Short title

This Act may be cited as the

NAFTA Modernization Trade Negotiating Authority Act

Findings

The Congress makes the following findings: (1)Trade among NAFTA members more than tripled from $297,000,000,000 to $930,000,000,000 between 1993 and 2007. United States foreign direct investment in Mexico rose by 259 percent and Mexican foreign direct investment in the United States increased by 244 percent. (2)United States exports to Mexico rose 91 percent from 1994 to 2003, compared to an aggregate of 41 percent to all countries in the world. United States imports from Mexico increased by 179 percent, compared to an aggregate of 89 percent from all countries in the world. (3)The United States International Trade Commission estimated that NAFTA tariff preferences accounted for one-third of United States import growth from Mexico and 13 percent of growth of United States exports to Mexico. (4)The Congressional Budget Office suggested that 85 percent of United States export growth to Mexico and 91 percent of United States import growth from Mexico would have occurred without NAFTA. (5)Despite the aggregate growth in trade and investment, NAFTA’s share of the trade deficit has more than doubled from nearly 8 percent to 20 percent over the past 14 years. This reflects the shift in the United States trade balance with Mexico from a $2,000,000,000 surplus to a $74,000,000,000 deficit. The trade deficit with Canada is now nearly six times what it was in 1993 (an increase from $11,000,000,000 to $65,000,000,000). (6)The trade surplus in services has fallen from $92,000,000,000 in 1997 to $56,000,000,000 in 2005; in advanced technology products, a surplus of $4,500,000,000 in 2001 declined to a deficit of $44,000,000,000 by 2005; and the long-time surplus in agriculture has virtually disappeared. (7)Imported oil is a driving force behind the United States trade deficit, accounting for 57 percent of the deficit in January 2008. (8)Since NAFTA’s inception, the same 2 products (road vehicles and petroleum) have accounted for one-third of United States imports from Mexico and Canada each year. Road vehicles (especially vehicle parts) and machinery have remained the top 2 exports, accounting for one-half of United States exports to Mexico and Canada. (9)Mexico is the leading export destination for several United States agricultural products, including beef, rice, soybean meal, and apples. It is the second leading export market for United States corn, soybeans and oils, and third for pork, poultry, eggs, and cotton. (10)The 5 largest United States export sectors in 2007 were nuclear machinery and appliances, electrical machinery and equipment, automobiles, aircraft, and optical, photographic, and medical equipment. (11)United States exports and imports each saw a marginal growth of 2 percent in 1994. In 2001, the United States experienced an 11 percent marginal growth in exports and 8 percent marginal growth in imports. (12)Net United States employment increased by 24 percent between 1993 and 2007. Since NAFTA went into effect, all 50 States have experienced job growth of at least 12 percent. Contrary to these statistics, the Economic Policy Institute estimates that 500,000 jobs are lost each year due to trade. A study by the Commission argues that NAFTA had a minimal effect on aggregate job growth if any at all. (13)Between 1994 and 2002, more than 500,000 jobs were lost due to NAFTA, many of which were from the manufacturing sector. The Economic Policy Institute estimates that in reality more than 1,000,000 have been lost. (14)Between 1993 and 2006, the value of output in manufacturing increased by 50 percent. However, United States manufacturing’s share of gross domestic product (GDP) declined from 16 percent to 12 percent. (15)The real hourly compensation in the United States business sector rose by 1.5 percent each year between 1993 and 2007. (16)In Mexico, real wages are actually lower and the number of people in poverty has risen from 62,000,000 to 69,000,000 as of 2003. However, most studies attribute lower wages more to the peso crisis of 1994, which caused a 25 percent fall in real wages in Mexico, and other economic factors rather than NAFTA. (17)The United States International Trade Commission suggests that trade in general has contributed to no more than 10 to 20 percent of the rising United States income gap between more-skilled and less-skilled workers. (18)The number of people emigrating illegally from Mexico to the United States is estimated to have doubled since NAFTA went into effect.

Trade Negotiating Objectives

(a)

Overall trade negotiating objectives

The overall trade negotiating objectives of the United States for an agreement subject to the provisions of section 4 are— (1)to obtain more open, equitable, and reciprocal market access; (2)to obtain the reduction or elimination of barriers and distortion that are directly related to trade and that decrease market opportunities for United States exports or otherwise distort United States trade; (3)to further strengthen the system of international trading disciplines and procedures, including dispute settlement; (4)to foster economic growth, raise living standards, and promote full employment in the United States and to enhance the global economy; and (5)to ensure that domestic producers have access to a full range of appropriate legal remedies against unfair trade practices, including adequate and accessible antidumping, countervailing duty, and safeguard mechanisms. (b)

Principal trade negotiating objectives

The principal trade negotiating objectives of the United States for an agreement subject to the provisions of section 4 are as follows: (1)

Trade barriers and distortions

The principal negotiating objectives of the United States regarding trade barriers and other trade distortions are— (A)to expand competitive market opportunities for United States exports and to obtain fairer and more open conditions of trade by reducing or eliminating tariff and nontariff barriers and policies and practices of foreign governments directly related to trade that decrease market opportunities for United States exports or otherwise distort United States trade; and (B)to obtain reciprocal tariff and nontariff barrier elimination. (2)

Trade in services

The principal negotiating objective of the United States regarding trade in services is to reduce or eliminate barriers to international trade in services, including regulatory and other barriers that deny national treatment or unreasonably restrict the establishment or operations of service suppliers. (3)

Foreign investment

The principal negotiating objective of the United States regarding foreign investment is to reduce or eliminate artificial or trade-distorting barriers to trade-related foreign investment by— (A)reducing or eliminating exceptions to the principle of national treatment; (B)freeing the transfer of funds relating to investments; (C)reducing or eliminating performance requirements and other unreasonable barriers to the establishment and operation of investments; (D)seeking to establish standards for expropriation and compensation for expropriation, consistent with United States legal principles and practice; and (E)providing meaningful procedures for resolving investment disputes. (4)

Intellectual property

The principal negotiating objectives of the United States regarding trade-related intellectual property are— (A)to further promote adequate and effective protection of intellectual property rights, including through— (i)(I)ensuring accelerated and full implementation of the Agreement on Trade-Related Aspects of Intellectual Property Rights referred to in section 101(d)(15) of the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(15)), particularly with respect to United States industries whose products are subject to the lengthiest transition periods for full compliance by developing countries with that Agreement; and (II)ensuring that an agreement subject to section 4 provides protection at least as strong as the protection afforded by chapter 17 of the NAFTA and the annexes thereto; (ii)providing strong protection for new and emerging technologies and new methods of transmitting and distributing products embodying intellectual property; (iii)preventing or eliminating discrimination with respect to matters affecting the availability, acquisition, scope, maintenance, use, and enforcement of intellectual property rights; and (iv)providing strong enforcement of intellectual property rights, including through accessible, expeditious, and effective civil, administrative, and criminal enforcement mechanisms; and (B)to secure fair, equitable, and nondiscriminatory market access opportunities for United States persons that rely upon intellectual property protection. (5)

Transparency

The principal negotiating objective of the United States with respect to transparency is to obtain broader application of the principle of transparency through— (A)increased and more timely public access to information regarding trade issues and the activities of international trade institutions; and (B)increased openness of dispute settlement proceedings, including under the World Trade Organization. (6)

Reciprocal trade in agriculture

(A)

In general

The principle negotiating objective of the United States with respect to agriculture is to obtain competitive opportunities for United States exports of agricultural commodities in foreign markets, and to achieve fairer and more open conditions of trade in bulk and value-added commodities by— (i)reducing or eliminating, by a date certain, tariffs or other charges that decrease market opportunities for United States exports, giving priority to those products that are subject to significantly higher tariffs or subsidy regimes of major producing countries; (ii)reducing or eliminating subsidies that decrease market opportunities for United States exports or unfairly distort agriculture markets to the detriment of the United States; (iii)developing, strengthening, and clarifying rules and effective dispute settlement mechanisms to eliminate practices that unfairly decrease market access opportunities for the United States or distort agricultural markets to the detriment of the United States, particularly with respect to import-sensitive agricultural products, including— (I)unfair or trade-distorting activities of State trading enterprises and other administrative mechanisms, with emphasis on requiring price transparency in the operation of State trading enterprises and such other mechanisms; (II)unjustified trade restrictions or commercial requirements affecting new technologies, including biotechnologies; (III)unjustified sanitary or phytosanitary restrictions, including those not based on scientific principles in contravention of the Uruguay Round Agreements; (IV)other unjustified technical barriers to trade; and (V)restrictive rules in the administration of tariff rate quotas; (iv)improving import relief mechanisms to recognize the unique characteristics of perishable and seasonal agricultural products; (v)taking into account whether a party to the negotiations has failed to adhere to the provisions of already existing trade agreements with the United States or has circumvented obligations under those agreements; and (vi)taking into account whether a product is subject to market distortions by reason of a failure to adhere to the provisions of the already existing trade agreements with the United States or by the circumvention by that country of its obligations under those agreements. (B)

Seasonal and perishable commodities

Before commencing negotiations with respect to agriculture, the United States Trade Representative, in consultation with the Congressional Oversight Group convened under section 7, shall seek to develop a position on the treatment of seasonal and perishable agriculture products to be employed in the negotiations in order to develop an international consensus on the treatment of seasonal or perishable agricultural products in investigations relating to dumping, countervailing duties, safeguards, and any other relevant area. (7)

Labor and the environment

The principle negotiating objectives of the United States regarding labor and the environment are the following: (A)To ensure parties to the agreement adopt, maintain, and enforce in their own laws and in practice the following basic internationally recognized labor standards, as stated in the 1998 ILO Declaration on the Fundamental Principles and Rights at Work: (i)Freedom of association. (ii)The effective recognition of the right to collective bargaining. (iii)The elimination of all forms of forced or compulsory labor. (iv)The effective abolition of child labor and a prohibition on the worst forms of child labor. (v)The elimination of discrimination in respect of employment and occupation. (B)(i)To recognize that parties to the agreement retain the right to exercise discretion with respect to investigatory, prosecutorial, regulatory, and compliance matters and to make decisions regarding the allocation of resources to enforcement with respect to other labor or environmental matters determined to have higher priorities. (ii)To recognize that a country is effectively enforcing its laws if a course of action or inaction reflects a reasonable exercise of such discretion, or results from a bona fide decision regarding the allocation of resources. (iii)To provide that a party does not violate its obligations under the agreement— (I)by taking action under clause (i) or clause (ii); or (II)by exercising the right to establish domestic labor standards and levels of environmental protection. (C)To ensure that parties to the agreement cannot derogate from labor obligations in the agreement in a manner affecting trade or investment. (D)To ensure that labor obligations in the agreement are subject to the same dispute settlement, same enforcement mechanisms, and same criteria for selection of enforcement mechanisms as all other obligations under the agreement. (E)To strengthen the capacity of United States trading partners to promote respect for core labor standards. (F)To strengthen the capacity of United States trading partners to protect the environment through the promotion of sustainable development. (G)To reduce or eliminate government practices or policies that unduly threaten sustainable development. (H)To seek market access, through the elimination of tariffs and nontariff barriers, for United States environmental technologies, goods, and services. (I)To ensure that labor, environmental, health, or safety policies and practices of the parties to the agreement do not arbitrarily or unjustifiably discriminate against United States exports or serve as disguised barriers to trade. (J)To ensure that each party to the agreement adopts, implements, and effectively enforces laws, regulations, and all other measures to fulfill that party’s obligations under each of the following multilateral environmental agreements to which they are both parties, subject to existing and future reservations to such agreements: (i)The Convention on International Trade in Endangered Species. (ii)The Montreal Protocol on Ozone Depleting Substances. (iii)The Convention on Marine Pollution. (iv)The Inter-American Tropical Tuna Convention. (v)The Ramsar Convention on the Wetlands. (vi)The International Convention on the Regulation of Whaling. (vii)The Convention on Conservation of Antarctic Marine Living Resources. (K)To ensure that environmental obligations in the agreement are subject to the same dispute settlement, same enforcement mechanisms, and same criteria for selection of enforcement mechanisms as all other obligations under the agreement. (8)

Trade remedy laws

The principle negotiating objectives of the United States with respect to trade remedy laws are— (A)to preserve the ability of the United States to enforce rigorously its trade laws, including the antidumping, countervailing duty, and safeguard laws, and to avoid an agreement that lessens the effectiveness of domestic and international disciplines on unfair trade, especially dumping and subsidies, or that lessens the effectiveness of domestic and international safeguard provisions, in order to ensure that United States workers, agricultural producers, and firms can compete fully on fair terms and enjoy the benefits of reciprocal trade concessions; and (B)to address and remedy market distortions that lead to dumping and subsidization, including overcapacity, cartelization, and market-access barriers. (c)

Special negotiating objectives

(1)

Nafta-country specific objectives

Negotiators negotiating on behalf of the United States shall ensure that any new trade agreement entered into with Canada, Mexico, or both countries meets or exceeds the standards established in the areas of labor and environment, dispute settlement, intellectual property, services, foreign investment, and agriculture of trade agreements negotiated under the Bipartisan Trade Promotion Authority Act of 2002. (2)

Domestic objectives

In pursuing the negotiating objectives under subsections (a), (b) and paragraph (1) of this subsection, the negotiators on behalf of the United States shall take into account United States domestic objectives, including the protection of health and safety, essential security, environmental, consumer, and employment opportunity interests, and the law and regulations related thereto. (3)

Applicability of trade negotiation procedures

Nothing in this subsection shall be construed to authorize the exercise of the trade negotiation procedures under section 4 to modify United States Federal law.

Limited trade negotiating authority for the purposes of modernizing the North American Free Trade Agreement

(a)

North American Free Trade Agreement modernization

(1)

In general

Whenever the President determines that— (A)the reduction or elimination of tariff or nontariff barriers of any foreign country or the United States or any other barrier to, or other distortion of, international trade unduly burdens or restricts the foreign trade of the United States or adversely affects the United States economy, and (B)the imposition of any such barrier or distortion is likely to result in such a burden, restriction, or effect, and that the purposes, policies, priorities, and objectives of this Act will be promoted thereby,

the President may enter into a trade agreement described in paragraph (2) with Canada, Mexico, or both countries during the period described in paragraph (3).

(2)

Trade agreement described

The President may enter into a trade agreement under paragraph (1) with Canada, Mexico, or both countries providing for— (A)the reduction or elimination of a duty, restriction, barrier, or other distortion described in paragraph (1); or (B)the prohibition of, or limitation on the imposition of, such barrier or other distortion. (3)

Time limitation

The President may enter into a trade agreement under this subsection before August 1, 2009. (b)

Conditions

A trade agreement may be entered into under this section only if such agreement makes progress in meeting the applicable objectives described in subsections (a) and (b) of section 3 and the President satisfies the conditions set forth in section 5. (c)

Bills qualifying for trade authorities procedures

(1)

In general

The provisions of section 151 of the Trade Act of 1974 (in this Act referred to as trade authorities procedures) apply to a bill of either House of Congress that contains provisions described in paragraph (2) to the same extent as such section 151 applies to implementing bills under that section. A bill to which this subsection applies shall in this Act be referred to as an implementing bill. (2)

Provisions in implementing bills

The provisions referred to in paragraph (1) are— (A)a provision approving a trade agreement entered into under this section and approving the statement of administrative action, if any, proposed to implement such trade agreement; and (B)if changes in existing laws or new statutory authority are required to implement such trade agreement, provisions, necessary or appropriate to implement such trade agreement, either repealing or amending existing laws or providing new statutory authority. (d)

Commencement of negotiations

In order to contribute to the continued economic expansion of the United States, the President shall commence negotiations under subsection (a) covering tariff and nontariff barriers affecting any industry, product, or service sector. In so doing, the President shall take into account all of the principal negotiating objectives set forth in section 3(b).

Consultations and assessment

(a)

Notice and consultation before negotiation

The President, with respect to any agreement that is subject to the section 4(a), shall— (1)provide, at least 90 calendar days before initiating negotiations, written notice to the Congress of the President’s intention to enter into the negotiations and set forth therein the date the President intends to initiate such negotiations, the specific United States objectives for the negotiations, and whether the President intends to seek an agreement, or changes to an existing agreement; (2)before and after submission of the notice, consult regarding the negotiations with the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives, such other committees of the House and Senate as the President deems appropriate, and the Congressional Oversight group convened under section 7; and (3)upon the request of a majority of the members of the Congressional Oversight Group under section 7(c), meet with the Congressional Oversight Group before initiating the negotiations or at any other time concerning the negotiations. (b)

Negotiations regarding agriculture

(1)

In general

Before initiating negotiations (with respect to an agreement subject to section 4) the subject matter of which directly relates to the subject matter under section 3(b)(6)(A)(i) with any country, the President shall assess whether United States tariffs on agricultural products that were bound under the Uruguay Round Agreements are lower than the tariffs bound by that country. In addition, the President shall consider whether the tariff levels bound and applied throughout the world with respect to imports from the United States are higher than United States tariffs and whether the negotiation provides an opportunity to address any such disparity. The President shall consult with the Committee on Ways and Means and the Committee on Agriculture of the House of Representatives and the Committee on Finance and the Committee on Agriculture, Nutrition, and Forestry of the Senate concerning the results of the assessment, whether it is appropriate for the United States to agree to further tariff reductions based on the conclusions reached in the assessment, and how all applicable negotiating objectives will be met. (2)

Special consultations on import sensitive products

(A)

Before initiating negotiations

Before initiating negotiations (with respect to an agreement subject to section 4) with regard to agriculture, the United States Trade Representative shall— (i)identify those agricultural products subject to tariff-rate quotas on the date of the enactment of this Act, and agricultural products subject to tariff reductions by the United States as a result of the Uruguay Round Agreements, for which the rate of duty was reduced on January 1, 1995, to a rate that was not less than 97.5 percent of the rate of duty that applied to such article on December 31, 1994; (ii)consult with the Committee on Ways and Means and the Committee on Agriculture of the House of Representatives and the Committee on Finance and the Committee on Agriculture, Nutrition, and Forestry of the Senate concerning— (I)whether any further tariff reductions on the products identified under clause (i) should be appropriate, taking into account the impact of any such tariff reduction on the United States industry producing the product concerned; (II)whether the products so identified face unjustified sanitary or phytosanitary restrictions, including those not based on scientific principles in contravention of the Uruguay Round Agreements; and (III)whether the countries participating in the negotiations maintain export subsidies or other programs, policies, or practices that distort world trade in such products and the impact of such programs, policies, and practices on United States producers of the products; (iii)request that the Commission prepare an assessment of the probable economic effects of any such tariff reduction on the United States industry producing the product concerned and on the United States economy as a whole; and (iv)upon complying with clauses (i), (ii), and (iii), notify the Committee on Ways and Means and the Committee on Agriculture of the House of Representatives and the Committee on Finance and the Committee on Agriculture, Nutrition, and Forestry of the Senate of those products identified under clause (i) for which the Trade Representative intends to seek tariff liberalization in the negotiations and the reasons for seeking such tariff liberalization. (B)

After negotiations commenced

If, after negotiations described in subparagraph (A) are commenced— (i)the United States Trade Representative identifies any additional agricultural product described in subparagraph (A)(i) for tariff reductions that were not the subject of a notification under subparagraph (A)(iv), or (ii)any additional agricultural product described in subparagraph (A)(i) is the subject of a request for tariff reductions by a party to the negotiations,

the Trade Representative shall, as soon as practicable, notify the committees referred to in subparagraph (A)(iv) of those products and the reasons for seeking such tariff reductions.

(3)

Negotiations regarding the fishing industry

Before initiating negotiations (with respect to an agreement subject to section 4) the subject matter of which relates directly to fish or shellfish trade, the President shall consult with the Committee on Ways and Means and the Committee on Resources of the House of Representatives, and the Committee on Finance and the Committee on Commerce, Science, and Transportation of the Senate, and shall keep the Committees apprised of the negotiations on an ongoing and timely basis. (c)

Negotiations regarding textiles

Before initiating negotiations with a country (with respect to an agreement subject to section 4) the subject matter of which relates directly to textiles and apparel products, the President shall assess whether United States tariffs on textile and apparel products that were bound under the Uruguay Round Agreements are lower than the tariffs bound by that country and whether the negotiation provides an opportunity to address any such disparity. The President shall consult with the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate concerning the results of the assessment, whether it is appropriate for the United States to agree to further tariff reductions based on the conclusions reached in the assessment, and how all applicable negotiating objectives will be met. (d)

Consultation with congress before agreement entered into

(1)

Consultation

Before entering into a trade agreement under section 4(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; (B)each other committee of the House and the Senate, and each joint committee of the Congress, that has jurisdiction over legislation involving subject matters that would be affected by the trade agreement; and (C)the Congressional Oversight Group convened under section 7. (2)

Scope

The consultation described in paragraph (1) shall include consultation with respect to— (A)the nature of the agreement; (B)how and to what extent the agreement will achieve the applicable purposes, policies, priorities, and objectives of this Act; and (C)the implementation of the agreement under section 6, including the general effect of the agreement on existing laws. (3)

Report regarding united states trade remedy laws

The President, at least 180 calendar days before the day on which the President enters into a trade agreement under section 4(a), shall report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate— (A)the range of proposals advanced in the negotiations with respect to that agreement, that may be in the final agreement, and that could require amendments to title VII of the Tariff Act of 1930 or to chapter 1 of title II of the Trade Act of 1974; and (B)how these proposals relate to the objectives described in section 3(b)(8). (e)

Advisory committee reports

The report required under section 135(e)(1) of the Trade Act of 1974 regarding any trade agreement entered into under section 4(a) of this Act shall be provided to the President, the Congress, and the United States Trade Representative not later than 30 days after the date on which the President notifies the Congress under section 6(a)(1)(A) of the President’s intention to enter into the agreement. (f)

ITC assessment

(1)

In general

The President, at least 90 calendar days before the day on which the President enters into a trade agreement under section 4(a), shall provide the Commission with the details of the agreement as it exists at that time and request the Commission to prepare and submit an assessment of the agreement as described in paragraph (2). Between the time the President makes the request under this paragraph and the time the Commission submits the assessment, the President shall keep the Commission current with respect to the details of the agreement. (2)

ITC assessment

Not later than 90 calendar days after the President enters into the agreement, the Commission shall submit to the President and the Congress a report assessing the likely impact of the agreement on the United States economy as a whole and on specific industry sectors, including the impact the agreement will have on the gross domestic product, exports and imports, aggregate employment and employment opportunities, the production, employment, and competitive position of industries likely to be significantly affected by the agreement, and the interests of United States consumers. (3)

Review of empirical literature

In preparing the assessment, the Commission shall review available economic assessments regarding the agreement, including literature regarding any substantially equivalent proposed agreement, and shall provide in its assessment a description of the analyses used and conclusions drawn in such literature, and a discussion of areas of consensus and divergence between the various analyses and conclusions, including those of the Commission regarding the agreement.

Implementation of trade agreement

(a)

In general

(1)

Notification and submission

Any agreement entered into under section 4(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 the President enters into the trade agreement, notifies the House of Representatives and the Senate of the President’s intention to enter into the agreement, and promptly thereafter publishes notice of such intention in the Federal Register; (B)within 60 days after entering into the agreement, the President submits to the Congress a description of those changes to existing laws that the President considers would be required in order to bring the United States into compliance with the agreement; (C)after entering into the agreement, the President submits to the Congress, on a day on which both Houses of Congress are in session, a copy of the final legal text of the agreement, together with— (i)a draft of an implementing bill described in section 4(c); (ii)a statement of any administrative action proposed to implement the trade agreement; and (iii)the supporting information described in paragraph (2); and (D)the implementing bill is enacted into law. (2)

Supporting information

The supporting information required under paragraph (1)(C)(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 applicable purposes, policies, priorities, and objectives of this Act; and (ii)setting forth the reasons of the President regarding— (I)how and to what extent the agreement makes progress in achieving the applicable purposes, policies, and objectives referred to in clause (i); (II)whether and how the agreement changes provisions of an agreement previously negotiated; (III)how the agreement serves the interests of United States commerce; (IV)how the implementing bill meets the standards set forth in section 4(c); and (V)how and to what extent the agreement makes progress in achieving the applicable purposes, policies, and objectives referred to in section 3(c) regarding the promotion of certain priorities. (3)

Reciprocal benefits

In order to ensure that a foreign country that is not a party to a trade agreement entered into under section 4(a) does not receive benefits under the agreement unless the country is also subject to the obligations under the agreement, the implementing bill submitted with respect to the agreement shall provide that the benefits and obligations under the agreement apply only to the parties to the agreement, if such application is consistent with the terms of the agreement. The implementing bill may also provide that the benefits and obligations under the agreement do not apply uniformly to all parties to the agreement, if such application is consistent with the terms of the agreement. (4)

Disclosure of commitments

Any agreement or other understanding with a foreign government or governments (whether oral or in writing) that— (A)relates to a trade agreement with respect to which the Congress enacts an implementing bill under trade authorities procedures, and (B)is not disclosed to the Congress before an implementing bill with respect to that agreement is introduced in either House of Congress,

shall not be considered to be part of the agreement approved by the Congress and shall have no force or effect under United States law or in any dispute settlement body.

(b)

Limitations on trade authorities procedures

(1)

For lack of notice or consultations

(A)

In general

The trade authorities procedures shall not apply to any implementing bill submitted with respect to a trade agreement entered into under section 4(a) if during the 60-day period beginning on the date that one House of Congress agrees to a procedural disapproval resolution for lack of notice or consultations with respect to such trade agreement, the other House separately agrees to a procedural disapproval resolution with respect to such trade agreement. (B)

Procedural disapproval resolution

(i)For purposes of this paragraph, the term procedural disapproval resolution means a resolution of either House of Congress, the sole matter after the resolving clause of which is as follows: That the President has failed or refused to notify or consult in accordance with the NAFTA Modernization Trade Promotion Authority Act on negotiations with respect to ______ and, therefore, the trade authorities procedures under that Act shall not apply to any implementing bill submitted with respect to such trade agreement or agreements., with the blank space being filled with a description of the trade agreement with respect to which the President is considered to have failed or refused to notify or consult. (ii)For purposes of clause (i), the President has failed or refused to notify or consult in accordance with the NAFTA Modernization Trade Promotion Authority Act on negotiations with respect to a trade agreement if— (I)the President has failed or refused to consult (as the case may be) in accordance with section 5 or this section with respect to the negotiations or agreement; (II)guidelines under section 7(b) have not been developed or met with respect to the negotiations or agreement; (III)the President has not met with the Congressional Oversight Group pursuant to a request made under section 7(c) with respect to the negotiations or agreement; or (IV)the agreement fails to make progress in achieving the purposes, policies, priorities, and objectives of this Act. (2)

Procedures for considering resolutions

(A)Procedural disapproval resolutions— (i)in the House of Representatives— (I)may be introduced by any Member of the House; (II)shall be referred to the Committee on Ways and Means and, in addition, to the Committee on Rules; and (III)may not be amended by either Committee; and (ii)in the Senate— (I)may be introduced by any Member of the Senate; (II)shall be referred to the Committee on Finance; and (III)may not be amended. (B)The provisions of section 152(d) and (e) of the Trade Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating to the floor consideration of certain resolutions in the House and Senate) apply to a procedural disapproval resolution introduced with respect to a trade agreement if no other procedural disapproval resolution with respect to that trade agreement has previously been reported in that House of Congress by the Committee on Ways and Means or the Committee on Finance, as the case may be. (C)It is not in order for the House of Representatives to consider any procedural disapproval resolution not reported by the Committee on Ways and Means and, in addition, by the Committee on Rules. (D)It is not in order for the Senate to consider any procedural disapproval resolution not reported by the Committee on Finance. (c)

Rules of house of representatives and senate

Subsection (b) is enacted by the Congress— (1)as an exercise of the rulemaking power of the House of Representatives and the Senate, respectively, and as such are deemed a part of the rules of each House, respectively, and such procedures supersede other rules only to the extent that they are inconsistent with such other rules; and (2)with the full recognition of the constitutional right of either House to change the rules (so far as relating to the procedures of that House) at any time, in the same manner, and to the same extent as any other rule of that House.

Congressional oversight group

(a)

Members and functions

(1)

In general

By not later than 60 days after the date of the enactment of this Act, and not later than 30 days after the convening of each Congress, the chairman of the Committee on Ways and Means of the House of Representatives and the chairman of the Committee on Finance of the Senate shall convene the Congressional Oversight Group. (2)

Membership from the house

In each Congress, the Congressional Oversight Group shall be comprised of the following Members of the House of Representatives: (A)The chairman and ranking member of the Committee on Ways and Means, and 3 additional members of such Committee (not more than 2 of whom are members of the same political party). (B)The chairman and ranking member, or their designees, of the committees of the House of Representatives that would have, under the Rules of the House of Representatives, jurisdiction over provisions of law affected by a trade agreement negotiations for which are conducted at any time during that Congress and to which this Act would apply. (3)

Membership from the senate

In each Congress, the Congressional Oversight Group shall also be comprised of the following members of the Senate: (A)The chairman and ranking member of the Committee on Finance and 3 additional members of such Committee (not more than 2 of whom are members of the same political party). (B)The chairman and ranking member, or their designees, of the committees of the Senate that would have, under the Rules of the Senate, jurisdiction over provisions of law affected by a trade agreement negotiations for which are conducted at any time during that Congress and to which this Act would apply. (4)

Accreditation

Each member of the Congressional Oversight Group described in paragraph (2)(A) and (3)(A) shall be accredited by the United States Trade Representative on behalf of the President as an official adviser to the United States delegation in negotiations for any trade agreement to which this Act applies. Each member of the Congressional Oversight Group described in paragraph (2)(B) and (3)(B) shall be accredited by the United States Trade Representative on behalf of the President as an official adviser to the United States delegation in the negotiations by reason of which the member is in the Congressional Oversight Group. The Congressional Oversight Group shall consult with and provide advice to the Trade Representative regarding the formulation of specific objectives, negotiating strategies and positions, the development of the applicable trade agreement, and compliance and enforcement of the negotiated commitments under the trade agreement. (5)

Chair

The Congressional Oversight Group shall be chaired by the Chairman of the Committee on Ways and Means of the House of Representatives and the Chairman of the Committee on Finance of the Senate. (b)

Guidelines

(1)

Purpose and revision

The United States Trade Representative, in consultation with the chairmen and ranking minority members of the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate— (A)shall, within 120 days after the date of the enactment of this Act, develop written guidelines to facilitate the useful and timely exchange of information between the Trade Representative and the Congressional Oversight Group convened under this section; and (B)may make such revisions to the guidelines as may be necessary from time to time. (2)

Content

The guidelines developed under paragraph (1) shall provide for, among other things— (A)regular, detailed briefings of the Congressional Oversight Group regarding negotiating objectives, including the promotion of certain priorities referred to in section 3(c), and positions and the status of the applicable negotiations, beginning as soon as practicable after the Congressional Oversight Group is convened, with more frequent briefings as trade negotiations enter the final stage; (B)access by members of the Congressional Oversight Group, and staff with proper security clearances, to pertinent documents relating to the negotiations, including classified materials; (C)the closest practicable coordination between the Trade Representative and the Congressional Oversight Group at all critical periods during the negotiations, including at negotiation sites; and (D)after the applicable trade agreement is concluded, consultation regarding ongoing compliance and enforcement of negotiated commitments under the trade agreement. (c)

Request for meeting

Upon the request of a majority of the Congressional Oversight Group, the President shall meet with the Congressional Oversight Group before initiating negotiations with respect to a trade agreement under this Act, or at any other time concerning the negotiations.

Additional implementation and enforcement requirements

(a)

In general

At the time the President submits to the Congress the final text of a trade agreement pursuant to section 6(a)(1)(C), the President shall also submit a plan for implementing and enforcing the agreement. The implementation and enforcement plan shall include the following: (1)

Border personnel requirements

A description of additional personnel required at border entry points, including a list of additional customs and agricultural inspectors. (2)

Agency staffing requirements

A description of additional personnel required by Federal agencies responsible for monitoring and implementing the agreement, including personnel required by the Office of the United States Trade Representative, the Department of Commerce, the Department of Agriculture (including additional personnel required to implement sanitary and phytosanitary measures in order to obtain market access for United States exports), the Department of the Treasury, and such other agencies as may be necessary. (3)

Customs infrastructure requirements

A description of the additional equipment and facilities needed by U.S. Customs and Border Protection. (4)

Impact on state and local governments

A description of the impact the agreement will have on State and local governments as a result of increases in trade. (5)

Cost analysis

An analysis of the costs associated with each of the items listed in paragraphs (1) through (4). (b)

Budget submission

The President shall include a request for the resources necessary to support the plan described in subsection (a) in the first budget that the President submits to the Congress after the submission of the plan.

Conforming amendments

(a)

In general

Title I of the Trade Act of 1974 (19 U.S.C. 2111 et seq.) is amended as follows: (1)

Implementing bill

(A)Section 151(b)(1) (19 U.S.C. 2191(b)(1)) is amended by striking or section 2105(a)(1) of the Bipartisan Trade Promotion Authority Act of 2002 and inserting section 2105(a)(1) of the Bipartisan Trade Promotion Authority Act of 2002, or section 6(a)(1) of the NAFTA Modernization Trade Promotion Authority Act. (B)Section 151(c)(1) (19 U.S.C. 2191(c)(1)) is amended by striking or section 2105(a)(1) of the Bipartisan Trade Promotion Authority Act of 2002 and inserting section 2105(a)(1) of the Bipartisan Trade Promotion Authority Act of 2002, or section 6(a)(1) of the NAFTA Modernization Trade Promotion Authority Act. (2)

Advice from international trade commission

Section 131 (19 U.S.C. 2151) is amended— (A)in subsection (a)— (i)in paragraph (1), by striking or section 2103(a) or (b) of the Bipartisan Trade Promotion Authority Act of 2002, and inserting , section 2103(a) or (b) of the Bipartisan Trade Promotion Authority Act of 2002, or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act,; and (ii)in paragraph (2), by inserting or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act after Act of 2002; and (B)in subsection (c), by striking or section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, and inserting , section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act,. (3)

Hearings and advice

Sections 132, 133(a), and 134(a) (19 U.S.C. 2152, 2153(a), and 2154(a)) are each amended by striking or section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, each place it appears and inserting , section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act,. (4)

Prerequisites for offers

Section 134(b) (19 U.S.C. 2154(b)) is amended by inserting or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act after Act of 2002. (5)

Advice from private and public sectors

Section 135 (19 U.S.C. 2155) is amended— (A)in subsection (a)(1)(A), by striking or section 2103 of the Bipartisan Trade Promotion Authority Act of 2002 and inserting , section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act; (B)in subsection (e)(1)— (i)in the first sentence, by inserting or section 4(a) of the NAFTA Modernization Trade Promotion Authority Act after Act of 2002; and (ii)by adding at the end the following new sentence: Each report that applies to a trade agreement entered into under section 4(a) of the NAFTA Modernization Trade Promotion Authority Act shall be provided under the first sentence not later than the date on which the President notifies the Congress under section 6(a)(1)(A) of that Act of his intention to enter into that agreement.; and (C)in subsection (e)(2), by inserting or section 3 of the NAFTA Modernization Trade Promotion Authority Act of 2002 after Act of 2002. (6)

Transmission of agreement to congress

Section 162(a) (19 U.S.C. 2212(a)) is amended by striking or under section 2103 of the Bipartisan Trade Promotion Authority Act of 2002 and inserting , under section 2103 of the Bipartisan Trade Promotion Authority Act of 2002, or under section 4(a) of the NAFTA Modernization Trade Promotion Authority Act. (b)

Application of certain provisions

For purposes of applying sections 125, 126, and 127 of the Trade Act of 1974 (19 U.S.C. 2135, 2136(a), and 2137)— (1)any trade agreement entered into under section 4(a) shall be treated as an agreement entered into under section 101 or 102, as appropriate, of the Trade Act of 1974 (19 U.S.C. 2111 or 2112); and (2)any proclamation or Executive order issued pursuant to a trade agreement entered into under section 4(a) shall be treated as a proclamation or Executive order issued pursuant to a trade agreement entered into under section 102 of the Trade Act of 1974.

10.

Definitions

In this Act: (1)

Commission

The term Commission means the United States International Trade Commission. (2)

Core labor standards

The term core labor standards means— (A)the right of association; (B)the right to organize and bargain collectively; (C)a prohibition on the use of any form of forced or compulsory labor; (D)a minimum age for the employment of children; and (E)acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health. (3)

ILO

The term ILO means the International Labor Organization. (4)

NAFTA

The term NAFTA means the North American Free Trade Agreement. (5)

NAFTA members

The term NAFTA members means the United States, Canada, and Mexico. (6)

United states person

The term United States person means— (A)a United States citizen; (B)a partnership, corporation, or other legal entity organized under the laws of the United States; and (C)a partnership, corporation, or other legal entity that is organized under the laws of a foreign country and is controlled by entities described in subparagraph (B) or United States citizens, or both. (7)

Uruguay round agreements

The term Uruguay Round Agreements has the meaning given that term in section 2(7) of the Uruguay Round Agreements Act (19 U.S.C. 3501(7)). (8)

World trade organization

The term World Trade Organization means the organization established pursuant to the WTO Agreement. (9)

WTO agreement

The term WTO Agreement means the Agreement Establishing the World Trade Organization entered into on April 15, 1994.