[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 646 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                 S. 646

To ensure the competitiveness of the United States textile and apparel 
                               industry.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 24, 1997

  Mr. Ford (for himself, Mr. Hollings, Mr. Helms, Mr. Faircloth, Mr. 
 Thurmond, Mr. Cochran, Mr. Robb, Mr. Sessions, Mr. Warner, Mr. Byrd, 
 Mr. Breaux, Ms. Collins, Ms. Landrieu, Mr. McConnell, and Mr. Shelby) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To ensure the competitiveness of the United States textile and apparel 
                               industry.

    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 ``Customs Enforcement and Market 
Access Act of 1997''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) the textile and apparel industry is a key part of the 
        United States manufacturing base and the third largest 
        manufacturing complex in the United States economy;
            (2) textile and apparel facilities are often located in 
        economically sensitive regions;
            (3) the industry has demonstrated an ability to compete in 
        the global economy where market access is available;
            (4) the domestic textile and apparel industry has committed 
        significant resources to be competitive and productive;
            (5) workers in the industry make the highest quality 
        textile and apparel goods in the world and are the world's most 
        productive;
            (6) the industry is preparing to compete in the world 
        market without the protection of import quotas authorized by 
        the Multifiber Arrangement;
            (7) United States trade policy should be oriented toward 
        expanding exports and ensuring that United States trade laws 
        are vigorously enforced; and
            (8) the Committee for the Implementation of Textile 
        Agreements, the Office of Textiles, Apparel, and Consumer Goods 
        of the Department of Commerce, and the Ambassador for Textiles 
        and Apparel in the Office of the United States Trade 
        Representative--
                    (A) play central and indispensable roles in 
                administering the laws governing trade in textile and 
                apparel goods;
                    (B) have diligently carried out laws enacted by the 
                Congress and under powers delegated to them by the 
                President; and
                    (C) have acted in accordance with United States and 
                international law.

SEC. 3. MARKET ACCESS FOR UNITED STATES TEXTILE AND APPAREL PRODUCTS.

    (a) Accession Protocols.--In any case in which the United States 
negotiates a protocol for accession of a country to the World Trade 
Organization, the Trade Representative shall negotiate for inclusion in 
that protocol, in addition to any other provisions, the following:
            (1) Provisions for effective market access to that 
        country's domestic markets for textile and apparel products of 
        the United States.
            (2) Provisions allowing the suspension or revocation of the 
        provisions of paragraph 14 (relating to increasing import 
        levels based on growth rates) of the Agreement on Textiles and 
        Clothing if the United States determines that the country has 
        failed to enforce the provisions referred to in paragraph (1).
    (b) Bilateral Agreements With Countries That Are Not WTO Members.--
In any case in which the United States negotiates a textile agreement 
with a country that is not a WTO member, including any agreement 
negotiated pursuant to section 5 of this Act, the Trade Representative 
shall negotiate for inclusion in that textile agreement, in addition to 
any other provisions, the following:
            (1) Provisions for effective market access to that 
        country's domestic markets for textile and apparel products of 
        the United States.
            (2) Provisions that recognize the right of the United 
        States to pursue remedies under United States law, including 
        section 301 of the Trade Act of 1974, to respond to the denial 
        of market access described in paragraph (1).
    (c) Review of Textile Agreements.--The Trade Representative shall 
take into account the compliance of countries with the provisions 
negotiated under subsections (a) and (b) in identifying countries for 
purposes of section 183 of the Trade Act of 1974, as added by 
subsection (d) of this section.
    (d) Priority Foreign Countries.--
            (1) In general.--Chapter 8 of title I of the Trade Act of 
        1974 (19 U.S.C. 2241 and following) is amended by adding at the 
        end the following new section:

``SEC. 183. IDENTIFICATION OF COUNTRIES THAT DENY MARKET ACCESS FOR 
              TEXTILE AND APPAREL PRODUCTS.

    ``(a) In General.--Not later than the date that is 30 days after 
the date on which the annual report is submitted to congressional 
committees under section 181(b), the United States Trade Representative 
(hereafter referred to as the `Trade Representative') shall identify--
            ``(1) those foreign countries that deny fair and equitable 
        market access to United States persons that produce or sell 
        textile or apparel products, and
            ``(2) those foreign countries identified under paragraph 
        (1) that are determined by the Trade Representative to be 
        priority foreign countries.
    ``(b) Special Rules for Identifications.--In identifying priority 
foreign countries under subsection (a), the following shall apply:
            ``(1) In identifying priority foreign countries under 
        subsection (a)(2), the Trade Representative shall identify only 
        those foreign countries--
                    ``(A) that have the most onerous or egregious acts, 
                policies, or practices that deny fair and equitable 
                market access to United States persons that sell or 
                produce textile or apparel products,
                    ``(B) whose acts, policies, or practices described 
                in subparagraph (A) have the greatest adverse impact 
                (actual or potential) on the relevant United States 
                products, and
                    ``(C) that are not--
                            ``(i) entering into good faith 
                        negotiations, or
                            ``(ii) making significant progress in 
                        bilateral or multilateral negotiations,
                to provide adequate and effective market access for 
                textile and apparel products of the United States.
            ``(2) In identifying foreign countries under subsection 
        (a)(2), the Trade Representative shall--
                    ``(A) consult with the Chair of the Committee for 
                the Implementation of Textile Agreements and other 
                appropriate officers of the Federal Government, and
                    ``(B) take into account information from such 
                sources as may be available to the Trade Representative 
                and such information as may be submitted to the Trade 
                Representative in reports submitted under section 
                181(b) and petitions submitted under section 302.
            ``(3) The Trade Representative may identify a foreign 
        country under subsection (a)(1) only if the Trade 
        Representative finds that there is a factual basis for the 
        denial of fair and equitable market access as a result of the 
        violation of international law or an international agreement, 
        or the existence of barriers referred to in subsection (d)(1).
            ``(4) In identifying foreign countries under paragraphs (1) 
        and (2) of subsection (a), the Trade Representative shall take 
        into account--
                    ``(A) the history of market access laws and 
                practices of the foreign country, including any 
                previous identification under subsection (a)(2); and
                    ``(B) the history of efforts of the United States, 
                and the response of the foreign country, to achieve 
                fair and equitable market access for textile and 
                apparel products.
    ``(c) Revocations and Additional Identifications.--
            ``(1) In general.--The Trade Representative may at any 
        time--
                    ``(A) revoke the identification of any foreign 
                country as a priority foreign country under this 
                section, or
                    ``(B) identify a foreign country as a priority 
                foreign country under this section,
        if information available to the Trade Representative indicates 
        that such action is appropriate.
            ``(2) Reports to congress.--The Trade Representative shall 
        include in the semiannual report submitted to the Congress 
        under section 309(3) a detailed explanation of the 
        identification of any foreign country as a priority foreign 
        country under this section.
    ``(d) Definitions.--For the purposes of this section--
            ``(1) a foreign country denies fair and equitable market 
        access if the foreign country effectively denies access for 
        textile or apparel products of the United States through the 
        use of laws, procedures, practices, or regulations which--
                    ``(A) violate provisions of international law or 
                international agreements to which both the United 
States and the foreign country are parties, or
                    ``(B) constitute discriminatory nontariff trade 
                barriers;
            ``(2) a foreign country may be determined to deny fair and 
        equitable market access for textile or apparel products, 
        notwithstanding the fact that the foreign country may be in 
        compliance with the specific obligations of the Agreement on 
        Textiles and Clothing referred to in section 101(d)(4) of the 
        Uruguay Round Agreements Act; and
            ``(3) fair and equitable market access is not demonstrated 
        only by access for those textile and apparel products that are 
        subsequently reexported to the United States as finished 
        textile or apparel products.
In determining whether a foreign country denies fair and equitable 
market access, the Trade Representative shall consider whether the 
foreign country has enacted and is enforcing laws which prevent and 
punish the manufacture, sale, or exportation of counterfeit textile and 
apparel goods.
    ``(e) Publication.--The Trade Representative shall publish in the 
Federal Register a list of foreign countries identified under 
subsection (a) and shall make such revisions to the list as may be 
required by reason of action under subsection (c).''.
            (2) Conforming amendment.--The table of contents for the 
        Trade Act of 1974 is amended by inserting after the item 
        relating to section 182 the following new item:

``Sec. 183. Identification of countries that deny market access for 
                            textile and apparel products.''.
            (3) Title iii action.--Section 302(b)(2)(A) of the Trade 
        Act of 1974 (19 U.S.C. 2412(b)(2)(A)) is amended by inserting 
        ``or section 183(a)(2)'' after ``182(a)(2)''.

SEC. 4. TEXTILE GLOBAL COMPETITIVENESS RESEARCH FUND.

    (a) Establishment.--There is established in the United States 
Treasury a Textile Global Competitiveness Research Fund (hereafter in 
this Act referred to as the ``Fund'').
    (b) Use of Fund.--Amounts in the Fund shall be available, as 
provided in appropriations Acts, in accordance with subsection (c)--
            (1) for programs aimed at enhancing the international 
        competitiveness of the United States textile and apparel 
        manufacturers; and
            (2) to the Customs Service for the enforcement of laws 
        governing trade in textile and apparel goods.
    (c) Funding.--
            (1) Deposits.--There shall be deposited in the Fund in each 
        fiscal year the amount, if any, by which--
                    (A) the amount collected in fines by virtue of the 
                amendments made by section 9 exceed
                    (B) the total amount collected for violations 
                involving textile and apparel goods during fiscal year 
                1997 under section 592 of the Tariff Act of 1930, as in 
                effect on the day before the date of the enactment of 
                this Act, adjusted in accordance with paragraph (2).
            (2) Adjustment.--(A) The amount referred to in paragraph 
        (1)(B) shall be increased in each fiscal year beginning in 
        fiscal year 1999 by an amount equal to the amount described in 
        paragraph (1)(B) multiplied by the cost-of-living adjustment.
            (B) For purposes of subparagraph (A), the cost-of-living 
        adjustment for any fiscal year is the percentage (if any) by 
        which--
                    (i) the CPI for the preceding fiscal year, exceeds
                    (ii) the CPI for the fiscal year 1997.
            (C) For purposes of subparagraph (B), the CPI for any 
        fiscal year is the average of the Consumer Price Index as of 
        the close of the 12-month period ending on August 31 of such 
        fiscal year.
            (D) For purposes of subparagraph (C), the term ``Consumer 
        Price Index'' means the last Consumer Price Index for all-urban 
        consumers published by the Department of Labor.
            (E) If any increase determined under this paragraph is not 
        a multiple of $100, such increase shall be rounded to the 
        nearest multiple of $100.
            (3) Allocations.--(A) 25 percent of the amounts deposited 
        in the Fund in each fiscal year shall be made available to the 
        Customs Service under subsection (b)(2).
            (B) 75 percent of the amounts deposited in the Fund in each 
        fiscal year shall be made available for programs designated 
        pursuant to subsection (b)(1).
    (d) Annual Report to Congress.--The Secretary of Commerce shall 
submit to the Congress, not later than April 1 of each year, a report 
on the contribution to the United States economy of the domestic 
textile and apparel industry.

SEC. 5. TEXTILE AND APPAREL QUOTA LEVELS.

    (a) For Countries That Are Not WTO Members and Do Not Have Textile 
Agreements With the United States.--
            (1) If exports to the united states exceed $100,000,000 
        annually or are creating serious damage or actual threat 
        thereof.--The Trade Representative shall take the necessary 
        steps to negotiate an agreement, in accordance with paragraph 
        (2), between the United States and any country that--
                    (A) is not a WTO member and is not a country to 
                which section 3(a) applies,
                    (B) is not a party to a textile agreement with the 
                United States, and
                    (C) whose exports to the United States of textile 
                and apparel goods--
                            (i) are valued at more than $100,000,000 in 
                        the most recent 12-month period ending on the 
                        last day of the preceding month; or
                            (ii) are creating serious damage or actual 
                        threat thereof to the domestic industry in the 
                        United States in any textile category 
                        established by CITA.
            (2) Contents of agreements.--It is the sense of the 
        Congress that an agreement negotiated with a country under 
        paragraph (1) should establish maximum amounts of textile and 
        apparel products of that country that may be imported into the 
        United States that do not exceed--
                    (A) in the first 12-month period that the agreement 
                is in effect, an increase of more than 8 percent of the 
                total volume in square meter equivalents of all textile 
                and apparel products of that country imported in the 
                12-month period ending on the date the negotiations 
                began; and
                    (B) in each subsequent 12-month period that the 
                agreement is in effect, an increase of not more than 
                the percentage of growth in the domestic market in the 
                United States for all textile and apparel products in 
                the preceding 12-month period.
            (3) Inclusion of other provisions.--Those provisions 
        required to be included in an agreement under section 3(b) may 
        be included in the agreement negotiated under this subsection.
            (4) Determinations of serious damage or actual threat 
        thereof.--CITA shall make the determinations of serious damage 
        or actual threat thereof referred to in paragraph (2), using 
        the criteria set forth in paragraph 3 of Article 6 of the 
        Agreement on Textiles and Clothing.
    (b) For Countries That Are Not WTO Members and Have Textile 
Agreements With the United States.--
            (1) In general.--In the case of a country that is not a WTO 
        member but is a party to a textile agreement with the United 
        States, the Trade Representative shall take the necessary steps 
        to negotiate a textile agreement to go into effect when the 
        current agreement expires.
            (2) Sense of congress.--It is the sense of Congress that an 
        agreement negotiated under paragraph (1) should permit imports 
        of textile and apparel products of that country, during each 
        12-month period that the agreement is in effect, to increase by 
        not more than the percentage of growth in the domestic market 
        in the United States for all textile and apparel products in 
        the preceding 12-month period.
    (c) For Countries That Are Acceding To the WTO.--In any case in 
which the United States negotiates a protocol for accession to the WTO 
under section 3(a), the Trade Representative shall negotiate for 
inclusion in that protocol provisions that require that the 10-year 
period provided in the Agreement on Textiles and Clothing for phasing 
out of quotas under that Agreement begin, with respect to that country, 
on the day on which that country accedes to the WTO.

SEC. 6. CIRCUMVENTION OF TEXTILE AGREEMENTS.

    (a) Policy for Countries That Are Not WTO Members.--In the case of 
any country that is not a WTO member and--
            (1) is negotiating a protocol with the United States for 
        that country's accession to the World Trade Organization,
            (2) is a party to a bilateral agreement with the United 
        States that governs imports into the United States of textile 
        and apparel products of that country, or
            (3) is a country with which the United States is 
        negotiating an agreement under section 5(a),
the Trade Representative shall ensure that the protocol under paragraph 
(1), a subsequent agreement to replace the agreement under paragraph 
(2) when it expires, or the agreement described in paragraph (3), as 
the case may be, provides for a reduction in the quantity of textile 
and apparel goods of that country that may be imported into the United 
States if CITA determines that the agreement is being circumvented and 
that no, or inadequate measures, are being applied by that country to 
take action against such circumvention. Any determination by CITA under 
the preceding sentence shall be made in accordance with the standards 
set forth in section 8.
    (b) Definitions.--For purposes of this section, a reduction in a 
country's textile and apparel quotas is a reduction in quantitative 
limitations otherwise applicable to imports into the United States of 
that country's textile and apparel products that is equal to--
            (1) the quantity of the goods involved in the circumvention 
        if the circumvention is the first within the most recent 36-
        month period;
            (2) twice the quantity of goods involved in the 
        circumvention if the circumvention is the second in the most 
        recent 36-month period; or
            (3) three times the quantity of goods involved in the 
        circumvention if the circumvention is the third or more in the 
        most recent 36-month period.
    (c) Policy for WTO Members.--In any case in which a WTO member is 
found by CITA to have circumvented the Agreement on Textiles and 
Clothing or any other textile agreement, CITA shall pursue the maximum 
penalty consistent with the WTO.

SEC. 7. CUSTOMS ENFORCEMENT ACTION.

    (a) Sharing of Customs Information With CITA.--The Customs Service 
shall, upon initiating an investigation relating to a violation of the 
laws of the United States governing international trade in textile and 
apparel goods, inform the Chairman of CITA of the investigation in any 
case in which the alleged violation, if true, would constitute a 
circumvention of any textile agreement. In any such case, the Customs 
Service shall provide to the Chairman of CITA--
            (1) all information the Chairman of CITA requests that is 
        relevant to the alleged violation and required in order for 
        CITA to pursue a charge against the quotas on imports of 
        textile and apparel products of that country as a result of the 
        violation; and
            (2) notification, at least every 30 days until the 
        investigation is referred to the Department of Justice or the 
        Customs Service closes the investigation, of the progress of 
        the investigation.
    (b) Factors in Proceeding With Charges Against Quotas.--In deciding 
whether to pursue a charge described in subsection (a) as a result of 
an alleged violation described in subsection (a), CITA, in addition to 
any other relevant factors which CITA may consider, shall weigh the 
impact of proceeding with such charge on potential prosecutions or 
civil penalties and future enforcement of textile agreements, and shall 
consider the amount of the alleged violation, the probability of 
successful criminal prosecution, the degree of compliance by the true 
country of origin with textile agreements, and the damage the alleged 
violation would inflict on the domestic textile and apparel industry.
    (c) Decision Not To Pursue a Charge.--In any case in which CITA 
decides under subsection (b) not to pursue a charge, the Customs 
Service shall, as long as that decision is in effect, report to the 
Chairman of CITA, in lieu of the reports under subsection (a)(2)--
            (1) at least once every 6 months from the date on which the 
        Customs Service initiated the case, on the status of the 
        investigation; and
            (2) within 10 business days after the Customs Service 
        obtains new information or evidence materially relevant to the 
        alleged violation.
    (d) Standing Not Provided.--Nothing in this Act shall be construed 
to provide standing in any court or administrative proceeding for legal 
action against the United States arising from actions taken in carrying 
out the laws governing trade in textile or apparel goods.
    (e) Referral of Cases to Department of Justice.--In any case in 
which--
            (1) the Customs Service refers an alleged violation 
        described in subsection (a) to the Department of Justice for 
        prosecution, and
            (2) no indictment has been brought in the case within 6 
        months after the referral,
the Attorney General shall provide to the Chairman of CITA all 
information relevant to imposing a charge against the quotas on imports 
of textile and apparel products of the country concerned as a result of 
the violation. The Chairman of CITA may extend the 6-month period 
referred to in paragraph (2) if requested to do so by the Attorney 
General.
    (f) Disclosure of Certain Confidential Information Not Required.--
Nothing in this section shall be construed to require the disclosure by 
the Customs Service or the Department of Justice of confidential 
information relevant to possible imposition of criminal or civil 
penalties when that information is not relevant to the imposition of a 
charge by CITA against the quotas on imports of textile and apparel 
products of a country.
    (g) Initiation of Investigations.--
            (1) Basis for initiation.--Subject to paragraph (2), 
        whenever the Customs Service receives credible evidence that 
        circumvention of a textile agreement has occurred, the Customs 
        Service shall initiate an investigation, to which a customs 
        officer shall be assigned, to determine if such circumvention 
        has occurred, unless such evidence is directly related to an 
open investigation commenced prior to the receipt of such evidence.
            (2) Waiver.--The head of the Division of Textile 
        Enforcement established under section 10 may determine not to 
        initiate an investigation under paragraph (1) if he or she 
        transmits to CITA a report setting forth the reasons for that 
        determination.

SEC. 8. STANDARDS OF PROOF.

    (a) In General.--CITA may determine that a country has circumvented 
a textile agreement if CITA determines, after consultations with the 
country concerned, that there is a substantial likelihood that the 
circumvention occurred.
    (b) Failure of Country To Cooperate.--
            (1) Reliance on best available information.--If a country 
        fails to cooperate with CITA in an investigation to determine 
        if a textile agreement has been circumvented, CITA shall base 
        its determination on the best available information.
            (2) Acts constituting failure to cooperate.--Acts 
        indicating failure of a country to cooperate under paragraph 
        (1) include, but are not limited to--
                    (A) denying or unreasonably delaying entry of 
                officials of the Customs Service to investigate 
                violations of, or promote compliance with, any textile 
                agreement;
                    (B) providing appropriate United States officials 
                with inaccurate or incomplete information, including 
                information demonstrating compliance with United States 
                rules of origin for textile and apparel products; and
                    (C) denying appropriate United States officials 
                access to information or documentation relating to 
                production capacity of, and outward processing done by, 
                manufacturers within the country.

SEC. 9. PENALTIES FOR VIOLATIONS OF CUSTOMS LAWS INVOLVING TEXTILE AND 
              APPAREL GOODS.

    (a) Penalties.--Section 592 of the Tariff Act of 1930 (19 U.S.C. 
1592) is amended by adding at the end the following:
    ``(g) Penalties Involving Textile and Apparel Goods.--
            ``(1) Fraud.--Notwithstanding subsection (c), the civil 
        penalty for a fraudulent violation of subsection (a) involving 
        textile and apparel goods--
                    ``(A) shall, subject to subparagraph (B), be double 
                the amount that would otherwise apply under subsection 
                (c)(1); and
                    ``(B) shall be an amount not to exceed 300 percent 
                of the declared value in the United States of the 
                merchandise if the violation has the effect of 
                circumventing any quota on textile and apparel goods.
            ``(2) Gross negligence.--Notwithstanding subsection (c), 
        the civil penalty for a grossly negligent violation of 
        subsection (a) involving textile and apparel goods--
                    ``(A) shall, subject to subparagraphs (B) and (C), 
                be double the amount that would otherwise apply under 
                subsection (c)(2);
                    ``(B) shall, if the violation has the effect of 
                circumventing any quota of the United States on textile 
                and apparel goods, and subject to subparagraph (C), be 
                200 percent of the declared value of the merchandise; 
                and
                    ``(C) shall, if the violation is a third or 
                subsequent offense occurring within 3 years, be the 
                penalty for a fraudulent violation under paragraph (1) 
                (A) or (B), whichever is applicable.
            ``(3) Negligence.--Notwithstanding subsection (c), the 
        civil penalty for a negligent violation of subsection (a) 
        involving textile and apparel goods--
                    ``(A) shall, subject to subparagraphs (B) and (C), 
                be double the amount that would otherwise apply under 
                subsection (a)(3);
                    ``(B) shall, if the violation has the effect of 
                circumventing any quota of the United States on textile 
                and apparel goods, and subject to subparagraph (C), be 
                100 percent of the declared value of the merchandise; 
                and
                    ``(C) shall, if the violation is a third or 
                subsequent offense occurring within 3 years, be the 
                penalty for a grossly negligent violation under 
                paragraph (2) (A) or (B), whichever is applicable.''.
    (b) Mitigation.--Section 618 of the Tariff Act of 1930 (19 U.S.C. 
1618) is amended--
            (1) by striking ``Whenever'' and inserting ``(a) In 
        General.--Whenever'', and
            (2) by adding at the end the following new subsection:
    ``(b) Mitigation Rules Relating to Textile and Apparel Goods.--
            ``(1) General rule.--Notwithstanding any other provision of 
        law, the Secretary of the Treasury may remit or mitigate any 
fine or penalty imposed pursuant to section 592 involving textile or 
apparel goods only if--
                    ``(A) in the case of a first offense, the violation 
                is due to either negligence or gross negligence; and
                    ``(B) in the case of a second or subsequent 
                offense, prior disclosure (as defined in section 
                592(c)(4)) is made within 180 days after the entry of 
                the goods.
            ``(2) Special rule for prior disclosures after 180 days.--
        In the case of a second or subsequent offense where prior 
        disclosure (as defined in section 592(c)(4)) is made after 180 
        days after the entry of the goods, the Secretary of the 
        Treasury may remit or mitigate not more than 50 percent of such 
        fines or penalties.''.
    (c) Seizure and Forfeiture.--Section 596(c)(2) of the Tariff Act of 
1930 (19 U.S.C. 1595a(c)(2)) is amended--
            (1) in subparagraph (E), by striking ``or'' after the 
        semicolon;
            (2) in subparagraph (F), by striking the period and 
        inserting ``; or''; and
            (3) by inserting after subparagraph (F) the following:
                    ``(G) consists of textile or apparel goods 
                introduced into the United States for entry, transit, 
                or exportation, and
                            ``(i) the merchandise or its container 
                        bears false or fraudulent markings with respect 
                        to the country of origin, unless the importer 
                        of the merchandise demonstrates that the 
                        markings were made in order to comply with the 
                        rules of origin of the country that is the 
                        final destination of the merchandise; or
                            ``(ii) the merchandise or its container is 
                        introduced or attempted to be introduced into 
                        the United States by means of, or such 
                        introduction or attempt is aided or facilitated 
                        by means of, a material false statement, act, 
                        or omission with the intention or effect of--
                                    ``(I) circumventing any quota that 
                                applies to the merchandise, or
                                    ``(II) undervaluing the 
                                merchandise.''.
    (d) Certificates of Origin.--Notwithstanding any other provision of 
law, all importations of textile and apparel goods shall be accompanied 
by--
            (1)(A) the name and address of the manufacturer or producer 
        of the goods, and any other information with respect to the 
        manufacturer or producer that the Customs Service may require; 
        and
            (B) if there is more than one manufacturer or producer, or 
        there is a contractor or subcontractor of the manufacturer or 
        producer with respect to the manufacture or production of the 
        goods, the information required under subparagraph (A) with 
        respect to each such manufacturer, producer, contractor, or 
        subcontractor, including a description of the process performed 
        by each such entity;
            (2) a certification by the importer that the importer has 
        exercised reasonable care to ascertain the true country of 
        origin of the textile and apparel goods and the accuracy of all 
        other information provided on the documentation accompanying 
        the imported goods, as well as a certification of the specific 
        action taken by the importer to ensure reasonable care for 
        purposes of this paragraph; and
            (3) a certification by the importer that the goods being 
        entered do not violate applicable trademark, copyright, and 
        patent laws.
Information provided under this subsection shall be sufficient to 
demonstrate compliance with the United States rules of origin for 
textile and apparel goods.

SEC. 10. DIVISION ON TEXTILE ENFORCEMENT.

    (a) Establishment.--The Commissioner of Customs shall, not later 
than 6 months after the date of the enactment of this Act, establish in 
the Customs Service a Division on Textile Enforcement (hereafter in 
this section referred to as the ``DTE''), using existing resources 
available to the Customs Service. The head of the DTE shall be an 
officer of the Customs Service in a position at the level of an 
Assistant Commissioner of Customs.
    (b) Functions.--The DTE shall be responsible for enforcing all laws 
of the United States, and all bilateral and multilateral treaties and 
agreements, governing the importation of textile and apparel goods, 
that the Customs Service is responsible for enforcing.
    (c) Personnel.--The Commissioner of Customs shall assign personnel 
to the DTE who have expertise in textile and apparel goods, including, 
but not limited to, import specialists, investigators, attorneys, 
accountants, laboratory technicians, and members of the textile 
production verification teams.
    (d) Subdivisions.--The DTE shall establish a separate subdivision 
for each geographic region which is a major source of textile and 
apparel goods imported into the United States, including a subdivision 
for each of the following:
            (1) The Far East.
            (2) South Asia.
            (3) South America.
            (4) Central America and the Caribbean.
            (5) The Middle East and Africa.
    (e) Assignments Abroad.--
            (1) To certain countries.--If permitted by the host 
        country, at least 1 customs officer shall be assigned in each 
        country, other than Canada or Mexico, whose annual exports to 
        the United States of textile and apparel goods equal or exceed 
        500,000,000 square meter equivalents. Each such customs officer 
        shall be responsible only for matters relating to exports to 
        the United States of textile and apparel goods.
            (2) Responsibility of secretary of state.--The Secretary of 
        State shall take the necessary steps to facilitate the 
        assignment abroad of customs officers under paragraph (1), by 
        seeking to obtain the approval of the foreign governments 
        concerned for such assignments.
    (f) Reports.--
            (1) Reports by customs officers.--Each customs officer 
        assigned under subsection (e)(1) shall prepare and submit to 
        the Commissioner of Customs, at least monthly, reports 
        summarizing his or her activities, assessing the compliance 
        with applicable textile agreements by the country concerned, 
        and assessing the intellectual property protection provided to 
        textile and apparel goods in that country.
            (2) Reports by dte.--The DTE shall prepare and submit to 
        the Commissioner an annual report--
                    (A) evaluating the extent of circumvention of 
                textile agreements with the United States, the extent 
                of compliance with the rules of origin of the United 
                States relating to textile and apparel goods, the 
                extent to which countries act in compliance with 
                Article XX of the GATT 1994 (as defined in section 2 of 
                the Uruguay Round Agreements Act (19 U.S.C. 3501)) with 
                respect to textile and apparel goods, and the adequacy 
                of intellectual property protection provided to textile 
                and apparel goods; and
                    (B) recommending new methods, if necessary, to 
                address the matters evaluated under subparagraph (A).
            (3) Special report.--Not later than 180 days after the date 
        of enactment of this Act, the DTE shall prepare and submit a 
        report to the Commissioner detailing compliance with the rules 
        of origin for textile and apparel goods entering the United 
        States through the Northern Mariana Islands.
            (4) Availability of reports.--Each report submitted under 
        this subsection shall be made available to appropriate agencies 
        of the executive branch, including the Office of Textiles, 
        Apparel, and Consumer Goods of the Department of Commerce.

SEC. 11. WITHDRAWAL OF UNILATERAL TRADE CONCESSIONS.

    (a) Withdrawal of Concessions.--In any case in which--
            (1) CITA determines that a country--
                    (A) has demonstrated a consistent pattern of 
                circumventing textile agreements with the United 
                States,
                    (B) refuses to cooperate with investigations by the 
                United States of any such alleged circumvention, or
                    (C) fails to provide fair and equitable market 
                access for textile and apparel products of the United 
                States,
            (2) the United States Trade Representative, in consultation 
        with CITA, determines that a country fails to provide adequate 
        enforcement of intellectual property rights with respect to 
        textile and apparel goods, and
            (3) the United States extends to the products of that 
        country preferential tariff or quota treatment other than 
        pursuant to a bilateral or multilateral agreement,
then such preferential treatment shall be withdrawn from the textile 
and apparel goods that are products of that country for such period as 
shall be determined by the Trade Representative, in consultation with 
CITA.
    (b) National Interest Waiver.--The President may waive the 
application of subsection (a) with respect to a country if the 
President determines that the waiver will allow the United States to 
secure effective commitments from that country to prevent future 
circumvention of textile agreements with the United States, or is 
otherwise in the national interest. The President shall publish any 
such waiver, and the reasons for the waiver, in the Federal Register.

SEC. 12. DEFINITIONS.

    As used in this Act:
            (1) Agreement on textiles and clothing.--The term 
        ``Agreement on Textiles and Clothing'' means the Agreement on 
        Textiles and Clothing referred to in section 101(d)(4) of the 
        Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).
            (2) Circumvent and circumvention.--The terms ``circumvent'' 
        and ``circumvention'' refer to a situation in which a country--
                    (A) takes no, or inadequate measures to prevent 
                illegal transshipment of goods that is carried out by 
                rerouting, false declaration concerning country or 
                place of origin, falsification of official documents, 
                evasion of United States rules of origin for textile 
                and apparel goods, or any other means; or
                    (B) takes no or inadequate measures to prevent 
                being used as a transit point for the shipment of goods 
                in violation of an applicable textile agreement.
            (3) CITA.--The term ``CITA'' means the Committee for the 
        Implementation of Textile Agreements established under 
        Executive Order 11651 of March 3, 1972 (7 U.S.C. 1854 note), or 
        any successor entity or officer performing functions of that 
        committee after the date of the enactment of this Act.
            (4) Country.--The term ``country'' includes a separate 
        customs territory, within the meaning of Article XII of the WTO 
        Agreement or other applicable international agreement.
            (5) Customs service.--The term ``Customs Service'' means 
        the United States Customs Service.
            (6) Multifiber arrangement.--The term ``Multifiber 
        Arrangement'' means the Arrangement Regarding International 
        Trade in Textiles referred to in Article 1(3) of the Agreement 
        on Textiles and Clothing.
            (7) Textile agreement; textile agreement with the united 
        states.--The terms ``textile agreement'' and ``textile 
        agreement with the United States'' mean an agreement relating 
        to textile and apparel goods that is negotiated under section 
        204 of the Agricultural Act of 1956 (7 U.S.C. 1854), including 
        the Agreement on Textiles and Clothing.
            (8) Trade representative.--The term ``Trade 
        Representative'' means the United States Trade Representative.
            (9) World trade organization and wto.--The terms ``World 
        Trade Organization'' and ``WTO'' mean the organization 
        established pursuant to the WTO Agreement.
            (10) WTO agreement.--The term ``WTO Agreement'' means the 
        Agreement Establishing the World Trade Organization entered 
        into on April 15, 1994.
            (11) WTO member.--The term ``WTO member'' means a state, or 
        separate customs territory within the meaning of Article XII of 
        the WTO Agreement.

SEC. 13. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall take effect on 
October 1, 1997.
                                 <all>