[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3565 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 3565

   To provide regulatory incentives to promote national treatment by 
 foreign countries to United States providers of certain financial and 
            communications services, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 19, 1993

  Mr. Markey introduced the following bill; which was referred to the 
                    Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
   To provide regulatory incentives to promote national treatment by 
 foreign countries to United States providers of certain financial and 
            communications services, 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 ``Fair Trade in Services Act of 
1993''.

                      TITLE I--FINANCIAL SERVICES

SEC. 101. EFFECTUATING THE PRINCIPLE OF NATIONAL TREATMENT FOR 
              SECURITIES BROKERS AND DEALERS.

    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by adding at the end the following new section:

                          ``national treatment

    ``Sec. 36. (a) Purpose.--This section is intended to encourage 
foreign countries to accord national treatment to United States brokers 
and dealers that operate or seek to operate in those countries, and 
thereby end discrimination against United States brokers and dealers.
    ``(b) Reports Required.--The Secretary of the Treasury shall, not 
later than December 1, 1994, and biennially thereafter, submit to the 
Congress a report--
            ``(1) identifying any foreign country--
                    ``(A) that does not accord national treatment to 
                United States brokers and dealers; and
                    ``(B) with respect to which no notice under 
                subsection (e)(1) is in effect;
            ``(2) explaining why the Secretary has not published, or 
        has rescinded, such a notice with respect to that country; and
            ``(3) describing the results of any negotiations conducted 
        pursuant to subsection (d)(1) with respect to that country.
    ``(c) Discretionary Determinations.--The Secretary may, at any 
time, publish in the Federal Register a determination that a foreign 
country does not accord national treatment to United States brokers or 
dealers.
    ``(d) Negotiations Required.--
            ``(1) In general.--The Secretary of the Treasury shall 
        initiate negotiations with any foreign country in which, 
        according to the report under subsection (b) or any 
        determination under subsection (c), there is a significant 
        failure to accord national treatment to United States brokers 
        or dealers, to ensure that such country accords national 
        treatment to United States brokers and dealers.
            ``(2) Negotiations not required.--Paragraph (1) does not 
        require the Secretary of the Treasury to initiate negotiations 
        with a foreign country if the Secretary--
                    ``(A) determines that such negotiations would be 
                fruitless or would impair national economic interests; 
                and
                    ``(B) gives written notice of that determination to 
                the chairman and ranking minority member of the 
                Committee on Banking, Housing, and Urban Affairs of the 
                Senate and of the Committee on Energy and Commerce of 
                the House of Representatives.
    ``(e) Sanctions.--
            ``(1) Secretary's notice.--If negotiation pursuant to 
        subsection (d) with a foreign country identified pursuant to 
        subsection (b)(1) or (c) has not attained national treatment 
        for United States brokers and dealers within 2 years after the 
        date of such identification, the Secretary of the Treasury 
        shall publish in the Federal Register a notice that a foreign 
        country does not accord national treatment to United States 
        brokers or dealers and that negotiation has failed to attain 
        such national treatment.
            ``(2) Actions by commission.--If the Secretary of the 
        Treasury has published in the Federal Register (and has not 
        rescinded) a notice under paragraph (1) with respect to a 
        foreign country, the Commission shall, based upon the 
        determination concerning national treatment--
                    ``(A) deny any application filed by a person of 
                that foreign country, or
                    ``(B) prohibit any acquisition for which a notice 
                is required under paragraph (3) by a person of that 
                foreign country,
        unless the Commission, in consultation with the Secretary, 
        determines, on the record after notice and hearing, that such 
        denial or prohibition is contrary to the public interest.
            ``(3) Notice required to acquire broker or dealer.--
                    ``(A) In general.--If the Secretary of the Treasury 
                has published in the Federal Register (and has not 
                rescinded) a notice under paragraph (1) with respect to 
                a foreign country, no person of that foreign country, 
                acting directly or indirectly, shall acquire control of 
                any registered broker or dealer unless--
                            ``(i) the Commission has been given notice 
                        60 days in advance of the acquisition, in such 
                        form as the Commission shall prescribe by rule 
                        and containing such information as the 
                        Commission requires by rule or order; and
                            ``(ii) the Commission has not prohibited 
                        the acquisition.
                    ``(B) Commission may extend 60-day period.--The 
                Commission may, by order, extend the notice period 
                during which an acquisition may be prohibited under 
                subparagraph (A) for an additional 180 days.
                    ``(C) Effective date.--The requirements of 
                subparagraph (A) shall apply to any acquisition of 
                control that is completed on or after the date on which 
                the notice under paragraph (1) is published, 
                irrespective of when the acquisition was initiated.
            ``(4) Review.--The Secretary of the Treasury may, at any 
        time, and shall, annually, review any notice under paragraph 
        (1) and decide whether that notice should be rescinded.
    ``(f) National Treatment Defined.--A foreign country accords 
national treatment to United States brokers and dealers if it offers 
them the same competitive opportunities (including effective market 
access) as are available to its domestic brokers and dealers.
    ``(g) Persons of a Foreign Country Defined.--A person of a foreign 
country is a person that--
            ``(1) is organized under the laws of that country;
            ``(2) has its principal place of business in that country;
            ``(3) in the case of an individual--
                    ``(A) is a citizen of that country; or
                    ``(B) is domiciled in that country; or
            ``(4) is directly or indirectly controlled by a person 
        described in paragraph (1), (2), or (3).
    ``(h) Exercise of Discretion.--In exercising discretion under this 
section, the Secretary of the Treasury and the Commission shall act in 
a manner consistent with the obligations of the United States under a 
bilateral or multilateral agreement governing financial services 
entered into by the President and approved and implemented by the 
Congress.''.

SEC. 102. EFFECTUATING THE PRINCIPLE OF NATIONAL TREATMENT FOR 
              INVESTMENT ADVISERS.

    The Investment Advisers Act of 1940 (12 U.S.C. 80b-1 et seq.) is 
amended by adding at the end the following new section:

                          ``national treatment

    ``Sec. 223. (a) Purpose.--This section is intended to encourage 
foreign countries to accord national treatment to United States 
investment advisers that operate or seek to operate in those countries, 
and thereby end discrimination against United States investment 
advisers.
    ``(b) Reports Required.--The Secretary of the Treasury shall, not 
later than December 1, 1994, and biennially thereafter, submit to the 
Congress a report--
            ``(1) identifying any foreign country--
                    ``(A) that does not accord national treatment to 
                United States investment advisers; and
                    ``(B) with respect to which no notice under 
                subsection (e)(1) is in effect;
            ``(2) explaining why the Secretary has not published, or 
        has rescinded, such a notice with respect to that country; and
            ``(3) describing the results of any negotiations conducted 
        pursuant to subsection (d)(1) with respect to that country.
    ``(c) Discretionary Determinations.--The Secretary may, at any 
time, publish in the Federal Register a determination that a foreign 
country does not accord national treatment to United States investment 
advisers.
    ``(d) Negotiations Required.--
            ``(1) In general.--The Secretary of the Treasury shall 
        initiate negotiations with any foreign country in which, 
        according to the report under subsection (b) or any 
        determination under subsection (c), there is a significant 
        failure to accord national treatment to United States 
        investment advisers, to ensure that such country accords 
        national treatment to United States brokers or dealers.
            ``(2) Negotiations not required.--Paragraph (1) does not 
        require the Secretary of the Treasury to initiate negotiations 
        with a foreign country if the Secretary--
                    ``(A) determines that such negotiations would be 
                fruitless or would impair national economic interests; 
                and
                    ``(B) gives written notice of that determination to 
                the chairman and ranking minority member of the 
                Committee on Banking, Housing, and Urban Affairs of the 
                Senate and of the Committee on Energy and Commerce of 
                the House of Representatives.
    ``(e) Sanctions.--
            ``(1) Secretary's notice.--If negotiations pursuant to 
        subsection (d) with a foreign country identified pursuant to 
        subsection (b)(1) or (c) has not attained national treatment 
        for United States investment advisers within 2 years after the 
        date of such identification, the Secretary of the Treasury 
        shall publish in the Federal Register a notice that a foreign 
        country does not accord national treatment to United States 
        investment advisers and that negotiation has failed to attain 
        such national treatment.
            ``(2) Actions by commission.--If the Secretary of the 
        Treasury has published in the Federal Register (and has not 
        rescinded) a notice under paragraph (1) with respect to a 
        foreign country, the Commission shall, based upon the 
        determination concerning national treatment--
                    ``(A) deny any application filed by a person of 
                that foreign country, or
                    ``(B) prohibit any acquisition for which a notice 
                is required under paragraph (3) by a person of that 
                foreign country,
        unless the Commission, in consultation with the Secretary, 
        determines, on the record after notice and hearing, that such 
        denial or prohibition is contrary to the public interest.
            ``(3) Notice required to acquire investment adviser.--
                    ``(A) In general.--If the Secretary of the Treasury 
                has published in the Federal Register (and has not 
                rescinded) a notice under paragraph (1) with respect to 
                a foreign country, no person of that foreign country, 
                acting directly or indirectly, shall acquire control of 
                any registered investment adviser unless--
                            ``(i) the Commission has been given notice 
                        60 days in advance of the acquisition, in such 
                        form as the Commission shall prescribe by rule 
                        and containing such information as the 
                        Commission requires by rule or order; and
                            ``(ii) the Commission has not prohibited 
                        the acquisition.
                    ``(B) Commission may extend 60-day period.--The 
                Commission may, by order, extend the notice period 
                during which an acquisition may be prohibited under 
                subparagraph (A) for an additional 180 days.
                    ``(C) Effective date.--The requirements of 
                subparagraph (A) shall apply to any acquisition of 
                control that is completed on or after the date on which 
                the notice under paragraph (1) is published, 
                irrespective of when the acquisition was initiated.
            ``(4) Review.--The Secretary of the Treasury may, at any 
        time, and shall, annually, review any notice under paragraph 
        (1) and decide whether that notice should be rescinded.
    ``(f) National Treatment Defined.--A foreign country accords 
national treatment to United States investment advisers if it offers 
them the same competitive opportunities (including effective market 
access) as are available to its domestic investment advisers.
    ``(g) Persons of a Foreign Country Defined.--A person of a foreign 
country is a person that--
            ``(1) is organized under the laws of that country;
            ``(2) has its principal place of business in that country;
            ``(3) in the case of an individual--
                    ``(A) is a citizen of that country; or
                    ``(B) is domiciled in that country; or
            ``(4) is directly or indirectly controlled by a person 
        described in paragraph (1), (2), or (3).
    ``(h) Exercise of Discretion.--In exercising discretion under this 
section, the Secretary of the Treasury and the Commission shall act in 
a manner consistent with the obligations of the United States under a 
bilateral or multilateral agreement governing financial services 
entered into by the President and approved and implemented by the 
Congress.''.

SEC. 103. FINANCIAL INTERDEPENDENCE STUDY.

    (a) Investigation Required.--The Securities and Exchange 
Commission, in consultation and coordination with the Secretary of the 
Treasury, and any other appropriate Federal agency or department to be 
designated by the Securities and Exchange Commission, shall conduct an 
investigation to determine the extent of the interdependence of the 
securities industry and related financial services sector of the United 
States and foreign countries, and the economic, strategic, and other 
consequences of that interdependence for the United States.
    (b) Report.--The Securities and Exchange Commission shall transmit 
a report on the results of the investigation under subsection (a) 
within 2 years after the date of enactment of this section to the 
President, the Congress, the Secretary of the Treasury, and any other 
appropriate Federal agency or department as designated by the 
Securities and Exchange Commission. The report shall--
            (1) describe the activities and estimate the scope of 
        securities and related financial activities conducted by United 
        States firms in foreign markets (differentiated according to 
        major foreign markets);
            (2) describe the activities and estimate the scope of 
        securities and related financial activities conducted by 
        foreign firms in the United States (differentiated according to 
        the most significant home countries or groups of home 
        countries);
            (3) estimate the number of jobs created in the United 
        States by securities and related financial activities conducted 
        by foreign firms and the number of jobs created in foreign 
        countries by securities and related financial activities 
        conducted by United States firms;
            (4) estimate the additional jobs and revenues (both foreign 
        and domestic) that would be created by the securities and 
        related financial activities of United States firms in foreign 
        countries if those countries offered such firms the same 
        competitive opportunities (including effective market access) 
        as are available to those countries' domestic firms;
            (5) describe the extent to which foreign firms engaged in 
        securities and related financial services activities 
        discriminate against United States persons in procurement, 
        employment, providing credit, or other securities or related 
        financial services, or otherwise;
            (6) describe the extent to which foreign firms and other 
        persons from foreign countries purchase or otherwise facilitate 
        the marketing from the United States of government and private 
        debt instruments and private equity instruments;
            (7) describe how the interdependence of the securities 
        industry and related financial services sectors of the United 
        States and foreign countries affects the autonomy and 
        effectiveness of United States monetary policy;
            (8) describe the extent to which United States companies 
        rely on financing by or through foreign firms, and the 
        consequences of such reliance (including disclosure of 
        proprietary information) for the industrial competitiveness and 
        national security of the United States;
            (9) describe the extent to which foreign firms engaged in 
        securities and related financial services activities, in 
        purchasing high technology products such as computers and 
        telecommunications equipment, favor manufacturers from their 
        home countries over United States manufacturers; and
            (10) contain other appropriate information relating to the 
        results of the investigation under subsection (a).

           TITLE II--TELECOMMUNICATIONS PRODUCTS AND SERVICES

SEC. 201. EFFECTUATING THE PRINCIPLE OF NATIONAL TREATMENT FOR 
              PROVIDERS OF TELECOMMUNICATIONS PRODUCTS AND SERVICES.

    The Communications Act of 1934 (47 U.S.C. 151 et seq.) is amended 
by inserting after section 8 the following new section:

                          ``national treatment

    ``Sec. 9. (a) Purpose.--This section is intended to encourage 
foreign countries to accord national treatment to United States 
providers of telecommunications products and services that operate or 
seek to operate in those countries, and thereby end discrimination 
against United States providers of telecommunications products and 
services.
    ``(b) Notice.--If--
            ``(1) by the conclusion of the negotiating period 
        determined under section 1376(c) of the Omnibus Trade and 
        Competitiveness Act of 1988, the President is unable to enter 
        into an agreement under subtitle A of title I of such Act which 
        achieves the general negotiating objectives described in 
        section 1375(b) of that Act (as defined by the specific 
        objectives established by the President for that country); or
            ``(2) the United States Trade Representative has 
        determined, under section 1377(a)(2) of that Act, that any act, 
        policy, or practice of a foreign country that has entered into 
        an agreement described in section 1377(a)(1) of that Act--
                    ``(A) is not in compliance with the terms of such 
                agreement, or
                    ``(B) otherwise denies, within the context of the 
                terms of such agreement, to telecommunications products 
                and services of United States firms mutually 
                advantageous market opportunities in that foreign 
                country;
the United States Trade Representative shall publish a notice in the 
Federal Register identifying the foreign country and stating the 
objective which was not achieved (as described in paragraph (1)) or the 
act, policy, or practice which is not in such compliance or which 
denies such market opportunities (as described in paragraph (2)).
    ``(c) Actions by Commission.--If the United States Trade 
Representative has published in the Federal Register (and has not 
rescinded) a notice under subsection (b) with respect to a foreign 
country, the Commission shall, based upon the failure to negotiate or 
the act, policy, or practice identified in such notice, deny any 
application filed by a person of that foreign country, unless the 
Commission, in consultation with the United States Trade 
Representative, determines, on the record after notice and hearing, 
that such denial is contrary to the public interest.
    ``(d) Applications Subject to Evaluation.--The applications 
referred to in subsection (c) include--
            ``(1) any license or other application, request for 
        authorization or waiver, notice, tariff, or other document 
        required to be filed for approval by the Commission under this 
        Act; and
            ``(2) in the case of equipment subject to type acceptance 
        or type approval, any certification or other document required 
        to be submitted to the Commission.
    ``(e) Review.--The United States Trade Representative may, at any 
time, and shall, annually, review any notice under subsection (b) and 
decide whether that notice should be rescinded.
    ``(f) Definition.--A person of a foreign country is a person that--
            ``(1) is organized under the laws of that country;
            ``(2) has its principal place of business in that country;
            ``(3) in the case of an individual--
                    ``(A) is a citizen of that country; or
                    ``(B) is domiciled in that country; or
            ``(4) is directly or indirectly controlled by a person 
        described in paragraph (1), (2), or (3).''.

SEC. 202. NATIONAL TREATMENT WITH RESPECT TO EXTENSION OF LINES.

    Section 214 of the Communications Act of 1934 (47 U.S.C. 214) is 
amended by adding at the end the following new subsection:
    ``(e)(1) In making a determination of the public convenience and 
necessity with respect to an application filed under this section, the 
Commission shall take into account--
            ``(A) for each country identified in the application, 
        whether carriers whose principal place of business is the 
        United States have equivalent opportunity to provide 
        telecommunications services in such country as the applicant 
        seeks in the United States; and
            ``(B) whether the country that is the principal place of 
        business of the applicant affords to carriers whose principal 
        place of business is the United States opportunity to provide 
        telecommunications services that are comparable to the 
        opportunity the applicant seeks in the United States.
    ``(2) The Commission may, if it determines under subparagraph (A) 
or (B) of paragraph (1) that there is not equivalent or comparable 
opportunity to provide telecommunications services, find that granting 
such application is not in the public interest.''.

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