[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 1155 Introduced in Senate (IS)]

103d CONGRESS
  1st Session
                                S. 1155

To ensure that the Caribbean Basin Initiative is not adversely affected 
by the implementation of the North American Free Trade Agreement and to 
   apply ``fast track'' approval procedures to free trade agreements 
  entered into between the United States and certain Caribbean Basin 
                               countries.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                June 24 (legislative day, June 22), 1993

Mr. Graham (for himself, Mr. Durenberger, and Mr. Mack) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To ensure that the Caribbean Basin Initiative is not adversely affected 
by the implementation of the North American Free Trade Agreement and to 
   apply ``fast track'' approval procedures to free trade agreements 
  entered into between the United States and certain Caribbean Basin 
                               countries.

    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 ``Caribbean Basin Free Trade 
Agreements Act''.

SEC. 2. CONGRESSIONAL FINDINGS.

    The Congress finds that the continuation and strengthening of the 
commitment of the United States, as expressed by the enactment of the 
Caribbean Basin Economic Recovery Act and the Caribbean Basin Economic 
Recovery Expansion Act of 1990, to the successful development of the 
Caribbean region requires the enactment of provisions--
            (1) to encourage the continuation of structural reform 
        efforts by Caribbean countries toward market economies and 
        trade liberalization;
            (2) to preserve existing economic advantages under the 
        Caribbean Basin Initiative program and avoid the potential 
        diversion of investment from beneficiary countries under the 
        program to Mexico as a result of the North American Free Trade 
        Agreement;
            (3) to maintain and increase trade benefits under the 
        Caribbean Basin Initiative program in order to promote further 
        economic development and political stability in beneficiary 
        countries and to expand United States export opportunities in 
        the Caribbean region; and
            (4) to encourage and create further economic integration in 
        the Western Hemisphere through free trade arrangements that 
        provide United States business and labor reciprocal benefits 
        through the removal of barriers to trade and investment in 
        goods and services on a mutually advantageous basis.

 TITLE I--RELATIONSHIP OF NAFTA IMPLEMENTATION TO THE OPERATION OF THE 
                       CARIBBEAN BASIN INITIATIVE

SEC. 101. TEMPORARY PROVISIONS TO PROVIDE NAFTA PARITY TO BENEFICIARY 
              COUNTRY ECONOMIES.

    (a) Temporary Provisions.--Section 213(b) of the Caribbean Basin 
Economic Recovery Act (19 U.S.C. 2703(b)) is amended to read as 
follows:
    ``(b) Import-Sensitive Articles.--
            ``(1) In general.--Subject to paragraphs (2) through (5), 
        the duty-free treatment provided under this title does not 
        apply to--
                    ``(A) textile and apparel articles which are 
                subject to textile agreements;
                    ``(B) footwear not designated at the time of the 
                effective date of this title as eligible articles for 
                the purpose of the generalized system of preferences 
                under title V of the Trade Act of 1974;
                    ``(C) tuna, prepared or preserved in any manner, in 
                airtight containers;
                    ``(D) petroleum, or any product derived from 
                petroleum, provided for in headings 2709 and 2710 of 
                the Harmonized Tariff Schedule of the United States;
                    ``(E) watches and watch parts (including cases, 
                bracelets and straps), of whatever type including, but 
                not limited to, mechanical, quartz digital or quartz 
                analog, if such watches or watch parts contain any 
                material which is the product of any country with 
                respect to which HTS column 2 rates of duty apply; or
                    ``(F) articles to which reduced rates of duty apply 
                under subsection (h).
            ``(2) NAFTA transition period treatment of certain textile 
        and apparel articles.--
                    ``(A) Equivalent tariff and quota treatment.--
                During the transition period--
                            ``(i) the tariff treatment accorded at any 
                        time to any textile or apparel article that 
                        originates in the territory of a beneficiary 
                        country shall be identical to the tariff 
                        treatment that is accorded during such time 
                        under section 2 of the Annex to a like article 
                        that originates in the territory of Mexico and 
                        is imported into the United States;
                            ``(ii) duty-free treatment under this title 
                        shall apply to any textile or apparel article 
                        of a beneficiary country that is imported into 
                        the United States and that--
                                    ``(I) meets the same requirements 
                                (other than assembly in Mexico) as 
                                those specified in Appendix 2.4 of the 
                                Annex (relating to goods assembled from 
                                fabric wholly formed and cut in the 
                                United States) for the duty free entry 
                                of a like article assembled in Mexico; 
                                or
                                    ``(II) is identified under 
                                subparagraph (C) as a handloomed, 
                                handmade, or folklore article of such 
                                country and is certified as such by the 
                                competent authority of such country; 
                                and
                            ``(iii) no quantitative restriction or 
                        consultation level may be applied to the 
                        importation into the United States of any 
                        textile or apparel article that--
                                    ``(I) originates in the territory 
                                of a beneficiary country,
                                    ``(II) meets the same requirements 
                                (other than assembly in Mexico) as 
                                those specified in Appendix 3.1.B.10 of 
                                the Annex (relating to goods assembled 
                                from fabric wholly formed and cut in 
                                the United States) for the exemption of 
                                a like article assembled in Mexico from 
                                United States quantitative restrictions 
                                and consultation levels, or
                                    ``(III) qualifies for duty-free 
                                treatment under clause (ii)(II).
                    ``(B) NAFTA transition period treatment of 
                nonoriginating textile and apparel articles.--
                            ``(i) Preferential tariff treatment.--
                        Subject to clause (ii), the United States Trade 
                        Representative may place in effect at any time 
                        during the transition period with respect to 
                        any textile or apparel article that--
                                    ``(I) is a product of a beneficiary 
                                country; but
                                    ``(II) does not qualify as a good 
                                that originates in the territory of 
                                that country;
                        tariff treatment that is identical to the 
                        preferential tariff treatment that is accorded 
                        during such time under Appendix 6.B of the 
                        Annex to a like article that is a product of 
                        Mexico and imported into the United States.
                            ``(ii) Prior consultation.--The United 
                        States Trade Representative may implement the 
                        preferential tariff treatment described in 
                        clause (i) only after consultation with 
                        representatives of the United States textile 
                        and apparel industry and other interested 
                        parties regarding--
                                    ``(I) the specific articles to 
                                which such treatment will be extended,
                                    ``(II) the annual quantity levels 
                                to be applied under such treatment and 
                                any adjustment to such levels,
                                    ``(III) the allocation of such 
                                annual quantities among the beneficiary 
                                countries that export the articles 
                                concerned to the United States, and
                                    ``(IV) any other applicable 
                                provision.
                            ``(iii) Adjustment of certain bilateral 
                        textile agreements.--The United States Trade 
                        Representative shall undertake negotiations for 
                        purposes of seeking appropriate reductions in 
                        the quantities of textile and apparel articles 
                        that are permitted to be imported into the 
                        United States under bilateral agreements with 
                        beneficiary countries in order to reflect the 
                        quantities of textile and apparel articles of 
                        each respective country that are exempt from 
                        quota treatment by reason of paragraph 
                        (2)(A)(iii).
                    ``(C) Handloomed, handmade, and folklore 
                articles.--For purposes of subparagraph (A), the United 
                States Trade Representative shall consult with 
                representatives of the beneficiary country for the 
                purpose of identifying particular textile and apparel 
                goods that are mutually agreed upon as being 
                handloomed, handmade, or folklore goods of a kind 
                described in section 2.3(a), (b), or (c) or Appendix 
                3.1.B.11 of the Annex.
                    ``(D) Bilateral emergency actions.--The President 
                may take--
                            ``(i) bilateral emergency tariff actions of 
                        a kind described in section 4 of the Annex with 
                        respect to any textile or apparel article 
                        imported from a beneficiary country if the 
                        application of tariff treatment under 
                        subparagraph (A) to such article results in 
                        conditions that would be cause for the taking 
                        of such actions under such section 4 with 
                        respect to a like article that is a product of 
                        Mexico; or
                            ``(ii) bilateral emergency quantitative 
                        restriction actions of a kind described in 
                        section 5 of the Annex with respect to imports 
                        of any textile or apparel article described in 
                        subparagraph (B)(i)(I) and (II) if the 
                        importation of such article into the United 
                        States results in conditions that would be 
                        cause for the taking of such actions under such 
                        section 5 with respect to a like article that 
                        is a product of Mexico.
            ``(3) NAFTA transition period treatment of certain other 
        articles originating in beneficiary countries.--
                    ``(A) Equivalent tariff treatment.--
                            ``(i) In general.--Subject to clause (ii), 
                        the tariff treatment accorded at any time 
                        during the transition period to any article 
                        referred to in any of subparagraphs (B) through 
                        (F) of paragraph (1) that originates in the 
                        territory of a beneficiary country shall be 
                        identical to the tariff treatment that is 
                        accorded during such time under Annex 302.2 of 
                        the NAFTA to a like article that originates in 
                        the territory of Mexico and is imported into 
                        the United States. Such articles shall be 
                        subject to the provisions for emergency action 
                        under chapter 8 of part two of the NAFTA to the 
                        same extent as if such articles were imported 
                        from Mexico.
                            ``(ii) Exception.--Clause (i) does not 
                        apply to any article accorded duty-free 
                        treatment under U.S. Note 2(b) to subchapter II 
                        of chapter 98 of the Harmonized Tariff Schedule 
                        of the United States.
                    ``(B) Relationship to subsection (h) duty 
                reductions.--If at any time during the transition 
                period the rate of duty that would (but for action 
                taken under subparagraph (A)(i) in regard to such 
                period) apply with respect to any article under 
                subsection (h) is a rate of duty that is lower than the 
                rate of duty resulting from such action, then such 
                lower rate of duty shall be applied for the purposes of 
                implementing such action.
            ``(4) Customs procedures.--The provisions of chapter 5 of 
        part two of the NAFTA regarding customs procedures apply to 
        importations under paragraphs (2) and (3) of articles from 
        beneficiary countries.
            ``(5) Definitions.--As used in this subsection--
                    ``(A) The term `the Annex' means Annex 300-B of the 
                NAFTA.
                    ``(B) The term `NAFTA' means the North American 
                Free Trade Agreement entered into between the United 
                States, Mexico, and Canada on December 17, 1992.
                    ``(C) The term `textile or apparel article' means 
                any article referred to in paragraph (1)(A) that is a 
                good listed in Appendix 1.1 of the Annex.
                    ``(D) The term `transition period' means, with 
                respect to a beneficiary country, the period that 
                begins on the date that the NAFTA enters into force 
                with respect to the United States, and ends on the 
                earlier of--
                            ``(i) the date that is the 3rd anniversary 
                        of the date on which the NAFTA enters into 
                        force; or
                            ``(ii) the date on which--
                                    ``(I) there enters into force with 
                                respect to the United States a trade 
                                agreement entered into under the 
                                authority of section 202(a) of the 
                                Caribbean Basin Free Trade Agreements 
                                Act and to which the beneficiary 
                                country is a party, or
                                    ``(II) the beneficiary country 
                                accedes to the NAFTA.
                    ``(E) An article shall be treated as having 
                originated in the territory of a beneficiary country if 
                the article meets the rules of origin for a good set 
                forth in chapter 4 of part two of the NAFTA or in 
                Appendix 6.A of the Annex. In applying such chapter 4 
                or Appendix 6.A with respect to a beneficiary country 
                for purposes of this subsection, no countries other 
                than the United States and beneficiary countries may be 
                treated as being Parties to the NAFTA.''.
    (b) Conforming Amendments.--The Caribbean Basin Economic Recovery 
Act is further amended--
            (1) by amending section 212(e)(1)(B) to read as follows:
                    ``(B) withdraw, suspend, or limit the application 
                of the duty-free treatment under this subtitle, and the 
                tariff and preferential tariff treatment under section 
                213(b)(2) and (3), to any article of any country,''; 
                and
            (2) by inserting ``and except as provided in section 
        213(b)(2) and (3),'' after ``Tax Reform Act of 1986,'' in 
        section 213(a)(1).

            TITLE II--CARIBBEAN BASIN FREE TRADE AGREEMENTS

SEC. 201. TRADE AGREEMENT FEASIBILITY AND OBJECTIVES.

    As soon as practicable, the United States Trade Representative 
shall determine the desirability and feasibility of, and a likely 
timetable for, any country that is a beneficiary country for purposes 
of the Caribbean Basin Economic Recovery Act, or a group of such 
beneficiary countries, either--
            (1) acceding to--
                    (A) the North American Free Trade Agreement 
                pursuant to Article 2204 of such Agreement, and
                    (B) as appropriate, supplemental agreements 
                pertaining to environmental, labor, and import issues; 
                or
            (2) entering into comprehensive bilateral or multilateral 
        agreements with the United States that contain provisions 
        that--
                    (A) are comparable to the provisions of the North 
                American Free Trade Agreement and, as appropriate, to 
                the provisions of supplemental agreements pertaining to 
                environmental, labor, and import issues, and
                    (B) will achieve the applicable purposes, policies, 
                and objectives set forth in section 212(b) and (c) of 
                the Caribbean Basin Economic Recovery Act and section 
                1101 of the Omnibus Trade and Competitiveness Act of 
                1988.
The United States Trade Representative shall consult with the Committee 
on Ways and Means of the House of Representatives and the Committee on 
Finance of the Senate regarding the determinations made under this 
section.

SEC. 202. TRADE AGREEMENT NEGOTIATING AUTHORITY.

    (a) In General.--
            (1) Effective period of authority.--Before June 1, 1996, 
        the President may enter into trade agreements with one or more 
        beneficiary countries under the Caribbean Basin Economic 
        Recovery Act providing for the elimination or reduction of any 
        duty imposed by the United States and for the reduction or 
        elimination of barriers to, or other distortions of, the 
        international trade of the beneficiary countries or the United 
        States, if each such agreement would comply with section 
        201(2).
            (2) Limitation.--Notwithstanding any other provision of 
        law, no trade benefit shall be extended to any country by 
        reason of the extension of any trade benefit to another country 
        under a trade agreement entered into under paragraph (1) with 
        such other country.
    (b) Consultation With Congress Before Agreements Entered Into.--
            (1) Before the President enters into any trade agreement 
        under subsection (a), the President shall consult with--
                    (A) the Committee on Ways and Means of the House of 
                Representatives and the Committee on Finance of the 
                Senate; and
                    (B) each other committee of the House and the 
                Senate, and each joint committee of the Congress, which 
                has jurisdiction over legislation involving subject 
                matters which would be affected by the trade agreement.
            (2) The consultation under paragraph (1) shall include--
                    (A) the nature of the agreement;
                    (B) how and to what extent the agreement will 
                achieve the applicable purposes, policies, and 
                objectives of this title; and
                    (C) all matters relating to the implementation of 
                the agreement under section 203.
            (3) If it is proposed to implement two or more trade 
        agreements in a single implementing bill under section 203(a), 
        the consultation under paragraph (1) shall include the 
        desirability and feasibility of such proposed implementation.

SEC. 203. IMPLEMENTATION OF TRADE AGREEMENTS.

    (a) In General.--
            (1) Requirements for entering into force.--Any agreement 
        entered into under section 202(a) shall enter into force with 
        respect to the United States if (and only if)--
                    (A) the President, at least 90 calendar days before 
                the day on which he enters into the trade agreement, 
                notifies the House of Representatives and the Senate of 
                his intention to enter into the agreement, and promptly 
                thereafter publishes notice of such intention in the 
                Federal Register;
                    (B) after entering into the agreement, the 
                President submits a document to the House of 
                Representatives and to the Senate containing a copy of 
                the final legal text of the agreement, together with--
                            (i) a draft of an implementing bill,
                            (ii) a statement of any administrative 
                        action proposed to implement the trade 
                        agreement, and
                            (iii) the supporting information described 
                        in paragraph (2); and
                    (C) the implementing bill is enacted into law.
            (2) Supporting information.--The supporting information 
        required under paragraph (1)(B)(iii) consists of--
                    (A) an explanation as to how the implementing bill 
                and proposed administrative action will change or 
                affect existing law; and
                    (B) a statement--
                            (i) asserting that the agreement makes 
                        progress in achieving the agreement 
                        requirements set forth in section 201(2) (A) 
                        and (B), and
                            (ii) setting forth the reasons of the 
                        President regarding--
                                    (I) how and to what extent the 
                                agreement makes progress in achieving 
                                the agreement requirements set forth in 
                                section 201(2) (A) or (B), and why and 
                                to what extent the agreement does not 
                                achieve other applicable purposes, 
                                policies, and objectives,
                                    (II) how the agreement serves the 
                                interests of United States commerce, 
                                and
                                    (III) why the implementing bill and 
                                proposed administrative action is 
                                required or appropriate to carry out 
                                the agreement.
            (3) Application.--To ensure that a foreign country which 
        receives benefits under a trade agreement entered into under 
        section 202(a) is subject to the obligations imposed by such 
        agreement, the President shall recommend to Congress in the 
        implementing bill and statement of administrative action 
        submitted with respect to such agreement that the benefits and 
        obligations of such agreement apply solely to the parties to 
        such agreement, if such application is consistent with the 
        terms of such agreement. The President may also recommend with 
        respect to any such agreement that the benefits and obligations 
        of such agreement not apply uniformly to all parties to such 
        agreement, if such application is consistent with the terms of 
        such agreement.
    (b) Application of Congressional ``Fast Track'' Procedures to 
Implementing Bills.--The provisions of section 151 of the Trade Act of 
1974 (19 U.S.C. 2191) apply to implementing bills submitted with 
respect to trade agreements entered into under section 202(a) before 
June 1, 1996.
    (c) Conforming Amendment.--Section 151(b)(1) of the Trade Act of 
1974 (19 U.S.C. 2191(b)(1)) is amended by striking out ``or section 
1103(a)(1) of the Omnibus Trade and Competitiveness Act of 1988'' and 
inserting ``, section 1103(a)(1) of the Omnibus Trade and 
Competitiveness Act of 1988, and section 202(a) of the Caribbean Basin 
Free Trade Agreements Act''.

                                 <all>

S 1155 IS----2