[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 3198 Introduced in Senate (IS)]

<DOC>






118th CONGRESS
  1st Session
                                S. 3198

 To amend the Internal Revenue Code of 1986 to impose a fee on certain 
    products imported into the United States based on the pollution 
  intensity associated with the production of such products, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            November 2, 2023

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

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to impose a fee on certain 
    products imported into the United States based on the pollution 
  intensity associated with the production of such products, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Foreign Pollution Fee Act of 2023''.

SEC. 2. SENSE OF CONGRESS; PURPOSE.

    (a) Sense of Congress.--It is the sense of Congress that--
            (1) it is in the interests of the United States to strive 
        for environmental protection in order to protect human health;
            (2) the nature of environmental challenges are 
        transnational in nature, but international cooperative efforts, 
        including those led by the United States, have not resulted in 
        many trading partners adopting measures to address those 
        challenges;
            (3) the transnational issues related to environmental 
        protection and pollution impact the environment and public 
        health in the United States and in turn present national 
        security risks because of the environmental and public health 
        risks;
            (4) the United States--
                    (A) has adopted many environmental protections, 
                including the Clean Air Act (42 U.S.C. 7401 et seq.), 
                the Federal Water Pollution Control Act (33 U.S.C. 1251 
                et seq.), the Toxic Substances Control Act (15 U.S.C. 
                2601 et seq.), and more than 15 other major 
                environmental protection laws that--
                            (i) add costs to the production of goods in 
                        order to secure the benefits of environmental 
                        protection and conservation efforts; and
                            (ii) serve to meaningfully decrease 
                        greenhouse gasses such as carbon dioxide 
                        (CO<INF>2</INF>), methane (CH<INF>4</INF>), 
                        nitrous oxide (N<INF>2</INF>O), sulfur 
                        hexafluoride (SF<INF>6</INF>), 
                        hydrofluorocarbons (HFCs), perfluorocarbons 
                        (PFCs), and other fluorinated greenhouse gases;
                    (B) is the world's largest consumer market and its 
                economy is highly integrated into the world; and
                    (C) bears responsibility to ensure that the United 
                States market does not incentivize forum shopping for 
                the production of goods to jurisdictions with low 
                environmental standards to obtain a competitive cost 
                advantage while undermining efforts to address 
                transnational environmental and resource challenges as 
                well as global public health;
            (5) it is necessary to apply measures to ensure the 
        environmental conservation efforts of the United States are not 
        frustrated through such forum shopping; and
            (6) the development needs of low-income and lower-middle-
        income countries must be reasonably taken into consideration 
        while strengthening environmental protection.
    (b) Purpose.--It is the purpose of this Act to raise global 
environmental performance to ensure a healthy environment and secure 
global public health benefits.

SEC. 3. RULES OF CONSTRUCTION.

    (a) Domestic Production.--Nothing in this Act, or any amendments 
made by this Act, shall be construed to authorize the creation of any 
carbon tax, fee, pricing, or other mechanism that imposes additional 
costs to any covered product (as defined in section 4695(a) of the 
Internal Revenue Code of 1986, as added by this Act) which is produced 
domestically and sold, used, further refined, or distributed within 
United States or exported to another country for sale or use.
    (b) Application to Other Laws.--Nothing in this Act, or any 
amendments made by this Act, shall be construed to authorize new 
environmental standards of performance or impact calculations of 
compliance to standards under the Clean Air Act (42 U.S.C. 7401 et 
seq.) or any other Act which examines the environmental impact of 
domestic production or proposed production.
    (c) Data Collection.--Except as expressly authorized under this 
Act, nothing in this Act, or any amendments made by this Act, shall be 
construed to authorize additional authority for any agency to collect 
additional pollution data from a domestic producer.

                     TITLE I--FOREIGN POLLUTION FEE

SEC. 101. FOREIGN POLLUTION FEE.

    (a) In General.--Chapter 38 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new subchapter:

                 ``Subchapter E--Foreign Pollution Fee

``Sec. 4691. Imposition of foreign pollution fee.
``Sec. 4692. Determination of variable charge.
``Sec. 4693. Calculation of pollution intensity.
``Sec. 4694. Treatment of international partnerships.
``Sec. 4695. Covered products.
``Sec. 4696. National Laboratory Advisory Board on Global Pollution 
                            Challenges.
``Sec. 4697. Definitions.
``Sec. 4698. Establishment process and reassessments.

``SEC. 4691. IMPOSITION OF FOREIGN POLLUTION FEE.

    ``(a) In General.--
            ``(1) Imposition of fee.--In the case of any covered 
        product which is imported by a covered entity into the United 
        States after the applicable date, there is hereby imposed a fee 
        upon entry or importation of such covered product in an amount 
        equal to the product of--
                    ``(A) the amount of such covered product which is 
                imported into the United States, and
                    ``(B) the variable charge (as determined under 
                section 4692).
            ``(2) Applicable date.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the applicable date shall be the date which is 36 
                months after the date of enactment of this subchapter.
                    ``(B) Postponement.--With respect to any covered 
                product produced in a low-income country or lower-
                middle-income country, the Secretary may extend the 
                applicable date under such clause for a period of not 
                greater than 12 months if the United States Trade 
                Representative issues a certification to the 
                appropriate congressional committees that such country 
                is making progress towards an international partnership 
                agreement.
    ``(b) Fee Due.--
            ``(1) In general.--The fee imposed under this section with 
        respect to any covered product shall be paid by the covered 
        entity which imported such product at the same time, and 
        through the same electronic portal, that any payment of custom 
        duties are made.
            ``(2) Security for fees.--The Secretary may issue such 
        regulations or other guidance to require, or may direct 
        officers of U.S. Customs and Border Protection to require, a 
        covered entity to file with the Secretary a bond or other 
        security in such amount and with such conditions as the 
        Secretary determines necessary to ensure payment of the fees 
        imposed under this section.
    ``(c) Measurement of Imported Products.--The amount of any covered 
product which is imported into the United States shall be determined by 
the measure ordinarily used in the course of trade of such covered 
product (as determined pursuant to the 6-digit HTS subheading number 
with respect to such product).
    ``(d) Amounts and Fees.--The Commissioner of U.S. Customs and 
Border Protection shall allow payment of the fee imposed under this 
section for such product to be paid by the covered entity in the same 
manner in which payment of custom duties are made.

``SEC. 4692. DETERMINATION OF VARIABLE CHARGE.

    ``(a) In General.--The variable charge is an ad valorem fee which 
is specific to a covered product and determined pursuant to the tier to 
which such covered product is assigned.
    ``(b) Tiers.--
            ``(1) In general.--Tiers for covered products shall be 
        established as follows:
                    ``(A) For covered products for which the pollution 
                intensity difference is greater than 10 percent and not 
                greater than 50 percent, tiers shall be established at 
                each 5-percentage-point increment.
                    ``(B) For covered products for which the pollution 
                intensity difference is greater than 50 percent and not 
                greater than 200 percent, tiers shall be established at 
                each 10-percentage-point increment.
                    ``(C) For covered products for which the pollution 
                intensity difference is greater than 200 percent, tiers 
                shall be established at each 20-percentage-point 
                increment.
            ``(2) Application of tiers.--
                    ``(A) In general.--The purposes of the tiers under 
                this section are as follows:
                            ``(i) To provide for a standardized 
                        organization model for each covered product to 
                        allow for proper implementation and application 
                        of the fee imposed under section 4691, with 
                        such tiers to be based on the different 
                        pollution intensities for a given covered 
                        product based on the country of origin of such 
                        covered product (or, subject to section 204 of 
                        the Foreign Pollution Fee Act of 2023, the 
                        manufacturer of such covered product).
                            ``(ii) To allow for determinations of the 
                        variable charge under this section in relation 
                        to the tiers in a manner which is specific to 
                        the covered product.
                    ``(B) Use of tiers in determining variable 
                charge.--
                            ``(i) In general.--In accordance with 
                        paragraph (1), tiers shall be established for 
                        each covered product, with the variable charge 
                        assigned to each tier in a manner which is 
                        consistent with achieving the goals described 
                        in subsection (c)(2) with respect to such 
                        covered product.
                            ``(ii) Prohibition.--The variable charge 
                        assigned to a particular tier for a covered 
                        product shall not be used to determine the 
                        variable charge assigned to the same tier for a 
                        different covered product.
            ``(3) Assignment.--Each covered product shall be assigned 
        to the applicable tier which corresponds to the pollution 
        intensity difference with respect to such covered product.
    ``(c) Variable Charge.--
            ``(1) In general.--The variable charge assigned to each 
        tier for a covered product shall be specific to the achievement 
        of the goals in paragraph (2).
            ``(2) Goals.--
                    ``(A) Phase one goals.--During the 6-year period 
                beginning after the applicable date described in 
                section 4691(a)(2) (or, in the case of any covered 
                product added pursuant to subsection (d) or (e) of 
                section 4695, the 6-year period subsequent to the date 
                described in subsection (f) of such section), the goal 
                utilized for establishment of the variable charge with 
                respect to any covered product shall be--
                            ``(i) in the case of any covered product 
                        for which the average pollution intensity 
                        difference is greater than 50 percent, to alter 
                        trade flows such that the average pollution 
                        intensity difference associated with such 
                        covered product is not greater than 50 percent,
                            ``(ii) in the case of any covered product 
                        for which the average pollution intensity 
                        difference is greater than 25 percent and not 
                        greater than 50 percent, to alter trade flows 
                        such that the average pollution intensity 
                        difference associated with such covered product 
                        is not greater than 25 percent, and
                            ``(iii) in the case of any covered product 
                        for which the average pollution intensity 
                        difference is not greater than 25 percent, to 
                        alter trade flows such that the average 
                        pollution intensity difference associated with 
                        such covered product is not greater than 10 
                        percent.
                    ``(B) Phase two goals.--During the 6-year period 
                subsequent to the initial 6-year period described in 
                subparagraph (A), the goal for establishment of the 
                variable charge with respect to any covered product 
                shall be--
                            ``(i) in the case of any covered product 
                        which, for the initial 6-year period described 
                        in such subparagraph, was described in clause 
                        (i) of such subparagraph, to alter trade flows 
                        such that the average pollution intensity 
                        difference associated with such covered product 
                        is not greater than 25 percent,
                            ``(ii) in the case of any covered product 
                        which, for the initial 6-year period described 
                        in such subparagraph, was described in clause 
                        (ii) of such subparagraph, to alter trade flows 
                        such that the average pollution intensity 
                        difference associated with such covered product 
                        is not greater than 10 percent, and
                            ``(iii) in the case of any covered product 
                        which, for the initial 6-year period described 
                        in such subparagraph, was described in clause 
                        (iii) of such subparagraph, to maintain 
                        achievement of the goal described in such 
                        clause.
                    ``(C) Phase three goals.--For any year subsequent 
                to the period described in subparagraph (B), the goal 
                for establishment of the variable charge with respect 
                to any covered product shall be to alter trade flows 
                such that the average pollution intensity difference 
                associated with such covered product is not greater 
                than 10 percent.
            ``(3) Progression of variable charge.--
                    ``(A) In general.--To the maximum extent 
                practicable, the variable charges assigned to each tier 
                of a covered product to achieve the goals described in 
                paragraph (2) shall progress through each tier in a 
                manner consistent with an increasing linear 
                interpolation of the variable charge.
                    ``(B) Exception.--With respect to any tier for a 
                covered product and the variable charge assigned to 
                such tier, the Board may recommend and the Secretary 
                may finalize a variable charge that deviates from a 
                linear interpolation of the variable charge as 
                described in subparagraph (A), provided that such 
                alteration allows for a higher likelihood that the 
                goals described in paragraph (2) will be attained.
            ``(4) Minimization of domestic cost increases.--For 
        purposes of this subsection, any variable charge shall be 
        established in a manner which ensures that the goals described 
        under paragraph (2) are attained while minimizing any potential 
        increase in domestic costs.
    ``(d) Exceptions.--
            ``(1) Comparable to baseline pollution intensity.--In the 
        case of any covered product for which the pollution intensity 
        difference is not greater than 10 percent, the variable charge 
        shall be zero.
            ``(2) Insufficient domestic production.--
                    ``(A) In general.--In the case of any covered 
                product for which the Secretary determines there is not 
                sufficient domestic production with respect to such 
                product, the variable charge shall be zero.
                    ``(B) Definition.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the term `sufficient domestic 
                        production' means any covered product for which 
                        an equivalent product which is produced by 
                        domestic producers within the United States 
                        constitutes greater than the applicable 
                        percentage of domestic consumption of such 
                        product.
                            ``(ii) Applicable percentage.--
                                    ``(I) In general.--For purposes of 
                                clause (i), the applicable percentage 
                                shall be equal to--
                                            ``(aa) 5 percent, or
                                            ``(bb) in the case of any 
                                        covered product described in 
                                        subclause (II), such percentage 
                                        below 5 percent as is 
                                        determined appropriate by the 
                                        Secretary.
                                    ``(II) Specified product.--A 
                                covered product described in this 
                                subclause is a product--
                                            ``(aa) which the Secretary, 
                                        in consultation with the United 
                                        States Trade Representative, 
                                        has determined requires an 
                                        applicable percentage below 5 
                                        percent for purposes of 
                                        supporting--

                                                    ``(AA) national 
                                                security,

                                                    ``(BB) prevention 
                                                of dumping from foreign 
                                                countries, or

                                                    ``(CC) development 
                                                of a domestic industry, 
                                                or

                                            ``(bb) for which, as a 
                                        result of an international 
                                        partnership agreement, a 
                                        country which is a party to 
                                        such agreement produces not 
                                        less than 5 percent of United 
                                        States domestic consumption of 
                                        such covered product.
                    ``(C) Adjustment.--In the case of any covered 
                product for which no variable charge is imposed under 
                this section pursuant to a determination under 
                subparagraph (A), the Secretary shall--
                            ``(i) review such determination not less 
                        than annually, and
                            ``(ii) if the Secretary's review determines 
                        that sufficient domestic production has been 
                        attained with respect to such product, 
                        terminate application of subparagraph (A) for 
                        such product.
                    ``(D) Exception.--This paragraph shall not apply 
                with respect to any product which is included as a 
                covered product pursuant to section 4695(d).
            ``(3) National security.--
                    ``(A) Product waiver.--
                            ``(i) In general.--The Secretary, in 
                        coordination with the Secretary of Defense and 
                        the Commissioner of U.S. Customs and Border 
                        Protection, may reduce the variable charge to 
                        zero for any covered product if the Secretary 
                        determines that such product is imported for 
                        purposes of fulfilling a contract with--
                                    ``(I) the Department of Defense, or
                                    ``(II) any contractor of the 
                                Department of Defense.
                            ``(ii) Form.--
                                    ``(I) In general.--Any reduction 
                                under this subparagraph shall only 
                                apply to a covered product--
                                            ``(aa) for the period that 
                                        the contract described in 
                                        clause (i) is in effect, and
                                            ``(bb) with respect to the 
                                        quantity of such covered 
                                        product which is required to 
                                        fulfill the contract described 
                                        in such clause.
                            ``(iii) Publication.--The Secretary shall 
                        make public any reduction under this 
                        subparagraph with respect to a covered product 
                        unless the publication of such information 
                        would negatively affect national security.
                    ``(B) International partnership agreements.--In the 
                case of--
                            ``(i) any upper-middle-income country, or
                            ``(ii) any country which has entered into a 
                        mutual defense treaty or security partnership 
                        with the United States,
                the United States Trade Representative (in consultation 
                with the Secretary of Defense and the Secretary of 
                State) may permit such country to be subject to the 
                requirements applicable to a low-income country or a 
                lower-middle-income country under section 203 of the 
                Foreign Pollution Fee Act of 2023 if completion of an 
                international partnership agreement with such country 
                is determined to assist in the national security or 
                geopolitical positioning of the United States.
            ``(4) Free trade agreement.--In the case of any covered 
        product--
                    ``(A) which is produced in a country with which the 
                United States has a free trade agreement,
                    ``(B) for which all of the transforming parts or 
                components parts necessary to produce such covered 
                product are produced within--
                            ``(i) any country with which the United 
                        States has a free trade agreement, or
                            ``(ii) the United States, and
                    ``(C) for which the pollution intensity difference 
                is not greater than 50 percent,
                the variable charge shall be zero.
    ``(e) Limitation.--Subsection (d) shall not apply to any covered 
product which is produced in a country which is classified as a 
nonmarket economy country unless such country--
            ``(1) is a low-income country or a lower-middle-income 
        country, and
            ``(2) is a party to an international partnership agreement.
    ``(f) Circumvention.--
            ``(1) In general.--If the Secretary (in consultation with 
        the United States Trade Representative, the appropriate 
        congressional committees, and any relevant Federal agency) 
        determines that any country is attempting to circumvent 
        application of the fee imposed under section 4691, the 
        Secretary shall adjust the variable charge in such manner is as 
        deemed necessary to offset such circumvention.
            ``(2) Inclusion.--For purposes of this subsection, 
        circumvention of the fee imposed under section 4691 shall 
        include--
                    ``(A) artificially decreasing the price for which a 
                covered product is sold, and
                    ``(B) subsidization to producers within the country 
                of origin to offset such fee.
            ``(3) Determination.--If the Secretary determines that a 
        country is attempting to circumvent application of the fee 
        imposed under section 4691, the Secretary shall publish in the 
        Federal Register--
                    ``(A) a justification for such determination,
                    ``(B) the adjusted variable charge applicable to 
                any covered product produced in such country, and
                    ``(C) the date (not later than 6 months after the 
                date of publication) on which the adjusted variable 
                charge will begin application.

``SEC. 4693. CALCULATION OF POLLUTION INTENSITY.

    ``(a) In General.--For purposes of determining the applicable tiers 
for covered products under section 4692(b), the Secretary and the Board 
shall develop consistent methods for calculating the pollution 
intensity of any covered product which are specific to the country of 
origin.
    ``(b) Form.--
            ``(1) In general.--With respect to any covered product, the 
        pollution intensity of such product shall be expressed based on 
        the average pollution intensity associated with the 
        manufacturing of such product (including point source pollution 
        and upstream pollution) in the country of origin.
            ``(2) Specificity.--
                    ``(A) In general.--To the maximum extent 
                practicable, the pollution intensity of a covered 
                product shall be specific to the applicable 6-digit HTS 
                subheading number.
                    ``(B) Crude oil.--In the case of a covered product 
                described in section 4695(a)(4), the pollution 
                intensity of the covered product shall be specific to 
                the applicable 8-digit HTS subheading number.
            ``(3) Exception.--In the case of a covered product (with 
        the exception of a covered product described in section 
        4695(a)(4)) for which data is not available to determine 
        pollution intensity in a manner specific to the 6-digit HTS 
        subheading number, the Secretary and the Board may determine 
        the pollution intensity based on the applicable 4-digit HTS 
        heading.
    ``(c) Data.--
            ``(1) In general.--To the extent necessary for any 
        determination with respect to any covered product, the 
        Secretary and the Board may use--
                    ``(A) economic, statistical, and engineering models 
                and analysis,
                    ``(B) pollution monitoring data from facilities, 
                satellites, and other pollution monitoring tools, 
                provided that such data--
                            ``(i) is publicly available, or
                            ``(ii) is not publicly available but is 
                        able to be accessed and verified on a 
                        consistent basis by the Secretary or the head 
                        of any relevant Federal agency,
                    ``(C) voluntarily reported data, provided that such 
                data is--
                            ``(i) a product of monitored emissions, and
                            ``(ii) able to be verified by the Secretary 
                        or the Board,
                    ``(D) the best available information on technology 
                performance levels for the industrial sector that 
                produces such product, and
                    ``(E) manufacturing and pollution data which is 
                specific to a covered product, including relevant data 
                with respect to the point source pollution and upstream 
                pollution, the industrial sector which is associated 
                with such product, and the country of origin.
            ``(2) Data preference.--
                    ``(A) In general.--To the greatest extent possible, 
                in determining baseline pollution intensity, the 
                Secretary and the Board shall give preference to data 
                collected through regulatory reporting methods by the 
                Environmental Protection Agency.
                    ``(B) Data collection.--To the extent necessary to 
                carry out the purposes of this subchapter, the 
                Administrator may alter the Greenhouse Gas Reporting 
                Program (as established under part 98 of title 40, Code 
                of Federal Regulations) to include the reporting of 
                production from stationary sources regarding--
                            ``(i) the quantity of any product produced, 
                        and
                            ``(ii) the heading, subheading, and 
                        statistical reporting number of the HTS under 
                        which the product would be classified if the 
                        product were imported.
            ``(3) Access to information.--
                    ``(A) In general.--The head of every relevant 
                Federal agency shall provide the Secretary and the 
                Board with any information held by or otherwise 
                available to the head of such Federal agency which is 
                relevant to the calculation of pollution intensity.
                    ``(B) Confidentiality.--With respect to any 
                information or data relating to operational practices 
                or manufacturing processes of any producer of a covered 
                product which is provided to the Secretary and the 
                Board pursuant to subparagraph (A), unless such 
                information or data is otherwise publicly available, 
                the head of any relevant Federal agency shall take such 
                measures as are necessary to ensure that such 
                information and data is aggregated and anonymized.
    ``(d) Methodology.--
            ``(1) In general.--For purposes of creating a process for 
        calculating the pollution intensity of any covered product 
        under subsection (a), the Secretary and the Board shall--
                    ``(A) use the best, and most granular, data 
                available in the United States to establish the 
                baseline pollution intensity with respect to such 
                product, and
                    ``(B) in the case of a covered product produced 
                outside of the United States, base the calculation of 
                the pollution intensity of such product on the process 
                used to establish the baseline pollution intensity for 
                such product.
            ``(2) Treatment of different manufacturing methods and 
        locations.--For purposes of calculating the baseline pollution 
        intensity of a covered product, such calculations shall seek to 
        account for differences in pollution intensity due to--
                    ``(A) varied manufacturing methods,
                    ``(B) differences in geographic location associated 
                with upstream pollution intensity, and
                    ``(C) the proportion of manufacturing of such 
                product which is associated with the methods and 
                differences described in subparagraphs (A) and (B) 
                relative to total domestic production of such product.
            ``(3) Treatment of recycled materials.--Any recycled 
        material (as defined in section 246.101(w) of title 40, Code of 
        Federal Regulations) shall be deemed to have a pollution 
        intensity of zero if recycled (as defined in section 246.101(x) 
        of such title) into--
                    ``(A) a contributing part,
                    ``(B) a component part, or
                    ``(C) a covered product.
            ``(4) Treatment of carbon oxides.--
                    ``(A) In general.--Any carbon oxide captured from 
                manufacturing processes or from ambient air by the 
                producer of a covered product, or verifiably purchased 
                by the producer of a covered product as an offset from 
                an entity operating carbon capture infrastructure, 
                shall have the effect of reducing the pollution 
                associated with the production of a covered product if 
                such carbon oxide is--
                            ``(i) utilized in the creation of a 
                        contributing part, component part, transforming 
                        part, or covered product,
                            ``(ii) utilized to help access a 
                        contributing part, component part, transforming 
                        part, or covered product that is extracted from 
                        a geologic formation, or
                            ``(iii) verifiably sequestered in the 
                        country of origin of such product in a manner 
                        which provides an accurate accounting of the 
                        storage of such carbon oxide.
                    ``(B) Accounting.--Any carbon oxide utilized or 
                sequestered as described in subparagraph (A) shall be--
                            ``(i) treated as a reduction in pollution 
                        associated with the production of a covered 
                        product based on the total tons of carbon oxide 
                        utilized or sequestered, and
                            ``(ii) eligible to offset all forms of 
                        pollution based on the relevant carbon dioxide 
                        equivalent value.
            ``(5) Treatment of covered products with multiple parts.--
                    ``(A) In general.--In the case of a covered product 
                described in subparagraph (B) which contains any 
                covered component part or covered transforming part, to 
                the maximum extent practicable, the pollution intensity 
                of such covered component part or covered transforming 
                part shall be calculated based on--
                            ``(i) the amount of such covered component 
                        part or covered transforming part originating 
                        in each country of origin (including the United 
                        States) which supply such covered component 
                        part or covered transforming part for the 
                        covered product, and
                            ``(ii) the pollution intensity associated 
                        with production of such covered component part 
                        or covered transforming part within the country 
                        of origin.
                    ``(B) De minimis rule.--For purposes of 
                subparagraph (A), a covered component part or covered 
                transforming part shall not be included if such covered 
                component part or covered transforming part accounts 
                for less than 5 percent of--
                            ``(i) the total weight of the covered 
                        product,
                            ``(ii) the total monetary value of the 
                        covered component parts or covered transforming 
                        parts contained in the covered product, and
                            ``(iii) the pollution intensity of the 
                        covered product (as otherwise determined under 
                        such subparagraph).
                    ``(C) Additional measurements.--In the case of a 
                petition to include a product which contains any other 
                covered component part or covered transforming part as 
                a covered product under section 4695(d), such 
                petition--
                            ``(i) shall provide such information as is 
                        deemed necessary to make any calculation under 
                        subparagraph (A), and
                            ``(ii) may include, at the election of the 
                        petitioner, additional calculations to achieve 
                        an accurate determination of the pollution 
                        intensity of such product which are not tied 
                        solely to the pollution intensity of the 
                        covered component part or covered transforming 
                        part.
            ``(6) Treatment of facility-specific agreements.--For the 
        purpose of determining the pollution intensity of any covered 
        product which is produced in a foreign country, if--
                    ``(A) such product is produced in a facility which 
                is--
                            ``(i) located in such country, and
                            ``(ii) covered by an agreement established 
                        under section 204 of the Foreign Pollution Fee 
                        Act of 2023, and
                    ``(B) the pollution intensity of the product 
                produced in such facility would otherwise lower the 
                average pollution intensity associated with the 
                production of such product in such country,
        the pollution intensity of the product produced in such 
        facility shall not be included for purposes of calculating the 
        pollution intensity associated with production of such product 
        in the country of origin.
    ``(e) Alterations for Foreign Data.--For purposes of determining 
the pollution intensity values with respect to any country of origin 
for a covered product, if--
            ``(1) the baseline pollution intensity for such covered 
        product was determined utilizing a methodology based on data 
        described in subsection (c) which was provided at a more 
        localized level, or in more granular detail, than the data 
        available with respect to the country of origin, or
            ``(2) due to unavailable or unverifiable data with respect 
        to the country of origin, such determination required 
        estimation through modeling which was not performed for 
        purposes of the calculation of the baseline pollution 
        intensity,
the pollution intensity otherwise determined under this section with 
respect to production of such covered product in such country of origin 
shall be increased by 20 percent.
    ``(f) Foreign Illustration of Pollution Intensity.--
            ``(1) In general.--Any country may provide the Secretary 
        with access to any data necessary to establish an alternative 
        pollution intensity with respect to any covered product.
            ``(2) Alternative pollution intensity.--
                    ``(A) In general.--In the case of a country which 
                provides data described in paragraph (1), the Secretary 
                may adjust the pollution intensity with respect to any 
                covered product, provided that the country providing 
                such data--
                            ``(i) ensures the accuracy of all relevant 
                        data for all covered products,
                            ``(ii) provides data at a level of 
                        granularity which satisfies the methods 
                        established by the Board, and
                            ``(iii) provides the data consistently and 
                        in a manner that is verifiable by the 
                        Secretary.
                    ``(B) Role of the board.--For purposes of this 
                paragraph, the Board shall assist the Secretary by 
                verifying relevant data and calculating adjustments to 
                pollution intensities.
            ``(3) Publication of alternative pollution intensity 
        values.--In the case of any pollution intensity with respect to 
        any covered product which is adjusted pursuant to paragraph 
        (2)--
                    ``(A) the Secretary shall publish such adjustment 
                in the Federal Register, and
                    ``(B) such adjustment shall take effect in the 
                following calendar year.
    ``(g) Treatment of Potential Circumvention and Outliers.--
            ``(1) In general.--On or after the date of the first 
        reassessment required under section 4698, the Secretary, in 
        consultation with the United States Trade Representative, may 
        assign a product which is produced by a foreign producer to a 
        tier which is different from the tier determined under section 
        4692 with respect to the country of origin in which such 
        producer is located if--
                    ``(A) subsequent to the applicable date (as 
                described in section 4691(a)(2)), such foreign producer 
                has increased production of such product by not less 
                than 5 percent through the establishment of a new 
                production facility or the expansion of an existing 
                production facility, and
                    ``(B) the increase in production described in 
                subparagraph (A) results in an increase in pollution 
                intensity associated with production of such product by 
                such foreign producer which is at least 5 percent 
                greater than the pollution intensity associated with 
                production of such product in such country (as 
                determined under paragraph (2)).
            ``(2) Comparison of pollution intensity.--For purposes of 
        paragraph (1)(B), the pollution intensity associated with 
        production of a covered product in a foreign country shall be 
        equal to the lowest pollution intensity determination with 
        respect to production of such product in such country for any 
        period beginning after the applicable date under section 
        4691(a)(2).
            ``(3) Treatment of foreign ownership.--For purposes of 
        paragraph (1), if the Secretary determines that--
                    ``(A) a foreign producer is owned, operated, or 
                majority financed by--
                            ``(i) a country (referred to in this 
                        paragraph as the `base country') other than the 
                        country in which the production facility is 
                        located, or
                            ``(ii) an entity which is headquartered in 
                        the base country, and
                    ``(B) the pollution intensity associated with 
                production of the covered product in the base country 
                is greater than the pollution intensity associated with 
                production of such product by the foreign producer,
        the Secretary shall assign the covered product which is 
        produced by such foreign producer to the same tier determined 
        under section 4692 with respect to production of such covered 
        product in the base country.
            ``(4) Foreign producer.--For purposes of this subsection, 
        the term `foreign producer' means any producer which is not a 
        domestic producer.

``SEC. 4694. TREATMENT OF INTERNATIONAL PARTNERSHIPS.

    ``(a) Adjustment of Fee for Partner Countries.--In the case of a 
covered product which is produced in a country which is a party to an 
international partnership agreement which satisfies the conditions 
under sections 201 and 202 of the Foreign Pollution Fee Act of 2023 
(referred to in this section as a `partner country'), no fee under 
section 4691 shall apply.
    ``(b) Elimination of Treatment of Foreign Data.--Section 4693(e) 
shall not apply to any partner country.

``SEC. 4695. COVERED PRODUCTS.

    ``(a) In General.--The term `covered product' means articles 
classifiable under the same 6-digit subheading number of the HTS within 
one of the following categories:
            ``(1) Aluminum classifiable under any of headings 7601 
        through 7616 of the HTS.
            ``(2) Biofuels classifiable under subheading 2207.10 or 
        2207.20, or heading 3826, of the HTS.
            ``(3) Cement classifiable under heading 2523, 6810, or 
        6811, or subheading 3824.50, of the HTS.
            ``(4) Crude oil classifiable under heading 2709 of the HTS.
            ``(5) Glass classifiable under any of headings 7001 through 
        7020 of the HTS.
            ``(6) Hydrogen, methanol, or ammonia classifiable under 
        heading 2814 or any of subheadings 2804.10, 2905.11, 3102.10, 
        3102.30, or 3102.80 the HTS.
            ``(7) Iron and steel classifiable under any of headings 
        7201 through 7326 of the HTS.
            ``(8) Lithium-ion batteries classifiable under subheading 
        8507.60 of the HTS.
            ``(9) Minerals classifiable under any of the following 
        headings or subheadings of the HTS:


``2504................................  2825.50......................  3801.10
2612.10...............................  2827.41......................  7401 through 7404
2804.69...............................  2833.24......................  7406
2820.10...............................  2836.91......................  7501 through 7504
2822.00...............................  2844.10......................  8105.20
2825.20...............................  2844.20......................  8105.30
2825.40...............................  2844.30......................  8111.
 

            ``(10) Natural gas classifiable under subheading 2711.11 or 
        2711.21 of the HTS.
            ``(11) Petrochemicals classifiable under heading 2901 or 
        subheading 2711.14 of the HTS.
            ``(12) Plastics classifiable under any of headings 3901 
        through 3926 of the HTS.
            ``(13) Pulp and paper classifiable under any of headings 
        4701 through 4707 or 4801 through 4813 of the HTS.
            ``(14) Refined petroleum products classifiable under any of 
        headings 2710, 2712 through 2715, or 2803 or subheadings 
        2902.20, 2902.30, or 2902.44, of the HTS.
            ``(15) Solar cells and panels classifiable under any of 
        subheadings 8541.42 through 8541.43 or 8501.71 through 8501.80 
        of the HTS.
            ``(16) Wind turbines classifiable under subheading 8502.31 
        of the HTS.
    ``(b) Determination of Relevant HTS Numbers.--
            ``(1) In general.--The Secretary shall include, in the 
        final rule required by section 4698, a list of covered products 
        that includes the appropriate heading or subheading of the HTS 
        for each such product.
            ``(2) Scope.--Inclusion of a HTS code under paragraph (1) 
        shall only apply with respect to a covered product if such 
        product is--
                    ``(A) described in subsection (a) and not subject 
                to an exception under section 4692(d)(2), or
                    ``(B) added pursuant to subsection (d) or (e).
    ``(c) Naturally Occurring Covered Products.--
            ``(1) Pollution intensity calculations.--In the case of a 
        naturally occurring covered product which is refined in a 
        manner whereby such product becomes a transforming part for 
        multiple other products (referred to in this paragraph as a 
        `resulting product'), the pollution intensity associated with 
        the refining of the naturally occurring covered product shall 
        be divided between the resulting products in a manner 
        consistent with the proportion of the naturally occurring 
        product which is utilized in each resulting product and the 
        quantity of each resulting product.
            ``(2) Definition.--For purposes of this subsection, the 
        term `naturally occurring covered product' means crude oil or 
        minerals.
    ``(d) Additional Covered Products.--
            ``(1) In general.--An eligible entity may submit a petition 
        (or, in the case of more than one eligible entity, may jointly 
        submit a petition) to the Secretary for any product (based on 
        the 6-digit subheading number of the product under the HTS) to 
        be included as a covered product for purposes of this 
        subchapter.
            ``(2) Eligible entity.--For purposes of this subsection, 
        the term `eligible entity' means, with respect to any product--
                    ``(A) a domestic producer of such product,
                    ``(B) trade organizations consisting of producers 
                of such product,
                    ``(C) labor unions representing individuals 
                employed in the production of such product, and
                    ``(D) individuals employed in the production of 
                such product.
            ``(3) Threshold.--The Secretary may not approve a petition 
        described in paragraph (1) with respect to any product unless 
        not less than 50 percent of the total annual domestic 
        production with respect to such product is attributable to 
        domestic producers which are represented in such petition.
            ``(4) Measurement.--
                    ``(A) In general.--For purposes of determining 
                whether the total annual domestic production 
                requirement under paragraph (3) has been satisfied, the 
                petitioners may elect whether such determination shall 
                be made on the basis of--
                            ``(i) net tons of production during the 
                        preceding year, or
                            ``(ii) net monetary value of sales of the 
                        product during the preceding year.
                    ``(B) Treatment of trade organizations.--For 
                purposes of subparagraph (A), in the case of a trade 
                organization described in paragraph (2)(B), the total 
                annual domestic production attributable to any domestic 
                producer which is part of such organization shall be 
                included for purposes of determining whether the 
                requirement under such subparagraph has been satisfied.
                    ``(C) Treatment of labor unions and individuals.--
                For purposes of subparagraph (A), in the case of a 
                labor union described in paragraph (2)(C) or 
                individuals described in paragraph (2)(D) (referred to 
                in this subparagraph as `petitioning employees'), the 
                total annual domestic production attributable to such 
                labor union or the petitioning employees shall be 
                determined based on--
                            ``(i) the total production of the product 
                        during the preceding year by any producer that 
                        employs members of such labor union or 
                        petitioning employees, and
                            ``(ii) the percentage of the total number 
                        of employees of such producers during the 
                        preceding year who are members of such labor 
                        union or petitioning employees.
                    ``(D) Exclusion of double counting.--In the case of 
                more than 1 eligible entity which is included in a 
                petition, the Secretary shall ensure that any 
                production attributable to each such eligible entity is 
                not included in the determination under paragraph (3) 
                more than once.
            ``(5) Petition.--With respect to any product, the petition 
        described in paragraph (1) shall include--
                    ``(A) the applicable HTS code with respect to such 
                product,
                    ``(B) the eligible entities and the percentage of 
                domestic production represented by such eligible 
                entities, and
                    ``(C) proposed methods for determination of the 
                pollution intensity with respect to such product.
            ``(6) Pollution intensity.--For purposes of paragraph 
        (5)(C), the proposed methods shall--
                    ``(A) satisfy the applicable requirements under 
                section 4693,
                    ``(B) utilize existing pollution intensity values 
                for any covered component part, covered contributing 
                part, or covered transforming part contained in the 
                product, and
                    ``(C) at the election of the petitioner, for 
                purposes of achieving an accurate calculation of 
                pollution intensity, include additional methods to 
                determine the pollution intensity of any component part 
                or transforming part which is not included under 
                subparagraph (B).
            ``(7) Implementation.--
                    ``(A) In general.--Not later than 30 days after the 
                date on which the petition described in paragraph (1) 
                was received by the Secretary, the Secretary shall 
                determine whether the domestic production requirement 
                under such paragraph is satisfied with respect to the 
                product to be included as a covered product.
                    ``(B) Inclusion as covered product.--For purposes 
                of subparagraph (A), if the Secretary determines that 
                the domestic production requirement under paragraph (3) 
                is satisfied with respect to the product--
                            ``(i) such product shall be included as a 
                        covered product for purposes of this 
                        subchapter,
                            ``(ii) the inclusion of such product as a 
                        covered product shall be published in the 
                        Federal Register, and
                            ``(iii) such product shall be subject to 
                        the rulemaking process under section 4698(d).
                    ``(C) Determination of pollution intensity.--
                Subsequent to any determination under subparagraph (B) 
                to include a product as a covered product for purposes 
                of this subchapter, the Board shall--
                            ``(i) review the proposed methods for 
                        determination of the pollution intensity with 
                        respect to such product (as described in 
                        paragraph (5)(C)), and
                            ``(ii) make any adjustments necessary to--
                                    ``(I) ensure compliance with the 
                                requirements under section 4693, and
                                    ``(II) account for availability of 
                                necessary data and information for such 
                                determination.
    ``(e) Critical Minerals.--
            ``(1) In general.--In the case of any mineral which--
                    ``(A) is not described in subsection (a)(9), and
                    ``(B) is included on the list of critical minerals 
                published by the United States Geological Survey,
        the Secretary, in consultation with the United States Trade 
        Representative, may elect to include such mineral as a covered 
        product for purposes of this subchapter.
            ``(2) Publication and rulemaking.--In the case of any 
        mineral which is included as a covered product by the Secretary 
        pursuant to paragraph (1)--
                    ``(A) the inclusion of such product as a covered 
                product shall be published in the Federal Register, and
                    ``(B) such product shall be subject to the 
                rulemaking process under section 4698(d).
    ``(f) Application for Additional Covered Products.--With respect to 
any product included as a covered product under subsection (d) or (e), 
imposition of the fee under section 4691 shall take effect in the first 
calendar year beginning after the issuance of the final rule described 
in section 4698(d)(1)(B).

``SEC. 4696. NATIONAL LABORATORY ADVISORY BOARD ON GLOBAL POLLUTION 
              CHALLENGES.

    ``(a) In General.--
            ``(1) Establishment.--There is hereby established the 
        National Laboratory Advisory Board on Global Pollution 
        Challenges (referred to in this subchapter as the `Board').
            ``(2) Duties.--The Board shall--
                    ``(A) in accordance with section 4693, establish 
                methods of calculating--
                            ``(i) the baseline pollution intensity, as 
                        determined based on production of the covered 
                        product in the United States, and
                            ``(ii) the respective pollution intensity 
                        for production of such covered product in any 
                        foreign country,
                    ``(B) provide recommendations for rulemaking and 
                reassessments in accordance with section 4698, and
                    ``(C) provide assistance with regard to subsections 
                (f) and (g) of section 4693, as well as any other 
                requests from the Secretary.
            ``(3) Chair.--The chair of the Board (referred to in this 
        section as the `Chair') shall be the Director of the National 
        Energy Technology Laboratory.
            ``(4) Deputy chairs.--The deputy chairs of the Board 
        (referred to in this section as the `Deputy Chairs') shall be--
                    ``(A) the Director of Idaho National Laboratory,
                    ``(B) the Director of the National Renewable Energy 
                Laboratory,
                    ``(C) the Director of the Pacific Northwest 
                National Laboratory, and
                    ``(D) the Chair of the Council of Environmental 
                Quality.
            ``(5) Other board members.--
                    ``(A) In general.--In addition to the Chair and 
                Deputy Chairs, the Board shall consist of--
                            ``(i) 2 representatives from each of the 
                        industrial sectors described in paragraphs (1) 
                        through (16) of section 4695(a), and
                            ``(ii) 1 representative from each relevant 
                        Federal agency, as designated by such agency.
                    ``(B) Appointment.--
                            ``(i) Initial appointment.--For purposes of 
                        subparagraph (A)(i), each industrial sector 
                        described in paragraphs (1) through (16) of 
                        section 4695(a) shall (pursuant to clause (ii)) 
                        designate the representatives to serve for the 
                        36-month period subsequent to the date of 
                        enactment of this subchapter.
                            ``(ii) Appointment process.--The Secretary 
                        shall establish a process by which--
                                    ``(I) an individual who would 
                                satisfy the requirements described in 
                                subparagraph (C) can be nominated 
                                (including by self-nomination) to serve 
                                as a representative on the Board,
                                    ``(II) allows each domestic 
                                producer of the relevant industrial 
                                sector the opportunity to elect 
                                individuals nominated under subclause 
                                (I) to serve on the Board,
                                    ``(III) any representative elected 
                                to serve on the Board is designated in 
                                a timely manner with respect to 
                                relevant rulemakings under section 
                                4698, and
                                    ``(IV) a new round of nominations 
                                and elections occurs for each 
                                reassessment under section 4698(c).
                    ``(C) Representatives.--For purposes of 
                subparagraph (A)(i), each elected representative shall 
                be the highest ranking officer (or their designee) of a 
                domestic producer which--
                            ``(i) manufactures a product which is 
                        included under paragraphs (1) through (16) of 
                        section 4695(a), and
                            ``(ii) has annual revenues of greater than 
                        $40,000,000.
            ``(6) Approval of recommendations.--For purposes of any 
        recommendations required to be submitted to the Secretary under 
        subsection (b), not less than two-thirds of the representatives 
        described in paragraph (5)(A)(i) shall be required to approve 
        such recommendation.
            ``(7) Staff.--
                    ``(A) In general.--With respect to carrying out any 
                duties described in paragraph (2), any laboratory 
                described in paragraph (3) or (4) may designate staff 
                to assist with such duties.
                    ``(B) Detailees.--Upon the Board's request, the 
                Administrator, the Secretary of Energy, and the 
                Director of the Office of Science and Technology Policy 
                shall detail, without reimbursement, employees from 
                each agency to assist the Board in carrying out its 
                duties under this section.
    ``(b) Failure To Submit Recommendations.--In any case in which the 
Board fails to timely transmit a recommendation under section 4698, the 
Secretary may establish rules, or alter reassessments, required under 
this section or section 4698 without consultation of the Board.
    ``(c) No Cause of Action.--Any recommendation, verification, or 
report issued by the Board under this section shall not create or give 
rise to any claim or cause of action.

``SEC. 4697. DEFINITIONS.

    ``(a) In General.--For purposes of this subchapter--
            ``(1) Administrator.--The term `Administrator' means the 
        Administrator of the Environmental Protection Agency.
            ``(2) Appropriate congressional committees.--The term 
        `appropriate congressional committees' means the Committee on 
        Finance of the Senate and the Committee on Ways and Means of 
        the House of Representatives.
            ``(3) Baseline pollution intensity.--The term `baseline 
        pollution intensity' means the pollution intensity associated 
        with production of a covered product in the United States.
            ``(4) Carbon dioxide equivalent.--The term `carbon dioxide 
        equivalent' means, with respect to a greenhouse gas, the 
        quantity of such gas that has a global warming potential 
        equivalent, determined over a 100-year period, to 1 metric ton 
        of carbon dioxide, as determined pursuant to table A-1 of 
        subpart A of part 98 of title 40, Code of Federal Regulations, 
        as in effect on January 1, 2023.
            ``(5) Component part.--The term `component part' means, 
        with respect to a covered product, any component which is 
        contained as an independent product utilized in the completed 
        covered product.
            ``(6) Contributing part.--The term `contributing part' 
        means, with respect to a covered product, any product which was 
        used in the creation of such covered product in a manner which 
        is consistent with--
                    ``(A) combustion of such product to provide energy 
                to produce the covered product, or
                    ``(B) utilization of such product to provide 
                electricity necessary to operate machinery used to 
                create the covered product.
            ``(7) Country of origin.--The term `country of origin' 
        means--
                    ``(A) the country in which a covered product was 
                produced, or
                    ``(B) the last country in which a covered product 
                was substantially transformed,
        as determined in a manner consistent with U.S. Customs and 
        Border Protection procedures, directly prior to importation 
        into the United States.
            ``(8) Covered component part.--The term `covered component 
        part' means any component part which is itself a covered 
        product.
            ``(9) Covered contributing part.--The term `covered 
        contributing part' means any contributing part which is itself 
        a covered product.
            ``(10) Covered entity.--The term `covered entity' means 
        importer of record of a covered product at the time of the 
        importation of such product.
            ``(11) Covered transforming part.--The term `covered 
        transforming part' means any transforming part which is itself 
        a covered product.
            ``(12) Domestic producer.--The term `domestic producer' 
        means a producer which--
                    ``(A) has filed their articles of incorporation in 
                the United States, and
                    ``(B) is not a subsidiary of an entity which is 
                incorporated in a nonmarket economy country.
            ``(13) Export or development financing.--The term `export 
        or development financing' means financing--
                    ``(A) for the purposes of--
                            ``(i) developing international production 
                        capacity, or
                            ``(ii) securing the exportation of goods or 
                        technology manufactured in the United States 
                        (including technologies used to manufacture 
                        covered products), and
                    ``(B) which is provided by--
                            ``(i) the Department of Energy,
                            ``(ii) the Department of Commerce,
                            ``(iii) the Department of State,
                            ``(iv) the Export-Import Bank of the United 
                        States,
                            ``(v) the United States International 
                        Development Finance Corporation,
                            ``(vi) the Trade and Development Agency,
                            ``(vii) the United States Agency for 
                        International Development, or
                            ``(viii) the Office of the United States 
                        Trade Representative.
            ``(14) Free trade agreement.--The term `free trade 
        agreement' means an agreement with 1 or more countries which--
                    ``(A) reduces or eliminates tariffs and non-tariff 
                barriers between the countries party to such agreement, 
                and
                    ``(B) is approved by Congress.
            ``(15) Greenhouse gas.--The term `greenhouse gas' has the 
        meaning given such term in section 98.6 of title 40, Code of 
        Federal Regulations (as in effect on the date of enactment of 
        this subchapter).
            ``(16) HTS.--The term `HTS' means the Harmonized Tariff 
        Schedule of the United States.
            ``(17) International partnership agreement.--The term 
        `international partnership agreement' means an international 
        partnership agreement established pursuant to title II of the 
        Foreign Pollution Fee Act of 2023.
            ``(18) Nonmarket economy country.--The term `nonmarket 
        economy country' has the meaning given such term in section 
        771(18) of the Tariff Act of 1930 (19 U.S.C. 1677(18)).
            ``(19) Point source pollution.--The term `point source 
        pollution' means pollution emitted into the ambient air at the 
        site of the manufacturing of a product.
            ``(20) Pollution.--The term `pollution' means greenhouse 
        gas emissions.
            ``(21) Pollution intensity.--The term `pollution intensity' 
        means the amount of greenhouse gases (as determined under 
        section 4693), expressed in metric tons of carbon dioxide 
        equivalent, which are emitted into the atmosphere in the 
        production of a single unit of a covered product (as determined 
        pursuant to section 4691(c)).
            ``(22) Pollution intensity difference.--The term `pollution 
        intensity difference' means, with respect to any covered 
        product, the difference (expressed as a percentage) between--
                    ``(A) the pollution intensity associated with 
                production of such product in the country of origin, 
                and
                    ``(B) the baseline pollution intensity with respect 
                to such product.
            ``(23) Producer.--The term `producer' means the entity 
        responsible for the creation of a product through--
                    ``(A) a manufacturing process, or
                    ``(B) in the case of a geologic resource, 
                extraction.
            ``(24) Product.--The term `product' means any article, 
        regardless of whether such article is--
                    ``(A) exported from the country of origin, or
                    ``(B) produced and sold only within the country of 
                origin.
            ``(25) Relevant federal agency.--The term `relevant Federal 
        agency' means--
                    ``(A) the Department of the Treasury,
                    ``(B) the Department of Energy,
                    ``(C) the Office of the United States Trade 
                Representative,
                    ``(D) the Department of Commerce,
                    ``(E) the Department of State,
                    ``(F) the Environmental Protection Agency,
                    ``(G) the Council on Environmental Quality,
                    ``(H) the Office of Science and Technology Policy, 
                and
                    ``(I) the Department of Homeland Security.
            ``(26) Transforming part.--The term `transforming part' 
        means a product which is substantially transformed or refined 
        into another product.
            ``(27) Upstream pollution.--The term `upstream pollution' 
        means, with respect to any covered product--
                    ``(A) the pollution associated with all covered 
                component parts, covered contributing parts, and 
                covered transforming parts, and
                    ``(B) any fugitive pollution which occurs during 
                extraction, refining, and transport of any part 
                described in subparagraph (A).
    ``(b) World Bank Classifications.--For purposes of this 
subchapter--
            ``(1) In general.--Subject to paragraph (2), the terms 
        `high-income country', `upper-middle-income country', `lower-
        middle-income country', and `low-income country' shall be 
        defined based on the classification of the economy of a country 
        by the World Bank.
            ``(2) High-income and upper-middle-income countries.--In 
        the case of any country which, as of January 1, 2023, is 
        classified by the World Bank as a high-income country or an 
        upper-middle-income country, such country shall not be eligible 
        to be reclassified as a lower-middle-income country or a low-
        income country.

``SEC. 4698. ESTABLISHMENT PROCESS AND REASSESSMENTS.

    ``(a) In General.--The processes established under this section 
shall be utilized to--
            ``(1) provide the initial rules for application of the fee 
        imposed under section 4691, and
            ``(2) perform any required reassessment.
    ``(b) Initial Rulemaking.--
            ``(1) Classification of covered products.--Not later than 
        12 months after the date of enactment of this subchapter, the 
        Secretary shall issue a final rule for purposes of--
                    ``(A) determining the appropriate heading or 
                subheading number of the HTS for each covered product 
                (as required under section 4695(b)); and
                    ``(B) determining the appropriate measurement of 
                any covered product (as described in section 4691(c)).
            ``(2) Pollution intensity calculations.--
                    ``(A) In general.--Not later than 18 months after 
                the date of enactment of this subchapter, the Secretary 
                shall publish a final rule establishing--
                            ``(i) in a manner consistent with section 
                        4693, the pollution intensity with respect to 
                        each covered product and country of origin, and
                            ``(ii) methods for any foreign country to 
                        establish an alternative pollution intensity 
                        with respect to any covered product pursuant to 
                        subsection (f) of such section.
                    ``(B) Circumvention.--Not later than 36 months 
                after the date of enactment of this subchapter, the 
                Secretary shall publish a final rule to address 
                producers described in section 4693(g).
            ``(3) Establishment of variable charges.--Not later than 24 
        months after the date of enactment of this subchapter, the 
        Secretary (in consultation with the United States Trade 
        Representative) shall issue a final rule establishing the 
        variable charge for covered products for purposes of section 
        4692.
            ``(4) Additional rulemaking.--In addition to the rules 
        described in paragraphs (1) through (3), any rules which are 
        necessary in order to properly apply the fee under section 4691 
        shall be issued not later than the date which 24 months after 
        the date of enactment of this subchapter.
    ``(c) Reassessment.--
            ``(1) In general.--Not later than 3 years after the date of 
        the issuance of any final rule described in subsection (b), and 
        every 3 years thereafter, the Secretary shall reassess and, as 
        necessary, issue a final rule to adjust, the existing final 
        rule.
            ``(2) Revision.--The United States International Trade 
        Commission, in consultation with the Secretary, shall annually 
        publish a notice reflecting headings, subheadings, and 
        statistical reporting numbers of the HTS contained in any rule 
        issued under this section which need to be amended due to 
        revisions to the HTS.
            ``(3) Newly available data.--With respect to any 
        reassessment described in paragraph (1), the Secretary may 
        utilize any data which is available as a result of enhancements 
        in the ability to assess domestic or foreign pollution pursuant 
        to legislation enacted or developments in technology subsequent 
        to the issuance of the most recent final rule.
            ``(4) International partnerships.--In the case of an 
        international partnership agreement, the Secretary may, at the 
        time of the establishment of such agreement and in a manner 
        consistent with such agreement, issue a final rule to adjust 
        the pollution intensity for any covered product (as determined 
        pursuant to subsection (b)(2)) produced in a country which is a 
        party to such agreement.
            ``(5) Timing.--In the case of any final rule issued with 
        respect to any reassessment under paragraph (1), the 
        application of such rule shall take effect on January 1 of the 
        first calendar year beginning subsequent to the issuance of 
        such final rule.
    ``(d) Additional Covered Products.--
            ``(1) In general.--With respect to any product which is 
        included as a covered product pursuant to subsection (d) or (e) 
        of section 4695 following the publication in the Federal 
        Register (as described in subsection (d)(7)(B)(ii) or 
        subsection (e)(2)(A) of such section, as applicable)--
                    ``(A) not later than 12 months after the date of 
                such publication, the Secretary shall issue a final 
                rule with respect to the pollution intensity of such 
                covered product and any country of origin consistent 
                with the requirements under section 4693, and
                    ``(B) not later than 6 months after the issuance of 
                the final rule described in subparagraph (A), the 
                Secretary shall issue a final rule establishing the 
                variable charge for such covered product consistent 
                with the requirements under section 4692.
            ``(2) Reassessments.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), any classification or rule 
                established pursuant to paragraph (1) with respect to 
                any covered product shall remain in effect under the 
                next reassessment under subsection (c).
                    ``(B) Exception.--With respect to any product 
                included as a covered product under subsection (d) or 
                (e) of section 4695, if the date for imposition of the 
                fee under section 4691 (as determined pursuant to 
                section 4695(f)) is less than 1 year from the date of 
                the next reassessment under subsection (c), such 
                product shall not be subject to such reassessment.
    ``(e) Process.--
            ``(1) Board recommendations.--Not later than 6 months prior 
        to--
                    ``(A) the date on which any final rule is required 
                to be issued under paragraph (1), (2), or (3) of 
                subsection (b), and
                    ``(B) the date on which any reassessment is 
                required to be made under subsection (c)(1),
        the Board shall provide recommendations to the Secretary with 
        respect to such final rule or reassessment.
            ``(2) Notice.--Not later than 30 days after receiving the 
        recommendations of the Board provided under paragraph (1), the 
        Secretary shall--
                    ``(A) publish a notice of proposed rulemaking based 
                on such recommendations with respect to the final rule 
                or reassessment, and
                    ``(B) brief the appropriate congressional 
                committees and consult with such committees regarding 
                such final rule or reassessment.
            ``(3) Comment.--Following the notice under paragraph 
        (2)(A), the Secretary shall provide a public comment period of 
        not less than 60 days.
            ``(4) Consultation.--Prior to the issuance of any final 
        rule or reassessment under this section regarding the 
        appropriate classification of covered products, the Secretary 
        shall consult with--
                    ``(A) the United States Trade Representative,
                    ``(B) the United States International Trade 
                Commission,
                    ``(C) the Commissioner of U.S. Customs and Border 
                Protection, and
                    ``(D) all other relevant Federal agencies.
            ``(5) Publication.--The publication of any final rule 
        required under this section shall include a statement from the 
        Secretary explaining any deviation from the recommendations 
        submitted by the Board pursuant to paragraph (1).
    ``(f) Judicial Review.--
            ``(1) In general.--The United States Court of Appeals for 
        the District of Columbia Circuit shall have original and 
        exclusive jurisdiction over any claim with respect to any final 
        rule issued under this section.
            ``(2) Limitation.--No final rule issued under this section 
        shall be subject to judicial review unless--
                    ``(A) the claim is filed not later than 30 days 
                after the issuance of such rule, and
                    ``(B) the person filing such claim--
                            ``(i) is a citizen of the United States or 
                        a domestic producer, and
                            ``(ii)(I) demonstrates that--
                                    ``(aa) application of such rule 
                                will result in the infliction of a 
                                direct and tangible harm to such 
                                person, and
                                    ``(bb) the rulemaking process was 
                                conducted in a manner that was intended 
                                to directly harm such person, or
                            ``(II) demonstrates that such final rule--
                                    ``(aa) altered the recommendations 
                                made by the Board, and
                                    ``(bb) would limit the ability to 
                                attain the goals established under 
                                section 4692(c)(2).
            ``(3) Acceptable action.--Notwithstanding any claim or 
        cause of action filed with respect to any provision of this 
        subchapter--
                    ``(A) the applicable date described in section 
                4691(a)(2),
                    ``(B) the application of reassessment pursuant to 
                subsection (c), and
                    ``(C) with respect to covered products included 
                pursuant to subsection (d) or (e) of section 4695, the 
                date for imposition of the fee under section 4691 to 
                take effect (as determined under section 4695(f)),
        shall not be subject to judicial review and shall not be 
        subject to delay or suspension.''.

 TITLE II--INTERNATIONAL PARTNERSHIP AGREEMENTS RELATING TO POLLUTION 
                                  FEES

SEC. 201. INTERNATIONAL PARTNERSHIP AGREEMENTS.

    (a) In General.--The United States Trade Representative, at the 
direction of the President, may--
            (1) engage in negotiations with countries to encourage the 
        establishment and expansion of international partnership 
        agreements, as provided in this title;
            (2) establish agreements with foreign countries with 
        respect to proposals to enter into international partnership 
        agreements;
            (3)(A) implement such an agreement in accordance with 
        subsection (e); or
            (B) submit a proposal to Congress under subsection (f) with 
        respect to such an agreement and implement the agreement 
        following the approval of Congress in a manner consistent with 
        that subsection; and
            (4) perform the oversight and enforcement role necessary to 
        uphold any such agreement.
    (b) Consultation During Negotiation for International Partnership 
Agreements.--
            (1) In general.--With respect to negotiations for an 
        international partnership agreement under this title, the Trade 
        Representative shall--
                    (A) consult closely and on a timely basis with the 
                appropriate congressional committees, keeping those 
                committees fully apprised of the negotiations; and
                    (B) provide to those committees, including staff 
                with appropriate security clearances, access to the 
                text of any negotiating proposal or any other document 
                presented by the United States or another party to the 
                negotiations that presents concepts or considerations 
                for the negotiations not later than 5 business days 
                before the proposal or other document is formally 
                brought up for consideration in the negotiations.
            (2) Designation of advisors.--The chairperson and ranking 
        member of each of the appropriate congressional committees may 
        each designate not more than 5 Members of Congress on their 
        committee and not more than 4 individuals on the staff of that 
        committee as official advisors to negotiations.
            (3) Briefing.--
                    (A) In general.--The Trade Representative shall 
                brief the appropriate congressional committees before 
                and after every negotiation session in relation to an 
                international partnership agreement.
                    (B) Timing.--A briefing required by subparagraph 
                (A) following a negotiating session shall take place 
                not later than 5 business days following the session.
    (c) Requirements for International Partnership Agreements.--
            (1) In general.--An international partnership agreement may 
        be entered into under this title on the basis of one covered 
        product, multiple covered products, or all covered products.
            (2) Participation.--
                    (A) In general.--Subject to the requirements under 
                paragraph (3), the United States may enter into an 
                international partnership agreement under this title 
                with--
                            (i) one country;
                            (ii) multiple countries; or
                            (iii) a group of countries participating in 
                        an international forum such as the Organisation 
                        for Economic Co-operation and Development or 
                        the Group of Seven (G7).
                    (B) Expansions of ex post congressional-executive 
                international partnership agreements.--In the case of 
                an international partnership agreement previously 
                approved by Congress under subsection (f), additional 
                countries may be added to the agreement without 
                requiring further approval by Congress if the only 
                changes to the agreement--
                            (i) are the addition of a new country to 
                        the agreement; and
                            (ii) do not require alterations to 
                        subchapter E of the Internal Revenue Code of 
                        1986, as added by title I.
            (3) Requirements.--An international partnership agreement 
        entered into under this title is required to provide for--
                    (A) creation of compatible methods to promote 
                pollution reduction through trade mechanisms by 
                assessing pollution intensity differences between 
                countries;
                    (B) maintenance of the ability of a country that is 
                a party to the agreement to determine methods of 
                pollution reduction within that country;
                    (C) elimination of any fee or charge between 
                countries that are parties to the agreement in a manner 
                compatible to the process described in section 202;
                    (D) elimination or reduction of other duties, 
                import fees, and trade barriers maintained by the 
                country related to covered products;
                    (E) compatible pollution monitoring, reporting, and 
                verification methods that--
                            (i) allow for similar methods to be used to 
                        calculate the pollution intensity of covered 
                        products and countries that are parties to the 
                        agreement, on the basis of the available 
                        information within each such country;
                            (ii) allow for similar methods to be used 
                        to calculate the pollution intensity of covered 
                        products imported from countries that are not 
                        parties to the agreement; and
                            (iii) allow for each country that is a 
                        party to the agreement to consistently validate 
                        the monitoring and reporting information of the 
                        other countries that are parties to the 
                        agreement with respect to products covered by 
                        the agreement;
                    (F) design characteristics compatible with 
                subchapter E of the Internal Revenue Code, as added by 
                title I;
                    (G) design characteristics compatible with the 
                provisions of this title; and
                    (H) processes for how to add--
                            (i) additional countries to the agreement; 
                        and
                            (ii) additional covered products to the 
                        agreement.
            (4) Consideration of third-party participation.--
                    (A) In general.--An international partnership 
                agreement entered into under this title may include 
                direction for an entity that is not from a country that 
                is a party to the agreement to--
                            (i) serve as a repository of relevant 
                        pollution data from countries that are parties 
                        to the agreement;
                            (ii) provide validation of pollution 
                        intensity calculations and other requirements 
                        under paragraph (3); and
                            (iii) adjudicate discrepancies with respect 
                        to such data and requirements between countries 
                        that are parties to the agreement.
                    (B) Limitations.--
                            (i) Access to information.--An 
                        international partnership agreement entered 
                        into under this title is required to provide 
                        for each country that is a party to the 
                        agreement to maintain the ability to access and 
                        validate any pollution information related to 
                        other countries that are parties to the 
                        agreement.
                            (ii) Scope of adjudication.--
                                    (I) In general.--An entity 
                                described in subparagraph (A) may 
                                adjudicate discrepancies between 
                                countries that are parties to an 
                                international partnership agreement 
                                entered into under this title only to 
                                the extent that such discrepancies 
                                relate to requirements under the 
                                agreement.
                                    (II) Impact on domestic laws.--An 
                                entity described in subparagraph (A) 
                                may not alter the domestic law of a 
                                country that is a party to an 
                                international partnership agreement 
                                entered into under this title, 
                                including subchapter E of the Internal 
                                Revenue Code of 1986, as added by title 
                                I.
    (d) Timeline.--
            (1) In general.--The requirements described in subsection 
        (c) with respect to an international partnership agreement are 
        required to be achieved--
                    (A) for high-income countries and upper-middle 
                income countries, not later than 3 years after entering 
                into the agreement; and
                    (B) for low-income countries and lower-middle-
                income countries, not later than 5 years after entering 
                into the agreement.
            (2) Applicability of benefits.--
                    (A) In general.--Countries described in paragraph 
                (1)(A) shall not receive the treatment described in 
                section 4694 of the Internal Revenue Code of 1986, as 
                added by title I, until the requirements under 
                subsection (c) are met.
                    (B) Termination.--The United States shall maintain 
                the right to terminate an international partnership 
                agreement if the requirements under subsection (c) are 
                not met in the time described in paragraph (1).
    (e) Ex Ante Congressional-Executive International Partnership 
Agreements.--
            (1) In general.--The United States Trade Representative 
        may, at the direction of the President, enter into and carry 
        out an international partnership agreement entered into under 
        this title without the approval of Congress if the agreement--
                    (A) complies with the requirements under subsection 
                (c); and
                    (B) does not require any alteration of subchapter E 
                of the Internal Revenue Code of 1986, as added by title 
                I.
            (2) Effect.--An agreement described in paragraph (1) that 
        complies with the requirements under subsection (c) shall 
        qualify as an international partnership agreement for purposes 
        of section 4694 of the Internal Revenue Code of 1986, as added 
        by title I.
            (3) Publication; congressional review.--An agreement 
        entered into under this subsection shall be--
                    (A) published in the Federal Register; and
                    (B) treated as a final rule prepared by an agency, 
                including with respect to review by Congress under 
                chapter 8 of title 5, United States Code (commonly 
                referred to as the ``Congressional Review Act'').
    (f) Ex Post Congressional-Executive International Partnership 
Agreements.--
            (1) In general.--An agreement shall be treated as a 
        congressional-executive agreement and enter into force only if 
        a joint resolution of approval is enacted in accordance to this 
        subsection if any alteration of subchapter E of the Internal 
        Revenue Code of 1986, as added by title I, is required to 
        implement the agreement.
            (2) Submission to congress and publication of agreement.--
        The President shall--
                    (A) post the text of an agreement described in 
                paragraph (1) on a publicly available website of the 
                Office of the United States Trade Representative for 
                not less than 5 business days; and
                    (B) submit to 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) an identification of any United States 
                        laws that may be inconsistent with the text; 
                        and
                            (ii) a statement of any administrative 
                        action proposed to implement the agreement.
            (3) Joint resolutions of approval.--
                    (A) Definition.--In this paragraph, the term 
                ``joint resolution of approval'' means only a joint 
                resolution the matter after the resolving clause of 
                which is as follows: ``That Congress approves ____, 
                submitted to Congress on _____'', with the first blank 
                space being filled with the name of the applicable 
                international partnership agreement entered into under 
                this title and the second blank space being filled with 
                the appropriate date.
                    (B) Introduction.--A joint resolution approving an 
                agreement described in paragraph (1) may be introduced 
                in either House of Congress by the chairperson or 
                ranking member of one of the appropriate congressional 
                committees.
                    (C) Procedures in house and senate.--Except as 
                provided in this paragraph, the provisions of 
                subsections (d), (e), and (f) of section 152 of the 
                Trade Act of 1974 (19 U.S.C. 2192) shall apply with 
                respect to a joint resolution of approval under this 
                paragraph to the same extent and in the same manner as 
                such provisions apply with respect to a joint 
                resolution described in subsection (a) of that section.
                    (D) Referral.--A joint resolution of approval shall 
                be referred exclusively to the appropriate 
                congressional committees.
                    (E) Discharge.--If the committee of either House to 
                which a joint resolution of approval has been referred 
                has not reported it by the close of the 40th day after 
                its introduction (excluding any day described in 
                section 154(b) of the Trade Act of 1974 (19 U.S.C. 
                2194(b))), that committee shall be automatically 
                discharged from further consideration of the joint 
                resolution and the joint resolution shall be placed on 
                the appropriate calendar.
                    (F) Consideration.--
                            (i) In general.--It is not in order for--
                                    (I) the Senate to consider any 
                                joint resolution of approval unless the 
                                joint resolution has been reported by 
                                the Committee on Finance or the 
                                committee has been discharged from 
                                consideration of the joint resolution 
                                under subparagraph (E); or
                                    (II) the House of Representatives 
                                to consider any joint resolution of 
                                approval unless it has been reported by 
                                the Committee on Ways and Means or the 
                                committee has been discharged from 
                                consideration of the joint resolution 
                                under subparagraph (E).
                            (ii) Motion to proceed in house of 
                        representatives.--A motion in the House of 
                        Representatives to proceed to the consideration 
                        of a joint resolution of approval may be made 
                        only on the second legislative day after the 
                        calendar day on which the Member making the 
                        motion announces to the House the intention of 
                        the Member to do so.
            (4) Rules of senate and house of representatives.--This 
        subsection is enacted by Congress--
                    (A) as an exercise of the rulemaking power of the 
                Senate and the House of Representatives, respectively, 
                and as such is deemed a part of the rules of each 
                House, respectively, and supersedes other rules only to 
                the extent that it is inconsistent with such other 
                rules; and
                    (B) 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.
    (g) Inclusion in Other International Agreements.--
            (1) In general.--The United States Trade Representative, at 
        the direction of the President, may seek to include an 
        expansion of an international partnership agreement in any 
        other international agreement entered into or renegotiated on 
        or after the date of the enactment of this Act, such as--
                    (A) a free trade agreement;
                    (B) an international agreement relating to 
                environmental protections, sustainable development, or 
                climate; or
                    (C) a trade agreement involving international 
                organizations such as the Organisation for Economic Co-
                operation and Development, the Group of Seven (G7), or 
                any similar organization.
    (h) Restrictions on Negotiations.--
            (1) Nonmarket economy countries.--The authority provided by 
        this section does not include the authority to negotiate or 
        enter into an agreement with a nonmarket economy country if the 
        country is--
                    (A) an upper middle-income country; or
                    (B) a high-income country.
            (2) Domestic policies.--The authority provided by this 
        section does not include the authority to negotiate or enter 
        into an agreement that would establish carbon taxes, fees, 
        pricing, or other mechanisms that impose additional costs on 
        products produced by a domestic producer by the United States.

SEC. 202. APPLICATION OF FOREIGN POLLUTION FEE IN PARTNERSHIPS.

    (a) In General.--In accordance with section 4694 of the Internal 
Revenue Code of 1986, as added by title I, no fee shall be applied 
under section 4691 of such Code with respect to a covered product 
imported from a country that is a party to an international partnership 
agreement entered into under this title if production of the covered 
product has a pollution intensity difference that is less than or equal 
to 50 percent.
    (b) Failure To Meet Requirements.--If a covered product is produced 
in a country that is a party to an international partnership agreement 
entered into under this title but does not meet the requirement 
described in subsection (a), the fee applied under section 4691 of the 
Internal Revenue Code of 1986, as added by title I, with respect to the 
covered product shall be determined based on the applicable tier (as 
described in paragraph (2) of section 4692(e) of the Internal Revenue 
Code of 1986, as added by title I) associated with--
            (1) the pollution intensity difference; reduced by
            (2) 50 percentage points.
    (c) Treatment of Low-Income and Lower-Middle Income Countries.--
            (1) In general.--During the 5-year period following the 
        entry into force of an international partnership agreement 
        under this title between the United States and a low-income 
        country or lower-middle-income country--
                    (A) the pollution intensity requirement described 
                in subsection (a) shall be considered to be met with 
                respect to covered products produced in the country; 
                and
                    (B) no fee shall be applied to covered products 
                imported from that country.
            (2) Modifications to requirements.--
                    (A) In general.--During the 10-year period 
                beginning after the completion of the 5-year period 
                described in paragraph (1), the pollution intensity 
                requirement described in subsection (a) shall be 
                considered to be met with respect to a covered product 
                produced in a country described in paragraph (1) if new 
                capacity in that country for the production of the 
                covered product developed during the 10-year period 
                described in paragraph (1) is not more than 50 percent 
                more pollution intense than the baseline pollution 
                intensity at the time of the entry into force of the 
                international partnership agreement.
                    (B) Future development.--For the 10-year period 
                beginning after the completion of the 10-year period 
                described in subparagraph (A), and each 10-year period 
                thereafter, the pollution intensity requirement 
                described in subsection (a) shall be considered to be 
                met with respect to a covered product produced in a 
                country described in paragraph (1) if new capacity in 
                that country for the production of the covered product 
                developed during the preceding 10-year period is not 
                more than 25 percent more pollution intense than the 
                baseline pollution intensity at the beginning of such 
                preceding 10-year period.
            (3) Application of fee.--If the requirements described in 
        paragraph (1) or (2), as applicable, are not met with respect 
        to a covered product, the fee specified in subsection (b) shall 
        apply.
    (d) Treatment of Circumvention.--Nothing in this section shall 
supersede section 4693(g) of the Internal Revenue Code of 1986, as 
added by title I, with respect to potential circumvention of the fee 
assessed under section 4691 of such Code if--
            (1) a determination is made under such section 4693(g) with 
        respect to a producer; and
            (2) the producer is owned, operated, or financed in or by a 
        country that is not a party to an international partnership 
        agreement entered into under this title.

SEC. 203. SUPPORT FOR PARTICIPATION OF LOW-INCOME AND LOWER-MIDDLE-
              INCOME COUNTRIES IN INTERNATIONAL PARTNERSHIP AGREEMENTS.

    (a) In General.--The United States Trade Representative, at the 
direction of the President, may include, in an international 
partnership agreement entered into under this title with a low-income 
country or a lower-middle-income country, provisions providing for--
            (1) the provision of treatment described in section 202(c) 
        to that country;
            (2) the extension of untied or tied aid through a United 
        States export, development, or trade agency for energy or 
        manufacturing technologies and projects;
            (3) lower initial requirements relating to pollution data 
        monitoring and alternative methods to more accurately project 
        and model pollution under the agreement;
            (4) support for expansion of monitoring and reporting of 
        pollution; and
            (5) technical assistance to ensure full compliance with the 
        terms of the agreement.
    (b) Benchmarks and Requirements.--
            (1) In general.--The United States Trade Representative 
        shall establish benchmarks or requirements to assess the 
        progress of a country described in subsection (a) in fully 
        implementing the terms of the international partnership 
        agreement entered into under this title.
            (2) Benchmarks.--The benchmarks and requirements 
        established under paragraph (1) with respect to a country shall 
        include--
                    (A) improving methods of monitoring, reporting, and 
                verifying pollution levels;
                    (B) if, after the entry into force of the 
                international partnership agreement, new manufacturing 
                or production capacity for a covered product is built 
                in the country but that capacity is owned or operated, 
                or the majority of the financing for that capacity is 
                provided, by an entity associated with a country that 
                is not a party to an international partnership 
                agreement, treating the new capacity--
                            (i) at the pollution intensity of the 
                        country that is not a party to an international 
                        partnership agreement if the pollution 
                        intensity for the covered product produced in 
                        that country is greater than the pollution 
                        intensity of the covered product produced in 
                        the country that is a party to the 
                        international partnership agreement;
                            (ii) as not eligible for the treatment of a 
                        country that is a party to an international 
                        partnership agreement described in section 202; 
                        and
                            (iii) in accordance to the requirements of 
                        section 4694 of the Internal Revenue Code of 
                        1986, as added by title I;
                    (C) if, after the entry into force of the 
                international partnership agreement, the ownership, a 
                stake of ownership, or operation of manufacturing or 
                production capacity for a covered product that is in 
                operation on the date of entry into force is 
                transferred to an entity in a country that is not a 
                party to an international partnership agreement, 
                treating such capacity--
                            (i) at the pollution intensity of the 
                        country that is not a party to an international 
                        partnership agreement if the pollution 
                        intensity for the covered product produced in 
                        that country is greater than the pollution 
                        intensity of the covered product produced in 
                        the country that is a party to the 
                        international partnership agreement;
                            (ii) as not eligible for the treatment of a 
                        country that is a party to an international 
                        partnership agreement described in section 202; 
                        and
                            (iii) in accordance to the requirements of 
                        section 4694 of the Internal Revenue Code of 
                        1986, as added by title I; and
                    (D) in the case of an international partnership 
                agreement with a nonmarket economy country that is a 
                low-income country or a lower-middle-income country, 
                making progress in developing a market economy.
    (c) Termination.--The United States shall maintain the authority to 
terminate the application of the provisions described in subsection (a) 
to a country if the country does not meet the benchmarks and 
requirements under subsection (b).
    (d) Inclusion of Other International Partners.--To the maximum 
extent practicable, the United States shall seek to include additional 
high-income countries and upper-middle-income countries in 
international partnership agreements entered into under this title with 
low-income countries or lower-middle-income countries.

SEC. 204. FACILITY-SPECIFIC AGREEMENTS RELATING TO POLLUTION FEES.

    (a) Authority To Negotiate Facility-Specific Agreements.--The 
United States Trade Representative may negotiate, in coordination with 
the Secretary of the Treasury and the Administrator of the 
Environmental Protection Agency, an agreement with a facility located 
in a foreign country that allows products produced at the facility to 
be treated at a pollution intensity specific to the facility.
    (b) Requirements.--To be eligible for an agreement under subsection 
(a), a facility is required to--
            (1) consistently operate according to the standards a 
        United States facility is statutorily required to abide by, for 
        existing operations and any future expansion of operations, 
        including such standards set forth under--
                    (A) the Clean Air Act (42 U.S.C. 7401 et seq.);
                    (B) the Federal Water Pollution Control Act (33 
                U.S.C. 1251 et seq.) (commonly known as the ``Clean 
                Water Act'');
                    (C) the Safe Drinking Water Act (42 U.S.C. 300f et 
                seq.); and
                    (D) the National Environmental Policy Act of 1969 
                (42 U.S.C. 4321 et seq.);
            (2) deploy pollution monitoring equipment able to report in 
        real time the levels of pollution emitted by the facility;
            (3) provide real-time access to physical pollution 
        monitoring by United States officials or their designees;
            (4) allow for spot inspections by United States officials 
        or their designees to ensure compliance with the requirements 
        of the agreement;
            (5) if the pollution intensity of the facility is higher 
        than the pollution intensity of the United States or the least 
        pollution intense foreign country that is a party to an 
        international partnership agreement entered into under this 
        title with the United States--
                    (A) provide actionable benchmarks to decrease the 
                pollution intensity of the facility so that pollution 
                intensity is equal to or less than the pollution 
                intensity of the United States or such other country 
                not later than 10 years after entering into an 
                agreement under subsection (a);
                    (B) achieve the benchmarks described in 
                subparagraph (A) during the 10-year period described in 
                that subparagraph;
                    (C) provide actionable benchmarks to decrease, by 
                not later than 20 years after entering into an 
                agreement under subsection (a), the pollution intensity 
                of the facility to an intensity not less than 50 
                percent lower than the pollution intensity of the 
                United States at the time of entry into the agreement;
                    (D) achieve the benchmarks described in 
                subparagraph (C) during the 20-year period described in 
                that subparagraph; and
                    (E) ensure that any pollution reduction technology 
                used in achieving the benchmarks described in 
                subparagraph (A) or (C) contains not less than 50 
                percent of components of United States origin;
            (6) account for any upstream pollution--
                    (A) at the level associated with the pollution 
                intensity of the country in which the contributing part 
                or transforming part is produced, unless the part is 
                covered by an agreement entered into under subsection 
                (a); or
                    (B) if determined appropriate by the United States 
                Trade Representative and provided for in the agreement, 
                based on an applicable standard of the International 
                Organization for Standardization;
            (7) identify the covered entity with respect to covered 
        products produced at the facility if the covered entity is not 
        the owner of the facility; and
            (8) ensure the agreement may be terminated at the sole 
        discretion of the United States if the facility is not in 
        compliance with any requirement under this subsection.
    (c) Consultation With Congress.--The Trade Representative may not 
conclude an agreement under subsection (a) with a facility unless--
            (1) the Trade Representative--
                    (A) informs the appropriate congressional 
                committees of the intention of the Trade Representative 
                to pursue negotiations with the facility not less than 
                2 business days after commencing negotiations;
                    (B) shares the text of the proposed agreement with 
                the appropriate congressional committees for not less 
                than the lesser of--
                            (i) 12 days on which both Houses of 
                        Congress are in session; or
                            (ii) 60 calendar days; and
                    (C) responds to all inquiries regarding the terms 
                of the agreement from the chairperson or ranking member 
                of one of the appropriate congressional committees 
                before concluding the agreement; and
            (2) a resolution of disapproval is not enacted during the 
        period described in paragraph (1)(B).
    (d) Treatment of the Agreement.--
            (1) In general.--Any agreement entered into under this 
        section with a facility shall allow a product produced by the 
        facility and imported into the United States to be assigned to 
        the tier (as established under section 4692(b) of the Internal 
        Revenue Code of 1986, as added by title I) aligned with the 
        pollution intensity difference of a product produced by the 
        facility and the baseline pollution intensity.
            (2) Restrictions.--Under no circumstances may an agreement 
        entered into under this section require the United States to 
        alter the implementation of this Act.
    (e) Ineligibility of State-Owned Facilities in Nonmarket Economy 
Countries.--A facility in a nonmarket economy country is not eligible 
for an agreement under this section if the facility--
            (1) is owned, partially owned, or operated by the 
        government of the country or an entity owned or controlled by 
        that government; or
            (2) has received financing, including in the form of a tax 
        credit or a limit on tax liability, to operate the facility by 
        the government of the country or an entity owned or controlled 
        by that government.
    (f) Transparency.--The Trade Representative shall promptly publish 
a description of the proposed agreement under this section in the 
Federal Register.

SEC. 205. DEFINITIONS.

    In this title, the definitions set forth in section 4697 of the 
Internal Revenue Code of 1986, as added by title I, apply.
                                 <all>