 
    ``controlled substance'' each place it appears; and
        (4) in subsection (e), by inserting ``or list I chemicals'' 
    after ``controlled substances''.
    (c) Registration Requirements Under Section 303.--Section 303 of the 
Controlled Substances Act (21 U.S.C. 823) is amended by adding at the 
end the following new subsection:
    ``(h) The Attorney General shall register an applicant to distribute 
a list I chemical unless the Attorney General determines that 
registration of the applicant is inconsistent with the public interest. 
Registration under this subsection shall not be required for the 
distribution of a drug product that is exempted under section 
102(39)(A)(iv). In determining the public interest for the purposes of 
this subsection, the Attorney General shall consider--
        ``(1) maintenance by the applicant of effective controls against 
    diversion of listed chemicals into other than legitimate channels;
        ``(2) compliance by the applicant with applicable Federal, 
    State, and local law;
        ``(3) any prior conviction record of the applicant under Federal 
    or State laws relating to controlled substances or to chemicals 
    controlled under Federal or State law;
        ``(4) any past experience of the applicant in the manufacture 
    and distribution of chemicals; and
        ``(5) such other factors as are relevant to and consistent with 
    the public health and safety.''.
    (d) Denial, Revocation, or Suspension of Registration.--Section 304 
of the Controlled Substances Act (21 U.S.C. 824) is amended--
        (1) in subsection (a)--
            (A) by inserting ``or a list I chemical'' after ``controlled 
        substance'' each place it appears; and
            (B) by inserting ``or list I chemicals'' after ``controlled 
        substances'';
        (2) in subsection (b), by inserting ``or list I chemical'' after 
    ``controlled substance'';
        (3) in subsection (f), by inserting ``or list I chemicals'' 
    after ``controlled substances'' each place it appears; and
        (4) in subsection (g)--
            (A) by inserting ``or list I chemicals'' after ``controlled 
        substances'' each place it appears; and
            (B) by inserting ``or list I chemical'' after ``controlled 
        substance'' each place it appears.
    (e) Persons Required To Register Under Section 1007.--Section 1007 
of the Controlled Substances Import and Export Act (21 U.S.C. 957) is 
amended--
        (1) in subsection (a)--
            (A) in paragraph (1), by inserting ``or list I chemical'' 
        after ``controlled substance''; and
            (B) in paragraph (2), by striking ``in schedule I, II, III, 
        IV, or V,'' and inserting ``or list I chemical,''; and
        (2) in subsection (b)--
            (A) in paragraph (1), by inserting ``or list I chemical'' 
        after ``controlled substance'' each place it appears; and
            (B) in paragraph (2), by inserting ``or list I chemicals'' 
        after ``controlled substances''.
    (f) Registration Requirements Under Section 1008.--Section 1008 of 
the Controlled Substances Import and Export Act (21 U.S.C. 958) is 
amended--
        (1) in subsection (c)--
            (A) by inserting ``(1)'' after ``(c)''; and
            (B) by adding at the end the following new paragraph:
    ``(2)(A) The Attorney General shall register an applicant to import 
or export a list I chemical unless the Attorney General determines that 
registration of the applicant is inconsistent with the public interest. 
Registration under this subsection shall not be required for the import 
or export of a drug product that is exempted under section 
102(39)(A)(iv).
    ``(B) In determining the public interest for the purposes of 
subparagraph (A), the Attorney General shall consider the factors 
specified in section 303(h).'';
        (2) in subsection (d)--
            (A) in paragraph (3), by inserting ``or list I chemical or 
        chemicals,'' after ``substances,''; and
            (B) in paragraph (6), by inserting ``or list I chemicals'' 
        after ``controlled substances'' each place it appears;
        (3) in subsection (e), by striking ``and 307'' and inserting 
    ``307, and 310''; and
        (4) in subsections (f), (g), and (h), by inserting ``or list I 
    chemicals'' after ``controlled substances'' each place it appears.
    (g) Prohibited Acts C.--Section 403(a) of the Controlled Substances 
Act (21 U.S.C. 843(a)) is amended--
        (1) by amending paragraphs (6) and (7) to read as follows:
        ``(6) to possess any three-neck round-bottom flask, tableting 
    machine, encapsulating machine, or gelatin capsule, or any 
    equipment, chemical, product, or material which may be used to 
    manufacture a controlled substance or listed chemical, knowing, 
    intending, or having reasonable cause to believe, that it will be 
    used to manufacture a controlled substance or listed chemical in 
    violation of this title or title III;
        ``(7) to manufacture, distribute, export, or import any three-
    neck round-bottom flask, tableting machine, encapsulating machine, 
    or gelatin capsule, or any equipment, chemical, product, or material 
    which may be used to manufacture a controlled substance or listed 
    chemical, knowing, intending, or having reasonable cause to believe, 
    that it will be used to manufacture a controlled substance or listed 
    chemical in violation of this title or title III or, in the case of 
    an exportation, in violation of this title or title III or of the 
    laws of the country to which it is exported;'';
        (2) by striking the period at the end of paragraph (8) and 
    inserting ``; or''; and
        (3) by adding at the end the following new paragraph:
        ``(9) to distribute, import, or export a list I chemical without 
    the registration required by this title or title III.''.

SEC. 4. REPORTS BY BROKERS AND TRADERS; CRIMINAL PENALTIES.

    (a) Notification, Suspension of Shipment, and Penalties With Respect 
to Importation and Exportation of Listed Chemicals.--Section 1018 of the 
Controlled Substances Import and Export Act (21 U.S.C. 971) is amended 
by adding at the end the following new subsection:
    ``(d) A person located in the United States who is a broker or 
trader for an international transaction in a listed chemical that is a 
regulated transaction solely because of that person's involvement as a 
broker or trader shall, with respect to that transaction, be subject to 
all of the notification, reporting, recordkeeping, and other 
requirements placed upon exporters of listed chemicals by this title and 
title II.''.
    (b) Prohibited Acts A.--Section 1010(d) of the Controlled Substances 
Import and Export Act (21 U.S.C. 960(d)) is amended to read as follows:
    ``(d) A person who knowingly or intentionally--
        ``(1) imports or exports a listed chemical with intent to 
    manufacture a controlled substance in violation of this title or 
    title II;
        ``(2) exports a listed chemical in violation of the laws of the 
    country to which the chemical is exported or serves as a broker or 
    trader for an international transaction involving a listed chemical, 
    if the transaction is in violation of the laws of the country to 
    which the chemical is exported;
        ``(3) imports or exports a listed chemical knowing, or having 
    reasonable cause to believe, that the chemical will be used to 
    manufacture a controlled substance in violation of this title or 
    title II; or
        ``(4) exports a listed chemical, or serves as a broker or trader 
    for an international transaction involving a listed chemical, 
    knowing, or having reasonable cause to believe, that the chemical 
    will be used to manufacture a controlled substance in violation of 
    the laws of the country to which the chemical is exported,
shall be fined in accordance with title 18, imprisoned not more than 10 
years, or both.''.

SEC. 5. EXEMPTION AUTHORITY; ANTISMUGGLING PROVISION.

    (a) Notification Requirement.--Section 1018 of the Controlled 
Substances Import and Export Act (21 U.S.C. 971), as amended by section 
1505(a) of this Act, is amended by adding at the end the following new 
subsection:
    ``(e)(1) The Attorney General may by regulation require that the 15-
day notification requirement of subsection (a) apply to all exports of a 
listed chemical to a specified country, regardless of the status of 
certain customers in such country as regular customers, if the Attorney 
General finds that such notification is necessary to support effective 
chemical diversion control programs or is required by treaty or other 
international agreement to which the United States is a party.
    ``(2) The Attorney General may by regulation waive the 15-day 
notification requirement for exports of a listed chemical to a specified 
country if the Attorney General determines that such notification is not 
required for effective chemical diversion control. If the notification 
requirement is waived, exporters of the listed chemical shall be 
required to submit to the Attorney General reports of individual 
exportations or periodic reports of such exportation of the listed 
chemical, at such time or times and containing such information as the 
Attorney General shall establish by regulation.
    ``(3) The Attorney General may by regulation waive the 15-day 
notification requirement for the importation of a listed chemical if the 
Attorney General determines that such notification is not necessary for 
effective chemical diversion control. If the notification requirement is 
waived, importers of the listed chemical shall be required to submit to 
the Attorney General reports of individual importations or periodic 
reports of the importation of the listed chemical, at such time or times 
and containing such information as the Attorney General shall establish 
by regulation.''.
    (b) Prohibited Acts A.--Section 1010(d) of the Controlled Substances 
Import and Export Act (21 U.S.C. 960(d)), as amended by section 4(b) of 
this Act, is amended--
        (1) by striking ``or'' at the end of paragraph (3);
        (2) by striking the comma at the end of paragraph (4) and 
    inserting a semicolon; and
        (3) by adding at the end the following new paragraphs:
        ``(5) imports or exports a listed chemical, with the intent to 
    evade the reporting or recordkeeping requirements of section 1018 
    applicable to such importation or exportation by falsely 
    representing to the Attorney General that the importation or 
    exportation qualifies for a waiver of the 15-day notification 
    requirement granted pursuant to section 1018(e) (2) or (3) by 
    misrepresenting the actual country of final destination of the 
    listed chemical or the actual listed chemical being imported or 
    exported; or
        ``(6) imports or exports a listed chemical in violation of 
    section 1007 or 1018,''.

SEC. 6. ADMINISTRATIVE INSPECTIONS AND AUTHORITY.

    Section 510 of the Controlled Substances Act (21 U.S.C. 880) is 
amended--
        (1) by amending subsection (a)(2) to read as follows:
        ``(2) places, including factories, warehouses, and other 
    establishments, and conveyances, where persons registered under 
    section 303 (or exempt from registration under section 302(d) or by 
    regulation of the Attorney General) or regulated persons may 
    lawfully hold, manufacture, distribute, dispense, administer, or 
    otherwise dispose of controlled substances or listed chemicals or 
    where records relating to those activities are maintained.''; and
        (2) in subsection (b)(3)--
            (A) in subparagraph (B), by inserting ``, listed 
        chemicals,'' after ``unfinished drugs''; and
            (B) in subparagraph (C), by inserting ``or listed chemical'' 
        after ``controlled substance'' and inserting ``or chemical'' 
        after ``such substance''.

SEC. 7. THRESHOLD AMOUNTS.

    Section 102(39)(A) of the Controlled Substances Act (21 U.S.C. 
802(39)(A)), as amended by section 2, is amended by inserting ``a listed 
chemical, or if the Attorney General establishes a threshold amount for 
a specific listed chemical,'' before ``a threshold amount, including a 
cumulative threshold amount for multiple transactions''.

SEC. 8. AMENDMENTS TO LIST I.

    Section 102(34) of the Controlled Substances Act (21 U.S.C. 802(34)) 
is amended--
        (1) by striking subparagraphs (O), (U), and (W);
        (2) by redesignating subparagraphs (P) through (T) as (O) 
    through (S), subparagraph (V) as (T), and subparagraphs (X) and (Y) 
    as (U) and (X), respectively;
        (3) in subparagraph (X), as redesignated by paragraph (2), by 
    striking ``(X)'' and inserting ``(U)''; and
        (4) by inserting after subparagraph (U), as redesignated by 
    paragraph (2), the following new subparagraphs:
            ``(V) benzaldehyde.
            ``(W) nitroethane.''.
SEC. 9. ELIMINATION OF REGULAR SUPPLIER STATUS AND CREATION OF REGULAR 
IMPORTER STATUS.
    (a) Definition.--Section 102(37) of the Controlled Substances Act 
(21 U.S.C. 802(37)) is amended to read as follows:
    ``(37) The term `regular importer' means, with respect to a listed 
chemical, a person that has an established record as an importer of that 
listed chemical that is reported to the Attorney General.''.
    (b) Notification.--Section 1018 of the Controlled Substances Act (21 
U.S.C. 971) is amended--
        (1) in subsection (b)--
            (A) in paragraph (1) by striking ``regular supplier of the 
        regulated person'' and inserting ``to an importation by a 
        regular importer''; and
            (B) in paragraph (2)--
                (i) by striking ``a customer or supplier of a regulated 
            person'' and inserting ``a customer of a regulated person or 
            to an importer''; and
                (ii) by striking ``regular supplier'' and inserting 
            ``the importer as a regular importer''; and
        (2) in subsection (c)(1) by striking ``regular supplier'' and 
    inserting ``regular importer''.

SEC. 10. REPORTING OF LISTED CHEMICAL MANUFACTURING.

    Section 310(b) of the Controlled Substances Act (21 U.S.C. 830(b)) 
is amended--
        (1) by inserting ``(1)'' after ``(b)'';
        (2) by redesignating paragraphs (1), (2), (3), and (4) as 
    subparagraphs (A), (B), (C), and (D), respectively;
        (3) by striking ``paragraph (1)'' each place it appears and 
    inserting ``subparagraph (A)'';
        (4) by striking ``paragraph (2)'' and inserting ``subparagraph 
    (B)'';
        (5) by striking ``paragraph (3)'' and inserting ``subparagraph 
    (C)''; and
        (6) by adding at the end the following new paragraph:
    ``(2) A regulated person that manufactures a listed chemical shall 
report annually to the Attorney General, in such form and manner and 
containing such specific data as the Attorney General shall prescribe by 
regulation, information concerning listed chemicals manufactured by the 
person. The requirement of the preceding sentence shall not apply to the 
manufacture of a drug product that is exempted under section 
102(39)(A)(iv).''.

SEC. 11. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall take effect on 
the date that is 120 days after the date of enactment of this Act.







                                Speaker of the House of Representatives.







                             Vice President of the United States and    
                                                President of the Senate.