[WPRT 107-4]
[From the U.S. Government Publishing Office]



107th Congress                                                    WMCP:
                            COMMITTEE PRINT                       
 1st Session                                                      107-4
_______________________________________________________________________

                                     


                      COMMITTEE ON WAYS AND MEANS

                     U.S. HOUSE OF REPRESENTATIVES


                               __________
 
                      OVERVIEW AND COMPILATION OF

                          U.S. TRADE STATUTES

                               __________

                              2001 EDITION


                                     
[GRAPHIC] [TIFF OMITTED] TONGRESS.#13


                               JUNE 2001

 Prepared for the use of Members of the Committee on Ways and Means by 
members of its staff. This document has not been officially approved by 
      the Committee and may not reflect the views of its Members.

                               ----------

                   U.S. GOVERNMENT PRINTING OFFICE
71-824                     WASHINGTON : 2001


            For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 
                                 20402
  

                      COMMITTEE ON WAYS AND MEANS


                     U.S. HOUSE OF REPRESENTATIVES


                              ----------                              


                      ONE HUNDRED SEVENTH CONGRESS


                WILLIAM M. THOMAS, California, Chairman


                              ----------                              


                    Allison H. Giles, Chief of Staff

    This document was prepared by the staff of the Committee on 
Ways and Means and is issued under the authority of Chairman 
William M. Thomas. This document has not been reviewed or 
officially approved by the Members of the Committee.


                         LETTER OF TRANSMITTAL


                              ----------                              


                                  House of Representatives,
                               Committee on Ways and Means,
                                                     Washington, DC

    Hon. William M. Thomas
    Chairman, Committee on Ways and Means,
    House of Representatives, Washington, DC.

    Dear Mr. Chairman: In 1987, the Committee first published a 
resource document entitled ``Overview and Compilation of U.S. 
Trade Statutes'' for use by Committee Members and interested 
parties in the international trade community. This document was 
unique in that it contained not only an overview of the 
operation of foreign trade statutes, but also an overview of 
the operation of foreign trade statutes, but also an up-to-date 
statutory text of such laws, which integrated numerous separate 
acts of Congress into a single statutory compilation.
    This document was so well received by Members of Congress, 
congressional staff, government officials, the international 
trade community and the general public that an updated version 
was published in 1989 and updated and expanded versions were 
published in 1991, 1993 1995, and 1997. In order to update the 
changes in various trade statutes since the publication of the 
1997 edition, the staff has prepared a new version, 
incorporating all statutory provisions enacted through the 
106th Congress.
    As was the case with the earlier versions, the statutory 
authorities selected are the major provisions of federal law 
which are directly related to the conduct of U.S. international 
trade. The compilation is not meant to be a comprehensive 
treatise of every trade-related law or program, nor does it 
cover provisions to regulate domestic commerce. The laws and 
programs which are within the jurisdiction of the Committee on 
Ways and Means are the main focus of this document and are 
discussed in the greatest detail. In addition, some of the laws 
and programs described may be within the jurisdiction of other 
committees of the House of Representatives. These provisions 
are included in order to provide a complete survey of the 
principal trade authorities.
    The document has been prepared by the Committees' trade 
staff with assistance from the Office of the Legislative 
Counsel and various government agencies, to which the staff 
extends its most sincere thanks.

                                 (III)


                                   IV

    Any suggestions on how to improve this document as a 
reference tool in subsequent editions of this publication are 
always welcome.

            Sincerely yours,

                                             Angela Ellard,
                                          Staff Director & Counsel,
                                              Subcommittee on Trade


                                PREFACE


    The role of Congress in formulating international economic 
policy and regulating international trade in based on a 
specific constitutional grant of power. Article I of the U.S. 
Constitution sets forth the various powers and responsibilities 
of the legislature. Article I, section 8 lists certain specific 
express powers of the Congress. Among these express powers are 
the powers:

        ``to lay and collect taxes, duties, imposts and excises 
        .  .  . [and] to regulate commerce with foreign 
        nations, and among the several states.  .  .  .''

    The Congress therefore is the fundamental authority 
responsible for federal government regulation of international 
transactions. Within the House of Representatives, jurisdiction 
over trade legislation lies in the Committee on Ways and Means, 
based on its jurisdiction over taxes, tariffs, and trade 
agreements, Throughout the history of U.S. trade law and 
policy, the Committee on Ways and Means has been at the 
forefront of its development. The Committee's jurisdiction 
ranges from regulation of tariff affairs, to regulation of non-
tariff trade barriers such as quotas and standards, regulation 
of unfair trade practices such as dumping, subsidization, or 
counterfeiting, provisions of temporary relief from import 
competition and adjustment assistance, providing for bilateral 
and multilateral trade agreements with foreign trading 
partners, and responsibility for authorizing and overseeing the 
departments and agencies charged with implementation of the 
trade laws and programs.
    The difficulties of retaining and exercising full control 
over international trade matters within the legislative branch 
were recognized by Congress shortly after enactment of the 
Smoot-Hawley Tariff Act of 1930. In 1934, the Congress enacted 
the Reciprocal Trade Agreements Act which delegated to the 
President authority to negotiate international trade agreements 
for the reduction of tariffs. This Act, which marked the 
beginning of the trade agreements program for the United 
States, represented the first significant delegation of 
authority from Congress to the President with respect to 
international trade policy.
    Since 1934, the delegation of authority from Congress to 
the President has varied in scope and degree, reflecting 
congressional concern over maintaining careful control of 
international trade policy. When the trade agreements 
negotiating authority granted to the President expired in 1967, 
for example, it was not renewed again until 1974. In the Trade 
Act of 1974, presidential negotiating authority was 
substantially revised, extended to non-tariff as well as tariff 
negotiations, and made subject to specific consultation and 
notification requirements both prior to and during the course 
of negotiation. The Omnibus Trade and Competitiveness Act of 
1988, in addition to providing negotiating authority and 
explicit negotiating

                                  (V)


                                   VI

objectives for the Uruguay Round, expands the consultation 
requirements between the USTR and the Congress and requires the 
formulation of an annual trade policy agenda. Both the Uruguay 
Round Agreements Act and the North American Free Trade 
Agreement Implementation Act provide for the involvement of 
Congress in a number of key trade policy areas. The Trade and 
Development Act of 2000 marks important changes in U.S. 
preferential benefits for the Canbbean Basin and provides such 
benefits for the first time to the nations of sub-Sahanan 
Africa. Finally, legislation in 2000 concerning normal trade 
relations for the People's Republic of China represents the 
congressional views on the accession of this important country 
to the World Trade Organization.
    Due to the central role of Congress in formulating 
international economic policy, an understanding of U.S. 
international trade law and policy must begin with the 
statutory authorities and programs which provide the foundation 
for our trade policy. This document provides two essential 
tools for those interested in obtaining a better understanding 
of U.S. trade law and policy. Part I contains a general 
overview of current provisions of our trade laws. This over 
view was prepared by the staff of the Subcommittee on Trade 
with the assistance of the Congressional Research Service and 
provides a thorough yet understandable explanation of how these 
laws operate. Part II contains a compilation of the actual text 
of these laws, as amended. This updated statutory compilation 
incorporates all major provisions of U.S. trade law and 
includes all amendments to theses laws as of the beginning of 
the 107th Congress. While this integrated text should not be 
treated as a substitute for official public laws or the United 
States Code, it is an accurate and highly useful document which 
integrates numerous separate Acts of Congress into one text. We 
hope this document will prove useful to official policymakers 
as well as the interested public.


                            C O N T E N T S

                              ----------                              
                                                                   Page

Letter of transmittal............................................   iii
Preface..........................................................     v
Subject index....................................................  1171

                            PART I: OVERVIEW

Chapter 1: Tariff and customs laws...............................     1
    Harmonized Tariff Schedule of the United States..............     1
    Generalized System of Preferences (GSP)......................    14
        Title V of the Trade Act of 1974, as amended.............    14
    Caribbean Basin Initiative (CBI).............................    21
    Caribbean Basin Trade Partnership Act........................    22
    Andean Initiative............................................    34
    African Growth and Opportunity Act...........................    37
    Customs valuation............................................    48
        The GATT/WTO Customs Valuation Agreement.................    49
        Current law..............................................    51
    Customs user fees............................................    58
    Other customs laws...........................................    63
        Country-of-origin marking................................    63
        NAFTA rules of origin....................................    66
        Drawback.................................................    67
        Protests and administrative review.......................    69
        Copyrights and trademark enforcement.....................    71
        Penalties................................................    72
        Import prohibitions/restrictions relating to dog and cat 
          fur products...........................................    74
        Commercial operations....................................    75
    Foreign trade zones..........................................    78
Chapter 2: Trade remedy laws.....................................    83
    The antidumping and countervailing duty laws.................    83
        CVD law: subsidy determination...........................    83
        AD law: less-than-fair-value (LTFV) determination........    89
        AD and CVD laws: material injury determination...........    94
        Issues common to AD and CVD investigations...............    95
        Enforcement of U.S. rights under trade agreements and 
          response to certain foreign practices: sections 301-310 
          of the Trade Act of 1974, as amended...................   108
        International consultations and dispute settlement.......   109
        Enforcement authority and procedures (section 301).......   110
        Identification of intellectual property rights priority 
          countries (Special 301)................................   116
        Identification of trade liberalization priorities (Super 
          301)...................................................   123
        Foreign direct investment................................   127
        Foreign anticompetitive practices........................   128
        Unfair practices in import trade (section 337 of the 
          Tariff Act of 1930, as amended)........................   128
        Import relief (safeguard) authorities....................   132
        Sections 201-204 of the Trade Act of 1974, as amended....   132
        Section 406 of the Trade Act of 1974: market disruption 
          by imports from Communist countries....................   139
        Sections 421-423 of the Trade Act of 1974, as amended: 
          market disruption by imports from the People's Republic 
          of China...............................................   140
        Section 1102 of the Trade Agreements Act of 1979: public 
          auction of import licenses.............................   142
    Trade adjustment assistance..................................   142
        Chapters 2, 3, and 5 of title II of the Trade Act of 
          1974, as amended.......................................   142
        TAA program for workers..................................   144
        NAFTA Worker Security Act................................   149
        TAA program for firms....................................   151
Chapter 3: Other laws regulating imports.........................   153
    Authorities to restrict imports of agricultural and textile 
      products...................................................   153
        Section 204 of the Agricultural Act of 1956, as amended..   153
            Multifiber Arrangement (MFA).........................   153
            Uruguay Round Agreement on Textiles and Clothing.....   156
            Bilateral textile agreements.........................   158
        Textiles and apparel trade under the North American Free 
          Trade Agreement........................................   159
        Section 22 of the Agricultural Adjustment Act of 1933....   159
        Agriculture trade under the North American Free Trade 
          Agreement Implementation Act...........................   160
        Agriculture trade under the Uruguay Round Agreements Act.   162
        Meat Import Act of 1979..................................   164
        Reciprocal meat inspection requirement...................   164
        Sugar tariff-rate quotas under Harmonized Tariff Schedule 
          authorities............................................   165
        Import prohibitions on certain agricultural commodities 
          under marketing orders (section 8e of the Agricultural 
          Adjustment Act, as amended)............................   166
    Authorities to restrict imports under certain environmental 
      laws.......................................................   167
        Marine Mammal Protection Act of 1972, as amended.........   167
        International Dolphin Conservation Act of 1992...........   168
        Endangered Species Act of 1973, as amended...............   169
        Tariff Act of 1930, as amended: wild mammals and birds...   169
        Section 8 of the Fishermen's Protective Act of 1967, as 
          amended (``Pelly Amendment'')..........................   170
        High Seas Driftnet Fisheries Enforcement Act.............   170
        Wild Bird Conservation Act of 1992.......................   171
        Atlantic Tunas Convention Act of 1995....................   171
        Conservation of Sea Turtles..............................   172
    National security import restrictions........................   174
        Section 232 of the Trade Expansion Act of 1962...........   174
        Section 233 of the Trade Expansion Act of 1962...........   175
    Balance of payments authority (section 122 of the Trade Act 
      of 1974)...................................................   176
    Product standards............................................   178
        Agreement on Technical Barriers to Trade.................   179
        Uruguay Round Agreement on Technical Barriers to Trade...   181
        The North American Free Trade Agreement..................   182
        Title IV of the Trade Agreements Act of 1979, as amended.   182
    Government procurement.......................................   183
        Buy American Act.........................................   184
        1979 GATT Agreement on Government Procurement............   184
        1994 WTO Agreement on Government Procurement.............   186
        The North American Free Trade Agreement..................   187
        Title III of the Trade Agreements Act of 1979, as amended   188
        Title VII of the Omnibus Trade and Competitiveness Act of 
          1988, as amended.......................................   189
Chapter 4: Laws regulating export activities.....................   195
    Export controls..............................................   195
        Background...............................................   195
        Export Administration Act of 1979........................   196
        Export Administration Amendments Act of 1985.............   198
        Omnibus Trade and Competitiveness Act of 1988............   199
    Export promotion of goods and services.......................   200
        Export Enhancement Act of 1988...........................   200
        Fair Trade in Auto Parts Act of 1988.....................   201
    Agricultural export sales and promotion......................   202
        Public Law 480...........................................   202
        Export credit guarantee and export promotion programs....   202
Chapter 5: Authorities relating to political or economic security   205
    International Emergency Economic Powers Act..................   205
    Trading With the Enemy Act...................................   211
    Narcotics Control Trade Act..................................   214
    The International Security and Development Cooperation Act of 
      1985.......................................................   215
    The Iran and Libya Sanctions Act of 1996.....................   215
    Embargo on transactions with Cuba............................   216
    The Cuban Liberty and Democratic Solidarity Act..............   218
    Iraq Sanctions Act of 1990...................................   220
    Exemptions for food and medicine from U.S. International 
      Trade Sanctions............................................   220
    The Hong Kong Policy Act.....................................   222
    Section 27 of the Merchant Marine Act, 1920 (Jones Act)......   222
    Section 721 of the Defense Production Act of 1950, as amended 
      (``Exon/Florio'')..........................................   223
Chapter 6: Reciprocal trade agreements...........................   225
    Reciprocal trade agreement objectives and authorities........   225
        Trade negotiating objectives.............................   226
        General tariff authority.................................   227
        Multilateral trade agreement authority...................   228
        Bilateral trade agreement authority......................   229
        Reciprocal competitive opportunities.....................   230
        Specific trade agreement authorities.....................   230
        Trade negotiation procedural requirements................   232
    Congressional fast track implementing procedures.............   232
    Uruguay Round Agreements.....................................   235
        Uruguay Round Agreements Act.............................   237
    Specific foreign trade barriers..............................   241
        Sections 181 and 182 of the Trade Act of 1974, as amended   241
        Telecommunications Trade Act of 1988.....................   242
    Normal Trade Relations (nondiscriminatory) treatment.........   246
    North American trade relations...............................   259
        North American Free Trade Agreement......................   260
        North American Free Trade Agreement Implementation Act of 
          1993...................................................   260
    United States-Israel trade relations.........................   261
        Title IV of the Trade and Tariff Act of 1984.............   262
        United States-Israel Free Trade Area Agreement...........   263
        United States-Israel Free Trade Area Implementation Act 
          of 1985................................................   264
        West Bank and Gaza Strip Free Trade Benefits.............   264
    United States-Canada trade relations.........................   265
        United States-Canada Free-Trade Agreement................   266
        United States-Canada Free-Trade Agreement Implementation 
          Act of 1988............................................   267
Chapter 7: Organization of trade policy functions................   269
    Congress.....................................................   269
    Executive branch.............................................   270
        Interagency trade process................................   270
        Office of the U.S. Trade Representative..................   271
        Department of Commerce...................................   273
        U.S. Customs Service.....................................   274
    U.S. International Trade Commission..........................   275
    Private or public sector advisory committees.................   276

              PART II: COMPILATION OF U.S. TRADE STATUTES

Chapter 8: Tariff and customs laws...............................   279
    A. Implementation of the Harmonized Tariff Schedule of the 
      United States..............................................   279
        Sections 1201-1217 of the Omnibus Trade and 
          Competitiveness Act of 1988............................   279
        Section 484(e) of the Tariff Act of 1930, as amended.....   288
    B. Excerpts from the Harmonized Tariff Schedule of the United 
      States (HTS) relating to special duty treatment............   289
        1. American goods returned (HTS item 9801.00.10).........   289
        2. American goods repaired or altered abroad (HTS items 
          9802.00.40, .50).......................................   291
            American metal articles processed abroad (HTS item 
              9802.00.60)........................................   291
            American components assembled abroad (HTS item 
              9802.00.80)........................................   291
        3. Personal (tourist) exemptions (HTS items 9804.00.65, 
          .70, .72)..............................................   296
        4. Noncommercial Importations of Limited Value (HTS items 
          9816.00.20, and 9816.00.40)............................   300
        3. Classification of Personal Effect of Participants in 
          International Athletic Events (HTS items 9817.60.00)...   302
        6. Products of U.S. insular possessions (General Note 
          3(a)(iv))..............................................   304
        7. Rates of duty on certain motor vehicles (General Note 
          3(d))..................................................   305
    C. Generalized System of Preferences.........................   307
        Title V of the Trade Act of 1974, as amended.............   307
        General Note 4 of the Harmonized Tariff Schedule.........   319
    D. Caribbean Basin Initiative (CBI)..........................   321
        Caribbean Basin Economic Recovery Act, as amended........   321
        Caribbean Basin Economic Recovery Expansion Act of 1990..   348
        Section 423 of the Tax Reform Act of 1986, as amended 
          (treatment of imports of ethyl alcohol)................   354
        General Note 7(a) of the Harmonized Tariff Schedule......   358
    E. Andean Initiative (Andean Trade Preference Act, as 
      amended)...................................................   358
    F. African Growth and Opportunity Act........................   367
    G. Customs valuation (Section 402 of the Tariff Act of 1930, 
      as amended)................................................   381
    H. Customs user fees.........................................   389
        Section 13031 of the Consolidated Budget Reconciliation 
          Act of 1985, as amended................................   389
        Sections 111(f), 112, and 113 of the Customs and Trade 
          Act of 1990, as amended................................   402
        Section 1893(f) of the Tax Reform Act of 1986, as amended   403
    I. Other customs laws........................................   403
        1. Country of origin marking.............................   403
            Section 304 of the Tariff Act of 1930, as amended....   403
            Section 1907 (b) and (c) of the Omnibus Trade and 
              Competitiveness Act of 1988........................   410
            Section 210 of the Motor Vehicle Information and Cost 
              Savings Act........................................   411
        2. Drawback (section 313 of the Tariff Act of 1930, as 
          amended)...............................................   415
        3. Entry of merchandise (section 484 of the Tariff Act of 
          1930, as amended)......................................   424
        4. Protests and further administrative reviews...........   429
        5. Copyrights and trademark enforcement..................   435
            Section 101 of the Copyright Revision Act of 1976....   435
            Section 526 of the Tariff Act of 1930, as amended....   436
            Section 431 of the Tariff Act of 1930, as amended....   438
        6. Penalties (sections 592 and 592A of the Tariff Act of 
          1930, as amended)......................................   440
        7. National Customs Automation Program (sections 411-414 
          of the Tariff Act of 1930, as amended).................   452
        8. Commercial operations.................................   456
            Section 9503(c) of the Omnibus Budget Reconciliation 
              Act of 1987........................................   456
            Section 301 of the Customs Procedural Reform and 
              Simplification Act of 1978, as amended.............   456
    J. Foreign Trade Zones (Act of June 18, 1934, as amended)....   459
    K. Implementation of the GATT Agreement on Trade in Civil 
      Aircraft...................................................   468
        Title VI of the Trade Agreements Act of 1979.............   468
        Section 234 of the Trade and Tariff Act of 1984..........   469
        General Note 6 of the Harmonized Tariff Schedule.........   470
Chapter 9: Trade remedy laws.....................................   473
    A. Authorities to respond to foreign subsidy and dumping 
      practices..................................................   473
        1. Countervailing duties.................................   473
            Section 753 of the Tariff Act of 1930, as amended....   473
            Section 261 (a)-(c) of the Uruguay Round Agreements 
              Act................................................   477
            Subtitle A of title VII (sections 701-709) of the 
              Tariff Act of 1930, as amended.....................   478
        2. Antidumping duties (subtitle B of title VII (sections 
          731-739) of the Tariff Act of 1930, as amended)........   501
        3. Administrative review of antidumping and 
          countervailing duties (subtitle C of title VII 
          (sections 751, 752, 761, and 762) of the Tariff Act of 
          1930, as amended)......................................   527
        4. General provisions relating to antidumping and 
          countervailing duties (subtitle D of the VII (sections 
          771-782) of the Tariff Act of 1930, as amended)........   540
        5. Continued dumping and subsidies offset................   597
        6. Judicial and panel review of antidumping and 
          countervailing duty actions............................   600
            Section 516A of the Tariff Act of 1930, as amended...   600
            Section 129 of the Uruguay Round Agreements Act......   613
        7. Third-country dumping (section 1317 of the Omnibus 
          Trade and Competitiveness Act of 1988).................   616
        8. Antidumping petitions by third countries (section 783 
          of the Tariff Act of 1930, as amended).................   617
        9. Antidumping Act of 1916...............................   618
    B. Enforcement of United States rights under trade agreements 
      and response to certain foreign trade practices............   621
        Sections 301-310 of the Trade Act of 1974, as amended....   621
        Sections 281 and 282 of the Uruguay Round Agreements Act, 
          as amended.............................................   637
        Section 307(b) of the Trade and Tariff Act of 1984.......   645
        Foreign air transportation (section 2 of the 
          International Air Transportation Fair Competitiveness 
          Act of 1974, as amended, and the Federal Aviation Act 
          of 1958, as amended)...................................   646
        Section 19 of the Merchant Marine Act of 1920, as amended   648
        Section 10002 of the Foreign Shipping Practices Act of 
          1988...................................................   651
    C. Unfair practices in import trade (section 337 of the 
      Tariff Act of 1930, as amended)............................   654
    D. Safeguard actions (sections 201-204 of the Trade Act of 
      1974, as amended)..........................................   662
    E. Relief from market disruption by imports from Communist 
      countries (section 406 of the Trade Act of 1974, as 
      amended)...................................................   680
    F. Relief from market disruption by imports from the People's 
      Republic of China..........................................   682
    G. Authority to auction import licenses (section 1102 of the 
      Trade Agreements Act of 1979)..............................   691
    H. Trade adjustment assistance (chapters 2, 3, 4, and 5 title 
      II of the Trade Act of 1974, as amended)...................   691
    I. Sections 401 and 408 of the Trade and Development Act of 
      2000.......................................................   724
Chapter 10: Other laws regulation imports........................   727
    A. Authorities to restrict imports of agricultural and 
      textile products...........................................   727
        Section 204 of the Agricultural Act of 1956, as amended..   727
        Section 22 of the Agricultural Adjustment Act of 1933, as 
          amended................................................   727
        Tariff-rate quotas and safeguards (sections 404 and 405 
          of the Uruguay Round Agreements Act)...................   729
        Reciprocal meat inspection requirement (section 20(h) of 
          the Federal Meat Inspection Act).......................   732
        Sugar tariff-rate quotas under headnote authority........   732
        Import prohibitions on certain agricultural commodities 
          under marketing orders (section 8e of the Agricultural 
          Adjustment Act, as amended)............................   736
    B. Authorities to restrict imports under certain 
      environmental laws.........................................   738
        Marine Mammal Protection Act of 1972, as amended 
          (excerpts).............................................   738
        Section 9 of the Endangered Species Act of 1973, as 
          amended................................................   753
        Section 527 of the Tariff Act of 1930, as amended........   757
        Section 8 of the Fishermen's Protective Act of 1967, as 
          amended................................................   762
        High Seas Driftnet Fisheries Enforcement Act (excerpts)..   764
        Sections 105 and 108 of the Wild Bird Conservation Act of 
          1992...................................................   769
        Atlantic Tunas Convention Act of 1975, as amended 
          (excerpts).............................................   771
        Conservation of Sea Turtles..............................   773
    C. National security import restrictions (sections 232 and 
      233 of the Trade Expansion Act of 1962, as amended)........   774
    D. Balance of payments authority (section 122 of the Trade 
      Act of 1974)...............................................   777
    E. Implementation of the GATT Agreement of Technical Barriers 
      to Trade (product standards) (title IV of the Trade 
      Agreements Act of 1979)....................................   780
    F. Government procurement....................................   790
        1. Buy American requirements.............................   790
            Buy American Act (title III of the Act of March 3, 
              1933, as amended)..................................   790
            Section 833 of the Defense Production Act of 1950, as 
              amended............................................   795
            Act of October 29, 1949..............................   795
        2. Implementation of the GATT Agreement on Government 
          Procurement (Title III of the Trade Agreements Act 
          1979, as amended)......................................   796
Chapter 11: Laws regulation export activities....................   811
    A. Export controls...........................................   811
        Export Administration Act of 1979, as amended............   811
    B. Export financing and promotion............................   821
        1. Agriculture export sales and promotion................   821
            Agricultural Trade Development and Assistance Act of 
              1954, as amended (excerpts)........................   821
            Agricultural Trade Act of 1978, as amended (excerpts)   821
            Section 1123 of the Food Security Act of 1985........   826
        2. Export promotion of goods and services................   827
            Sections 2303, 2306, and 2312 of the Export 
              Enhancement Act of 1988, as amended................   827
Chapter 12: Authorities relating to political or economic 
  security.......................................................   833
    A. Economic authorities in national emergencies..............   833
        International Emergency Economic Powers Act, as amended..   833
        Section 5(b) of the Trading With the Enemy Act, as 
          amended................................................   837
    B. Trade sanctions against uncooperative major drug producing 
      or drug-transit countires (Narcotics Control Trade Act)....   839
    C. Economic sanctions against terrorism or missile 
      proliferation..............................................   845
        Sections 504 and 505 of the International Security and 
          Development Cooperation Act of 1985....................   845
        Section 73 of the Arms Export Control Act................   846
    D. Economic sanctions against chemical and biological weapons   848
        Chemical and Biological Weapons Control and Warfare 
          Elimination Act of 1991................................   848
        Section 81 of the Arms Export Control Act................   856
    E. Embargo on trade with Cuba................................   859
        Section 620(a) of the Foreign Assistance Act of 1961, as 
          amended................................................   859
        Cuban Democracy Act of 1992 (title XVII of the National 
          Defense Authorization Act for Fiscal Year 1993)........   860
        Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 
          1996 (excerpts)........................................   867
    F. Economic sanctions against Iraq, Iran, and Libya..........   875
        Iraq Sanctions Act of 1990 (sections 586-586J of the 
          Foreign Assistance and Related Programs Appropriation 
          Act, 1991) (excerpts)..................................   875
        Iran-Iraq Arms Non-Proliferation Act of 1992 (title XVI 
          of the National Defense Authorization Act for Fiscal 
          Year 1993).............................................   880
        Compliance with United Nations sanctions against Iraq....   883
        Iran and Libya Sanctions Act of 1996.....................   884
    G. United States-Hong Kong Policy Act of 1992................   900
    H. Restrictions on transport of merchandise by foreign 
      vessels (section 27 of the Merchant Marine Act, 1920, as 
      amended)...................................................   907
    I. Authority to review certain mergers, acquisitions, and 
      takeovers (section 721 of the Defense Production Act of 
      1950, as amended)..........................................   910
Chapter 13: Reciprocal trade agreements..........................   913
    A. U.S. negotiating objectives...............................   913
        Section 1101 of the Omnibus Trade and Competitiveness Act 
          of 1988................................................   913
        Section 1124 and 3004 of the Omnibus Trade and 
          Competitiveness Act of 1988............................   918
        Sections 131, 132, 135, and 315 of the Uruguay Round 
          Agreements Act, as amended.............................   919
        Section 409 of the Trade and Development Act of 2000.....   922
        Section 108 of the North American Free Trade Agreement 
          Implementation Act.....................................   924
    B. General trade agreement and implementation authorities....   926
        1. ``Fast track'' auhority (expired) (sections 1102, 
          1103, 1105, and 1107 of the Omnibus Trade and 
          Competitiveness Act of 1988, as amended)...............   926
        2. Uruguay Round/WTO implementation, tariff 
          modifications, and dispute settlement (sections 101(a), 
          102, 111(a, c, and e), and 121-130 of the Uruguay Round 
          Agreements Act.........................................   935
    C. Specific trade agreement authorities......................   951
        1. Compensation authority (section 123 of the Trade Act 
          of 1974, as amended)...................................   951
        2. Termination and withdrawal authority (section 125 of 
          the Trade Act of 1974).................................   952
        3. Accession of State trading regimes to the GATT or the 
          WTO (section 1106 of the Omnibus Trade and 
          Competitiveness Act of 1988, as amended)...............   954
        4. GATT and WTO authorizations...........................   955
            Section 121 of the Trade Act of 1974, as amended.....   955
            Section 101(c) of the Uruguay Round Agreements Act...   956
    D. Trade negotiation procedural requirements.................   956
        Sections 131-134 of the Trade Act of 1974, as amended....   956
        Sections 127(a) and (b) of the Trade Act of 1974.........   959
    E. Identification of, and action on, specific foreign trade 
      barriers...................................................   959
        1. National trade estimates report (section 181 of the 
          Trade Act of 1974, as amended).........................   959
        2. Intellectual property rights (section 182 of the Trade 
          Act of 1974, as amended)...............................   961
        3. Telecommunications trade (Telecommunications Trade Act 
          of 1988)...............................................   965
    F. Normal Trade Relations (nondiscriminatory) treatment......   974
        1. NTR principle.........................................   974
            Section 5003 of Public Law 105-206: Clarification of 
              Designation of Normal Trade Relations..............   974
            Section 251 of the Trade Expansion Act of 1962.......   975
            Section 126(a) of the Trade Act of 1974..............   975
            Section 1103(a)(3) of the Omnibus Trade and 
              Competitiveness Act of 1988........................   975
        2. Trade relations with nonmarket economy countries......   976
            General note 3(b) of the Harmonized Tariff Schedule..   976
            Title IV of the Trade Act of 1974, as amended........   976
            Sections 1 and 2 of Public Law 102-182 (NTR treatment 
              for Hungary and Czechoslovakia)....................   982
            Title I of Public Law 102-182 (NTR treatment for 
              Estonia, Latvia, and Lithuania)....................   983
            Section 1 of Public Law 102-420 (NTR withdrawal from 
              Serbia and Montenegro).............................   985
            Public Law 104-162...................................   985
            Public Law 104-171...................................   986
            Public Law 104-203...................................   987
            Section 2424 of Public Law 106-36....................   988
            Sections 301-302 of Public Law 106-200...............   989
            Public Law 106-286...................................   990
            Sections 3001-3002 of Public Law 106-476: Extension 
              of Nondiscriminatory Treatment to Georgia..........  1006
    G. Trade relations with North America (North American Free 
      Trade Agreement Implementation Act, as amended)............  1007
    H. Bilateral trade relations with Israel.....................  1071
        Section 102(b)(1) of the Trade Act of 1974, as amended...  1071
        Title IV of the Trade and Tariff Act of 1984, as amended.  1072
        United States-Israel Free Trade Area Implementation Act 
          of 1985, as amended....................................  1075
    I. Bilateral trade relations with Canada.....................  1081
        United States-Canada Free-Trade Agreement Implementation 
          Act of 1988, as amended................................  1081
        Automotive Products Trade Act of 1965, as amended........  1107
        General note 5 of the Harmonized Tariff Schedule.........  1116
Chapter 14: Organization of trade policy functions...............  1119
    A. Congress..................................................  1119
        1. Congressional advisers (section 161 of the Trade Act 
          of 1974, as amended)...................................  1119
        2. Reports to Congress...................................  1121
            Sections 162 and 163 of the Trade Act of 1974, as 
              amended............................................  1121
            Section 2202 of the Omnibus Trade and Competitiveness 
              Act of 1988........................................  1124
        3. Congressional fast track procedures with respect to 
          presidential actions (sections 151-154 of the Trade Act 
          of 1974, as amended)...................................  1125
        4. Trade agreement implementation authority and amendment 
          procedures.............................................  1133
            Sections 111(b) and 115 of the Uruguay Round 
              Agreements Act.....................................  1133
            Sections 103 and 104 of the North American Free Trade 
              Agreement Implementation Act.......................  1134
            Sections 2(a) and 3(c) of the Trade Agreements Act of 
              1979...............................................  1135
    B. Executive branch..........................................  1137
        1. Interagency trade organization........................  1137
            Section 242 of the Trade Expansion Act of 1962, as 
              amended............................................  1137
            Reorganization Plan No. 3 of 1979....................  1138
            Section 306 of the Trade and Tariff Act of 1984......  1142
        2. Office of the United States Trade Representative 
          (section 141 of the Trade Act of 1974, as amended).....  1144
    C. United States International Trade Commission..............  1149
        1. Organization, general powers, procedures..............  1149
            Sections 330, 331, 333-335, and 339 of the Tariff Act 
              of 1930, as amended................................  1149
            Section 603 of the Trade Act of 1974.................  1156
            Section 175(a)(1) of the Trade Act of 1974...........  1157
        2. Investigations (section 443 of the Tariff Act of 1930, 
          as amended)............................................  1157
    D. Private or public sector advisory committees (section 135 
      of the Trade Act of 1974, as amended)......................  1159

                                APPENDIX

Descriptions of major regional and multilateral trade 
  organizations..................................................  1165
    World Trade Organization (WTO)...............................  1165
    Organization for Economic Cooperation and Development (OECD).  1166
    United Nations Conference on Trade and Development (UNCTAD)..  1166
    World Customs Organization...................................  1167
    European Union (EU)..........................................  1167
    Asia-Pacific Economic Cooperation (APEC).....................  1167
    MERCOSUR.....................................................  1168
    Association of Southeast Asian Nations (ASEAN)...............  1168
    Cairns Group.................................................  1169


                            PART I: OVERVIEW

                              ----------                              


                   Chapter 1: TARIFF AND CUSTOMS LAWS

            Harmonized Tariff Schedule of the United States

Historical background

    The Harmonized Tariff Schedule of the United States (HTS) 
was enacted by subtitle B of title I of the Omnibus Trade and 
Competitiveness Act of 1988 \1\ and became effective on January 
1, 1989.\2\ The HTS replaced the Tariff Schedules of the United 
States (TSUS), enacted as title I of the Tariff Act of 1930 (19 
U.S.C. 1202) by the Tariff Classification Act of 1962; \3\ the 
TSUS had been in effect since August 31, 1963.
---------------------------------------------------------------------------
    \1\ Public Law 100-418, approved August 23, 1988.
    \2\ Presidential Proclamation No. 5911, November 19, 1988.
    \3\ Public Law 87-456, approved May 24, 1962.
---------------------------------------------------------------------------
    The HTS is based upon the internationally adopted 
Harmonized Commodity Description and Coding System (known as 
the Harmonized System or HS) of the Customs Cooperation 
Council. Incorporated into a multilateral convention effective 
as of January 1, 1988, the HS was derived from the earlier 
Customs Cooperation Council Nomenclature, which in turn was a 
new version of the older Brussels Tariff Nomenclature. The HS 
is an up-to-date, detailed nomenclature structure intended to 
be utilized by contracting parties as the basis for their 
tariff, statistical and transport documentation programs.
    The United States did not adopt either of the two previous 
nomenclatures but, because it was a party to the convention 
creating the Council and because of the potential benefits from 
using a modern, widely adopted nomenclature, became involved in 
the technical work to develop the HS. Section 608(c) of the 
Trade Act of 1974 \4\ directed the U.S. International Trade 
Commission (ITC) to investigate the principles and concepts 
which should underlie such an international nomenclature and to 
participate fully in the Council's technical work on the HS. 
The ITC, the U.S. Customs Service (which represents the United 
States at the Council), and other agencies were involved in 
this work through the mid and late 1970's; in 1981, the 
President requested that the ITC prepare a draft conversion of 
the U.S. tariff into the nomenclature format of the HS, even as 
the international efforts to complete the nomenclature 
continued. The Commission's report and converted tariff were 
issued in June 1983. After considerable review and the receipt 
of comments from interested parties, legislation to repeal the 
TSUS and replace it with the HTS was introduced. Following the 
August 23, 1988 enactment of the Omnibus Trade and 
Competitiveness Act, the United States became a party to the HS 
Convention, joining over 75 other major trading partners.
---------------------------------------------------------------------------
    \4\ Public Law 93-618, approved January 3, 1975.
---------------------------------------------------------------------------
Structure of the HTS

    Under the HS Convention, the contracting parties are 
obliged to base their import and export schedules on the HS 
nomenclature, but the rates of duty are set by each contracting 
party. The HS is organized into 21 sections and 96 chapters, 
with accompanying general interpretive rules and legal notes. 
Goods in trade are assigned in the system, in general, to 
categories beginning with crude and natural products and 
continue in further degrees of complexity through advanced 
manufactured goods. These product headings are designated, at 
the broadest coverage level, with 4-digit numerical codes and 
are further subdivided into narrower categories assigned 2 
additional digits. The contracting parties must employ all 4- 
and 6-digit provisions and all international rules and notes 
without deviation; they may also adopt still narrower 
subcategories and additional notes for national purposes, and 
they determine all rates of duty. Thus, a common product 
description and numbering system to the 6-digit level of detail 
exists for all contracting parties, facilitating international 
trade in goods. Two final chapters, 98 and 99, are reserved for 
national use (chapter 77 is reserved for future international 
use).
    The HTS therefore sets forth all the international 
nomenclature through the 6-digit level and, where needed, 
contains added subdivisions assigned 2 more digits, for a total 
of 8 at the tariff-rate line (legal) level. Two final (non-
legal) digits are assigned as statistical reporting numbers 
where further statistical detail is needed (for a total of 10 
digits to be listed on entries). Chapter 98 comprises special 
classification provisions (former TSUS schedule 8), and chapter 
99 (former appendix to the TSUS) contains temporary 
modifications pursuant to legislation or to presidential 
action.
    Each section's chapters contain numerous 4-digit headings 
(which may, when followed by 4 zeroes, serve as U.S duty rate 
lines) and 6- and 8-digit subheadings. Additional U.S. notes 
may appear after HS notes in a chapter or section. Most of the 
general headnotes of the former TSUS appear as general notes to 
the HTS set forth before chapter 1, along with notes covering 
more recent trade programs (and the non-legal statistical 
notes). These notes contain definitions or rules on the scope 
of the pertinent provisions, or set additional requirements for 
classification purposes. In addition, the HTS contains a table 
of contents, an index, footnotes, and other administrative 
material, which are provided for ease of reference and, along 
with the statistical reporting provisions, have no legal 
significance or effect.
    The HTS is not published as a part of the statutes and 
regulations of the United States but is instead subsumed in a 
document produced and updated regularly by the ITC entitled 
``Harmonized Tariff Schedule of the United States: Annotated 
for Statistical Reporting Purposes.'' Changes in the TSUS 
became so frequent and voluminous that its inclusion in title 
19 of the United States Code effectively ceased with the 1979 
supplement to the 1976 edition. The Commission is charged by 
section 1207 of the 1988 Omnibus Trade and Competitiveness Act 
(19 U.S.C. 3007) with the responsibility of compiling and 
publishing, ``at appropriate intervals,'' and keeping up to 
date the HTS and any related materials. The initial document 
appeared as USITC Publication 2030. That document, and 
subsequent issuances, have included both the current legal text 
of the HTS and all statistical provisions adopted under section 
484(f) of the Tariff Act of 1930 (19 U.S.C. 1484(f)). It is 
presented as a looseleaf publication so that pages being issued 
in supplements to modify the schedule's basic edition for any 
year edition may be inserted as replacements. Two or more 
supplements may appear between the publication of each basic 
edition.
    Unlike the TSUS, which applied exclusively to imported 
goods, the HTS can, for almost all goods, be used to document 
both imports and exports. The small number of exceptions 
enumerated before chapter 1 require particular exports to be 
reported under schedule B provisions. That schedule, which 
prior to 1989 served as the means of reporting all exports, has 
been converted to the HS nomenclature structure. For certain 
goods that are significant U.S. exports, variations in the 
desired product description and detail compel the use of 
schedule B reporting provisions that cannot be accommodated in 
the HTS under the international nomenclature structure.
    The HTS, like its predecessor the TSUS, is presented in a 
tabular format containing 7 columns, each with a particular 
type of information. A sample page of the HTS is set forth on 
the next page.

                                                 HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES (1997)
                                                      Annotated for Statistical Reporting Purposes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
7213                       Bars and rods, hot-rolled,                                              ..........................
                            in irregularly wound
                            coils, of iron or non
                            alloy steel:
7213.10.00             00    Concrete reinforcing      kg............  3.4%                        Free (E,IL,J)               20%
                              bars and rods..........                                              0.4% (CA)
                                                                                                   2.9% (MX)
7213.20.00             00    Other, of free-cutting    kg............  1.3%                        Free (E,IL,J)               5.5%
                              steel..................                                              0.1% (CA)
                                                                                                   1.1% (MX)
                             Other:..................
7213.91                       Of circular cross                                                    ..........................
                               section measuring less
                               than 14 mm in
                               diameter:
7213.91.30             00      Not tempered, not       kg............  1.3%                        Free (E,IL,J)               5.5%
                                treated and not                                                    0.1% (CA)
                                partly manufactured..                                              1.1% (MX)
                               Other:
7213.91.45             00       Containing by weight   kg............  1.3%                        Free (E,IL,J)               5.5%
                                 0.6 percent or more                                               0.1% (CA)
                                 of carbon...........                                              1.1% (MX)
7213.91.60             00       Other................  kg............  1.6%                        Free (E,IL,J)               6%
                                                                                                   0.2% (CA)
                                                                                                   1.3% (MX)
7213.99.00                    Other..................  ..............  1.3%                        Free (E,IL,J)               5.5%
                                                                                                   0.1% (CA)
                                                                                                   1.1% (MX)
                       30      Of circular cross
                                section:
                                With a diameter of 14  kg
                                 mm or more but less
                                 than 19 mm..........

                       60       With a diameter of 19  kg
                                 mm or more..........
                       90      Other.................  kg
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The  first  column,  entitled  ``Heading/subheading,''  
sets  forth  the 4-, 6-, or 8-digit number assigned to the 
class of goods described to its right. It should be recalled 
that 8-digit-level provisions bear the only numerical codes at 
the legal level which are determined solely by the United 
States, because the 4- and 6-digit designators are part of the 
international convention.
    The second column is labeled ``Stat. suffix,'' meaning 
statistical suffix. Wherever a tariff rate line is annotated to 
permit collection of trade data on narrower classes of 
merchandise, the provisions adopted administratively by an 
interagency committee under section 484(f) of the 1930 Act (19 
U.S.C. 1484(f)) are given 2 more digits which must be included 
on the entry filed with customs officials. Where no annotations 
exist, 2 additional zeroes are added to the 8-digit legal code 
applicable to the goods in question. The goods falling in all 
10-digit statistical reporting numbers of a particular 8-digit 
legal provision receive the same duty treatment.
    The third column, ``Article description,'' contains the 
detailed description of the goods falling within each tariff 
provision and statistical reporting number.
    In the fourth column, ``Units of quantity,'' the unit of 
measure in which the goods in question are to be reported for 
statistical purposes is set forth. These units are 
administratively determined under section 484(f) of the Tariff 
Act of 1930. In many instances, the unit of quantity is also 
the basis for the assessment of the duty. For many categories 
of products, two or three different figures in different units 
must be reported (e.g., for some textiles, weight and square 
meters; for some apparel, the number of garments, value, and 
weight), with the second unit of quantity frequently being the 
basis for administering a measure regulating imports, such as a 
quota. If an ``X'' appears in this column, only the value of 
the shipment must be reported.
    The remaining columns appear under the common heading 
``Rates of duty'' and are designated as column 1 (subdivided 
into ``General'' and ``Special'' subcolumns) and column 2. 
These columns contain the various rates of duty that apply to 
the goods of the pertinent legal provision, depending on the 
source of the goods and other criteria. Their application to 
goods originating in particular countries is discussed below 
under the heading ``Applicable duty treatment.''
    A rate of duty generally has one of three forms: ad 
valorem, specific or compound. An ad valorem rate of duty is 
expressed in terms of a percentage to be assessed upon the 
customs value of the goods in question. A specific rate is 
expressed in terms of a stated amount payable on some quantity 
of the imported goods, such as 17 cents per kilogram. Compound 
duty rates combine both ad valorem and specific components 
(such as 5 percent ad valorem plus 17 cents per kilogram).
    Chapter 98 comprises special classification provisions 
permitting, in specified circumstances, duty-free entry or 
partial duty-free entry of goods which would otherwise be 
subject to duty. The article descriptions in the provisions of 
this chapter enunciate the circumstances in which goods are 
eligible for this duty treatment. Some of the goods eligible 
for such duty treatment include: articles reimported after 
having been exported from the United States; goods subject to 
personal exemptions (such as those for returning U.S. 
residents); government importations; goods for religious, 
educational, scientific, or other qualifying institutions; 
samples; and, articles admitted under bond.
    Chapter 99 contains temporary modifications of the duty 
treatment of specified articles in the other chapters. 
Additional duties and suspensions or reductions of duties 
enacted by Congress are included, as are temporary 
modifications (increases or decreases in duty rates) and import 
restrictions (quotas, import fees, and so forth) proclaimed by 
the President under trade agreements or pursuant to 
legislation. Separate subchapters contain temporary special 
duty treatment for certain goods of Canada or of Mexico 
pursuant to the NAFTA. However, antidumping and countervailing 
duties imposed under the authority of the Tariff Act of 1930, 
as amended, are not included. These duties are announced in the 
Federal Register.

Applicable duty treatment

    Column 1--General.--The rates of duty appearing in the 
``General'' subcolumn of column 1 of the HTS are imposed on 
products of countries that have been extended most-favored-
nation (MFN) or non-discriminatory trade treatment by the 
United States, unless such imports are claimed to be eligible 
for treatment under one of the preferential tariff schemes 
discussed below. The general duty rates are concessional and 
have been set through reductions of full statutory rates in 
negotiations with other countries, generally under the GATT.
    Column 1--Special.--General Note 3 to the HTS sets forth 
the special tariff treatment afforded to covered products of 
designated countries or under specified measures. These 
programs and the corresponding symbols by which they are 
indicated in the ``Special'' subcolumn along with the 
appropriate rates of duty are as follows:

    Generalized System of Preferences [GSP]  A or A*
    Automotive Products Trade Act [APTA]...  B
    Agreement on Trade in Civil Aircraft     C
     [ATCA].
    North American Free Trade Agreement:...
      Goods of Canada......................  CA
      Goods of Mexico......................  MX
    Caribbean Basin Economic Recovery Act    E or E*
     [CBERA].
    United States-Israel Free Trade Area...  IL
    Andean Trade Preference Act [ATPA].....  J or J*


The presence of one or more of these symbols indicates the 
eligibility of the described articles under the respective 
program. In the case of the GSP (when in effect), a symbol 
followed by an asterisk indicates that, although the described 
articles are generally eligible for duty-free entry, such 
tariff treatment does not apply to products of the designated 
beneficiary countries specified in General Note 4(d). In the 
case of CBERA and the ATPA, the asterisk indicates that some of 
the described articles are ineligible for duty-free entry. 
These programs are discussed in greater detail below.
    Column 2.--The column 2 rates of duty apply to products of 
countries that have been denied MFN status by the United States 
(see General Note 3(b)); these rates are the full statutory 
rates, generally as enacted by the Tariff Act of 1930. (See 
separate description of most-favored-nation treatment and HTS 
General Note 3(b) for a list of countries subject to column 2 
rates of duty.)

Special duty exemptions and preferences

    Certain notable provisions in chapter 98 of the HTS grant 
duty-free entry to various categories of American goods 
returned from abroad and allow U.S. tourists to import foreign 
articles free of duty. Other provisions in the general notes of 
the HTS provide duty-free entry to imports from the U.S. 
insular possessions, to imports of Canadian auto products under 
the Automotive Products Trade Act, and to articles imported for 
use in civil aircraft under the Agreement on Trade in Civil 
Aircraft.
    American goods returned (HTS subheading 9801.00.10).--
American goods not advanced or improved abroad may be returned 
to the United States free of duty under HTS subheading 
9801.00.10. The courts have interpreted this provision to allow 
duty-free entry of American goods which had been exported for 
sorting, separating (e.g., by grade, color, size, etc.), 
culling out, and discarding defective items and repackaging in 
certain containers, so long as the goods themselves were not 
advanced in value or improved in condition while abroad.
    American goods repaired or altered abroad (HTS subheading 
9802.00.40).--HTS subheading 9802.00.40 provides that goods 
exported from the United States for repairs or alterations 
abroad are subject to duty upon their reimportation into the 
United States (at the duty rate applicable to the imported 
article) only upon the value of such repairs or alterations. 
The provision applies to processing such as restoration, 
renovation, adjustment, cleaning, correction of manufacturing 
defects, or similar treatment that changes the condition of the 
exported article but does not change its essential character. 
The value of the repairs or processing for purposes of 
assessing duties is generally determined, in accordance with 
U.S. note 3 to subchapter II of chapter 98, by--
          (1) the cost of the repairs or alterations to the 
        importer; or
          (2) if no charge is made, the value of the repairs or 
        alterations, as set out in the customs entry.
However, if the customs officer finds that the amount shown in 
the entry document is not reasonable, the value of the repairs 
or alterations will be determined in accordance with the 
valuation standards set out in section 402 of the Tariff Act of 
1930, as amended.\5\
---------------------------------------------------------------------------
    \5\ 19 U.S.C. 1401a.
---------------------------------------------------------------------------
    American metal articles processed abroad (HTS subheading 
9802.00.60).--HTS subheading 9802.00.60 provides that an 
article of metal (except precious metal) which is exported from 
the United States for processing abroad may be subject to duty 
on the value of the processing only upon its return to the 
United States. To qualify for this duty treatment, the exported 
article (1) must have been manufactured or subjected to a 
process of manufacture in the United States; and (2) must be 
returned ``for further processing'' in the United States.
    The term ``processing'' refers to such operations as 
melting, molding, casting, machining, grinding, drilling, 
tapping, threading, cutting, punching, rolling, forming, 
plating, and galvanizing.
    As in the case of articles imported under subheading 
9802.00.40 (repairs or alterations), discussed above, the duty 
on metal articles processed abroad is assessed against the 
value of such processing, determined in accordance with U.S. 
note 3 to subchapter II of chapter 98.
    American components assembled abroad (HTS subheading 
9802.00.80).--Articles assembled abroad from American-made 
components may be exempt from duty on the value of such 
components when the assembled article is imported into the 
United States under HTS subheading 9802.00.80. This provision 
enables American manufacturers of relatively labor-intensive 
products to take advantage of low-cost labor and fiscal 
incentives in other countries by exporting American parts for 
assembly in such countries and returning the assembled products 
to the United States, with partial exemption from U.S. duties.
    Subheading 9802.00.80 applies to articles assembled abroad 
in whole or in part of fabricated components, the product of 
the United States, which--
          (1) were exported in condition ready for assembly 
        without further fabrication;
          (2) have not lost their physical identity in such 
        articles by change in form, shape, or otherwise; and
          (3) have not been advanced in value or improved in 
        condition abroad except by being assembled and by 
        operations incidental to the assembly process such as 
        cleaning, lubricating, and painting.
    The exported articles used in the imported goods must be 
fabricated U.S. components, i.e., U.S.-manufactured articles 
ready for assembly in their exported condition, except for 
operations incidental to the assembly process. Integrated 
circuits, compressors, zippers, and precut sections of a 
garment are examples of fabricated components, but uncut bolts 
of cloth, lumber, sheet metal, leather, and other materials 
exported in basic shapes and forms are not considered to be 
fabricated components for this purpose.
    To be considered U.S. components, the exported articles do 
not necessarily need to be fabricated from articles or 
materials wholly produced in the United States. If a foreign 
article or material undergoes a manufacturing process in the 
United States resulting in its ``substantial transformation'' 
into a new and different article, then the component that 
emerges may qualify as an exported product of the United States 
for purposes of subheading 9802.00.80.
    The assembly operations performed abroad can involve any 
method used to join solid components together, such as welding, 
soldering, gluing, sewing, or fastening with nuts and bolts. 
Mixing, blending, or otherwise combining liquids, gases, 
chemicals, food ingredients, and amorphous solids with each 
other or with solid components is not regarded as 
``assembling'' for purposes of subheading 9802.00.80.
    The rate of duty that applies to the dutiable portion of an 
assembled article is the same rate that would apply to the 
imported article. The assembled article is also treated as 
being entirely of foreign origin for purposes of any import 
quota or similar restriction applicable to that class of 
merchandise, and for purposes of country-of-origin marking 
requirements. All requirements regarding labeling, radiation 
standards, flame retarding properties, etc., that apply to 
imported products apply equally to subheading 9802.00.80 
merchandise.
    An article imported under subheading 9802.00.80 is treated 
as a foreign article for appraisement purposes. That is, the 
full appraised value of the article must first be determined 
under the usual appraisement provisions. The dutiable value, 
however, is determined by deducting the cost or value of the 
American-made fabricated components from the appraised value of 
the assembled merchandise entered under subheading 9802.00.80.
    Personal (tourist) exemption.--Subchapter IV of chapter 98 
of the HTS sets forth various personal exemptions for residents 
and non-residents that arrive in the United States from abroad. 
The relevant customs regulations are set forth at 19 CFR 148 et 
seq. In particular, HTS subheading 9804.00.65 provides that 
U.S. residents returning from a journey abroad may import up to 
400 dollars' worth of articles free of duty. The articles must 
be for personal or household use and may include not more than 
1 liter of alcoholic beverages, not more than 200 cigarettes 
and not more than 100 cigars.
    The technical amendment to the Balanced Budget Act of 1997 
(Public Law 105-277) inadvertently removed the personal 
exemption relating to domestically produced cigarettes re-
imported into the United States. As a result, travelers 
bringing cigarettes puchased outside the United States did not 
receive the personal exemption for these cigarettes (i.e., they 
were not permitted to bring these cigarettes into the United 
States). Section 4003 of the Tariff Suspension and Trade Act of 
2000 (Public Law 106-476) re-instated that exemption.
    Special rules provide increased duty-free allowances for 
U.S. residents returning from U.S. insular possessions or from 
beneficiary countries under the Caribbean Basin Economic 
Recovery Act (CBERA) and under the Andean Trade Preference Act 
(ATPA). An increased duty-free allowance of $1200 is provided 
under HTS subheading 9804.00.70 for U.S. residents returning 
from the U.S. insular possessions, and an increased duty-free 
allowance of $600 is provided under HTS subheading 9804.00.72 
for U.S. residents returning from beneficiary countries under 
the CBERA and the ATPA. U.S. note 3 to chapter 98 provides 
that, in addition to being exempt from customs duty, all such 
articles are exempt from any internal revenue taxes as well.
    The Tariff Suspension and Trade Act of 2000 (Public Law 
106-476) provides for staged reductions of duty rates 
applicable to merchandise accompanying persons entering the 
United States, and merchandise from American Samoa, Guam, or 
the U.S. Virgin Islands. Purchases for personal and household 
use accompanying the returning traveler in excess of the $400 
duty-free allowance had been subject to flat rate of duty of 10 
percent, if the person claiming the benefit had not received 
the benefit within the past thirty days. In addition, non-
commercial importations from U.S. insular possessions exceeding 
$1200 (American Samoa, Guam, or the U.S. Virgin Islands) were 
subject to a 5 percent rate of duty. This legislation provides 
a staged reduction of the 10 percent duty-rate as follows: 5 
percent effective January 1, 2000, 4 percent effective January 
1, 2001, and 3 percent effective January 1, 2002. The 
legislation also provides a staged reduction of the 5 percent 
rate of duty for articles imported from American Samoa, Guam, 
or the U.S. Virgin Islands as follows: 3 percent effective 
January 1, 2000, 2 percent effective January 1, 2001, and 1.5 
percent effective January 1, 2002.
    The Miscellaneous Trade and Technical Corrections Act of 
1996 (Public Law 104-295) amended the exemption from duty for 
personal and household goods accompanying returning U.S. 
residents. Section 321(a)(2)(B) of the Tariff Act of 1930 
originally applied to returning residents arriving from foreign 
countries other than the insular possessions. Due to a split in 
tariff classification numbers, the tariff numbers applicable to 
residents returning from a foreign country were inadvertently 
dropped. The Miscellaneous Trade and Technical Corrections Act 
of 1996 restored HTS number 9804.00.65 to correct the error and 
allow the Customs Service to apply administrative exemptions 
from duty for personal and household goods of returning 
residents arriving from foreign countries other than insular 
possessions. It ensures that U.S. residents returning from 
foreign countries other than insular possessions are entitled 
to bring articles for personal or household use free of duty, 
if such articles are valued at not more than $400. The 
provision was made retroactive to December 8, 1993, the date on 
which the customs provisions within the NAFTA (Public Law 103-
182) became law.
    In addition, the Miscellaneous Trade and Technical 
Corrections Act of 1996 (Public Law 104-295) amended the 
personal allowance exemption for merchandise purchased in duty-
free sales enterprises. Previously, under section 555(b)(6) of 
the Tariff Act of 1930 (19 U.S.C. 1555(b)(6)), merchandise 
purchased in duty-free sales enterprises which was brought back 
to U.S. customs territory was not eligible for a duty-free 
exemption under the personal allowance exemption for returning 
U.S. residents. The Miscellaneous Trade and Technical 
Corrections Act of 1996 amended section 555(b)(6) to make 
merchandise purchased by returning U.S. residents in duty-free 
enterprises eligible for a duty-free exemption under HTS 
subheadings 9804.00.65, 9804.00.70, and 9804.00.72, if the 
person meets the eligibility requirements of the exemption. 
This provision does not apply in the case of travel involving 
transit to, from, or through an insular possession of the 
United States.
    Duty-free treatment for personal effects of participants in 
international sporting events.--The Miscellaneous Trade and 
Technical Corrections Act of 1999 (Public Law 106-36) extended 
until December 2002 duty-free treatment for the personal 
effects of participants in, officials of, and accredited 
members of delegations to certain international athletic events 
held in the United States provided that these items are not 
intended for sale or distribution in the United States. The 
provision also exempted the articles covered under this 
provision from taxes and fees and gave the Secretary of the 
Treasury discretion to determine which athletic events, 
articles, and persons are covered under this provision. The 
Tariff Suspension and Trade Act of 2000 (Public Law 106-476) 
made this exemption permanent under new HTS subheading 
9817.60.00.
    Products of U.S. insular possessions (General Note 
3(a)(iv)).--Imports from the Virgin Islands, Guam, American 
Samoa, Wake Island, Kingman Reef, Johnson Island, and Midway 
Islands are entitled to duty-free entry under certain 
conditions, designed to promote the economic development of 
these U.S. insular possessions. This provision does not apply 
to Puerto Rico, which is part of the ``customs territory of the 
United States.''
    As provided in General Note 3(a)(iv) of the HTS, an article 
imported directly from a possession is exempt from duty if--
          (1) it was grown or mined in the possession;
          (2) it was produced or manufactured in the 
        possession, and the value of foreign materials 
        contained in that article does not exceed 70 percent of 
        its total value. Materials of U.S. origin are not 
        considered foreign for this purpose. Likewise, 
        materials that could be imported into the United States 
        duty free (except from Cuba or the Philippines) are not 
        counted as foreign materials for purposes of the 70 
        percent foreign-content limitation; or
          (3) in the case of any article excluded from duty-
        free entry under section 213(b) of the Caribbean Basin 
        Economic Recovery Act, it was produced or manufactured 
        in the possession, and the value of foreign materials 
        does not exceed 50 percent of its total value.
    In addition, an article previously imported into the United 
States with duty or tax paid thereon, shipped to a possession 
without benefit of remission, refund, or drawback of such duty 
or tax, may be returned to the United States duty free. General 
Note 3(a)(iv) also provides that articles from insular 
possessions are entitled to no less favorable duty treatment 
than that accorded to eligible articles under the Generalized 
System of Preferences and the Caribbean Basin Initiative 
described below.
    In applying the 70 percent foreign-materials test, Customs 
determines the value of the foreign materials by their actual 
purchase price, plus the transportation cost to the possession, 
excluding any duties or taxes assessed by the possession and 
excluding any post-landing charges. The value thus determined 
is then compared with the appraised value of the products 
imported into the United States, determined in accordance with 
the usual appraisement methods. If the differential is 30 
percent or more, the foreign materials limitation is satisfied. 
This procedure is set out in 19 C.F.R. 7.8(d).
    As previously noted, the product imported from a possession 
must have been produced or manufactured there (unless grown or 
mined there). It is not sufficient for foreign goods to be 
shipped to a possession for nominal handling or manipulation, 
followed by a price mark-up to meet the 70 percent test.
    Extension of United States Insular Possession Program.--The 
Miscellaneous Trade and Technical Corrections Act of 1999 
(Public Law 106-36) (the Act) amended the U.S. notes to Chapter 
71 by adding an additional U.S. Note 3. This amendment extends 
to certain fine jewelry the same trade benefits enjoyed by 
watch makers in U.S. insular possessions under the Production 
Incentive Certificate (PIC) program. U.S. Note 5 allows 
producers of watches located in U.S. insular possessions to 
benefit from the PIC system, which permits watch producers to 
import specified quantities of watches, watch movements, and 
watch parts. The benefits provided under Note 5 are based on 
the amount of wages paid to produce such watches in insular 
possessions. New Note 3(a) permits the inclusion of wages paid 
for jewelry production in the insular possessions as an offset 
to duties paid on watches, watch movements, and watch parts 
imported into the United States. Note 3(b) provides that the 
extension of Note 5 benefits to jewelry may not result in any 
increase in the authorized amount to benefits established by 
Note 5, and Note 3 (c) prohibits diminishing of benefits that 
had been available to watch poducers under paragraph (h)(iv) of 
Note 5 to Chapter 91.
    Canadian motor vehicles and original equipment entry 
pursuant to the Automotive Products Trade Act of 1965 (APTA) 
(General Note 5).--Throughout the HTS there are a number of 
specific provisions which provide for duty-free entry of 
imported motor vehicles and specified original equipment parts 
that qualify as ``Canadian articles'' under General Note 5. 
These provisions were added to the HTS pursuant to the 
Automotive Products Trade Act of 1965,\6\ which was enacted to 
implement the U.S.-Canadian Automotive Agreement. The purpose 
of the Agreement was to create a North American common market 
for motor vehicles and original equipment parts (replacement 
parts are not covered).
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    \6\ Public Law 89-283, 19 U.S.C. 2001, et seq.
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    The term ``Canadian article'' refers to an article produced 
in Canada but does not include any article produced with non-
Canadian or non-U.S. materials unless the article satisfies the 
criteria set forth in the NAFTA (General Note 12).
    Most of the product categories established by the APTA are 
applicable to ``original motor-vehicle equipment,'' which is 
defined in General Note 5(a)(ii) as a Canadian fabricated 
component intended for use as original equipment in the 
manufacture of a motor vehicle in the United States and which 
was obtained from a Canadian supplier pursuant to ``a written 
order, contract, or letter of intent of a bona fide motor-
vehicle manufacturer in the United States.'' The phrase ``bona 
fide motor-vehicle manufacturer'' is defined as a person 
determined by the Secretary of Commerce to have produced at 
least 15 motor vehicles in the previous 12 months and to have 
the capacity to produce at least 10 motor vehicles per week.
    Civil aircraft products (ATCA) (General Note 6).--Title VI 
of the Trade Agreements Act of 1979 gave the President the 
authority to proclaim new headnote 3 to part 6C of schedule 6; 
to make specific headnotes to designated TSUS items in order to 
implement the Tokyo Round Agreement on Trade in Civil Aircraft; 
and to provide duty-free treatment, in accordance with the 
annex to the Agreement for the civil aircraft articles 
described therein. These changes were implemented by 
Presidential Proclamation 4707 of December 11, 1979. This duty 
treatment is continued in the ``Special'' rates subcolumn of 
the HTS.
    The provisions work much like those implementing the APTA 
in that a number of specific product breakouts are spread 
throughout the HTS providing duty-free entry to specifically 
described articles which are ``certified for use in civil 
aircraft'' in accordance with General Note 6.
    Section 234 of the Trade and Tariff Act of 1984 enacted on 
October 30, 1984, gave the President the authority to make 
additional tariff breakouts in designated TSUS items in order 
to provide duty-free coverage comparable to the expanded 
coverage provided by all other signatories to the Aircraft 
Agreement pursuant to the extension of the annex to the 
Agreement agreed to in Geneva on October 6, 1983. This duty 
treatment has been continued in the ``Special'' rates subcolumn 
of the HTS for the relevant articles.
    The Miscellaneous Trade and Technical Corrections Act of 
1996 (Public Law 104-295) significantly amended General Note 6. 
The note now requires importers of duty-free civil aircraft 
parts to maintain such supporting documentation as the 
Secretary of the Treasury may require. Importers must also 
certify that the imported article is a civil aircraft, or has 
been imported for use in a civil aircraft and will be so used. 
The importer may amend the entry or file a written statement to 
claim duty-free treatment under General Note 6 at any time 
before the liquidation of the entry becomes final, except that 
any refund resulting from any such claim shall be without 
interest.
    The amendment to General Note 6 also changed the definition 
of ``civil aircraft'' to mean any aircraft, aircraft engine, or 
ground flight simulator (including parts, components, and 
subassemblies thereof):
          (A) that is used as original or replacement equipment 
        in the design, development, testing, evaluation, 
        manufacture, repair, maintenance, rebuilding, 
        modification, or conversion of aircraft; and
          (B)(1) that is manufactured or operated pursuant to a 
        certificate issued by the Federal Aviation 
        Administration (FAA), or pursuant to the approval of 
        the airworthiness authority in the country of 
        exportation, if such approval is recognized by the FAA 
        as an acceptable substitute for an FAA certificate;
          (2) for which an application for such certificate has 
        been submitted to, and accepted by, the FAA by an 
        existing type and production certificate holder; or
          (3) for which an application for such approval or 
        certificate will be submitted in the future by an 
        existing type and production certificate holder, 
        pending the completion of design or other technical 
        requirements stipulated by the FAA. This section 
        applies only to quantities of parts, components, and 
        subassemblies as are required to meet the design and 
        technical requirements stipulated by the FAA. The 
        Commissioner of Customs may also require the importer 
        to estimate the quantities of parts, components, and 
        subassemblies covered under this section.
The term ``civil aircraft'' does not include any aircraft, 
aircraft engine, or ground flight simulator purchased for use 
by the Department of Defense or the U.S. Coast Guard, unless 
such aircraft, aircraft engine, or ground flight simulator 
satisfies the requirements outlined above.

                Generalized System of Preferences (GSP)

              TITLE V OF THE TRADE ACT OF 1974, AS AMENDED

    The concept of a Generalized System of Preferences (GSP) 
was first introduced in the United Nations Conference on Trade 
and Development (UNCTAD) in 1964. Developing countries (LDCs) 
asserted that one of the major impediments to accelerated 
economic growth and development was their inability to compete 
on an equal basis with developed countries in the international 
trading system. Through tariff preferences in developed country 
markets, the LDCs claimed they could increase exports and 
foreign exchange earnings needed to diversify their economies 
and reduce dependence on foreign aid.
    After several international meetings and long internal 
debate, in 1968 the United States joined other industrialized 
countries in supporting the concept of GSP. As initially 
conceived, GSP systems were to be (1) temporary, unilateral 
grants of preferences by developed to developing countries; (2) 
designed to extend benefits to sectors of developing country 
economies which were not competitive internationally; and (3) 
designed to include safeguard mechanisms to protect domestic 
industries sensitive to import competition from articles 
receiving preferential tariff treatment. In the early 1970's, 
19 other members of the Organization for Economic Cooperation 
and Development (OECD) also instituted and have since renewed 
GSP schemes.
    In order to implement their GSP systems, the developed 
countries obtained a waiver from the most-favored-nation (MFN) 
obligation of article I of the General Agreement on Tariffs and 
Trade (GATT), which provides that trade must be conducted among 
countries on a non-discriminatory basis. A 10-year MFN waiver 
was granted in June 1971 and was made permanent in 1979 through 
the ``enabling clause'' of the Texts Concerning a Framework for 
the Conduct of World Trade concluded in the Tokyo Round of GATT 
multilateral trade negotiations. The enabling clause, which has 
no expiration date, provides the legal basis for ``special and 
differential treatment'' for developing countries. The enabling 
clause also requires that developing countries accept the 
principle of graduation, under which such countries agree to 
assume ``increased GATT responsibilities as their economies 
progress.''

U.S. GSP basic authority

    Statutory authority for the U.S. Generalized System of 
Preferences program is set forth in title V of the Trade Act of 
1974, as amended.\7\ Authority to grant GSP duty-free treatment 
on eligible articles from beneficiary developing countries 
(BDCs) became effective under that Act on January 3, 1975, for 
a 10-year period expiring on January 3, 1985. The program was 
actually implemented on January 1, 1976 under Executive Order 
11888. Relatively minor amendments to the statute were made 
under section 1802 of the Tax Reform Act of 1976 \8\ and 
section 1111 of the Trade Agreements Act of 1979.\9\ Title V of 
the Trade and Tariff Act of 1984 \10\ renewed the GSP program 
for 8\1/2\ years until July 4, 1993, with significant 
amendments effective on January 4, 1985, particularly with 
respect to the criteria for designating beneficiary countries 
and limitations on duty-free treatment.
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    \7\ Public Law 93-618, approved January 3, 1975.
    \8\ Public Law 94-455, approved October 4, 1976.
    \9\ Public Law 96-39, approved July 26, 1979.
    \10\ Public Law 98-573, title V, approved October 30, 1984.
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    The GSP program was extended without amendment for 15 
months, until September 30, 1994, by section 13802 of the 
Omnibus Budget Reconciliation Act of 1993.\11\ The program was 
again extended without amendment for 10 months, until July 31, 
1995, by section 601 of the Uruguay Round Agreements Act.\12\
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    \11\ Public Law 103-66, approved August 10, 1993.
    \12\ Public Law 103-465, approved December 8, 1994.
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    Subtitle J of title I of the Small Business Jobs Protection 
Act of 1996 renewed the GSP program for 1 year and 10 months, 
through May 31, 1997, with amendments effective October 1, 
1996. This law also revised and reorganized title V.\13\ An 
additional technical change was made by the Miscellaneous Trade 
and Technical Corrections Act of 1996.\14\ Section 1011 of the 
Omnibus Appropriations Bill for Fiscal Year 1999 (Public Law 
105-277) extended to program through June 30, 1999, and section 
508 of the Ticket to Work and Work Incentives Improvement Act 
of 1999 (Public Law 106-170) extended it through September 30, 
2001. The Africa Growth and Opportunity Act, signed into law by 
the President on May 18, 2000 (Public Law 106-200) extended 
regular and enhanced GSP benefits through September 30, 2008, 
for eligible countries in sub-Saharan Africa.
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    \13\ Public Law 104-188, approved August 20, 1996.
    \14\ Public Law 104-295, approved October 11, 1996.
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    The U.S. Trade Representative (USTR) administers the GSP 
program and makes recommendations to the President through an 
interagency committee that conducts annual reviews under 
regulatory procedures of petitions by interested parties and 
self-initiated actions to add or remove GSP eligibility for 
individual products or countries.
    Section 501 of the Trade Act of 1974, as amended, 
authorizes the President to provide GSP duty-free treatment on 
any eligible article from designated beneficiary developing 
countries, subject to certain conditions and limits, having due 
regard for (1) the effect of such action on furthering the 
economic development of developing countries through the 
expansion of their exports; (2) the extent other major 
developed countries are undertaking a comparable effort to 
assist developing countries by granting generalized preferences 
on their products (i.e., burden-sharing); (3) the anticipated 
impact on U.S. producers of like or directly competitive 
products; and (4) the extent of the BDC's competitiveness with 
respect to eligible articles. In 1999, the program provided 
duty-free treatment on imports valued at about $13.7 billion 
from 146 designated developing countries and territories.

Designation of beneficiary developing countries

    Section 502 of the Trade Act of 1974 authorizes the 
President to designate a country or territory as a BDC. It also 
authorizes the President to designate any BDC as a least-
developed beneficiary developing country (LDBDC). However, the 
President is expressly prohibited from designating the 
following developed countries as BDCs:

Australia                   Japan
Canada                      Monaco
European Union              New Zealand
  member states             Norway
Iceland                     Switzerland

    The President is also prohibited from designating any 
country for GSP benefits which:
          (1) is a communist country unless (a) its products 
        receive non-discriminatory (MFN) treatment; (b) it is a 
        WTO member and a member of the International Monetary 
        Fund (IMF); and (c) it is not dominated or controlled 
        by international communism;
          (2) is party to an arrangement and participates in 
        any action which withholds supplies of vital commodity 
        resources or raises their price to unreasonable levels, 
        causing serious disruption of the world economy;
          (3) affords ``reverse preferences'' to other 
        developed countries which have or are likely to have a 
        significant adverse effect on U.S. commerce;
          (4) has nationalized or expropriated U.S. property, 
        including patents, trademarks, or copyrights, or taken 
        actions with similar effect, unless the President 
        determines and reports to Congress there is adequate 
        and effective compensation, negotiations underway to 
        provide compensation, or a dispute over compensation is 
        in arbitration;
          (5) fails to recognize as binding or to enforce 
        arbitral awards in U.S. favor;
          (6) aids or abets by granting sanctuary from 
        prosecution to, any individual or group which has 
        committed international terrorism, or is the subject of 
        a determination by the Secretary of State under section 
        6(j)(1)(A) of the Export Administration Act of 1979 (50 
        U.S.C. app. 2405) regarding repeated support for 
        terrorism; or
          (7) has not taken or is not taking steps to afford 
        internationally recognized workers rights to its 
        workers.\15\
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    \15\ Defined by amendment under section 503 of the 1984 Act for 
purposes of GSP to include:
    ``(A) the right to association;
    ``(B) the right to organize and bargain collectively;
    ``(C) a prohibition on the use of any form of forced or compulsory 
labor;
    ``(D) a minimum age for the employment of children; and
    ``(E) acceptable conditions of work with respect to minimum wages, 
hours of work, and occupational safety and health''.
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    The President may waive conditions (4), (5), (6), and (7), 
if he determines and reports with reasons to the Congress that 
designation of the particular country is in the national 
economic interest. Section 412 of the Trade and Development Act 
of 2000 (Public Law 106-200) added a new eligibility criterion 
to this list which prohits the President from designating a 
country for GSP benefits if it has not implemented its 
commitments to eliminate the worst forms of child labor.
    In addition, the President must take certain other factors 
into account under section 502(c) in designating BDCs: (1) an 
expressed desire of the country to be designated; (2) the 
country's level of economic development; (3) whether other 
major developed countries extend GSP to the country; (4) the 
extent the country has assured the United States it will 
provide ``equitable and reasonable access'' to its markets and 
basic commodity resources and refrain from engaging in 
unreasonable export practices; (5) the extent the country is 
providing adequate and effective means under its laws for 
foreign nationals to secure, exercise, and enforce exclusive 
rights in intellectual property; (6) the extent the country has 
taken action to reduce trade distorting investment practices 
and policies and reduce or eliminate barriers to trade in 
services; and (7) whether the country has taken or is taking 
steps to afford its workers internationally-recognized worker 
rights.
    If the President determines that a BDC has become a ``high 
income'' country as defined by the World Bank, the President is 
required to remove the country from eligibility under the 
program. The statute provides for a transition period of up to 
2 years for country graduation from the GSP program. In 1994 
the World Bank designated countries with a per capita GNP of 
approximately $8,600 as ``high income'' countries.
    Before designating any country as a BDC, the President must 
notify the Congress of his intention and the considerations 
entering into the decision. Before terminating designation of 
any beneficiary, the President must provide the Congress and 
the country concerned at least 60 days advance notice of his 
intention, together with the reasons. The President must 
withdraw or suspend the designation if he determines the 
country no longer meets the conditions for designation.
    The countries currently designated as BDCs of GSP are 
listed under General Note 4(a) of the Harmonized Tariff 
Schedule of the United States (HTS). Countries designated as 
LDBDCs are listed under General Note 4(b). On March 21, 1995, 
the President notified Congress of his determination to 
designate the West Bank and Gaza Strip as a beneficiary 
country.\16\
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    \16\ Message from the President of the United States transmitting 
notification of his intent to add the West Bank and Gaza Strip to the 
list of beneficiary developing countries under the Generalized System 
of Preferences (GSP), pursuant to 19 U.S.C. 2462(a), House Document 
104-47, March 21, 1995.
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    On June 30, 1999, pursuant to section 502 of the Trade Act 
of 1974, President Clinton designated Gabon and Mongolia as 
beneficiary developing countries for purposes of GSP. He futher 
determined, pursuant to section 502, that GSP benefits for 
Mauritania, which were suspended on June 25, 1993, should be 
reinstated.\17\ On August 27, 2000, pursuant to sections 501 
and 502, President Clinton designated Nigeria as a beneficiary 
country.\18\
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    \17\ Presidential Proclamation No. 7206, June 30, 1999, 64 Fed. 
Reg. 36229-36231.
    \18\ Presidential Proclamation No. 7335, August 27, 2000, 65 Fed. 
Reg. 52903.
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Eligible articles

    The President designates articles under section 503 
eligible for GSP duty-free treatment after considering advice 
required through public hearings, from the U.S. International 
Trade Commission (ITC) on the probable domestic economic 
impact, and from executive branch agencies.
    In general, GSP duty-free treatment is prohibited by 
statute on textile and apparel articles which were not eligible 
articles on January 1, 1994; watches, except those watches 
entered after June 30, 1989, that the President specifically 
determines, after public notice and comment, will not cause 
material injury to watch or watch band, strap, or bracelet 
manufacturing and assembly operations in the United States or 
U.S. insular possessions; \19\ import-sensitive electronic 
articles; import-sensitive steel articles; footwear, handbags, 
luggage, flat goods (e.g., wallets, change purses, eyeglass 
cases), work gloves, and leather wearing apparel which were 
ineligible for GSP as of January 1, 1995; and import-sensitive 
semi-manufactured and manufactured glass products. The 
President must also exclude any other articles he determines to 
be import sensitive in the context of GSP. Articles are 
ineligible for GSP during any period they are subject to import 
relief under sections 201-204 of the Trade Act of 1974 or to 
national security actions under section 232 of the Trade 
Expansion Act of 1962. Also, no quantity of an agricultural 
product subject to a tariff-rate quota that exceeds the in-
quota quantity may be eligible for duty-free treatment under 
GSP.
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    \19\ This amendment was made by section 1903 of the Omnibus Trade 
and Competitiveness Act of 1988, Public Law 100-418, approved August 
23, 1988.
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    The President may designate any article that is the growth, 
product or manufacture of an LDBDC as an eligible article with 
respect to LDBDCs after receiving advice from the ITC, if he 
determines such an article is not import-sensitive in the 
context of imports from LDBDCs. However, he may not designate 
the statutorily exempt articles--textiles and apparel, footwear 
and related articles, and watches. The President must notify 
Congress at least 60 days in advance of LDBDC designations.
    The USTR has established by regulation an interagency 
procedure for annual review of petitions from any interested 
party to have articles added to, or removed from, the GSP 
eligible list. The interagency committee also considers 
modifications on its own motion. However, section 503 prohibits 
consideration of an article for designation of eligibility for 
3 years following formal consideration and denial of that 
article.
    GSP duty-free treatment applies only to an eligible article 
which is the growth, product, or manufacture of a BDC (i.e., 
has undergone ``substantial transformation'' in an exporting 
BDC) \20\ and which meets the following rule-of-origin 
requirements:
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    \20\ An amendment made by section 226 of the Caribbean Basin 
Economic Recovery Act of 1990, Public Law 101-382, title II, approved 
August 20, 1990, 19 U.S.C. 2463(b), conformed GSP rules to treatment 
under the Caribbean Basin Initiative.
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          (1) the article must be imported directly from a BDC 
        into the U.S. customs territory; and
          (2) the sum of (a) the cost or value of materials 
        produced in a beneficiary country, plus (b) the direct 
        cost of processing performed in such country is not 
        less than 35 percent of the appraised value of the 
        article when it enters into the U.S. customs territory.
    Materials and processing costs in two or more beneficiary 
countries which are members of the same association of 
countries which is a customs union or free trade area may be 
treated as one BDC and cumulated to meet the 35 percent minimum 
local content. Materials imported into a BDC may be counted 
toward the 35 percent minimum valued-added requirement only if 
they are substantially transformed into new and different 
articles in the BDC, before they are incorporated into the GSP 
eligible article.

Treatment of sugar imports under GSP

    Under the tariff-rate quota system for sugar,\21\ the 
Secretary of Agriculture establishes the quota quantity that 
can be entered at the lower tier import duty rate, and the U.S. 
Trade Representative (USTR) allocates the quantity among sugar 
exporting quantities. The quantities allocated to beneficiary 
countries under the Generalized System of Preferences receive 
duty-free treatment. Imports above the in-quota amount from 
beneficiary countries are tariffed at the higher, over-quota 
rate. Certificates of quota eligibility (CQE) are issued to the 
exporting countries and must be returned with the shipment of 
sugar in order to receive quota treatment.
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    \21\ Presidential Proclamation No. 6763, December 23, 1994, 60 Fed. 
Reg. 1007.
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Limitations on preferential treatment

    The President has general authority under section 503(c) to 
withdraw, suspend, or limit application of GSP and restore 
column 1 normal trade relations (NTR) or most-favored-nation 
(MFN) duties with respect to any article or any country after 
considering the factors in sections 501 and 502(c), but he 
cannot establish any intermediate rates of duty. Since 1981, 
this authority has been used in the context of the annual 
interagency review process for ``discretionary graduation'' 
from GSP of particular products from particular countries which 
have demonstrated their competitiveness and to promote a 
shifting of benefits to less advanced developing countries.
    Pursuant to the authority of this section, the President on 
January 29, 1988, notified the Congress of his intention to 
remove Hong Kong, the Republic of Korea, Singapore, and Taiwan 
from their status as beneficiaries under the GSP program,\22\ 
effective on January 2, 1989. Removal from GSP status was based 
on the President's assessment that these four BDCs had 
``achieved an impressive level of economic development and 
competitiveness, which can be sustained without the preferences 
provided by the program.'' Similarly, on October 17, 1996, the 
President made a determination that Malaysia was ``sufficiently 
advanced in economic development and improved trade 
competitiveness'' and that designation of Malaysia as a 
beneficiary developing country would be terminated efffective 
January 1, 1997.\23\ Pursuant to 502(e) of the Act the 
President also determined on October 17, 1996, that Cyprus, 
Aruba, Macau, the Netherlands Antilles, Greenland, and the 
Cayman Islands meet the definition of a ``high income'' country 
as defined by official statistics of the World Bank, 
terminating preferential treatment under GSP for imports from 
these countries effective January 1, 1998. \24\
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    \22\ Message from the President of the United States transmitting 
notification of his intent to remove Hong Kong, the Republic of Korea, 
Singapore, and Taiwan from the list of beneficiary developing countries 
under the Generalized System of Preferences (GSP), pursuant to 19 
U.S.C. 2462(a), House Document 100-162, February 1, 1988.
    \23\ Presidential Proclamation No. 6942, October 17, 1996, 61 Fed. 
Reg. 54719.
    \24\ Ibid.
---------------------------------------------------------------------------
    On July 6, 2000, Clinton proclaimed that according to 
section 502(e), Malta, French Polynesia, New Caledonia, and 
Slovenia meet the definition of ``high income'' countries as 
defined by the official statistics of the International Bank 
for Reconstruction and Development. Therefore, he terminated 
the preferential treatment under the GSP for articles that are 
currently eligible for such treatment from these countries, 
effective January 1, 2002. On July 6, 2000, President Clinton 
announced the suspension of Belarus's GSP benefits ``because it 
has not taken and is not taking steps to afford workers in that 
country internationally recognized worker rights.'' \25\
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    \25\ Presidential Proclamation No. 7328, July 6, 2000, 65 Fed. Reg. 
42595-42596.
---------------------------------------------------------------------------
    In addition to the annual review of petitions on article or 
country eligibility, section 503(c) establishes statutory 
``competitive need'' limitations on GSP duty-free treatment, 
subject to waiver under certain conditions. The basic purposes 
of the competitive need limitations are to (1) establish a 
benchmark for determining when products from particular 
countries are competitive in the U.S. market and therefore no 
longer warrant preferential tariff treatment; and (2) to 
reallocate GSP benefits to less competitive producing 
countries. The limits have also provided some measure of import 
protection to domestic producers of like or directly 
competitive products.
    Under the competitive need limits, if imports of a 
particular article from a particular BDC exceed either (1) a 
value level adjusted annually (in calendar year 1996, $75 
million, and in each subsequent year, the amount for the 
preceding year plus $5 million); or (2) 50 percent of total 
U.S. imports of the article in a particular calendar year, GSP 
treatment on that article from that country must be removed and 
the normal rate of duty imposed on all imports of the article 
from that country by July 1 of the following year. GSP 
treatment may be reinstated in a subsequent calendar year if 
imports of the product from the excluded country have fallen 
below the competitive need ceilings then in effect during the 
preceding calendar year.
    There are four statutory circumstances in which competitive 
need limits may not apply:
          (1) If the President determines that an article like 
        or directly competitive with a particular GSP article 
        was not produced in the United States on January 1, 
        1995, then that article is exempt from the 50-percent, 
        but not the dollar value, competitive need limit.
          (2) The President may waive the 50-percent, but not 
        the dollar, competitive need limit on articles for 
        which total U.S. imports are de minimis, i.e., not more 
        than $13 million in calendar year 1996, and in each 
        subsequent year, the amount for the preceding year plus 
        $500,000.
          (3) Neither of the competitive need limits applies to 
        any BDC the President determines to be a least 
        developed developing country.
          (4) The President may waive the competitive need 
        limits for a particular country based on a 
        determination that (a) there has been an historical 
        preferential trade relationship between the United 
        States and such country; (b) there is a treaty or trade 
        agreement in force covering economic relations between 
        such country and the United States; and (c) such 
        country does not discriminate against or impose 
        unjustifiable or unreasonable barriers to U.S. 
        commerce. This waiver authority, which was designed for 
        possible exemption of the Philippines, has never been 
        utilized.
    The President may waive competitive need limits on any 
article if he (1) receives ITC advice on whether any U.S. 
industry is likely to be adversely affected; (2) determines a 
waiver is in the national economic interest based upon the 
country designation factors under sections 501 and 502(c) as 
amended; and (3) publishes his determination. In making the 
national interest determination the President must give great 
weight to (1) assurances of equitable and reasonable market 
access in the BDC; and (2) the extent the country provides 
adequate and effective intellectual property rights protection. 
Total waivers for all countries above existing competitive need 
limits cannot exceed 30 percent of total GSP duty-free imports 
in any year, of which not more than one-half (i.e., 15 percent 
of total GSP duty-free imports) may apply to waivers on 
articles from countries which account for at least a 10-percent 
share of total GSP duty-free imports or have a per capita GNP 
of $5,000 or more in that year.

Other provisions

    Section 504 requires the President to submit an annual 
report to the Congress on the status of internationally-
recognized worker rights within each BDC, including the 
findings of the Secretary of Labor with respect to each BDC's 
implementation of its international commitments to eliminate 
the worst forms of child labor.
    Section 506 requires appropriate U.S. agencies to assist 
BDCs to develop and implement measures designed to assure that 
the agricultural sectors of their economies are not directed to 
export markets to the detriment of foodstuff production for 
their own citizens.

                    Caribbean Basin Initiative (CBI)

    The Caribbean Basin Economic Recovery Act (CBERA),\26\ 
commonly referred to as the Caribbean Basin Initiative or CBI, 
was enacted on August 5, 1983, authorizing the grant of certain 
U.S. unilateral preferential trade and tax benefits for 
Caribbean Basin countries and territories.
---------------------------------------------------------------------------
    \26\ Public Law 98-67, title II, approved August 5, 1983, 19 U.S.C. 
2701 et seq.
---------------------------------------------------------------------------
    The centerpiece of the CBI is authority granted to the 
President to provide unilateral duty-free treatment on U.S. 
imports of eligible articles from designated Caribbean Basin 
countries and territories. Duty-free treatment became effective 
as of January 1, 1984, and currently applies to imports from 24 
designated beneficiary countries or territories.\27\
---------------------------------------------------------------------------
    \27\ Anguilla, Cayman Islands, Suriname, and the Turks and Caicos 
Islands are not currently designated; Aruba, originally part of the 
Netherlands Antilles, is designated separately.
---------------------------------------------------------------------------
    The United States developed this program for responding to 
the economic crisis in the Caribbean in close consultation with 
governments and private sectors of potential recipients and 
with other donor countries in the region. On February 24, 1982, 
President Reagan outlined the CBI before the Organization of 
American States and on March 17, 1982, he first submitted this 
plan to the Congress. H.R. 7397, containing amended versions of 
the trade and tax proposals, was passed by the House of 
Representatives in the 97th Congress on December 17, 1982, but 
was not acted on by the Senate. The President resubmitted the 
House-passed version of the plan on February 23, 1983; the 
Initiative as further amended became title II of the conference 
report on H.R. 2973, to repeal the withholding of tax from 
interest and dividends, agreed to by both Houses on July 28, 
1983. Separate foreign assistance legislation increased aid to 
the region as the third element of the program.
    Following extensive congressional consideration and 
consultations with representatives of the countries involved 
and U.S. private sector interests on measures to improve the 
program, the Caribbean Basin Economic Recovery Expansion Act of 
1990, so-called CBI II, was enacted as title II of the Customs 
and Trade Act of 1990.\28\ CBI II amended the CBERA to make the 
trade benefits permanent by repealing the 12-year September 30, 
1995, termination date and to make certain improvements in the 
trade and tax benefits. The Act also included measures to 
promote tourism and created a scholarship assistance program 
for the region.
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    \28\ Public Law 101-382, title II, approved August 20, 1990.
---------------------------------------------------------------------------

                 Caribbean Basin Trade Partnership Act

    Based on the success of the CBI program and in response to 
the devastation caused to the region by Hurricanes Georges and 
Mitch in September and October of 1998, H.R. 984, the Caribbean 
and Central American Relief and Economic Stabilization Act, a 
bill to grant NAFTA parity to nations in the Caribbean Basin 
was introduced on March 9, 1999. It was approved by the Ways 
and Means Committee on March 31, 2000. No further action on 
H.R. 984 was taken in the House.
    On June 22, 1999, the Senate Committee on Finance 
considered draft legislation reported titled ``The United 
States-Caribbean Basin Trade Enhancement Act.'' The provisions 
in this version marked up by the Committee on Finance differed 
from the trade provisions in H.R. 984, as approved by the 
Committee on Ways and Means, by requiring that imports of 
apparel products from the Caribbean Basin region qualifying for 
duty-free and quota free entry be made of fabric of U.S. 
origin.
    On November 3, 1999, the Senate passed H.R. 434, the 
African Growth and Opportunity Act, as amended, by a vote of 
76-19. During Senate consideration of the bill, the text of S. 
1389, ``The United States-Caribbean Basin Trade Enhancement 
Act,'' was added as an amendment. The House passed the 
conference report on H.R. 434 by a vote of 309-110 on May 4, 
2000. The Senate passed the conference report by a vote of 77-
19 on May 11, 2000. On May 4, 2000, the conference report on 
H.R. 434 was filed (H. Rept. 106-606), and the bill was signed 
into law on May 18, 2000 (P.L. 106-200).
    The new legislation, entitled the Caribbean Basin Trade 
Partnership Act (CBTPA), builds on the Caribbean Basin Economic 
Recovery Act and extends additional trade benefits through 
2008. The CBTPA, an enhanced CBI program covering more 
products, in based on the view that economic recovery in the 
region will be achieved most effectively by creating 
opportunities to expand international trade. Likewise, the 
success of the original CBI program indicates that increasing 
international trade with the CBI regions will also promote the 
growth of United States exports, decrease illegal immigration, 
and improve regional cooperation in efforts to fight drug 
trafficking. Finally, CBTPA is intended to foster increased 
opportunities for U.S. companies in the textile and apparel 
sector to expand co-production arrangements with countries in 
the CBI region, thereby sustaining and preserving manufacturing 
operations in the United States that would otherwise be 
relocated to the Far East.
    In general, the CBTPA extends NAFTA declining or duty-free 
tariff treatment to several categories of goods excluded from 
the CBI. With respect to apparel products, the CBTPA extends 
duty-free benefits to: (1) apparel made in the Caribbean Basin 
from U.S. yarn and fabric; (2) knit apparel made in CBI from 
regional fabric made with U.S. yarn and to knit-to-shape 
apparel (except socks), up to a cap of 250 million square meter 
equivalents, with a growth riate of 16% per year for the first 
three years, and (3) an additional category of regional knit 
apparel products up to a cap a 4.2 million dozen, growing 16% 
per year for the first three years.
    The CBTPA requires that eligible countries implement 
Customs procedures to guard against transshipment.\29\ Under a 
``one strike and you are out'' provision, if an exporter is 
determined to have engaged in illegal transhipment of textile 
and apparel products from a CBI country, the President is 
required to deny all benefits under the bill to that exporter 
for a period of two years.
---------------------------------------------------------------------------
    \29\ Presidential Proclamation 7351 of October 10, 2000 (65 Fed. 
Reg. 60,236, October 4, 2000) designated Belize, Costa Rica, Dominican 
Republic, El Salvador, Guatemala, Haiti, Honduras, Jamaica, Nicaragua, 
and Panama as countries that USTR has determined implement and follow 
or are making substantial progress toward implementing and following, 
the customs procedures required by the CBTPA and, therefore, are 
eligible for enhanced apparel benefits provided under the Act.
---------------------------------------------------------------------------

Beneficiary countries or territories

    Section 212 of the CBERA lists the following 27 countries 
and territories as potentially eligible for designation by the 
President as CBI beneficiary countries:

Anguilla                           Guatemala
Antigua and Barbuda                Guyana
Bahamas, The                       Haiti
Barbados                           Honduras
Belize                             Jamaica
Cayman Islands                     Montserrat
Costa Rica                         Netherlands Antilles
Dominica                           Nicaragua
Dominican Republic                 Panama
El Salvador                        Saint Christopher and Nevis
Grenada                            Saint Lucia
Saint Vincent and the              Trinidad and Tobago
  Grenadines                       Turks and Caicos Islands
Suriname                           Virgin Islands, British

    The countries currently designated as CBI beneficiaries are 
listed under General Note 7 of the Harmonized Tariff Schedule 
of the United States.

General Designation Criteria

    On October 2, 2000, USTR designated all 24 current 
beneficiaries under the CBERA as ``CBTPA'' beneficiary 
countries.\30\ As noted above, ten countries receive enhanced 
apparel benefits.
---------------------------------------------------------------------------
    \30\ 65 Fed. Reg. 60,236.
---------------------------------------------------------------------------
    Section 212(b) of the CBERA, as amended, prohibits the 
President from designating a country or territory as a 
beneficiary of CBI trade or tax benefits if it:
          (1) is a Communist country;
          (2) has nationalized or expropriated U.S. property, 
        including any patent, trademark, or other intellectual 
        property, or taken actions with similar effect, without 
        compensation or submission to arbitration;
          (3) fails to recognize or enforce awards arbitrated 
        in favor of U.S. citizens;
          (4) affords preferential tariff treatment to products 
        of other developed countries that has or is likely to 
        have a significant adverse effect on U.S. commerce;
          (5) broadcasts U.S. copyrighted material without the 
        owners' consent;
          (6) has not signed an extradition agreement with the 
        United States; and
          (7) has not or is not taking steps to afford 
        internationally-recognized worker rights (as defined 
        for the Generalized System of Preferences program) to 
        workers in the country (including any designated zone 
        in that country).
    The President may waive conditions (1), (2), (3), (5), and 
(7) if he determines that designation of the particular country 
would be in the national economic or security interest of the 
United States and so reports to the Congress.
    In addition, the President must take into account certain 
other factors under section 212(c) in determining whether to 
designate a country a CBI beneficiary: (1) the country's 
expressed desire to be designated; (2) economic conditions and 
living standards in the country; (3) the extent the country has 
assured the United States it will provide equitable and 
reasonable access to its markets and basic commodity resources; 
(4) the degree the country follows accepted rules of 
international trade under the World Trade Organization and 
applicable trade agreements; (5) the degree the country uses 
export subsidies or imposes export performance or local content 
requirements; (6) the degree the country's trade policies 
contribute to regional revitalization; (7) the degree the 
country is undertaking self-help measures; (8) whether or not 
the country has taken or is taking steps to afford its workers 
(including in any designated zone of the country) 
internationally-recognized worker rights; (9) the extent the 
country provides adequate and effective means under its law for 
foreign nationals to secure, exercise, and enforce exclusive 
rights in intellectual property; (10) the extent the country 
prohibits its nationals from broadcasting U.S. copyrighted 
materials without permission; and (11) the extent to which the 
country is prepared to cooperate in the administration of the 
CBI. The President must notify the Congress of his intention to 
designate countries, together with the considerations entering 
the decision.
    The President may later withdraw or suspend the designation 
of any country as a beneficiary country or withdraw, suspend, 
or limit the application of duty-free treatment for any 
eligible article of any country if he determines that, based on 
changed circumstances, such country would be barred from 
designation under the criteria set forth in subsection (b) of 
section 212.\31\ The President is required to publish at least 
30 days advance notice of such proposed action in the Federal 
Register. During the 30-day notice period, USTR is required to 
hold a public hearing and accept public comments on the 
proposed action.
---------------------------------------------------------------------------
    \31\ Section 1909 of the Omnibus Trade and Competitiveness Act 
(Public Law 100-418).
---------------------------------------------------------------------------
    The President must submit a complete report to the Congress 
by October 1, 1993, and every 3 years thereafter regarding the 
operation of the CBI. This report must include general reviews 
of CBI beneficiary countries based upon all section 212 
designation criteria.

Designation Criteria for CBTPA Benefits

    In designating a country as eligible for the enhanced CBTPA 
benefits, the President is to take into account the existing 
eligibility criteria established under CBERA, as well other 
appropriate criteria, including whether a country has 
demonstrated a commitment to undertake its WTO obligations and 
participate in negotiations toward the completion of the FTAA 
or comparable trade agreement, the extent to which the country 
provides intellectual property protection consistent with or 
greater than that afforded under the Agreement on Trade-Related 
Aspects of Intellectual Property Rights, the extent to which 
the country provides internationally recognized worker rights, 
whether the country has implemented its commitments to 
eliminate the worst form of child labor, the extent to which a 
country has taken steps to become a party to and implement the 
Inter-American Convention Against Corruption, and the extent to 
which the country applies transparent, nondiscriminatory and 
competitive procedures in government procurement equivalent to 
those included in the WTO Agreement on Government Procurement 
and otherwise contributes to efforts in international fora to 
develop and implement international rules in transparency in 
government procurement.

Eligible articles

    CBI duty-free treatment under section 213(a) of the CBERA 
applies only to articles which meet three rule-of-origin 
requirements:
          (1) The article must be imported directly from a 
        beneficiary country into the U.S. customs territory;
          (2) The article must contain a minimum 35 percent 
        local content of one or more beneficiary countries (up 
        to 15 percent of the total value of the article from 
        U.S.-made materials may count toward the 35 percent 
        requirement); and
          (3) The article must be wholly the growth, product, 
        or manufacture of a beneficiary country or, if it 
        contains foreign materials, be substantially 
        transformed into a new or different article in a 
        beneficiary country.
Other provisions and regulations preclude minor pass-through 
operations or transshipments from qualification.
    Special criteria have been established for the duty-free 
entry of ethanol under the CBI program. The Tax Reform Act of 
1986 \32\ amended the 1983 CBI legislation to require 
increasing amounts of CBI feedstock in order for ethanol to 
qualify for duty-free treatment--30 percent in 1987; 60 percent 
in 1988; and 75 percent in 1989 and thereafter. Several 
companies were ``grandfathered'' for 2 years, allowing them to 
operate under pre-1986 criteria through 1989.
---------------------------------------------------------------------------
    \32\ Public Law 99-514, section 423, approved October 22, 1986.
---------------------------------------------------------------------------
    The Omnibus Trade and Competitiveness Act of 1988 \33\ 
extended the ``grandfather'' through the end of 1989 for six 
dehydration plants already built or under construction but 
imposed an import cap of 20 million gallons per facility. The 
Act also requested reports by the ITC and the General 
Accounting Office (GAO) on whether or not the current local 
feedstock requirements make CBI ethanol production economically 
feasible. Those reports concluded that CBI ethanol production 
would not be economically feasible under those local feedstock 
requirements.
---------------------------------------------------------------------------
    \33\ Public Law 100-418, section 1910, approved August 23, 1988.
---------------------------------------------------------------------------
    The Steel Trade Liberalization Program Implementation Act 
of 1989 \34\ provided that for calendar years 1990 and 1991, 
ethanol (and any mixture thereof) that is only dehydrated 
within a CBI beneficiary country or an insular possession 
receives duty-free treatment only if it meets the applicable 
local feedstock requirement: (1) no feedstock requirement is 
imposed on imports up to a level of 60 million gallons or 7 
percent of the domestic ethanol market (as determined by the 
ITC, based on the 12-month period ending on the preceding 
September 30), whichever is greater; (2) a local feedstock 
requirement of 30 percent by volume applies to the next 35 
million gallons of imports above the 60 million gallon or 7 
percent level described above; and (3) a local feedstock 
requirement of 50 percent by volume applies to any additional 
imports. Ethyl alcohol (or a mixture thereof) that is produced 
by a process of full fermentation in an insular possession or 
beneficiary country continues to be eligible for duty-free 
treatment in unlimited quantities without regard to feedstock 
requirements.
---------------------------------------------------------------------------
    \34\ Public Law 101-221, section 7, approved December 12, 1989.
---------------------------------------------------------------------------
    The Customs and Trade Act of 1990 extended the above 
provisions through 1992. The Omnibus Budget Reconciliation Act 
of 1990 \35\ further extended them through September 30, 2000.
---------------------------------------------------------------------------
    \35\ Public Law 101-508, section 11502, approved November 5, 1990.
---------------------------------------------------------------------------
    Section 213(b) of the CBERA exempts the following articles 
from CBI duty-free treatment: textiles and apparel subject to 
textile agreements; footwear, handbags, luggage, flat goods 
(such as wallets, change purses and key and eyeglass cases), 
work gloves, and leather wearing apparel not eligible for duty-
free treatment under the GSP program as of August 5, 1983; 
canned tuna; petroleum and petroleum products; and watches and 
watch parts containing components from non-most-favored-nation 
(column 2) sources.
    Section 212 of CBI II amended section 213 of the CBERA to 
authorize the President to proclaim a tariff reduction of 20 
percent, but not more than 2.5 percent ad valorem on any 
article, in the duties applicable to handbags, luggage, flat 
goods, work gloves, and leather wearing apparel not designated 
as eligible articles under the GSP program on August 5, 1983 
from CBI beneficiary countries, to be phased in in five equal 
annual stages beginning on January 1, 1992.
    Section 222 of CBI II also extended duty-free treatment to 
articles, other than textiles and apparel and petroleum and 
petroleum products, that are processed or assembled wholly from 
U.S. fabricated components or materials or processed wholly 
from U.S. ingredients (except water) in a CBI beneficiary 
country and neither the components, materials, and ingredients 
after export from the United States nor the article itself 
before importation into the United States enters the commerce 
of any third country.
    Under the tariff-rate quota system for sugar,\36\ the 
Secretary of Agriculture establishes the quota quantity that 
can be entered at the lower tier import duty rate, and the U.S. 
Trade Representative (USTR) allocates the quantity among sugar 
exporting quantities. The quantities allocated to beneficiary 
countries under the Caribbean Basin Initiative receive duty-
free treatment. Imports above the in-quota amount from 
beneficiary countries are tariffed at the higher, over-quota 
rate. Certificates of quota eligibility (CQE) are issued to the 
exporting countries and must be returned with the shipment of 
sugar in order to receive quota treatment.
---------------------------------------------------------------------------
    \36\ Presidential Proclamation No. 6763, December 23, 1994, 60 Fed. 
Reg. 1007.
---------------------------------------------------------------------------
    Section 213(c) requires the President to suspend duty-free 
treatment on imports of sugar and beef products from any 
beneficiary country that does not submit a satisfactory stable 
food production plan within 90 days after its designation, or 
while the country is not making a good faith effort to 
implement the plan or the plan is not achieving its purpose. 
The President must withhold suspension if the country agrees to 
consultations within a reasonable period of time and undertakes 
to formulate and implement remedial action.
    The import relief procedures and authorities under sections 
201-204 of the Trade Act of 1974, as amended, and national 
security measures under section 232 of the Trade Expansion Act 
of 1962 apply to imports from CBI beneficiary countries. 
Section 213(e) authorizes the President to suspend CBI duty-
free treatment and proclaim a rate of duty or other relief 
measures on CBI imports as on imports of the article from non-
CBI countries. Alternatively, the President may maintain duty-
free treatment or establish a margin of preference on imports 
from CBI countries. In its report to the President on import 
relief investigations covering CBI eligible articles, the ITC 
must state whether its findings with respect to serious injury 
to the domestic industry and its recommended remedy apply to 
imports from CBI beneficiary countries.
    Under a special procedure under section 213(b), petitioners 
for import relief on agricultural perishable products may also 
file a request with the Secretary of Agriculture for emergency 
relief. Within 14 days, the Secretary must determine whether 
there is reason to believe a CBI perishable product is being 
imported in such increased quantities as to be a substantial 
cause of serious injury to the domestic industry, and recommend 
to the President emergency relief, if warranted. The President 
must determine within 7 days after receiving the Secretary's 
recommendation whether to take emergency action restoring the 
normal rate of duty pending final action on the import relief 
petition.
    Section 215 requires the ITC to report annually to the 
Congress on the actual economic impact and its assessment of 
the probable future effects of the Act on the U.S. economy 
generally and on specific domestic industries. Section 216 also 
requires an annual report to the Congress by the Secretary of 
Labor on the impact of the CBI on U.S. labor.

Enhanced Temporary Trade Benefits under the CBTPA

    Under NAFTA, imported products from Mexico receive NAFTA 
declining tariff or duty-free and quota-free treatment. Chapter 
Four of NAFTA establishes rules of origin for identifying goods 
that are to be treated as ``originating in the territories of 
NAFTA parties'' and are therefore eligible for preferential 
treatment accorded to originating goods under NAFTA, including 
reduced duties and duty-free and quota-free treatment.
    The CBTPA provides that NAFTA tariff treatment applies to 
articles eligible under CBI that meet NAFTA rules of origin 
(treating the United States and CBI beneficiary countries as 
``parties'' under the agreement for this purpose). Customs 
procedures applicable to exporters under NAFTA also must be met 
for partnership countries (i.e. CBTPA eligible) to quality for 
parity treatment. Imports of articles eligible under the CBI 
but which do not meet the conditions of NAFTA parity would 
continue to be excluded from the program.
    Under the CBTPA, NAFTA tariff treatment applies to goods 
excluded from the CBI, except to textiles and apparel. More 
specifically, for imports of canned tuna, petroleum and 
petroleum products, footwear, handbags, luggage, flat goods, 
work gloves, and leather-wearing apparel, the legislation 
provided an immediate reduction in tariffs equal to the 
preference Mexican products enjoy under NAFTA. The applicable 
duty paid by importers on such goods is equal to the duty 
applicable to the same goods if entered from Mexico.
    In order for their products to qualify for any of the 
preferences afforded under this Act, whether applied to 
textiles and apparel or other products, the beneficiary country 
must comply with customs procedures equivalent to those 
required under the NAFTA.

Temporary Trade Benefits for Apparel Imports Under CBTPA

    The CBTPA provides duty-free, quota-free treatment to the 
following apparel products:
    (1) apparel articles assembled in an eligible CBI 
beneficiary country from U.S. fabrics wholly formed from U.S. 
yarns and cut in the United States that would enter the United 
States under Harmonized Tariff Schedule (HTS) item number 
9802.00.80 (a provision that otherwise allows an importer to 
pay duty solely on the value-added abroad when U.S. components 
are shipped abroad for assembly and re-imported into the United 
States);
    (2) apparel articles assembled in a CBTPA country from 
fabrics wholly formed and cut in the United States, from yarns 
wholly formed in the United States that are (I) entered under 
subheading 9802.00.80 of the HTS or (II) entered under chapter 
61 or 62 of the HTS, if, after such assembly, the articles 
would have qualified for entry under subheading 9802.00.80 but 
for the fact that the articles were embroidered or subjected to 
stone-washing, enzyme-washing, acid washing, perma-pressing, 
oven-baking, bleaching, garment-dyeing, screen printing, or 
other similar processes;
    (3) apparel articles cut in a CBTPA beneficiary country 
from fabric wholly formed in the United States from yarns 
wholly formed in the United States, if such articles are 
assembled in such country with thread formed in the United 
States;
    (4) certain apparel articles knit-to-shape (other than 
socks provided for in heading 6115 of the HTS) in a CBTPA 
beneficiary country from yarns wholly formed in the United 
States, and knit apparel articles (other than certain T-shirts, 
as described below) cut and wholly assembled in one or more 
CBTPA beneficiary countries from fabric formed in one or more 
CBTPA beneficiary countries or the United States from yarns 
wholly formed in the United States, in an amount not to exceed 
250 million square meter equivalents (SMEs) during the one-year 
period beginning on October 1, 2000. That amount will increase 
by 16 percent, compounded annually, in each succeeding one-year 
period through September 30, 2004. In each one-year period 
thereafter through September 30, 2008, the amount will be the 
amount that was in effect for the one-year period ending on 
September 30, 2004, or such other amount as may be provided by 
law. For T-shirts, other then underwear T-shirts, the amount 
eligible for duty-free, quota-free treatment is 4.2 million 
dozen during the one-year period beginning on October 1, 2000. 
That amount will be increased by 16 percent, compounded 
annually, in each succeeding 1-year period through September 
30, 2004 and thereafter will be the amount in effect for the 
period ending on September 30, 2004, or such other amount as 
may be provided by law. The conference agreement provides that 
it is the sense of Congress that the Congress should determine, 
based on the record of expansion of exports from the United 
States as a result of the preferential treatment of articles 
under this provision, the percentage by which the amounts 
referred to above the respect to knit-to-shape articles and T-
shirts should be compounded for the one-year periods occurring 
after the period ending on September 30, 2004;
    (5) certain brassieres, subject to the requirements set 
forth in the Act;
    (6) certain articles assembled from fibers, yarns or fabric 
not widely available in commercial quantities, with reference 
to the relevant provisions of the NAFTA; the conference 
agreement also authorizes the President to extend duty-free and 
quota-free treatment to certain other fibers, fabrics and 
yarns. Any interested party may submit to the President a 
request for extension of benefits to fibers, fabrics and yarns 
not available. The requesting party will bear the burden of 
demonstrating that a change is warranted by providing 
sufficient evidence. The President must make a determination 
within 60 calendar days of receiving a request from an 
interested party;
    (7) certain handloomed, handmade and folklore articles; and
    (8) certain textile luggage, as described in the 
legislation.

The CBTPA establishes certain special rules relating to apparel 
        products:

    (1) Findings and trimmings.--Articles otherwise eligible 
for preferential treatment shall not be ineligible for such 
treatment because the article contains findings or trimmings of 
foreign origin, if such findings and trimmings do not exceed 25 
percent of the cost of the components of the assembled product. 
However, sewing thread shall not be treated as a finding or 
trimming for purposes of apparel articles cut in a CBTPA 
beneficiary country from fabric wholly formed in the United 
States from yarns wholly formed in the United States, where 
preferential treatment in contingent upon assembly with thread 
formed in the United States.
    (2) Interlinings.-- Articles otherwise eligible for 
preferential treatment shall not be ineligible for such 
treatment because the articles contain certain interlinings, as 
described in the legislation, of foreign origin, if the value 
of such interlinings (and any findings and trimmings) does not 
exceed 25 percent of the cost of the components of the 
assembled articles. This rule will not apply if the President 
determines that United States manufacturers are producing such 
interlinings in the United States in commercial quantities;
    (3) DeMinimis.--An article otherwise ineligible for 
preferential treatment because the article contains fibers or 
yarns not wholly formed in the United States or in one or more 
beneficiary countries shall not be ineligible for such 
treatment if the total weight of all such fibers or yarns is 
not more then seven percent of the total weight of the good. 
However, in order for an apparel article containing elastomeric 
yarns to be eligible for preferential treatment, such yarns 
must be wholly formed in the United States.
    (4) Special Origin Rule.--An article otherwise eligible for 
preferential treatment shall not be ineligible for such 
treatment because the article contains nylon filament yarn 
(other then eleastomeric yarn), if entered under certain tariff 
headings from a country that is a party to an agreement with 
the United States establishing a free trade area which entered 
into force before January 1, 1995.
    The CBTPA establishes a transition period that began on 
October 1, 2000 and ends on the earlier of September 30, 2008, 
or the date on which the Free Trade Area of the Americas or 
another free trade agreement as described in the legislation 
enters into force with respect to the United States and the 
CBTPA beneficiary country.

Customs Procedures and Penalties for Transshipment

    Under the NAFTA, Parties to the Agreement must observe 
Customs procedures and documentation requirements, which are 
established in Chapter 5 of NAFTA. Requirements regarding 
Certificates of Origin for imports receiving preferential 
tariffs are detailed in Article 502.1 of NAFTA. The CBTPA 
requires the Secretary of the Treasury to prescribe regulations 
that require, as a condition of entry, that any importer of 
record claiming preferential tariff treatment for textile and 
apparel products under the bill must comply with requirements 
similar in all material respects to the requirements regarding 
Certificates of Origin contained in Article 502.1 of NAFTA, for 
a similar importation from Mexico. In addition, if an exporter 
is determined under the laws of the United States to have 
engaged in illegal transshipment of textile or apparel products 
from a partnership country, then the President shall deny all 
benefits under the bill to such exporter, and to any successors 
of such exporter, for a period of two years.
    In cases where the President has requested a beneficiary 
country to take action to prevent transshipment and the country 
has failed to do so, the President shall reduce the quantities 
of textile and apparel articles that may be imported into the 
United States from that country by three times the quantity of 
articles transshipped, to the extent that such action is 
consistent with WTO rules.

Other trade benefits

    Under the antidumping and countervailing duty laws, imports 
from two or more countries subject to investigation must 
generally be aggregated for the purpose of determining whether 
the unfair trade practice causes material injury to a U.S. 
industry, absent certain exceptions. Section 224 of CBI II 
created an exception to the general cumulation rule for imports 
from CBI beneficiary countries. If imports from a CBI country 
are under investigation in an antidumping or countervailing 
duty case, imports from that country may not be aggregated with 
imports from non-CBI countries under investigation for purposes 
of determining whether the imports from the CBI country are 
causing, or threatening to cause, material injury to a U.S. 
industry. They may be aggregated with imports from other CBI 
countries under investigation. Imports from CBI countries 
continue to be cumulated with imports from non-CBI countries 
for purposes of determining material injury in investigations 
of imports from non-CBI countries.
    CBI II also increased the duty-free tourist allowance for 
U.S. residents returning directly or indirectly from a CBI 
beneficiary country from $400 to $600 and allows such tourists 
to enter 1 additional liter of alcoholic beverages duty free if 
produced in a CBI beneficiary country.

Measures for Puerto Rico and U.S. insular possessions

    The CBERA contains a number of provisions to maintain and 
improve the competitive position of Puerto Rico and the U.S. 
insular possessions (including the Virgin Islands, American 
Samoa, Guam):
          (1) Imports from Puerto Rico and the Virgin Islands 
        may be counted toward the 35 percent minimum local 
        content rule of origin requirement for CBI duty-free 
        treatment. Section 235 of the Tariff and Trade Act of 
        1984 amended section 213(a) also to permit articles 
        from CBI beneficiary countries to enter under bond for 
        processing or manufacture in Puerto Rico without 
        payment of duty upon withdrawal if they meet CBI rule 
        of origin requirements. As amended by CBI II, any 
        article which is the growth, product, or manufacture of 
        Puerto Rico qualifies for duty-free treatment under the 
        CBI if (a) the article is imported directly from a CBI 
        beneficiary country into the United States; (b) the 
        article was advanced in value in a CBI beneficiary 
        country; and (c) if any materials are added to the 
        article in a CBI beneficiary country, such materials 
        are a product of a beneficiary country or the United 
        States.
          (2) The permissible foreign content was increased 
        from 50 to 70 percent for duty-free treatment of 
        imports of CBI eligible articles from U.S. insular 
        possessions.
          (3) Duty-free entry of alcoholic beverages by 
        returning U.S. residents arriving directly from insular 
        possessions was increased from 4 to 5 liters provided 
        at least 1 liter is the product of an insular 
        possession. CBI II increased the duty-free allowance 
        for U.S. residents returning from U.S. insular 
        possessions from $800 to $1,200.
          (4) Section 221 of the CBERA amended section 7652 of 
        the Internal Revenue Code to require that all excise 
        taxes collected on foreign rum imported into the United 
        States, whether or not from Caribbean countries, be 
        paid to the treasuries of Puerto Rico and the Virgin 
        Islands. Section 214(c) requires the President to 
        consider compensatory measures for the governments of 
        Puerto Rico and the Virgin Islands if there is a 
        reduction in the amount of rum excise tax rebates.
          (5) The term ``industry'' under the import relief 
        provisions of section 201 of the Trade Act of 1974 was 
        clarified to enable producers in the insular 
        possessions to petition for import relief.
          (6) Non-toxic rum stillage discharges in the Virgin 
        Islands are exempt from certain provisions of the 
        Federal Water Pollution Control Act if the discharges 
        are 1,500 feet from the shore and are determined by the 
        Governor of the Virgin Islands not to constitute a 
        health or environmental hazard.

Tax measures

    Section 222 of the CBERA amended section 274(h) of the 
Internal Revenue Code to allow deductions for business expenses 
incurred while attending conventions and meetings in a 
designated Caribbean Basin beneficiary country (or Bermuda) if 
the country enters into an executive agreement with the United 
States to provide, on a reciprocal basis, for information 
relating to U.S. tax matters to be made available to U.S. tax 
officials, including agreement to exchange bearer share and 
bank account information for criminal tax purposes. No 
deduction is available for attending a convention in a country 
found by the Secretary of the Treasury to discriminate in its 
tax laws against conventions held in the United States.
    Under section 936 of the Internal Revenue Code, qualified 
investment income earned in U.S. possessions is exempt from 
U.S. tax. Most of the tax benefits claimed under this provision 
are claimed by corporations in Puerto Rico. Prior to the Tax 
Reform Act of 1986 (1986 Act), this investment income, commonly 
referred to as ``qualified possessions source investment 
income'' or QPSII, had to be derived from sources inside Puerto 
Rico. Section 936(d)(4), added to the Code in the 1986 Act, 
amended the definition of QPSII to allow for investments 
outside of Puerto Rico. Under section 936(d)(4), interest 
income will qualify as QPSII if derived from loans by qualified 
financial institutions (including the Puerto Rican Government 
Development Bank) for the acquisition of active business assets 
and for the construction of development projects located in 
eligible Caribbean Basin countries. Section 227 of CBI II 
requires the government of Puerto Rico to take such steps as 
may be necessary to ensure that at least $100,000,000 of new 
investments which qualify under section 936(d)(4) in eligible 
Caribbean Basin countries shall be made each calendar year. 
Refinancings of existing investments shall not constitute ``new 
investments'' for this purpose.
    In general, section 1601y of the Small Business Job 
Protection Act of 1996: (1) repealed the QPSII exclusion 
effective July 1, 1996; (2) repealed the section 936 credit for 
new businesses effective for taxable years beginning after 
December 31, 1995; and (3) repealed the section 936 credit for 
existing possession businesses effective for taxable years 
beginning before January 1, 2006.\37\
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    \37\ Public Law 104-188, section 1601, approved August 20, 1996, 26 
U.S.C. 30A.
---------------------------------------------------------------------------

Tourism promotion and scholarship assistance

    Section 233 of CBI II required the Commissioner of Customs 
to carry out preclearance operations during fiscal years 1991 
and 1992 at a U.S. Customs Service facility in a Caribbean 
Basin country which the Commissioner considered appropriate for 
testing the extent to which the availability of preclearance 
operations can assist in the development of tourism in the 
region. The Commissioner of Customs and Commissioner of the 
Immigration and Naturalization Service were to first determine 
the viability of establishing such operations in either Aruba 
or Jamaica. The Commissioner of Customs was required to submit 
a report to the Congress as soon as practicable after September 
30, 1992, regarding the program, including the efficacy of 
extending preclearance operations to other Caribbean countries. 
In December 1994, the Customs Service signed a bilateral 
agreement with the government of Aruba regarding the future 
construction of a preclearance facility.
    Section 231 of CBI II requires the Administrator of the 
Agency for International Development (AID) to establish and 
administer a program of scholarship assistance, in cooperation 
with state governments, universities, community colleges, and 
businesses, to enable students (particularly the economically 
and socially disadvantaged) from CBI beneficiary countries that 
also receive U.S. foreign assistance to study in the United 
States. The Administrator may make grants to states (including 
the District of Columbia, Puerto Rico, and U.S. possessions and 
territories) to provide scholarship assistance for 
undergraduate degree programs and for training programs of at 
least 1 year in study areas related to the critical development 
needs of the students' respective countries. The federal share 
for each year for which a state receives payment will be not 
less than 50 percent, funded from amounts otherwise made 
available for Latin American and Caribbean regional programs 
under the economic support fund of the Foreign Assistance Act 
of 1961. To the maximum extent practicable, each participating 
state shall enlist private sector assistance to meet the non-
federal share of payments.

Meetings of Caribbean Trade Ministers and USTR

    CBTPA directs the President to convene a meeting with the 
trade ministers of partnership countries in order to establish 
a schedule of regular meetings, to commence as soon as 
practicable, of the trade ministers and USTR. The purpose of 
the meetings is to advance consultations between the United 
States and partnership countries concerning the likely timing 
and procedures for initiating negotiations for partnership 
countries to: (1) accede to NAFTA; or (2) enter into 
comprehensive, mutually advantageous trade agreements with the 
United States that contain comparable provisions to NAFTA, and 
would make substantial progress in achieving the negotiation 
objectives listed in Section 108(b)(5) of Public Law 103-182.

                           Andean Initiative

    The Andean Trade Preference Act (ATPA), commonly referred 
to as the Andean Initiative, was enacted on December 4, 1991 as 
title II of Public Law 102-182, to authorize preferential trade 
benefits for the Andean nations similar to those benefits to 
beneficiary countries under the Caribbean Basin Initiative 
program. On July 23, 1990, President Bush announced that he 
would seek congressional approval of a special preferential 
tariff program for four Andean countries--Bolivia, Ecuador, 
Colombia, and Peru--to fulfill a commitment made at the 
February 1990 Cartagena Drug Summit to expand economic 
incentives to encourage these countries to move out of the 
production, processing, and shipment of illegal drugs into 
legitimate products. Increased access to the U.S. market 
through tariff preferences was part of a package of measures 
that included expanded agricultural development assistance, 
additional product coverage under the Generalized System of 
Preferences program, and negotiation of long-term trade and 
investment liberalization building on the ``Enterprise for the 
Americas Initiative'' announced by the President on June 27, 
1990.
    On October 5, 1990, President Bush transmitted to Congress 
proposed implementing legislation. H.R. 661, the ``Andean Trade 
Preference Act of 1991,'' was introduced on January 28, 1991 
reflecting the Administration's proposal. The bill as reported 
to the House on November 19 was amended during consideration by 
the Committee on Ways and Means to conform the country 
designation criteria, rule-of-origin requirements, and the 
import relief and emergency relief criteria to the conditions 
and procedures for granting duty-free treatment under the CBI 
program. Certain preferential trade benefits, as well as the 
tax benefits under the CBI program, were maintained for the 
Caribbean Basin countries and not extended to the Andean 
countries by the legislation. The authority for the Andean 
Initiative was also limited to a 10-year period, to terminate 
as of December 4, 2001. H.R. 661 as amended was incorporated in 
a House amendment to a Senate amendment to H.R. 1724, passed by 
both Houses in a conference report on November 26, 1991.
    The ATPA went into effect on December 4, 1991. The 
designations of Columbia and Bolivia as ATPA beneficiary 
countries became effective July 22, 1992.\38\ Designations of 
Ecuador \39\ and Peru \40\ became effective, respectively, on 
April 30, 1993 and August 31, 1993.
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    \38\ Presidential Proclamation 6455 and 6456; 57 Fed. Reg. 30069 
and 30097.
    \39\ Presidential Proclamation 6544; 58 Fed. Reg. 195547.
    \40\ Presidential Proclamation 6585; 58 Fed. Reg. 43239.
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Beneficiary countries

    The ATPA authorizes the President to proclaim duty-free 
treatment on all eligible articles from Bolivia, Ecuador, 
Colombia, and Peru as potential beneficiary countries. 
Designation by the President of beneficiary status is subject 
to seven conditions identical to the mandatory criteria for 
designation under the CBI program and subject to the same 
authority to waive certain conditions in the U.S. national 
economic or security interest. A country is prohibited from 
designation under these conditions if it is a communist 
country, has nationalized or expropriated U.S. property without 
compensation or submission to arbitration, fails to recognize 
arbitral awards in favor of U.S. citizens, affords preferential 
tariff treatment to products of other developed countries 
having or likely to have a significant adverse effect on U.S. 
commerce, broadcasts U.S. copyrighted material without the 
owner's consent, has not signed an extradition agreement with 
the United States, or has or is not taking steps to afford 
internationally-recognized worker rights. In addition, the 
President must take into account 12 discretionary factors prior 
to designating any of the 4 countries, similar to factors under 
the CBI, plus whether the country has met narcotics cooperation 
certification criteria required to be eligible for U.S. foreign 
aid.
    Before designating any country, the President must notify 
the Congress of his intention to make the designation and the 
considerations entering into the decision. The President may 
withdraw or suspend beneficiary country status or duty-free 
treatment on any article if he determines subsequently that the 
country should be barred from designation as a result of 
changed circumstances.

Eligible articles

    Duty-free treatment is granted under the ATPA to any 
otherwise eligible article which is the growth, product, or 
manufacture of a designated beneficiary country if (1) that 
article is imported directly from a beneficiary country into 
the U.S. customs territory; and (2) the sum of the cost or 
value of materials produced in one or more Andean beneficiary 
countries or one or more CBI beneficiary countries, plus the 
direct costs of processing operations performed in one or more 
Andean or CBI beneficiary countries is not less than 35 percent 
of the appraised value of the article. Puerto Rico and the 
Virgin Islands are also considered beneficiary countries for 
this purpose. Up to 15 percent of the value attributable to the 
cost or value of materials produced in the United States may be 
applied toward the 35 percent minimum local content 
requirement. These rules and requirements to preclude 
transshipment or pass-through operations are identical to CBI 
provisions, except that content from CBI beneficiary countries 
may also be counted toward the minimum 35 percent local content 
requirement for determining the product of an Andean country.
    A statutory list of products that are ineligible for duty-
free treatment under the ATPA is also identical to the product 
exclusion list under the CBI except that rum is also excluded 
from ATPA eligibility in order to preserve preferential 
benefits for Caribbean, Virgin Islands, and Puerto Rican 
producers. Unlike under the CBI, duty-free treatment does not 
apply to imports of certain excluded articles assembled or 
processed wholly from U.S. components or materials.
    In addition to rum, ATPA duty-free treatment does not apply 
to textiles and apparel articles subject to textile agreements; 
footwear not designated eligible for GSP duty-free treatment; 
canned tuna; petroleum or petroleum products; certain watches 
and watch parts; certain leather-related products; and sugar, 
syrups, and molasses subject to over-quota rates of duty. As 
under the CBI and GSP programs, duty-free treatment applies 
only to imports of sugar entering within the tariff-quota 
level; over-quota sugar imports remain subject to a high 
tariff. As under the CBI, duty rate reductions of 20 percent, 
not to exceed 2.5 percent ad valorem, implemented in five equal 
annual stages beginning January 1, 1992, apply to imports of 
Andean leather-related products (handbags, luggage, flat goods, 
work gloves, and leather wearing apparel).

Import safeguard provisions

    Authorities under the ATPA to grant import relief measures 
and to take emergency action on imports of agricultural 
perishables are identical to provisions under the CBI program. 
The President may suspend duty-free treatment and proclaim a 
duty rate on any eligible article under the import relief 
provisions of the Trade Act of 1974 or the national security 
provisions of the Trade Expansion Act of 1962. The U.S. 
International Trade Commission must state in its report to the 
President on any import relief investigation involving an 
eligible article under the ATPA whether and to what extent its 
injury findings and remedy recommendations apply to imports of 
the article from beneficiary countries.
    Under an emergency relief procedure for agricultural 
perishables, petitions may be filed with the Secretary of 
Agriculture at the same time as a petition for import relief is 
filed with the ITC. Within 14 days, the Secretary advises the 
President whether he has reason to believe that a perishable 
product from a beneficiary country is being imported in such 
increased quantities as to be a substantial cause of serious 
injury or threat thereof to the domestic industry and that 
emergency action is warranted, or publishes notice and advises 
the petitioner of a determination not to recommend emergency 
action. Within 7 days after receiving a recommendation, the 
President must proclaim the withdrawal of duty-free treatment 
or publish notice of his determination not to take emergency 
action.
    No proclamation under the ATPA shall affect fees imposed 
pursuant to section 22 of the Agricultural Adjustment Act of 
1933.

Other provisions

    The ATPA increased the duty-free tourist allowance for U.S. 
residents returning from Andean beneficiary countries from $400 
to $600 and 1 additional liter of alcoholic beverages may enter 
duty free if produced in an Andean beneficiary country.
    The President must submit a triennial report to the 
Congress on the operation of the program. The ITC must report 
annually to the Congress on the economic impact of the ATPA on 
U.S. industries and consumers and on the effectiveness of duty-
free treatment in promoting drug-related crop eradication and 
crop substitution efforts of beneficiary countries. The 
Secretary of Labor must also report annually on the impact of 
the ATPA on U.S. labor.

                   African Growth and Opportunity Act

    The African Growth and Opportunity Act, commonly referred 
to as the African Trade Bill or AGOA, was enacted as title I of 
the Trade and Development Act of 2000 \41\, to authorize the 
grant of certain U.S. unilateral preferential trade benefits to 
sub-Saharan African countries pursuing political and economic 
reform.
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    \41\ Public Law 106-200, approved May 18, 2000.
---------------------------------------------------------------------------

Background

    Section 134 of the Uruguay Round Agreements Act (URAA) \42\ 
required the President to produce a comprehensive trade and 
development policy for African countries. The President's first 
report was submitted to Congress on February 5, 1996. Among 
other things, the President's report proposed the creation of 
the Africa Trade and Development Coordinating Group, an 
interagency group to be co-chaired by the National Security 
Council and the National Economic Council.
---------------------------------------------------------------------------
    \42\ Public Law 103-465, approved December 8, 1994, 19 U.S.C. 3554.
---------------------------------------------------------------------------
    On September 26, 1996, H.R. 4198 was introduced in the 
House of Representatives to authorize a new trade and 
investment policy for sub-Saharan Africa. The bill called for 
the designation of countries in sub-Saharan Africa pursuing 
market-based economic reform to participate in the benefits of 
the bill. H.R. 4198 proposed the creation of a United States-
Sub-Saharan Africa Trade and Economic Cooperation Forum to 
provide a regular opportunity for the discussion of trade 
liberalization among eligible countries and sought the 
establishment of a United States-Sub-Saharan Africa Free Trade 
Area. In addition, the bill provided for the elimination of 
quotas on textile and apparel products from Kenya and 
Mauritius, the only sub-Saharan African countries subject to 
quota on these products. No action was taken on H.R. 4198 in 
the 104th Congress.
    The second of the President's five reports pursuant to 
section 134 of the URAA was transmitted to Congress on February 
18, 1997. The report set forth a policy framework structured 
around five basic objectives, including trade liberalization 
and promotion, investment liberalization and promotion, 
development of the private sector, infrastructure enhancement, 
and economic reform.
    On April 24, 1997, H.R. 4198 was reintroduced in the 105th 
Congress as H.R. 1432, the African Growth and Opportunity Act. 
As introduced, H.R. 1432 included new language offering 
enhanced benefits under the Generalized System of Preferences 
(GSP) for sub-Saharan African countries meeting the bill's 
eligibility requirements.
    The third Presidential report required by section 134 of 
the URAA was submitted to Congress on December 23, 1997. The 
report indicated the Administration's strong support for the 
passage of H.R. 1432 and described the five major components of 
the Administration's Partnership for Economic Growth and 
Opportunity in Africa: (1) enhanced trade benefits; (2) 
technical assistance; (3) enhanced dialogue with African 
countries; (4) financing and debt relief; and (5) continued 
U.S. leadership in multilateral fora to support private sector 
development, trade development, and institutional capacity 
building in African countries.
    H.R. 432 was passed by the House of Representatives on 
March 11, 1998. No further action was taken on H.R. 1432 in the 
105th Congress, S. 2400 was introduced in the Senate on July 
21, 1998. Title I of S. 2400 was entitled the African Growth 
and Opportunity Act and differed primarily from H.R. 1432 by 
imposing a requirement that imports of textile and apparel 
products from sub-Saharan Africa qualifying for duty-free and 
quota-free entry be made from fabric of U.S. origin. S. 2400 
was not considered by the Senate during the 105th Congress.
    On January 15, 1999, the President's fourth report pursuant 
to the URAA was submitted to Congress. The President's report 
indicated the Administration's continued support for the 
passage of the African Growth and Opportunity Act and laid out 
the key policy objectives of the President's Partnership for 
Economic Growth and Opportunity in Africa for stimulating 
economic growth in sub-Saharan Africa and facilitating the 
region's integration into the global economy.
    On February 2, 1999, H.R. 1432 was reintroduced in the 
106th Congress as H.R. 434, H.R. 434 was passed by the House of 
Representatives on July 16, 1999.
    On July 16, 1999, S. 1387, also entitled the African Growth 
and Opportunity Act, was introduced in the Senate. The text of 
S. 1387 was similar to title I of S. 2400 from the 105th 
Congress.
    On November 3, 1999, the Senate passed H.R. 434, as 
amended. During Senate consideration of the bill, the House-
passed version of the African Growth and Opportunity Act was 
replaced with the text of S. 1387. H.R. 434 was passed by the 
Senate as the Trade and Development Act of 2000, with title I 
comprising the African Growth and Opportunity Act.
    On January 21, 2000, the President submitted his fifth and 
final report required by section 134 of the URAA. The 
President's report reiterated the Administration's support for 
enactment of H.R. 434. In addition, it described the ways the 
U.S. Government agencies work to support economic reform in 
sub-Saharan Africa, enhance U.S.-sub-Saharan African economic 
engagement, increase African integration into the multilateral 
trading system, and promote sustainable economic development.
    On May 4, 2000, the conference report on H.R. 434, the 
Trade and Development Act of 2000, was filed (H. Rept. 106-606) 
and passed by the House of Representatives. The African Growth 
and Opportunity Act was contained in title I of the conference 
report. The Senate passed the conference report on May 11, 
2000. The bill was signed into law by the President on May 18, 
2000 (P.L. 106-200). The trade provisions in the African Growth 
and Opportunity Act have an effective date of October 1, 2000 
through September 30, 2008.

Beneficiary Countries

    Section 107 of the African Growth and Opportunity Act 
(AGOA) lists the following 48 countries, or their successor 
political entities, as potentially eligible for designation by 
the President as beneficiary countries:

Angola             Eritrea             Nigeria
Benin              Ethiopia            Republic of Congo
Bostswana          Gabon               Rwanda
Burkina Faso       Gambia              Sao Tome and 
Burundi            Ghana                 Principe
Cameroon           Guinea-Bissau       Senegal
Cape Verde         Kenya               Seychelles
Central African    Lesotho             Sierra Leone
  Republic         Liberia             Somalia
Chad               Madagascar          South Africa
Comoros            Malawi              Sudan
Democratic         Mali                Swaziland
  Republic of      Mauritania          Tanzania
  Congo            Mauritius           Togo
Cote d'Ivoire      Mozambique          Uganda
Djibouti           Namibia             Zambia
Equatoria Guinea   Niger               Zimbabwe

    Section 111(a) of AGOA amends title V of the Trade Act of 
1974 by inserting a new section 506A on the designation of sub-
Saharan African countries for the benefits of the Act. The new 
section 506A authorizes the President to designate a country 
listed in section 107 of AGOA as a beneficiary sub-Saharan 
African country if: (1) the President determines that the 
country meets the eligibility requirements set forth in section 
104 of AGOA in effect on the date of enactment; and (2) the 
country otherwise meets the GSP eligibility criteria.\43\
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    \43\ Presidential Proclamation 7350 of October 2, 2000 (65 (Fed. 
Reg. 59321, October 4, 2000) designated 34 countries in sub-Saharan 
African as beneficiary sub-Saharan African countries for the purposes 
of AGOA. All countries listed above except Angola, Burkina Faso, 
Burundi, Comoros, Democratic Republic of Congo, Cote d'Ivoire, 
Equatorial Guinea, Gambia, Liberia, Somalia, Sudan, Swaziland, Togo, 
and Zimbabwe were designated by Presidential Proclamation 7350, 
Swaziland was designated as a beneficiary country for the purposes of 
AGOA by Presidential Proclamation 7400 of January 17, 2001 (66 Fed. 
Reg. 7373, January 23, 2001).
---------------------------------------------------------------------------
    Section 104(a) of AGOA, as enacted, authorizes the 
President to designate a sub-Saharan African country as an 
eligible sub-Saharan African country if the President 
determines that the country has established, or is making 
continual progress toward establishing:
          (1) a market-based economy that protects private 
        property rights, incorporates an open rules-based 
        trading system, and minimizes government interference 
        in the economy through measures such as price controls, 
        subsidies, and government ownership of economic assets;
          (2) the rule of law, political pluralism, and the 
        right to due process, a fair trial, and equal 
        protection under the law;
          (3) the elimination of barriers to United States 
        trade and investment, including by:
            (A) the provision of national treatment and 
        measures to create and environment conducive to 
        domestic and foreign investment;
            (B) the protection of intellectual property; and
            (C) the resolution of bilateral trade and 
        investment disputes;
          (4) economic policies to reduce poverty, increase the 
        availability of health care and educational 
        opportunities, expand physical infrastructure, promote 
        the development of private enterprise, and encourage 
        the formation of capital markets through micro-credit 
        or other programs;
          (5) a system to combat corruption and bribery, such 
        as signing and implementing the Convention on Combating 
        Bribery of Foreign Public Officials in International 
        Business Transactions; and
          (6) protection of internationally recognized worker 
        rights, including the right of association, the right 
        to organize and bargain collectively, a prohibition on 
        the use of any form of forced or compulsory labor, a 
        minimum age for the employment of children, and 
        acceptable conditions of work with respect to minimum 
        wages, hours of work, and occupational safety and 
        health.
    In designating a country as an eligible sub-Saharan African 
country, the President must also find under section 104(a) that 
it: (1) does not engage in activities that undermine U.S. 
national security or foreign policy interests; and (2) does not 
engage in gross violations of internationally recognized human 
rights or provide support for acts of international terrorism 
and cooperates in international efforts to eliminate human 
rights violations and terrorist activities.
    If the President determines that a beneficiary sub-Saharan 
African country is not making continual progress in meeting the 
eligibility requirements, then under section 506A(a)(3) of the 
Trade Act of 1974 the President must terminate the designation 
of that country as a beneficiary sub-Saharan African country 
effective on January 1, of the year following the year in which 
the determination is made.
    The President is required under section 106 of AGOA to 
submit a comprehensive report to Congress, not late than 1 year 
after the date of enactment of AGOA, and annually thereafter 
through 2008, on the trade and investment policy of the United 
States for sub-Saharan Africa and on the implementation of AGOA 
and the amendments made by it. Section 506A(c) of the Trade Act 
of 1974 requires the President to include his country 
eligibility determinations, along with explanations of his 
determinations and specific analysis of the eligibility 
requirements, in the annual report.

Eligible articles

    Section 111(A) of AGOA amends the GSP provisions in title V 
of the Trade Act of 1974 by inserting a new section 506A. 
Section 506A(b)(1) of the Trade Act of 1974 authorizes the 
President to provide duty-free treatment for imports from 
beneficiary sub-Saharan African countries of any article, other 
than textiles or apparel products or textile luggage, that is 
designated as import sensitive under the GSP statute, provided 
that, after receiving advice from the U.S. International Trade 
Commission (ITC), the President determines that the article is 
not import sensitive in the context of imports from beneficiary 
sub-Saharan African countries.\44\ The general rules of origin 
governing duty-free entry under GSP apply, except that, in 
determining whether products are eligible for the enhanced 
benefits of AGOA, up to 15 percent of the appraised value of a 
product at the time of importation may be derived from material 
produced in the United States. In addition, under section 
506A(b)(2) of the Trade Act of 1974, the cost or value of 
materials produced in any beneficiary sub-Saharan African 
country may be applied in determining whether a product meets 
the applicable rules of origin for the enhanced GSP benefits of 
AGOA. Section 111(b) of AGOA amends GSP to waive permanently 
the competitive need limits that would otherwise apply to 
beneficiary sub-Saharan African countries. Section 114 of AGOA 
inserts a new section 506B in the Trade Act of 1974 providing 
that the enhanced GSP benefits for sub-Saharan African 
countries are in effect through September 30, 2008.
---------------------------------------------------------------------------
    \44\ Presidential Proclamation 7388 of December 18, 2000 (65 Fed. 
Reg. 80723, December 21, 2000) lists the articles determined by the 
President to be non-import sensitive in the context of imports from 
beneficiary sub-Saharan African countries and therefore eligible for 
duty-free treatment under the enhanced GSP benefits in AGOA.
---------------------------------------------------------------------------
    Section 112 of AGOA provides preferential treatment to 
certain textile and apparel articles imported directly into the 
customs territory of the United States from beneficiary sub-
Saharan African countries meeting the transshipment 
requirements set forth in section 113 of AGOA (see description 
below). Under section 112(b), the following textile and apparel 
articles may enter the United States free of duty and 
quantitative restrictions:
          (1) apparel articles assembled in one or more 
        beneficiary sub-Saharan African countries from fabrics 
        wholly formed and cut in the United States, from yarns 
        wholly formed in the United States;
          (2) apparel articles cut and assembled in one or more 
        beneficiary sub-Saharan African countries from fabrics 
        wholly formed in the United States from yarns wholly 
        formed in the United States, and assembled with thread 
        formed in the United States;
          (3) sweaters knit-to-shape in one or more beneficiary 
        sub-Saharan African countries made from cashmere and 
        fine merino wool;
          (4) apparel articles both cut (or knit-to-shape) and 
        sewn, or otherwise assembled, in one or more 
        beneficiary sub-Saharan African countries from fabric 
        or yarn not formed in the United States or a 
        beneficiary sub-Saharan African country, to the extent 
        that apparel articles of such fabrics or yarns would be 
        eligible for preferential treatment, without regard to 
        the source of the fabric or yarn, under Annex 401 of 
        the North American Free Trade Agreement (NAFTA); and
          (5) certified handloomed, handmade and folklore 
        articles.\45\
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    \45\ Executive Order 13191 of January 17, 2001 (66 Fed. Reg. 7271, 
January 22, 2001) delegated authority to the Committee for the 
Implementation of Textile Agreements (CITA), after consultation with 
the Commissioner of the U.S. Customs Service, to consult with 
beneficiary sub-Saharan African countries and to determine which, if 
any, particular textile and apparel goods shall be treated as being 
handloomed, handmade, or folklore articles for the purposes of section 
112(b)(6) of AGOA.
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    Section 112b(b)(3) of AGOA also provides that certain other 
apparel articles, up to 1.5% of total U.S. apparel imports (in 
square meter equivalents) for the first year of the bill, 
growing in equal increments in each of the seven succeeding 
one-year periods, to a maximum of 3.5% of U.S. apparel imports 
in the last year of the bill, may enter the customs territory 
of the United States from beneficiary sub-Saharan African 
countries free of duty and quantitative restrictions. The 
following apparel articles are eligible for preferential 
treatment under this cap:
          (1) through September 30, 2004, apparel articles 
        wholly assembled in one or more lesser developed 
        beneficiary sub-Saharan African countries (defined as 
        beneficiary sub-Saharan African countries with a per 
        capita gross national product of less than $1,500 in 
        1998, as measured by the World Bank),\46\ without 
        regard to the origin of the fabric; and
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    \46\ Presidential Proclamation 7350of October 2, 2000 (65 Fed. Reg. 
59321, October 4, 2000) lists designated beneficiary sub-Saharan 
African countries to be considered as lesser developed beneficiary sub-
Saharan African countries for the purposes of section 112(b)(3)(B) of 
AGOA. They are: Benin, Cape Verde, Cameroon, Central African Republic, 
Chad, Republic of Congo, Djibouti, Eritrea, Ethiopia, Ghana, Guinea, 
Guinea-Bissau, Kenya, Lesotho, Madagascar, Malawi, Mali, Mauritania, 
Mozambique, Nigher, Nigeria, Rwanda, Sao Tome and Principe, Senegal, 
Sierra Leone, Tanzania, Uganda, and Zambia. Swaziland was also 
designated as a lesser developed beneficiary sub-Saharan African 
country for the purposes of AGOA by Presidential Proclamation 7400 of 
January 17, 2001 (66 Fed. Reg. 7373, January 23, 2001).
---------------------------------------------------------------------------
          (2) apparel articles wholly assembled in one or more 
        beneficiary sub-Saharan African countries from fabric 
        wholly formed in one or more beneficiary countries from 
        yarn originating either in the United States or in one 
        or more beneficiary countries.
    Section 112(b)(3)(C) provides import relief within the cap 
in the form of a tariff snapback if the Secretary of Commerce 
determines that an article qualifying for duty-free treatment 
under the cap from a single beneficiary sub-Saharan African 
country is being imported in such increased quantities and 
under such conditions as to cause ``serious damage, or threat 
thereof'' to the domestic industry producing the like or 
directly competitive article. In determining whether a domestic 
industry has been seriously damaged, or is threatened with 
serious damage, the Secretary is required to examine the effect 
of the imports on relevant economic indicators such as domestic 
production, sales, market share, capacity utilization, 
inventories, employment, profits, exports, prices, and 
investment.
    The Secretary of Commerce is required to made a 
determination on whether import relief is warranted if there 
has been a surge in imports under the cap from a single 
beneficiary sub-Saharan African country based on import data. 
The Secretary is also required to initiate such an inquiry 
within 10 days of receiving a written request and supporting 
information from an interested party. Notice of the initiation 
of an inquiry, and the Secretary's subsequent determination, 
are to be published in the Federal Register. The Secretary of 
Commerce is required to establish procedures to ensure 
participation in the inquiry by interested parties. If relevant 
information is not available on the record or any party 
withholds information that has been requested by the Secretary, 
the Secretary can make the determination on the basis of the 
facts available. When the Secretary relies on information 
submitted in the inquiry as facts available, the Secretary 
must, to the extent practicable, corroborate the information 
from independent sources that are reasonably available.
    Section 112(b)(3)(C) defines the term ``interested party'' 
for the purposes of the subparagraph as: (1) any producer of a 
like or directly competitive article; (2) a certified union or 
recognized union or group or workers which is representative of 
an industry engaged in the manufacture, production or sale in 
the United States of a like or directly competitive article; 
(3) a trade or business association representing producers or 
sellers of like or directly competitive articles; (4) producers 
engaged in the production of essential inputs for like or 
directly competitive articles; (5) a certified union or group 
of workers which is representative of an industry engaged in 
the manufacture, production or sale of essential inputs for 
like or directly competitive articles; (5) a certified union or 
group of workers which is representative of an industry engaged 
in the manufacture, production or sale of essential inputs for 
like or directly competitive articles; or (6) a trade or 
business association representing companies engaged in the 
manufacture, production or sale of such essential inputs.
    Section 112(b)(5)(B) of AGOA authorizes the President, at 
the request of any interested party and subject to certain 
requirements, to proclaim duty-free and quota-free treatment 
for apparel articles both cut (or knit-to-shape) and sewn or 
otherwise assembled in one or more beneficiary sub-Saharan 
African countries, from fabric or yarn not formed in the United 
States or a beneficiary sub-Saharan African country (in 
addition to those fabrics and yarns already listed in Annex 401 
of the NAFTA) if:
          (1) the President determines that such yarns or 
        fabrics cannot be supplied by the domestic industry in 
        commercial quantities in a timely manner;\47\
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    \47\ Executive Order 13191 of January 17, 2001 (66 Fed. Reg. 7271, 
January 22, 2001) delegated authority to CITA to determine whether 
yarns or fabrics cannot be supplied by the domestic industry in 
commercial quantities in a timely manner for the purposes of section 
112(b)(5)(B)(i) of AGOA.
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    The President has obtained advice regarding the proposed 
action from the appropriate advisory committee established 
under section 135 of the Trade Act of 1974 \48\ and the ITC;
---------------------------------------------------------------------------
    \48\ 19 U.S.C. 2155.
---------------------------------------------------------------------------
          (3) within 60 calendar days after the request, the 
        President has submitted a report to the Committee on 
        Ways and Means in the House of Representatives and the 
        Committee on Finance in the Senate that sets forth:
            (A) the action proposed to be proclaimed and the 
        reasons for such action; and
            (B) the advice obtained from the advisory committee 
        and the ITC;
          (4) a period of 60 calendar days, beginning with the 
        first day on which the President has met the reporting 
        requirements has expires; and
          (5) the President has consulted with such committees 
        regarding the proposed action during the 60 day period.
    Section 112(c) of AGOA provides for the elimination of 
quotas on textile and apparel exports to the United States from 
Kenya and Mauritius within 30 days after the countries adopt 
efficient visa systems to guard against unlawful transshipment 
of textile and apparel goods and the use of counterfeit 
documents related to the importation of such articles into the 
United States.\49\ The U.S. Customs Service is required to 
provide technical assistance to Kenya and Mauritius in the 
development and implementation of the visa systems.
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    \49\ Presidential Proclamation 7350 of October 2, 2000 (65 Fed. 
Reg. 59321, October 4, 2000) delegated authority to perform the 
functions specified in section 112(c) of AGOA to USTR.
---------------------------------------------------------------------------
    With regard to findings and trimmings, section 112(d)(1)(A) 
and AGOA provides that an article eligible for preferential 
treatment shall not be ineligible for such treatment because it 
contains findings or trimmings of foreign origin, if the value 
of such findings and trimmings does not exceed 25 percent of 
the costs of the components of the assemble article. Examples 
of findings and trimmings are sewing thread, hooks and eyes, 
snaps, buttons, ``bow buds,'' decorative lace trim, elastic 
strips, and zippers, including zipper tapes and labels. Elastic 
strips are considered findings or trimmings only if they are 
each less then one inch in width and used in the production of 
brassieres. For apparel articles free of duty and quantitative 
restrictions under AGOA by virtue of being cut and assembled in 
one or more beneficiary sub-Saharan African countries from 
fabrics wholly formed in the United States from yarn formed in 
the United States and assembled with U.S. thread, sewing thread 
is not included in the findings and trimmings exception.
    On certain interlinings of foreign origin, section 
112(d)(1)(B) provides that an apparel article otherwise 
eligible for preferential treatment shall not be ineligible 
because it contains such interlinings, if their value (and any 
findings and trimmings) does not exceed 25 percent of the cost 
of the components of the assembled article. Interlinings 
eligible for such treatment are defined are defined as a chest 
type plate, a ``hymo'' piece, or ``sleeve header,'' of woven or 
weft-inserted warp knit construction and of coarse animal hair 
or man-made filaments. This treatment must be terminated if the 
President makes a determination that U.S. manufacturers are 
producing such interlinings in the United States in commercial 
quantities.\50\
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    \50\ Executive Order 13191 of January 17, 2001 (66 Fed. Reg. 7271, 
January 22, 2001) delegated authority to the CITA to determine whether 
U.S. manufacturers are producing interlinings in the United States in 
commercial quantities for the purposes of section 112(d)(1)(B)(iii) of 
AGOA. The Executive Order further directs CITA to establish procedures 
to ensure appropriate public participation in such determination and 
requires that CITA's determinations under the provision be published in 
the Federal Register.
---------------------------------------------------------------------------
    A de minims rule is also established in section 112(d)(2) 
to provide that an article otherwise eligible for preferential 
treatment shall not be ineligible for such treatment because 
the article contains fibers or yarns not wholly formed in the 
United States or one or more beneficiary sub-Saharan African 
countries if the total weight of all such fibers and yarns is 
not more than seven percent of the total weight of the article.

Protections against transshipment

    Section 113(a) of AGOA provides that the preferential 
treatment provided to textile and apparel articles in section 
112(a) shall not be extended to imports from a beneficiary sub-
Saharan African country unless that country:\51\
---------------------------------------------------------------------------
    \51\ Presidential Proclamation 7350 of October 2, 2000 (65 Fed. 
Reg. 59321, October 4, 2000) delegated authority to make the findings 
identified in section 113(a) of AGOA to USTR.
---------------------------------------------------------------------------
          (1) has adopted an efficient visa system, domestic 
        laws, and enforcement procedures applicable to covered 
        articles to prevent unlawful transshipment and the use 
        of counterfeit documents related to the entry of the 
        articles into the United States;\52\
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    \52\ Executive Order 13191 of January 17, 2001 (66 Fed. Reg. 7271, 
January 22, 2001) delegated authority to USTR to direct the 
Commissioner of the U.S. Customs Service to take such actions as may be 
necessary to ensure that textile and apparel articles described in 
section 112(b) of AGOA that are entered, or withdrawn from warehouse, 
for consumption are accompanied by an appropriate export visa if the 
preferential treatment described in section 112(a) of AGOA is claimed 
with respect to such articles.
---------------------------------------------------------------------------
          (2) has enacted legislation or promulgated 
        regulations to permit U.S. Customs Service verification 
        teams to have the access necessary to investigate 
        thoroughly allegations of transshipment;
          (3) agrees to report, on a timely basis, export and 
        import information requested by the U.S. Customs 
        Service;
          (4) will cooperate fully with the U.S. Customs 
        Service to prevent circumvention and transshipment as 
        provided in Article 5 of the WTO Agreement on Textiles 
        and Clothing;\53\
---------------------------------------------------------------------------
    \53\ Article 5 of the WTO Agreement on Textiles and Clothing 
provides that cooperation to prevent circumvention transshipment 
includes: investigation of circumvention practices; exchange of 
documents, correspondence, reports, and other relevant information to 
the extent available; and facilitation of plant vists and contacts.
---------------------------------------------------------------------------
          (5) agrees to require all producers and exporters of 
        covered articles in that country to maintain complete 
        records of the production and the export of covered 
        articles, including materials used in the production, 
        for at least two years after the production or export; 
        and
          (6) agrees to report on a timely basis, at the 
        request of the U.S. Customs Service, documentation 
        establishing the country of origin of covered articles 
        as used by that country in implementing an effective 
        visa system.
    Section 113(A) defines country of origin documentation to 
include documentation such as production records, information 
relating to the place of production, the number and 
identification of the types of machinery used to production, 
the number of workers employed in production, and certification 
from both the manufacturer and the exporter.
    Section 113(b)(1) requires importers to comply with U.S. 
Customs Service requirements similar in all material respects 
to the requirements regarding Certificates of Origin contained 
in Article 502.1 of the NAFTA for a similar importation from a 
NAFTA partner.\54\ Furthermore, in order to qualify for 
preferential treatment and for a Certificate of Origin to be 
valid with respect to any article for which preferential 
treatment is claimed, the President is required to determine 
that each country has implemented and follows, or is making 
substantial progress toward implementing and following, 
procedures similar in all material respects to the relevant 
procedures and requirements under chapter 5 of the NAFTA on 
Customs Procedures.\55\ Section 113(b)(2) states that the 
Certificate of Origin is not required if such Certificate of 
Origin would not be required under Article 503 of the NAFTA (as 
implemented into U.S. Law) if the article were imported from 
Mexico.\56\ Under section 113(b)(3), if the President 
determines, based on sufficient evidence, that an exporter has 
engaged in transshipment, then the President is required to 
deny for a period of five years all benefits under section 112 
of AGOA to such exporter, any successor, and any other entity 
owned or operated by the principal of the exporter.\57\
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    \54\ Article 502.1 of the NAFTA requires an importer that claims 
preferential tariff treatment for a good imported into its territory 
from the territory of another Party to: (1) make a written declaration, 
based on a valid Certificate of Origin, that the good qualifies as an 
Originating good; (2) have the Certificate in its possession at the 
time the declaration is made; (3) provide, on the request of that 
Party's customs administration, a copy of the Certificate; and (4) 
promptly make a corrected declaration and pay any duties owed where the 
importer has reason to believe that a Certificate on which a 
declaration was based contains information that is not correct.
    \55\ Presidential Proclamation 7350 of October 2, 2000 (65 Fed. 
Reg. 59321) delegated authority to perform the functions specified in 
section 113(b)(1)(B) of AGOA to USTR.
    \56\ Article 503 of the NAFTA provides an exemption from the 
Certificate of Origin requirements for: (1) a commercial importation of 
a good whose value does not exceed $1,000, or such higher amount that a 
Party may establish, except that it may require that the invoice 
accompanying the importation include a statement certifying that the 
good qualifies as an originating good; (2) a non-commercial importation 
of a good whose value does not exceed $1,000, or such higher amount 
that a Party may establish; or (3) an importation of a good for which 
the NAFTA partner into whose territory the good is imported has waived 
the requirement for a Certificate of Origin. These exceptions are 
permitted provided that the importation does not form part of a series 
of importations that may reasonably be considered to have been 
undertaken or arranged for the purpose of avoiding the Certificate of 
Origin requirements.
    \57\ Executive Order 13191 of January 17, 2001 (66 Fed. Reg. 7271, 
January 22, 2001) delegated authority to CITA to determine, after 
consultation with the Commissioner of the U.S. Customs Service, based 
on sufficient evidence, whether an exporter has engaged in 
transshipment and to deny for a period of five years all benefits under 
section 112 of AGOA to any such exporter, any successor of such 
exporter, and any other entity owned or operated by the principal of 
such exporter. The Executive Order further requires CITA to publish its 
determinations under this section in the Federal Register.
---------------------------------------------------------------------------
    Transshipment is defined to have occurred in section 
113(b)(4) when preferential treatment for a textile or apparel 
article has been claimed under AGOA on the basis of material 
false information concerning the country of origin, 
manufacture, processing, or assembly of the article or any of 
its components. False information is material if disclosure of 
the true information would mean or would have meant that the 
article is or was ineligible for preferential treatment.
    Section 113(b)(5) requires the U.S. Customs service to 
monitor and the Commissioner of Customs to report to Congress 
on an annual basis beginning no later than March 31, 2001 on 
the effectiveness of the visa systems, the implementation of 
legislation and regulations described by sub-Saharan African 
countries, and the measures taken to deter circumvention as 
described in Article 5 of the WTO Agreement on Textiles and 
Clothing.
    Section 113(c) requires the U.S. Customs Service to provide 
technical assistance to beneficiary sub-Saharan African 
countries in the development and implementation of effective 
visa systems and domestic laws. In addition, the U.S. Customs 
Service is required to provide assistance in training sub-
Saharan African officials in anti-transshipment enforcement and 
to the extent feasible, in developing and adopting electronic 
visa systems. The U.S. Customs Service is also required in 
section 113(c) to send production verification teams to at 
least four beneficiary sub-Saharan African countries each year. 
Section 113(d) authorizes additional resources to the U.S. 
Customs Service to provide technical assistance to sub-Saharan 
African countries and to increase transshipment enforcement.

United States-Sub-Saharan Africa Trade and Economic Cooperation Forum

    In order to foster close economic ties between the United 
States and sub-Saharan Africa, section 105 of AGOA requires the 
President to convene annual high-level meetings between 
appropriate officials of the United States Government and 
officials of the governments of sub-Saharan African countries. 
Not later than 12 months after the date of enactment,\58\ the 
President, after consulting with Congress and the governments 
concerned, is required to establish a United States-Sub-Saharan 
Africa Trade and Economic Cooperation Forum.
---------------------------------------------------------------------------
    \58\ Public Law 106-200, approved May 18, 2000.
---------------------------------------------------------------------------
    In creating the Forum, section 105(c)(1) requires the 
President to direct the Secretary of Commerce, the Secretary of 
the Treasury, the Secretary of State, and the USTR to host the 
first annual meeting with their counterparts from the 
governments of sub-Saharan African countries meeting the 
eligibility criteria in section 104. The purpose of the meeting 
is to discuss expanding trade and investment relations between 
the United States and sub-Saharan Africa and the implementation 
of AGOA, including encouraging joint ventures between small and 
large businesses. The President is also required to direct the 
Secretaries and the USTR to invite to the meeting 
representatives from appropriate sub-Saharan African regional 
organizations and government officials from the other 
appropriate countries in sub-Saharan Africa.
    Section 105(c)(2) requires the President, in consultation 
with Congress, to encourage U.S. nongovernmental organization 
(NGOs) to host annual meetings with NGOs from sub-Saharan 
Africa in conjunction with the annual Forum meetings. Section 
105(c)(3) requires the President, in consultation with 
Congress, to encourage similar meetings between representatives 
of the U.S. and sub-Saharan African private sector.
    Under section 105(c)(3), the President is required to meet, 
to the extent practicable, with the heads of governments of 
sub-Saharan African countries eligible under section 104, and 
those sub-Saharan African countries that the President 
determines are taking substantial positive steps toward meeting 
those eligibility requirements, not less than once every two 
years for the purpose of discussing expanding trade and 
investment relations between the United States and sub-Saharan 
African and the implementation of AGOA, including encouraging 
joint ventures between small and large businesses.

Free trade agreements with sub-Saharan African countries

    Congress declares in Section 116 of AGOA that free trade 
agreements should be negotiated, where feasible, with 
interested countries in sub-Saharan Africa, in order to serve 
as the catalyst for increasing trade between the United States 
and sub-Saharan Africa and increasing private sector investment 
in sub-Saharan Africa.
    Section 116(b)(1) requires the President, taking into 
account the provisions of the treaty establishing the African 
Economic Community and the willingness of the governments of 
sub-Saharan African countries to engaged in negotiations to 
enter into free trade agreements, to prepare and transmit to 
Congress not later than 12 months after the date of enactment 
\59\ a plan for the purpose of negotiating and entering into 
one or more trade agreements with interested beneficiary sub-
Saharan African countries.
---------------------------------------------------------------------------
    \59\ Public Law 106-200, approved May 18, 2000.
---------------------------------------------------------------------------

                           Customs Valuation


Historical background

    In order to assess applicable duty rates under the 
Harmonized Tariff Schedule of the United States (HTS) and to 
collect appropriate import statistics, the dutiable value of 
all imported merchandise must be determined. The process by 
which Customs determines the dutiable value of imported 
merchandise is referred to as ``appraisement'' or 
``valuation.''
    Merchandise exported to the United States on or after July 
1, 1980, is subject to appraisement under a uniform system of 
valuation established by title II of the Trade Agreements Act 
of 1979. Title II, which implements the Customs Valuation 
Agreement (entitled the Agreement on Implementation of Article 
VII of the General Agreement on Tariffs and Trade) negotiated 
as one of the Tokyo Round of multilateral trade negotiations 
(MTN) agreements, was put into effect by Presidential 
Proclamation 4768 of June 28, 1980.\60\
---------------------------------------------------------------------------
    \60\ 45 Fed. Reg. 45135 (1980).
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    Title II revised section 402 of the Tariff Act of 1930 \61\ 
and repealed the American Selling Price (ASP) method of 
valuation. However, under section 204(c) of the Trade 
Agreements Act of 1979, the ASP method of valuation continues 
to apply to certain rubber footwear exported to the United 
States before July 1, 1981. Title II also repealed the 
alternative valuation system under section 402a of the Tariff 
Act of 1930.\62\
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    \61\ 19 U.S.C. 1401a.
    \62\ 19 U.S.C. 1402.
---------------------------------------------------------------------------
    Prior to the Trade Agreements Act of 1979, separate 
valuation standards--commonly referred to as the ``old law'' 
and the ``new law''--existed side by side. Section 402a of the 
Tariff Act of 1930 was called the ``old law'' because it was 
enacted as part of the Tariff Act of 1930. It provided for the 
following order of progression in appraising merchandise: (1) 
foreign value or export value, whichever is higher; (2) U.S. 
value; (3) cost of production. It also provided for the 
application of the ASP basis of appraisement for designated 
articles such as benzenoid chemicals and certain footwear. The 
ASP method was based on the value of a domestic product rather 
than an imported product in order to protect the U.S. industry 
from foreign competition.
    During the early 1950's the Department of the Treasury 
proposed eliminating the foreign value basis of appraisement, 
which as its name implies is based on the value of merchandise 
sold in foreign markets. The Department of the Treasury argued 
that data for determining export value were more readily 
available and the elimination of foreign value would streamline 
the appraisement process by obviating the need to make 
simultaneous appraisements under export value and foreign 
value.
    In response to these proposals, the Customs Simplification 
Act of 1956 created a new group of valuation standards. These 
standards were contained in section 402 of the Tariff Act of 
1930 \63\ and referred to as the ``new law.'' The ``new law'' 
eliminated the foreign value standard and made export value the 
primary basis for appraisement. With certain modifications, 
both U.S. value and cost of production (renamed the constructed 
value) were retained as the first and second alternative 
standards. The meaning of each standard was modified, however, 
by changes in the statutory language and by the inclusion in 
the law of definitions for certain of the terms.
---------------------------------------------------------------------------
    \63\ 19 U.S.C. 1401a.
---------------------------------------------------------------------------
    However, Congress was unwilling to make these changes 
applicable to all imported articles. Because the new provisions 
were expected to have a duty-reducing effect for many articles, 
the Secretary of the Treasury was instructed to prepare a list 
of commodities which, if appraised under the new valuation 
standards, would have been appraised at 95 percent or less of 
the value at which they were actually appraised in the 12 
months ending June 30, 1954 (i.e., dutiable value reduced by 5 
percent or more). The articles so identified were published in 
Treasury Decision 54521 (January 20, 1958), which is referred 
to as ``the Final List'' and such articles continued to be 
appraised under the ``old law'' standards of section 402a of 
the Tariff Act. Thus, after the enactment of the Customs 
Simplification Act of 1956,\64\ there were nine separate bases 
of appraisement (five under the old law and four under the new) 
applicable to imported products.
---------------------------------------------------------------------------
    \64\ Act of August 2, 1956, ch. 887.
---------------------------------------------------------------------------
    It was largely this complexity of U.S. valuation laws as 
well as foreign objections to the American Selling Price basis 
of appraisement which prompted our trading partners to enter 
into negotiations at the Tokyo Round of MTN on the development 
of a new system of customs valuation.

                The GATT/WTO Customs Valuation Agreement

    The Customs Valuation Agreement was signed by most major 
U.S. trading partners at the conclusion of the Tokyo Round. The 
WTO Agreement on Customs Valuation, which is essentially the 
same document, is included in the Uruguay Round Agreements 
applicable to all WTO members. Internationally-agreed rules 
governing customs valuation will apply to the overwhelming 
majority of trading countries. Newly joining developing 
countries may delay implementation for up to 5 years.
    The Agreement consists of four major parts in addition to a 
preamble and three annexes. Part I sets out the substantive 
rule of customs valuation, the substance of which was codified 
in U.S. law by the Trade Agreements Act of 1979 as an amendment 
to section 402 of the Tariff Act of 1930. Part II provides for 
the international administration of the Agreement and for 
dispute resolution among signatories. Part III provides for 
special and differential treatment for developing countries, 
and part IV contains so-called final provisions dealing with 
matters such as acceptance and accession of the Agreement, 
reservations, and servicing of the Agreement.
    Administration and dispute resolution.--As mentioned above, 
the Agreement establishes two committees--a ``Committee on 
Customs Valuation'' (referred to as ``the Committee'') and a 
``Technical Committee on Customs Valuation'' (referred to as 
the ``Technical Committee'')--to administer the Agreement and 
creates a mechanism for resolving disputes between parties to 
the Agreement. The rules under the WTO Dispute Settlement 
Understanding apply to disputes over the interpretation or 
application of the Agreement.
    The Committee, which is composed of representatives from 
each of the parties, meets annually in Geneva ``to consult on 
matters relating to the administration of the customs valuation 
system by any party to Agreement as it might affect the 
operation of this Agreement or the furtherance of its 
objectives, and to carry out such other responsibilities as may 
be assigned to it by the parties.'' The WTO secretariat acts as 
the secretariat to the Committee, and the Office of the U.S. 
Trade Representative is the U.S. representative to this 
Committee.
    The Technical Committee was created under the auspices of 
the Customs Cooperation Council (CCC) to carry out the 
responsibilities assigned to it by the parties and set forth in 
annex II to the Agreement with a view towards achieving 
uniformity in interpretation and application of the Agreement 
at the technical level. Among the responsibilities assigned to 
the Technical Committee are--
          (1) to examine specific technical problems arising in 
        the administration of the customs valuation systems and 
        to give advisory opinions offering solutions to such 
        problems;
          (2) to study, as requested, and prepare reports on 
        valuation laws, procedures and practices as they relate 
        to the Agreement; and
          (3) to furnish such information and advice on customs 
        valuation matters as may be requested by parties to the 
        Agreement.
    The Technical Committee meets periodically in Brussels, and 
the U.S. Customs Service serves as the U.S. representative to 
this technical committee.
    Dispute resolution.--Several steps are provided for a party 
to follow if it considers that any benefit accruing to it under 
the Agreement is being nullified or impaired, or if any 
objectives of the Agreement are being impeded by the actions of 
another party.
    First, the aggrieved party should request consultations 
with the party in question with a view to reaching a mutually 
satisfactory solution. If no mutually satisfactory solution is 
reached between the parties within a reasonably short period of 
time, the Committee shall meet at the request of either party 
(within 30 days of receiving such request) and attempt to 
facilitate a mutually satisfactory solution. If the dispute is 
of a technical nature, the Technical Committee will be asked to 
examine the matter and report to the Committee within 3 months.
    In the absence of a mutually agreeable solution from the 
Committee up to this point, the Committee shall, upon the 
request of either party, establish a panel (within 3 months 
from the date of the parties' request for the Committee to 
investigate where the matter is not referred to the Technical 
Committee, otherwise within 1 month from the date of the 
Technical Committee's report) to examine the matter and make 
such finding as will assist the Committee in making 
recommendations or giving a ruling on the matter.
    After the investigation is complete, the Committee shall 
take appropriate action (in the form of recommendations or 
rulings). If the Committee considers the circumstances to be 
serious enough, it may authorize one or more parties to suspend 
the application to any other party of obligations under the 
valuation agreement.
    Special and different treatment.--Part III of the Agreement 
allows developing countries which are party to the Agreement--
          (1) to delay application of its provisions for a 
        period of 5 years from the date the Agreement enters 
        into force;
          (2) to delay application of articles 1, 2(b)(iii) and 
        6 (both of which provide for a determination of the 
        computed value of imported goods) for a period of 3 
        years; and
          (3) to receive technical assistance (such as training 
        of personnel, assistance in preparing implementation 
        measures and advice on the application of the 
        Agreement's provisions) upon request, from developed 
        countries party to the Agreement.

                            Current Law \65\

    Section 402 of the Tariff Act of 1930 \66\ as amended by 
the Trade Agreements Act of 1979 establishes ``Transaction 
Value'' as the primary basis for determining the value of 
imported merchandise. Generally, transaction value is the price 
actually paid or payable for the goods, with additions for 
certain items not included in that price.
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    \65\ Most of the description of current law was taken from 
``Customs Valuation Under the Trade Agreements Act of 1979,'' 
Department of the Treasury, U.S. Customs Service, Office of Commercial 
Operations, October 1981.
    \66\ 19 U.S.C. 1401a.
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    If the first valuation basis cannot be used, the secondary 
bases are considered. These secondary bases, in the order of 
precedence for use, are: transaction value of identical or 
similar merchandise; deductive value; computed value. The order 
of precedence of the last two bases can be reversed if the 
importer so requests. Each of these bases is discussed in 
detail below:
    Transaction value of imported merchandise.--Several 
concepts relating to the transaction value of imported 
merchandise are also applicable to the transaction value of 
identical or similar merchandise, as discussed in the next 
section. These concepts, concerning the nature of transaction 
value itself, are discussed in terms of the transaction value 
of imported merchandise.

                              DEFINITIONS

    The transaction value of imported merchandise (i.e., the 
merchandise undergoing appraisement) is defined as the price 
actually paid or payable for the merchandise when sold for 
exportation to the United States, plus amounts equal to:
          (1) the packing costs incurred by the buyer;
          (2) any selling commission incurred by the buyers;
          (3) the value of any assist; \67\
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    \67\ An ``assist'' is any of the following items that the buyer of 
imported merchandise provides directly or indirectly, and free of 
charge or at reduced cost, for use in the production of or the sale for 
export to the United States of the imported merchandise:
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          Materials, components, parts, and similar items incorporated 
        in the imported merchandise;
          Tools, dies, molds, and similar items used in producing the 
        imported merchandise;
          Merchandise consumed in producing the imported merchandise;
          Engineering, development, artwork, design work, and plans and 
        sketches that are undertaken outside the United States.
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    The last item listed above (``Engineering, development . . .'') 
will not be treated as an assist if the service or work is (1) 
performed by a person domiciled within the United States, (2) performed 
while that person is acting as an employee or agent of the buyer of the 
imported merchandise, and (3) incident to other engineering, 
development, artwork, design work, or plans or sketches undertaken 
within the United States.
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          (4) any royalty or license fee that the buyer is 
        required to pay as a condition of the sale; and
          (5) the proceeds, accruing to the seller, of any 
        subsequent resale, disposal, or use of the imported 
        merchandise.
    These amounts (1 through 5) are added only to the extent 
that each is not included in the price, and is based on 
information establishing the accuracy of the amount. If 
sufficient information is not available, then the transaction 
value cannot be determined; and the next basis of value, in 
order of precedence, must be considered for appraisement.
    The price actually paid (or payable) for the imported 
merchandise is the total payment, excluding international 
freight, insurance, and other C.I.F. charges, that the buyer 
makes to the seller.
    Amounts to be disregarded in determining transaction value 
are:
          (1) The cost, charges, or expenses incurred for 
        transportation, insurance, and related services 
        incident to the international shipment of the goods 
        from the country of exportation to the place of 
        importation in the United States.
          (2) Any decrease in the price actually paid or 
        payable that is made or effected between the buyer and 
        seller after the date of importation of the goods into 
        the United States.
    As well as, if identified separately:
          (3) Any reasonable cost or charge incurred for 
        constructing, erecting, assembling, maintaining, or 
        providing technical assistance with respect to the 
        goods importation into the United States; or 
        transporting the goods after importation.
          (4) The customs duties and other federal taxes, 
        including any federal excise tax for which sellers in 
        the United States are ordinarily liable.

         LIMITATIONS ON THE APPLICABILITY OF TRANSACTION VALUE

    The transaction value of imported merchandise is the 
appraised value of that merchandise, provided certain 
limitations do not exist. If any of these limitations are 
present, then transaction value cannot be used as the appraised 
value, and the next basis of value will be considered. The 
limitations can be divided into four groups:
    (1) Restrictions on the disposition or use of 
merchandise.--The first category of limitations which preclude 
the use of transaction value is the imposition of restrictions 
by a seller on a buyer's disposition or use of the imported 
merchandise. Exceptions are made to this rule. Thus, certain 
restrictions are acceptable, and their presence will still 
allow the use of transaction value. The acceptable restrictions 
are: (a) those imposed or required by law, (b) those limiting 
the geographical area in which the goods may be resold, and (c) 
those not substantially affecting the value of the goods. An 
example of the last restriction occurs when a seller stipulates 
that a buyer of new-model cars cannot sell or exhibit the cars 
until the start of the new sales year.
    (2) Conditions for which a value cannot be determined.--If 
the sale of, or the price actually paid or payable for, the 
imported merchandise is subject to any condition or 
consideration for which a value cannot be determined, then 
transaction value cannot be used. Some examples of this group 
include when the price of the imported merchandise depends on 
(a) the buyer's also buying from the seller other merchandise 
in specified quantities, (b) the price at which the buyer sells 
other goods to the seller, or (c) a form of payment extraneous 
to the imported merchandise, such as, the seller's receiving a 
specified quantity of the finished product that results after 
the buyer further processes the imported goods.
    (3) Proceeds accruing to the seller.--If part of the 
proceeds of any subsequent resale, disposal, or use of the 
imported merchandise by the buyer accrues directly or 
indirectly to the seller, then transaction value cannot be 
used. There is an exception. If an appropriate adjustment can 
be made for the partial proceeds the seller receives, then 
transaction value can still be considered. Whether an 
adjustment is made depends on whether the price actually paid 
or payable includes such proceeds and, if it does not, the 
availability of sufficient information to determine the amount 
of such proceeds.
    (4) Related-party transactions where the transaction value 
is unacceptable.--Finally, the relationship between the buyer 
and seller may preclude the application of transaction value. 
The fact that the buyer and seller are related \68\ does not 
automatically negate using their transaction value; however, 
the transaction value must be acceptable under prescribed 
procedures. To be acceptable for transaction value, 
relationship between the buyer and seller must not have 
influenced the price actually paid or payable. Alternatively, 
the transaction value may be acceptable if the imported 
merchandise closely approximates any one of the following test 
values, provided these values relate to merchandise exported to 
the United States at or about the same time as the imported 
merchandise:
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    \68\ For appraisement purposes, any of the following persons are 
considered related--
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          Members of the same family, including brothers and sisters 
        (whether by whole or half blood), spouse, ancestors, and lineal 
        descendants;
          Any officer or director of an organization and such 
        organization;
          An officer or director of an organization and an officer or 
        director of another organization, if each such individual is 
        also an officer or director in the other organization;
          Partners;
          Employer and employee;
          Any person directly or indirectly owning, controlling, or 
        holding with power to vote, 5 percent or more of the 
        outstanding voting stock or shares of any organization and such 
        organization;
          Two or more persons directly or indirectly controlling, 
        controlled by, or under common control with, any person.
          (A) The transaction value of identical merchandise, 
        or of similar merchandise, in sales to unrelated buyers 
        in the United States,
          (B) The deductive value or computed value for 
        identical merchandise or similar merchandise, or
          (C) The transaction value of imported merchandise in 
        sales to unrelated buyers of merchandise, for 
        exportation to the United States, that is identical to 
        the imported merchandise under apprisement, except for 
        having been produced in a different country. No two 
        sales to unrelated buyers can be used for comparison 
        unless the sellers are unrelated.
    The test values are used for comparison only. They do not 
form a substitute basis of valuation.
    In determining whether the transaction value is close to 
one of the foregoing test values (A, B, or C), an adjustment is 
made if the sales involved differ in commercial levels, 
quantity levels; the costs, commissions, values, fees, and 
proceeds described in (1) through (5) of the ``definition'' of 
value; and the costs incurred by the seller in sales in which 
he and the buyer are not related that are not incurred by the 
seller in sales in which he and the buyer are related.
    As stated, the test values are alternatives to the 
relationship criterion. If one of the test values is met, it is 
not necessary to examine the question of whether the 
relationship influenced the price.
    Transaction value of identical merchandise or similar 
merchandise.--If the transaction value of imported merchandise 
cannot be determined, then the customs value of the imported 
goods being appraised is the transaction value of identical 
merchandise. If merchandise identical to the imported goods 
cannot be found or an acceptable transaction value for such 
merchandise does not exist, then the customs value is the 
transaction value of similar merchandise.
    The same additions, exclusions, and limitations, previously 
discussed in determining the transaction value of imported 
merchandise, also apply in determining the transaction value of 
identical or similar merchandise.
    Besides the data common to all three transaction values, 
certain factors specifically apply to the transaction value of 
identical merchandise or similar merchandise. These factors 
concern the exportation date, the level and quantity of sales, 
the meaning, and the order of precedence of identical 
merchandise and of similar merchandise.
    (a) Exportation date.--The identical merchandise, or 
similar merchandise, for which a transaction value is being 
determined must have been sold for export to the United States 
and exported at or about the same time as the merchandise being 
appraised.
    (b) Sales level/quantity.--The transaction value of 
identical merchandise (or similar merchandise) must be based on 
sales of identical merchandise (or similar merchandise) at the 
same commercial level and, in substantially the same quantity, 
as the sales of the merchandise being appraised. If no such 
sale exists, then sales at either a different commercial level 
or in different quantities, or both, can be used, but must be 
adjusted to take account of any such difference. Any adjustment 
must be based on sufficient information, that is, information 
establishing the reasonableness and accuracy of the adjustment.
    (c) Definition.--(1) The term ``identical merchandise'' 
means merchandise that is: identical in all respects to the 
merchandise being appraised; produced in the same country as 
the merchandise being appraised; and produced by the same 
person as the merchandise being appraised.
    If merchandise meeting all three criteria cannot be found, 
then identical merchandise is merchandise satisfying the first 
two criteria but produced by a different person than the 
merchandise being appraised. Merchandise can be identical to 
the merchandise being appraised and still show minor 
differences in appearance. However, identical merchandise does 
not include merchandise that incorporates or reflects 
engineering, development, artwork, design work, and plans and 
sketches provided free or at reduced cost by the buyer and 
undertaken in the United States.
    (2) The term ``similar merchandise'' means merchandise that 
is produced in the same country and by the same person as the 
merchandise being appraised; like the merchandise being 
appraised in characteristics and component materials; and 
commercially interchangeable with the merchandise being 
appraised.
    If merchandise meeting the foregoing criteria cannot be 
found, then similar merchandise is merchandise having the same 
country of production, like characteristics and component 
materials, and commercial interchangeability but produced by a 
different person.
    In determining whether goods are similar, some of the 
factors to be considered are the quality of the goods, their 
reputation, and the existence of a trademark. It is noted, 
however, that similar merchandise does not include merchandise 
that incorporates or reflects engineering, development, 
artwork, design work, and plans and sketches provided free or 
at reduced cost by the buyer and undertaken in the United 
States.
    (d) Order of precedence.--Sometimes more than one 
transaction value will be present, that is, for identical 
merchandise produced by the same person, for identical 
merchandise produced by another person, for similar merchandise 
produced by the same person, and for similar merchandise 
produced by another person. If this occurs, one value must take 
precedence.
    As stated previously, accepted sales at the same level and 
quantity take precedence over sales at different levels and/or 
quantities. The order of precedence can be summarized as:
          (1) Identical merchandise produced by the same 
        person;
          (2) Identical merchandise produced by another person;
          (3) Similar merchandise produced by the same person; 
        and
          (4) Similar merchandise produced by another person.
    It is possible that two or more transaction values for 
identical merchandise (or similar merchandise) will be 
determined. In such a case, the lowest value will be used as 
the appraised value of the imported merchandise.
    Deductive value.--If the transaction value of imported 
merchandise, of identical merchandise, or of similar 
merchandise cannot be determined, then deductive value is 
calculated for the merchandise being appraised. Deductive value 
is the next basis of appraisement to be used, unless the 
importer designated, at entry summary, computed value as the 
preferred method of appraisement. If computed value was chosen 
and subsequently determined not to exist for customs valuation 
purposes, then the basis of appraisement reverts back to 
deductive value.
    If an assist is involved in a sale, that sale cannot be 
used in determining deductive value. So any sale to a person 
who supplies an assist for use in connection with the 
production or sale for export of the merchandise concerned is 
disregarded for deductive value.
    Basically deductive value is the resale price in the United 
States after importation of the goods, with deductions for 
certain items. Generally, the deductive value is calculated by 
starting with a unit price and making certain additions to and 
deductions from that price.
    One of three prices constitutes the unit price in deductive 
value. The price used depends on when and in what condition the 
merchandise concerned is sold in the United States. If the 
merchandise is sold in the condition as imported at or about 
the date of importation of the merchandise being appraised, the 
price used is the unit price at which the greatest aggregate 
quantity of the merchandise concerned is sold at or about such 
date.
    If the merchandise concerned is sold in the condition as 
imported but not sold at or about the date of importation of 
the merchandise being appraised, the price used is the unit 
price at which the greatest aggregate quantity of the 
merchandise concerned is sold after the date of importation of 
the merchandise being appraised but before the close of the 
90th day after the date of such importation.
    Finally, if the merchandise concerned is not sold in the 
condition as imported and not sold before the close of the 90th 
day after the date of importation of the merchandise being 
appraised. The price used is the unit price at which the 
greatest aggregate quantity of the merchandise being appraised, 
after further processing, is sold before the 180th day after 
the date of such importation.
    After determining the appropriate price, packing costs for 
the merchandise concerned must be added to the price used for 
deductive value, provided such costs have not otherwise been 
included. These costs are added, regardless of whether the 
importer or the buyer incurs the cost. Packing costs include 
the cost of all containers and coverings of whatever nature; 
and of packing, whether for labor or materials, used in placing 
the merchandise in condition, packed ready for shipment to the 
United States.
    Certain other items are not a part of deductive value and 
must be deducted from the unit price. The items are:
          (1) Commissions or profit and general expenses.--Any 
        commission usually paid or agreed to be paid, or the 
        addition usually made for profit and general expenses, 
        applicable to sales in the United States of imported 
        merchandise that is of the same class or kind as the 
        merchandise concerned; and regardless of the country of 
        exportation.
          (2) Transportation/insurance costs.--The usual and 
        associated costs of transporting and insuring the 
        merchandise concerned from the country of exportation 
        to the place of importation in the United States; and 
        from the place of importation to the place of delivery 
        in the United States, provided these costs are not 
        included as a general expense under the preceding 
        paragraph.
          (3) Customs duties/federal taxes.--The customs duties 
        and other federal taxes payable on the merchandise 
        concerned because of its importation, plus any federal 
        excise tax on, or measured by the value of, such 
        merchandise for which sellers in the United States are 
        ordinarily liable; and
          (4) Value of further processing.--The value added by 
        the processing of the merchandise after importation, 
        provided sufficient information exists concerning the 
        cost of processing. The price determined for deductive 
        value is reduced by the value of further processing, 
        only if the third unit price is used as deductive value 
        (i.e., the merchandise concerned is not sold in the 
        condition as imported and not sold before the close of 
        the 90th day after the date of importation, but is sold 
        before the 180th day after the date of importation).
    Computed value.--The last basis of appraisement is computed 
value. If customs valuation cannot be based on any of the 
values previously discussed, then computed value is considered. 
This value is also the one the importer can select at entry 
summary to precede deductive value as a basis of appraisement.
    Computed value consists of the sum of the following items:
          (1) materials, fabrication, and other processing used 
        in producing the imported merchandise;
          (2) profit and general expenses;
          (3) any assist, if not included in (a) and (b); and
          (4) packing costs.
    The cost or value of the materials, fabrication, and other 
processing of any kind used in producing the imported 
merchandise is based on information provided by or on behalf of 
the producer and on the commercial accounts of the producer, if 
the accounts are consistent with generally accepted accounting 
principles applied in the country of production of the goods.
    The producer's profit and general expenses are used, 
provided they are consistent with the usual profit and general 
expenses reflected by producers in the country of exportation 
in sales of merchandise of the same class or kind as the 
imported merchandise.
    If the value of an assist used in producing the merchandise 
is not included as part of the producer's materials, 
fabrication, other processing or general expenses, then the 
prorated value of the assist will be included in computed 
value. The value of any engineering, development, artwork, 
design work, and plans and sketches undertaken in the United 
States is included in computed value only to the extent that 
such value has been charged to the producer.
    Finally, the cost of all containers and coverings of 
whatever nature and of packing, whether for labor or material, 
used in placing merchandise in condition, packed ready for 
shipment to the United States is included in computed value.
    As can be seen, computed value relies to a certain extent 
on information that has to be obtained outside the United 
States, that is, from the producer of the merchandise. If a 
foreign producer refuses to or is legally constrained from 
providing the computed value information, or if the importer 
cannot provide such information within a reasonable period of 
time, then computed value cannot be determined.
    Other.--If none of the previous five values can be used to 
appraise the imported merchandise, then the customs value must 
be based on a value derived from one of the five previous 
methods, reasonably adjusted as necessary. The value so 
determined should be based, to the greatest extent possible, on 
previously determined values. Only data available in the United 
States will be used.

                           Customs User Fees
Background

    Prior to the 99th Congress, the U.S. Customs Service did 
not have the legal authority to collect fees for processing 
commercial merchandise, conveyances, and passengers entering 
the United States. Only limited authority existed to charge 
fees for services which were of special benefit to a particular 
individual such as preclearance of passengers and private 
aircraft. Special fees were also authorized on operators of 
bonded warehouses, foreign trade zones, and the entry of 
vessels into ports. Also, Customs was authorized to receive 
reimbursement from carriers for overtime for services provided 
during non-business hours and from local authorities for 
services provided to certain small airports.
    Section 13031 of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (COBRA) \69\ established a schedule 
of flat-rate fees for processing conveyances and passengers 
entering the United States. The Act imposed fees for Customs' 
costs on a per arrival basis on commercial vessels, trucks, 
railroad cars, private aircraft and boats, and passengers 
arriving on commercial vessels or aircraft from countries other 
than Mexico, Canada, U.S. insular possessions, and other 
adjacent islands. The statute also imposed fees on the 
processing of dutiable mail entries prepared by a customs 
officer, and the issuance of customs broker permits.
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    \69\ Public Law 99-272, approved April 7, 1986.
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    Modifications to these fees, in the Tax Reform Act of 
1986,\70\ included the placement of an annual cap on the 
arrival of commercial vessels, the establishment of a lower 
vessel fee for certain barges and bulk carriers, and an 
increase in the fee for rail cars carrying passengers or 
freight from $5 to $7.50, coupled with the elimination of the 
fee on empty railroad cars.
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    \70\ Public Law 99-514, approved October 22, 1986.
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    The Omnibus Budget Reconciliation Act of 1986 (OBRA) \71\ 
expanded customs user fee authority to cover Customs' costs of 
processing commercial merchandise entries--the so-called 
Merchandise Processing Fee (MPF). The Act imposed an ad valorem 
fee based on the customs value of all formal entries of 
merchandise imported for consumption, including warehouse 
withdrawals for consumption.
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    \71\ Public Law 99-509, approved October 21, 1986.
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    As amended by the Omnibus Budget Reconciliation Act of 1987 
\72\ and the Technical and Miscellaneous Revenue Act of 
1988,\73\ the U.S. portion of the value of articles 
classifiable under items 9802.00.60 and 9802.00.80 of the 
Harmonized Tariff Schedule of the United States (HTS) or to 
products of the least developed developing countries (LDDC's), 
products of eligible countries under the Caribbean Basin 
Initiative (CBI), and products of U.S. insular possessions were 
exempted from the MPF. Further, pursuant to section 203 of the 
United States-Canada Free-Trade Agreement Implementation Act of 
1988,\74\ the merchandise user fees were set to be phased out 
with respect to articles of Canadian origin in accordance with 
article 403 of the bilateral agreement.
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    \72\ Public Law 100-203, section 9501, December 22, 1987.
    \73\ Public Law 100-647, section 9001, November 10, 1988.
    \74\ Public Law 100-449, approved September 28, 1988.
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    Receipts from user fees are deposited in a dedicated 
``Customs User Fee Account'' within the general fund of the 
Treasury, with one subaccount of the receipts from the 
merchandise processing fee and a second subaccount of the 
receipts from the conveyance and passenger fees. Subject to 
authorization and appropriations, all funds in the Account are 
available to pay costs incurred by the Customs Service in 
conducting commercial operations and are treated as receipts 
offsetting expenditures of salaries and expenses for these 
purposes, except for that portion of the fees required for the 
direct reimbursement of appropriations for costs incurred by 
the Customs Service in providing inspectional overtime and 
preclearance services. Inspectional overtime and preclearance 
services are reimbursed subject to a permanent indefinite 
appropriation, and are not subject to OMB apportionment.
    For fiscal year 1990, the merchandise processing fee was 
set at 0.17 percent ad valorem. The legislative authority to 
impose customs user fees was set to expire on September 30, 
1990.
    In February 1988 the General Agreement on Tariffs and Trade 
(GATT) Council adopted a panel finding that the ad valorem 
structure of the merchandise processing fee is inconsistent 
with U.S. GATT obligations to the extent the fee exceeds the 
approximate cost of customs processing for the individual 
entry, and includes costs for Customs Service activities that 
are not services to the particular importer (e.g., costs of 
processing imports exempt from the fee).

Revised fee structure

    The Customs and Trade Act of 1990,\75\ as amended by the 
Omnibus Budget Reconciliation Act of 1990,\76\ completely 
revised and reauthorized customs user fees through fiscal year 
1995. The new fee structure was intended to bring the United 
States into conformity with U.S. obligations under the GATT. 
The conference report
(H. Rept. 101-650) sets forth the underlying rationale and 
congressional intent behind the user fee revision:
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    \75\ Public Law 101-382, title I, subtitle C, approved August 20, 
1990.
    \76\ Public Law 101-508, section 10001, approved November 5, 1990.

          The new fee schedule is structured to respond to this 
        ruling and to bring the United States into conformity 
        with its GATT obligations. As required by the relevant 
        provisions of articles II and VIII of the GATT, the new 
        fee schedule limits the fees charged to the approximate 
        cost of the services rendered. It also limits the fee 
        to customs operations related to merchandise processing 
        and to the processing of imports covered by the fee. 
        Fee revenues also are established so as to approximate 
        the cost of the commercial customs services. As a 
        result, the new fee schedule represents the type of fee 
        permitted under GATT article VIII. It does not 
        represent an indirect protection to domestic products 
        nor does it represent a taxation of imports for 
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        domestic purposes.

    The MPF for the first time differentiated between entries 
or releases of merchandise that are entered formally and those 
that are entered informally. Section 111 of the Customs and 
Trade Act of 1990 authorized a capped ad valorem fee for each 
formal entry and a three-tiered flat rate fee for each entry of 
merchandise entered informally. The amount of the user fee 
would depend upon whether the fee is filed manually or 
electronically. A special reimbursement rule for air courier 
facilities and other reimbursable facilities was also 
established.
    For formal entries, a fee of 0.17 percent ad valorem was 
applied, subject to a maximum of $400 and a minimum of $21, 
except that an additional $3 was assessed on each entry if 
filed manually.
    For informal entries (under $1,250), the following flat 
rate fee schedule was applied:
          $2--for automated, non-customs-prepared informal 
        entries;
          $5--for manual, non-customs-prepared informal 
        entries;
          $8--for customs-prepared informal entries.
    In lieu of the above, air courier facilities and other 
reimbursable facilities were subject to a reimbursement for 
Customs' processing costs to be collected at a rate of twice 
the assessment currently applied at courier hubs. Also, the 
industry's current 80 percent offset was eliminated.
    The Commissioner of Customs was authorized to use any 
surplus from the schedule of flat-rate fees (the ``COBRA 
fees'') to hire full- and part-time personnel, buy equipment, 
or satisfy other direct expenses necessary to provide services 
directly to the payers of the fee, subject to OMB apportionment 
authority. A $30 million reserve of the surplus was required to 
maintain staffing levels equal to those existing in the prior 
year in the event customs collections were reduced. Other 
provisions included new user fee enforcement authority, 
treatment of railroad cars, and agriculture products processed 
and packed in foreign trade zones.
    The 1990 Budget Reconciliation Act extended customs user 
fee authority through September 30, 1995. In addition, the 
Secretary of the Treasury was provided new authority to adjust 
the 0.17 percent ad valorem merchandise processing fee due to 
changes in trade flows and other conditions, subject to a 
maximum adjustment of 0.02 percent, plus or minus. The 
provision also specified publication, consultation, and 
legislative layover periods before an adjustment can be 
effective.
    The 1990 Budget Reconciliation Act also permitted small 
user fee airports processing fewer than 25,000 informal entries 
annually to collect the entry-by-entry fee, rather than paying 
the new double reimbursement fee.
    The 1993 Omnibus Budget Reconciliation Act extended customs 
user fee authority until September 30, 1998. Section 13813 of 
the Act also changed provisions of the COBRA fee statute as 
part of a major reform of the customs inspector pay system (the 
Customs Overtime Pay Reform Act) to authorize the use of COBRA 
funds for a portion of customs officer premium pay and for 
customs retirement-fund contributions related to customs 
officer overtime pay. In addition, the COBRA account was made 
subject to OMB budget apportionment authority.
    The North American Free Trade Agreement Implementation Act 
implemented U.S. obligations under the NAFTA to eliminate the 
Merchandise Processing Fee immediately for Canadian goods 
(consistent with U.S. obligations under the U.S.-Canada FTA), 
and by June 30, 1999 for imports of Mexican goods. The fee may 
not be increased with respect to Mexican goods after December 
31, 1993.
    The NAFTA Implementation Act provided for a temporary 
increase in the $5 COBRA passenger fee to $6.50 through 
September 30, 1997, when it would revert to $5. It also lifted 
the current fee exemptions for passengers arriving from Mexico, 
Canada, and the Caribbean for the same time period. These 
additional fee receipts were dedicated, subject to 
appropriation, to cover Customs' inspectional costs not covered 
by existing customs user fees. The Act also extended all 
customs user fees through September 30, 2003.
    The Uruguay Round Agreements Act provided for an increase 
in the Merchandise Processing Fee rate for formal entries to 
0.21 percent ad valorem, and increased the maximum and minimum 
fee amounts for formal entries from $400 to $485 and from $21 
to $25, respectively. It also increased the rates from $5 to $6 
for informal electronic entries and $8 to $9 for informal paper 
entries. The revised fee was designed to cover a revenue 
shortfall below Customs' commercial costs, as well as increases 
in Customs' operating expenses. The Uruguay Round Agreements 
Act also corrected a technical error in the Customs Overtime 
Pay Reform Act (COPRA) to provide for reimbursement of customs 
inspector premium pay to the extent it was greater than Federal 
Employee Pay Act (FEPA) premium pay authorized to be paid to 
customs inspectors prior to enactment of COPRA.
    The Miscellaneous Trade and Technical Corrections Act of 
1996 (Public Law 104-295) made three amendments with regard to 
customs user fees and merchandise processing fees. First, the 
Act amended section 13031(b) of the COBRA to clarify that the 
ad valorem MPF in foreign trade zones is to be assessed only on 
the foreign value of merchandise entered from a foreign trade 
zone. In addition, the amendment clarified that the application 
of the MPF to processed agricultural products will apply to all 
entries from foreign trade zones after November 30, 1986, for 
which liquidation has not been finalized. The provision was 
necessary to clarify that the MPF applicable solely to foreign 
merchandise entered from a foreign trade zone, exempting 
domestic value, for agricultural products, also would apply to 
non-agricultural products.
    Second, the Act amended section 13031(b) of the COBRA with 
regard to limitations on the collection of customs passenger 
processing fees. As indicated above, the NAFTA Implementation 
Act increased the COBRA passenger processing fee from $5 to 
$6.50 and temporarily lifted the exemption on passengers 
arriving from Canada, Mexico, and the Caribbean during the 
period from January 1, 1994 through September 30, 1997. The 
statute was also modified to apply the fee to so-called 
``cruises to nowhere,'' that is, cruises which leave U.S. 
customs territory and return, without calling on any port 
outside the United States. The amendment clarified that Customs 
should collect fees only one time in the course of a single 
continuous voyage for a passenger aboard a commercial vessel 
that calls on more than one U.S. port.
    Third, the Act amended section 13031(b) of the COBRA to 
clarify that Customs may provide reimbursable services to air 
couriers operating in express consignment carrier facilities 
and in centralized hub facilities during daytime hours. The 
amendment also clarified that Customs may be reimbursed for all 
services related to the determination to release cargo, and not 
just ``inspectional'' services. These services are now 
reimbursable whether they are performed on site or not.

Current law

    Customs' authority to collect user fees under the 
Consolidated Omnibus Budget Reconciliation Act of 1985 (19 
U.S.C. 58c) for passengers arriving into the United States 
aboard a commercial vessel or aircraft from Canada, Mexico, a 
U.S. territory or possession or the Caribbean expired on 
September 30, 1997. As a result, Customs considered that its 
authority to use the COBRA user fee account for preclearance 
services for such passengers had also expired. Customs 
continued to fund those positions out of its regular budget in 
order to keep those services. However, due to budgetary 
constraints, Customs was unable to fund all of the positions, 
resulting in decreased preclearance services.
    To address this issue, the Miscellaneous Trade and 
Technical Corrections Act of 1999 (Public Law 106-36) (the Act) 
made two amendments to Customs user fees under 13031 of the 
Consolidated Omnibus Budget Reconciliation Act of 1985 (19 
U.S.C. 58c). First, the Act amended section 58c(f)(3)(A)(iii) 
to permit Customs access to the COBRA user fee account to pay 
for the salaries for up to 50 full-time equivalent inspectional 
positions to provide preclearance services. These services 
would be provided only to the extent that funds remain 
available after reimbursements for salaries for full-time and 
part-time inspectional personnel and equipment that enhance 
Customs' services for those persons or entities required to pay 
fees under this section.
    Second, the Act amended section 58c(a) by establishing (i) 
a $5 fee for passengers arriving in the United States aboard a 
commercial vessel or aircraft other than from Canada, Mexico, 
U.S. territory or possession, or the Caribbean, and (ii) a 
$1.75 fee for passengers arriving aboard a commercial vessel 
from Canada, Mexico, U.S. territory or possession, or the 
Caribbean.
    The Act also amended section 58c(f) to authorize Customs 
access to $50 million of the merchandise processing fees for 
the Customs Automated Commercial System for FY 1999. In 
addition, the Act mandated the Commissioner of Customs to 
establish an advisory committee consisting of representatives 
from the airline, cruise ships, and other transportation 
industries subject to these fees. Under this provision, the 
representatives would meet periodically and advise the 
Commissioner on issues relating to these services and fees.
    Finally, the Act authorized the Secretary of the Treasury 
to implement a National Customs Reconciliation Test program 
relating to an alternative mid-point interest accounting 
methodology that may be used by an importer. The test period 
was not to exceed October 1, 2000. Section 1451 of the Tariff 
Suspension and Trade Act of 2000 (Public Law 106-476) made this 
authorization permanent.
    The Tariff Suspension and Trade Act of 2000 also amended 
section 13031(b)(1)(A)(iii) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (19 U.S.C. 58c(b)(1)(A)(iii)) to 
allow Customs to collect user fees from passengers arriving 
aboard a ferry operating south of 27 degrees latitude and east 
of 89 degrees longitude, whose operations began on or after 
August 1, 1999. Prior to enactment of this legislation, because 
of the limitations on user fees under the COBRA, Customs was 
prevented from collecting user fees from such ferries, and as a 
result, did not issue landing rights to such ferries.

                           Other Customs Laws

                       Country-of-Origin Marking

    Section 304 of the Tariff Act of 1930, as amended,\77\ 
provides that, with certain exceptions, every imported article 
of foreign origin (or its container in specified circumstances) 
``shall be marked in a conspicuous place as legibly, indelibly, 
and permanently as the nature of the article (or container) 
will permit in such manner as to indicate to an ultimate 
purchaser in the United States the English name of the country 
of origin of the article.'' The purpose of this provision is to 
provide information so that the ``ultimate purchaser'' in the 
United States can choose between domestic and foreign-made 
products, or between the products of different foreign 
countries.
---------------------------------------------------------------------------
    \77\ 19 U.S.C. 1304.
---------------------------------------------------------------------------
    When imported articles ordinarily reach their ultimate 
purchasers in packaged form, the containers or holders must, as 
a general rule, be marked with the country of origin of their 
contents, whether or not the article themselves are required to 
be marked.
    Exceptions.--The statute gives the Secretary of the 
Treasury the authority to allow exceptions to the marking 
requirement under prescribed circumstances. For example, 
certain classes of merchandise are excepted from the country-
of-origin marking requirements because they are not physically 
susceptible to marking or can only be marked at the cost of 
injury to the article.
    Marking requirements may also be waived as to articles 
which arrive at the U.S. border unmarked, provided: the expense 
of marking under Customs supervision would be economically 
prohibitive; and the Customs Service is satisfied that the 
importer or shipper did not fail to mark the merchandise before 
shipment to the United States for the purpose of invoking this 
exception and thereby avoiding the marking requirements.
    Another exception to the marking requirement may be granted 
for articles for which the ultimate purchaser necessarily knows 
the country of origin. An exception is also provided for 
articles to be processed by the importer for resale if the 
processing would necessarily obliterate or conceal any marking. 
If the processing undertaken by the importer is sufficient to 
convert the imported article into a new and different article 
of trade, any subsequent purchaser is not an ``ultimate 
purchaser'' of the imported article.
    Other classes of excepted merchandise include products of 
American fisheries, products of U.S. possessions, products of 
U.S. origin which have been exported and returned, and articles 
entered for immediate transshipment and exportation from the 
United States. In addition, articles qualifying for duty-free 
treatment as being $1 or less in value, or as bona fide gifts 
less than $10 in value each, are relieved of the marking 
requirements, as are articles produced more than 20 years prior 
to importation.
    Finally, under section 1304(a)(3)(J), classes of articles 
named in certain notices published by the Secretary of the 
Treasury in the late 1930's are not subject to the marking 
requirements. The articles named in such notices were those 
which had been imported in substantial quantities during the 5-
year period ending December 31, 1936, and which had not been 
required to bear country-of-origin markings during that period. 
Such excepted articles are now found in the so-called ``J-
List.'' \78\
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    \78\ 19 CFR 134.33.
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    The Miscellaneous Trade and Technical Corrections Act of 
1996 (Public Law 104-295) amended section 304 to exempt from 
the country-of-origin marking requirements certain imported 
coffees, teas, and spices. These items are specifically 
identified by their respective Harmonized Tariff Schedule 
numbers.
    Section 334 of the Uruguay Round Agreements Act (URAA) 
(Public Law 103-165) established the country of origin for 
certain fabrics, silk handkerchiefs and scarves as the country 
where the fabrics are made, even if they undergo dyeing, 
printing, cutting, sewing, and other finishing operations in 
another country (``the Breaux-Cardin rule''). Prior to Breaux-
Cardin, the rules or origin permitted the processes of dyeing 
and printing to confer origin when accompanied by two or more 
finishing operations for certain products. As a result of 
Breaux-Cardin, silk scarves dyed, finished, or printed in Italy 
(or other countries) from imported silk fabric that could 
formerly be marked ``Made in Italy'' were now required to be 
marked with the country of the silk fabric as the country of 
origin.
    The European Union brought a World Trade Organization 
dispute against the United States relating to the Breaux-Cardin 
rule. As part of the U.S. settlement of this dispute, Congress 
added a new subsection (h) to section 304 of the Tariff Act of 
1930 in the Miscellaneous Trade and Technical Corrections Act 
of 1999 (Public Law 106-36). This provision exempted silk 
fabric and scarves from the country of origin marking 
requirement so that these articles were no longer required to 
be marked as having the origin of the country where the fabric 
was produced. This provision did not change the rules for 
determining the country of origin. Thus, under the Act, a silk 
scarf dyed and printed in Italy from silk fabric imported from 
China could not be marked ``Made in Italy'' thus indicating 
origin, but could be marked ``Designed in Italy,'' ``Dyed and 
Printed in Italy,'' ``Crafted in Italy,'' or other similar 
marking.
    In August 1999, the United States and the EU settled the 
dispute, and the United States agreed to amend the rule of 
origin requirements under section 334 of the URAA. As a result, 
Congress included in the Trade and Development Act of 2000 
(Public Law 106-200) legislation which reinstated the rules of 
origin that existed prior to the URAA for certain products. 
Specifically, the legislation allows dyeing, printing, and two 
or more finishing operations to confer origin on certain 
fabrics and goods. In particular, the dyeing and printing rule 
applies to fabrics classified under the Harmonized Tariff 
Schedule (HTS) as silk, cotton, man-made, and vegetable fibers. 
The rule also applies to the various products classified in 18 
specific subheading of the HTS listed in the bill, except for 
goods made from cotton, wool, or fiber blends containing 16 
percent or more of cotton.
    Marking of certain pipe and fittings.--An amendment to 
section 304 of the Tariff Act of 1930 contained in section 207 
of the Trade and Tariff Act of 1984 provided that no exceptions 
may be made to the country-of-origin marking requirement for 
imported pipe, pipe fittings, compressed gas cylinders, manhole 
rings or frames, covers and assemblies thereof, and specifies 
the type of marking which is acceptable for those products.
    Marking of containers of imported mushrooms.--Section 
1907(b) of the Omnibus Trade and Competitiveness Act of 1988 
(OTCA) specifies that markings on imported preserved mushrooms 
must indicate in English the countries in which the mushrooms 
were grown.
    Marking of Native-American style jewelry and arts and 
crafts.--Section 1907(c) of the OTCA provided that the 
Secretary of the Treasury prescribe and implement regulations 
which require that all imported Native-American style jewelry 
and Native-American style arts and crafts have the English name 
of the country of origin indelibly and permanently marked in a 
conspicuous place on such products.
    Penalty for failure to mark.--Imported goods that are not 
properly marked are liable for a 10 percent ad valorem duty in 
addition to any other duty that might be applicable. The 
payment of the 10 percent marking duty does not discharge the 
importer's obligation to comply.\79\
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    \79\ Globemaster, Inc. v. United States, 68 Cust. Ct. C.D. 4340, 
340 F. Supp. 974 (1972).
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    Imported articles or their containers that are found to be 
improperly marked are generally retained in Customs custody 
until such time as the importer, after notification, arranges 
for their exportation, destruction, or proper marking under 
Customs supervision, or until they are deemed abandoned to the 
government. If such unmarked articles are part of a shipment 
the balance of which has previously been released from Customs 
custody, the importer will be notified and ordered to redeliver 
the released articles to Customs for marking, exportation, or 
destruction under Customs supervision.
    Section 304(h) of the Tariff Act (19 U.S.C. 1304) provided 
for a maximum fine of $5,000, or imprisonment of not more than 
1 year upon conviction for any person who ``with intent to 
conceal'' alters or removes the country-of-origin marking. 
Section 1907(a) of the OTCA increased the maximum fine for 
intentional alteration or removal of country-of-origin markings 
to $100,000 on the first offense and $250,000 for subsequent 
offenses.
    Automobile labeling.--The American Automobile Labeling Act, 
enacted as section 210 of the Motor Vehicle Information and 
Cost Savings Act,\80\ requires manufacturers to affix, and 
dealers to maintain, labels on cars and light-duty trucks 
regarding the country of origin of component parts and the 
location of assembly. For each line of cars, the label will 
include the percentage (by value) of component parts which 
originated in the United States or Canada, and the countries 
and percentages from other manufacturers who contribute 15 
percent or more to the component value of the vehicle. The 
combined United States/Canadian percentage, which is based on 
the longstanding special bilateral relationship in automotive 
trade, must be clearly identified, listing clearly both 
countries. No other countries are to be combined with the 
United States and Canadian combined percentage. For each 
individual vehicle, the label will also include the city, state 
(where appropriate), and country where the vehicle was 
assembled; the country of origin of the engine; and the country 
of origin of the transmission. For the purpose of identifying 
the country of assembly and the country of origin of the engine 
and transmission, the United States will be identified 
separately. All vehicles manufactured on or after October 1, 
1994, for sale in the United States must be labeled.
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    \80\ As added by Public Law 102-388, section 355 approved October 
6, 1992.
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    North American Free Trade Agreement.--Sections 207 and 208 
of the North American Free Trade Agreement Implementation Act 
implemented U.S. obligations under NAFTA articles 311, annex 
311, and article 510 regarding country-of-origin marking for 
NAFTA-origin goods, and the review and appeal of customs 
marking decisions. Section 207 amends section 304 of the Tariff 
Act of 1930, as amended, to provide certain limited exemptions 
for the country-of-origin marking requirements for goods of 
NAFTA origin. It exempted goods where the importer ``reasonably 
knows'' that they are NAFTA-origin goods, and specifically 
exempted original works of art, ceramic bricks, semiconductor 
devices, and integrated circuits. Sections 207(a) and 208 
amended sections 304 and 514 of the Tariff Act to provide NAFTA 
exporters and producers with rights to challenge and protest 
adverse NAFTA marking decisions by the Customs Service.

                         NAFTA Rules of Origin

    Originating goods.--Section 202 of the North American Free 
Trade Agreement Implementation Act enacts articles 401 through 
415 of the NAFTA regarding rules of origin. The NAFTA rules 
ensure that NAFTA preferential tariff treatment is granted only 
to the products of the United States, Mexico, and Canada. Goods 
are considered to originate in a NAFTA party if: (1) they are 
wholly obtained or produced in the territory of one or more 
NAFTA parties; (2) each of the non-originating materials used 
in the good undergoes a change in tariff classification as a 
result of production that occurs entirely within one or more of 
the parties; (3) the good is produced entirely in one or more 
of the parties exclusively from NAFTA-origin materials; or (4) 
with certain exceptions, the good is produced entirely in one 
or more of the NAFTA parties but one or more of the non-
originating parts does not undergo a change in tariff 
classification; and the regional value content of the goods 
meets certain thresholds (at least 60 percent of the value of 
the goods or 50 percent of their net cost.)
    Regional value-content.--Section 202(b) of the North 
American Free Trade Agreement Implementation Act sets forth 
methodologies for calculating regional value-content on the 
basis of either ``transaction value'' or ``net cost of the 
good.'' Regional value using the transaction value method is 
computed by taking the difference between the transaction value 
of the good and the value of non-originating materials used in 
the production of the good, divided by the transaction value of 
the good. Regional value using the net-cost method is computed 
by dividing the difference between the net cost of the good and 
the value of non-originating materials used in the production 
of the good by the net cost of the good. A producer of a good 
may use one of three ways to allocate applicable costs when 
using the net-cost method. Under certain circumstances 
delineated in section 202(b), the net-cost method is required 
to be used.
    Automotive goods.--Section 202(c) of the North American 
Free Trade Agreement Implementation Act sets forth the regional 
value-content requirement for motor vehicles. For passenger 
motor vehicles, light trucks, and their engines and 
transmissions, the regional value-content is increased in 
stages from 50 percent for the first 4 years of NAFTA to 56 
percent for the second 4 years and to 62.5 percent thereafter. 
Other motor vehicles and other automotive parts are subject to 
a 50 percent regional content requirement for the first 4 
years, 55 percent for the second 4 years, and 60 percent 
thereafter. A special rule applies to investors who newly 
construct or refit a plant to produce a new vehicle. Section 
202(c) provides that, for passenger vehicles and light trucks 
and their automotive parts, the value of non-originating 
materials must be ``traced'' back through the production 
process for purposes of calculating the regional value-content. 
An auto producer may average its calculation of regional value-
content using a number of different methodologies.
    Certificate of Origin.--Section 205 of the North American 
Free Trade Agreement Implementation Act amends section 508 of 
the Tariff Act to require a NAFTA Certificate of Origin for 
goods for which preferential tariff treatment is claimed, and 
imposes recordkeeping requirements to substantiate the 
Certificates subject to recordkeeping penalties.

                                Drawback

    Under section 313(a) of the Tariff Act of 1930 (19 U.S.C. 
1313(a)), ``drawback'' is payable upon the exportation of an 
article manufactured or produced in the United States with the 
use of duty-paid imported merchandise. To receive benefit of 
drawback, the completed article must have been exported within 
5 years from the date of importation of the pertinent duty-paid 
merchandise. The amount of refund is equal to 99 percent of the 
duties attributable to the foreign, duty-paid content of the 
exported article. The procedural and other requirements 
governing drawbacks are set forth in 19 CFR part 22.
    The purpose of section 313(a) is to permit American-made 
products to compete more effectively in world markets. It 
enables domestic manufacturers and producers to select the most 
advantageous sources for their raw materials and component 
requirements without regard to duties, thereby permitting 
savings in their production costs. It also encourages domestic 
production and, as a result, the utilization of American labor 
and capital.
    An important feature of section 313(a) and a number of 
other drawback provisions is the allowance of drawback on a 
substitution basis. Pursuant to section 313(b), an exported 
article incorporating components entirely of domestic origin 
can nevertheless qualify for drawback, to the extent that duty 
has been paid on the importation of components of the same kind 
and quality as those used in the manufacture or production of 
the exported article.
    Section 202 of the Trade and Tariff Act of 1984 expanded 
the application of current drawback provisions in three 
important respects. First, it allows drawback if the same 
person requesting drawback, subsequent to importation and 
within 3 years of importation of the merchandise, exports from 
the United States or destroys under Customs supervision 
fungible merchandise (whether imported or domestic) which is 
commercially identical to the merchandise imported.
    Second, it allows drawback for all packaging materials 
imported for packaging or repackaging imported merchandise.
    Finally, the Act provides that any domestic merchandise 
acquired in exchange for imported merchandise of the same kind 
and quality shall be treated as the use of such imported 
merchandise for drawback purposes if no certificate of delivery 
is issued for such imported merchandise.
    In addition to section 313(a), there are a variety of other 
specific drawback provisions allowing for the refund of duties 
and/or internal revenue taxes under specified circumstances for 
the exportation of products such as flavoring extracts, 
toiletries, distilled spirits, salts, and cured meats. Further, 
under section 313(c), drawback is allowable when merchandise is 
rejected by the importer because it fails to conform to the 
sample upon which the purchase order was made, or because it 
fails to conform to the importer's specifications, or because 
the merchandise was shipped without the consignee's consent. 
When such rejected merchandise is exported under Customs 
supervision, 99 percent of the duties paid will be refunded 
upon compliance with the pertinent regulations.
    The Customs Modernization Act (section 632 of the North 
American Free Trade Agreement Implementation Act) made a series 
of changes to address questions which have arisen in the 
implementation and administration of the drawback law. Section 
632 made changes including: allowing manufacturing drawback for 
unused articles that are destroyed rather than exported, 
extending the period for drawback claims on rejected 
merchandise to 3 years; with respect to same condition 
drawback, changing the standard for allowing substitution of 
merchandise for the imported merchandise from ``fungible'' to 
``commercially interchangeable''; authorizing the electronic 
filing of drawback claims and setting a period of 3 years from 
the date of exportation or destruction in which to file a 
claim; and simplifying accounting requirements for petroleum. 
Section 622 established penalty provisions for the submission 
of false drawback claims and created a ``Drawback Compliance 
Program.''
    The Miscellaneous Trade and Technical Corrections Act of 
1999 (Public Law 106-36) amended section 313(p) of the Tariff 
Act of 1930 (19 U.S.C. 1313(p)) to expand the scope of 
petroleum products eligible for substitution drawback. The Act 
also amended 313(q) of the Tariff Act of 1930 (19 U.S.C. 
1313(q)) to permit drawback of imported materials used by a 
manufacturer or any other person to manufacture packaging 
materials where the packaging is ``used'' in exportation or is 
destroyed.
    The Tariff Suspension and Trade Act of 2000 (Public Law 
106-476) further amended section 313(p) to broaden the scope of 
petroleum products eligible for substitution drawback. This Act 
also amended section 313 of the Tariff Act of 1930 (19 U.S.C. 
1313) by adding new subsection (x) to permit drawback of 
recycled materials.
    NAFTA drawback.--Section 203 of the North American Free 
Trade Agreement Implementation Act implemented limitations on 
duty drawback included under NAFTA article 303. ``NAFTA 
drawback'' refers to the formula used to compute the amount of 
drawback that will be allowed for dutiable goods traded between 
the NAFTA parties. The formula limits drawback to the lesser 
of: (1) the total amount of customs duties paid or owed on the 
non-NAFTA components initially imported; and (2) the total 
amount of customs duties paid to another party on the goods 
subsequently exported. It generally applies to all goods 
imported into the United States, with certain exceptions. The 
provision applies for exports to Canada on January 1, 1996, and 
for exports to Mexico on January 1, 2001. It has the practical 
effect of essentially eliminating drawback for NAFTA-origin 
goods as NAFTA tariff reductions become effective. While no 
limitations were imposed on same condition drawback, same 
condition substitution drawback was eliminated upon the entry 
into force of the Agreement, with certain exceptions. In no 
case may drawback be paid with respect to countervailing or 
antidumping duties on goods entering the United States. 
Furthermore, section 210 of the Act generally prohibits 
drawback for color television picture tubes.
    Special rule for extending time for filing drawback 
claims.--The Miscellaneous Trade and Technical Corrections Act 
of 1996 (Public Law 104-295) amended section 313(r) of the 
Tariff Act of 1930, as amended, to permit a temporary extension 
of 1 year for filing drawback claims in cases where the 
President has declared a major disaster on or after January 1, 
1994, and the claimant files a request for such extension with 
the Customs Service within 1 year from the date of enactment.

                   Protests and Administrative Review

    Generally, liquidation of an entry represents a final 
determination by Customs regarding an importer's duty liability 
unless a protest is filed, in proper form, within 90 days after 
the date of liquidation. A protest allows the importer to 
secure further administrative review and preserve the right to 
judicial review. Under current law, a protest must be filed in 
the port where the underlying decision was made.
    Sections 514, 515 and 516 of the Tariff Act of 1930,\81\ as 
amended, provide for administrative review of decisions of the 
Customs Service, requirements for filing protests, amendment of 
protests, review and accelerated disposition, and further 
administrative review. These provisions provide a statutory 
means whereby the ``correctness'' of decisions by Customs may 
be administratively reviewed.
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    \81\ 19. U.S.C. 1514, 1515, and 1516.
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    Under section 514, an importer is entitled to protest the 
legality of decisions by Customs relating to:
          (1) the appraised value of merchandise;
          (2) the classification and rate and amount of duties 
        chargeable;
          (3) all charges or exactions of whatever character 
        within the jurisdiction of the Secretary of the 
        Treasury;
          (4) the exclusion of merchandise from entry or 
        delivery or a demand for redelivery to customs custody 
        under any provision of the customs laws, except a 
        determination appealable under section 337;
          (5) the liquidation or reliquidation of an entry, or 
        reconciliation as to the issues contained therein, or 
        any modification thereof;
          (6) the refusal to pay a claim for drawback; or
          (7) the refusal to reliquidate an entry under 
        subsection (c) or (d) of section 520 (19 U.S.C. 1520).
    In addition, section 514 provides the requirements for the 
form, number and amendments of protest, and limitations on 
protest or reliquidation.
    Section 515 provides Customs a two-year period to respond 
to a protest unless there is a request for accelerated 
disposition. In a case of a request for accelerated 
disposition, Customs is required to respond within 30 days. 
This section also provides that the protest may be subject to 
further review of the protest by another Customs officer 
(usually Customs Headquarters), upon a timely request. The 
Miscellaneous Trade and Technical Corrections Act of 1999 
(Public Law 106-36) amended this section to require the 
appropriate Customs officer to issue a decision on an 
application for further review within 30 days of the 
application, and if allowed, to forward the protest to the 
Customs Officer who will be conducting the review.
    If a protesting party believes that the application for 
further review was erroneously or improperly denied, such a 
party may file a request to the Commissioner of Customs, within 
60 days after the notice of denial, that the denial be set 
aside. If the Commissioner fails to act within the 60 days, the 
request is deemed denied.
    Section 516 is a unique Customs provision that entitles 
American manufactures, producers, wholesalers, labor unions, 
groups of workers, or trade or business associations the 
statutory right to challenge Customs treatment of an imported 
product of the same class or kind as the product they produce 
or sell. Under this section, an interested domestic party may 
file a petition with the Commissioner of Customs alleging that 
appraised value, classification, or rate of duty is not 
correct. Other interested party may submit comments.
    If Customs agrees with the petition, in whole or in part, 
it will publish a notice of its decision and will appraise, 
classify, or assess duty on merchandise entered after a thirty-
day period in accordance with that decision. If Customs reaches 
a negative decision on the petitioner's claims, it will notify 
the petitioner. The petitioner may file a notice with Customs 
within thirty days that he will contest the negative decision 
in court.
    Once the appropriate administrative procedures in Sections 
514, 515, and 516 have been completed, the importer or domestic 
party may have redress to the Court of International Trade 
based on other statutory provisions.

                  Copyrights and Trademark Enforcement

    Copyrights.--Section 602(a) of the Copyright Revision Act 
of 1976 \82\ provides that the importation into the United 
States of copies of a work acquired outside the United States 
without authorization of the copyright owner is an infringement 
of the copyright and are subject to seizure and forfeiture. 
Forfeited articles are generally destroyed; however, the 
articles may be returned to the country of export whenever 
Customs is satisfied that there was no intentional violation. 
Copyright owners seeking import protection from the U.S. 
Customs Service must register their claim to copyright with the 
U.S. Copyright Office and record their registration with 
Customs in accordance with applicable regulations.\83\
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    \82\ Public Law 94-553, section 101, approved October 19, 1976, 17 
U.S.C. 602(a).
    \83\ 19 CFR 133, subpart D.
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    Trademarks and trade names.--Articles bearing counterfeit 
trademarks, or marks which copy or simulate a registered 
trademark registration of a U.S. or foreign corporation are 
prohibited importation, provided a copy of the U.S. trademark 
registration is filed with the Commissioner of Customs and 
recorded in the manner provided by regulations.\84\ The U.S. 
Customs Service also affords similar protection against 
unauthorized shipments bearing trade names which are recorded 
with Customs pursuant to regulations.\85\ It is also unlawful 
to import articles bearing genuine trademarks owned by a U.S. 
citizen or corporation without permission of the U.S. trademark 
owner, if the foreign and domestic trademark owners are not 
parent and subsidiary companies or otherwise under common 
ownership and control, provided the trademark has been recorded 
with Customs and the U.S. trademark owner has not authorized 
the distribution of trademarked articles abroad.
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    \84\ 19 CFR 133.1-133.7.
    \85\ 19 CFR part 133, subpart B.
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    The Anticounterfeiting Consumer Protection Act of 1996 
(Public Law 104-153) strengthened the protection afforded 
trademark owners against the importation of articles bearing a 
counterfeit trademark. A ``counterfeit trademark'' is defined 
as a spurious trademark which is identical to, or substantially 
indistinguishable from, a registered trademark. First, the Act 
redefined counterfeiting as a form of racketeering. Second, it 
extended both the copyright and trademark laws, and the seizure 
and forfeiture laws, to computer programs, computer 
documentation, and packaging. Third, the Act amended the law 
such that, upon seizure of counterfeit merchandise, the Customs 
Service must notify the owner of the trademark, and, after 
forfeiture, destroy the merchandise. Alternatively, if the 
merchandise is not unsafe or a hazard to health, and the 
Customs Service has the consent of the trademark owner, the 
forfeited goods may be: (1) given to any federal, state, or 
local government agency which has established a need for the 
article; (2) given to a charitable institution; or (3) sold at 
public auction, if more than 90 days have passed since the date 
of forfeiture, and no eligible organization has established a 
need for the article.
    The Anticounterfeiting Consumer Protection Act of 1996 also 
amended section 431 of the Tariff Act of 1930 to require public 
disclosure of aircraft manifests in addition to vessel 
manifests. Last, the Act amended section 484 of the Tariff Act 
of 1930 to require the Customs Service to prescribe new 
regulations governing the content of entry documentation so as 
to aid in the determination of whether imported merchandise 
bears a counterfeit trademark.

                               Penalties

    Section 592 of the Tariff Act of 1930, as amended,\86\ is 
the basic and most widely used customs penalty provision. It 
prescribes monetary penalties against any person who imports, 
attempts to import, or aids or procures the importation of 
merchandise by means of false or fraudulent documents, 
statements, omissions or practices, concerning any material 
fact. The statute may be applied even though there is no loss 
of revenue involved.
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    \86\ 19 U.S.C. 1592.
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    Section 592 infractions are divided into three categories 
of culpability, each giving rise to a different maximum 
penalty, as follows:
          (1) Fraud.--This category involves an act of 
        commission or omission intentionally done for the 
        purpose of defrauding the United States of revenue, or 
        otherwise violating section 592. The maximum civil 
        penalty for a fraudulent violation is the domestic 
        value of the merchandise in the entry or entries 
        concerned.
          (2) Gross negligence.--This category involves an act 
        of commission or omission with actual knowledge of, or 
        wanton disregard for, the relevant facts and a 
        disregard of section 592 obligations, whereby the 
        United States is or may be deprived of revenue, or 
        where section 592 is otherwise violated. The maximum 
        civil penalty for gross negligence is the lesser of the 
        domestic value of the merchandise or four times the 
        loss of revenue (actual or potential). If the 
        infraction does not affect the revenue, the maximum 
        penalty is 40 percent of the dutiable value of the 
        goods.
          (3) Negligence.--This category involves a failure to 
        exercise due care in ascertaining the material facts or 
        in ascertaining the obligations under section 592. The 
        maximum civil penalty for negligence is the lesser of 
        the domestic value of the merchandise or twice the loss 
        of revenue (actual or potential). However, where there 
        is no loss-of-revenue issue, the penalty cannot exceed 
        20 percent of the dutiable value.
    In addition to the civil penalties described above, a 
criminal fraud statute provides for sanctions to those 
presenting false information to customs officers. Title 18, 
United States Code, section 542, provides a maximum of 2 years 
imprisonment, or a $5,000 fine, or both, for each violation 
involving an importation or attempted importation.
    The Secretary of the Treasury is authorized to seize 
merchandise if there is resasonable cause to believe that a 
person has violated these provisions and the alleged violator 
is insolvent; outside the jurisdiction of the United States; is 
otherwise essential to protect the revenue; or to prevent the 
importation of prohibited merchandise into the United States.
    For proceedings commenced by the United States in the Court 
of International Trade for monetary penalties, all issues shall 
be tried de novo. The statute specifies the standard of proof 
required to establish a violation. In fraud cases, the United 
States has the burden to prove the violation by clear and 
convincing evidence; in gross negligence cases, the government 
has the burden to establish all the elements of the alleged 
violation; and for negligence cases, the government has the 
burden to establish the act or omission and the defendant has 
the burden of proof that the act or omission did not occur as a 
result of negligence.
    The Customs Modernization Act (section 621 of the North 
American Free Trade Agreement Implementation Act) amended 
section 592 to apply existing penalties for false information 
to information transmitted electronically; allow Customs to 
recover unpaid taxes and fees resulting from 592 violations; 
clarify that the mere non-intentional repetition of a clerical 
error does not constitute a pattern of negligent conduct; and 
define the commencement of a formal investigation for the 
purposes of prior disclosure of alleged violations. It also 
introduced the requirement that importers use ``reasonable 
care'' in making entry and providing the initial classification 
and appraisement; establishing a ``shared responsibility'' 
between Customs and importers; and allowing Customs to rely on 
the accuracy of the information submitted and streamline entry 
procedures (section 637 of the North American Free Trade 
Agreement Implementation Act). To the extent that an importer 
fails to use reasonable care, Customs may impose a penalty 
under section 592.
    Section 205 of the North American Free Trade Agreement 
Implementation Act amended section 592 to apply identical 
penalty provisions to importers making false declarations and 
certificates of NAFTA origin.
    The Anticounterfeiting Consumer Protection Act of 1996 
(Public Law 104-153) made several amendments to the Tariff Act 
of 1930, as amended. First, the Act extended the application of 
customs civil penalties to include merchandise bearing a 
counterfeit trademark. Second, the Act amended section 526 of 
the Tariff Act of 1930 to require the consent of the trademark 
owner prior to any action by the Secretary of the Treasury 
regarding the disposition of seized merchandise. Third, the Act 
linked the relevant civil penalties to the value that the 
merchandise would have had if it were genuine, according to the 
manufacturer's suggested retail price, in addition to any other 
civil or criminal penalties. Last, the Act amended section 
431(c)(1) of the Tariff Act of 1930 to require the advanced 
public disclosure of aircraft manifests to assist Customs in 
electronically screening passengers for inspection upon 
arrival.
    Recordkeeping.--The Customs Modernization Act (section 615 
of the North American Free Trade Agreement Implementation Act) 
provided new penalties for the failure to comply with a lawful 
demand for records required for the entry of merchandise, and 
established a ``Recordkeeping Compliance Program.'' For willful 
failure to comply, the penalty is the lesser of up to $100,000, 
or 75 percent of the value of the merchandise, and for 
negligence, the lesser of up to $10,000 or 40 percent of the 
value. The new penalties were authorized with the understanding 
that Customs would routinely waive the production of records at 
entry, while retaining the ability to audit those records at a 
later time.
    Import prohibitions/restrictions relating to dog and cat 
fur products.--The Tariff Suspension and Trade Act of 2000 
(Public Law 106-476) amended title III of the Tariff Act of 
1930 by adding Section 308 (19 U.S.C. 1308) to prohibit all 
commercial activities relating to trading with dog or cat fur 
products. Specifically, this legislation prohibits the 
importation or exportation of products made with dog or cat 
fur, as well as domestic activities including the introduction 
into interstate commerce, manufacture for introduction into 
interstate commerce, sale or offer for sale, trade, 
advertisement, transportation or distribution in interstate 
commerce of products made with dog or cat fur. In addition to 
criminal and civil penalties under existing law, a person 
violating this section may be liable for additional civil 
penalties, forfeiture, and debarment from importing, exporting, 
transporting, distributing, manufacturing, or selling any fur 
products in the United States. A person accused of violating 
this section is entitled to an affirmative defense if he shows 
by a preponderance of the evidence that he has exercised 
reasonable care.
    Section 308 authorizes the Secretary of the Treasury to 
enforce the import and export prohibitions while the President 
has enforcement authority relating to domestic activities. The 
designated enforcement authorities are required to publish a 
list of violators at least once a year, to submit an 
enforcement plan to Congress within three months of the date of 
enactment, a report within one year of that same date, and, 
annually thereafter, a report on enforcement efforts and 
adequacy of resources to execute this provision. Finally, the 
legislation amends the Fur Products Labeling Act (15 U.S.C. 
69(d)) to require the labeling of products containing even a de 
minimus amount of dog or cat fur.
    Requirements applicable to cigarette imports.--Title V of 
the Tariff Suspension and Trade Act of 2000 (Public Law 106-
476) made several changes to laws governing the importation of 
cigarettes. In particular, section 4004 of this legislation 
amended the Tariff Act of 1930 to create a new title VIII 
imposing certain requirements on imports of cigarettes. Section 
4004 requires the following:
          (1) the original manufacturer of cigarettes being 
        imported into the United States must certify that it 
        has timely submitted, or will timely submit, to the 
        Secretary of Health and Human Services the lists of 
        ingredients described in section 7 of the Federal 
        Cigarette Labeling and Advertising Act (FCLAA);
          (2) the precise warning statements in the precise 
        format specified in section 4 of the FCLAA must be 
        permanently imprinted on the cigarette packaging. Prior 
        to the legislation, the Federal Trade Commission 
        allowed importers, under certain circumstances, to 
        comply with the requirements of FCLAA by affixing 
        adhesive labels with compliant warning statements;
          (3) the importer must certify that it is in 
        compliance with a rotation plan approved by the Federal 
        Trade Commission pursuant to section 4(c) of the FCLAA, 
        unless the FTC grants a waiver; and
          (4) if the cigarettes bear a United States registered 
        trademark, the owner of such trademark, or such owner's 
        authorized representative, must consent to the 
        importation of such cigarettes into the United States.
    The legislation also requires Customs certification at the 
time of entry that the importer, under the penalty of perjury, 
has complied with the above requirements. Cigarettes imported 
in personal use quantities, as well as those imported for 
analysis, noncommercial use, reexport or repackaging, are 
exempt from the above requirements. In addition to any other 
applicable penalties under law, violators are subject to civil 
penalties as well as forfeiture.

                         Commercial Operations

    Advisory Committee.--Section 9503(c) of the Omnibus Budget 
Reconciliation Act of 1987 (Public Law 100-203) established in 
the Department of Treasury the ``Advisory Committee on 
Commercial Operations of the United States Customs Service.'' 
The Assistant Secretary of Treasury for Enforcement is the 
Committee Chairman, which is composed of 20 members.
    In making appointments, the Secretary is to select 
individuals or firms ``affected by the commercial operations'' 
of the Customs Service. A majority of the members may not 
belong to the same political party. The Advisory Committee is 
required to provide advice to the Secretary on all Customs 
commercial operation matters and to report annually to the 
House Ways and Means and Senate Finance Committees.
    Management improvements.--The Customs and Trade Act of 1990 
made numerous changes to improve Customs commercial operations. 
Section 103 contained a biennial authorization of 
appropriations for the U.S. Customs Service, including a 
statutory funding floor for commercial operations and a ceiling 
on non-commercial (enforcement) operations.
    Section 121 made major amendments to the Customs Forfeiture 
Fund statute (section 613A of the Tariff Act of 1930) and in 
the administrative forfeiture proceedings authority (section 
607 of the Tariff Act of 1930).
    The Act also included several provisions recommended by the 
House Ways and Means Subcommittee on Oversight.\87\ Section 123 
required an annual national trade and customs law violation 
estimate and enforcement strategy report. Section 124 required 
an Administration report on possible expansion of Customs' 
foreign preclearance operations and legislative proposals for 
recovery for imported merchandise damaged during customs 
examination. Finally, the Act required changes to Customs' cost 
accounting systems and new labor distribution surveys.
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    \87\ ``Report on Abuses and Mismanagement in the U.S. Customs 
Service Commercial Operations''; February 8, 1990; WMCP: 101-22.
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    In 1992, the annual Treasury appropriations legislation for 
fiscal year 1993 (Public Law 102-393) created a unified 
Treasury Asset Forfeiture Fund to be administered by the 
Treasury Secretary. It succeeded the Customs Forfeiture Fund 
(section 613A of the Tariff Act). The Committee on Ways and 
Means maintains legislative jurisdiction over the Customs 
portion of the Treasury Fund.
    A major reform to the customs inspector pay system was 
included in the Omnibus Budget Reconciliation Act of 1993. 
Section 5 of the Act of February 13, 1911 (the ``1911'' Act) 
was amended to address the existing inspector overtime pay 
system (WMCP:102-17). It also authorized foreign language 
bonuses and additional retirement benefits linked to a portion 
of overtime hours worked.
    Notification requirements.--Section 9501(c) of the Omnibus 
Budget Reconciliation Act prohibited the establishment of any 
new Centralized Examination Station (CES) unless Customs 
provides written notice to both the House Ways and Means and 
Senate Finance Committees not less than 90 days prior to the 
proposed establishment.
    The Omnibus Budget Reconciliation Act of 1987 required the 
Commissioner of Customs to notify the House Ways and Means and 
Senate Finance Committees at least 180 days prior to taking any 
action which would: (a) result in any significant reduction in 
force of employees by means of attrition; (b) result in any 
reduction in hours of operation or services rendered at any 
customs office; (c) eliminate or relocate any customs office; 
(d) eliminate any port, or significantly reduce the number of 
employees assigned to any customs office or any port of entry.
    Customs modernization.--The Customs Modernization Act 
(title VI of the North American Free Trade Agreement 
Implementation Act) represented the most extensive set of 
changes to the customs laws since the Customs Procedural Reform 
Act of 1978. The major provisions of the Act removed archaic 
statutory provisions requiring paper documentation, and 
provided authority for full electronic processing of all 
customs-related transactions under the National Customs 
Automation Program (NCAP) (section 631). In return for waiving 
paperwork requirements, importers were required to maintain and 
produce information after the fact. Section 631 further sets 
forth the NCAP goals of ensuring uniform importer treatment, 
facilitating business activity, while improving compliance with 
the customs laws. It authorized new automation initiatives for 
remote-entry filing and periodic entry and duty payment, and 
required adequate planning, testing, and evaluation of all new 
automated systems before implementation.
    The Act provided for accreditation of independent 
laboratories and public access to all Customs rulings and 
decisions. It also provided additional projections for 
importers by reforming Customs' seizure authority under section 
596(c) of the Tariff Act of 1930 (19 U.S.C. 1595a(c)); 
established a new statute of limitations on duty violations, 
provided procedural safeguards for regulatory audits; allowed 
judicial review of detentions; clarified the conditions under 
which duty drawback claims may be made; and authorized payment 
for damaged merchandise for non-commercial shipments.
    In the on-going effort to fully implement the Mod Act, the 
Miscellaneous Trade and Technical Corrections Act of 1999 
(Public Law 106-36) (the Act) amended section 411 of the Tariff 
Act of 1930 (19 U.S.C. 1411) to require Customs, pursuant to 
the NCAP, to establish a program for the automation of 
electronic filing of commercial importation data from foreign-
trade zones no later than January 1, 2000.
    The Tariff Suspension and Trade Act of 2000 (Public Law 
106-476) also made needed changes to facilitate trade relating 
to large shipments that could not be shipped as an entirety. 
Prior to this legislation, large articles, including machinery, 
which could not fit on a single conveyance, particularly a 
truck or plane, were required to be classified as parts or in 
their condition upon arrival in the customs territory of the 
United States, causing classification or entry problems for 
both Customs and the importer. This legislation amended section 
1484 of title 19 to provide Customs the authority to treat 
goods purchased and invoiced as a single entity and shipped 
unassembled or disassembled in separate shipments over a period 
of time as a single transaction for customs entry purposes. The 
legislation requires importers to request such treatment in 
advance of entry and also requires the Secretary of the 
Treasury to issue regulations setting forth the information 
required for this type of entry.
    The Act also requires the Secretary of the Treasury to 
review, in consultation with U.S. importers and other 
interested parties, Customs procedures, related laws, and 
regulations in order to determine the minimum data required for 
determining admissibility of goods entering the United States. 
The legislation requires that the Secretary submit a report to 
Congress and make recommendations for changes in law, 
regulations, or procedures. The purpose of this report is to 
improve the efficiency of the entry process while meeting 
timely administrative needs for statistics and data collection.
    Reorganization.--Pursuant to section 301 of the Customs 
Procedural Reform and Implementation Act of 1978 (19 U.S.C. 
2075), on September 30, 1994, the Commissioner of Customs 
notified the House Ways and Means and Senate Finance Committees 
of his intention to implement a major reorganization of Customs 
commercial operations, including concentrating services at 
existing port facilities, reducing Headquarters staff, 
eliminating regional and district offices, and establishing 
Customs Management and Strategic Trade Centers.
    Antiterrorism.--The Comprehensive Antiterrorism Act of 1995 
(Public Law 104-132), designed to prevent and punish acts of 
terrorism, makes it unlawful to import plastic explosives which 
do not contain detection devices. The Act amends the Tariff Act 
of 1930 to facilitate Customs interdiction of these plastic 
explosives under its seizure and forfeiture authority.

                          Foreign Trade Zones

    The Foreign Trade Zones Act of 1934,\89\ as amended, 
authorizes the establishment of foreign trade zones. A foreign 
trade zone (FTZ) is a special enclosed area within or adjacent 
to ports of entry, usually located at industrial parks or in 
terminal warehouse facilities. Although operated under the 
supervision and enforcement of the Customs Service, they are 
considered outside the customs territory of the United States. 
With certain exceptions, any foreign or domestic merchandise 
may be brought into a foreign trade zone for storage, sale, 
exhibition, break-of-bulk, repacking, distribution, mixing with 
foreign or domestic merchandise, assembly, manufacturing, or 
other processing. Foreign merchandise imported into an FTZ is 
not subject to duty, formal entry procedures or quotas unless 
and until it is subsequently imported into U.S. customs 
territory.
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    \89\ Act of June 18, 1934, ch. 590, 48 Stat. 998, 19 U.S.C. 81a-
81u.
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    The framework that governs the establishment and operation 
of FTZs has three principal components. First, the Foreign 
Trade Zones Act of 1934 (the Act) authorizes the establishment 
of FTZs and, as amended in 1950, allows manufacturing in 
FTZs.\90\ Second, regulations, promulgated by both the Customs 
Service \91\ and the Department of Commerce,\92\ expand on the 
Act. A 1952 amendment to the regulations provided for the 
establishment of ``subzones'' in addition to general purpose 
zones. Third, the decision in Armco Steel Corp. v. Stans in 
1970 validated the use of zone manufacturing to avoid customs 
duties and interpreted several key provisions of the Act.\93\
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    \90\ Boggs amendment of 1959, ch. 296, 64 Stat. 246, 19 U.S.C. 81c.
    \91\ 19 CFR 146.0-48 (1980).
    \92\ 15 CFR 400.100-1406 (1980).
    \93\ 431 F.2d 779 (2d Cir. 1970), aff'g 303 F. Supp. 262 (S.D.N.Y. 
1969).
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    The original purpose of the Foreign Trade Zones Act of 1934 
was to expedite and encourage foreign commerce. Initially, FTZs 
were little more than transshipment or consignment centers for 
the storage, repackaging, or light processing of foreign goods 
pending re-exportation. The 1934 Act prohibited the manufacture 
and exhibition of goods in FTZs. In 1950, however, Congress 
removed this prohibition and added manufacturing to the list of 
activities permitted, and authorized exhibition in zones.
    The amendment to the FTZ regulations in 1952 that provided 
for the establishment of subzones is important to manufacturing 
and assembly operations in zones. The essential distinction 
between the two types of zones is that individual subzones are 
generally used by only one firm, whereas there is no limitation 
on the number of firms that can operate in a general-purpose 
zone. Subzones were established to assist companies which were 
unable to relocate to or take advantage of an existing general-
purpose zone.\94\ Under the regulations, only a grantee of a 
previously approved general zone may apply to establish a 
subzone.
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    \94\ 15 CFR 400.304 (1983).
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    Authority for establishing these facilities is granted to 
qualified corporations, or political subdivisions, who must 
submit applications to the Department of Commerce's Foreign 
Trade Zones Board, comprised of the Secretary of Commerce 
(Chair), and the Secretary of the Treasury.\95\ Public Law 104-
201, authorizing appropriations for fiscal year 1997 for the 
military activities of the Department of Defense, amended the 
Foreign Trade Zones Act to remove the Secretary of Army from 
membership on the Board. The Board's regulations set forth the 
basic requirements for applying and qualifying for an FTZ. The 
statute provides that every officially designated port of entry 
is entitled to at least one FTZ. Public hearings are often held 
by the Board staff in the locale involved. While most 
applications are non-controversial, occasionally domestic 
industries or labor that are sensitive to imports will oppose a 
subzone application. The sharp growth of manufacturing in 
subzones, particularly by the automobile industry, has led to 
increased criticism of the practice by U.S. parts producers, 
who are concerned that the practice may reduce their effective 
tariff protection.
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    \95\ 19 U.S.C. 81a(b) (1976). The jurisdiction and authority of the 
Board are set forth in 15 CFR 400.200-203 (1980).
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    Section 3, which contains the basic substantive provisions 
of the Act, allows merchandise to be imported into FTZs without 
being subject to U.S. customs laws. The section regulates the 
tariff treatment of FTZ merchandise according to its status as 
foreign or domestic, and as privileged or non-privileged.
    One may apply for privileged status for foreign merchandise 
in an FTZ, provided the merchandise has not yet been 
manipulated or manufactured so as to effect a change in its 
tariff classification. Foreign merchandise that is not 
privileged, recovered waste, and merchandise that was 
originally domestic but can no longer be identified as such, 
are deemed to be non-privileged foreign merchandise. Domestic 
merchandise that would otherwise have been eligible for 
privileged status but for which no application was made is 
considered non-privileged merchandise.
    The status of merchandise becomes significant when it 
enters U.S. customs territory. Customs appraises and classifies 
privileged foreign merchandise to determine the taxes and 
duties owed according to the condition of the merchandise when 
it enters an FTZ. The importer pays the previously determined 
taxes and duties when bringing the merchandise into U.S. 
customs territory regardless of any manufacturing or 
manipulation of the goods with other foreign or domestic 
privileged merchandise.
    In contrast, merchandise that is composed entirely of, or 
derived entirely from, non-privileged merchandise, either 
foreign or domestic, or of a combination of privileged and non-
privileged merchandise, is appraised and classified according 
to its condition when constructively transferred out of an FTZ 
and into U.S. customs territory. Thus, the duty and taxes 
payable on non-privileged or combined merchandise are those 
applicable to its classification and value when it enters U.S. 
customs territory and not when it enters the zone. This 
distinction is an important potential advantage of zone-based 
operations.
    The United States-Canada Free-Trade Agreement 
Implementation Act \96\ amended section 3(a) of the Foreign 
Zones Act to provide that, with the exception of ``drawback 
eligible goods,'' goods withdrawn from a foreign trade zone 
will be treated as if they are withdrawn for consumption in the 
United States, thus subject to applicable customs duties. The 
North American Free Trade Agreement Implementation Act \97\ 
further amended section 3(a) to provide that ``goods subject to 
NAFTA drawback'' and withdrawn from a foreign trade zone will 
be treated as if they are withdrawn for consumption in the 
United States, and are thus subject to the applicable customs 
duties. The customs duties may be reduced or waived in an 
amount that is the lesser of the customs duties paid to the 
other NAFTA country upon import of the manufactured goods. The 
amendment also provides for the same treatment should Canada 
cease to be a NAFTA country and the suspension of the United 
States-Canada Free-Trade Agreement is terminated.
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    \96\ Public Law 100-449, approved September 28, 1988.
    \97\ Public Law 100-182, approved December 8, 1993.
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    In addition, an amendment to section 3 with respect to the 
calculation of relative values in the operations of petroleum 
refineries in a foreign trade zone was enacted in section 9002 
of the Technical and Miscellaneous Revenue Act of 1988.\98\
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    \98\ Public Law 100-647, approved November 10, 1988.
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    Final revised regulations--the first changes to those 
regulations since 1980--were issued by the FTZ Board on October 
8, 1991 (15 CFR Part 400) clarifying criteria for the 
establishment and review of FTZ (including subzone) operations. 
Among other provisions, the revised regulations authorize the 
review of zone and subzone operations to determine whether 
those operations provide a net economic benefit to the United 
States.
    Use of weekly entry filing.--Section 484 of the Tariff Act 
of 1930 (19 U.S.C. 1484) sets forth the procedures for the 
entry of merchandise imported into the United States. Under 
section 484, the Customs Service has permitted limited weekly 
entry filing for foreign trade zones (FTZ) since May 12, 1986, 
for merchandise which is manufactured or changed into its final 
form just prior to its transfer from the zone (manufacturing 
operations). Customs regulations governing entry into and 
removal from an FTZ are contained in Part 146 of the Customs 
Regulations (19 C.F.R. Part 146). The regulations permit zone 
users to make a weekly entry filing for all entries removed for 
an entire weekly period, allowing them to pay a single 
merchandise processing fee (MPF) for the entire weekly entry 
filing instead of an MPF for each entry removed from the zone.
    On March 14, 1997, in a Federal Register Notice (62 FR 
12129), Customs proposed a rulemaking that would have expanded 
the weekly entry filing to include merchandise involved in 
activities other than manufacturing operations (non-
manufacturing operations). The expanded weekly entry filing 
required electronic filing, which was expected to reduce the 
number of paper entries, facilitate entry processing, and 
reduce paper work and associated costs form the zones. Customs 
tested the expanded weekly entry procedure in a pilot program 
authorized in September 1994 for a selected number of zones.
    In a Federal Register Notice dated March 17, 1999, Customs 
withdrew the proposed amendment to the Customs regulations, 
reasoning that the proposed expanded weekly entry program would 
significantly reduce the collection of merchandise processing 
fees. As a result, weekly entry filing from a zone could only 
be used for entries involving manufacturing operations.
    Section 410 of the Trade and Development Act of 2000 
(Public Law 106-200) amended section 484 of the Tariff Act of 
1930 to establish a new section 19 U.S.C. 1484(a)(3). This 
legislation allows merchandise withdrawn from a foreign-trade 
zone during a week (i.e., any 7 calendar day period) to be the 
subject of a single entry filing, at the option of the zone 
operator or user. This statutory change allows zone users the 
option of making weekly entry filing for both manufacturing and 
non-manufacturing operations, and the merchandise processing 
fee would be collected as if all entries during one week were 
made as a single entry.
    Deferral of duty on certain production equipment.--The 
Miscellaneous Trade and Technical Corrections Act of 1996 
(Public Law 104-295) amended section 3 of the Foreign Trade 
Zones Act to permit the deferral of payment of duty on certain 
production equipment admitted into FTZs. The provision allows 
for duty on imported production equipment and components 
installed in a U.S. FTZ to be deferred until the equipment is 
ready to be placed into use for production. By allowing a 
manufacturer to assemble, install, and test the equipment 
before duties would be levied, this change is meant to 
encourage production in FTZs.


                      Chapter 2: TRADE REMEDY LAWS

              The Antidumping and Countervailing Duty Laws

    Two important trade remedy laws are the antidumping (AD) 
and countervailing duty (CVD) laws. Although these laws are 
aimed at different forms of unfair trade, they have many 
procedural and substantive similarities.

                     CVD Law: Subsidy Determination

    The purpose of the CVD law is to offset any unfair 
competitive advantage that foreign manufacturers or exporters 
might enjoy over U.S. producers as a result of foreign 
countervailable subsidies. Countervailing duties equal to the 
net amount of the countervailable subsidies are imposed upon 
importation of the subsidized goods into the United States.
    Subtitle A of title VII of the Tariff Act of 1930, as added 
by the Trade Agreements Act of 1979 and amended by the Trade 
and Tariff Act of 1984, the Omnibus Trade and Competitiveness 
Act of 1988, and the Uruguay Round Agreements Act of 1994,\1\ 
provides that a countervailing duty shall be imposed, in 
addition to any other duty, equal to the amount of net 
countervailable subsidy, if two conditions are met. First, the 
Department of Commerce (DOC) must determine that a 
countervailable subsidy is being provided, directly or 
indirectly, ``with respect to the manufacture, production, or 
export of a class or kind of merchandise imported, or sold (or 
likely to be sold) into the United States'' and must determine 
the amount of the net countervailable subsidy. Second, the U.S. 
International Trade Commission (ITC) must determine that ``an 
industry in the United States is materially injured, or is 
threatened with material injury, or the establishment of an 
industry in the United States is materially retarded, by reason 
of imports of that merchandise or by reason of sales (or the 
likelihood of sales) of that merchandise for importation.'' The 
law applies to imports from World Trade Organization (WTO) 
member countries, which have assumed obligations equivalent to 
those of the Agreement on Subsidies and Countervailing 
Measures, commonly referred to as the Subsidies Agreement, or 
countries with whom the United States has a treaty requiring 
unconditional most-favored-nation treatment with respect to 
articles imported into the United States. A countervailing duty 
may not be imposed on imports from these countries unless it is 
established that a countervailable benefit has been imposed and 
a determination has been made that such subsidized imports 
injure or threaten to injure domestic producers of that 
merchandise (i.e., the injury test). However, imports from 
countries which do not fall into one of these three categories 
are generally not afforded an injury test in CVD cases.
---------------------------------------------------------------------------
    \1\ 19 U.S.C. 1671.
---------------------------------------------------------------------------
Historical background: prior to the General Agreement on Tariffs and 
        Trade (GATT) rules

    The first U.S. statute dealing with foreign unfair trade 
practices was a CVD law passed in 1897. The provisions of the 
1897 statute remained substantially the same until 1979, when 
the U.S. CVD law was changed to conform with the agreement 
reached in the Tokyo Round of multilateral trade negotiations.
    The law prior to 1979 required the Secretary of the 
Treasury to assess countervailing duties on imported dutiable 
merchandise benefiting from the payment or bestowal of a 
``bounty or grant.'' The 1897 law authorized countervailing 
duties against any bounty or grant on the export of foreign 
articles. In 1922, Congress amended the provision to cover 
bounties or grants on the manufacture or production of 
merchandise as well as on its export. The amount of the 
countervailing duty was to equal the net amount of the ``bounty 
or grant.'' Prior to the amendments made by the Trade Act of 
1974, the CVD law applied only to dutiable merchandise and 
afforded no injury test.
    The Trade Act of 1974 made two important changes to the CVD 
law, although the substantive requirements of the CVD law 
remained virtually the same. First, it extended the application 
of the CVD law for the first time to duty-free imports, subject 
to a finding of injury as required by the international 
obligations of the United States (i.e., duty-free imports from 
GATT members).
    Second, the Trade Act of 1974 made extensive changes in 
many procedural aspects of the law, which had the effect of 
limiting executive branch discretion in administering the CVD 
statute. The responsibilities for CVD investigations were also 
split, with the Department of Treasury being responsible for 
subsidy determinations and the ITC being responsible for injury 
determinations. In 1979, under President Carter's 
Reorganization Plan No. 3, the responsibility for administering 
the subsidy portions of the CVD statute was transferred from 
the Department of the Treasury to the DOC.\2\
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    \2\ Exec. Order No. 12188, January 4, 1980, 44 Fed. Reg. 69273.
---------------------------------------------------------------------------
Tokyo Round Subsidies Code

    During the Tokyo Round of trade negotiations in the 1970's, 
a multilateral agreement governing the use of subsidies and 
countervailing measures was concluded and signed by the United 
States. In order to enforce obligations with regard to the use 
of subsidies, the Agreement provided for improved international 
procedure for notification, consultation and dispute settlement 
and, where a breach of an obligation concerning the use of 
subsidies is found to exist, or a right to relief exists 
countermeasures are contemplated. In addition to the 
availability of either remedial measures or countermeasures 
through the dispute settlement process, countries could also 
take traditional countervailing duty action to offset subsidies 
upon a showing of material injury to a domestic industry by 
reason of subsidized imports. The agreement set out criteria 
for material injury determinations.
    The key provisions of the Agreement were as follows: (1) 
prohibition of export subsidies on non-primary products as well 
as primary mineral products; (2) description of export 
subsidies which superseded the requirement that an export 
subsidy must result in export prices lower than prices for 
domestic sales, and inclusion of an updated illustrative list 
of subsidy practices; (3) recognition of the harmful trade 
effects of domestic subsidies and therefore, the permissibility 
of relief (including countermeasures) where such subsidies 
injure domestic producers and nullify or impair benefits of 
concessions under the GATT (including tariff bindings); or 
cause serious prejudice to the other signatories; (4) 
commitment by signatories to ``take into account'' conditions 
of world trade and production (e.g., prices, capacity, etc.) in 
fashioning their subsidy practices; (5) improved discipline on 
the use of export subsidies for agriculture; (6) provisions 
governing the use and phase-out of export subsidies by 
developing countries; (7) tight dispute settlement process; (8) 
greater transparency regarding subsidy practices including 
provisions for GATT notification of practices of other 
countries; (9) an injury and causation test designed to afford 
relief where subsidized imports (whether an export or domestic 
subsidy is involved) impact on U.S. producers either through 
volume or through effect on prices; and (10) greater 
transparency in the administration of CVD laws and regulations.
    Congress approved the GATT Subsidies Code under section 
2(a) of the Trade Agreements Act of 1979. Section 101 of the 
1979 Act added a new title VII to the Tariff Act of 1930, 
containing the new provisions of the CVD law to conform to U.S. 
obligations under the Subsidies Code. One of the most 
fundamental changes made by the 1979 Act was the requirement of 
an injury test in all CVD cases involving imports from 
``countries under the Agreement''--countries which either are 
signatories to the Subsidies Code or have assumed substantially 
equivalent obligations to those under the Code. For countries 
that were not ``countries under the Agreement,'' a special 
section of the CVD statute applied. Specifically, section 303 
of the Tariff Act of 1930, as amended, permitted countervailing 
duties to be imposed without an injury test for such countries. 
In addition, section 303 applied a different definition of 
subsidy. Other changes made by the 1979 Act included the grant 
of provisional relief for the first time, reduction of the time 
periods for investigation, and greater opportunities for 
participation by interested parties.

Uruguay Round Subsidies Agreement

    The Uruguay Round Subsidies Agreement goes beyond the Tokyo 
Round Code by: (1) providing definitions of key terms such as 
``subsidy'' and ``serious prejudice'' for the first time in any 
GATT agreement; (2) prohibiting export subsidies and subsidies 
based on the use of domestic instead of imported goods; (3) 
creating a special presumption of serious prejudice for 
egregious subsidies; (4) defining and significantly 
strengthening the procedures for showing when serious prejudice 
exists in foreign markets; (5) creating a ``green light'' 
category (which lapsed January 1, 2000) of government 
assistance that is non-actionable and non-countervailable; (6) 
requiring most developing countries to phase out export 
subsidies and import substitution subsidies; and (7) applying 
the WTO dispute settlement mechanism, which will end the 
present ability of the subsidizing government to block adoption 
of unfavorable panel reports.
    In 1994, Congress implemented the Agreement on Subsidies 
and Countervailing Measures of the Uruguay Round Multilateral 
Trade Negotiations (Subsidies Agreement) under title II of the 
Uruguay Round Trade Agreements Act. Part 2 of subtitle B under 
title II contains the repeal of section 303 of the Tariff Act 
of 1930 and the new provisions of the CVD law to conform to 
U.S. obligations under the Subsidies Agreement.
    The Act provides for the application of an injury test to 
all members of the WTO. The definition of a subsidy applicable 
to non-WTO members was incorporated in section 701 of the 
Tariff Act of 1930. Accordingly, section 303 was repealed 
because it was no longer necessary. The Uruguay Round 
Agreements Act provides a special procedure for making injury 
determinations for those CVD orders, previously issued under 
section 303, which apply to goods from a country not a 
signatory to the Code but now a member of the WTO.

Highlights of the Uruguay Round Subsidies Agreement and CVD Statute

    Definition of a subsidy.--Section 251 of the Uruguay Round 
Agreements Act provides that a subsidy is determined to exist 
if there is a financial contribution by a government or any 
public body, or any form of income or price support, which 
confers a benefit. Examples of financial contribution include a 
direct transfer of funds (e.g., grants, loans, equity 
infusions), a potential direct transfer (e.g., loan 
guarantees), the foregoing of revenue otherwise due (e.g., tax 
credits), the provision of goods or services, other than 
general infrastructure, or the purchase of goods. This may also 
include cases where a government entrusts or directs a private 
body to carry out these functions. The Uruguay Round Agreements 
Act also provides guidelines for determining when there is a 
``benefit to the recipient'' in the case of an equity infusion, 
a loan, a loan guarantee, or provision of goods or services.
    Specificity.--In determining whether a countervailable 
subsidy exists, the statute provides that a subsidy will be 
deemed to be ``specific'' if it is provided in law or in fact 
to a specific enterprise or industry, or group of enterprises 
or industries. Export subsidies (i.e., those contingent upon 
export performance), import substitution subsidies (i.e., those 
contingent on the use of domestic over imported goods), and 
certain domestic subsidies if provided to a specific enterprise 
or industry, or group of enterprises or industries are 
included. A subsidy limited to certain enterprises within a 
designated geographical region is considered specific.
    Prohibited ``red light'' subsidies.--The Agreement 
identifies two types of subsidies that are prohibited under all 
circumstances: (1) subsidies based on export performance and 
(2) subsidies based on the use of domestic rather than imported 
goods. Article III includes those covered in the illustrative 
list of export subsidies provided in annex I to the Agreement 
such as more favorable transport and freight terms for exports, 
special tax deductions based on export, and export credit 
guarantees or insurance programs providing rates that are 
inadequate to cover long-term operating costs. The Uruguay 
Round Agreements Act establishes procedures for investigating 
prohibited subsidies; if Commerce has reason to believe that 
foreign goods are benefiting from a prohibited subsidy, the 
United States Trade Representative (USTR) will then determine 
whether to initiate a section 301 investigation.
    Non-actionable ``green light'' subsidies.--The Agreement 
identifies three types of non-countervailable or ``green 
light'' subsidies: (1) certain research subsidies (excluding 
those provided to the aircraft industry); (2) subsidies to 
disadvantaged regions; and (3) subsidies for adaptation of 
existing facilities to new environmental requirements. The 
Uruguay Round Agreements Act provides expressly that the 
``green light'' provisions on research and pre-competitive 
development activity do not apply to civil aircraft products.
    The Agreement stipulates that the provisions on non-
actionable subsidies apply for 5 years, unless extended or 
modified. Because the Subsidies Committee of the WTO was unable 
to reach a consensus on extending the application of these 
provisions in their existing or modified form, the ``green 
light'' provisions automatically lapsed as of January 1, 2000. 
Accordingly, with the exception of non-specific subsidies, 
which remain non-actionable and non-countervailable, subsidies 
formerly qualifying as non-actionable ``green light'' subsidies 
now fall within the actionable category.
    Enforcement of U.S. rights.--Sections 281 and 282 of the 
Uruguay Round Agreements Act set forth a mechanism for 
enforcing U.S. rights under the Uruguay Round Subsidies 
Agreement, reviewing the operation of provisions in the 
Agreement relating to green light subsidies, and ensuring 
prompt and effective implementation of successful WTO dispute 
settlement proceedings.
    Section 282 of the Uruguay Round Agreements Act \3\ 
provides for an ongoing review of the Subsidies Agreement and 
establishes objectives for that review. Footnote 25 of the 
Subsidies Agreement required the Subsidies Committee to review 
the operation of the green light category of research subsidies 
within 18 months from the date of entry into force: January 1, 
1995. Under section 282, the Administration was required to 
include all green light subsidies in its review.
---------------------------------------------------------------------------
    \3\ Public Law 103-465, 19 U.S.C. 3572.
---------------------------------------------------------------------------
    Section 282(c) provides that subparagraphs B, C, D, and E 
of section 771 of the Tariff Act of 1930, which established the 
non-countervailable status of ``green light'' subsides under 
U.S. law, expire 66 months after the date of entry into force 
of the WTO unless extended by Congress. USTR is directed to 
consult with the appropriate congressional committees and the 
private sector and then submit legislation to implement an 
extension of the ``green light'' subsidies, if such an 
extension is agreed upon by the WTO. A bill to provide such an 
extension would be considered under ``fast track'' procedures. 
Because the Subsidies Committee of the WTO was unable to reach 
a consensus on extending the ``green light'' subsidies 
provisions by December 31, 1999, subparagraphs B, C, D, and E 
of section 771 of the Tariff act of 1930 expired on July 1, 
2000.
    Rules for developing countries.--The Uruguay Round 
Agreements Act provides different treatment for developing 
country subsidies because the Subsidies Agreement provides an 
8- to 10-year window for developing countries with annual GNP 
per capita at or above $1,000 to phase out all export 
subsidies. For least developed countries and countries with GNP 
per capita below $1,000, the phase-out period for export 
subsidies for competitive products is 8 years. Developing 
countries are allowed a 5-year phase-out period, and the least-
developed countries an 8-year period, to eliminate prohibited 
import substitution subsidies.

Subsidy determinations

    As noted above, section 701 of the Tariff Act of 1930, as 
amended,\4\ provides for the imposition of additional duties 
whenever a countervailable subsidy is bestowed by a foreign 
country upon the manufacture or production for export of any 
article which is subsequently imported into the United States. 
Reference to the sale of merchandise includes the entering into 
of any leasing arrangement regarding the merchandise that is 
equivalent to the sale of the merchandise. The countervailing 
duty will apply whether the merchandise is imported directly or 
from third countries, and whether or not in the same condition 
as when exported.
---------------------------------------------------------------------------
    \4\ 19 U.S.C. 1671.
---------------------------------------------------------------------------
    Again, as noted above, section 701(c) applies to a country 
which is not a ``Subsidies Agreement country.'' Under section 
701(c), a country which is not a ``Subsidies Agreement 
country'' is not entitled to an injury test. In addition, 
certain provisions pertaining to suspension agreements, special 
rules for regional industries, critical circumstances, and the 
5-year review of countervailing duty orders do not apply to 
such a country.
    Countervailing duties are imposed in the amount of the net 
countervailable subsidy as determined by the DOC. To determine 
the amount of net countervailable subsidy on which the CVD will 
be based, the DOC may subtract from gross countervailable 
subsidy the amount of:
          (1) any application fee, deposit, or similar payment 
        paid to qualify for or receive the subsidy;
          (2) any loss in the countervailable subsidy value 
        resulting from deferred receipt mandated by government 
        order; and
          (3) export taxes, duties, or other charges levied on 
        the exports to the United States specifically intended 
        to offset the countervailable subsidy.

Upstream subsidies

    The Trade and Tariff Act of 1984 modified the application 
of the CVD law to ``upstream subsidies''--subsidies bestowed on 
inputs which are then incorporated into the manufacture of a 
final product which is exported to the United States. Section 
268 of Uruguay Round Agreements Act further modified the law by 
establishing criteria for determining the existence of an 
upstream subsidy. Additional criteria were necessary given the 
additions of the statutory definition of subsidy and the new 
category of import substitution subsidies.
    Section 771(A) of the Tariff Act of 1930, as amended, which 
provides for upstream subsidies, is unrelated to the basic 
definition of a subsidy. The potential for an upstream subsidy 
exists only when a sector-specific benefit meeting all the 
other criteria of being a countervailable subsidy is provided 
to the input producer. A determination that the subsidy is also 
bestowing a ``competitive benefit'' on the merchandise is also 
required. The provision is also limited to countervailable 
subsidies paid or bestowed by the country in which the final 
product is manufactured.
    With regard to the ``competitive benefit'' criterion, the 
DOC must decide that a competitive benefit has been bestowed 
when the price for the input used in manufacture or production 
of the merchandise subject to investigation is lower than the 
price the manufacturer or producer would otherwise pay for the 
input from another seller in an arm's length transaction. 
Whenever the DOC has reasonable grounds to believe or suspect 
an upstream subsidy is being paid or bestowed, the DOC must 
investigate whether it is in fact and, if so, include the 
amount of any competitive benefit, not to exceed the amount of 
upstream subsidy, in the amount of any CVD imposed on the 
merchandise under investigation.

Agricultural subsidies

    Section 771(5B) provides a separate, special rule for the 
calculation of countervailable subsidies on certain processed 
agricultural products.

           AD Law: Less-Than-Fair-Value (LTFV) Determination

    Dumping generally refers to a form of international price 
discrimination, whereby goods are sold in one export market 
(such as the United States) at prices lower than the prices at 
which comparable goods are sold in the home market of the 
exporter, or in its other export markets.
    Three provisions of U.S. law address different types of 
dumping practices. The Antidumping Act of 1916 provides for 
criminal and civil penalties for the sale of imported articles 
at a price substantially less than the actual market value or 
wholesale price, with the intent of destroying or injuring an 
industry in the United States. Title VII of the Tariff Act of 
1930, as amended, provides for the assessment and collection of 
AD duties by the U.S. government after an administrative 
determination that foreign merchandise is being sold in the 
U.S. market at less than fair value and that such imports are 
materially injuring the U.S. industry. Finally, section 1317 of 
the Omnibus Trade and Competitiveness Act of 1988 establishes 
procedures for the USTR to request a foreign government to take 
action against third-country dumping that is injuring a U.S. 
industry, and section 232 of the Uruguay Round Agreements Act 
permits a third country to request that an order be issued 
against dumped imports from another country that are materially 
injuring an industry in a third country.

Historical background \5\

    In 1916 the Congress enacted the Antidumping Act of 1916, 
providing a civil cause of action in federal court for private 
damages as well as for criminal penalties against parties who 
dump foreign merchandise in the United States.\6\ The 
requirements under this statute, however, particularly the need 
to show evidence of intent, are difficult to meet, and the need 
for a different type of AD law was subsequently considered by 
Congress. In 1921 the Antidumping Act of 1921 was passed, which 
provided the statutory basis, until 1979, for an administrative 
investigation by the Department of the Treasury of alleged 
dumping practices and for imposition of AD duties.\7\ In 1954, 
the administration of the AD law was split, and the function of 
determining injury was transferred from the Treasury Department 
to the U.S. Tariff Commission (now the ITC). The function of 
determining sales at less than fair value was left with the 
Treasury Department until 1979.
---------------------------------------------------------------------------
    \5\ For another useful discussion of the history of the development 
of U.S. antidumping laws, see Congressional Budget Office, How the GATT 
affects U.S. Antidumping and Countervailing-Duty Policy, Sept. 1994.
    \6\ Act of September 8, 1916, ch. 463, sec. 801, 39 Stat. 798, 15 
U.S.C. 72.
---------------------------------------------------------------------------

          For a description of the challenge to the Antidumping Act of 
        1916 in the WTO brought by the European Union and Japan, see 
        the discussion of WTO Panel Reviews at the end of the AD/CVD 
        section.
---------------------------------------------------------------------------
    \7\ Act of May 27, 1921, ch. 14, 42 Stat. 11, 19 U.S.C. 160 (now 
repealed).
---------------------------------------------------------------------------
    During the post-World War II negotiations to establish an 
International Trade Organization, the United States proposed a 
draft article on dumping, based on the Antidumping Act of 1921. 
This draft became the basis for article VI of the GATT, which 
is the international framework governing national AD laws.
    During the 1960's, AD actions and their potential for 
abuse, rather than the dumping practice itself, became a source 
of great concern to many nations. As a result, during the 
Kennedy Round of multilateral trade negotiations, the GATT 
Antidumping Code of 1967 was established. The 1967 Code had 
three main functions: (1) to clarify and elaborate on the broad 
concepts of article VI of the GATT; (2) to supplement article 
VI by establishing appropriate procedural requirements for AD 
investigations; and (3) to bring all GATT signatory countries 
into conformity with article VI. The GATT Antidumping Code came 
into force on July 1, 1968, and provided for the establishment 
of a GATT Committee on Antidumping Practices, whose function 
was to review annually the operation of national antidumping 
laws.
    During the Tokyo Round of multilateral trade negotiations 
in the 1970's, the GATT Antidumping Code was amended to conform 
to the newly negotiated Agreement Relating to Subsidies and 
Countervailing Measures, also negotiated at that time and 
involving changes in article VI of the GATT. The GATT Agreement 
on Implementation of article VI of the GATT, Relating to 
Antidumping Measures, came into force on January 1, 1980.\8\
---------------------------------------------------------------------------
    \8\ Agreement on Implementation of article VI of the General 
Agreement on Tariffs and Trade, MTN/NTM/W/232, reprinted in House Doc. 
No. 96-153, pt. I at 311.
---------------------------------------------------------------------------
    The Congress approved the revised GATT Antidumping Code 
under section 2(a) of the Trade Agreements Act of 1979.\9\ 
Title I of the 1979 Act repealed the Antidumping Act of 1921 
and added a new title VII to the Tariff Act of 1930 
implementing the provisions of the Agreement in a new U.S. 
antidumping law. In addition to the substantive and procedural 
changes made by the 1979 Act, the responsibility for making 
dumping determinations was transferred from the Department of 
the Treasury to the DOC in 1979.\10\ The AD law was further 
amended by title VI of the Trade and Tariff Act of 1984,\11\ 
and title I, subtitle C, part 2 of the Omnibus Trade and 
Competitiveness Act of 1988.
---------------------------------------------------------------------------
    \9\ Public Law 96-39, approved July 26, 1979.
    \10\ Reorganization Plan No. 3 of 1979, 44 Fed. Reg. 69,273 (Dec. 
3, 1979); and Exec. Order No. 12188, January 2, 1980, 45 Fed. Reg. 989.
    \11\ Public Law 98-573, approved October 30, 1984. Technical 
corrections to the 1984 amendments were included in section 1886 of the 
Tax Reform Act of 1986, Public Law 99-514, approved October 22, 1986.
---------------------------------------------------------------------------
    Finally, during the Uruguay Round negotiations, provisions 
related to antidumping were further amended through the 
Agreement on Implementation of Article VI of the General 
Agreement on Tariffs and Trade 1994 (the Antidumping 
Agreement). Article VI of the original GATT remained unchanged 
in the 1994 GATT Agreement.
    Effective January 1, 1995, the Congress implemented the 
Antidumping Agreement under title II of the Uruguay Round 
Agreements Act. The Act made considerable substantive and 
procedural changes to the U.S. AD statute.

Basic provisions

    Section 731 of the Tariff Act of 1930, as amended,\12\ 
provides that an AD duty shall be imposed, in addition to any 
other duty, if two conditions are met. First, the DOC must 
determine that ``a class or kind of foreign merchandise is 
being, or is likely to be, sold in the United States at less 
than its fair value.'' The determination of whether LTFV sales 
exist, and what is the margin of dumping, is based on a 
comparison of ``normal value'' with the ``export price'' of 
each import sale made during the relevant time period under 
investigation. Second, the ITC must determine that ``an 
industry in the United States is materially injured, or is 
threatened with material injury, or the establishment of an 
industry in the United States is materially retarded, by reason 
of imports of that merchandise.'' If the DOC determines that 
LTFV sales exist and the ITC determines that material injury 
exists, an AD order is issued imposing AD duties equal to the 
amount by which normal value (i.e., the price in the foreign 
market) exceeds the export price (i.e., U.S. price) for the 
merchandise (the dumping margin).
---------------------------------------------------------------------------
    \12\ 19 U.S.C. 1673.
---------------------------------------------------------------------------

Basis of comparison: normal value

    Normal value is determined by one of three methods, in 
order of preference: home market sales, third-country sales, or 
constructed value. If a foreign like product is sold in the 
market of the exporting country for home consumption, then 
normal value is to be based on such sales. If home market sales 
do not exist, or are so few as to form an inadequate basis for 
comparison, then the price at which the foreign like product is 
sold for exportation to countries other than the United States 
becomes the basis for normal value. If neither home market 
sales nor third-country sales form an adequate basis for 
comparison, then normal value is the constructed value of the 
imported merchandise. Constructed value is determined by a 
formula set forth in the statute, which is the sum of costs of 
production, plus the actual amount of profit and for selling, 
general and administrative expenses. If actual data is not 
available, then a surrogate for profit and such expenses may be 
used, as specified in the statute.
    Normal value based on home market or third-country sales is 
a single price, in U.S. dollars, which represents the weighted 
average of prices in the home market or third-country market 
during the period under investigation. Sales made at less than 
the cost of production may be disregarded in the determination 
of normal value under certain circumstances. Adjustments are to 
be made for differences in merchandise, quantities sold, 
circumstances of sale, and differences in level of trade to 
provide for comparability of normal value with export price. 
Section 223(a)(7) of the Uruguay Round Agreements Act and the 
accompanying Statement of Administrative Action (SAA) changed 
the requirements for making level of trade adjustments to 
provide that the DOC is to make a level of trade adjustment 
(i.e., deduct the price difference between the two levels of 
trade) if sales are made at different levels of trade and the 
appropriate adjustment can be established. The level of trade 
adjustment was intended to provide the normal value counterpart 
to the related party profit deduction in constructed export 
price sales (described below) so that the effect is to compare 
a U.S. sale to a sale in the home market at the same point in 
the commercial transaction. Finally, averaging or sampling 
techniques may be used in the determination of normal value 
whenever a significant volume of sales is involved or a 
significant number of price adjustments is required.
    If the exporting country is a non-market economy, the 
normal value is constructed by valuing the non-market economy 
producer's ``factors of production'' in a market economy 
country which is a significant producer of comparable 
merchandise and which is at a level of economic development 
comparable to the non-market economy, and adding amounts for 
general expenses, profits, and packing. The ``factors of 
production'' include labor, raw materials, energy and other 
utilities, and representative capital costs.
    In determining whether a country is a non-market economy, 
the DOC will consider: the convertibility of the country's 
currency, whether wages are determined through free bargaining 
between labor and management, whether foreign investment is 
permitted, the extent of government ownership, and the extent 
of government control over the allocation of resources and the 
pricing and output decisions of enterprises. The DOC's 
determination of whether a country is a non-market economy is 
not subject to judicial review.

Export price

    The margin of dumping, and the amount of antidumping duty 
to be imposed, is determined by comparing the normal value with 
the export price of each entry into the United States of 
foreign merchandise subject to the investigation. Export price 
in general refers to either ``export price'' or the 
``constructed export price'' of the merchandise, whichever is 
appropriate. ``Export price'' is the price at which merchandise 
is purchased or agreed to be purchased prior to date of 
importation to the United States. It is typically used where 
the purchaser is unrelated to the foreign manufacturer and is 
based on the price agreed to before importation into the United 
States. However, it may be used if the purchaser and foreign 
manufacturer are related but the purchaser is merely the 
processor of sales-related documentation and does not set the 
price to the first unrelated customer. ``Constructed export 
price'' is the price at which merchandise is sold or agreed to 
be sold in the United States before or after importation, by or 
for the account of the producer or exporter to the first 
unrelated purchaser. Typically, it is used if the purchaser and 
exporter are related.
    Export price is adjusted to derive an ex-factory price, 
including the subtraction of certain delivery expenses and U.S. 
import duties. Additional subtractions are made from 
constructed export price, including selling commissions, 
indirect selling expenses, and expenses and profit for further 
manufacturing in the United States. In addition, the Uruguay 
Round Agreements Act provides for the deduction of an amount 
for related party profit, if any, earned in a sale through a 
related distributor to an end-user in the United States.

Third country dumping

    Section 1318 of the Omnibus Trade and Competitiveness Act 
of 1988 was enacted in response to concern over the injurious 
effects of foreign dumping in third country markets. Section 
1318 establishes procedures for domestic industries to petition 
the USTR to pursue U.S. rights under article 12 of the GATT 
Antidumping Code. A domestic industry that produces a product 
like or directly competitive with merchandise produced by a 
foreign country may submit a petition to USTR if it has reason 
to believe that such merchandise is being dumped in a third 
country market and such dumping is injuring the U.S. industry.
    If USTR determines there is a reasonable basis for the 
allegations in the petition, USTR shall submit to the 
appropriate authority of the foreign government an application 
requesting that antidumping action be taken on behalf of the 
United States. Article 12 of the GATT Antidumping Code requires 
that such an application ``be supported by price information to 
show that the imports are being dumped and by detailed 
information to show that the alleged dumping is causing injury 
to the domestic industry concerned.'' (paragraph 2, article 
12). Accordingly, at the request of the U.S. Trade 
Representative, the appropriate officers of the DOC and the ITC 
are to assist USTR in preparing any such application.
    After submitting an application to the foreign government, 
USTR must seek consultations with its representatives regarding 
the requested action. If the foreign government refuses to take 
any AD action, USTR must consult with the domestic industry on 
whether action under any other U.S. law is appropriate.
    The Uruguay Round Antidumping Agreement added a provision 
providing authority to issue an order upon the request of a 
third country, under certain circumstances. The Uruguay Round 
Agreements Act provides that the government of a WTO member may 
file with USTR a petition requesting that an investigation be 
conducted to determine if imports from another country are 
being dumped in the United States, causing material injury to 
an industry in the petitioning country. USTR, after 
consultation with the DOC and the ITC, and after obtaining the 
approval of the WTO Council for Trade in Goods, is to determine 
whether to initiate an investigation. If the DOC determines 
that imports are dumped and the ITC determines that an industry 
in the petitioning country is materially injured by such 
imports, the DOC is to issue an AD order.

             AD and CVD Laws: Material Injury Determination

    Prior to issuance of an AD or CVD order, the ITC must 
determine that the domestic industry is being materially 
injured, or threatened with material injury, or the 
establishment of a domestic industry is materially retarded, by 
reason of dumped or subsidized imports. The standard of injury 
under the AD and CVD laws is ``material injury,'' defined by 
section 771(7) of the Tariff Act of 1930 as harm which is not 
inconsequential, immaterial, or unimportant.
    The ITC determination of injury basically involves a two-
prong inquiry: first, with respect to the fact of material 
injury, and second, with respect to the causation of such 
material injury (i.e., that dumping caused the injury, and not 
other factors). The ITC is required to analyze the volume of 
imports, the effect of imports on U.S. prices of like 
merchandise, and the effects that imports have on U.S. 
producers of like products, taking into account many factors, 
including lost sales, market share, profits, productivity, 
return on investment, and utilization of production capacity. 
Also relevant are the effects on employment, inventories, 
wages, the ability to raise capital, and negative effects on 
the development and production activities of the U.S. industry. 
Finally, in AD investigations, the ITC is to consider the 
magnitude of the dumping margin.
    Section 222(b)(2) of the Uruguay Round Agreements Act (19 
U.S.C. 1677(7)(C)(iv)) states that, in determining market share 
and the factors affecting financial performance, the ITC is to 
focus primarily on the merchant market for the domestic like 
product if domestic producers internally transfer significant 
production of the domestic like product for the production of a 
downstream article (i.e., captive production not for sale on 
the merchant market). The SAA accompanying the implementing 
legislation makes clear that captively produced imports are not 
to be included in the import penetration ratio for the merchant 
market if they do not compete with merchant market 
production.\13\
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    \13\ The Uruguay Round Agreements Act Statement of Administrative 
Action at 853.
---------------------------------------------------------------------------
    Section 771(7) of the Tariff Act of 1930, as amended, 
requires the ITC to cumulatively assess the volume and effect 
of like imports from two or more countries subject to 
investigation if the imports compete with each other and with 
like products of the domestic industry in the U.S. market, as 
long as the relevant petitions were filed on the same day or 
investigations were initiated on the same day (for cases which 
were self-initiated). However, the ITC is to immediately 
terminate an investigation with respect to a country (and, 
hence, may not cumulate imports from that country) if imports 
from that country are ``negligible.'' Section 222(d) of the 
Uruguay Round Agreements Act amended the negligibility standard 
so that imports from a country are to be considered negligible 
if they account for less than 3 percent of the volume of all 
imports of such merchandise and if imports from all countries 
accounting for less than 3 percent do not exceed 7 percent of 
imports. Finally, the ITC has discretion not to cumulate 
imports when the imports subject to investigation are products 
of Israel.

               Issues Common to AD and CVD Investigations

Initiation of investigation

    AD and CVD investigations may be self-initiated by the DOC 
or may be initiated as a result of a petition filed by an 
interested party. Petitions may be filed by any of the 
following, on behalf of the affected industry: (1) a 
manufacturer, producer, or wholesaler in the United States of a 
like product; (2) a certified or recognized union or group of 
workers which is representative of the affected industry; (3) a 
trade or business association with a majority of members 
producing a like product; (4) a coalition of firms, unions, or 
trade associations that have individual standing; or (5) a 
coalition or trade association representative of processors, or 
processor and growers, in cases involving processed 
agricultural products. The DOC is required to provide technical 
assistance to small businesses to enable them to prepare and 
file petitions.
    Petitions are to be filed simultaneously with both the DOC 
and ITC. Within 20 days after the filing of a petition, the DOC 
must decide whether or not the petition is legally sufficient 
to commence an investigation. If so, an investigation is 
initiated with respect to imports of a particular product from 
a particular country.
    Because of new standing provisions in the Uruguay Round 
Agreements, section 212 of the Uruguay Round Agreements Act 
requires DOC to determine, as part of its initiation 
determination, whether the petition has been filed by or on 
behalf of the industry. A petitioner has standing if: (1) the 
domestic producers or workers who support the petition account 
for at least 25 percent of the total production of the like 
product; and (2) the domestic producers or workers who support 
the petition account for more than 50 percent of the production 
of the domestic like product produced by that portion of the 
industry expressing support for or opposition to the petition. 
The SAA accompanying the Act specifies that if the management 
of a firm expresses a position in direct opposition to the 
views of the workers in that firm, DOC will treat the 
production of that firm as representing neither support for nor 
opposition to the petition.\14\ The DOC is to poll the industry 
if the petition does not meet the second test set forth above. 
In such circumstances, the DOC is permitted 40 days in which to 
determine whether it will initiate an investigation. Standing 
of the industry may not be challenged to the agency after an 
investigation is initiated but may be challenged later in 
court.
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    \14\ Uruguay Round Agreements Act Statement of Administrative 
Action at 862.
---------------------------------------------------------------------------
    Section 609 of the Trade and Tariff Act of 1984 establishes 
a procedure in AD investigations by which the DOC may monitor 
imports from additional supplier countries for up to 1 year in 
order to determine whether persistent dumping exists with 
respect to that product and self-initiation of additional 
dumping cases is warranted.

Preliminary ITC injury determination

    The ITC must determine whether there is a ``reasonable 
indication'' of material injury, based on the information 
available to it at the time. The petitioner bears the burden of 
proof with respect to this issue. If the ITC preliminary 
determination is negative, the investigation is terminated. If 
it is positive, the investigation continues. The ITC is to make 
this determination within 45 days of the date of filing of the 
petition or self-initiation, or within 25 days after the date 
on which the ITC receives notice of initiation if the DOC has 
extended the period for initiation in order to poll the 
industry to determine standing.

Preliminary DOC determination

    If the ITC makes an affirmative preliminary injury 
determination, then the DOC must determine whether dumping or 
subsidization is occurring.
    In AD cases, the DOC must determine whether there is a 
``reasonable basis to believe or suspect that the merchandise 
is being sold, or is likely to be sold, at less than fair 
value,'' within 140 days after initiation. The preliminary 
determination is based on the information available to the DOC 
at the time. If affirmative, the preliminary determination must 
include an estimated average amount by which the normal value 
exceeds the export price. An expedited preliminary 
determination within 90 days of initiation of the investigation 
may be made based on information received during the first 60 
days if such information is sufficient and the parties provide 
a written waiver of verification and an agreement to have an 
expedited preliminary determination. A preliminary 
determination may also be expedited for cases involving short 
life cycle merchandise, if the foreign producer has been 
subject to prior affirmative dumping determinations on similar 
products. On the other hand, the preliminary determination may 
be postponed until 190 days after initiation by the DOC, at the 
petitioner's request or in cases which the DOC determines are 
extraordinarily complicated.
    In subsidy cases, the DOC must determine whether there is a 
``reasonable basis to believe or suspect that a countervailable 
subsidy is being provided,'' within 65 days after initiation of 
the investigation. In cases involving upstream subsidies, the 
time period may be extended to 250 days. If affirmative, the 
preliminary determination must include an estimated amount of 
the net countervailable subsidy. An expedited preliminary 
determination may be made based on information received during 
the first 50 days if such information is sufficient and the 
parties provide a written waiver of verification and agree to 
an expedited preliminary determination. On the other hand, the 
preliminary determination may be postponed until 130 days after 
initiation at the petitioner's request or in cases which the 
DOC determines are extraordinarily complicated.
    The effect of an affirmative preliminary determination is 
twofold: (1) The DOC must order the suspension of liquidation 
of all entries of foreign merchandise subject to the 
determination from the date of publication of the preliminary 
determination. The DOC must also order the posting of a cash 
deposit, bond, or other appropriate security for each 
subsequent entry of the merchandise equal to the estimated 
margin of dumping or the amount of the net countervailable 
subsidy; and (2) the ITC must begin its final injury 
investigation, and the DOC must make all information available 
to the ITC which is relevant to an injury determination. If the 
preliminary determination is negative, no suspension of 
liquidation occurs, and the DOC investigation simply continues 
into the final stage.
    In AD investigations in which the petitioner alleges 
critical circumstances, the DOC must determine, on the basis of 
information available at the time, whether (1) there is a 
history of dumping and material injury in the United States or 
elsewhere of the subject merchandise, or the importer knew or 
should have known that the merchandise was being sold at less 
than fair value and that there was likely to be material injury 
by reason of such sales; and (2) there have been massive 
imports of the merchandise over a relatively short period.
    In CVD investigations involving ``countries under the 
Agreement'' in which the petitioner alleges critical 
circumstances, the DOC must determine, on the basis of 
information available at the time, whether (1) the alleged 
countervailable subsidy is inconsistent with the GATT Subsidies 
Agreement; and (2) there have been massive imports of the 
merchandise over a relatively short period.
    In both AD and CVD investigations, this critical 
circumstances determination may be made beginning prior to a 
preliminary determination of subsidies or sales at less than 
fair value. If the DOC determines critical circumstances exist, 
then any suspension of liquidation ordered is to retroactively 
apply to unliquidated entries of merchandise entered up to 90 
days prior to the date suspension of liquidation was ordered.

Final DOC determination

    In AD investigations, the DOC must issue its final LTFV 
determination within 75 days after the date of its preliminary 
determination, unless a timely request for extension is 
granted, in which case the final determination must be made 
within 135 days. In CVD investigations, the DOC must issue a 
final subsidy determination within 75 days after the date of 
its preliminary determination, unless the investigation 
involves upstream subsidies, in which case special extended 
time limits apply. If there are simultaneous investigations 
under the AD and CVD laws involving imports of the same 
merchandise, the final CVD determination may be postponed until 
the date of the final determination in the AD investigation at 
the request of a petitioner.
    In both LTFV and subsidy investigations, the investigation 
is terminated if the final determination is negative, including 
any suspension of liquidation which may be in effect, and all 
estimated duties are refunded and all appropriate bonds or 
other security are released. If the final determination is 
affirmative, the DOC orders the suspension of liquidation and 
posting of a cash deposit, bond, or other security (if such 
actions have not already been taken as a result of the 
preliminary determination), and awaits notice of the ITC final 
injury determination.

Final ITC injury determination

    Within 120 days of a DOC affirmative preliminary 
determination or 45 days of a DOC affirmative final 
determination, whichever is longer, the ITC must make a final 
determination of material injury. If the DOC preliminary 
determination is negative, and the DOC final determination is 
affirmative, the ITC has until 75 days after the final 
affirmative determination to make its injury determination.

Termination or suspension of investigations

    Either the DOC or ITC may terminate an AD or CVD 
investigation upon withdrawal of the petition by petitioner, or 
by the DOC if the investigation was self-initiated. The DOC may 
not, however, terminate an investigation on the basis of a 
quantitative restriction agreement limiting U.S. imports of the 
merchandise subject to investigation unless the DOC is 
satisfied that termination on the basis of such agreement is in 
the public interest.
    The DOC may suspend a CVD investigation on the basis of one 
of three types of agreements entered into with the foreign 
government or with exporters who account for substantially all 
of the imports under investigation. The three types of 
agreements are: (1) an agreement to eliminate the subsidy 
completely or to offset completely the amount of the net 
countervailable subsidy within 6 months after suspension of the 
investigation; (2) an agreement to cease exports of the 
subsidized merchandise to the United States within 6 months of 
suspension of the investigation; and (3) an agreement to 
eliminate completely the injurious effect of subsidized exports 
to the United States (which, unlike under the AD law, may be 
based on quantitative restrictions).
    The DOC may suspend an AD investigation on the basis of one 
of three types of agreements entered into with exporters who 
account for substantially all of the imports under 
investigation: (1) an agreement to cease exports of the 
merchandise to the United States within 6 months of suspension 
of the investigation; (2) an agreement to revise prices to 
eliminate completely any sales at less than fair value; and (3) 
an agreement to revise prices to eliminate completely the 
injurious effect of exports of such merchandise to the United 
States. Unlike CVD cases, AD investigations cannot generally be 
suspended on the basis of quantitative restriction agreements. 
The one exception is where the AD investigation involves 
imports from a non-market economy country.
    The DOC may not, however, accept any suspension agreement 
in either an AD or CVD investigation unless it is satisfied 
that suspension of the investigation is in the public interest, 
and effective monitoring of the agreement is practicable. If 
the DOC determines not to accept a suspension agreement, it is 
to provide to the exporters who would have been subject to the 
agreement both the reasons for not accepting the agreement and 
an opportunity to submit comments, where practicable.
    Prior to actual suspension of an investigation, the DOC 
must provide notice of its intent to suspend and an opportunity 
for comment by interested parties. When the DOC decides to 
suspend the investigation, it must publish notice of the 
suspension, and issue an affirmative preliminary LTFV or 
subsidy determination (unless previously issued). The ITC also 
suspends its investigation. Any suspension of liquidation 
ordered as a result of the affirmative preliminary LTFV 
determination, however, is to be terminated, and all deposits 
of estimated duties or bonds posted are to be refunded or 
released.
    If, within 20 days after notice of suspension is published, 
the DOC receives a request for continuation of the 
investigation from a domestic interested party or from 
exporters accounting for a significant proportion of exports of 
the merchandise, then both the DOC and ITC must continue their 
investigations.
    The DOC has responsibility for overseeing compliance with 
any suspension agreement. Intentional violations of suspension 
agreements are subject to civil penalties.

AD or CVD order

    An AD or CVD order may be issued only if both the DOC and 
ITC issue affirmative final determinations, in both title VII 
AD and CVD investigations and in section 303 CVD investigations 
requiring an injury test.
    A DOC final LTFV determination must include its 
determinations of normal value and export price, which are the 
basis for assessment of AD duties and for deposit of estimated 
AD duties on future entries. Within 7 days of notice of an 
affirmative final ITC determination, the DOC must issue an AD 
duty order which (1) directs the Customs Service to assess AD 
duties equal to the amount by which normal value exceeds the 
export price, i.e., the dumping margin; (2) describes the 
merchandise to which the AD duty applies; and (3) requires the 
deposit of estimated AD duties pending liquidation of entries, 
at the same time as estimated normal customs duties are 
deposited. The DOC must publish notice of its final 
determination, which shall be the basis for assessment of AD 
duties and for deposit of estimated AD duties on future 
entries.
    For CVD investigations, the DOC must issue a CVD order 
within 7 days of notice of an affirmative final ITC 
determination, which (1) directs the Customs Service to assess 
countervailing duties equal to the amount of the net 
countervailable subsidy; (2) describes the merchandise to which 
the countervailing duty applies; and (3) requires the deposit 
of estimated countervailing duties pending liquidation of 
entries, at the same time as estimated normal customs duties 
are deposited. The DOC must publish notice of its determination 
of net countervailable subsidy which shall be the basis for 
assessment of countervailing duties and for deposit of 
estimated countervailing duties on future entries.

Differences between estimated and final duties

    If a cash deposit or bond collected as security for 
estimated AD or countervailing duties pursuant to an 
affirmative preliminary or final LTFV or CVD determination is 
greater than the amount of duty assessed pursuant to an AD or 
CVD order, then the difference between the deposit and the 
amount of final duty will be refunded for entries prior to 
notice of the final injury determination. Sections 707 and 737 
of the Tariff Act of 1930, as amended, provide that if the cash 
deposit or bond is lower than the final duty under the order, 
then the difference is disregarded. No interest accrues in 
either case.\15\
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    \15\ With respect to AD determinations, section 40 of the Trade Law 
Technical Corrections and Miscellaneous Amendments Act of 1996 
clarifies that the cap on the amount of the AD duty applies not only to 
cash deposits but to bonds as well, making it consistent with the cap 
applied in CVD determinations.
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    If estimated AD or countervailing duties deposited for 
entries after notice of the final injury determination are 
greater than the amount of final AD or countervailing duties 
determined under an AD or CVD order, then the difference will 
be refunded, together with interest on the amount of 
overpayment. If estimated duties are less than the amount of 
final duties, then the difference will be collected together 
with interest on the amount of such underpayment.

Administrative review

    The DOC is required, upon request, to conduct an annual 
review of outstanding AD and CVD orders and suspension 
agreements. For all entries of merchandise subject to an AD 
review, the DOC must determine the normal value, export price, 
and the amount of dumping margin. For all entries of 
merchandise subject to a CVD review, the DOC must review and 
determine the amount of any net countervailable subsidy. These 
determinations will provide the basis for assessment of AD and 
countervailing duties on all entries subject to the review, and 
for deposits of estimated duties on entries subsequent to the 
period of review.
    The results of its annual review must be published together 
with a notice of any AD or countervailing duty to be assessed, 
estimated duty to be deposited, or investigation to be resumed. 
Under the Uruguay Round Agreements Act, time limits were added 
to the administrative review process so that final 
determinations are due in 1 year (with extensions up to an 
additional 6 months available).

Changed circumstances review

    Under the statute, a review of a final determination or of 
a suspension agreement is to be conducted by the DOC or ITC 
whenever it receives information or a request showing changed 
circumstances sufficient to warrant such review. Without good 
cause shown, however, no final determination or suspension 
agreement can be reviewed within 24 months of its notice. The 
party seeking revocation of an order has the burden of 
persuasion as to whether there are changed circumstances 
sufficient to warrant revocation.

Sunset review

    The Uruguay Round Agreements provide for the termination, 
or sunset, of AD and CVD orders and suspension agreements after 
5 years unless the authorities determine that such expiry would 
be likely to lead to the continuation or recurrence of dumping, 
subsidization or injury. Accordingly, section 220 of the 
Uruguay Round Agreements Act provides that orders may be 
revoked and suspension agreements terminated after 5 years if 
the terms are met. The DOC publishes a notice of initiation of 
a sunset review not later than 30 days before the fifth 
anniversary of the order. A party interested in maintaining the 
order must respond to the notice by providing information to 
the DOC and ITC concerning the likely effects of revocation. 
The DOC is to conclude its investigation within 240 days of 
initiation, and the ITC within 360 days of initiation. These 
deadlines may be extended if the investigation is 
extraordinarily complicated.
    In AD cases, the DOC is to determine whether revocation of 
an order or termination of a suspension agreement would be 
likely to lead to continuation or recurrence of dumping. In 
making this determination, the DOC is to consider the weighted 
average dumping margins determined in the investigation and 
subsequent reviews and the volume of imports of the subject 
merchandise for the period before and the period after the 
issuance of the order or acceptance of the suspension 
agreement. The DOC may consider other enumerated factors, upon 
good cause shown. In addition, the DOC is to provide to the ITC 
the magnitude of the margin of dumping that is likely to 
prevail if the order is revoked or the suspended investigation 
terminated.
    In CVD cases, the DOC is to determine whether revocation of 
an order or termination of a suspension agreement would be 
likely to lead to continuation or recurrence of a 
countervailable subsidy. In making this determination, the DOC 
is to consider the net countervailable subsidy determined in 
the investigation and subsequent reviews and whether any change 
in the program which gave rise to the net countervailable 
subsidy has occurred that is likely to be of effect. The DOC 
may consider other enumerated factors, upon good cause shown. 
In addition, the DOC is to provide to the ITC the amount of the 
net countervailable subsidy that is likely to prevail if the 
order is revoked or the suspended investigation terminated.
    In both AD and CVD cases, the ITC is to determine whether 
revocation would be likely to lead to the likelihood of 
continuation or recurrence of material injury within a 
reasonably foreseeable period of time. In making this 
determination, the ITC is to consider the likely volume, price 
effect, and impact of subject imports on the industry if the 
order is revoked or the suspension agreement terminated. The 
ITC is to take into account its prior injury determinations, 
whether any improvement in the state of the industry is related 
to the order or the suspension agreement, and whether the 
industry is vulnerable to material injury if the order is 
revoked or the suspension agreement terminated.
    In AD sunset reviews, the ITC may also consider the 
magnitude of the dumping margin. In CVD sunset reviews, the ITC 
may also consider the magnitude of the net countervailable 
subsidy. The nature of the countervailable subsidy as well as 
whether the subsidy is covered by article 3 (export subsidies 
or subsidies contingent on the use of domestic over imported 
goods) or article 6.1 (subsidies causing serious prejudice) of 
the Subsidies Agreement must be considered.
    The ITC may cumulatively assess the volume and effect of 
imports of the subject merchandise from all countries subject 
to sunset reviews if such imports are likely to compete with 
each other and with domestic like products in the U.S. market. 
However, the ITC is not to cumulate imports a country if those 
imports are not likely to have a discernible adverse impact on 
the domestic industry.
    In addition, the new provision specifies that 2 years after 
the issuance of an order in which the subject merchandise is 
sold in the United States by an importer related to the 
exporter, and where the DOC determines that there is a 
reasonable basis to believe or suspect that duty absorption is 
occurring, the DOC is to examine in AD reviews whether duties 
have been absorbed by a foreign producer or exporter subject to 
the order. The ITC is to take such findings into account in its 
sunset injury review. The SAA accompanying the bill provides, 
however, that the provision is not to apply as a duty as cost 
provision, in which AD duties are deducted from export price if 
the related importer is being reimbursed for duties by the 
manufacturer, effectively doubling AD duties.\16\
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    \16\ Uruguay Round Agreements Act Statement of Administrative 
Action at 885.
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    Section 220 of the Uruguay Round Agreements Act provides 
that orders already in effect as of the January 1, 1995 date of 
implementation be deemed as issued on that date. Pursuant to 
the schedule laid out in section 220 for the review of 
transition orders, DOC began its review 18 months prior to 
their fifth anniversary date (July 1, 1998). Section 220 
provides that individual reviews shall be completed within 18 
months of initiation, and that the review of all transition 
orders shall be completed not later than 18 months after the 
fifth anniversary of the date such orders were issued (July 1, 
2001).

Expedited reviews with security in lieu of deposits

    In AD cases only, the DOC may permit, for not more than 90 
days after publication of an order, the posting of a bond or 
other security in lieu of the deposit of estimated AD duties if 
certain conditions exist. The DOC must be satisfied that it 
will be able to determine, within such 90-day period, the 
normal value and the export price for all merchandise entered 
on or after an affirmative LTFV determination (either 
preliminary or final, whichever is the first affirmative 
determination) and before publication of an affirmative final 
injury determination. Also, in order for the DOC to undertake 
this expedited review, the preliminary determination in the 
investigation must not have been extended because the case was 
``extraordinarily complicated,'' the final determination must 
not have been extended, the DOC must receive information 
indicating that the revised margin would be significantly less 
than the dumping margin specified in the AD order, and there 
must be adequate sales to the United States since the 
preliminary (or final) determination to form a basis for 
comparison. The determination of such new dumping margin will 
then provide the basis for assessment of AD duties on the 
entries for which the posting of bond or other security has 
been permitted, and will also provide the basis for deposits of 
estimated AD duties on future entries.

Anticircumvention authority

    In 1988, specific authority was added to U.S. law to 
authorize the DOC to take action to prevent or address attempts 
to circumvent an outstanding AD or CVD order. The authority 
addresses four particular types of circumvention: assembly of 
merchandise in the United States, assembly of merchandise in a 
third country, minor alterations of merchandise, and later-
developed merchandise. Under certain circumstances and after 
considering certain specified factors, the DOC may extend the 
scope of the AD or CVD order to include parts and components 
(in cases involving U.S. assembly), third country merchandise 
(in cases involving third country assembly), altered 
merchandise, or later-developed merchandise.
    As part of the Uruguay Round negotiations on AD, the United 
States sought the inclusion of an anticircumvention provision 
in the Antidumping Agreement. The negotiators, however, were 
unable to agree on a text concerning anticircumvention and 
referred the matter to the Committee on Antidumping Practices 
for resolution. Accordingly, the Agreement is silent concerning 
anticircumvention authority.
    The Uruguay Round Agreements Act modified the 
anticircumvention provision of the 1988 Act to focus on the 
nature of the assembly operation in the United States or third 
country as well as on whether the parts and components from the 
country subject to the order are a ``significant portion'' of 
the total value of the merchandise assembled in the United 
States or third country.

Best information available

    In order to promote transparency, the Uruguay Round 
signatories agreed to detailed guidelines concerning the use of 
``best information available'' (BIA). In seeking to implement 
those guidelines, the Uruguay Round Agreements Act preserves 
the ability of the agencies to rely on adverse inferences upon 
a finding that the party has failed to cooperate by not acting 
to the best of its ability to comply with a request. At the 
same time, however, the new law also contains limitations on 
the use of BIA, many of which are designed to assist small 
companies in providing information. For example, the agency is 
to consider the ability of an interested party to provide the 
information in the requested form and manner, and may modify 
the requirements upon a reasoned and timely explanation by that 
party. In addition, if the agency determines that a response 
does not comply with the request, the agency must, to the 
extent practicable, provide an opportunity to remedy the 
deficiency.
    The Agreements provide that the authorities are not 
justified in disregarding less than ideal information if the 
party acted to the best of its ability. Section 231 of the 
Uruguay Round Agreements Act provides that the agencies are not 
to decline to consider information that is timely submitted, 
verifiable, and not so incomplete that it cannot serve as a 
reliable basis for the determination, if the submitting party 
acted to the best of its ability to meet the requirements, and 
if the information can be used without undue difficulties.
    The Act further provides that if an agency relies on 
secondary information rather than on information submitted by a 
respondent, it must, to the extent practicable, corroborate 
that information from independent sources reasonably at its 
disposal.

Continued Dumping and Subsidy Offset Act

    Title X of the Agriculture and Related Agencies 
Appropriations Act for Fiscal Year 2001 contained the Continued 
Dumping and Subsidy Offset Act of 2000,\17\ commonly referred 
to as the Byrd Amendment, which provides for the annual 
distribution of AD and countervailing duties assessed pursuant 
to a CVD order, an AD order, or a finding under the Antidumping 
Act of 1921 to the affected domestic producers for qualifying 
expenditures. The provision amends title VII of the Tariff Act 
of 1930 by inserting a new section 754. The amendments made by 
the new section apply to all AD and CVD assessments made on or 
after October 1, 2000 with respect to orders in effect from 
January 1, 1999.
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    \17\ Public Law 106-387, approved October 28, 2000, 19 U.S.C. 754.
---------------------------------------------------------------------------
    Under the new section 754, the term ``affected domestic 
producer'' is defined as a manufacturer, producer, farmer, 
rancher, or worker representative (including associations of 
such persons) that: (1) was a petitioner or interested party in 
support of the petition with respect to which an AD order, a 
finding under the Antidumping Act of 1921, or a CVD order has 
been entered; and (2) remains in operation. Companies, 
businesses, or persons that have ceased the production of the 
product covered by the order or finding, or who have been 
acquired by a company or business that is related to a company 
that opposed the investigation, shall not be considered an 
``affected domestic producer.''
    Section 754(d)(1) requires the ITC to forward a list to the 
Commissioner of the U.S. Customs Service of petitioners and 
persons with respect to each order or finding, and a list of 
persons that indicated support of a petition by letter or 
through questionnaire response. The ITC was required to submit 
its list related to orders and findings in effect on January 1, 
1999 within 60 days of the date of enactment of the section 
(i.e., by December 29, 2000). Thereafter, the ITC is to submit 
lists to the Commissioner of Customs within 60 days after the 
date an AD or CVD order or finding is issued. In those cases 
where an injury determination was not required or the ITC's 
records do not permit identification of petition supporters, 
the ITC is to consult with the DOC to determine the identity of 
the petitioner and those domestic parties who have entered 
appearances during administrative reviews.
    The Commissioner of Customs is responsible in section 
754(c) for prescribing procedures for the annual distribution 
of the AD and countervailing duties assessed. Distribution is 
to be made not later than 60 days after the first day of a 
fiscal year from duties assessed during the preceding fiscal 
year. At least 30 days prior to a distribution, the 
Commissioner is required to publish in the Federal Register a 
notice of intention to distribute and the list of affected 
domestic producers potentially eligible for the distribution 
based on the list obtained from the ITC. The Commissioner is to 
request certifications from each potentially eligible affected 
domestic producer indicating: (1) that the producer desires to 
receive a distribution; (2) that the producer is eligible to 
receive the distribution as an affected domestic producer; and 
(3) the qualifying expenditures incurred by the producer since 
the issuance of the order or finding for which distribution has 
not previously been made.
    The Commissioner distributes all funds (including all 
interest earned on the funds) from assessed duties received in 
the preceding fiscal year to affected domestic industries based 
on the certifications received. The distributions are to be 
made on a pro rata basis based on new and remaining qualifying 
expenditures. A ``qualifying expenditure'' is defined as an 
expenditure incurred after the issuance of the AD finding or 
order or CVD order in any of the following categories: (1) 
manufacturing facilities; (2) equipment; (3) research and 
development; (4) personnel training; (5) acquisition of 
technology; (6) health care benefits to employees paid for by 
the employer; (7) pension benefits to employees paid by the 
employer; (8) environmental equipment, training, or technology; 
(9) acquisition of raw materials and other inputs; and (10) 
working capital or other funds needed to maintain production.
    For each order or finding in effect on the date of 
enactment of the section, the Commissioner of Customs was 
required to establish a special account in the U.S. Treasury 
within 14 days. Thereafter, the Commissioner is to establish a 
special account in the U.S. Treasury with respect to each order 
or finding within 14 days after the date of that an AD order or 
finding or CVD order takes effect. The Commissioner is 
responsible for depositing all AD or countervailing duties 
(including interest earned on such duties) that are assessed 
after the effective date of this section into the special 
account appropriate for each AD order or finding or CVD order.
    The Commissioner is to prescribe the time and manner in 
which distribution of the funds in a special account shall be 
made.
    A special account is to terminate after: (1) the order or 
finding with respect to which the account was established has 
terminated; (2) all entries relating to the order or finding 
are liquidated and duties assessed collected; (3) the 
Commissioner has provided notice and a final opportunity to 
obtain distribution; and (4) 90 days has elapsed from the date 
of notice and final opportunity to obtain distribution.
    On December 21, 2000, Australia, Brazil, Chile, the 
European Union (EU), India, Indonesia, Japan, Korea, and 
Thailand requested consultations with the United States in the 
World Trade Organization (WTO) regarding the Continued Dumping 
and Subsidy Offset Act of 2000. Canada and Mexico requested to 
join the WTO consultations previously requested on January 16, 
2001 and January 22, 2001 respectively.

Judicial review

    An interested party dissatisfied with a final AD or CVD 
determination or review may file an action in the U.S. Court of 
International Trade (CIT) for judicial review. To obtain 
judicial review of the administrative action, a summons and 
complaint must be filed concurrently within 30 days of 
publication of the final determination. As set forth in section 
516A of the Tariff Act of 1930, as amended, the standard of 
review used by the Court is whether the determination is 
supported by ``substantial evidence on the record'' or 
``otherwise not in accordance with law.'' Appeal of negative 
preliminary determinations is based on whether the 
determination is ``arbitrary, capricious, an abuse of 
discretion, or [is] otherwise not in accordance with law.''
    Judicial review of interlocutory decisions, previously 
permitted, was eliminated by section 623 of the Trade and 
Tariff Act of 1984. Decisions of the CIT are subject to appeal 
to the U.S. Court of Appeals for the Federal Circuit.
    As a result of provisions in the North American Free Trade 
Agreement (NAFTA) and its implementing legislation, final 
determinations in AD or CVD proceedings involving products of 
Canada and Mexico are reviewed by a NAFTA panel instead of by 
the CIT, if either the United States, Canadian or Mexican 
government so requests. The panel will apply U.S. law and U.S. 
standards of judicial review to decide whether U.S. law was 
applied correctly by the DOC and the ITC.

WTO panel review

    As part of the Uruguay Round Agreements, the parties agreed 
to a strengthened dispute resolution process under the World 
Trade Organization (WTO), in which parties are permitted to 
bring their disputes to a review body for resolution. The 
Uruguay Round Agreements Act contains provisions relating to 
the adoption of panel reports in AD and CVD cases.
    Section 129 of the Uruguay Round Agreements Act provides 
that if a dispute settlement panel or appellate body finds that 
an action by the ITC is not in conformity with U.S. 
obligations, USTR may request that the ITC issue an advisory 
report on whether the statute permits it to take steps that 
would render its determination not inconsistent with those 
findings. If the ITC issues an affirmative report, USTR may 
request that it issue a determination not inconsistent with the 
findings of the panel or appellate body. If, by virtue of that 
determination, an AD or CVD order is no longer supported by an 
affirmative determination, USTR, after consultation with 
Congress, may direct the ITC to revoke the order. However, the 
President may, again after consultation with Congress, reduce, 
modify, or terminate the agency action.
    If a dispute settlement panel or appellate body finds that 
an action by the DOC is not in conformity with U.S. 
obligations, USTR may request that the DOC issue a 
determination that would render its determination not 
inconsistent with those findings, after consultation with 
Congress. USTR may further request that the DOC implement that 
determination.
    Any ITC and DOC action implemented as a result of dispute 
settlement is to apply to liquidated entries of the subject 
merchandise entered on or after the date on which USTR directs 
the ITC to revoke an order or the DOC to implement a 
determination.
WTO panel determinations
    In 1997, the Republic of Korea challenged the DOC's AD 
review of dynamic random access memory (DRAM) semiconductors 
from Korea, alleging that the DOC's decision not to revoke the 
AD order was inconsistent with the Antidumping Agreement and 
GATT 1994. A WTO panel was established on January 16, 1998. The 
panel ruled in favor of Korea on January 29, 1999. While the 
panel rejected almost all of Korea's claims, if found that the 
``not likely'' standard in the DOC's regulations did not meet 
the requirements of Article 11.2 of the Antidumping Agreement. 
Neither side appealed the decision. On April 15, 1999, the 
United States indicated its intention to comply with the panel 
decision. The DOC amended its regulations and made a 
redetermination under the revised regulations to retain the AD 
order on DRAMs from Korea. Korea challenged U.S. compliance 
with the panel decision and on April 6, 2000 requested that the 
panel be reconvened to examine U.S. implementation. The parties 
then reached a mutually satisfactory solution regarding this 
matter, and Korea withdrew its request on October 20, 2000. 
Specifically, the DOC agreed to terminate the AD order on 
January 1, 2000 in exchange for Korea's agreement to collect 
cost and price data on DRAMs of one megabit and above. This 
information will be made available to the DOC within 14 days 
after the filing of a new AD case.
    The Foreign Sales Corporation (FSC) provisions of the U.S. 
tax code (sections 921-927 of the Internal Revenue Code) 
provide exporters with a partial tax exemption on certain 
foreign income of FSCs, which are foreign subsidiaries of U.S. 
companies. The EU challenged these provisions, claiming that 
these rules constituted prohibited export subsidies and import 
substitution subsidies under the Subsidies Agreement, and that 
they violated the export subsidy provisions of the Agreement on 
Agriculture. A WTO panel was established on September 22, 1998. 
The panel found in favor of the EU on October 8, 1999 on U.S. 
violations of the Subsidies Agreement and the Agreement on 
Agriculture. In the panel's view, in the case of a tax measure, 
a subsidy exists if ``but for'' the measure, a firm's tax 
liability would be increased and the existence of the subsidy 
results in revenue foregone to the government. Applying this 
standard to the FSC provisions, the panel concluded that those 
provisions constituted a subsidy. Moreover, the panel found the 
subsidy to be ``contingent on export performance.'' On February 
24, 2000, the Appellate Body upheld the panel's findings on 
U.S. violations of the Subsidies Agreement, but reversed the 
panel's findings regarding the Agreement on Agriculture. The 
panel and Appellate Body reports were adopted on March 20, 
2000, and on April 7, 2000, the United States announced its 
intention to come into compliance with its WTO obligations. The 
United States amended the FSC provisions of the U.S. tax code 
to address the panel report in Public Law 106-519, approved 
November 15, 2000. On December 7, 2000, the EU filed a request 
for establishment of a panel to review the legislation, and the 
panel was established on December 20, 2000.
    Title VII of the Revenue Act of 1916, commonly referred to 
as the Antidumping Act of 1916, establishes a civil cause of 
action in federal court for private damages as well as criminal 
penalties against parties who dump foreign merchandise in the 
United States. The EU challenged this provision of U.S. law, 
claiming that the statute violates U.S. obligations under the 
Antidumping Agreement and GATT 1994. A WTO panel was formed on 
January 29, 1999. The panel ruled in favor of the EU on March 
31, 2000. Separately, Japan sought its own rulings on the same 
matter from the same panelists; that report was circulated on 
May 29, 2000. The panel found that the 1916 Act is inconsistent 
with WTO rules because the specific intent requirement of the 
Act does not satisfy the material injury test required by the 
Antidumping Agreement. The panel also found that the civil and 
criminal penalties in the 1916 Act go beyond the provisions of 
the Antidumping Agreement. The Appellate Body proceedings on 
both cases were consolidated into one, and on August 28, 2000 
the Appellate Body affirmed the panel reports. The United 
States is in arbitration on a compliance schedule and is 
seeking a deadline of 15 months from the Appellate Body 
decision (November 2001).
    The EU challenged the imposition of countervailing duties 
on certain hot-rolled lead and bismuth carbon steel (lead bar) 
from the United Kingdom, contending that the DOC had imposed 
countervailing duties on two private successor companies of 
government-owned British Steel Corporation (BSC) based on a 
methodology that attributed a portion of the massive subsidies 
originally received by BSC to the two successor companies. The 
EU alleged violations of Articles 1.1(b), 10, 14, and 19.4 of 
the Subsidies Agreement. A WTO panel was established on 
February 17, 1999. Brazil and Mexico both intervened as third 
parties. The panel ruled in favor of the EU on December 23, 
1999. In reaching its decision, the panel disagreed with how 
the DOC accounts for the privatization of a government-owned 
company and insisted that an investigating authority (such as 
the DOC) must re-measure the benefit of pre-privatization 
subsidies based on circumstances at the time of the 
privatization. Specifically, in order to impose countervailing 
duties, the investigating authority must demonstrate that the 
producer or exporter of the particular imports continues to 
enjoy the benefit of a subsidy (i.e., as in a competitive 
advantage) at the time of the production or exportation of 
those goods. The panel further explained that the successor 
privatized company should not be considered as having realized 
any benefit from pre-privatization subsidies if fair market 
value was paid for the government-owned company. In the case of 
BSC, the panel found that none of the benefit from the pre-
privatization subsidies would be attributed to the two 
successor, privatized companies. The CVD order in question was 
revoked on January 1, 2000 under the DOC's ``sunset review'' 
procedures. On November 13, 2000, the EU requested 
consultations with the United States on 14 similar CVD cases in 
which the United States imposed duties on privatized European 
companies on the basis that the previous subsidies they had 
received had been passed through to the new owners. 
Consultations were held with the EU on December 7, 2000. On 
December 21, 2000, Brazil requested similar consultations with 
the United States.

   Enforcement of U.S. Rights Under Trade Agreements and Response to 
 Certain Foreign Practices: Sections 301-310 of the Trade Act of 1974, 
                               as amended

    Chapter 1 of title III (sections 301-310) of the Trade Act 
of 1974, as amended,\18\ provides the authority and procedures 
to enforce U.S. rights under international trade agreements and 
to respond to certain unfair foreign practices. The predecessor 
statute, section 252 of the Trade Expansion Act of 1962,\19\ 
was repealed and section 301 established in its place under the 
Trade Act of 1974. Section 301 was amended under title IX of 
the Trade Agreements Act of 1979 \20\ in two principal 
respects: (1) to include specific authority to enforce U.S. 
rights and to respond to actions by foreign countries 
inconsistent with or otherwise denying U.S. benefits under 
trade agreements; and (2) to place specific time limits on the 
procedures for investigating and taking action on petitions. 
Some further amendments were enacted under sections 304 and 
307(b) of the Trade and Tariff Act of 1984 \21\ to clarify 
certain authorities and practices covered by section 301, and 
to authorize certain actions with respect to foreign export 
performance requirements.
---------------------------------------------------------------------------
    \18\ Public Law 93-618, approved January 3, 1975, 19 U.S.C. 2411.
    \19\ Public Law 87-794, section 252, approved October 11, 1962.
    \20\ Public Law 96-39, title IX, approved July 26, 1979.
    \21\ Public Law 98-573, approved October 30, 1984.
---------------------------------------------------------------------------
    The current statute reflects major modifications made by 
sections 1301-1303 of the Omnibus Trade and Competitiveness Act 
of 1988 \22\ to what is commonly called ``section 301,'' as 
well as enactment of additional authorities commonly known as 
``Super 301'' \23\ to deal with priority practices and priority 
countries and ``Special 301'' to deal with priority 
intellectual property rights (IPR) practices. The principal 
amendments in 1988 to strengthen the basic section 301 
authority were: (1) to require the U.S. Trade Representative 
(USTR) to make unfair trade practice determinations in all 
cases, and to transfer authority to determine and implement 
section 301 action from the President to the USTR, subject to 
the specific direction, if any, of the President; (2) to make 
section 301 action mandatory in cases of trade agreement 
violations or other ``unjustifiable'' practices, except in 
certain circumstances; (3) to include additional types of 
practices as specifically actionable under section 301; (4) to 
tighten and specify time limits on all investigations and 
actions; and (5) to require monitoring and enforcement of 
foreign settlement agreements and to provide for modification 
and termination of section 301 actions.
---------------------------------------------------------------------------
    \22\ Public Law 100-418, approved August 23, 1988.
    \23\ The Statutory authority for Super 301 expired in 1990. Since 
then, the President has chosen to renew Super 301 authorities three 
times by Executive Order. On March 31, 1999, the President issued 
Executive Order 13116 (64 Fed. Reg. 16333), which renewed Super 301 
authorities through 2001.
---------------------------------------------------------------------------
    Further modifications were made by the Uruguay Round 
Agreements Act \24\ to sections 301-310 and 182 of the Trade 
Act of 1974 to conform to the time limits under the WTO 
Understanding on Rules and Procedures Governing the Settlement 
of Disputes (Dispute Settlement Understanding) and to clarify 
and strengthen the scope and application of these domestic 
authorities.
---------------------------------------------------------------------------
    \24\ Public Law 103-465, approved December 8, 1993.
---------------------------------------------------------------------------

           International Consultations and Dispute Settlement

    Article XII and XIII of the General Agreement on Tariffs 
and Trade (GATT), as elaborated upon by the Texts Concerning a 
Framework for the Conduct of World Trade concluded in the Tokyo 
Round of multilateral trade negotiations (MTN),\25\ provided 
the general consultation and dispute settlement procedures 
applicable to GATT rights and obligations. In addition, the 
GATT agreements concluded in the MTN on specific non-tariff 
barriers each contained procedures for consultation and 
resolution of disputes among signatories concerning practices 
covered by each agreement.
---------------------------------------------------------------------------
    \25\ MTN/FR/W/20/Rev. 2, reprinted in House Doc. No. 96-153, pt. I 
at 619.
---------------------------------------------------------------------------
    As part of the Uruguay Round, the parties agreed to the 
Understanding on Rules and Procedures Governing the Settlement 
of Disputes which establishes a single, integrated Dispute 
Settlement Body dealing with disputes arising under any of the 
WTO agreements. One of the most marked changes in this new 
dispute resolution mechanism is that all of the key decisions 
in the dispute settlement process, including the establishment 
of panels, adoption of panel and Appellate Body reports, and 
the authorization to retaliate will be automatic unless there 
is a unanimous vote against the action. Accordingly, parties 
may no longer block panel reports adverse to them. In addition, 
timetables are established for each phase of the dispute 
resolution process. Moreover, an Appellate Body is established 
to examine issues of law covered in a panel report and legal 
interpretations developed by the panel. Retaliation, in the 
form of suspended concessions or obligations, is to be limited 
to the sector that is at issue in the proceeding, unless it is 
not practicable or effective. Issues related to the level of 
retaliation may be submitted to binding arbitration.
     In 1998, the European Union (EU) initiated a dispute 
settlement case against the United States challenging the WTO 
consistency of section 301. Specifically, the EU claimed that 
section 301 violated the Dispute Settlement Understanding (DSU) 
because certain statutory deadlines could require the USTR to 
take action before WTO panel proceedings were finished. The EU 
complaint was not based on U.S. actions in a particular section 
301 case.
    On December 22, 1999, a WTO panel rejected the EU's 
complaint. The panel found that section 301 provides the USTR 
with adequate discretion to comply with the DSU rules in all 
cases, and that the USTR had in fact exercised that discretion 
in accordance with U.S. WTO obligations in every section 301 
determination involving an alleged violation of U.S. WTO 
rights. The EU did not appeal the panel decision. The decision 
was adopted by the WTO Dispute Settlement Body on January 27, 
2000.

Carousel Retaliation

    Section 407 of the Trade and Development Act of 2000 (P.L. 
106-200) addresses effective operation of the WTO dispute 
settlement mechanism and lack of compliance with WTO panel 
decisions, particularly in cases brought by the United States 
in disputes with the EU involving bananas and beef. Section 407 
amended sections 301-310 of the Trade Act of 1974 to require 
the USTR to make periodic revisions of retaliation lists 120 
days from the date the retaliation list is made and every 180 
days thereafter. The purpose of this provision is to facilitate 
efforts by the USTR to enforce rights of the United States if 
another WTO member fails to comply with the results of a 
dispute settlement proceeding.

           Enforcement Authority and Procedures (Section 301)

    Sections 301-309 of the Trade Act of 1974, as amended, 
provide the domestic counterpart to the WTO consultation and 
dispute settlement procedures. They contain the authority under 
U.S. domestic law to take retaliatory action, including import 
restrictions if necessary, to enforce U.S. rights against 
violations of trade agreements by foreign countries and 
unjustifiable, unreasonable, or discriminatory foreign trade 
practices which burden or restrict U.S. commerce. Section 301 
authority applies to practices and policies of countries 
whether or not the measures are covered by, or the countries 
are members of, GATT/WTO or other trade agreements. The USTR 
administers the statutory procedures through an interagency 
committee.

Basis and form of authority

    Under section 301, if the USTR determines that a foreign 
act, policy, or practice violates or is inconsistent with a 
trade agreement, or is unjustifiable and burdens or restricts 
U.S. commerce, then action by the USTR to enforce the trade 
agreement rights or to obtain the elimination of the act, 
policy, or practice is mandatory, subject to the specific 
direction, if any, of the President. The USTR is not required 
to act, however, if (1) a WTO/GATT panel has reported, or a 
dispute settlement ruling under a trade agreement finds, that 
U.S. trade agreement rights have not been denied or violated; 
(2) the USTR finds that the foreign country is taking 
satisfactory measures to grant U.S. trade agreement rights, has 
agreed to eliminate or phase out the practice or to an imminent 
solution to the burden or restriction on U.S. commerce, or has 
agreed to provide satisfactory compensatory trade benefits; or 
(3) the USTR finds, in extraordinary cases, that action would 
have an adverse impact on the U.S. economy substantially out of 
proportion to the benefits of action, or finds that action 
would cause serious harm to the U.S. national security. Any 
action taken must affect goods or services of the foreign 
country in an amount equivalent in value to the burden or 
restriction being imposed by that country on U.S. commerce.
    If the USTR determines that the act, policy, or practice is 
unreasonable or discriminatory and burdens or restricts U.S. 
commerce and action by the United States is appropriate, then 
the USTR has discretionary authority to take all appropriate 
and feasible action, subject to the specific direction, if any, 
of the President, to obtain the elimination of the act, policy, 
or practice.
    With respect to the form of action, the USTR is authorized 
to (1) suspend, withdraw, or prevent the application of 
benefits of trade agreement concessions to carry out a trade 
agreement with the foreign country involved; (2) impose duties 
or other import restrictions on the goods of, and 
notwithstanding any other provision of law, fees or 
restrictions on the services of, the foreign country for such 
time as the USTR deems appropriate; (3) withdraw or suspend 
perferential duty treatment under the Generalized System of 
Preferences (GSP), the Carribean Basin Initiative, or the 
Andean Trade Preferences Act; or (4) enter into binding 
agreements that commit the foreign country to (a) eliminate or 
phase out the act, policy, or practice, (b) eliminate any 
burden or restriction on U.S. commerce resulting from the act, 
policy, or practice, or (c) provide the United States with 
compensatory trade benefits that are satisfactory to the USTR. 
The USTR may also take all other appropriate and feasible 
action within the power of the President that the President may 
direct the USTR to take.
    With respect to services, the USTR may also restrict the 
terms and conditions or deny the issuance of any access 
authorization (e.g., license, permit, order) to the U.S. market 
issued under federal law, notwithstanding any other law 
governing the authorization. Such action can apply only 
prospectively to authorizations granted or applications pending 
on or after the date a section 301 petition is filed or the 
USTR initiates an investigation. Before imposing fees or other 
restrictions on services subject to federal or state 
regulation, the USTR must consult as appropriate with the 
federal or state agency concerned.
    Under section 301, action may be taken on a non-
discriminatory basis or solely against the products or services 
of the country involved and with respect to any goods or sector 
regardless of whether they were involved in the particular act, 
policy, or practice. The statute does not require that action 
taken under section 301 be consistent with U.S. obligations 
under international agreements, but the dispute-settlement 
provisions of such agreement could be utilized.
    If the USTR determines that action is to be in the form of 
import restrictions, it must give preference to tariffs over 
other forms of import restrictions and consider substituting on 
an incremental basis an equivalent duty for any other form of 
import restriction imposed. Any action with respect to export 
targeting must reflect, to the extent possible, the full 
benefit level of the targeting over the period during which the 
action taken has an effect.

Coverage of authority

    The term ``unjustifiable'' refers to acts, policies, or 
practices which violate or are inconsistent with U.S. 
international legal rights, such as denial of national or 
normal trade relations (NTR) treatment, right of establishment, 
or protection of intellectual property rights.
    The term ``unreasonable'' refers to acts, policies, or 
practices which are not necessarily in violation of or 
inconsistent with U.S. international legal rights, but are 
otherwise unfair and inequitable. In determining whether an 
act, policy, or practice is unreasonable, reciprocal 
opportunities in the United States for foreign nationals and 
firms must be taken into account, to the extent appropriate. 
Unreasonable measures include, but are not limited to, acts, 
policies, or practices which (1) deny fair and equitable (a) 
opportunities for the establishment of an enterprise, (b) 
provision of adequate and effective IPR protection, 
notwithstanding the fact that the foreign country may be in 
compliance with the specific obligations of the Agreement on 
Trade-Related Aspects of Intellectual Property Rights (TRIPs), 
(c) non-discriminatory market access opportunities for U.S. 
persons that rely upon intellectual property (IP) protection, 
or (d) market opportunities, including foreign government 
toleration of systematic anticompetitive activities by or among 
enterprises in the foreign country that have the effect of 
restricting, on a basis inconsistent with commercial 
considerations, access of U.S. goods or services to a foreign 
market; (2) constitute export targeting; or (3) constitute a 
persistent pattern of conduct denying internationally-
recognized worker rights, unless the USTR determines the 
foreign country has taken or is taking actions that demonstrate 
a significant and tangible overall advancement in providing 
those rights and standards throughout the country or such acts, 
policies, or practices are not inconsistent with the level of 
economic development of the country.
    The term ``export targeting'' refers to any government plan 
or scheme consisting of a combination of coordinated actions 
bestowed on a specific enterprise, industry, or group thereof, 
which has the effect of assisting that entity to become more 
competitive in the export of a class or kind of merchandise.
    The term ``discriminatory'' includes, where appropriate, 
any act, policy, or practice which denies national or NTR 
treatment to U.S. goods, services, or investment.
    The term ``commerce'' includes, but is not limited to, 
services (including transfers of information) associated with 
international trade, whether or not such services are related 
to specific goods, and foreign direct investment by U.S. 
persons with implications for trade in goods or services.

Petitions and investigations

    Any interested person may file a petition under section 302 
with the USTR requesting that action be taken under section 301 
and setting forth the allegations in support of the request. 
The USTR reviews the allegations and must determine within 45 
days after receipt of the petition whether to initiate an 
investigation. The USTR may also self-initiate an investigation 
after consulting with appropriate private sector advisory 
committees. Public notice of determinations is required, and in 
the case of decisions to initiate, publication of a summary of 
the petition and an opportunity for the presentation of views, 
including a public hearing if timely requested by the 
petitioner or any interested person.
    In determining whether to initiate an investigation of any 
act, policy, or practice specifically enumerated as actionable 
under section 301, the USTR has the discretion to determine 
whether action under section 301 would be effective in 
addressing that act, policy, or practice.
    Section 303 requires the use of international procedures 
for resolving the issues to proceed in parallel with the 
domestic investigation. The USTR must, on the same day as the 
determination is made, initiate an investigation and request 
consultations with the foreign country concerned regarding the 
issues involved. The USTR may delay the request for up to 90 
days in order to verify or improve the petition to ensure an 
adequate basis for consultation.
    If the issues are covered by a trade agreement and are not 
resolved during the consultation period, if any, specified in 
the agreement, then the USTR must promptly request formal 
dispute settlement under the agreement before the earlier of 
the close of that consultation period or 150 days after the 
consultations began. The USTR must seek information and advice 
from the petitioner, if any, and from appropriate private 
sector advisory committees in preparing presentations for 
consultations and dispute settlement proceedings.

USTR unfairness and action determinations and implementation

    Section 304 sets forth specific time limits within which 
the USTR must make determinations of whether an act, policy, or 
practice meets the unfairness criteria of section 301 and, if 
affirmative, what action, if any, should be taken. These 
determinations are based on the investigation under section 302 
and, if a trade agreement is involved, on the international 
consultations and, if applicable, on the results of the dispute 
settlement proceedings under the agreement.
    The USTR must make these determinations:
          (1) within 18 months after the date the investigation 
        is initiated or 30 days after the date the dispute 
        settlement procedure is concluded, whichever is 
        earlier, in all cases involving a trade agreement;
          (2) within 12 months after the date the investigation 
        is initiated in cases not involving trade agreements; 
        or
          (3) within 6 months after the date the investigation 
        is initiated in cases involving IPR priority countries 
        if the USTR does not consider that a trade agreement, 
        including TRIPs, is involved, or within 9 months if the 
        USTR determines such cases (1) involve complex or 
        complicated issues that require additional time, (2) 
        the foreign country is making substantial progress on 
        legislative or administrative measures that will 
        provide adequate and effective protection, or (3) the 
        foreign country is undertaking enforcement measures to 
        provide adequate and effective protection.
The applicable deadline is postponed by up to 90 days if 
consultations with the foreign country involved were so 
delayed.
    Before making the determinations, the USTR must provide an 
opportunity for the presentation of views, including a public 
hearing if requested by an interested person, and obtain advice 
from the appropriate private sector advisory committees. If 
expeditious action is required, the USTR must comply with these 
requirements after making the determinations. The USTR may also 
request the views of the International Trade Commission on the 
probable impact on the U.S. economy of taking the action. Any 
determinations must be published in the Federal Register.
    Section 305 requires the USTR to implement any section 301 
actions within 30 days after the date of the determination to 
take action. The USTR may delay implementation by not more than 
180 days if (1) the petitioner or, in the case of a self-
initiated investigation, a majority of the domestic industry, 
requests a delay; or (2) the USTR determines that substantial 
progress is being made, or that a delay is necessary or 
desirable to obtain U.S. rights or a satisfactory solution. In 
cases involving IPR priority countries (see discussion below), 
implementation of actions may be delayed by not more than 90 
days beyond the 30 days and only if extraordinary circumstances 
apply.
    If the USTR determines to take no action in a case 
involving an affirmative determination of export targeting, the 
USTR must take alternative action in the form of establishing 
an advisory panel to recommend measures to promote the 
competitiveness of the affected domestic industry. The panel 
must submit a report on its recommendations to the USTR and the 
Congress within 6 months. On the basis of this report and 
subject to the specific direction, if any, of the President, 
the USTR may take administrative actions authorized under any 
other law and propose legislation to implement any other 
actions that would restore or improve the international 
competitiveness of the domestic industry. USTR must submit a 
report to the Congress within 30 days after the panel report is 
submitted on the actions taken and proposals made.

Monitoring of foreign compliance; modification and termination of 
        actions

    Section 306 requires the USTR to monitor the implementation 
of each measure undertaken or settlement agreement entered into 
by a foreign country under section 301. If the USTR considers 
that a foreign country is not satisfactorily implementing a 
measure or agreement, the USTR must determine what further 
action will be taken under section 301. Such foreign non-
compliance is treated as a violation of a trade agreement 
subject to mandatory section 301 action, subject to the same 
time limits and procedures for implementation as other action 
determinations. If the USTR considers that the foreign country 
has failed to implement a recommendation made pursuant to 
dispute settlement proceedings under the WTO, the USTR must 
make this determination no later than 30 days after the 
expiration of the reasonable period of time provided for such 
implementation in the DSU. Before making the determination on 
further action, the USTR must consult with the petitioner, if 
any, and with representatives of the domestic industry 
concerned, and provide interested persons an opportunity to 
present views.
    Section 307 authorizes the USTR to modify or terminate a 
section 301 action, subject to the specific direction, if any, 
of the President, if (1) any of the exceptions to mandatory 
section 301 action in the case of trade agreement violations or 
unjustifiable acts, policies, or practices applies; (2) the 
burden or restriction on U.S. commerce of the unfair practice 
has increased or decreased; or (3) discretionary section 301 
action is no longer appropriate. Before modifying or 
terminating any section 301 action, the USTR must consult with 
the petitioner, if any, and with representatives of the 
domestic industry concerned, and provide an opportunity for 
other interested persons to present views.
    Any section 301 action terminates automatically if it has 
been in effect for 4 years and neither the petitioner nor any 
representative of the domestic industry which benefits from the 
action has submitted to the USTR in the final 60 days of that 
4-year period a written request for continuation. The USTR must 
give the petitioner and representatives of the domestic 
industry at least 60 days advance notice by mail of 
termination. If a request for continuation is submitted, the 
USTR must conduct a review of the effectiveness of section 301 
or other actions in achieving the objectives and the effects of 
actions on the U.S. economy, including consumers.

Information requests; reporting requirements

    Under section 308, the USTR is to make available 
information (other than confidential) upon receipt of a written 
request by any person concerning (1) the nature and extent of a 
specific trade policy or practice of a foreign country with 
respect to particular goods, services, investment, or IPR to 
the extent such information is available in the federal 
government; (2) U.S. rights under any trade agreement and the 
remedies which may be available under that agreement and U.S. 
laws; and (3) past and present domestic and international 
proceedings or actions with respect to the policy or practice. 
If the information is not available, within 30 days after 
receipt of the request, the USTR must request the information 
from the foreign government or decline to request the 
information and inform the person in writing of the reasons.
    The USTR must submit a semiannual report to the Congress 
describing petitions filed and determinations made, 
developments in and the status of investigations and 
proceedings, actions taken or the reasons for no action under 
section 301, and the commercial effects of section 301 actions 
taken. The USTR must also keep the petitioner regularly 
informed of all determinations and developments regarding 
section 301 investigations.

   Identification of Intellectual Property Rights Priority Countries 
                             (Special 301)

    Section 182 of the Trade Act of 1974, added by section 1303 
of the Omnibus Trade and Competitiveness Act of 1988, requires 
the USTR to identify, within 30 days after submission of the 
annual National Trade Estimates (foreign trade barriers) report 
to the Congress required by section 181 the 1974 Act (i.e., by 
April 30) those foreign countries that (1) deny adequate and 
effective protection of IPR or fair and equitable market access 
to U.S. persons that rely upon IP protection; and (2) those 
countries under paragraph (1) determined by the USTR to be 
``priority foreign countries.'' The USTR is to identify as 
priority countries only those that have the most onerous or 
egregious acts, policies, or practices with the greatest 
adverse impact on the relevant U.S. products, and that are not 
entering into good faith negotiations or making significant 
progress in bilateral or multilateral negotiations to provide 
adequate and effective IPR protection. In identifying foreign 
countries, the USTR is to take into account the history of IP 
laws and practices of the foreign country as well as efforts of 
the United States, and the response of the foreign country, to 
achieve adequate and effective protection and enforcement of 
IPR. A country may be identified notwithstanding the fact that 
it may be in compliance with the specific obligations of the 
TRIPs Agreement. The USTR at any time may revoke or make an 
identification of a priority country, but must include in the 
semiannual section 301 report to the Congress a detailed 
explanation of the reasons for a revocation.
    In addition, as a matter of administrative practice, the 
USTR has established a ``priority watch list'' of countries 
whose acts, policies, and practices meet some, but not all, of 
the criteria for priority foreign country identification. The 
problems of these countries warrant active work for resolution 
and close monitoring to determine whether further Special 301 
action is needed. Also, the USTR maintains a ``watch list'' of 
countries that warrant special attention because they maintain 
IP practices or barriers to market access that are of 
particular concern. Finally, the USTR has added a ``Special 
Mention'' category.
     Section 302(b) requires the USTR to initiate a section 301 
investigation within 30 days after identification of a priority 
country with respect to any act, policy, or practice of that 
country that was the basis of the identification, unless the 
USTR determines initiation of an investigation would be 
detrimental to U.S. economic interests and reports the reasons 
in detail to the Congress. The procedural and other 
requirements of section 301 authority generally apply to these 
cases, except that investigations must be concluded and 
determinations made on whether the measures are actionable and 
an appropriate response within a tighter time limit of 6 
months, which may be extended to 9 months if certain statutory 
criteria are met.

History of Special 301

    On May 26, 1989, after the first annual Special 301 review, 
the USTR announced that because of significant progress made in 
various negotiations, no priority countries had been identified 
under Special 301. Rather, under administrative authority, 25 
countries were singled out whose practices deserved special 
attention, of which 17 countries were placed on a newly created 
watch list and 8 countries were placed on a new priority watch 
list to be reviewed again no later than November 1, 1989.
    On November 1, 1989, the USTR announced that progress had 
been made in negotiations to obtain improved IPR protection and 
enforcement with each of the eight countries on the priority 
watch list. Korea, Taiwan, and Saudi Arabia were moved to the 
watch list because of their significant progress. The other 
five countries (Brazil, India, Mexico, People's Republic of 
China (PRC), and Thailand) remained on the priority watch list. 
No country was designated as a ``priority foreign country'' 
making it subject to section 301 investigation.
    In January 1990, Mexico was removed from all Special 301 
lists after outlining a program for improved IP protection and 
enforcement. On April 27, 1990, the USTR noted that because 
significant progress had been made in negotiations with 
countries previously identified under Special 301, no country 
would be designated as a ``priority foreign country'' in 1990. 
At that time, Portugal also was removed from all lists, due to 
improved protection of IPR in that country.
    On April 26, 1991, the USTR announced the identification of 
the PRC, India, and Thailand as ``priority foreign countries.'' 
All three countries had been on the priority watch list since 
the first annual review in 1989 with no significant progress 
made. Section 301 investigations of the China and India 
protection deficiencies began on May 26; Thailand's practices 
were already the subject of two section 301 investigations. 
Brazil was retained and the European Community (EC) and 
Australia were added to the priority watch list; 23 countries 
were retained or placed on the watch list, and Malaysia was 
removed. On November 26, the USTR announced that negotiations 
with the PRC had not succeeded; a draft list of Chinese 
products that might be subject to retaliatory tariffs was 
published for public comment the following day. On December 16, 
the USTR announced that January 16, 1992 would be the firm 
deadline for concluding any further negotiations with China and 
determining the specific response to inadequate protection. On 
November 26, the deadline for the India investigation was 
extended because of progress made and the complex issues 
involved.
    On January 16, 1992, the USTR announced that the United 
States and China had signed a Memorandum of Understanding that 
committed China to provide improved protection for U.S. IPR and 
ended the Special 301 investigation. On April 29, the USTR 
announced the addition of Taiwan and the retention of India and 
Thailand as ``priority foreign countries.'' Six countries--
Egypt, Hungary, Korea, the Philippines, Poland, and Turkey--
were placed on the priority watch list; Australia, Brazil, and 
the EC were retained on that list. Twenty-two countries were 
placed or retained on the watch list. Duty-free treatment on 
imports of certain eligible products from India under the GSP 
program was suspended on April 29. On October 9, USTR 
reaffirmed the determination in the section 301 investigation 
of Thailand's patent protection made on March 13, but again 
deferred action in order to negotiate with the new Thai 
government. The section 301 case on Thai copyright practices 
was terminated in December 1991; implementation of measures by 
the Thai government to eliminate the unreasonable practices is 
being monitored. Thailand has been denied full benefits under 
the GSP program since 1989.
    On April 30, 1993, the USTR announced the retention of 
Brazil, India, and Thailand as ``priority foreign countries'' 
and placed 10 countries on the priority watch list and 17 
countries on the watch list. The USTR also announced new steps 
to resolve outstanding IPR problems with priority watch list 
countries by initiating ``immediate action plans'' for Hungary 
and Taiwan to be completed by July 31, 1993; conducting ``out-
of-cycle'' reviews during 1993 (including deadlines and 
benchmarks for evaluating performance) for Korea, Argentina, 
Egypt, Poland, and Turkey; and intensifying consultations with 
Australia, the EC, and Saudi Arabia. ``Out-of-cycle'' reviews 
would also be conducted with 5 of the 17 watch list countries: 
Cyprus, Italy, Pakistan, Spain, and Venezuela. Canada, Germany, 
and Paraguay were removed from the watch list. On May 6, the 
USTR announced that a special review would be conducted on July 
31 of Thailand's progress.
    On August 2, 1993, the USTR announced the results of 
reviews conducted in July: a comprehensive agreement with 
Hungary that would result in its removal from the priority 
watch list; reexamination within 30 days of Thailand's status 
based on further progress achieved and comprehensive review in 
early 1994 of further Thai efforts; and that Taiwan's status 
would be reviewed based on progress in completing elements of 
the ``immediate action plan.'' On September 9, the USTR 
announced that, as a result of the July review, Thailand's 
identification as a ``priority foreign country'' would be 
revoked, Thailand would be placed on the priority watch list, 
and another review of its progress would be conducted in early 
1994. On November 30, the USTR announced that the PRC would be 
moved from the watch list to the priority watch list because of 
its failure to enforce IPR laws and regulations.
    On April 30, 1994, the USTR announced that Argentina, 
China, and India would be designated as ``priority foreign 
countries'' if satisfactory progress was not reached by June 
30. Six countries were placed on the priority watch list: the 
EU, Japan, Korea, Saudi Arabia, Thailand, and Turkey. Eighteen 
countries were placed on the watch list, with ``out-of-cycle'' 
reviews to be conducted of Egypt, El Salvador, Greece, and the 
United Arab Emirates. An additional ``special mention'' 
category was also announced of nine countries where there is 
need for greater effort or further improvement or IP problems 
are beginning to become serious: Brazil, Canada, Germany, 
Honduras, Israel, Panama, Paraguay, Russia, and Singapore. The 
USTR also announced that significant progress had been made 
with a number of countries. On June 30, the USTR announced the 
designation of China as a ``priority foreign country'' and the 
immediate initiation of a section 301 investigation. Argentina 
and India were placed on the priority watch list, with India 
also to be subject to an ``out-of-cycle'' review in January 
1995. On August 12, 1994, the USTR initiated a review to 
consider whether Thailand should be restored to full 
beneficiary developing country status under the GSP program 
because of progress on IPR protection.
    On February 7, 1995, the USTR concluded its section 301 
investigation of China and determined that certain acts, 
policies, and practices of the Chinese government with respect 
to the enforcement of IPR and the provision of market access to 
persons who rely on IP protection are unreasonable and 
constitute a burden or restriction on U.S. commerce. The USTR 
determined further that trade action was appropriate in the 
form of increasing duties to 100 percent ad valorem for certain 
products, effective February 26, 1995. However, on February 26, 
1995, based on an agreement with China, the USTR determined not 
to impose sanctions, terminated the investigation, and revoked 
China's identification as a priority foreign country.
    On April 29, 1995, the USTR announced no priority foreign 
country designations. However, USTR stated that the number of 
out-of-cycle reviews would be increased so that progress may be 
reviewed during the course of the year, rather than only at the 
end of April when the annual review occurs. The USTR placed 
Brazil, Greece, Japan, Saudi Arabia, and Turkey on the priority 
watch list and stated that they would be subject to review 
during the course of the year. Other countries on the priority 
watch list included the EU, India, and Korea. The USTR placed 
24 countries on the watch list and stated that it would conduct 
out-of-cycle reviews with 4 of these countries: Argentina, the 
United Arab Emirates, Indonesia, and South Africa. The USTR 
also noted growing concerns about IP property in five countries 
and highlighted developments and expectations for progress in 
six countries.
    On January 19, 1996, the USTR announced the results of 
Special 301 out-of-cycle reviews. Specifically, Turkey and 
Japan would remain on the watch list, and the investigation 
concerning Indonesia would be continued because more 
information was expected concerning Indonesia's enforcement 
activities.
    On April 30, 1996, the USTR announced that it would 
initiate four WTO dispute settlement actions against Portugal, 
Turkey, India, and Pakistan for failure to fulfill certain WTO 
obligations related to IPR. In addition, the USTR identified 35 
trading partners that deny adequate and effective protection of 
IPR or deny fair and equitable market access to U.S. persons 
that rely upon intellectual property protection, as well as 19 
trading partners that would be monitored. Specifically, the 
USTR designated China as a priority foreign country because of 
its failure to implement the 1995 IP agreement. Eight countries 
were placed on the priority watch list: Argentina, Greece, the 
European Union, India, Indonesia, Japan, Korea, and Turkey. The 
USTR announced placement of 26 countries on the watch list, 
with out-of-cycle reviews to be conducted with respect to El 
Salvador, Italy, Paraguay, the Philippines, Russia, Saudi 
Arabia, and Thailand.
    On June 17, 1996, the USTR announced that, based on 
measures that China had taken and would take in the future to 
implement key elements of the 1995 Agreement, it would not 
impose sanctions and would revoke China's status as a priority 
foreign country. On October 21, 1996, the USTR announced the 
termination of the WTO consultations with Portugal based on 
measures that Portugal agreed to take to implement its WTO 
obligations.
    On October 2, 1996, the USTR announced the results of 
certain out-of-cycle reviews. Specifically, the USTR placed 
Bulgaria and Bolivia on the watch list, maintained Paraguay on 
the watch list, deferred the decision on Greece, and determined 
that South Africa would remain unlisted.
    Finally, on December 20, 1996, the USTR announced out-of-
cycle review decisions. It retained Greece, Russia, and Saudi 
Arabia on the priority watch list, maintained reviews for 
Argentina and the Philippines, and determined that Hong Kong 
would not be placed on the watch list but that U.S. government 
monitoring would continue.
    On April 30, 1997, the USTR released its 1997 Special 301 
annual review. In the review, the USTR announced that it would 
initiate WTO dispute settlement actions against four countries 
designated as priority foreign countries: Denmark, Sweden, 
Ireland and Ecuador. In addition, the USTR announced that 
Greece and Luxembourg would be designated priority foreign 
countries, but that dispute settlement proceedings would not be 
initiated if the countries met their TRIPs obligations in the 
coming months. The USTR also placed 10 countries on the 
priority watch list: Argentina, Ecuador, Egypt, the EU, Greece, 
India, Indonesia, Paraguay, Russia, and Turkey. Thirty-six 
countries were placed on the watch list. Of the 36 watch-list 
countries, the USTR announced that it would conduct out-of-
cycle reviews for 7: Bulgaria, Canada, Hong Kong, Luxembourg, 
Panama, Thailand and Italy. Finally, the USTR stated that China 
would continue to be subject to monitoring under section 306.
    On October 27, 1997, the USTR issued certain out-of-cyle 
review decisions. The USTR announced that Luxembourg had made 
progress toward implementing its WTO obligations under the 
TRIPs, and that as a result, the United States would not 
initiate a dispute settlement proceeding at that time. However, 
Luxembourg was placed on the Special 301 watch list. Out-of-
cycle determinations were also made for: Ecuador (remained on 
the priority watch list); Italy (remained on the watch list); 
Thailand (remained on the watch list); and Panama (removed from 
the watch list.) Finally, the USTR cited Australia for actions 
to remove protections for sound recordings.
    On January 16, 1998, the USTR released its next set of out-
of-cycle review determinations. USTR designated Paraguay as a 
priority foreign country, and announced that a special 301 
investigation would be initiated within 30 days. Other results 
of the review include: Bulgaria's elevation to the priority 
watch list; Turkey's retention on the priority watch list; 
Brazil and Hong Kong's continued designation on the watch list; 
and an expression of concern about Ecuador's continued failure 
to implement its TRIPs obligations by the deadline established 
under the terms of its WTO accession.
    On March 30, 1998, the USTR announced that the 
Administration would suspend a portion of Honduras' benefits 
under GSP and the Caribbean Basin Initiative because of IPR 
violations. (Benefits were restored on June 30, 1998.)
    On May 1, 1998, the USTR released its 1998 Special 301 
annual review. In the review, the USTR announced that it would 
initiate WTO dispute settlement actions against Greece and the 
EU. (Greece was designated a priority foreign country in the 
1997 Special 301 annual review.) In addition, the USTR placed 
15 countries on the priority watch list: Israel, Macau, 
Argentina, Ecuador, Egypt, the EU, Greece, India, Indonesia, 
Russia, Turkey, Bulgaria, Italy, the Dominican Republic, and 
Kuwait. An out-of-cycle review would be conducted for Bulgaria. 
The USTR also placed 31 countries on the watch list. Of the 31 
watch list countries, USTR announced that out-of-cycle reviews 
would be conducted for four: Hong Kong, Colombia, Jordan, and 
Vietnam. Finally, USTR indicated that China would continue to 
be subject to monitoring under section 306.
    On November 2, 1998, the USTR announced the results of its 
out-of-cycle review for Bulgaria. USTR moved Bulgaria from the 
priority watch list to the watch list based on Bulgaria's 
improved enforcement of intellectual property rights.
    On February 19, 1999, the USTR announced the results of its 
out-of-cycle reviews of Hong Kong, Ecuador, Colombia and 
Vietnam. USTR removed Hong Kong from the Special 301 watch list 
because of Hong Kong's efforts to combat piracy. Ecuador 
remained on the priority watch list, and Colombia and Vietnam 
remained on the watch list.
    On April 30, 1999, the USTR released its 1999 Special 301 
annual review. In the review, the USTR announced that it would 
initiate WTO dispute settlement actions against Argentina, 
Canada, and the EU. Sixteen countries were placed on the 
priority watch list: Israel, Ukraine, Macau, Argentina, Peru, 
Egypt, the E.U., Greece, India, Indonesia, Russia, Turkey, 
Italy, the Dominican Republic, Guatemala, and Kuwait. The USTR 
also placed 37 countries on the watch list. USTR announced that 
it would conduct out-of-cycle reviews for Malaysia, Hong Kong, 
Israel, Kuwait, South Africa, Colombia, Poland, the Czech 
Republic, and Korea. The USTR also announced that China and 
Paraguay would be subject to monitoring under section 306.
    Finally, USTR reported on the progress of TRIPs cases 
previously filed in the WTO. The U.S. case against Sweden ended 
in December 1998, when the United States and Sweden notified 
the WTO that they had reached a mutually satisfactory 
resolution to the U.S. complaint. The cases against Ireland, 
Greece and Denmark were still pending. The United States 
continued to raise questions about India's compliance with the 
December 1997 dispute settlement decision on patent protection 
for pharmaceuticals and agricultural chemicals.
    On December 10, 1998, the USTR announced the results of its 
out-of-cycle review for Jordan. USTR removed Jordan from the 
watch list.
    On December 19, 1999, the USTR announced the results of its 
out-of-cycle review for Colombia, the Czech Republic, Hong 
Kong, and Malaysia. As a result of the reviews, USTR decided 
not to put Hong Kong and Malaysia on the watch list. Colombia 
and the Czech Republic remained on the list.
    In December 1999, the USTR initiated out-of-cycle reviews 
to examine the progress of developing countries toward 
implementing their TRIPs obligations. The review was prompted 
by concern that many developing countries would not be in 
compliance by the January 1, 2000 deadline for implementation 
of TRIPs obligations. The review revealed that a number of 
countries are still in the process of finalizing implementing 
legislation. The USTR indicated its intent to continue to work 
with such countries bilaterally and through the review process 
in the WTO TRIPS Council meetings. In instances where 
additional progress was not likely in the near term, or where 
the United States was been unable to resolve concerns through 
bilateral consultation, USTR pursued the matter in dispute 
settlement (e.g. the actions initiated against Argentina and 
Brazil pursuant to the 2000 Special 301 annual review).
    On May 1, 2000, the USTR released its 2000 Special 301 
annual review. In the review, the USTR announced initiation of 
WTO dispute settlement proceedings against Argentina and 
Brazil, and the continuation of proceedings against Denmark. 
The USTR also noted continued concern about Ireland's failure 
to fully implement TRIPs obligations.
    Sixteen countries were placed on the priority watch list in 
the 2000 review: Argentina, Dominican Republic, E.U., Egypt, 
Greece, Guatemala, India, Israel, Italy, Korea, Malaysia, Peru, 
Poland, Russia, Turkey and Ukraine. Of the countries placed on 
the priority watch list, the USTR announced that out-of-cycle 
reviews would be conducted for Italy and Korea. Thirty-nine 
countries were placed on the watch list, of which, only one, 
Macay, was designated for an out-of-cycle review. EL Salvador 
and West Bank/Gaza Strip were also scheduled for out-of-cycle 
reviews. Finally, the USTR announced the China and Paraguay 
would continue to be subject to monitoring under section 306.
    The USTR also used the occasion of the annual Special 301 
report to review the Clinton Administration's effort to 
coordinate IPR enforcement with global health policy. On 
December 1, 1999, President Clinton announced that the United 
States was committed to helping developing countries gain 
access to essential medicines, including those for the 
prevention and treatment of HIV/AIDs. The USTR and the 
Secretary of Health and Human Resources implemented the 
President's announcement by developing a cooperative approach 
on health-related IPR matters. Under the new policy, when a 
foreign government expressed concern that a U.S. trade law 
related to IP protection significantly impeded the foreign 
country's ability to address a health crisis in that country, 
the USTR would seek and give full weight to the advice of the 
Secretary of Health and Human Services regarding the health 
considerations involved. The USTR cited on-going consultations 
with Thailand over the compulsory licensing of an HIV/AIDs drug 
as an example of how the new policy had been applied. The USTR 
also indicated that the Special 301 Committee took health and 
development issues into account in making its Special 301 
recommendations. On May 10, 2000, President Clinton issued 
Executive Order 13155 formalizing this policy with respect to 
sub-Saharan African countries and access to HIV/AIDS drugs.
    On November 8, 2000, the USTR announced the results of its 
out-of-cycle reviews for El Salvador, Italy, Poland and 
Ireland. As result of the reviews, Italy, and Poland were moved 
from the priority watch list to the watch list. Ireland was 
removed from the watch list, and El Salvador was not placed on 
the watch list. The USTR also noted that the Bahamas had taken 
steps to bring its copyright laws into compliance with its 
international obligations.
     On January 19, 2001, the USTR announced the results of its 
out-of-cycle reviews for Ukraine, Macau, Korea, the United Arab 
Emirates, Hungary, Slovenia, and the West Bank/Gaza Strip. The 
decision on designation of Ukraine as a priority foreign 
country was deferred until March 1, 2001. Korea remained on the 
priority watch list, while Macau and Hungary remained on the 
watch list. The United Arab Emirates and Slovenia did not 
receive a listing. The review of the West Bank/Gaza was put on 
indefinite hold due to regional unrest.

     Identification of Trade Liberalization Priorities (Super 301)

    Section 310 of the Trade Act of 1974, as amended by section 
1302 of the Omnibus Trade and Competitiveness Act of 1988, 
required the USTR, within 30 days after the National Trade 
Estimates (foreign trade barriers) report to the Congress in 
1989 and 1990, to identify U.S. trade liberalization 
priorities.
    This identification included priority practices as well as 
priority foreign countries and estimates of the amount by which 
U.S. exports would be increased if the barrier did not exist. 
USTR was required to initiate section 301 investigations on all 
priority practices identified for each of the priority 
countries within 21 days after submitting the report to the 
House Ways and Means and Senate Finance Committees. In its 
consultations with the foreign country, USTR was required to 
seek to negotiate an agreement which provided for the 
elimination of, or compensation for, the priority practices 
within 3 years after the initiation of the investigation. This 
authority, however, expired in 1990.
    On March 3, 1994, President Clinton issued Executive Order 
12901 requiring the USTR, within 6 months of the submission of 
the National Trade Estimates report for 1994 and 1995, to 
review U.S. trade expansion priorities and identify priority 
foreign country practices, the elimination of which would 
likely have the most significant potential to increase U.S. 
exports. On September 27, 1995, President Clinton issued 
Executive Order 12973, which extended the terms of Executive 
Order 12901 to 1996 and 1997. The order required the USTR to 
submit to the House Ways and Means and Senate Finance 
Committees and to publish in the Federal Register a report on 
the priority foreign country practices identified. The report 
was not submitted in 1998, because the authority expired in 
1997, and was not renewed until March 31, 1999, pusuant to 
Executive Order 13116.
    Under the terms of the executive order, the USTR must 
initiate section 301 investigations within 21 days of the 
submission of the report with respect to all priority foreign 
country practices identified. The normal section 301 
authorities, procedures, time limits, and other requirements 
generally apply to these investigations. In consultations 
requested with the foreign country under section 303, the USTR 
must seek to negotiate an agreement providing for the 
elimination of the practices as quickly as possible or, if that 
is not feasible, compensatory trade benefits. The USTR will 
monitor any agreements pursuant to section 306. The semiannual 
report under section 309 will include the status of any 
investigation and, where appropriate, the extent to which it 
has led to increased U.S. export opportunities.
    Section 314(f) of the Uruguay Round Agreements Act codified 
the terms of the executive order for the year 1995 as an 
amendment to section 310 of the 1974 Act.

History of Super 301

    On May 26, 1989, the USTR submitted the 1989 report to the 
two committees on trade liberalization priorities, identifying 
six ``priority'' practices from three ``priority countries.'' 
They were:
          (1) Japan.--Ban on government procurement of foreign 
        satellites; exclusionary government procurement of 
        supercomputers; restrictions on imports of wood 
        products.
          (2) Brazil.--Import bans and other licensing 
        restrictions.
          (3) India.--Trade-related investment measures; 
        insurance market barriers.
    Section 301 investigations were initiated on each of the 
six priority practices on June 16, 1989. The Administration 
also launched a separate initiative with Japan in July 1989 to 
address the causes of the slow adjustment of the United States 
and Japanese trade imbalances (the Structural Impediments 
Initiative (SII)).
    In its 1990 report to the committees on April 27, 1990, the 
USTR identified India again as a ``priority country'' with the 
same two practices identified again as ``priority practices'' 
because the issues remained unresolved. The report stated that 
satisfactory solutions had been reached with Japan on its three 
priority practices and that the priority practice of Brazil was 
expected to be resolved. Letters were exchanged between the 
USTR and Japanese Ambassador regarding unilateral actions by 
the Japanese government to improve access for U.S. firms to its 
satellite market and to specify detailed new procurement 
procedures; to improve access for U.S. firms to its 
supercomputer procurement market through open, competitive, and 
transparent purchasing procedures; and to improve market access 
for U.S. wood products. The report identified the successful 
completion of the Uruguay Round of GATT multilateral trade 
negotiations as the top trade liberalization priority.
    On June 14, 1990, the USTR determined that India's priority 
practices were unreasonable and burden or restrict U.S. 
commerce, but that retaliation would be inappropriate given the 
ongoing Uruguay Round negotiations on services and investment. 
If necessary, a post-Uruguay Round review would determine 
whether section 301 action was warranted.
    On June 28, 1990, the U.S.-Japan Working Group on the 
Structural Impediments Initiative issued an SII Joint Report, 
following up on an interim report issued in April. This final 
report contained commitments by both governments on steps to 
address various structural impediments to the adjustment of 
trade and current account imbalances, with followup through 
regular high-level meetings, progress review, and annual 
reports.
    On May 1, 1992, and on April 30, 1993, the USTR reported on 
its monitoring of Japan's implementation of its commitments 
regarding the three practices and on progress made in the 
liberalization of Brazil's import regime. The report also 
reaffirmed the decision in 1990 to review, if necessary, 
India's investment and insurance practices following conclusion 
of the GATT Uruguay Round to determine whether section 301 
action was warranted.
    The USTR announced in the 1993 report that a special review 
would be undertaken, pursuant to section 306, of Japanese 
actions under the U.S.-Japan Supercomputer Agreement because of 
U.S. government concern that Japan might not be adhering to the 
terms of that Agreement. Based upon this review and the conduct 
and outcome of procurements scheduled in coming months, the 
USTR would determine whether Japan was in compliance with the 
Agreement. If the USTR determined Japan was not in compliance, 
the USTR would initiate trade action against Japan under 
section 301.
    On April 30, 1994, the USTR announced that the special 
review of Japanese actions under the 1990 Supercomputer 
Agreement would continue as a result of several major areas of 
concern. Monitoring would continue of the operation of the new 
procedures for Japanese procurement of satellites and of 
implementation of the Wood Products Agreement. Improvements in 
India's investment and insurance regimes would be pursued in 
bilateral discussions.
    Pursuant to Executive Order 12901 of March 3, 1994, the 
USTR reported on October 3, 1994 that it had decided not to 
identify any priority foreign country practices. Japan's market 
access for wood and paper was described as perhaps warranting 
identification in the future, and various foreign practices 
were determined not to be appropriate for identification 
because they were already being otherwise addressed.
    On September 28, 1995, the USTR reported that it again had 
decided not to identify any priority foreign practices. 
However, the USTR found that certain practices may in the 
future warrant identification as priority foreign country 
practices: Japan market access for paper and paper products, 
Japan market access for wood products, and China market access 
for agricultural products. In addition, the USTR listed certain 
practices as not appropriate for identification because they 
were being otherwise addressed.
    On October 1, 1996, the USTR announced that it again had 
decided not to identify any priority foreign country practices. 
However, it initiated new actions in the WTO concerning 
Indonesia's national auto policy, Brazil's auto program, 
Australia's export subsidies, and Argentina's import duties. It 
also announced the adoption of a strategic enforcement strategy 
in the automotive trade sector. The USTR also listed several 
other bilateral priorities that may warrant identification as 
priority foreign country practices in the future: Japan market 
access for insurance, Japan telecommunications, Japan market 
access for paper and paper products, China market access for 
agricultural products, Korea telecommunications, Germany 
electrical equipment, EU Ecolabeling Directive, EU design-
restrictive standards, and Saudi Arabia International 
Conformity Certification Program.
    On October 8, 1997, the USTR submitted its report on trade 
expansion priorities to the Senate Finance Committee and the 
House Ways and Means Committee. The report identified one 
priority foreign country, announced initiation of dispute 
settlement proceedings in four other cases, identified a number 
of practices that might warrant identification as a priority 
foreign country practice in the future, and described the 
progress made in addressing previously identified market access 
barriers.
    The priority foreign country practice was Korean barriers 
to auto imports. The dispute settlement cases were on: (1) 
Japanese market access barriers to fruit; (2) Canadian export 
subsidies and import quotas on dairy products; (3) E.U. 
circumvention of export subsidy commitments on dairy products; 
and (4) Australian export subsidies on automotive leather. 
Practices that warranted further monitoring and could require 
future action included: (1) the E.U. specified risk material 
ban, cosmetic initiative, design standards, the eco-labeling 
directive, and units of measurement directive; (2) French 
restrictions on pet food imports; (3) Australian pest risk 
analysis; (4) Argentinian footwear import restrictions; (4) 
Brazilian import financing measures; and (5) Taiwanese market 
access barriers to pharmaceuticals.
    Finally, the USTR identified three countries in which on-
going negotiations were yielding some success, but that 
required continued monitoring. The countries and practices 
identified were: (1) Japan--market access for flat glass and 
paper and paper products; (2) China--IPR enforcement, sanitary 
and phytosanitary measures, market access for meat products, 
registration of financial information providers, and market 
access for insurance providers; and (3) Korea--impediments to 
entry and distribution of cosmetics, import clearance 
procedures, and steel subsidies.
    On April 30, 1999, pursuant to Executive Order 13116 of 
March 31, 1999, the USTR submitted its report to the Committees 
on trade expansion priorities and priority foreign country 
practices. In the 1999 report, the USTR did not identify any 
priority foreign country practices. The USTR did find that a 
number of practices warranted the initiation of WTO dispute 
settlement proceedings, announced initiation of one section 301 
investigation, and identified a number of practices that might 
warrant identification as a priority foreign country practice 
in the future.
    With respect to initiation of WTO proceedings, the USTR 
indicated that it would request WTO dispute settlement 
consultations with the E.U. on government subsidies for 
avionics equipment and geographical indications, and with India 
on automotive trade and investment measures. The USTR reported 
that it had requested the formation of a WTO dispute settlement 
panel on Korean restrictions on beef imports and their 
distribution, and had initiated dispute settlement procedures 
on Korean measures related to airport construction. The USTR 
also reported that it was working within the Committee on 
Customs Valuation to examine non-compliance with the WTO 
Customs Valuation Agreement with respect to Brazil, India and 
Mexico, and on the general use of reference pricing by a number 
of WTO Members.
    USTR also reported that it had initiated an investigation 
under section 301 of the Trade Act of 1974 on Canadian 
regulations affecting tourism in the U.S.-Canada border region.
    Practices that warranted further monitoring and could 
require future action included: (1) Canadian restrictions on 
agriculture exports and discrimination against U.S. magazines; 
(2) Japanese insurance deregulation, market access restrictions 
on autos, auto parts, and flat glass; (3) Korean treatment of 
pharmaceuticals; (4) Mexico's application of antidumping 
measures on high-fructose corn syrup and telecommunication 
barriers.
    On April 30, 2000, the USTR submitted its report to the 
Committees on trade expansion priorities and priority foreign 
country practices. In the 2000 report, the USTR again did not 
identify any priority foreign country practices. The USTR did 
find that a number of practices warranted the initiation of WTO 
dispute settlement proceedings, and identified a number of 
practices that might warrant identification as a priority 
foreign country practice in the future.
    With respect to initiation of WTO proceedings, the USTR 
indicated that it would request WTO dispute settlement 
consultations in two customs valuation cases: (1) Brazil on 
reference prices for certain textile products; and (2) Romania 
on discriminatory reference prices for products such as 
clothing, poultry, and certain types of distilled spirits. The 
USTR also announced that it would request the establishment of 
a panel on India's automotive trade and investment measures, 
and would request consultations with the Philippines on local 
content requirements for motorcycles, automobiles and certain 
commercial vehicles.
    Practices that warranted further monitoring and could 
require future action included: (1) E.U. subsidization of 
Airbus; (2) Japanese market access restrictions and competition 
problems in the flat glass, auto/auto parts, and public works 
sectors; (3) Korea market access barriers to pharmaceuticals 
and autos; (4) Mexico's use of a minimum price regime for 
certain imported products; (5) Indian tariffs on textiles; and 
(6) Malaysian trade and investment measures on motor vehicles.

                       Foreign Direct Investment

    Section 307(b) of the Trade and Tariff Act of 1984 requires 
the U.S. Trade Representative to seek the reduction and 
elimination of foreign export performance requirements through 
consultations and negotiations with the country concerned if 
the USTR determines, with interagency advice, that U.S. action 
is appropriate to respond to such requirements that adversely 
affect U.S. economic interests. In addition, the USTR may 
impose duties or other import restrictions on the products or 
services of the country involved, including exclusion from 
entry into the United States of products subject to these 
requirements. The USTR may provide compensation for such action 
subject to the provisions of section 123 of the Trade Act of 
1974 if necessary or appropriate to meet U.S. international 
obligations.
    Section 307(b) authority does not apply to any foreign 
direct investment, or to any written commitment relating to 
foreign direct investment that is binding, made directly or 
indirectly by any U.S. person prior to October 30, 1984 (date 
of enactment of the 1984 Act).

                   Foreign Anticompetitive Practices

    Section 311 of the Uruguay Round Agreements Act provides 
for including an identification of foreign anticompetitive 
practices, the toleration of which by foreign governments is 
adversely affecting exports of U.S. goods or services, as part 
of the National Trade Estimate report to be submitted each 
year. The USTR is to consult with the Attorney General in 
preparing this section of the report.

                    Unfair Practices in Import Trade


           Section 337 of the Tariff Act of 1930, as amended

    Section 337 of the Tariff Act of 1930 \26\ declares 
unlawful unfair methods of competition and unfair acts in the 
importation or sale of articles (other than articles relating 
to certain intellectual property rights), the threat or effect 
of which is to (1) destroy or substantially injure an industry 
in the United States; (2) prevent the establishment of such an 
industry; or (3) restrain or monopolize trade and commerce in 
the United States. Section 337 also declares unlawful the 
importation or sale of articles that (1) infringe a valid and 
enforceable U.S. patent or registered copyright; or are made, 
produced, processed, or mined under a process covered by a 
valid and enforceable U.S. patent; (2) infringe a valid and 
enforceable U.S.-registered trademark; (3) infringe a 
registered mask work of a semiconductor chip product; or 
infringe exclusive rights in a protected design. For this 
separate class of intellectual property rights, the importation 
or sale of infringing articles is unlawful only if an industry 
in the United States producing the articles protected by the 
patent, copyright, trademark, mask work, or design exists or is 
in the process of being established. It is not necessary to 
establish that the industry is injured by reason of such 
imports, as is the case with non-intellectual property rights 
violations. A U.S. industry is considered to exist if there is 
(1) significant investment in plant and equipment; (2) 
significant employment of labor or capital; or (3) substantial 
investment in the exploitation of the patent, copyright, 
trademark, mask work, or design, including engineering, 
research and development, or licensing.
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    \26\ Public Law 71-361, section 337, approved June 17, 1930, 19 
U.S.C. 1337.
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    The U.S. International Trade Commission (ITC) is 
responsible for investigating alleged violations of section 
337. Upon finding a violation, the ITC may issue an exclusion 
order and/or a cease and desist order, subject to presidential 
disapproval.
    Section 337 is unique among the trade remedy laws in that 
it is the only one subject to the provisions of the 
Administrative Procedure Act (APA).\27\ All ITC investigations 
and determinations under section 337 must be conducted on the 
record after publication of notice and opportunity for hearing 
in conformity with the APA.\28\
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    \27\ Act of June 11, 1946, ch. 324, sections 1-12, 5 U.S.C. 551 et 
seq.
    \28\ 19 U.S.C. 1337(c).
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    The language of section 337 closely parallels that of 
section 5 of the Federal Trade Commission Act,\29\ and 
therefore the scope of section 337 has been compared to that of 
the antitrust and unfair competition statutes. The ITC has 
significant discretion in determining what practices are 
``unfair'' under section 337. In practice, however, the 
overwhelming majority of cases dealt with under section 337 has 
been in the area of patent infringement. Among the few non-
patent cases have been cases involving group boycotts, price 
fixing, predatory pricing, false labeling, false advertising, 
and trademark infringement.
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    \29\ Public Law 63-203, approved September 26, 1914, 38 Stat. 717, 
15 U.S.C. 45.
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    Whenever, in the course of a section 337 investigation, the 
ITC has reason to believe that the matter before it involves 
dumping or subsidization of imports within the purview of the 
antidumping or countervailing duty laws, it must notify the 
administering authority of those laws for appropriate 
action.\30\ If the alleged violation of section 337 is based 
solely on such dumping or subsidization practices, the ITC must 
terminate (or not initiate) the section 337 investigation. If 
it is based in part on such practices, and in part on other 
alleged practices, then the ITC may continue (or initiate) an 
investigation under section 337. This provision is designed to 
avoid duplication and conflicts in the administration of the 
unfair trade practice laws.
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    \30\ 19 U.S.C. 1337(b)(3).
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    The Audio Home Recording Act of 1992 \31\ added alleged 
copyright infringements with respect to which action is 
prohibited by the new 17 U.S.C. 1008, to the practices for 
which the ITC must terminate or not institute an investigation 
under section 337. Section 1008 prohibits action under title 17 
alleging copyright infringement based on the manufacture, 
importation, or distribution of a digital audio technology 
(DAT) recorder and related items.
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    \31\ Public Law 102-563, approved October 28, 1992.
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General Agreement on Tariffs and Trade (GATT) panel determination

    In response to a complaint by the European Community (EC) 
about the application of section 337, the GATT Council agreed 
on October 7, 1987 to establish a panel to review the U.S. law. 
On November 23, 1988, the panel found that section 337 is 
inconsistent with the national treatment provision article 
III:4 of the GATT because it afforded less favorable treatment 
to imported products alleged to infringe U.S. patents than that 
given in federal district court to challenged domestically 
manufactured goods. Specifically, the panel pointed to the 
complainants' choice of two fora in which to challenge imported 
products, without a corresponding choice available to challenge 
products of U.S. origin; the potential disadvantage to 
producers or importers of challenged products of foreign origin 
resulting from the tight time-limits that apply to producers of 
challenged products of U.S. origin; and the possibility that 
producers or importers of challenged products of foreign origin 
may have to defend their products both before the ITC and in 
federal district court while no corresponding exposure exists 
with respect to U.S.-made goods. The panel recommended that the 
GATT contracting parties request the United States to bring its 
procedures for patent infringement cases involving imports into 
conformity with the GATT.
    The panel report was adopted at a GATT Council meeting on 
November 9, 1989. The United States amended section 337 to 
address the panel report in the Uruguay Round Agreements 
Act.\32\ At the request of the EC, the United States and the EC 
held WTO consultations on Febraury 28, 2000 to discuss the 
compliance of section 337, as amended, with U.S. obligations on 
national treatment and under the agreement on Trade--Related 
Aspects of Intellectual Property Rights (TRIPS).
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    \32\ Public Law 103-465.
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Procedure

    The ITC is required to investigate any alleged violation of 
section 337 on complaint under oath or upon its own initiative. 
The Uruguay Round Agreements Act amended the provision so that 
there are no longer any deadlines for the investigation. 
Instead, the ITC must, within 45 days of initiation, set a 
target date and conclude its investigation at the earliest 
practicable time. Before this amendment, the ITC was required 
to meet strict deadlines for conducting investigations.
    In the course of each investigation, the ITC is required to 
consult with and seek advice and information from the 
Department of Health and Human Services, the Department of 
Justice, the Federal Trade Commission, and other appropriate 
departments and agencies.
    In deciding whether an article has infringed a valid U.S. 
patent, the ITC applies the same statutory and decisional 
domestic patent law as would a district court. U.S. patent 
holders may file parallel actions in federal district court and 
the Commission. Respondents sued in both fora under the same 
underlying cause of action may obtain a stay of district court 
proceedings until the ITC determination becomes final.
    The Uruguay Round Agreements Act added a provision 
permitting respondents to raise counterclaims in section 337 
investigations. Such claims, however, would be immediately 
removed to district court and cannot be litigated at the ITC.
    Although damages are not an available remedy at the ITC as 
they are in district court, the ITC is empowered to issue 
limited exclusion orders, general exclusion orders, and cease 
and desist orders, which provide relief at the border. 
Specifically, if a violation of section 337 is found, the ITC 
must direct that the foreign articles be excluded from entry 
into the United States, unless it determines that such articles 
should not be excluded in consideration of the effect of 
exclusion on:
          (1) the public health and welfare;
          (2) competitive conditions in the U.S. economy;
          (3) the production of like or directly competitive 
        articles in the United States; and
          (4) U.S. consumers.
    The Uruguay Round Agreements Act added a provision 
establishing that the ITC is not permitted to issue a general 
exclusion order (i.e., an exclusion order that affects all 
shipments of the merchandise under investigation, as opposed to 
an order that affects merchandise from only those persons 
determined to be violating section 337) unless such a general 
order is necessary to prevent circumvention of specific orders, 
and there is a pattern of violation and identifying those 
persons responsible for the infringement is difficult.
    In appropriate circumstances, the ITC may issue temporary 
exclusion orders during the course of an investigation if it 
determines that there is reason to believe that there is a 
violation of section 337. In the event of a temporary exclusion 
order, entry is to be permitted only under bond. If petitioned 
by a complainant for issuance of a temporary exclusion order, 
the ITC must determine whether or not to issue such an order 
within 90 days after initiation of an investigation, with a 
possible extension of 60 days in more complicated cases. In 
such circumstances, the ITC may require the complainant to post 
a bond as a prerequisite for issuing an order. If the ITC later 
determines that the respondent has not violated these 
provisions, the bond may be forfeited to the respondent.
    In addition to or in lieu of issuing an exclusion order, 
the ITC may issue an appropriate cease and desist order to be 
served on the violating party or parties, unless it finds that 
such order should not be issued in consideration of the effect 
of such order on the same public interest factors listed above.
    The ITC may at any time, upon such notice and in such 
manner as it deems proper, modify or revoke any cease and 
desist order, and issue an exclusion order in its place. If a 
temporary cease and desist order is issued, the ITC may require 
the complainant to post a bond, which may be forfeited to the 
respondent if the ITC later determines that the respondent has 
not violated these provisions.
    Any person who violates a cease and desist order issued 
under this section shall be subject to a civil penalty of up to 
the greater of $100,000 per day or twice the domestic value of 
the articles entered or sold on such day in violation of the 
order.
    In the event that a person has been served with notice of 
proceedings and fails to appear to answer the complaint in 
cases where the complainant seeks relief limited solely to that 
person, the ITC must presume the facts alleged by the 
complainant to be true. If requested by the complainant, the 
ITC must issue an exclusion order and/or a cease and desist 
order against the person in default, unless it finds that such 
order should not be issued for the same public interest reasons 
listed above. Similarly, if no person appears to contest the 
investigation and violation is established, the ITC may issue a 
general exclusion order.
    The ITC may order seizure and forfeiture of goods subject 
to an exclusion order if an attempt has been made to import the 
goods and the owner or importer has been notified that a 
further attempt to import the goods would lead to seizure and 
forfeiture.

Presidential and judicial review

    Following an ITC determination of a violation of section 
337, the President may, within 60 days after receiving 
notification, disapprove the ITC determination for ``policy 
reasons.'' The statute does not specify what types of policy 
reasons may provide the basis for disapproval. Upon 
presidential disapproval, actions taken by the ITC cease to 
have effect. If the President does not disapprove the ITC 
determination, or if he approves it, then the ITC determination 
becomes final. Any person adversely affected by a final ITC 
determination under section 337 may appeal the determination to 
the U.S. Court of Appeals for the Federal Circuit.

                 Import Relief (Safeguard) Authorities


         Sections 201-204 of the Trade Act of 1974, as amended


Background

    Chapter 1 of title II (sections 201-204) of the Trade Act 
of 1974,\33\ as amended by section 1401 of the Omnibus Trade 
and Competitiveness Act of 1988,\34\ and sections 301-304 of 
the Uruguay Round Agreements Act,\35\ sets forth the authority 
and procedures for the President to take action, including 
import relief, to facilitate efforts by a domestic industry 
which has been seriously injured by imports to make a positive 
adjustment to import competition.
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    \33\ 19 U.S.C. 2251-2254.
    \34\ Public Law 100-418, approved August 23, 1988. The 1988 
amendments significantly rearranged chapter 1 of title II of the Trade 
Act of 1974 and added a new section 204. Prior to these amendments, the 
subject matter contained in sections 201-204 was found in sections 201-
203 of the Trade Act.
    \35\ Public Law 103-465, approved December 8, 1994. Minor 
amendments were also made by sections 315 and 317 of the North American 
Free Trade Agreement Implementation Act, Public Law 103-182, approved 
December 8, 1993.
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    From the outset of the trade agreements program in 1934, 
U.S. policy of seeking liberalization of trade barriers has 
been accompanied by recognition that difficult economic 
adjustment problems could result for particular sectors of the 
economy and, if serious injury results from increased 
competition by not necessarily unfairly traded imports, then 
domestic industries should be provided a period of relief to 
allow them to adjust to new conditions of trade. Beginning with 
bilateral trade agreements in the early 1940's, U.S. trade 
agreements, and eventually U.S. domestic law, have provided for 
a so-called ``escape clause'' or ``safeguard'' mechanism for 
import relief. This mechanism, while amended over the years, 
has provided authority for the President to withdraw or modify 
concessions and impose duties or other restrictions for a 
limited period of time on imports of any article which causes 
or threatens serious injury to the domestic industry producing 
a like or directly competitive article, following an 
investigation and determination by the U.S. International Trade 
Commission (ITC) (formerly the U.S. Tariff Commission).
    Under this basic trade agreements authority in section 350 
of the Tariff Act of 1930, the President issued three executive 
orders setting forth procedures and criteria for escape-clause 
relief, which governed from 1947 to 1951. Section 7 of the 
Trade Agreement Extension Act of 1951 contained the first 
statutory procedure and criteria for escape-clause action, 
which governed from 1951 until replaced by sections 301, 351 
and 352 of the Trade Expansion Act of 1962. The 1962 
provisions, which also introduced the concept of trade 
adjustment assistance (see separate section), were repealed and 
replaced by sections 201-203 of the Trade Act of 1974. In 1988, 
the 1974 provisions were rewritten to place a greater emphasis 
on the responsibility of domestic industry to use the relief 
period to undertake positive adjustment.
    Primarily at U.S. insistence, an escape clause (safeguard) 
provision modeled after language in the 1947 executive order 
was included in article XIX of the original General Agreement 
on Tariffs and Trade (GATT 1947). As a result of the GATT 
Uruguay Round of Multilateral Trade Negotiations, which 
resulted in the Agreement Establishing the World Trade 
Organization, GATT 1947 was replaced by GATT 1994. Article XIX 
was not changed in GATT 1994.\36\ In the course of the 
negotiations, GATT members negotiated a new Agreement on 
Safeguards, which provides rules for the application of article 
XIX of GATT 1994. The rules provide for, among other things, 
greater transparency in procedures and limitations on the 
duration of relief measures. However, in a departure from GATT 
1947 article XIX, which authorized retaliation by members 
adversely affected by the measure when appropriate compensation 
was not forthcoming, the Agreement provides that a member 
country may not exercise its right to take retaliatory action 
during the first 3 years that a safeguard measure is in effect, 
provided that the safeguard measure resulted from an absolute 
increase in imports and otherwise conforms to the Agreement.
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    \36\ The language of GATT article XIX is as follows: ``If, as a 
result of unforeseen developments and of the effect of the obligations 
incurred by a contracting party under this agreement, including tariff 
concessions, any product imported into the territory of that 
contracting party in such increased quantities and under such 
conditions as to cause or threaten serious injury to domestic producers 
in that territory of like or directly competitive products, the 
contracting party shall be free, in respect of such product and to the 
extent and for such time as may be necessary to prevent such injury, to 
suspend the obligation in whole or in part or to withdraw or modify the 
concession.''
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World Trade Organization (WTO) panel determinations

    By Presidential Proclamation 7103 of May 30, 1998, the 
United States imposed a Safeguard Measure in the form of a 
quantitative limitation on imports of wheat gluten from the 
European Union (EU). The EU challenged the imposition of the 
safeguard measure, claiming that it violated Articles 2.1 and 4 
of the Agreement on Safeguards and Article XIX:1(a) of the GATT 
1994. A WTO panel was formed on July 25, 1999. On July 31, 
2000, the panel issued a ruling in favor of the EU. 
Specifically, the panel found that the causation analysis 
applied by the ITC violated U.S. obligations under Articles 2.1 
and 4 of the safeguards Agreement because it did not ensure 
that injury caused by other factors was not attributed to 
imports. The panel also found the ITC's exclusion of imports 
from Canada (a NAFTA partner) from the application of the 
safeguard measure after imports from all sources were included 
in the investigation for the purposes of determining serious 
injury caused by increased imports to violate U.S. obligations 
under Articles 2.1 and 4 of the Safeguards Agreement. In 
addition, the panel found that the United States violated 
Articles 12.1(b) and 12.3 of the Safeguards Agreement by 
failing to: (1) notify immediately the initiation of the 
investigation and the finding of serious injury; (2) provide 
adequate opportunity for prior consultations on the safeguard 
measure; and (3) endeavor to maintain a substantially 
equivalent level of concessions and other obligations to that 
existing under GATT 1994 between it and the exporting Members 
that would be affected by such a measure. The United States 
filed its notice of appeal on September 26, 2000. On December 
22, 2000, the Appellate Body issued its report, reversing in 
part and affirming in part the panel decision. The Appellate 
Body reversed the panel's interpretation of Article 4.2(b) of 
the Safeguards Agreement that imports ``alone,'' `` in and of 
themselves,'' or ``per se,'' must be capable of causing 
``serious injury,'' as well as the Panel's conclusion on the 
issue of causation. However, the panel found that the United 
States acted inconsistently with its obligations under Article 
4.2(b) of the Safeguards Agreement because the ITC's causation 
analysis did not ensure that injury caused by other factors was 
not attributed to imports. The Appellate Body also reversed the 
panel's finding on immediate notification, finding that the 
United States did not act inconsistently with its obligations 
under Article 12.1(c) of the Safeguards Agreement.
    On July 22, 1999, the United States imposed a safeguard 
measure on imports of lamb meat from Australia and New Zealand. 
A WTO panel was formed on November 18, 1999, at the request of 
Australia and New Zealand, which argued that the safeguard 
measure violated U.S. obligations under GATT 1994 and the 
Agreement on Safeguards. The panel issued its report on 
December 14, 2000, finding certain aspects of the U.S. 
safeguard measure to be inconsistent with WTO rules. 
Specifically, the panel found that the United States acted 
inconsistently with Article XIX:1(a) of GATT 1994 by failing to 
demonstrate as a matter of fact the existence of ``unforeseen 
developments.'' In addition, the panel found that the United 
States acted inconsistently with Article 4.1(c) of the 
Agreement on Safeguards because the ITC defined the domestic 
industry as including input producers (i.e., growers and 
feeders of live lamb) as producers of the like product at issue 
(i.e. lamb meat). The panel found that the United States also 
acted inconsistently with Article 4.1(c) of the Safeguards 
Agreement because the ITC failed to obtain data on producers 
representing a major proportion of the total domestic industry 
as defined by the investigation. The panel further found, 
similar to the panel ruling in the wheat gluten case (described 
above) which was subsequently overturned by the Appellate Body, 
that the causation analysis applied by the ITC violated U.S. 
obligations under Article 4.2(b) of the Agreement on Safeguards 
because it did not ensure that injury caused by other factors 
was not attributed to imports. The United States plans to 
appeal the panel's ruling.

Petitions and investigations

    An entity representative of an industry (including a trade 
association, firm, union or group of workers) may file a 
petition under section 202 of the Trade Act of 1974 with the 
ITC. The petition must include a statement describing the 
specific purposes for which action is being sought, which may 
include facilitating the orderly transfer of resources to more 
productive pursuits, enhancing competitiveness, or other means 
of adjustment to new conditions of competition. Alternatively, 
the President, U.S. Trade Representative, or the House 
Committee on Ways and Means or Senate Committee on Finance may 
request an investigation.
    Upon petition, request, or on its own motion, the ITC 
conducts an investigation ``to determine whether an article is 
being imported into the United States in such increased 
quantities as to be a substantial cause of serious injury, or 
the threat thereof, to the domestic industry producing an 
article like or directly competitive with the imported 
article.'' Substantial cause is defined as ``a cause which is 
important and not less than any other cause.''
    In making its determination, the Commission must take into 
account all relevant economic factors, including certain 
factors specified in the statute,\37\ and must consider the 
condition of the domestic industry over the course of the 
relevant business cycle. The Commission may determine to treat 
as the domestic industry: (1) only the portion or subdivision 
producing the like or directly competitive article of a 
producer of more than one article; and (2) only production 
concentrated in a major geographic area under certain 
circumstances. The Commission is required, to the extent 
information is available, in the case of a domestic producer 
which also imports, to treat as part of the domestic industry 
only the domestic production of such producer.
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    \37\ These factors include: with respect to serious injury, the 
significant idling of productive facilities in the industry, the 
inability of a significant number of firms to operate at a reasonable 
level of profit, and significant unemployment or underemployment within 
the industry; with respect to threat of serious injury, a decline in 
sales or market share, a higher and growing inventory (whether 
maintained by domestic producers, importers, wholesalers, or 
retailers), and a downward trend in production, profits, wages, 
productivity or employment (or increasing underemployment) in the 
domestic industry concerned; the extent to which firms in the domestic 
industry are unable to generate adequate capital to finance the 
modernization of their domestic plants and equipment, or are unable to 
maintain existing levels of expenditures for research and development, 
the extent to which the U.S. market is the focal point for the 
diversion of exports of the article concerned by reason of restraints 
on exports of such article to, or on imports of such article into, 
third country markets; and with respect to substantial cause, an 
increase in imports (either actual or relative to domestic production) 
and a decline in the proportion of the domestic producers. The presence 
or absence of any factor is not necessarily dispositive.
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    A public hearing is required during the course of the 
investigation. Whenever during the investigation the Commission 
has reason to believe increased imports are attributable in 
part to unfair trade practices, then it must promptly notify 
the agency administering the appropriate remedial law.
    Normally the ITC must make its injury determination within 
120 days of receipt of the petition or request. However, if the 
ITC determines that the investigation is extraordinarily 
complicated, it may take up to 30 additional days to make an 
injury determination. If the petition alleges that critical 
circumstances exist, the ITC must first determine, within 60 
days of receipt of a petition containing such an allegation, 
whether critical circumstances exist. The ITC begins the injury 
phase of its investigation only after it has made its 
determination with respect to critical circumstances. If the 
ITC makes an affirmative injury finding, then it must recommend 
the action that would address the injury and be the most 
effective in facilitating efforts by the domestic industry to 
make a positive adjustment; such recommended action must be 
either a tariff, tariff-rate quota, quantitative restriction, 
adjustment measures, or a combination thereof.
    The ITC's remedy recommendation and report must be 
submitted to the President within 180 days of the petition 
(within 240 days if critical circumstances are alleged). The 
report must also be made available to the public, and a summary 
of the report must be published in the Federal Register.

Adjustment plans and commitments

    Under title II, as amended, petitioners are encouraged to 
submit, at any time prior to the ITC injury determination, a 
plan to promote positive adjustment to import competition. The 
law provides that positive adjustment occurs when (1) the 
domestic industry is able to compete successfully with imports 
after actions taken under section 204 terminate, or the 
domestic industry experiences an orderly transfer of resources 
to other productive pursuits; and (2) dislocated workers in the 
industry experience an orderly transition to productive 
pursuits.
    The domestic industry may be considered to have made a 
positive adjustment to import competition even though the 
industry is not of the same size and composition as the 
industry at the time the investigation was initiated.
    Before submitting an adjustment plan, the petitioner and 
other members of the domestic industry that wish to participate 
may consult with the U.S. Trade Representative and other 
federal government officials for purposes of evaluating the 
adequacy of the proposals being considered for inclusion in the 
plan.
    In addition, during the ITC investigation, the ITC is 
required to seek information (on a confidential basis to the 
extent appropriate) on actions being taken, or planned to be 
taken, or both, by firms and workers in the industry to make a 
positive adjustment to import competition. Any party may 
individually submit to the ITC commitments regarding actions 
such party intends to take to facilitate positive adjustment to 
import competition.

Provisional relief

    Under section 202(d) of the Trade Act, the President may 
provide provisional relief in the case of imports of a 
perishable agricultural product, provided that the imported 
product has been the subject of ITC monitoring for at least 90 
days prior to the filing of the petition with the ITC and the 
ITC has made an affirmative preliminary determination. The ITC 
has 21 days from the date on which the petition is filed to 
make its determination and report any finding with respect to 
provisional relief, and the President has 7 days after 
receiving an ITC report containing an affirmative determination 
to determine what, if any, action to take.
    The Uruguay Round Agreements Act revised, both 
substantively and procedurally, the critical circumstances 
provision in section 202. Under the revised provisions, if 
critical circumstances are alleged in the petition, the ITC 
must, within 60 days of receipt of a petition containing such 
an allegation, determine whether critical circumstances exist 
and, if so, recommend an appropriate remedy to the President. 
The ITC would find critical circumstances to exist when it 
determines, on the basis of available information, that there 
is ``clear evidence'' that increased imports of an article are 
a substantial cause of serious injury, or the threat thereof, 
to the domestic industry, and ``delay in taking action . . . 
would cause damage to that industry that would be difficult to 
repair.'' After receiving a report containing an affirmative 
ITC determination, the President has 30 days in which to 
determine what, if any, action to take.
    Provisional relief is to take the form of an increase in, 
or imposition of, a duty on imports, if such form of relief is 
feasible and would prevent or remedy the serious injury. Such 
actions generally remain in effect pending completion of the 
full ITC investigation and transmission of the ITC's report. 
However, no provisional relief action may remain in effect for 
more than 200 days.

Presidential action

    Within 60 days of receiving an affirmative ITC 
determination and report, the President shall take all 
appropriate and feasible action within his power which he 
determines will facilitate efforts by the domestic industry to 
make a positive adjustment and will provide greater economic 
and social benefits than costs. Any import relief provided may 
not exceed the amount necessary to prevent or remedy the 
serious injury.
    In determining what action is appropriate, the President is 
required to consider a number of factors, including the 
adjustment plan (if any), individual commitments, probable 
effectiveness of action to promote positive adjustment, other 
factors related to the national economic interest, and the 
national security interest.
    The actions authorized to be taken by the President include 
an increase in or imposition of a duty, imposition of a tariff-
rate quota system, a modification or imposition of a 
quantitative restriction, implementation of one or more 
adjustment measures (including trade adjustment assistance), 
negotiation of agreements with foreign countries limiting the 
export from foreign countries and the import into the United 
States of an article, and any other action within his power.
    The President may take action under this title for an 
initial period of up to 4 years, and may extend such action, at 
a level not to exceed that previously in effect, one or more 
times. However, the total period of relief, including any 
extensions, may not exceed 8 years. As provided in section 311 
of the North American Free Trade Agreement Implementation 
Act,\38\ a relief action is not to apply to imports of an 
article when imported from Canada or Mexico unless imports of 
such article from such country account for a substantial share 
of imports of such article and contribute importantly to the 
serious injury or threat thereof.
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    \38\ Public Law 103-182, approved December 8, 1993, 19 U.S.C. 3371.
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    The Trade Policy Committee, chaired by the U.S. Trade 
Representative, is required to make a recommendation to the 
President as to what action the President should take. On the 
day the President takes action under this title, he must submit 
to Congress a document describing the action and the reasons 
for taking the action. If the action taken by the President 
differs from the action recommended by the ITC, the President 
shall state in detail the reasons for the difference. If the 
President decides that there is no appropriate and feasible 
action to take with respect to a domestic industry, the 
President is required to transmit to Congress on the day of 
such decision a document that sets forth in detail the reasons 
for the decision.
    Congress may adopt a joint resolution of disapproval within 
90 legislative days under the expedited procedures of section 
152 of the Trade Act if the President takes action which is 
different from that recommended by the ITC or if the President 
declines to take any action. Under these procedures, 
resolutions are referred to the House Committee on Ways and 
Means and the Senate Committee on Finance, which are subject to 
a motion to discharge if the resolution has not been reported 
within 30 legislative days. No amendments to the motion or to 
the resolution are in order. Within 30 days after enactment of 
such a resolution, the President must proclaim the relief 
recommended by the Commission.

Monitoring, modification, and termination of action

    If presidential action is taken, the ITC is required to 
monitor developments in the industry, including efforts by the 
domestic industry to adjust and, if the initial period or an 
extension of the action exceeds 3 years, submit a report on the 
results of such monitoring at the midpoint of the initial 
period or extension, as appropriate. The Commission is required 
to hold a public hearing in the course of preparing each such 
report.
    After receiving an ITC report on the results of such 
monitoring, the President may reduce, modify, or terminate 
action if either (1) the domestic industry requests it on the 
basis that it has made a positive adjustment, or (2) the 
President determines that changed circumstances warrant such 
reduction, modification, or termination. Upon request of the 
President, the ITC must advise the President as to the probable 
economic effects on the domestic industry of any proposed 
reduction, modification, or termination of action.
    Prior to the termination of relief, the ITC is required, at 
the request of the President or upon petition of the concerned 
industry, to conduct an investigation to determine whether the 
relief action continues to be necessary to prevent or remedy 
serious injury and whether there is evidence that the industry 
is making a positive adjustment to import competition. The ITC 
must hold a public hearing in the course of each such 
investigation and transmit its report to the President no later 
than 60 days before termination of the relief action, unless 
the President specifies a different date.
    After any action taken under this title has terminated, the 
ITC must evaluate the effectiveness of the action in 
facilitating positive adjustment by the domestic industry to 
import competition, and submit a report to the President and to 
the Congress within 180 days of the termination of the action.

Subsequent relief actions

    If relief was provided, no new relief action may be taken 
with respect to the same subject matter for a period of time 
equal to the period of import relief granted, or for 2 years, 
whichever is greater.
    However, in the case of an action that is in effect for 180 
days or less, the President may take a new action with respect 
to the same subject matter if at least 1 year has elapsed since 
the previous action went into effect and an action has not been 
taken more than twice in the 5-year period preceding the 
effective date of the new action.

Section 406 of the Trade Act of 1974: Market Disruption by Imports From 
                          Communist Countries

    Section 406 of the Trade Act of 1974 \39\ was established 
to provide a remedy against market disruption caused by imports 
from Communist countries. The provision applies to imports from 
any Communist country, irrespective of whether it has received 
or currently receives non-discriminatory most-favored-nation 
treatment. Enactment of section 406 resulted from concern that 
traditional remedies for unfair trade practices, such as the 
antidumping and countervailing duty laws, may be insufficient 
to deal with a sudden and rapid influx of substantial imports 
that can result from Communist country control of their pricing 
levels and distribution process.
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    \39\ Public Law 93-618, approved January 3, 1975, and amended by 
section 1411 of the Omnibus Trade and Competitiveness Act of 1988 
(Public Law 100-418), 19 U.S.C. 2436.
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    The provisions of section 406 of the Trade Act of 1974, as 
amended by the Omnibus Trade and Competitiveness Act of 1988, 
are in many ways similar to those under sections 201-203 of the 
Trade Act, except that section 406 provides a lower standard of 
injury causation and a faster relief procedure, and the 
investigation focuses on imports from a specific country.
    Under section 406(a), the ITC conducts investigations to 
determine whether imports of an article produced in a Communist 
country (any country dominated or controlled by communism) are 
causing market disruption with respect to a domestically 
produced article. Market disruption exists whenever imports of 
an article, like or directly competitive with an article 
produced by a domestic industry, are increasing rapidly so as 
to be a significant cause of material injury, or threat 
thereof, to such domestic industry. Imports are increasing 
rapidly if there has been a significant increase in imports, 
either actual or relative to domestic production, during a 
recent period of time. In making a determination of market 
disruption, the ITC is required to consider, among other 
factors, the volume of imports, the effect of imports on 
prices, the impact of imports on domestic producers, and 
evidence of disruptive pricing practices or other efforts to 
unfairly manage trade patterns.
    The ITC conducts such investigations at the request of the 
President or the U.S. Trade Representative, upon resolution of 
either the House Committee on Ways and Means or the Senate 
Committee on Finance, on its own motion, or upon the filing of 
a petition by an entity (including a trade association, firm, 
union, or a group of workers) which is representative of an 
industry. The Commission must complete its investigation within 
3 months including a public hearing.
    If the ITC finds that market disruption exists, it must 
also recommend to the President relief in the form of rates of 
duty or quantitative restrictions that will prevent or remedy 
such market disruption. The President then has 60 days to 
advise Congress as to what, if any, relief he will proclaim. 
Any import relief must be proclaimed within 15 days after the 
determination to provide it, except that the President has an 
additional 60 days to negotiate an orderly marketing agreement 
if he decides to provide relief in that form. Relief applies 
only to imports from the subject Communist country. Relief is 
limited to a maximum 5-year period subject to one renewal of up 
to 3 years.
    Section 406(c) authorizes the President, prior to an ITC 
determination, to take temporary emergency action with respect 
to imports from a Communist country whenever he finds that 
there are reasonable grounds to believe there is market 
disruption. When taking such action, the President must also 
request the Commission to conduct an investigation under 
section 406(a). Any emergency relief ceases to apply on the day 
the Commission makes a negative finding or on the effective 
date of action by the President following an affirmative ITC 
finding.

     Sections 421-423 of the Trade Act of 1974, as amended: Market 
       Disruption by Imports from the People's Republic of China

    Section 103 of Public Law 106-286, approved October 10, 
2000, authorizing the extension of permanent normal trade 
relations to the People's Republic of China created a new 
chapter of title IV of the Trade Act of 1974 to implement the 
anti-surge mechanism established under the U.S.-China Bilateral 
Trade Agreement, concluded on November 15, 1999. This provision 
was intended to replace section 406 of the Trade Act of 1974, 
which would no longer apply to China once that country joins 
the WTO.
    Section 421 of the new chapter permits the provision of 
relief to U.S. domestic industries and workers where products 
of Chinese origin are being imported in such increased 
quantities and under such conditions as to cause or threaten to 
cause market disruption to the domestic producers as a whole of 
like or directly competitive products. The relief is to be 
imposed only to the extent and for such period as the President 
considers necessary to prevent or remedy the market disruption. 
Procedures are modeled after Section 406, with certain 
modifications to conform to language of the bilateral trade 
agreement. U.S. industries or workers claiming injury due to 
import surges from China may file a petition with the ITC or 
the ITC can initiate an investigation at the request of the 
President or on motion of the House Ways and Means Committee or 
the Senate Finance Committee. According to the U.S.-China 
Agreement and under the legislation, market disruption occurs 
when subject imports ``are increasing rapidly, either 
absolutely or relatively, so as to be a significant cause of 
material injury or threat of material injury to the domestic 
industry.''
    In determining whether market disruption exists, the ITC 
considers objective factors, including: (1) the volume of 
imports of the product subject to the investigation; (2) the 
effect of imports of such product on prices in the United 
States of like or directly competitive articles, and (3) the 
effect of imports of such product on the domestic industry 
producing like or directly competitive articles. The presence 
or absence of any factor listed above is not necessarily 
dispositive of whether market disruption exists.
    Within 60 days after receipt of the petition, request or 
motion (90 days, where the petitioner alleges critical 
circumstances), the ITC is to make a determination as to 
whether the subject imports are causing or threatening market 
disruption. Not later than 20 days after the ITC makes an 
affirmative determination with respect to market disruption, 
the ITC is to issue a report to the President and to the USTR 
setting forth the reasons for its determination and 
recommendation(s) of actions necessary to prevent or remedy 
market disruption. Within twenty days, the USTR is to publish a 
notice of proposed action in the Federal Register, seeking 
views and evidence on the appropriateness of the proposed 
action and whether it would be in the public interest. The USTR 
is also required to hold a hearing on the proposed action.
    If the ITC's determination is affirmative with respect to 
market disruption, the President is required to request 
consultations with the Chinese to remedy the market disruption. 
If the United States and China are unable to reach agreement 
within the 60 day consultation period established in the 
bilateral agreement and under section 421, then the President 
is required to decide what action, if any, to take within 25 
days after the end of consultations. Any relief proclaimed is 
to become effective in 15 days. If the President determines 
that an agreement with China concluded under this section is 
not preventing or remedying the market disruption at issue, 
then the President is to initiate new consultations and 
proceedings under section 421. However, if China is not 
complying with the terms of the agreement entered into under 
the U.S.-China Bilateral Agreement, then the President is 
required to provide prompt relief consistent with the terms of 
the Bilateral Agreement.
    The entire period from petition to proclamation of relief 
is 150 days, which is identical to the duration under section 
406 of the Trade Act.
    Section 421 also establishes clear standards for the 
application of Presidential discretion in providing relief to 
injured industries and workers. If the ITC makes an affirmative 
determination on market disruption, there is a presumption in 
favor of providing relief. That presumption can be overcome 
only if the President finds that providing relief would have an 
adverse impact on the United States economy clearly greater 
than the benefits of such action, or, in extraordinary cases, 
that such action would cause serious harm to the national 
security of the United States.
    The provision also sets forth authority to the President to 
modify, reduce or terminate relief, as well an opportunity for 
the President to request a report from the ITC on the probable 
effects of such action. In addition, section 421 allows for 
extension of relief under certain circumstances.
    The President is authorized to provide a provisional 
safeguard in cases where ``delay would cause damage which it 
would be difficult to repair,'' as permitted under the U.S.-
China Bilateral Agreement. If such circumstances are alleged, 
the ITC is required to make a determination on critical 
circumstances and a preliminary determination on market 
disruption within 45 days of receipt of the petition, request, 
or motion. If those determinations are affirmative, the 
President is required to determine whether to provide such 
provisional relief within 20 days.
    Finally, section 422 implements a provision in the U.S.-
China Bilateral Agreement concerning trade diversion. That 
provision addresses circumstances in which a safeguard applied 
by a third country with respect to Chinese goods ``causes or 
threatens to cause significant diversions of trade'' into the 
United States. If, on the basis of the monitoring results 
provided by the Customs Service and other reasonably available 
relevant evidence, the ITC determines that an action by another 
WTO Member threatens or causes significant trade diversion, the 
USTR is required to request consultations with China and/or the 
Member imposing the safeguard. If, as provided in the U.S.-
China Bilateral Agreement, consultations fail to lead to an 
agreement to address the trade diversion within 60 days, the 
President is required to determine, within 40 days after 
consultations end, what action, if any, to take to prevent or 
remedy the trade diversion. The total time from petition to 
relief under the trade diversion provision is 150 days. Section 
422 also requires the ITC to examine changes in imports into 
the United States from China since the time that the WTO Member 
commenced the investigation that led to a request for 
consultations.
    The product-specific safeguard is available for 12 years 
after China's accession to the WTO.

  Section 1102 of the Trade Agreements Act of 1979: Public Auction of 
                            Import Licenses

    Section 1102 of the Trade Agreements Act of 1979 authorizes 
the President to sell import licenses by public auction, under 
such terms and conditions as the President deems appropriate. 
Any regulations prescribed under this authority must, to the 
extent practicable and consistent with efficient and fair 
administration, ensure against inequitable sharing of imports 
by a relatively small number of the larger importers.
    Import licenses which are potentially subject to this 
auction authority are identified in section 1102 by the law 
authorizing the import restriction. For example, import 
licenses used to administer a quantitative restriction under 
the escape clause (section 203 of the Trade Act of 1974), the 
market disruption clause (section 406 of the Trade Act of 1974) 
or section 301 of the Trade Act of 1974 may be sold by public 
auction. Any quantitative import restriction imposed under the 
International Emergency Economic Powers Act or the Trading With 
the Enemy Act may also be administered by an auctioned import 
license. Certain agricultural import quotas, however (such as 
certain meat quotas, cheese quotas, and dairy quotas) are 
exempt from the auction authority and therefore may not be 
administered by means of auctioned licenses.

                      Trade Adjustment Assistance


 Chapters 2, 3, and 5 of Title II of the Trade Act of 1974, as amended

    The trade adjustment assistance (TAA) programs were first 
established under the Trade Expansion Act of 1962 for the 
purpose of assisting in the special adjustment problems of 
workers and firms dislocated as a result of a federal policy of 
reducing barriers to foreign trade. As a result of limited 
eligibility and usage of the programs, criteria and benefits 
were expanded under title II of the Trade Act of 1974 (Public 
Law 93-618). The Omnibus Budget Reconciliation Act of 1981 
(OBRA) (Public Law 97-35), reformed the program for workers as 
proposed by the Administration. The amendments, particularly in 
program eligibility and benefits, were intended to reduce 
program cost significantly and to shift the focus of TAA from 
income compensation for temporary layoffs to return-to-work 
through training and other adjustment measures for the long-
term or permanently unemployed. The OBRA also made relatively 
minor modifications in the firm program. Both programs were 
extended at that time for 1 year, to terminate on September 30, 
1983.
    Public Law 98-120, a bill to amend the International Coffee 
Agreement Act of 1980, approved on October 12, 1983, extended 
the worker and firm TAA programs for 2 years, until September 
30, 1985. Sections 2671-2673 of the Deficit Reduction Act of 
1984 (Public Law 98-369) amended the program for workers to 
increase the availability of worker training allowances and the 
level of job search and relocation benefits, and amended the 
program for firms to increase the availability of industrywide 
technical assistance.
    The worker and firm TAA programs were further extended 
under temporary legislation in the 99th Congress until December 
19, 1985. The Consolidated Omnibus Budget Reconciliation Act of 
1985 (COBRA) (Public Law 99-272), approved April 7, 1986, 
reauthorized the TAA programs for workers and firms for 6 years 
retroactively from December 19, 1985, until September 30, 1991, 
with amendments.
    Sections 1421-1430 of the Omnibus Trade and Competitiveness 
Act of 1988 (OTCA) (Public Law 100-418), enacted on August 23, 
1988, made significant amendments in the worker TAA program, 
particularly concerning the eligibility criteria for cash 
benefits, funding, and administration. A training requirement 
as a condition for income support to encourage and enable 
workers to obtain early reemployment became effective as of 
November 21, 1988. This replaced a 1986 amendment that 
instituted a job-search requirement as a condition for 
receiving cash benefits. The amendments also expanded TAA 
eligibility coverage of workers and firms, contingent upon the 
imposition of an import fee to fund program costs. The OTCA 
extended TAA program authorization for an additional 2 years 
until September 30, 1993.
    Section 136 of the Customs and Trade Act of 1990, (Public 
Law 101-382), approved on August 20, 1990, extended the 
completion and reporting period for the supplemental wage 
allowance demonstration projects for workers required by the 
1988 amendments. Section 106 of Public Law 102-318, approved 
July 3, 1992, to extend the emergency unemployment compensation 
program, provided for weeks of active military duty in a 
reserve status (including service during Operation Desert 
Storm) to qualify toward the minimum number of weeks of prior 
employment required for TAA eligibility.
    Section 13803 of the Omnibus Budget Reconciliation Act 
(OBRA 1993) of 1993, Public Law 103-66, approved August 10, 
1993, reauthorized the TAA programs for workers and firms for 
an additional 5 years through fiscal year 1998, with assistance 
to terminate on September 30, 1998. Section 13803 of the OBRA 
1993 also reduced the level of the ``cap'' on training 
entitlement funding from $80 million to $70 million for fiscal 
year 1997 only.
    Sections 501-506 of the North American Free Trade Agreement 
(NAFTA) Implementation Act, Public Law 103-182, approved 
December 8, 1993, set forth the ``NAFTA Worker Security Act,'' 
establishing the NAFTA transitional adjustment assistance 
program, effective January 1, 1994 through September 30, 1998, 
for workers as a new subchapter D (section 250) under chapter 2 
of title II of the Trade Act of 1974.
    Renewal of the TAA programs for workers and firms, as well 
as the NAFTA-related TAA program, through June 30, 1999 was 
contained in section 1012 of the Omnibus Appropriations Act for 
Fiscal Year 1999.\40\ Section 1012 also reduced the level of 
the ``cap'' on NAFTA-related training entitlement funding from 
$30 million per fiscal year to $15 million for the period 
between October 1, 1998 and June 30, 1999.
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    \40\ Public Law 105-277, approved October 21, 1998.
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    Section 702 of the Consolidated Appropriations Act for 
Fiscal Year 2000 \41\ reauthorized the TAA programs for workers 
and firms, including the NAFTA-related TAA program, through 
September 30, 2001. Section 702 also restored the ``cap'' on 
NAFTA-related training entitlement funding to $30 million per 
fiscal year.
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    \41\ Public Law 106-113, approved November 29, 1999.
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                        TAA Program for Workers

    TAA for workers under sections 221 through 250 of the Trade 
Act of 1974, as amended, consists of trade readjustment 
allowances (TRAs), employment services, training and additional 
TRAs allowances while in training, and job search and 
relocation allowances for certified and otherwise qualified 
workers. The program is administered by the Employment and 
Training Administration (ETA) of the Department of Labor 
through state agencies under cooperative agreements between 
each state and the Secretary of Labor. ETA processes petitions 
and issues certifications or denials of petitions by groups of 
workers for eligibility to apply for TAA. The state agencies 
act as federal agents in providing program information, 
processing applications, determining individual worker 
eligibility for benefits, issuing payments, and providing 
reemployment services and training opportunities.

Certification requirements

    A two-step process is involved in the determination of 
whether an individual worker will receive TAA: (1) 
certification by the Secretary of Labor of a petitioning group 
of workers in a particular firm as eligible to apply; and (2) 
approval by the state agency administering the program of the 
application for benefits of an individual worker covered by a 
certification.
    The process begins by a group of three or more workers, 
their union, or authorized representative filing a petition 
with the ETA for certification of group eligibility. To certify 
a petitioning group of workers as eligible to apply for 
adjustment assistance, the Secretary must determine that three 
conditions are met:
          (1) a significant number or proportion of the workers 
        in the firm or subdivision of the firm have been or are 
        threatened to be totally or partially laid off;
          (2) sales and/or production of the firm or 
        subdivision have decreased absolutely; and
          (3) increased imports of articles like or directly 
        competitive with articles produced by the firm or 
        subdivision of the firm have ``contributed 
        importantly'' to both the layoffs and the decline in 
        sales and/or production.
    The OTCA amendments expanded the potential eligibility 
coverage to include workers in any firm or subdivision of a 
firm that engages in exploration or drilling for oil or natural 
gas.
    The Secretary is required to make the eligibility 
determination within 60 days after a petition is filed. A 
certification of eligibility to apply for TAA covers workers 
who meet the requirements and whose last total or partial 
separation from the firm or subdivision before applying for 
benefits occurred within 1 year prior to the filing of the 
petition.
    State agencies must give written notice by mail to each 
worker to apply for TAA where it is believed the worker is 
covered by a certification of eligibility and also must publish 
notice of each certification in newspapers of general 
circulation in areas where certified workers reside. State 
agencies must also advise each adversely affected worker, at 
the time that worker applies for UI, of TAA program benefits as 
well as the procedures, deadlines, and qualifying requirements 
for applying. State agencies must advise each such worker to 
apply for training before or at the same time the worker 
applies for TRA benefits, and promptly interview each certified 
worker and review suitable training opportunities available.

Qualifying requirements for trade readjustment allowances

    In order to receive entitlement to payment of a TAA for any 
week of unemployment, an individual must be an adversely 
affected worker covered by a certification, file an application 
with the State agency, and meet the following qualifying 
requirements:
          (1) The worker's first qualifying separation from 
        adversely affected employment occurred within the 
        period of the certification applicable to that worker, 
        i.e, on or after the ``impact date'' in the 
        certification (the date on which total or partial 
        layoffs in the firm or subdivision thereof began or 
        threatened to begin, but never more than 1 year prior 
        to the date of the petition), within 2 years after the 
        date the Secretary of Labor issued the certification 
        covering the worker, and before the termination date 
        (if any) of the certification.
          (2) The worker was employed during the 52-week period 
        preceding the week of the first qualifying separation 
        at least 26 weeks at wages of $30 or more per week in 
        adversely affected employment with a single firm or 
        subdivision of a firm. A week of unemployment includes 
        the week in which layoff occurs and up to 7 weeks of 
        employer-authorized vacation, sickness, injury, 
        maternity, or military leave, or service as a full-time 
        union representative. Weeks of disability covered by 
        workmen's compensation and, as amended in 1992, weeks 
        of active duty in a military reserve status may also 
        count toward the 26-week minimum.
          (3) The worker was entitled to unemployment insurance 
        (UI), has exhausted all rights to any UI entitlement, 
        including any extended benefits (EB) or federal 
        supplemental compensation (FSC) (if in existence), and 
        does not have an unexpected waiting period for any UI.
          (4) The worker must not be disqualified with respect 
        to the particular week of unemployment for EB by reason 
        of the work acceptance and job search requirements 
        under section 202(a)(3) of the Federal-State Extended 
        Unemployment Compensation Act of 1970. All TRA 
        claimants in all states are subject to the provisions 
        of the EB ``suitable work'' test under that Act (i.e., 
        must accept any offer of suitable work, actively engage 
        in seeking work, and register for work) after the end 
        of their regular UI benefit period as a precondition 
        for receiving any weeks of TRA payments. The EB work 
        test does not apply to workers enrolled or 
        participating in a TAA-approved training program; the 
        test does apply to workers for whom TAA-approved 
        training is certified as not feasible or appropriate.
          (5) The worker must be enrolled in, or have completed 
        following separation from adversely affected employment 
        within the certification period, a training program 
        approved by the Secretary of Labor in order to receive 
        basic TAA payments, unless the Secretary has determined 
        and submitted a written statement to the individual 
        worker certifying that approval of training is not 
        ``feasible or appropriate'' (e.g., training is not 
        available that meets the criteria for approval, funding 
        is not available to pay the full training costs, there 
        is a reasonable prospect that the worker will be 
        reemployed by the firm from which he was separated). No 
        cash benefits may be paid to a worker who, without 
        justifiable cause, has failed to begin participation or 
        has ceased participation in an approved training 
        program until the worker begins or resumes 
        participation, or to a worker whose waiver of 
        participation in training is revoked in writing by the 
        Secretary.
    This training requirement to encourage and enable workers 
to obtain early reemployment became effective under the OTCA 
amendments as of November 21, 1988; this 1988 amendment 
replaced a 1986 amendment that instituted a job search 
requirement as a condition for receiving cash benefits.

Cash benefit levels and duration

    A worker is entitled to TRA payments for weeks of 
unemployment beginning the later of (a) the first week 
beginning more than 60 days after the filing date of the 
petition that resulted in the certification under which the 
worker is covered (i.e., weeks following the statutory deadline 
for certification), or (b) the first week after the worker's 
first total qualifying separation.
    The TRA cash benefit amount payable to a worker for a week 
of total unemployment is equal to, and a continuation of, the 
most recent weekly benefit amount of UI payable to that worker 
preceding that worker's first exhaustion of UI following the 
worker's first total qualifying separation under the 
certification, reduced by any federal training allowance and 
disqualifying income deductible under UI law.
    The maximum amount of basic TRA benefits payable to a 
worker for the period covered by any certification is 52 times 
the TRA payable for a week of total unemployment minus the 
total amount of UI benefits to which the worker was entitled in 
the benefit period in which the first qualifying separation 
occurred (e.g., a worker receiving 39 weeks of UI regular and 
extended benefits could receive a maximum 13 weeks of basic TRA 
benefits). UI and TRA payments combined are limited to a 
maximum 52 weeks in all cases involving extended compensation 
benefits (i.e., a worker who received 52 or more weeks of 
unemployment benefits would not be entitled to basic TRA). TRA 
benefits are not payable to workers participating in on-the-job 
training.
    The eligibility period for collecting basic TRA is the 104-
week period that immediately follows the week in which a total 
qualifying separation occurs. If the worker has a subsequent 
total qualifying separation under the same certification, the 
eligibility period for basic TRA moves from the prior 
eligibility period to 104 weeks after the week in which the 
subsequent total qualifying separation occurs.
    A worker may receive up to 26 additional weeks of TRA 
benefits after collecting basic benefits (up to a total maximum 
of 78 weeks) if that worker is participating in approved 
training. To receive the additional benefits, the worker must 
apply for the training program within 210 days after 
certification or first qualifying separation, whichever date is 
later. Additional benefits may be paid only during the 26-week 
period that follows the last week of entitlement to basic TRA, 
or that begins with the first week of training if the training 
begins after the exhaustion of basic TRA.
    A worker participating in approved training continues to 
receive basic and additional TRA payments during breaks in such 
training if the break does not exceed 14 days, if the worker 
was participating in the training before the beginning of the 
break, resumes participation in the training after the break 
ends, and the break is provided for in the training schedule. 
Weeks when TRA is not payable because of this break provision 
count against the eligibility periods for both basic and 
additional TRA.

Training and other employment services, job research and relocation 
        allowances

    Training and other employment services and job search and 
relocation allowances are available through state agencies to 
certified workers whether or not they have exhausted UI 
benefits and become eligible for TRA payments.
    Employment services consist of counseling, vocational 
testing, job search and placement, and other supportive 
services, provided for under any other federal law.
    Training, preferably on-the-job, shall be approved for a 
worker if the following six conditions are met:
          (1) there is no suitable employment available;
          (2) the worker would benefit from appropriate 
        training;
          (3) there is a reasonable expectation of employment 
        following training completion;
          (4) approved training is reasonably available from 
        government agencies or private sources;
          (5) the worker is qualified to undertake and complete 
        such training; and
          (6) such training is suitable for the worker and 
        available at a reasonable cost.
    If training is approved, the worker is entitled to payment 
of the costs from the Secretary directly or through a voucher 
system, unless they have been paid or are reimbursable under 
another federal law. On-the-job training costs are payable only 
if such training is not at the expense of currently employed 
workers. The 1988 amendments added remedial education as a 
separate and distinct approvable training program.
    The OTCA amendments converted training from an entitlement 
to the extent appropriated funds were available, to an 
entitlement without regard to the availability of funds to pay 
the training costs. As of the OTCA amendments, approved 
training is an entitlement in any case where the six criteria 
for approval are reasonably met, up to an $80 million statutory 
ceiling on annual fiscal year training costs (including job 
search and relocation allowances and subsistence payments) 
payable from TAA funds. Up to this limit workers are entitled 
to have the costs of approved training paid on their behalf. If 
the Secretary foresees that the $80 million ceiling would be 
exceeded in any fiscal year, the Secretary will decide how 
remaining TAA funds shall be apportioned among the states for 
the balance of that year.
    As a result of the OTCA amendments, costs of approved TAA 
training may be paid solely from TAA funds, solely from other 
federal or state programs or private funds, or from a mix of 
TAA and public or private funds, except if the worker in the 
case of a non-governmental program would be required to 
reimburse any portion of the costs from TAA funds. Duplicate 
payment of training costs is prohibited, and workers are not 
entitled to payment of training costs from TAA funds to the 
extent these costs are paid or shared from other sources. 
Training may still be approved if the fiscal year TAA funding 
entitlement limit is reached, provided the training costs are 
paid from outside sources.
    Supplemental assistance is available to defray reasonable 
transportation and subsistence expenses for separate 
maintenance when training is not within the worker's commuting 
distance, equal to the lesser of actual per diem expenses or 50 
percent of the prevailing federal per diem rate for subsistence 
and prevailing mileage rates under federal regulations for 
travel expenses.
    Job search allowances are available to certified workers 
who cannot obtain suitable employment within their commuting 
area, are totally laid off, and who apply within 1 year after 
certification or last total layoff, whichever is later, or 
within 6 months after concluding training. The allowance for 
reimbursement is equal to 90 percent of necessary job search 
expenses, based on the same increased supplemental assistance 
rates described above, up to a maximum amount of $800. The 
Secretary of Labor is required to reimburse workers for 
necessary expenses incurred to participate in an approved job 
search program.
    Relocation allowances are available to certified workers 
totally laid off at the time of relocation who have been able 
to obtain an offer of or actual suitable employment only 
outside their commuting area, who apply within 14 months after 
certification or last total layoff, whichever is later, or 
within 6 months after concluding training, and whose relocation 
takes place within 6 months after application of completion of 
training. As amended in 1981 and 1984, the allowance is equal 
to 90 percent of reasonable and necessary expenses for 
transporting the worker, family, and household effects, based 
on the same increased supplemental assistance rates described 
above, plus a lump sum payment of three times the worker's 
average weekly wage up to a maximum amount of $800.

Funding

    Federal funds, as an appropriated entitlement from general 
revenues under the Federal Unemployment Benefit Account (FUBA) 
in the Department of Labor, cover the portion of the worker's 
total entitlement represented by the continuation of UI benefit 
levels in the form of TRA payments, as well as payments for 
training and job search and relocation allowances, and state-
related administrative expenses. Funds made available under 
grants to states defray expenses of any employment services and 
other administrative expenses. For fiscal year 2001, $342.4 
million has been appropriated for trade readjustment allowances 
and related administrative expenses. Funding for training, job 
search and relocation allowances, and related expenses is an 
annual appropriated entitlement under the Training and 
Employment Services account of the Department of Labor.
    The states are reimbursed from Treasury general revenues 
for benefit payments and other costs incurred under the 
program. A penalty under section 239 of the Trade Act of 1974 
provides for reduction by 15 percent of the credits for state 
unemployment taxes which employers are allowed against their 
liability for federal unemployment tax if a state has not 
entered into or has not fulfilled its commitments under a 
cooperative agreement.

                       NAFTA Worker Security Act

    Subchapter D of chapter 2 (section 250) of title II of the 
Trade Act of 1974 establishes a NAFTA transitional adjustment 
assistance program for workers who may be adversely impacted by 
the NAFTA. Import-impacted workers may also petition for 
assistance under TAA, but cannot obtain benefits under both 
programs.
    A group of workers (including workers in any agricultural 
firm or subdivision of an agricultural firm) shall be certified 
as eligible to apply for adjustment assistance under subchapter 
D if the Secretary determines that a significant number or 
proportion of the workers in the firm or subdivision of the 
firm have become or are threatened to become totally or 
partially separated, and either:
          (1) Sales and/or production of the firm or 
        subdivision have decreased absolutely, imports from 
        Mexico or Canada of articles like or directly 
        competitive with articles produced by such firm or 
        subdivision have increased, and the increase in imports 
        contributed importantly to the workers' separation or 
        threat of separation and to the decline in the sales or 
        production of the firm or subdivision; or
          (2) There has been a shift in production by the 
        workers' firm or subdivision to Mexico or Canada of 
        articles like or directly competitive with articles 
        produced by the firm or subdivision.
    A group of workers or their union or other duly authorized 
representative may file a petition for certification of 
eligibility to apply for adjustment assistance under subchapter 
D with the governor of the state in which the worker's firm or 
subdivision is located. Upon receipt of the petition, the 
governor must notify the Secretary of Labor. Within 10 days 
thereafter, the governor must make a preliminary finding as to 
whether the petition meets the certification criteria and 
transmit the petition, together with a statement of the finding 
and reasons therefor, to the Secretary for action. If the 
preliminary finding is affirmative, the governor will ensure 
that rapid response and basic readjustment services authorized 
under other federal law are made available to the workers.
    Within 30 days after receiving the petition, the Secretary 
must determine whether the petition meets the certification 
criteria. Upon an affirmative determination, the Secretary will 
issue to workers covered by the petition a certification of 
eligibility to apply for comprehensive assistance. Upon denial 
of certification, the Secretary will review the petition to 
determine if the workers meet the requirements of the TAA 
program for certification.
    Certified workers under the NAFTA program receive 
employment services, training, trade readjustment allowances, 
and job search and relocation allowances in the same manner and 
to the same extent as workers covered under a TAA 
certification, with the following exceptions: (1) the total 
amount of payments for training costs for any fiscal year do 
not exceed $30 million; (2) with respect to TRA benefits, the 
authority of the Secretary of Labor to waive the training 
requirement does not apply with respect to payments under 
subchapter D; and (3) to receive TRA benefits, the worker must 
be enrolled in a training program approved by the Secretary by 
the later of the last day of the 16th week of the worker's 
initial UI benefit period or the last day of the 6th week after 
the week in which the Secretary issues a certification covering 
the worker. In extenuating circumstances, the Secretary may 
extend the time for enrollment for not more than 30 days.
    The NAFTA program took effect on January 1, 1994, the date 
the NAFTA entered into force for the United States. No worker 
can be certified as eligible to receive assistance under 
subchapter D whose last total or partial separation occurred 
before January 1, except for those workers whose last layoff 
occurred after December 8 (the date of enactment of the NAFTA 
Implementation Act) and before January 1 who would otherwise be 
eligible to receive assistance under subchapter D.
    For fiscal year 2001, $64.15 million has been appropriated 
for NAFTA trade adjustment assistance.

                         TAA Program for Firms

    Sections 251 through 264 of the Trade Act of 1974, as 
amended, contain the procedures, eligibility requirements, 
benefits and their terms and conditions, and administrative 
provisions of the TAA program for firms adversely impacted by 
increased import competition. The program is administered by 
the Economic Development Administration within the Department 
of Commerce. Amendments in 1986 under the COBRA eliminated 
financial assistance (direct loan or loan guarantee) benefits, 
increased government participation in technical assistance, and 
expanded the criteria for firm certification.
    Program benefits consist exclusively of technical 
assistance for petitioning firms which qualify under a two-step 
procedure: (1) certification by the Secretary of Commerce that 
the petitioning firm is eligible to apply, and (2) approval by 
the Secretary of Commerce of the application by a certified 
firm for benefits, including the firm's proposal for economic 
adjustment.
    To certify a firm as eligible to apply for adjustment 
assistance, the Secretary must determine that three conditions 
are met:
          (1) a significant number or proportion of the workers 
        in the firm have been or are threatened to be totally 
        or partially laid off;
          (2) sales and/or production of the firm have 
        decreased absolutely, or sales and/or production that 
        accounted for at least 25 percent of total production 
        or sales of the firm during the 12 months preceding the 
        most recent 12-month period for which data are 
        available have decreased absolutely; and
          (3) increased imports of articles like or directly 
        competitive with articles produced by the firm have 
        ``contributed importantly'' to both the layoffs and the 
        decline in sales and/or production.
    The 1988 amendments expanded potential eligibility coverage 
of the program to include firms that engage in exploration or 
drilling for oil or natural gas. Unlike the worker program, 
this extension applies only prospectively after August 23, 
1988.
    A certified firm may file an application with the Secretary 
of Commerce for trade adjustment assistance benefits at any 
time within 2 years after the date of the certification of 
eligibility. The application must include a proposal by the 
firm for its economic adjustment. The Secretary may furnish 
technical assistance to the firm in preparing its petition for 
certification and/or in developing a viable economic adjustment 
proposal.
    The Secretary approves the firm's application for 
assistance only if he determines that its adjustment proposal 
(a) is reasonably calculated to make a material contribution to 
the economic adjustment of the firm; (b) gives adequate 
consideration to the interests of the workers in the firm; and 
(c) demonstrates that the firm will make all reasonable efforts 
to use its own resources for economic development.

Benefits

    Technical assistance may be given to implement the firm's 
economic adjustment proposal in addition to, or in lieu of, 
precertification assistance or assistance in developing the 
proposal. It may be furnished through existing government 
agencies or through private individuals, firms, and 
institutions (including private consulting services), or by 
grants to intermediary organizations, including regional TAA 
Centers. As amended by the COBRA, the federal government may 
bear the full cost of technical assistance to a firm in 
preparing its petition for certification. However, the federal 
share cannot exceed 75 percent of the cost of assistance 
furnished through private individuals, firms, or institutions 
for developing or implementing an economic adjustment proposal. 
Grants may be made to intermediate organizations to defray up 
to 100 percent of their administrative expenses in providing 
technical assistance.
    The Secretary of Commerce also may provide technical 
assistance of up to $10 million annually per industry to 
establish industrywide programs for new product or process 
development, export development, or other uses consistent with 
adjustment assistance objectives. The assistance may be 
furnished through existing agencies, private individuals, 
firms, universities, and institutions, and by grants, 
contracts, or cooperative agreements to associations, unions, 
or other non-profit organizations of industries in which a 
substantial number of firms or workers have been certified.

Funding

    Funds to cover all costs of the program are subject to 
annual appropriations to the EDA of the Department of Commerce 
from general revenues. For fiscal year 2001, $10.5 million was 
appropriated for the program.
                Chapter 3: OTHER LAWS REGULATING IMPORTS

  Authorities To Restrict Imports of Agricultural and Textile Products

        Section 204 of the Agricultural Act of 1956, as amended

    Section 204 of the Agricultural Act of 1956, as amended,\1\ 
authorizes the President to negotiate agreements with foreign 
governments to limit their exports of agricultural or textile 
products to the United States. The President is authorized to 
issue regulations governing the entry of products subject to 
international agreements concluded under this section. 
Furthermore, if a multilateral agreement is concluded among 
countries accounting for a significant part of world trade in 
the articles concerned, the President may also issue 
regulations governing entry of those same articles from 
countries which are not parties to the multilateral agreement, 
or countries to which the United States does not apply the 
Agreement.
---------------------------------------------------------------------------
    \1\ Public Law 84-540, ch. 327, approved May 28, 1956, 70 Stat. 
200, as amended by Public Law 87-488, approved June 19, 1962, 76 Stat. 
104, 7 U.S.C. 1854 and Public Law 103-465, approved Dec. 8, 1994.
---------------------------------------------------------------------------
    The authority provided under section 204 has been used to 
negotiate bilateral agreements restricting the exportation of 
certain meats to the United States,\2\ as well as to implement 
an agreement with the European Communities (EC) restricting 
U.S. importation of certain cheeses from the EC.\3\ Section 204 
also provided the legal basis for the GATT Arrangement 
Regarding International Trade in Textiles, commonly referred to 
as the Multifiber Arrangement (MFA),\4\ for U.S. bilateral 
agreements with 47 \5\ textile-exporting nations, and currently 
provides the basis for U.S. implementation of the Uruguay Round 
Agreement on Textiles and Clothing (ATC), which replaces the 
now expired MFA.
---------------------------------------------------------------------------
    \2\ Exec. Order No. 11539, June 30, 1970, 35 Fed. Reg. 10733, as 
amended by Exec. Order No. 12188, Jan. 2, 1980, 45 Fed. Reg. 989.
    \3\ Exec. Order No. 11851, April 10, 1975, 40 Fed. Reg. 16645.
    \4\ Arrangement Regarding International Trade in Textiles, T.I.A.S. 
7840 (1973) (expired 1994).
    \5\ In force as of January 1, 2001.
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                      MULTIFIBER ARRANGEMENT (MFA)

    The Multifiber Arrangement was a multilateral agreement 
negotiated under the auspices of the General Agreement on 
Tariffs and Trade. The MFA provided a general framework and 
guiding principles for the negotiation of bilateral agreements 
between textile importing and exporting countries, or for 
unilateral action by an importing country if an agreement 
cannot be reached. In effect since 1974, the MFA was 
established to deal with problems of market disruption in 
textile trade, while permitting developing countries to share 
in expanded export opportunities.

Background

    The first voluntary agreement to limit exports of cotton 
textiles to the United States was negotiated with Japan in 
1957. Through the 1950's cotton textile imports, especially 
from Japan, continued to increase and generate pressure for 
import restraints. In 1956, the Congress passed the 
Agricultural Act of 1956 which, among other things, provided 
negotiating authority for agreements restricting imports of 
textile products. Pursuant to this authority, the United States 
negotiated a 5-year voluntary restraint agreement on cotton 
textile exports from Japan, announced in January 1957.
    As textile and apparel imports from low-wage developing 
countries began to rise, pressure mounted for a more 
comprehensive approach to the import problem. On May 2, 1961, 
President Kennedy announced a Seven Point Textile Program, one 
point of which called for an international conference of 
textile importing and exporting countries to develop an 
international agreement governing textile trade. On July 17, 
1961, a textile conference was convened under the auspices of 
the GATT. The discussions culminated in the promulgation of the 
Short-Term Arrangement on Cotton Textile Trade (STA) on July 
21, 1961.\6\ The STA covered the year October 1, 1961, to 
September 30, 1962, and established a GATT Cotton Textiles 
Committee to negotiate a long-range cotton textile agreement.
---------------------------------------------------------------------------
    \6\ T.I.A.S. 4884 (1961) (expired 1962).
---------------------------------------------------------------------------
    From October 1961 through February 1962, the STA 
signatories met in Geneva and negotiated a Long-Term 
Arrangement for Cotton Textile Trade (LTA), to last for 5 years 
beginning October 1, 1962.\7\ The LTA provided for negotiation 
of bilateral agreements between cotton textile importing and 
exporting countries, and for imposition of quantitative 
restraints on particular categories of cotton textile products 
from particular countries when there was evidence of market 
disruption. In June of 1962, section 204 of the Agricultural 
Act of 1956 was amended to give the President authority to 
control imports from countries which did not sign the LTA.\8\
---------------------------------------------------------------------------
    \7\ T.I.A.S. 5240 (1962) (expired 1973).
    \8\ Public Law 87-488, approved June 19, 1962, 76 Stat. 104.
---------------------------------------------------------------------------
    In the fall of 1965 the LTA was reviewed, and criticism 
within the U.S. textile industry mounted with respect to the 
LTA's failure to cover man-made fiber textiles. In 1967, 
however, the LTA was extended for 3 additional years with no 
additional fiber coverage. In 1970, the LTA was again extended 
for 3 more years.
    Meanwhile, multifiber agreements limiting imports not only 
of cotton but also of wool and man-made fiber textiles were 
negotiated by the Nixon administration on a bilateral basis. On 
October 15, 1971, bilateral multifiber agreements were 
announced with Japan, Hong Kong, South Korea, and Taiwan. A 
multilateral agreement, incorporating the provisions of the 
bilaterals with Hong Kong, South Korea, and Taiwan, was also 
signed to allow the United States the authority, under section 
204 of the Agricultural Act of 1956 as amended in 1962, to 
impose quantitative restrictions unilaterally on non-signatory 
countries.
    The following year, in June 1972, efforts to negotiate a 
multifiber agreement on a broader multilateral basis led to the 
establishment of a GATT working party to conduct a 
comprehensive study of conditions of world trade in textiles. 
The working group submitted its study to the GATT Council early 
in 1973. In the fall of that year, multilateral negotiations 
for a multifiber agreement began after passage of a 3-month 
extension of the LTA. The first Multifiber Arrangement (MFA I) 
was concluded on December 20, 1973, and came into force January 
1, 1974, supplanting the LTA.

MFA provisions

    The MFA was modeled after the LTA and provided for 
bilateral agreements between textile importing and exporting 
nations under which industrial countries have negotiated quotas 
on imports of textiles and clothing primarily from developing 
countries (article 4), and for unilateral actions following a 
finding of market disruption (article 3).\9\ Quantitative 
restrictions were based on past volumes of trade, with the 
right, within certain limits, to transfer the quota amounts 
between products and between years. The MFA also provided 
generally for a minimum annual growth rate of 6 percent.\10\ 
Quotas already in place had to be conformed to the MFA or 
abolished within a year. The products covered by MFA I, II, and 
III included all manufactured products whose chief value is 
represented by cotton, wool, man-made fibers or a blend 
thereof. Also included were products whose chief weight is 
represented by cotton, wool, man-made fibers or a blend 
thereof. MFA IV expanded product coverage to include products 
made of vegetable fibers such as linen and ramie, and silk 
blends as well.
---------------------------------------------------------------------------
    \9\ Market disruption exists when domestic producers are suffering 
``serious damage'' or the threat thereof. Factors to be considered in 
determining whether the domestic producers are seriously damaged 
include: turnover, market share, profit, export performance, 
employment, volume of disruptive and other imports, production, 
utilization of capacity, productivity, and investments. Such damage 
must be caused by a sharp, substantial increase of particular products 
from particular sources which are offered at prices substantially below 
those prevailing in the importing country.
    \10\ The annual growth rate applies to overall levels of imports 
from a particular supplier country. Higher or lower growth rates can 
apply to particular products, as long as the overall growth rate with 
respect to that supplier country is 6 percent.
---------------------------------------------------------------------------
    Overall management of the MFA was undertaken by the GATT 
Textiles Committee, which is made up of representatives of 
countries participating in the MFA and is chaired by the GATT 
Director General. A Textile Surveillance Body (TSB) was 
established to supervise the detailed implementation of the 
MFA.
    MFA I was in effect for 4 years, until the end of 1977. 
During MFA renewal negotiations in July 1977 the EC succeeded 
in putting in the renewal protocol a provision allowing jointly 
agreed ``reasonable departures'' from the MFA requirements in 
negotiating bilateral agreements. The MFA was then renewed for 
4 more years.\11\
---------------------------------------------------------------------------
    \11\ T.I.A.S. 8939 (1977).
---------------------------------------------------------------------------
    MFA II was in effect through December 1981. On December 22, 
1981, a protocol was initialed extending the MFA for an 
additional 4\1/2\ years, and providing a further interpretation 
of MFA requirements in light of 1981 conditions.\12\ MFA III 
expired on July 31, 1986. MFA IV went into effect on August 1, 
1986 for a 5-year period. MFA IV was extended on July 31, 1991 
for 17 months from August 1, 1991 until December 31, 1992, with 
the expectation that the results of the GATT Uruguay Round of 
Multilateral Trade Negotiations would come into force 
immediately thereafter. On December 10, 1992, the MFA was 
extended for a fifth time, until December 31, 1993, and then 
for a final time until December 31, 1994.
---------------------------------------------------------------------------
    \12\ T.I.A.S. 10323 (1981).
---------------------------------------------------------------------------

            URUGUAY ROUND AGREEMENT ON TEXTILES AND CLOTHING

    One aim of the Uruguay Round was to integrate the textiles 
and clothing sector into the GATT. The resulting Agreement on 
Textiles and Clothing (ATC) establishes a 10-year phase-out of 
the quotas established under the MFA. Although the MFA expired 
on December 31, 1994, the bilateral agreements negotiated 
between individual importing and supplier governments remain in 
force. If the signatories to those bilateral arrangements are 
members of the World Trade Organization (WTO), the quota levels 
established under those agreements are now governed by the ATC. 
This means that the quotas must be adjusted in accordance with 
ATC rules.
    As a general matter, the ATC was designed to generate 
increased opportunities for trade in the textiles and apparel 
sector. It liberalizes the current trading rules in two ways: 
by increasing and then removing quotas in three phases over a 
10-year transition period and by requiring all participants to 
provide improved access to their markets.
    Thus, on January 1, 1995, each importing signatory to the 
WTO, including the United States, Canada, and the members of 
the European Union, was required to ``integrate'' into normal 
GATT rules (including GATT 1947's article XIX and the Uruguay 
Round's Agreement on Safeguards) textile and apparel products 
accounting for at least 16 percent of the trade covered by the 
ATC, using 1990 as the base year. Integration means that any 
existing quotas on integrated products under MFA rules 
automatically become void and no new quotas may be imposed upon 
such products unless there has been a determination of serious 
injury under GATT article XIX, the safeguards provision.
    On January 1, 1998, the importing nations were required to 
integrate another 17 percent of trade, and on January 1, 2002, 
an additional 18 percent. Beginning in 2005, all textile and 
apparel trade will fall under normal GATT/WTO rules. Under the 
terms of the ATC, the Agreement cannot be extended beyond 10 
years.
    The U.S. Committee for the Implementation of Textile 
Agreements (CITA) currently is the inter-agency group 
responsible for administering the U.S. quota program and 
implementation of ATC. CITA is composed of representatives from 
the Departments of Commerce, State, Labor, and Treasury, and 
the Office of the U.S. Trade Representative. The Commerce 
Department official is chair of the committee and heads the 
Office of Textiles and Apparel (OTEXA) in the Department of 
Commerce which implements the terms of the agreements and 
decisions made by CITA. A primary function of CITA is to 
monitor imports and to determine when calls for consultations 
are to be made. The CITA announced in October 1994 which 
products it would integrate on January 1, 1995.\13\
---------------------------------------------------------------------------
    \13\ (59 Fed. Reg. 51942)
---------------------------------------------------------------------------
    Under the Uruguay Round Agreements Act (URAA), CITA decided 
by April 30, 1995 which products will be included in each of 
the next two integration ``tranches,'' with the most sensitive 
products to be integrated last.\14\ No changes may be made in 
the integration schedule, unless required by law or in order to 
carry out U.S. international obligations, or to correct 
technical errors or reclassifications.
---------------------------------------------------------------------------
    \14\ (60 Fed. Reg. 5625)
---------------------------------------------------------------------------
    The ATC requires that existing growth rates--the amounts by 
which quota levels are to rise each year--be gradually 
increased. According to the ATC, the increase in growth rates 
is to be applied in three stages, with each stage's growth to 
be applied on top of existing rates. Thus, during stage one, 
the first 3 years of the ATC, the level of annual growth for 
each individual quota is to be increased by 16 percent. During 
stage two, the annual growth rate is to increase another 25 
percent, and during stage three, which covers the last 3 years 
of the phase-out process, the ``growth on growth'' rate is 27 
percent. These increases are intended to replace the 
renegotiation of bilateral textile agreements.
    There is one potential exception to the ATC's growth-on-
growth provision. A country may seek to preclude a supplier 
country from obtaining such benefits if the supplier provides 
inadequate market access for textile products. Any WTO member 
may bring a market access complaint before the WTO's Textile 
Monitoring Board (which replaces the MFA's TSB), which then may 
authorize the importing nation not to increase growth rates for 
the relevant supplier at the next stage of the transition.

Rules of origin

    The URAA also directed the U.S. Treasury Department to 
change by July 1, 1996, the rules of origin for textile and 
apparel products. Rules of origin determine which country's 
quotas should be charged for particular imports when 
manufacturing of the goods occurs in more than one country. The 
U.S. domestic industry sought the rules change on the ground 
that suppliers were purposely splitting their manufacturing 
operations among various countries as a means of avoiding quota 
restrictions.
    For apparel products, the rules change means that the place 
of assembly will generally determine the origin of a product. 
Under Customs Service regulations in effect prior to July 1, 
1996, the origin of apparel depends upon the complexity of the 
assembly operation. For garments requiring only simple 
assembly, such as the sewing together of four or five pieces, 
the country in which those pieces were cut was usually 
considered the country of origin. For more tailored garments, 
the country of assembly was the country of origin under the old 
rule. According to the new rule, textile products manufactured 
in several countries are deemed to originate where the ``most 
important'' assembly process occurred, regardless of where the 
product was cut. Under both the earlier rule and the rule 
established in 1996, the origin of knitted garments is the 
country in which the knit-to-shape pieces were formed.
    For non-apparel products, the country in which the fabric 
is woven or knit generally is the country of origin under the 
new rule. Prior to the URAA changes, the country in which the 
fabric is printed and dyed and subject to additional 
``finishing operations'' or in which it is cut and then sewn 
was often the country of origin for quota purposes.
    Products covered by the United States-Israel Free Trade 
Area Agreement are exempt from the rules change.

                      BILATERAL TEXTILE AGREEMENTS

    Under authority of section 204 of the Agricultural Act of 
1956, as amended, and in conformity with the MFA, the President 
negotiated bilateral agreements restricting textile exports 
from supplier countries. There were 42 such bilateral 
agreements in force as of December 31, 1994, 27 of which were 
with members of the World Trade Organization. Provisions of 
bilateral agreements in effect with WTO members were carried 
over and remain in effect under the new ATC. Quota levels 
established under these agreements provide the base levels for 
the annual growth provisions of the ATC.
    As of January 1, 2001, the United States has bilateral 
agreements governed by the ATC with 39 members of the WTO. The 
United States has agreements (not governed by the ATC) with 
eight non-WTO members
    Bilateral textile agreements apply to textile products, 
fiber and fabric, and apparel. Each agreement contains 
flexible, specific, and/or aggregate limits with respect to the 
type and volume of textile products that the supplier country 
can export to the United States. Limits are usually set in 
terms of square meter equivalents (SME's). They allow, under 
certain conditions, for carryover (from the prior year to 
current year within the same product category), carryforward 
(from the subsequent year to the current year within the same 
product category), and swing (from one product category to 
another product category within the same year) of unused 
portions of quotas. These provisions may be applied only with 
respect to specific import limits set forth in the bilateral 
agreement. Each agreement also provides for adjustment of 
import levels in accordance with specified growth rates. The 
bilateral with Taiwan provides for an export control system to 
be administered by this exporting country to assure compliance 
with the terms of the Agreement.\15\
---------------------------------------------------------------------------
    \15\ Exec. Order 11651, 3 CFR 676 (1971-75 Comp.).
---------------------------------------------------------------------------
    The ATC alters somewhat the process by which new quotas may 
be established during the 10-year phase-out process, compared 
with the system that existed under the MFA. Under the ATC's 
``transitional safeguard'' mechanism, if CITA determines that 
imports of a particular product are causing ``serious damage'' 
or the ``actual threat thereof,'' it will be able to establish 
quotas on unrestrained suppliers of that product.
    Under the MFA, before CITA could request consultations with 
a particular country (or ``issue a call'') for the purpose of 
negotiating a quota, it had to determine that imports of a 
certain category of products from that country were causing--or 
threatening to cause--``market disruption.'' Thus, under the 
MFA, the injury determination was both product and country 
specific. Under the ATC, the injury must only be product 
specific, and once an injury determination is made, a country 
can seek a quota with any supplier whose exports of that 
product are ``increasing sharply and substantially.'' If 
consultations fail to produce an agreement on restrictive 
levels, and a country is able to demonstrate that such imports 
are causing or threatening serious damage, the country may take 
unilateral action to establish a quota at a level based upon 
trade during a recent 12-month period. Such quotas will be 
permitted to remain in place for up to 3 years (although the 
quota must be increased annually), unless the product is 
integrated into normal WTO rules before then. All calls will be 
subject to review by the WTO's Textiles Monitoring Board.

    Textiles and Apparel Trade Under the North American Free Trade 
                               Agreement

    NAFTA created a number of special rules affecting trade in 
textiles among the United States, Canada and Mexico. The NAFTA 
textiles rules of origin determine which goods are 
``originating'' and therefore eligible for preferential 
treatment, i.e., reduced or duty-free entry. Products of Canada 
or Mexico that do not meet the NAFTA origin rules, or one of 
the several exceptions to those rules, are not precluded from 
entering the United States. However, they may be subject to 
normal (non-preferential) duties or, for Mexican goods, to 
quota requirements.
    A ``yarn-forward'' rule of origin applies to most textile 
products, although there are a number of exceptions. Yarn-
forward means that the finished textile or apparel product must 
be made from fabric formed in North America from yarn spun in 
North America.
    NAFTA also includes ``tariff preference levels'' (TPLs) 
that permit a limited number of Canadian and Mexican textile 
and apparel products to enter the United States each year at 
the preferential NAFTA tariff rate even though the products do 
not meet the ``yarn forward'' origin rules, and therefore are 
not ``originating'' goods. These are essentially annual tariff 
rate quotas. Once imports reach the TPL limit, most-favored-
nation (MFN) duties will be applied to any additional non-
originating products entered during the rest of the year.
    Most quotas on Mexican-made textile and apparel products 
were eliminated upon implementation of the NAFTA, but a few 
quotas remain. The remaining quotas apply only to products that 
do not meet the preferential NAFTA origin rules but are 
considered to be products of Mexico for other purposes. The 
remaining U.S. quotas on Mexican goods are scheduled to be 
removed by the year 2004.

         Section 22 of the Agricultural Adjustment Act of 1933

    Section 22 of the Agricultural Adjustment Act of 1933, as 
amended (7 U.S.C. 624), authorizes the President to impose fees 
or quotas on imported products that undermine any U.S. 
Department of Agriculture (USDA) domestic commodity program. 
This authority is designed to prevent imports from interfering 
with USDA efforts to stabilize domestic agricultural commodity 
prices. However, in the Uruguay Round Agreement on Agriculture, 
the United States agreed to convert all quotas and fees on 
imports from any country to which the United States applies the 
WTO Agreement to tariff-rate quotas. Section 22 authority is 
available now only for imports from countries to which the 
United States does not apply the WTO Agreement.

Basic provisions

    Under section 22, the Secretary of Agriculture advises the 
President when the Secretary has reason to believe that--
          (1) imports of an article are rendering, or tending 
        to render ineffective, or materially interfering with, 
        any domestic, agricultural-commodity price-support 
        program, or other agricultural program; or
          (2) imports of an article are reducing substantially 
        the amount of any product processed in the United 
        States from any agricultural commodity or product 
        covered by such programs.
    If the President agrees that there is reason for the 
Secretary's belief, the President must order an ITC 
investigation and report. Using this report as his basis, the 
President must determine whether the statutory conditions 
warranting imposition of a section 22 quota or fee exist.
    If the President makes an affirmative determination, he is 
required to impose, by proclamation, either import fees (which 
may not exceed 50 percent ad valorem) or import quotas (which 
may not exceed 50 percent of the quantity imported during a 
representative period) sufficient to prevent imports of the 
product concerned from harming or interfering with the relevant 
agricultural program.

Application

    Between 1935 and 1985, section 22 was used to impose import 
restrictions on 12 different commodities or food product 
groups: (1) wheat and wheat flour; (2) rye, rye flour, and rye 
meal; (3) barley, hulled or unhulled, including rolled, ground, 
and barley malt; (4) oats, hulled or unhulled, and unhulled 
ground oats; (5) cotton, certain cotton wastes, and cotton 
products; (6) certain dairy products; (7) shelled almonds; (8) 
shelled filberts; (9) peanuts and peanut oil; (10) tung nuts 
and tung oil; (11) flaxseed and linseed oil; and (12) sugars, 
syrups, and sugar-containing products. Section 22 fees and 
quotas have since been terminated for most of these 
commodities. Prior to implementation of the Uruguay Round 
Agreement on agriculture in late 1994, import quotas were in 
place to protect certain cotton, specific dairy products, 
peanuts, and certain sugar-containing products, such as 
sweetened cocoa, pancake flours, and ice-tea mixes. Import fees 
were in place on refined sugar.

    Agriculture Trade Under the North American Free Trade Agreement 
                           Implementation Act


Background

    NAFTA is the first free trade agreement entered into by the 
United States that employs the concept of ``tariffication'' of 
agricultural quantitative restrictions. Under this method, a 
country replaces each of its non-tariff barriers with a 
``tariff-equivalent,'' which is a tariff set at a level that 
will provide protection for a product equivalent to the non-
tariff barrier that the tariff replaces. In the case of several 
agricultural goods listed in the tariff schedules of each NAFTA 
country, the NAFTA countries converted quantitative 
restrictions to tariffs or tariff-rate quotas.
    Pursuant to the NAFTA, U.S. section 22 quotas and fees were 
converted to tariff-rate quotas, under which ``qualifying'' 
Mexican dairy products, cotton, sugar-containing products, and 
peanuts will enter the United States duty free up to a certain 
quantity of imports (the ``in quota'' quantity.) A ``qualifying 
good'' is an agricultural good that meets, based on its Mexican 
content alone, the NAFTA rules of origin contained in section 
202 of the NAFTA Implementation Act.
    To a large extent, the NAFTA agriculture agreement amounts 
to three bilateral agreements rather than a trilateral accord. 
For agriculture goods traded between United States and Canada, 
the NAFTA incorporates the agricultural market access 
provisions of chapter 7 of the United States-Canada Free-Trade 
Agreement (CFTA). The NAFTA sets out separate agricultural 
market access agreements between Mexico and the United States 
and between Mexico and Canada. In addition the NAFTA includes 
several obligations governing agriculture trade common to all 
three countries.

Basic provisions

    Section 321(b) of the North American Free Trade Agreement 
Implementation Act authorizes the President, pursuant to the 
NAFTA, to exempt any ``qualifying good'' from any quantitative 
limitation or fee imposed under section 22 of the Agricultural 
Adjustment Act for as long as Mexico is a NAFTA country.
    As discussed above, the United States agreed to convert its 
import quotas to tariff rate quotas under section 22 of the 
Agricultural Adjustment Act for imports from Mexico of dairy 
products, cotton, sugar-containing products and peanuts. 
Article 302(4) of the NAFTA permits the allocation of the in-
quota quantity under these tariff rate quotas, provided that 
such measures do not have trade restrictive effects on imports 
in addition to those caused by the imposition of the tariff-
rate quotas. Section 321(c) of the NAFTA Act directs the 
President to take such action as may be necessary to ensure 
that imports of goods subject to tariff rate quotas do not 
disrupt the orderly marketing of commodities in the United 
States.
    Section 321(f) of the Act is a free-standing provision that 
establishes an end-use certificate requirement for imports of 
wheat or barley imported into the United States from any 
foreign country or instrumentality that requires end-use 
certificates on wheat or barley produced in the United States.
    Section 308 of the NAFTA Act amends the CFTA Act, which 
implemented the tariff ``snapback'' provided for in article 702 
of the CFTA, to provide that the President may impose a 
temporary duty on imports of a listed Canadian fresh fruit or 
vegetable if a certain import price and other conditions exist.
    Section 309 establishes a price-based snapback for imports 
of frozen concentrated orange juice into the United States from 
Mexico. The tariff on imports of Mexican frozen concentrated 
orange juice in excess of the threshold quantity will 
``snapback'' or revert to the lesser of the prevailing most-
favored-nation rate or the rate of duty on that product in 
effect as of July 1, 1991, if futures prices for frozen 
concentrated orange juice in the United States fall below a 
historical average price for 5 consecutive days. This tariff 
snapback is automatically triggered and removed upon a 
determination by the Secretary of Agriculture.

        Agriculture Trade Under the Uruguay Round Agreements Act


Background

    The Uruguay Round Agreement on Agriculture strengthens 
multilateral rules for trade in agricultural products and 
requires WTO members to reduce export subsidies, trade 
distorting domestic support programs and import protection. The 
Agreement establishes rules and reduction commitments over 6 
years for developed countries and 10 years for developing 
countries on export subsidies, domestic subsidies, and market 
access. The Agreement is intended to be the beginning of a 
reform process for world trade in agriculture and provides for 
the initiation of a second round of negotiations concerning 
agriculture trade beginning in the year 2000.
    Export subsidies must be reduced from 36 percent (budget 
outlays) and 21 percent (volume) from a 1986-1990 base period 
for specific products and categories. Trade distorting domestic 
subsidies must be bound and reduced by 20 percent from a 1986-
1990 base period. non-tariff import barriers are subject to 
comprehensive tariffication, and minimum or current market 
access commitments. The United States thus agreed to convert 
quotas and fees authorized under section 22 of the Agricultural 
Adjustment Act to tariff-rate equivalents in the form of 
tariff-rate quotas. In the Uruguay Round, all U.S. agriculture 
tariffs were bound and subject to specific reduction 
commitments.
    The operation of these rules is linked to particular 
commitments by each WTO member contained in that WTO member's 
schedule annexed to the Marrakesh Protocol to the GATT 1994. 
Each WTO member's schedule sets forth the WTO members' 
commitments regarding the access it will provide to its market 
for imports of agriculture products and the maximum amount of 
domestic support and export subsidies it will provide to 
agricultural products. Under article 3 of the Agreement, the 
domestic support and export subsidy commitments in each WTO 
member's schedule are an integral part of GATT 1994.
    Article 2 and annex 1 of the Agreement define agricultural 
products covered as those products classified in chapters 1-24 
of the Harmonized Tariff Schedule (HTS) (excluding fish and 
fish products) and under 13 headings or subheadings in other 
chapters of the HTS, including cotton, wool, hides and fur 
skins.
    The United States was obligated to implement its 
commitments over a 6-year period beginning in 1995. The rights 
and obligations in the Agriculture Agreement supplement those 
in GATT 1994, including the Agreements on Subsidies and 
Countervailing Measures and Application of Sanitary and 
Phytosanitary Measures.

Basic provisions

    Section 401(a)(1) of the Uruguay Round Trade Agreements Act 
amends section 22 of the Agricultural Adjustment Act of 1933, 
such that no quota or fee shall be imposed under this section 
with respect to any import that is the product of a country or 
separate customs territory to which the United States applies 
the WTO Agreements. Accordingly, when products of WTO members 
only are involved, there would be no need to conduct a section 
22 investigation. Section 22 authority is retained with respect 
to imports from countries and separate customs territories to 
which the United States does not apply the WTO agreements. 
These amendments were effective upon entry into force of the 
WTO Agreement, January 1, 1995.
    The conversion of U.S. quantitative import restrictions to 
tariff-rate quotas and staged tariff reductions was implemented 
by Presidential Proclamation No. 6763 issued on December 13, 
1994. Effective on January 1, 1995, this proclamation amended 
the HTS of the United States under general authority provided 
to the President in the Uruguay Round Agreements Act. The 
President proclaimed tariff-rate quotas for the following 
products subject to tariffication by the United States: dairy 
products, sugar, sugar-containing products, peanuts, cotton and 
beef. In general tariff-rate quotas replaced previously 
applicable restrictions as of January 1, 1995. In some cases, 
however, the United States began implementing its increased 
access commitments after the entry into force of the WTO 
Agreement, if the quota year for those products began at a 
different time of year.
    Section 404(a) of the Uruguay Round Agreements Act 
authorizes the President to take such action as may be 
necessary to implement the tariff-rate quotas set out in the 
U.S. agricultural tariff concessions in schedule XX of the 
Agreement and to ensure that imports of agricultural products 
do not disrupt the orderly marketing of commodities in the 
United States. Section 404(b) authorizes the President, upon 
the advice of the Secretary of Agriculture, to temporarily 
increase the in-quota quantity of an agricultural import that 
is subject to a tariff-rate quota when the President determines 
and proclaims that that the supply of the same, directly 
competitive, or substitutable agricultural product will be 
inadequate because of natural disaster, disease or a major 
national market disruption to meet domestic demand at 
reasonable prices.
    In administering the tariff-rate quota, the President is 
authorized to allocate, among supplying countries or customs 
areas, the in-quota quantity of a tariff-rate quota for any 
agricultural product, and to modify any allocation as he deems 
appropriate.
    Section 404(e) of the Uruguay Round Agreements Act amends 
the Caribbean Basin Economic Recovery Act (CBERA), the Andean 
Trade Preference Act (ATPA), the Generalized System of 
Preferences (GSP) statute, and General Note 3(a) to the HTS 
(relating to insular possessions) to specify that any duty 
preference afforded these laws will be available only for the 
in-quota amount of a tariff-rate quota. Over-quota imports from 
CBERA, ATPA, or GSP countries, or U.S. insular possessions will 
in all cases be subject to the higher rate of duty. Section 
405(b) requires the President, if he determines that it is 
appropriate, to invoke either a volume-based or price-based 
special safeguard for agricultural goods and to determine, 
consistent with article 5, the amount of the additional duty to 
be imposed, the period during which such duty will be imposed, 
and any other terms and conditions applicable to the duty.

                        Meat Import Act of 1979

    The Meat Import Act of 1979, as amended, required the 
President to impose quotas on imports of beef, veal, mutton, 
and goat meat when the aggregate quantity of such imports on an 
annual basis was expected to exceed a prescribed trigger level. 
As a matter of practice, the import-limiting effect of the Meat 
Import Act was achieved, prior to the conclusion of the Uruguay 
Round, through the negotiation of voluntary restraint 
agreements with major supplier countries of the covered 
products. Section 403 of the Uruguay Round Act repealed the 
Meat Import Act of 1979 in order to conform to U.S. commitments 
under the Agreement on Agriculture not to maintain this type of 
quantitative import restriction. The Uruguay Round Act 
substitutes a tariff-rate quota on meat imports for the 
previous import restrictions.

                 Reciprocal Meat Inspection Requirement

    Section 4604 of the Omnibus Trade and Competitiveness Act 
of 1988 \16\ amends section 20 of the Federal Meat Inspection 
Act (21 U.S.C. 620) to authorize strict enforcement of all 
standards which are applicable to meat articles in domestic 
commerce, for meat articles imported into the United States. If 
the Secretary of Agriculture determines that a foreign country 
applies meat inspection standards that are not related to 
public health concerns about end-product quality which are 
substantiated by reliable analytical methods, the Secretary 
must consult with the U.S. Trade Representative and they shall 
make a recommendation to the President as to what action should 
be taken. The President may require that a meat article 
produced in a plant in such foreign country may not be 
permitted entry into the United States unless the Secretary 
determines that the meat article has met the standards 
applicable to meat articles in commerce within the United 
States. The annual report required generally under section 20 
of the Federal Meat Inspection Act shall include the name of 
each foreign country that applies standards for the importation 
of meat articles from the United States that are not based on 
public health concerns.
---------------------------------------------------------------------------
    \16\ Public Law 100-418, approved August 23, 1988, 102 Stat. 1107, 
1408, amending section 20 of Public Law 90-201, 21 U.S.C. 620.
---------------------------------------------------------------------------
    Enactment of this provision resulted from congressional 
concern over the European Community's (EC) hormone ban, which 
since 1989 has effectively banned all meat exports from the 
United States to the EC that were produced from livestock 
treated with hormones, despite scientific evidence establishing 
the safety of U.S. production methods. At the time of 
enactment, bilateral consultations with the EC were underway, 
and Congress wanted to strengthen the Administration's 
authority to respond to the EC action. The authority added by 
section 4604 was intended to be used either in addition to, or 
instead of, other authorities (such as section 301 of the Trade 
Act of 1974).

 Sugar Tariff-Rate Quotas Under Harmonized Tariff Schedule Authorities

    Additional U.S. note 5 to chapter 17 of the Harmonized 
Tariff Schedule of the United States (HTS) authorizes the 
Secretary of Agriculture, in consultation with other agencies, 
to establish, for each fiscal year, the quantity of sugars and 
syrups that may be entered at the lower tariff rates under two 
tariff-rate quotas (TRQ's). The TRQ's cover sugars and syrups 
described in HTS subheadings 1701.11, 1701.12, 1701.91, 
1701.99, 1702.90, and 2106.90. This authority was proclaimed to 
implement the results of the Uruguay Round of multilateral 
trade negotiations as reflected in the provisions of schedule 
XX (United States), annexed to the Agreement Establishing the 
World Trade Organization.\17\
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    \17\ Pres. Proc. No. 6763, Dec. 23, 1994, 60 Fed. Reg. 1007.
---------------------------------------------------------------------------

Background

    The United States has always been a net importer of sugar, 
at times importing more than half of the nation's sugar 
consumption. However, sugar imports have been restricted almost 
continuously since 1934 in order to maintain and foster the 
domestic sugarcane and sugar beet industries. From the 
enactment of the Jones Costigan Sugar Act of 1934 \18\ through 
the expiration of the Sugar Act of 1948 on December 31, 
1974,\19\ sugar imports were restricted by a statutory quota. 
Historically, this system of import protection has maintained a 
U.S. price for sugar well above the world price.
---------------------------------------------------------------------------
    \18\ Pub. L. No. 73-213, ch. 263, approved May 9, 1934, 48 Stat. 
670.
    \19\ Pub. L. No. 80-388, ch. 519, approved August 8, 1947, 61 Stat. 
922. See also the Sugar Act of 1937, Pub. L. No. 75-414, ch. 898, 
approved September 1, 1937, 50 Stat. 903.
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    Shortly before the expiration of the Sugar Act of 1948, an 
absolute import quota was proclaimed by President Ford, 
although the quota quantity was so large as to be non-
restrictive.\20\ The quota derived from a note that had been 
negotiated in the Annecy (1949) and Torquay (1951) Rounds of 
multilateral trade negotiations and was proclaimed as a 
headnote to the Tariff Schedule of the United States (TSUS) 
following the conclusion of the Kennedy Round (1963-1967). On 
May 5, 1982, President Reagan modified this headnote quota to: 
(1) make it restrictive; (2) allocate the quota among supplying 
countries in accordance with their shares of the U.S. market 
during the period from 1975 through 1981; and (3) authorize the 
Secretary of Agriculture to establish and modify the quota 
amount in subsequent periods.\21\
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    \20\ Pres. Proc. No. 4334, November 16, 1974, 39 Fed. Reg. 40739.
    \21\ Pres. Proc. No. 4941, May 5, 1982, 47 Fed. Reg. 19661.
---------------------------------------------------------------------------
    By 1988, the quota had been reduced to the lowest ratio of 
imports to domestic production in the nation's history. The 
government of Australia challenged the legality of the sugar 
import quota under the provisions of the General Agreement on 
Tariffs and Trade (GATT), and in 1989, a GATT dispute 
settlement panel found the quota illegal. In 1990, President 
Bush issued Proclamation No. 6179 \22\ to convert the absolute 
import quota into a tariff-rate quota, thereby bringing it into 
conformity with the GATT TRQ panel decision. During the Uruguay 
Round of multilateral trade negotiations, the quota was 
reconverted into two TRQ's, one for imports of raw cane sugar 
and the other for imports of refined sugar, including syrups. 
The United States agreed to bind its minimum total sugar/syrups 
TRQ at 1,139,195 metric tons (MT). In addition, the United 
States agreed to reduce the second tier (over quota) tariff 
rates by 15 percent over 6 years.\23\
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    \22\ Pres. Proc. No. 6179, September 13, 1990, 55 Fed. Reg. 38293.
    \23\ See Pres. Proc. No. 6763, December 23, 1994.
---------------------------------------------------------------------------
    Under the tariff-rate quota system, the Secretary of 
Agriculture establishes the quota quantity that can be entered 
at the lower tier of tariff rates, and the USTR allocates this 
quantity among the 40 eligible sugar exporting countries. The 
quantities allocated to beneficiary countries under the GSP, 
the CBI and the ATPA receive duty-free treatment. Certificates 
of Quota Eligibility (CQE) are issued to the exporting 
countries and must be executed and returned with the shipment 
of sugar in order to receive quota treatment.\24\ Imports of 
raw cane sugar are permitted in addition to the quota quantity 
on condition that such sugar is to be refined and used in the 
production of certain polyhydric alcohols or to be re-exported 
in refined form or in sugar-containing products.\25\
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    \24\ See 15 C.F.R. part 2011.
    \25\ See additional U.S. note 6 to chapter 17 of the HTS and 7 
C.F.R. part 1530.
---------------------------------------------------------------------------
    The quantity of sugar which may be imported duty free from 
Mexico is governed by paragraphs 13-22 of section A of annex 
703.2 of the North American Free Trade Agreement (NAFTA). Since 
1982, Mexico has been included within a basket category known 
as the ``other specified countries and areas'' and has been 
allocated a minimum quota amount, currently set at 7,258 MT raw 
value. The NAFTA guarantees the greater of this access or 
Mexico's net surplus production, but no greater than 25,000 MT 
during the first 6 years or 250,000 MT during the remaining 8 
years of the NAFTA implementation period. Additional sugar may 
enter at a duty rate that is being eliminated in stages through 
2008. During each of the first 14 years of the NAFTA, Mexico 
and the United States will jointly determine whether either has 
been or is projected to be a net surplus producer.\26\ All 
sugar imports from Mexico will enter duty free after the 14-
year transition period.
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    \26\ For purposes of the NAFTA formulas, high fructose corn syrup 
(HFCS) is included in determining the consumption of sugar.
---------------------------------------------------------------------------

Import Prohibitions on Certain Agricultural Commodities Under Marketing 
                                 Orders


       Section 8e of the Agricultural Adjustment Act, as amended

    Section 8e of the Agricultural Adjustment Act, as 
amended,\27\ restricts the importation of certain specified 
commodities which do not meet relevant grade, size, quality or 
maturity requirements imposed under the marketing order in 
effect for such commodity. The specified commodities include 
tomatoes, raisins, olives (other than Spanish-style green 
olives), prunes, avocados, mangoes, limes, grapefruit, green 
peppers, Irish potatoes, cucumbers, oranges, onions, walnuts, 
dates, filberts, table grapes, eggplants, kiwifruit, 
nectarines, plums, pistachios, and apples.
---------------------------------------------------------------------------
    \27\ 7 U.S.C. 608e-1.
---------------------------------------------------------------------------
    Any restriction under this authority may not be made 
effective until after the Secretary of Agriculture gives 
reasonable notice (of not less than 3 days) and receives the 
concurrence of the U.S. Trade Representative. The Secretary of 
Agriculture may promulgate such rules and regulations as he 
deems necessary, to carry out the provision of this section.
    Whenever the Secretary of Agriculture finds that the 
application of the restrictions under a marketing order to an 
imported commodity is not practicable because of variations in 
characteristics between the domestic and imported commmodity, 
he/she must establish with respect to the imported commodity 
such grade, size, quality, and maturity restrictions by 
varieties, types, or other classification as he/she finds will 
be equivalent or comparable to those imposed upon the domestic 
commodity under such order.
    Section 4603 of the Omnibus Trade and Competitiveness Act 
of 1988 amended section 8e to provide additional authority for 
the Secretary to establish an additional period of time (not to 
exceed 35 days) for restrictions to apply to imported 
commodities, if the Secretary determines that such additional 
period of time is necessary to effectuate the purposes of the 
Act and to prevent the circumvention of the requirement of a 
seasonal marketing order. In making this determination, the 
Secretary must consider: (1) the extent to which imports during 
the previous year were marketed during the period of the 
marketing order and such imports did not meet the requirements 
of the marketing order; (2) if the importation into the United 
States of such commodity did, or was likely to, circumvent the 
grade, size, quality or maturity standards of a seasonal 
marketing order; and (3) the availability and price of 
commodities of the variety covered by the marketing order 
during any additional period the marketing order requirements 
are to be in effect.
    Section 1308 of the Food, Agriculture, Conservation, and 
Trade Act of 1990 (the ``1990 farm bill'') amended section 8e 
to require the Secretary to consult with the USTR prior to any 
import restriction or regulation being made effective. The USTR 
must advise the Secretary within 60 days of being notified, to 
ensure that the proposed grade size, quality, or maturity 
provisions are not inconsistent with U.S. international 
obligations. If the Secretary receives the concurrence of the 
USTR, the proposed prohibition or regulation may proceed.

    Authorities To Restrict Imports Under Certain Environmental Laws


            Marine Mammal Protection Act of 1972, as amended

    The Marine Mammal Protection Act (MMPA), enacted in 1972, 
\28\ places a ban on the importation of marine mammals and 
marine mammal products, except in limited circumstances, such 
as for scientific research. The MMPA also directs the Secretary 
of the Treasury to ban the importation of commercial fish or 
products from fish which have been caught with commercial 
fishing technology which results in the incidental kill or 
incidental serious injury of ocean mammals in excess of U.S. 
standards. In carrying out the ban, the Secretary, in the case 
of yellowfin tuna harvested with purse seine nets in the 
eastern tropical Pacific Ocean, and products therefrom, to be 
exported to the United States, must require that the government 
of the exporting nation provide certain documentary evidence 
relating to that country's marine mammal conservation programs. 
The Secretary must also require the government of any 
intermediary nation from which yellowfin tuna or tuna products 
will be exported to the United States to certify and provide 
reasonable proof that it has acted to prohibit the importation 
of such tuna and tuna products from any nation from which 
direct export to the United States of such tuna and tuna 
products is banned under the Act.
---------------------------------------------------------------------------
    \28\ Public Law 92-522, approved October 21, 1972, 16 U.S.C. 1361 
et seq.
---------------------------------------------------------------------------
    In 1984, the MMPA was amended to require that each nation 
wishing to export tuna to the United States document that it 
has adopted a dolphin conservation program ``comparable'' to 
that of the United States, and that the average rate of 
mortality of its purse seine fleet is comparable to that of the 
U.S. fleet. If these requirements are not met, an embargo on 
the import of yellowfin tuna and tuna products from that nation 
will be invoked. In 1988, the MMPA was further amended with 
respect to these ``comparability'' provisions by requiring that 
the regulatory programs of other nations in the eastern 
tropical Pacific tuna fishery be at least as restrictive as 
those of the United States. The 1988 amendments also require 
that the government of any intermediary nation from which 
yellowfin tuna or tuna products will be exported to the United 
States certify and provide reasonable proof that it has acted 
to prohibit the importation of tuna and tuna products from 
embargoed nations.
    In August 1990, Mexico's yellowfin tuna was embargoed under 
the comparability provision. Mexico challenged the U.S. embargo 
under procedures of the General Agreement on Tariffs and Trade 
(GATT) and in September 1991, a GATT panel found in favor of 
Mexico. Venezuelan exports of yellowfin tuna to the United 
States also were embargoed and Venezuela began a GATT case 
against the United States in May 1992. A third GATT challenge 
was brought by the European Community (EC) in June 1992, after 
a federal district court ruled that the MMPA also required a 
secondary embargo of tuna products from some 20 intermediary 
nations, including those of the EC, that had failed to certify 
and offer reasonable proof that they had acted to prohibit the 
importation of tuna from the primary embargoed nations. On May 
20, 1994, a GATT dispute settlement panel issued a report 
finding that U.S. tuna embargoes were inconsistent with GATT 
rules.

             International Dolphin Conservation Program Act

    The International Dolphin Conservation Program Act (Public 
Law 105-52), approved August 15, 1997, established the 
International Dolphin Conservation Program to implement into 
U.S. law the Declaration on Panama concerning tuna fishing in 
the Eastern Tropical Pacific Ocean.
    In 1992, Eastern Tropical Pacific nations concluded the La 
Jolla Agreement, a non-binding international agreement 
establishing an International Dolphin Conservation Program 
under the auspices of the Inter-American Tropical Tuna 
Commission. The agreement established annual limits on 
incidental dolphin mortality, required observers on tuna 
vessels, established a review panel to monitor fleet 
compliance, and created a scientific research and education 
program and advisory board. The agreement established a dolphin 
mortality limit for each vessel, and when that limit was 
reached, such vessel would be required to discontinue ``setting 
on dolphins'' for the remainder of the year.
    In October 1995, 12 nations signed the Declaration of 
Panama, including the Unites States, Belize, Colombia, Costa 
Rica, Ecuador, France, Honduras, Mexico, Panama, Spain, 
Vanuatu, and Venezuela. The Panama Declaration endorses the 
success of the La Jolla Agreement and adjusts the marketing 
policy of dolphin safe tune in recognition of this success. In 
exchange for modifications to U.S. law, foreign signatories 
agreed to modify and formalize the La Jolla Agreement as a 
binding agreement. Signatories agreed to adopt conservation and 
management measures to ensure long-term sustainability of tuna 
and living marine resources, assess the catch and bycatch of 
tuna and take steps to reduce of eliminate the bycatch, 
implement the binding agreement through enactment of domestic 
legislation, enhance mechanisms for reviewing compliance with 
the International Dolphin Conservation Program, and establish 
annual quotas for dolphin mortality limiting total annual 
dolphin mortality to fewer than 5,000 animals.
    The International Dolphin Conservation Program Act 
implements the Declaration of Panama in U.S. law by changing 
the circumstances under which the import ban on yellowfin tune 
in section 101 of the MMPA would be imposed. Specifically, the 
bill permits importation of yellowfin tuna if the harvesting 
nation complies with international standards, as follows: (1) 
the tuna was harvested by vessels of a nation that participates 
in the International Dolphin Conservation Program, the 
harvesting nation is either a member of has initiated steps to 
become a member of the Inter-American Tropical Tuna Commission, 
and the nation has implemented its obligations under the 
Program and the Commission; and (2) total dolphin mortality 
permitted under the Program is limited.

               Endangered Species Act of 1973, as amended

    The Endangered Species Act \29\ authorizes the Secretary of 
the Interior to create lists of species or subspecies which are 
considered endangered or threatened, and to prohibit the 
importation or interstate sale of these species or subspecies.
---------------------------------------------------------------------------
    \29\ Public Law 93-205, approved December 28, 1973, 16 U.S.C. 1531 
et seq.
---------------------------------------------------------------------------

         Tariff Act of 1930, as Amended: Wild Mammals or Birds

    Section 527 of the Tariff Act of 1930, as amended,\30\ 
prohibits the importation of any wild mammal or bird, alive or 
dead, or any part of product of any wild mammal or bird, if the 
laws or regulations of the country where the wild mammal or 
birdlives restrict its ``talking, killing, possession, or 
exportation to the United States,'' unless the wild mammal or 
bird is accompanied by a certification of the U.S. consul that 
it ``has not be acquired or exported in violation of the laws 
or regulations of such country.  .  .''
---------------------------------------------------------------------------
    \30\ 19 U.S.C. 1527
---------------------------------------------------------------------------
    Any mammal or bird, alive or dead, or any part of product 
thereof, imported into the United States in violation of the 
above is subject to seizure and forfeiture under the customs 
laws. The import prohibition in the Tariff Act of 1930 does not 
apply in the case of (1) articles the importation of which is 
prohibited by any other law; (2) articles imported for 
scientific or educaional purposes, or are migratory; or (3) 
certain migratory game birds.

                   African Elephant Conservation Act

    Title II of the Endangered Species Act Amendments of 1988 
(Public Law 100-478) contained the African Elephant 
Conservation Act,\31\ requiring the Secretary of the Interior 
to establish a moratorium on the importation of raw and worked 
ivory from an ivory producing country that does not meet 
specific criteria, including being a party to the Convention on 
the International Trade in Endangered Species of Wild Fauna and 
Flora (CITES).
---------------------------------------------------------------------------
    \31\ 16 U.S.C. 4201-4245
---------------------------------------------------------------------------

       Rhinoceros and Tiger Conservation Act of 1994, as Amended

    Section 7 of the Rhinoceros and Tiger Conservation Act of 
1994,\32\ as amended by the Rhino and Tiger Product Labeling 
Act,\33\ prohibits selling, importing, or exporting, or 
attempting to sell, import, or export, any product, item or 
substance intended for human consumption containing or 
purporting to contain any substance derived from any species of 
rhinoceros or tiger.
---------------------------------------------------------------------------
    \32\ 15 U.S.C. 5301-5306.
    \33\ Public Law 105-312, approved October 30, 1998.
---------------------------------------------------------------------------

    Section 8 of the Fishermen's Protective Act of 1967, as amended 
                         (``Pelly Amendment'')

    Under section 8 of the Fishermen's Protective Act of 1967, 
as amended (the so-called ``Pelly Amendment''), \34\ the 
President, based on certain findings by the Secretary of 
Commerce or the Secretary of the Interior, has the 
discretionary authority to impose import sanctions on any 
products from any country which conducts fishery practices or 
engages in trade which diminishes the effectiveness of 
international programs for fishery conservation or 
international programs for endangered or threatened species.
---------------------------------------------------------------------------
    \34\ Public Law 93-205, approved December 28, 1973, 22 U.S.C. 1978.
---------------------------------------------------------------------------

              High Seas Driftnet Fisheries Enforcement Act

    The High Seas Driftnet Fisheries Enforcement Act was 
enacted in 1992 \35\ to assist in the international enforcement 
of U.N. Resolution Number 46-215, which prohibits 
large-scale driftnet fishing on the high seas after December 
31, 1992. The Act sets forth certain import sanctions 
applicable to countries whose nationals or vessels engage in 
driftnet fishing on the high seas on or after December 31, 
1992, and lays out the procedures to be followed in applying 
those import sanctions.
---------------------------------------------------------------------------
    \35\ Public Law 102-582, approved November 2, 1992.
---------------------------------------------------------------------------
    Specifically, the Act requires the Secretary of Commerce 
not later than December 31, 1992, and periodically thereafter, 
to identify each country the nationals or vessels of which 
conduct large-scale driftnet fishing beyond the exclusive 
economic zone of any country and to notify the President and 
that country of the identification. The President must enter 
into consultations within 30 days with any country so 
identified to obtain its agreement to effect the immediate 
termination of the large-scale driftnet fishing. If these 
consultations have not been satisfactorily concluded within 90 
days, the President shall direct the Secretary of the Treasury 
to prohibit the importation of shellfish, fish and fish 
products, and sport fishing equipment from the country in 
question. If such country has not terminated its large-scale 
driftnet fishing within 6 months after its identification or 
has retaliated against the United States for any initial import 
sanctions taken against it, such country shall be subject to 
additional import sanctions, at the President's discretion, 
under the Fishermen's Protective Act of 1967, as amended.

                   Wild Bird Conservation Act of 1992

    The Wild Bird Conservation Act of 1992 \36\ establishes 
various bans on the importation of exotic birds. For those 
birds listed on any of the three appendices on the Convention 
on International Trade in Endangered Species of Wild Fauna and 
Flora (CITES), the nature of the ban depends on how threatened 
is the particular species of bird. There is an immediate import 
ban for birds that have been identified under CITES as being 
under immediate threat. For all other birds listed by CITES, an 
import ban goes into effect 1 year after the date of enactment 
of the Act. During this 1 year, the Secretary of the Interior 
is authorized to suspend the importation of such species on an 
emergency basis under certain conditions. None of the import 
bans will apply to species of birds that are included on an 
approved list of species to be maintained by the Secretary. To 
be included on such an approved list, the species must either 
be regularly bred in captivity in a qualified facility or be 
protected under a conservation program in the country of origin 
that meets specifically enumerated criteria.
---------------------------------------------------------------------------
    \36\ Public Law 102-440, approved October 23, 1992.
---------------------------------------------------------------------------
    For exotic birds not listed under the CITES agreement, the 
Secretary is authorized to impose an import ban or quota on 
such species if he finds such action is necessary for the 
conservation of the species.
    The Act also authorizes the Secretary to allow, through the 
issuance of import permits, the importation of any exotic bird 
upon determination that such importation is not detrimental to 
the species' survival and that the bird is being imported for 
certain enumerated purposes, such as scientific research or 
cooperative breeding programs.

                 Atlantic Tunas Convention Act of 1975

    In 1966, the International Convention for the Conservation 
of Atlantic Tunas (ICCAT) was established, and the U.S. Senate 
ratified ICCAT in 1967. The Atlantic Tunas Convention Act 
(ATCA), which authorizes U.S. involvement in ICCAT, was enacted 
in 1975. ATCA authorizes the Secretary of Commerce to 
administer and enforce ICCAT and ATCA, including the 
promulgation of regulations to establish open and closed 
seasons, fish size requirements and catch limitations, 
incidental catch restrictions, and observer coverage. In 
addition, the Secretary is authorized to prohibit the entry 
into the United States of any fish subject to regulations 
recommended by ICCAT and taken in a manner which would diminish 
the effectiveness of ICCAT's conservation efforts.
    The Atlantic Tunas Convention Act of 1995 made certain 
changes to the ATCA concerning the identification and 
notification of countries violating the terms of ICCAT 
recommendation. Specifically, the legislation made no change to 
the ATCA authority to restrict imports of fish if fished in a 
manner that tends to diminish the effectiveness of a 
recommendation by the ICCAT, instead of imposing additional, 
and in some cases mandatory, standards. The Act added 
provisions requiring Commerce to identify, notify, and publish 
a list of countries whose fishing vessels are fishing or have 
fished during the previous year in the Convention area in a 
manner inconsistent with the objectives of an ICCAT 
recommendation. In addition, it provided that the President may 
enter into consultations with identified nations. The purpose 
of the Act was to lead to the development of an international 
consensus concerning multilateral management of Atlantic tunas, 
instead of expanding the circumstances under which unilateral 
sanctions are authorized.

     Section 609 of Public Law 101-162: Conservation of Sea Turtles

    Section 609 of Public Law 101-162, a bill making 
appropriations for the Departments of Commerce, Justice, State, 
the Judiciary, and related agencies for fiscal year 1990,\37\ 
calls upon the Secretary of State, in consultation with the 
Secretary of Commerce, to initiate negotiations for the 
development of bilateral or multilateral agreements for the 
protection and conservation of sea turtles, in particular with 
foreign governments of such countries which are engaged in 
commercial fishing operations likely to affect adversely sea 
turtles. Section 609 further provides that shrimp harvested 
with technology that may adversely affect certain sea turtles 
may not be imported into the United States, unless the 
President certified to Congress by May 1, 1991, and annually 
thereafter, that the harvesting nation has a regulatory program 
and an incidental rate comparable to that of the United States, 
or that the particular fishing environment of the harvesting 
nation does not pose a threat to sea turtles.
---------------------------------------------------------------------------
    \37\ Public Law 101-162, approved November 21, 1989.
---------------------------------------------------------------------------
    In 1991, the State Department issued guidelines for 
assessing the comparability of foreign regulatory programs with 
the U.S. program.\38\ To be found comparable, a foreign 
nation's program had to include a commitment to require all 
shrimp trawl vessels to use turtle excluder devices (TEDs) at 
all times, or alternatively, a commitment to engage in a 
statistically reliable and verifiable scientific program to 
reduce the mortality or sea turtles associated with shrimp 
fishing. The 1991 guidelines also determined that the scope of 
section 609 was limited to the wider Caribbean/western Atlantic 
region and that the import restriction did not apply to 
aquaculture shrimp, the harvesting of which does not adversely 
affect sea turtles.
---------------------------------------------------------------------------
    \38\ 56 Fed. Reg. 1051 (January 10, 1991).
---------------------------------------------------------------------------
    In 1993, the State Department issued revised guidelines 
providing that to receive a certification in 1993 and 
subsequent years, affected nations had to maintain their 
commitment to require TEDs on all commercial Shrimp trawl 
vessels by May 1, 1994.
     In December 1995, the U.S. Court of International Trade 
(CIT) found that the 1991 and 1993 guidelines were contrary to 
law in limiting the geographical scope of section 609 and 
directed the State Department to prohibit the importation of 
shrimp or products of shrimp wherever harvested in the wild 
with commercial fishing technology that may affect adversely 
sea turtles by May 1, 1996.\39\
---------------------------------------------------------------------------
    \39\ Earthe Island Institute v. Warren Christopher, 913 F. Supp. 
559 (CIT 1995).
---------------------------------------------------------------------------
    In April 1996, the State Department published revised 
guidelines \40\ to comply with the CIT order of December 1995. 
The new guidelines extended section 609 to shrimp harvested 
from all foreign nations. The State Department further 
determined that as of May 1, 1996, all shipments of shrimp and 
shrimp products into the United States were to be accompanied 
by a declaration attesting that the shrimp or shrimp product in 
question was harvested ``either under conditions that do not 
adversely affect sea turtles .  .  . or in waters subject to 
the jurisdiction of a nation currently certified pursuant to 
section 609.''
---------------------------------------------------------------------------
    \40\ 61 Fed. Reg. 17342 (April 19, 1996).
---------------------------------------------------------------------------
    In October 1996, the CIT ruled that the embargo on shrimp 
and shrimp products enacted by section 609 applied to all 
``shrimp products harvested in the wild by citizens or vessels 
of nations which have not be certified''.\41\ The Court found 
that the 1996 guidelines were contrary to section 609 when 
allowing, with a Shrimp Exporter's Declaration form, imports of 
shrimp from non-certified countries if the shrimp was harvested 
with commercial fishing technology that did not adversely 
affect sea turtles. The CIT also refused to postpone the 
worldwide enforcement of section 609.\42\
---------------------------------------------------------------------------
    \41\ Earth Island Institute v. Warren Christopher, 942 Fed. Supp. 
597 (CIT 1996).
    \42\ Earth Island Institute v. Warren Christopher, 948 Fed. Supp. 
1062 (CIT 1996).
---------------------------------------------------------------------------
    In 1997, Thailand, Malaysia, Pakistan, and India filed a 
challenge in the World Trade Organization (WTO) to the U.S. 
restrictions on imports of shrimp and shrimp products harvested 
in a manner harmful to endangered species of sea turtles. A 
dispute settlement panel was formed on February 25, 1997. The 
panel ruled in favor of the complainants on April 6, 1998, 
finding that the U.S. import restrictions were inconsistent 
with WTO rules. The United States appealed the decision, and on 
October 12, 1998, the Appellate Body of the WTO reversed the 
panel ruling, confirming that WTO rules allow countries to 
condition access to their markets on compliance with certain 
policies such as environmental conservation, and agreeing that 
the U.S. ``shrimp-turtle law'' was a permissible measure 
adopted for the purpose of sea turtle conservation. The 
Appellate Body, however, found fault with certain aspects of 
the U.S. implementation of the statute. In particular, it found 
that the State Department's procedures for determining whether 
countries meet the requirements of the law did provide adequate 
due process, because exporting nations were not afforded formal 
opportunities to be heard and were not given formal written 
explanations of adverse decisions. The Appellate Body also 
found that the United States had unfairly discriminated between 
the complaining countries and Western Hemisphere nations by not 
exerting as great an effort to negotiate a sea turtle 
conservation agreement with the complaining countries and by 
not providing them the same opportunities to receive technical 
assistance.
    On November 25, 1998, the United States indicated its 
intention not only to comply with the panel rulings but also 
the firm commitment of the United States to protect endangered 
species of sea turtles. In July 1999, the State Department 
revised its procedures, pursuant to the panel decision, to 
provide more due process to countries apply for certification 
under section 609. The United States also provided the 
complaining countries with additional technical assistance in 
the adoption of sea turtle conservation measures. In July 2000, 
the State Department began negotiations on a sea turtle 
conservation agreement with countries of the Indian Ocean 
region, including the complaining countries in the WTO case. 
The next meeting of negotiators is expected to take place 
during the first half of 2001.
    On October 23, 2000, Malaysia requested that the original 
WTO panel examine whether the United States fully implemented 
the panel's recommendations, arguing that it was necessary for 
the United States to repeal its ``shrimp-turtle law'' in order 
to comply. The other complaining countries in the WTO panel 
proceedings did not join Malaysia in the request. A decision on 
U.S. compliance with the panel report, which can be appealed to 
the WTO Appellate Body by either party, is expected in the 
spring of 2001.

                 National Security Import Restrictions


             Section 232 of the Trade Expansion Act of 1962

    Section 232 of the Trade Expansion Act of 1962, as 
amended,\43\ authorizes the President to impose restrictions on 
imports which threaten to impair the national security. This 
authority has been used by the President to impose quotas and 
fees on imports of petroleum and petroleum products from time 
to time and to embargo imports of refined petroleum products 
from Libya. Public Law 96-223 (imposing a windfall profit tax 
on domestic crude oil) amended section 232 to authorize the 
Congress to disapprove by joint resolution an action of the 
President to adjust oil imports. On June 9, 1995, the President 
found, pursuant to section 232, that oil imports threaten to 
impair the national security but determined not to take action 
to adjust imports of petroleum because the costs of such an 
adjustment to the economy outweighed the benefits.\44\
---------------------------------------------------------------------------
    \43\ Public Law 87-794, approved October 11, 1962, 19 U.S.C. 1862, 
amended by section 127 of the Trade Act of 1974, Public Law 93-618, 
approved January 3, 1975, by section 402 of the Crude Oil Windfall 
Profit Tax Act of 1980, Public Law 96-223, approved April 2, 1980, and 
further amended by section 1501 of the Omnibus Trade and 
Competitiveness Act of 1988, Public Law 100-418, approved August 23, 
1988.
    \44\ 60 Fed. Reg. 30,514 (June 9, 1995).
---------------------------------------------------------------------------
    On April 28, 2000, the President pursuant to section 232, 
concurred with the findings of the Secretary of Commence that 
imports of crude oil threaten to impair the national security. 
He also accepted the Secretary's recommendation that trade 
remedies not be imposed but that existing policies to enhance 
conservation and limit the dependence on foreign oil be 
continued.\45\
---------------------------------------------------------------------------
    \45\ 36 Weekly Comp. Pres. Doc. 945.
---------------------------------------------------------------------------
    Section 232 as amended requires the Secretary of Commerce 
to conduct immediately an investigation to determine the 
effects on national security of imports of an article, upon the 
request of any U.S. government department or agency, 
application of an interested party, or upon his own motion. The 
Secretary must report the findings of his investigation and his 
recommendations for action or inaction to the President within 
270 days after beginning the investigation. If the Secretary 
finds the article ``is being imported * * * in such quantities 
or under such circumstances as to threaten to impair the 
national security,'' he must so advise the President. The 
President must decide within 90 days after receiving the 
Secretary's report whether to take action. If the President 
decides to take action, he must implement such action within 15 
days, and take such action for such time as he deems necessary 
to ``adjust'' the imports of the article and its derivatives so 
imports will not threaten to impair the national security. The 
President must submit a written statement to the Congress 
within 30 days explaining action taken and the reasons 
therefor.
    Upon initiation of an investigation, the Secretary of 
Commerce must immediately notify the Secretary of Defense, and 
consult with him on methodological and policy questions. Upon 
request of the Secretary of Commerce, the Secretary of Defense 
must provide an assessment of the defense requirements of any 
article subject to investigation.
    The Secretary of Commerce must hold public hearings or 
otherwise afford interested parties an opportunity to present 
information and advice relevant to the investigation if it is 
appropriate and after reasonable notice. The Secretary must 
also seek information and advice from, and consult with, other 
appropriate agencies. Among the factors which the Secretary and 
the President must consider are domestic production needs for 
projected national defense requirements; domestic industry 
capacity to meet these requirements; existing and anticipated 
availability of resources, supplies, and services essential to 
the national defense; the growth requirements of such 
industries, supplies, services; imports in terms of their 
quantities, availability, character, and use as they affect 
such industries and U.S. capacity to meet national security 
requirements; the impact of foreign competition on the economic 
welfare of domestic industries; and any substantial 
unemployment, revenue declines, loss of skills or investment, 
or other serious effects resulting from displacement of any 
domestic products by excessive imports.

             Section 233 of the Trade Expansion Act of 1962

    Section 233 of the Trade Expansion Act of 1962 \46\ was 
added by section 121 of the Export Administration Amendments of 
1985 (Public Law 99-64) as a means of enforcing national 
security export controls imposed under that Act. The provision 
was amended by section 2447 of the Omnibus Trade and 
Competitiveness Act of 1988, to conform to sanctions authority 
added to the Export Administration Act.
---------------------------------------------------------------------------
    \46\ 19 U.S.C. 1864.
---------------------------------------------------------------------------
    Under section 233 as amended, any person who violates any 
national security export control imposed under section 5 of the 
Export Administration Act of 1979, or any regulation, order, or 
license issued under that section, may be subject to controls 
imposed by the President on imports of goods or technology into 
the United States.
    The provision has never been used.

                     Balance of Payments Authority


                  Section 122 of the Trade Act of 1974

    Section 122 of the Trade Act of 1974 \47\ authorizes the 
President to increase or reduce restrictions on imports into 
the United States to deal with balance of payments problems.
---------------------------------------------------------------------------
    \478\ Public Law 93-618, approved January 3, 1975; 19 U.S.C. 2132.
---------------------------------------------------------------------------
    Tighter restrictions in the form of an import surcharge 
(not to exceed 15 percent ad valorem), import quota, or a 
combination of the two may be imposed for up to 150 days 
(unless extended by act of Congress) whenever fundamental 
international payments problems make such restrictions 
necessary to deal with large and serious U.S. balance of 
payments deficits, to prevent an imminent and significant 
depreciation of the dollar, or to cooperate with other 
countries in correcting an international balance of payments 
disequilibrium.
    Existing imports restrictions may be eased for a period of 
up to 150 days (unless extended by act of Congress) through a 
reduction in the rate of duty on any article (not to exceed 5 
percent ad valorem), an increase in the value or quantity of 
imports subject to any type of import restriction, or a 
suspension of any import restriction. Such restrictions may be 
eased whenever fundamental international payments problems 
require special measures to deal with large and serious balance 
of payments surpluses or to prevent significant appreciation of 
the dollar. Trade liberalizing measures must be broad and 
uniform as to articles covered. The President may not, however, 
liberalize imports of those products for which increased 
imports will cause or contribute to material injury to domestic 
firms or workers, impairment of national security, or otherwise 
be contrary to the national interest.
    Certain conditions also are placed on the President's use 
of import restrictions for balance of payments purposes. Quotas 
may be imposed only if international agreements to which the 
United States is a party permit them as a balance of payments 
measure and only to the extent that the imbalance cannot be 
dealt with through an import surcharge. If the President 
determines that import restrictions are contrary to the 
national interest, he may refrain from imposing them but must 
inform and consult with Congress.
    Section 122(d) requires that import restrictions be applied 
on a non-discriminatory basis; it also requires that quotas aim 
to distribute foreign trade with the United States in a manner 
that reflects existing trade patterns. If the President finds, 
however, that the purposes of the provision would best be 
served by action against one or more countries with large and 
persistent balance of payment surpluses, he may exempt all 
other countries from such action. This section also expresses 
the sense of Congress that the President seek modifications in 
international agreements to allow the use of surcharges instead 
of quotas for balance of payments adjustment purposes. If such 
international reforms are achieved, the President's authority 
to exempt all but one or two surplus countries from import 
restrictions must be applied in a manner consistent with the 
new international rules.
    Section 122(e) provides that import restrictions be of 
broad and uniform application as to produce coverage, unless 
U.S. economic needs dictate otherwise. Exceptions under this 
section are limited to the unavailability of domestic supply at 
reasonable prices, the necessary importation of raw materials 
and similar factors, or if uniform restrictions will be 
unnecessary or ineffective (i.e., if products already are 
subject to import restrictions, are in transit, or are subject 
to binding contracts). The section prohibits the use of balance 
of payments authority or the exceptions authority to protect 
domestic industries from import competition. Any quantitative 
restriction imposed may not be more restrictive than the level 
of imports entered during the most recent representative 
period, and must take into account any increase in domestic 
consumption since the most recent representative period.
    The President is authorized to modify, suspend, or 
terminate any proclamation issued under the section, either 
during the initial 150-day period or during any subsequent 
extension by act of Congress.
    Section 122 authority has never been invoked.

Background

    Anticipating that oil-consuming nations would face large 
balance of payments deficits in an era of rapidly increasing 
oil prices, and believing that neither a reduction in the price 
of oil nor the necessary international monetary cooperation 
were certain to take place, Congress considered it necessary to 
authorize the President to impose surcharges or other import 
restrictions for balance of payments purposes, even though 
Congress assumed that under existing circumstances such 
authority was not likely to be used.\48\ The use of surcharges 
for balance of payments purposes had gained de facto acceptance 
among industrialized GATT member countries during the two 
decades preceding the 1974 Trade Act, but explicit GATT rules 
had never been adopted.
---------------------------------------------------------------------------
    \48\ Senate Report 93-1298 at 87-88.
---------------------------------------------------------------------------
    When it passed the Trade Act of 1974, Congress urged the 
President to seek changes in international agreements allowing 
the use of surcharges as well as (and in preference to) quotas 
for balance-of-payments adjustment purposes and providing rules 
for their use.\49\ The Tokyo Round of GATT multilateral trade 
negotiations in 1979 adopted, as part of the so-called 
Framework Agreement, the Declaration on Trade Measures Taken 
for Balance-of-Payments Purposes,\50\ which elaborated on the 
rules for the use of import restrictions for balance-of-
payments adjustments. While this Declaration noted the wide 
use, for balance-of-payments adjustments, of import 
restrictions other than quotas (which alone are addressed in 
the GATT) and implicitly sanctioned it, it still did not 
fundamentally alter GATT rules in this area by explicitly 
allowing such other restrictions.
---------------------------------------------------------------------------
    \49\ Senate Report 93-1298 at 88.
    \50\ MTN/FR/W/20/Rev. 2, reprinted in House Doc. 96-153, pt. I, at 
626.
---------------------------------------------------------------------------
    The balance-of-payments issue was revisited in the Omnibus 
Trade and Competitiveness Act of 1988, which stated as one of 
the principal negotiating objectives of the United States the 
development of ``rules to address large and persistent global 
current account imbalances of countries.'' \51\
---------------------------------------------------------------------------
    \51\ Public Law 100-418, section 122(d)(4), section 1101(b)(5); 19 
U.S.C. 2901(b)(5).
---------------------------------------------------------------------------
    The Understanding on the Balance-of-Payments Provisions of 
the General Agreements on Tariffs and Trade 1994 specifically 
provides for (and gives preference to) ``price-based measures'' 
for balance-of-payments adjustments, including import 
surcharges and deposit requirements, and limits the imposition 
of new quantitative restrictions. The Understanding also 
provides that preference should be given to those measures 
which have the least disruptive effect on trade, and that 
restrictive import measures taken for balance-of-payments 
purposes may only be applied to control the general level of 
imports, may not exceed what is necessary to address the 
balance-of-payments situation, and must be applied in a 
transparent manner. Finally, the Understanding sets forth 
consultation procedures for the use of all restrictive import 
measures taken for balance-of-payments purposes. Article XII of 
the General Agreement on Trade in Services permits members to 
adopt or maintain restrictions on trade in services in the 
event of serious balance-of-payments and external financial 
difficulties.\52\
---------------------------------------------------------------------------
    \52\ The United States prevailed in a WTO challenge to certain 
import restrictions by India on more than 2,700 tariff items. The WTO 
found that these restrictions were no longer justified under the 
balance-of-payments exceptions. India agreed to remove all restrictions 
by April 2001.
---------------------------------------------------------------------------

                           Product Standards

    U.S. policy regarding the application of standards and 
certification procedures to imported products is based on the 
Uruguay Round Agreement on Technical Barriers to Trade and its 
U.S. implementing legislation as part of the Uruguay Round 
Agreements Act,\53\ chapter 9 of the North American Free Trade 
Agreement and its U.S. implementing legislation as part of the 
North American Free Trade Agreement Implementation Act,\54\ and 
the Agreement on Technical Barriers to Trade under the General 
Agreement on Tariffs and Trade (GATT) and its U.S. implementing 
legislation under title IV of the Trade Agreement Act of 
1979.\55\
---------------------------------------------------------------------------
    \53\ Public Law 103-465, approved December 8, 1994.
    \54\ Public Law 103-182, approved December 8, 1993.
    \55\ Public Law 96-39, approved July 26, 1979, 19 U.S.C. 2531-2573.
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    Differences in product standards, listing and approval 
procedures, and certification systems often can impede trade 
and can be manipulated to discriminate against imports. Imports 
may be tested to determine whether they conform with domestic 
standards under conditions more onerous than those applicable 
to domestic products. Certification systems, which indicate 
whether products conform to standards, may limit access for 
imports or may discriminate by denying the right of a 
certification mark on imported products. Prior to the 1979 
Agreement, however, there was virtually no multilateral 
cooperation or supervision to promote international 
harmonization and to discourage nationalistic discriminatory 
practices.

                Agreement on Technical Barriers to Trade

    The Agreement on Technical Barriers to Trade,\56\ commonly 
referred to as the Standards Code, was one of the agreements on 
non-tariff measures concluded during the 1973-1979 Tokyo Round 
of GATT multilateral trade negotiations. The Code went into 
force on January 1, 1980. The Code does not attempt to create 
standards for individual products, or to set up specific 
testing and certification systems. Rather, it establishes, for 
the first time, international rules among governments 
regulating the procedures by which standards and certification 
systems are prepared, adopted and applied, and by which 
products are tested for conformity with standards. The Code was 
a major U.S. negotiating objective during the Tokyo Round, 
particularly given the formation of a European regional 
electrical certification system closed to outside suppliers.
---------------------------------------------------------------------------
    \56\ MTN/NTM/W/192 Rev. 5, reprinted in House Doc. No. 96-153, pt. 
I, at 211.
---------------------------------------------------------------------------
    The Standards Code seeks to eliminate national product 
standardization and testing practices and certification 
procedures as barriers to trade among the signatory countries 
and to encourage the use of open procedures in the adoption of 
standards. At the same time, it does not limit the ability of 
countries to reasonably protect the health, safety, security, 
environment, or consumer interests of their citizens. 
Generally, U.S. standards-setting processes have followed these 
basic norms, whereas other countries' standards-related 
activities have generally been closed to participation from 
foreign countries; these signatories are obliged to change 
their practices in order to comply with Code principles.
    The Code's provisions are applicable to all products, both 
agricultural and industrial. They are not applicable to 
standards involving services, technical specifications included 
in government procurement contracts, or standards established 
by individual companies for their own use. The Code addresses 
governmental and non-governmental standards, both voluntary and 
mandatory, developed by central governments, state and local 
governments, and private sector organizations. Only central 
governments, however, are directly bound by Code obligations, 
whereas regional, state, local, and private organizations are 
subject to a second level of obligation whereby signatories 
``shall take such reasonable measures as may be available to 
them'' to ensure compliance.
    The Code is prospective, applying to new and revised 
standards-related activities. If a signatory country believes, 
however, that an existing regulation developed and put into 
effect before the Code came into force conflicts with the basic 
tenets of the Code, then that signatory may use the Code's 
dispute settlement mechanism to help resolve the problem.
    The Standards Code contains the following key provisions 
obligating signatories to follow several general principles 
pertaining to standards-related activities:
          (1) The most important and fundamental principle 
        obligates signatory governments not to develop, 
        intentionally or unintentionally, product standards, 
        technical regulations, or certification systems which 
        create unnecessary obstacles to foreign trade. The Code 
        recognizes nations' sovereign right to formulate 
        standards and certification systems to protect life, 
        health and environment, but such regulations should be 
        as least disruptive as possible to international trade.
          (2) The second fundamental principle is that national 
        or regional certification systems are to grant access 
        to foreign or non-member signatory suppliers under 
        conditions no less favorable than those granted to 
        domestic or member country suppliers, a major change in 
        most signatory policies. Signatories can no longer 
        refuse to give their national certification marks to 
        imported products, provided that the imported products 
        fully meet the technical requirements of the 
        certification system. Also regional certification 
        bodies must be open to suppliers from all Code 
        signatories.
          (3) Signatories must provide foreign imported 
        products the same treatment as domestic goods with 
        respect to standards, technical regulations, and 
        testing and certification procedures, i.e., an 
        extension of the national treatment provision of GATT 
        which prohibits discrimination against imported 
        products.
          (4) When developing new or revising existing product 
        standards or technical regulations, governments are to 
        use existing or proposed international standards as the 
        basis where it is appropriate. Other signatories may 
        request an explanation if a government fails to follow 
        this principle.
          (5) Whenever appropriate, signatories are encouraged 
        to specify technical regulations and standards in terms 
        of performance rather than design or descriptive 
        characteristics.
    If a foreign product must be tested to determine whether it 
meets domestic standards before it can be imported, the Code 
provides a number of criteria that signatories are to follow to 
ensure non-discriminatory treatment. For example, foreign goods 
should not have to undergo costlier or more complex testing 
than domestic products in comparable situations. In addition, 
signatories are obligated to use the same methods and 
administrative procedures on imported as well as domestic 
goods. The Code does not obligate signatories to recognize test 
results or certification marks from another country. It does, 
however, encourage signatories to accept, whenever possible, 
test results, certifications or marks of conformity from 
foreign bodies, or self-certification from foreign producers 
even when the test methods differ from their own, provided that 
the importing country is satisfied that the exporting country's 
products meet the required standards.
    Another important element of the Standards Code is the 
obligation of signatories to open up the process of developing 
or applying standards and certification procedures to each 
other. Governments must make available proposed mandatory or 
voluntary standards and certification procedures for comment 
during the drafting stage by other signatories before they 
become final regulations. Each signatory government must 
establish an inquiry point to respond to all reasonable 
questions from other signatories concerning their central, 
local, and state government standards and certification 
procedures.
    Finally, the Code establishes a Committee of Signatories 
which meets periodically to oversee implementation and 
administration of the Agreement, as well as to discuss any new 
issues or problems which arise. The Committee may set up panels 
of experts or working parties as required to conduct Committee 
business or handle disputes.

         Uruguay Round Agreement on Technical Barriers to Trade

    As part of the Uruguay Round, the signatories built on 
experience gained under the 1979 Standards Code in the 
Agreement on Technical Barriers to Trade (TBT Agreement). Much 
of the new Agreement restates, clarifies, or expands the 1979 
Code.
    The inclusion of the new Agreement as one of the WTO 
agreements means that all WTO members will be automatically 
bound by the Agreement, whereas a number of countries had 
chosen not to join the Standards Code. In addition, the 
Agreement will be enforceable through the WTO Dispute 
Settlement Understanding, unlike the 1979 Code, which contained 
a separate procedure limiting response to Code violations to 
withdrawing concessions under the Code.
    The new Agreement seeks to eliminate barriers in the form 
of national product standardization and testing practices and 
conformity assessment procedures. At the same time, it permits 
signatories to protect the health, safety, security, 
environment, or consumer interests of their citizens. Like the 
1979 Code, the Agreement obligates signatories to take 
reasonable measures to secure compliance by local government 
and non-governmental bodies.
    With respect to technical regulations, the Agreement 
establishes rules covering the preparation, adoption, and 
application of technical regulations. The Agreement specifies 
that technical regulations are not to be more trade-restrictive 
than necessary to fulfill a legitimate objective. A complaining 
member must identify a specific alternative measure that is 
reasonably available. In addition, each government is required 
to review periodically its technical regulations in light of 
the Agreement's requirements. Each government is to use 
relevant international standards as a basis for technical 
regulations, except where they would be an ineffective or 
inappropriate means to fulfill the government's legitimate 
objectives. The Agreement recognizes the concept of equivalency 
between countries' technical regulations. It carries forward 
the procedural requirements of the Code to assure transparency. 
Finally, it reflects an expansion beyond the Code with respect 
to the issuance of technical regulations by local and non-
governmental bodies. WTO members must provide notice of 
technical regulations issued by local bodies at the next level 
below central governments, and must take active measures in 
support of observance by local government and non-governmental 
bodies.
    With respect to standards, central government bodies are 
required to comply with the terms of the Code of Good Practice 
for the Preparation, Adoption and Application of Standards. 
Other standardizing bodies are not bound by the Code of Good 
Practice, but each central government must take reasonable 
measures to ensure their compliance.
    The new Agreement updates and expands disciplines regarding 
conformity assessment procedures. Whereas the 1979 Code applied 
only to testing, the new Agreement applies to all aspects of 
conformity assessment, including laboratory accreditation and 
quality system registration. Central governments are required 
to take reasonable measures to apply these same disciplines to 
local governments and non-governmental bodies.
    The Agreement on the Application of Sanitary and 
Phytosanitary Measures (S&P Agreement) establishes a number of 
general requirements and procedures to ensure that a sanitary 
or phytosanitary measure is in fact to protect human, animal, 
and plant life and health from risks of plant- or animal-borne 
pests or diseases, or additives, contaminants, toxins, or 
disease-causing organisms in foods, beverages, or feedstuffs. 
While the TBT Agreement relies on a non-discrimination test, 
the S&P Agreement relies on whether a measure has a basis in 
science and is based on a risk assessment. Discrimination is 
allowed as long as it is not arbitrary or unjustifiable.

                The North American Free Trade Agreement

    Chapter 9 of the NAFTA establishes rules on standards-
related measures among the United States, Mexico, and Canada. 
The provisions are based on the text of the then-draft Uruguay 
Round Agreement on Technical Barriers to Trade and the United 
States-Canada Free-Trade Agreement. The rules apply only to 
standards-related measures that may directly or indirectly 
affect trade in goods or services between the NAFTA countries 
and to measures taken by NAFTA countries concerning those 
standards-related measures. In addition, chapter 7 of the NAFTA 
covers sanitary and phytosanitary measures.

        Title IV of the Trade Agreements Act of 1979, as amended

    Congress approved the Agreement on Technical Barriers to 
Trade under section 2 of the Trade Agreements Act of 1979. 
Title IV of that Act implements the obligations of the 
Standards Code in U.S. law.\57\ Since U.S. practices were 
already in conformity with the Code, title IV did not amend, 
repeal, or replace any existing law. It does ensure that 
adequate structures exist within the federal government to 
inform the U.S. private sector about the standards-related 
activities of other nations, facilitate the ability of the 
United States to comment on foreign standards-making and 
certifications, and process domestic complaints on foreign 
practices. Title IV was then amended to reflect U.S. 
obligations under the Uruguay Round Agreement on Technical 
Barriers to Trade and the NAFTA.
---------------------------------------------------------------------------
    \57\ 19 U.S.C. 2531-2573.
---------------------------------------------------------------------------
    Section 402 of the 1979 Act requires all federal agencies 
to abide by the above-described principles and provisions of 
the Agreement. In addition, section 403 states the ``sense of 
Congress'' that no State agency and no private person should 
engage in any standards-related activity, i.e., development or 
implementation of product standards or certification system, 
that creates unnecessary obstacles to foreign trade, and 
requires the President to ``take such reasonable measures as 
may be available'' to promote their observance of Agreement 
obligations.
    The U.S. Trade Representative (USTR) is designated to 
coordinate U.S. trade policies related to standards, and 
discussions and negotiations with foreign countries on 
standards issues, and to oversee implementation of the 
Agreement. The Departments of Agriculture and Commerce are 
required to work with the USTR on agricultural and non-
agricultural issues respectively and to establish technical 
offices to fulfill a number of functions, particularly 
supplying notices to interested parties of proposed foreign 
government standards and receiving and transmitting private 
sector comments. The Department of Commerce maintains the 
National Center for Standards and Certification within the 
National Bureau of Standards as the national inquiry point 
required under the Code.
    Title IV contains provisions concerning administrative and 
judicial proceedings regarding standards-related activities. No 
private rights of action are created by title IV; private 
parties can petition the U.S. government to invoke provisions 
of the Agreement against practices of other signatories.
    Subtitle E sets forth governing standards and measures 
under the NAFTA. Subtitle F contains provisions concerning U.S. 
participation in international standardsetting activities.

                         Government Procurement

    U.S. policy on government purchases of foreign goods and 
services is based on the Buy American Act of 1933,\58\ the 
multilateral Agreement on Government Procurement under the 1994 
WTO and General Agreement on Tariffs and Trade (GATT), and its 
implementing legislation under title III of the Trade 
Agreements Act of 1979,\59\ as amended by the Uruguay Round 
Agreements Act. The ``Buy American Act of 1988'' (title VII of 
the Omnibus Trade and Competitiveness Act of 1988) \60\ 
established standards and procedures to prohibit procurement 
from foreign countries whose governments discriminate against 
U.S. products or services in awarding contracts. In addition, 
separate provisions in appropriation acts and other legislation 
apply more restrictive Buy American-type provisions on 
particular types of purchases.
---------------------------------------------------------------------------
    \58\ Act of March 3, 1933, ch. 212, title III, 47 Stat. 1520, 41 
U.S.C. 10a-10d.
    \59\ Public Law 96-39, title III, approved July 26, 1979, 19 U.S.C. 
2511-2518.
    \60\ Public Law 100-418, title VII, approved August 23, 1988, 41 
U.S.C. 10a note.
---------------------------------------------------------------------------
    Governments are among the world's largest purchasers of 
non-strategic goods. Most of this vast market has traditionally 
been closed to foreign producers by means of formal and 
informal administrative systems of national discrimination in 
favor of domestic producers. Although U.S. preferences for 
domestic suppliers are clearly set out by law and regulation, 
other countries usually have achieved their discrimination by 
highly invisible administrative practices and procedures.

                            Buy American Act

    The Buy American Act of 1933, as implemented by Executive 
Orders 10582 and 11051, requires the U.S. government to 
purchase domestic goods and services unless the head of the 
agency or department involved determines the prices of the 
domestic supplies are ``unreasonable'' or their purchase would 
be inconsistent with the U.S. public interest. Executive Order 
10582, issued in 1954, states that if the domestic price of a 
good or service is 6 percent or more above the foreign price, 
then it is to be considered unreasonable and the foreign 
product may be purchased. The order also permits agencies to 
use a differential above 6 percent if it would serve the 
national interest. The Department of Defense has been using a 
50 percent differential since 1962 for its procurement, except 
this differential is waived on military purchases under 
reciprocal Memoranda of Understanding (MOUs) with NATO 
countries. The order also indicated that a differential could 
be applied in cases where a domestic bid generated employment 
in a labor surplus area as designated by the Secretary of 
Labor. No specific percentage was stated, but generally a 12 
percent differential has been allowed for bids which benefit 
economically distressed areas. These price differentials may be 
waived under section 301(a) of the Trade Agreements Act of 1979 
for articles covered by the GATT Agreement on Government 
Procurement from signatory countries.
    U.S.-made products are defined by law as those manufactured 
in the United States substantially all from articles, 
materials, or supplies mined, produced, or manufactured in the 
United States. By regulations, ``substantially all'' has been 
defined to mean that more than 50 percent of the component 
costs of a product has been incurred in the United States.

             1979 GATT Agreement on Government Procurement

    The first Agreement on Government Procurement, also known 
as the Government Procurement Code,\61\ was concluded as one of 
the agreements on non-tariff measures during the 1975-1979 
Tokyo Round of GATT multilateral trade negotiations. The Code 
went into effect on January 1, 1981 and remained in force until 
the 1994 WTO Agreement on Government Procurement went into 
effect on January 1, 1996.
---------------------------------------------------------------------------
    \61\ MTN/NTM/W/211/Rev. 2, reprinted in House Doc. No. 96-153, pt. 
I, at 69.
---------------------------------------------------------------------------
    Because not all objectives were achieved in the original 
Code and revisions might be necessary in light of actual 
experience, the signatories agreed to renegotiations beginning 
at the end of 1984 to broaden the coverage and improve the 
operation of the Code. The GATT Committee on Government 
Procurement completed the first phase of these renegotiations 
in November 1986 with agreement (1) on a Protocol of Amendments 
to improve the functioning of the Code, effective January 1, 
1988; (2) to continue negotiations on increasing the number of 
entities (government agencies) and procurements covered by the 
Code, particularly in the sectors of telecommunications, heavy 
electrical and transportation equipment; and (3) to continue to 
work towards the coverage of service contracts under the Code. 
The second phase of Code renegotiations began in February 1987 
and continued in the context of the Uruguay Round of GATT 
multilateral trade negotiations.
    The 1979 Code is designed to discourage discrimination 
against foreign suppliers at all stages of the procurement 
process, from the determination of the characteristic of the 
product to be purchased to tendering procedures, to contract 
performance. The Code prescribes specific rules on the drafting 
of the specifications for goods to be purchased, advertising of 
prospective purchases, time allocated for the submission of the 
bids, qualification of suppliers, opening and evaluation of 
bids, awards of contracts, and on hearing and reviewing 
protests.
    Signatories must publish their procurement laws and 
regulations and make them consistent with the Code rules. 
Purchasing entities have discretion in their choice of 
purchasing procedures, provided they extend equitable treatment 
to all suppliers and allow the maximum degree of competition 
possible.
    Each government agency covered by the Code is required to 
publish a notice of each proposed purchase in an appropriate 
publication available to the public, and to provide all 
suppliers with enough information to permit them to submit 
responsive tenders. Losing bidders must be informed of all 
awards and be provided upon request with pertinent information 
concerning the reasons they were not selected and the name and 
relative advantages of the winning bidder. Signatories must 
also provide data on their procurements on an annual basis.
    The adoption or use of technical specifications which act 
to create unnecessary obstacles to international trade is 
prohibited. The Code mandates the use, where appropriate, of 
technical specifications based on performance rather than 
design, and of specifications based on recognized national or 
international standards.
    While the Code does not prohibit the granting of an offset 
or the requirement that technology be licensed as a condition 
of award, signatories recognize that offsets and requirements 
for licensing of technology should be limited and used in a 
non-discriminatory way.
    The Code is largely self-policing. Rules and procedures are 
structured to help provide solutions to problems between 
potential suppliers and procuring agencies. As a next step, the 
Code provides for bilateral consultations between the procuring 
government and the government of the aggrieved supplier. As a 
last resort, the Code dispute settlement mechanism under the 
Committee of Signatories provides for conciliation or 
establishment of a fact-finding panel.

Coverage of the agreement

    The Code applies solely to those agencies listed by each 
signatory in an annex on contracts valued above a specific 
minimum contract value expressed in terms of Special Drawing 
Rights (SDR). The original Code established a threshold value 
of 150,000 SDR; the 1988 Protocol of Amendments to the Code 
lowered the minimum contract value to SDR 130,000.
    The benefits of the Code apply to purchases of goods 
originating in the territory of signatory countries. As a 
result of the 1988 amendments, leasing contracts are also 
subject to the Code. It does not apply to government services 
except those incidental to the purchase of goods, construction 
contracts, purchases by Ministries of Agriculture for farm 
support programs or human feeding programs such as the U.S. 
school lunch program. Procurements by state and local 
governments, including those with federal funds such as under 
the Surface Transportation Act, are not subject to the Code.
    For the United States, the Code does not apply to the 
Department of Transportation, the Department of Energy, the 
Tennessee Valley Authority, the Corps of Engineers of the 
Department of Defense, the Bureau of Reclamation of the 
Department of the Interior, and the Automated Data and 
Telecommunications Service of the General Services 
Administration (GSA). In addition, government chartered 
corporations which are not bound by the Buy American Act, such 
as the U.S. Postal Service, COMSAT, AMTRAK, and CONRAIL, are 
not covered.
    United States Code coverage also does not apply to set-
aside programs reserving purchases for small and minority 
businesses, prison and blind-made goods, or to the requirements 
contained in Department of Defense and GSA Appropriations Acts 
that certain products (i.e., textiles, clothing, shoes, food, 
stainless steel flatware, certain specialty metals, buses, hand 
tools, ships, and major ship components) be purchased only from 
domestic sources.
    On April 13, 1993, the United States and European Union 
reached an agreement in Marrakesh under the GATT Government 
Procurement Code to nearly double to $200 billion the bidding 
opportunities available on a bilateral basis.

              1994 WTO Agreement on Government Procurement

    The 1994 Government Procurement Agreement negotiated in the 
Uruguay Round makes important improvements in the Tokyo Round 
Code, which required central government agencies in member 
countries to observe non-discriminatory, fair, and transparent 
procedures in the purchase of certain goods. The new Agreement 
covers the procurement of both goods and services, including 
construction services, and applies to purchases by subcentral 
governments and government-owned enterprises, as well as 
central governments.
    In addition to improvements in coverage, the Agreement also 
requires members to follow significantly improved procurement 
procedures. It prohibits the use of offsets unless a country 
specifically negotiates an exception to the Agreement in its 
schedule. The Agreement requires the establishment of a 
domestic bid challenge system and introduces added flexibility 
to accommodate advances in procurement techniques.
    The Agreement allows each signatory to negotiate coverage 
on a reciprocal, bilateral basis with the other signatories. 
The United States concluded comprehensive coverage packages 
with several countries. The United States will apply the new 
Agreement to specified U.S. subcentral governments and 
government-owned entities only for those countries that opened 
their government procurement markets in sectors of high 
priority to the United States, although it may expand coverage 
with other signatories in the future.
    The Agreement applies to purchases by government entities 
above certain special drawing right (SDR) thresholds:
          Central government purchases
                  Goods and services: 130,000 SDRs ($182,000)
                  Construction services: 5 million SDRs ($7 
                million)
          Subcentral government purchases
                  Goods and services, U.S. and Canada: 355,000 
                SDRs ($500,000)
                  Goods and services, other: 200,000 SDRs 
                ($280,000)
                  Construction services, Japan and Korea: 15 
                million SDRs ($21 million)
                  Construction services, other: 5 million SDRs 
                ($7 million)
          Government-owned enterprise purchases
                  Goods and services, U.S. federally-funded 
                utilities: $250,000
                  Goods and services, other: 400,000 SDRs 
                ($560,000)
                  Construction services, Japan and Korea: 15 
                million SDRs ($21 million)
                  Construction services, other: 5 million SDRs 
                ($7 million)
    During the negotiations, each signatory negotiated the 
exclusion of certain procurement from the obligations imposed 
by the new Agreement. In the case of the United States, these 
exclusions carry forward those in the U.S. schedule to the 1979 
Code. In addition, certain states excluded specified 
procurement, and set-asides on behalf of small and minority 
businesses are also excluded. The 1994 Agreement applies to all 
U.S. executive branch agencies with certain exceptions, 
including the Federal Aviation Administration.
    Signatories to the 1996 Code include the following members 
of the 1979 Code--Austria, Belgium, Canada, Denmark, European 
Communities, Finland, France, Germany, Greece, Hong Kong, 
Iceland, Ireland, Israel, Italy, Japan, Korea, Liechtenstein, 
Luxembourg, Netherlands, Netherlans with respect to Aruba, 
Norway, Portugal, Singapore, Spain, Sweden, Switzerland, United 
Kingdom, and the United States. The United States terminated 
its participation in the 1979 Code on the entry into force of 
the 1996 Code.

                The North American Free Trade Agreement

    The NAFTA signatories agreed to eliminate buy national 
restrictions on the majority of non-defense related purchases 
by their federal governments of goods and services provided by 
firms in North America. The Agreement marked the first time 
that Mexico had committed to eliminate discriminatory 
government procurement practices.
    The Agreement applies only to purchases above a specified 
threshold:
          (1) Purchases of goods over $25,000 by U.S. federal 
        agencies from Canadian suppliers and vice versa;
          (2) For other federal government procurement in the 
        three countries, purchases of goods and services over 
        $50,000 and purchases of construction services over 
        $6.5 million; and
          (3) For federal government-owned enterprises, 
        purchases of goods and services over $250,000 and 
        purchases of construction services over $8 million.
    The Agreement does not apply to certain kinds of purchases 
by the U.S. government including purchases under small or 
minority business set-aside programs, certain national 
security, agriculture, and Agency for International Development 
procurements, and procurements by state and local governments.

       Title III of the Trade Agreements Act of 1979, as amended

    Congress approved the first Agreement on Government 
Procurement under section 2 of the Trade Agreements Act of 1979 
and amended that statute in the Uruguay Round and NAFTA 
implementing bills to reflect U.S. obligations under those 
agreements. Title III of that Act implements the obligations of 
the Code in U.S. law with respect to purchases by covered 
government entities.\62\
---------------------------------------------------------------------------
    \62\ 19 U.S.C. 2511-2518.
---------------------------------------------------------------------------
    Executive Order 12260, issued on December 31, 1980, 
requires all U.S. government agencies covered by the Code to 
observe its provisions. Section 301 of the 1979 Act authorizes 
the President to waive the application of discriminatory 
government procurement law, such as the Buy American Act, and 
labor surplus set-asides that are not for a small business. The 
waiver authority applies only to purchases covered by the Code 
and only to foreign countries designated by the President that 
meet one of four statutory conditions basically requiring the 
country to provide appropriate reciprocal, competitive 
government procurement opportunities to U.S. products and 
suppliers, unless the country is a least developed country.
    Buy American Act preferences still apply to contracts below 
the SDR threshold, purchases by non-covered entities, and 
procurement from countries not eligible for a waiver regardless 
of contract size. Special Buy American-type restrictions under 
other laws (e.g., small business set asides, required domestic 
sourcing of particular goods) are also not affected.
    Section 302 of the 1979 Act, as amended, is designed to 
encourage other countries to participate in the Code and 
provide appropriate reciprocal competitive opportunities. For 
this purpose, the President is required, after the date on 
which any waiver first takes effect, to prohibit the 
procurement of products otherwise covered by the Code from non-
designated countries. The President may, however, (1) waive the 
prohibition on procurement of products by a foreign country or 
instrumentality that has not yet become a party to the 
Agreement but has agreed to apply transparent and competitive 
procedures to its government procurement equivalent to those in 
the Agreement and to maintain and enforce effective 
prohibitions on bribery and other corrupt practices in 
connection with government procurement; (2) authorize agency 
heads to waive prohibitions on a case-by-case basis when in the 
national interest; and (3) authorize the Secretary of Defense 
to waive the prohibition for products of any country which 
enters into a reciprocal procurement agreement with the 
Department of Defense. All such waivers are subject to 
interagency review and general policy guidance.
    Section 303 authorizes the President to waive as of January 
1, 1980 the application of the Buy American Act for purchases 
by any government entity of civil aircraft and related articles 
irrespective of value from countries party to the GATT 
Agreement on Trade in Civil Aircraft.
    Section 304 sets forth negotiating objectives in 
conjunction with the renegotiation of the Code within 3 years 
to improve its operation and broaden the coverage. This 
negotiation is ongoing. The President is directed to seek more 
open and equitable foreign market access and the harmonization, 
reduction, or elimination of devices distorting government 
procurement trade. The President must also seek equivalent 
competitive opportunities in developed countries for U.S. 
exports in appropriate product sectors as the United States 
affords their products, such as in the heavy electrical, 
telecommunications, and transport equipment sectors. The 
President must report to the committees of jurisdiction during 
the renegotiations if he determines they are not progressing 
satisfactorily and are not likely to result within 12 months in 
expanded agreement coverage of principal developed country 
purchasers in appropriate product sectors. The President is 
also directed to indicate appropriate actions to seek sector 
reciprocity with such countries in government procurement, and 
may recommend legislation to prohibit procurement by entities 
not covered by the Code from such countries.
    Title III of the 1979 Act, as amended, also contains a 
number of reporting requirements to the Congress on various 
aspects of the Code and its economic impact and implementation.

  Title VII of the Omnibus Trade and Competitiveness Act of 1988, as 
                                amended


Background

    Title VII of the Omnibus Trade and Competitiveness Act of 
1988 (``Buy American Act of 1988'') \63\ as amended by the 
Uruguay Round Agreements Act, amended both the Buy American Act 
of 1933 and title III of the Trade Agreements Act of 1979 to 
address discrimination by foreign governments in the 
procurement of U.S. products or services. Title VII statutory 
authority ceased to be effective on April 30, 1996. On March 
31, 1999, President Clinton issued Executive Order 13116, which 
reinstituted Title VII procedures.
---------------------------------------------------------------------------
    \63\ 41 U.S.C. 10a note.
---------------------------------------------------------------------------
    Title VII prohibits U.S. government procurement of products 
and services from certain parties, including (1) signatories 
``not in good standing'' to the Agreement; (2) signatories in 
good standing that discriminate against U.S. firms in their 
government procurement of products or services not covered by 
the Agreement; and (3) non-signatories to the Agreement whose 
governments discriminate against U.S. products or services in 
their procurement.
    In the case of countries that discriminate on procurement 
not covered by the Agreement, prohibitions are to be imposed 
when a foreign government maintains a significant and 
persistent pattern or practice of discrimination against 
procurement of U.S. products or services that results in 
identifiable harm to U.S. business. In cases of signatories to 
the Agreement, federal agencies would be prohibited from 
procuring only non-Agreement covered products from these 
countries unless that country has also been designated as a 
country ``not in good standing.''
    Least developed countries are exempt from the procurement 
prohibition, as are products and services procured and used by 
the federal government outside the United States and its 
territories. A prohibition may also be waived, on a contract-
by-contract or class of contracts basis, when in the public 
interest or to avoid the creation of a monopoly situation. The 
President or head of a federal agency may also authorize the 
award of a contract or class of contracts, notwithstanding a 
prohibition, if insufficient competition exists to assure the 
procurement of products or services of requisite quality at 
competitive prices. Normally the Congress must be notified at 
least 30 days before the prohibition is waived on a contract or 
class of contract.
    The President must submit to appropriate congressional 
committees, by April 30 each year, a report on the extent to 
which countries discriminate against U.S. products or services 
in making government procurements. The report must identify (1) 
signatories to the Agreement that are not in compliance with 
its requirements; (2) signatories to the Agreement whose 
products and services are acquired in significant amounts by 
the U.S. government, who are in compliance with the Agreement, 
but maintain a significant and persistent pattern or practice 
of discrimination in the government procurement of products and 
services not covered by the Agreement which results in 
identifiable harm to U.S. businesses; (3) non-signatories to 
the Agreement whose products or services are acquired in 
significant amounts by the U.S. government and who maintain in 
their government procurement a significant and persistent 
pattern or practice of discrimination which results in 
identifiable harm to U.S. businesses; (4) non-signatories to 
the Agreement, which fail to apply transparent and competitive 
procedures equivalent to those in the Agreement, and whose 
products and services are required in significant amounts by 
the U.S. government; and (5) non-signatories to the Agreement 
which fail to maintain and enforce effective prohibitions on 
bribery and other corrupt practices in connection with 
government procurement, and whose products and services are 
required in significant amounts by the U.S. government. The law 
requires the President to take into account a number of 
specific factors in identifying countries and to describe the 
practices and their impact in the annual report.
    By the date the annual report is submitted, the U.S. Trade 
Representative (USTR) must request consultations with any 
identified country, unless that country was also identified in 
the preceding annual report. If the country is a signatory 
identified as not in compliance with the Agreement and does not 
comply within 60 days after the annual report is issued, the 
USTR must request formal dispute settlement proceedings under 
the Agreement, unless they are already underway pursuant to a 
previous identification. If dispute settlement is not concluded 
within 18 months or has concluded and the country has not taken 
action required as a result of the procedures to the 
satisfaction of the President, the country is considered ``not 
in good standing'' and the President is required to revoke the 
waiver of Buy American restrictions granted under the Trade 
Agreements Act of 1979, as amended. The President will not 
limit procurement from the foreign country if, before the end 
of 18 months following initiation of dispute settlement, the 
country has complied with the Agreement, has taken action 
recommended as a result of the procedures to the satisfaction 
of the President, or the procedures result in a determination 
requiring no action by the country. The President may also 
terminate the sanctions and reinstate a waiver at any time 
under such circumstances.
    Within 60 days after the annual report is issued, the 
President must impose the procurement prohibition on any 
country identified as discriminating on procurements not 
covered by the Agreement and which has not eliminated its 
discriminatory procurement practices. The President may 
terminate the sanctions at such time as he determines the 
country has eliminated the discrimination.
    With respect to either category of countries, if the 
President determines that imposing or continuing the sanctions 
would harm the U.S. public interest, the President may modify 
or restrict the application of the sanctions to the extent 
necessary to impose appropriate limitations that are equivalent 
in their effect to the discrimination against U.S. products or 
services in government procurement by that country. The 
President also cannot impose sanctions if it would (1) limit 
U.S. government procurement to, or create a preference for, 
products or services of a single supplier; or (2) create a 
situation where there could be or are an insufficient number of 
actual or potential bidders to assure U.S. government 
procurement of goods or services of requisite quality at 
competitive prices.
    By April 30 of each year, the President must submit to the 
Congress a general report on actions taken under title VII, 
including an evaluation of the adequacy and effectiveness of 
such actions as a means toward eliminating foreign 
discriminatory government procurement practices against U.S. 
businesses and, if appropriate, legislative recommendations for 
enhancing the usefulness of title VII or any other measures to 
eliminate or respond to foreign discriminatory foreign 
procurement practices.

History of actions under title VII

    In its first report on April 27, 1990, the U.S. Trade 
Representative determined that no country met the statutory 
criteria under title VII. Seven procurement markets of 
particular significance to U.S. suppliers were identified for 
close review over the following year before the 1991 report: 
the European Community (EC), the Federal Republic of Germany, 
France, Italy, Greece, Japan, and Australia.
    In its second annual report on April 26, 1991, the USTR 
identified Norway as meeting the statutory requirements for 
identification as a country in violation of its obligations 
under the GATT Government Procurement Agreement when it awarded 
a sole source contract for an electronic toll booth collection 
system for the city of Trondheim. The report also announced 
that while some progress was made with the EC on non-Code-
covered government procurement in the telecommunications 
equipment and heavy electrical equipment sectors, an early 
review would be conducted of the practices of the EC, Germany, 
France, and Italy in these areas in January 1992 if U.S. 
concerns had not been addressed. Procurement practices of 
Greece, Australia, and Japan were also identified for further 
monitoring.
    In its February 21, 1992 report on the ``early review,'' 
the USTR found that the EC met the requirements for 
identification under title VII with respect to discriminatory 
procurement practices of government-owned telecommunications 
and electrical utilities in certain of its member states. 
Specifically, the report cited the EC's September 1990 
``Utilities Directive,'' scheduled to go into effect by January 
1, 1993, establishing procurement rules for all EC 
telecommunications and heavy electrical utilities requiring 
them to favor EC goods and services over those of the United 
States and other foreign countries, subject to waiver if a 
negotiated market access agreement, such as a new GATT 
Government Procurement Code, were reached with other countries. 
The report stated the President's intention to implement 
appropriate sanctions by January 1993 if ongoing negotiations 
with the EC were not successful in resolving U.S. concerns, 
subject to EC implementation of the discriminatory provisions 
of its Utilities Directive. On April 22, at the conclusion of 
the consultation period provided under title VII, the President 
reaffirmed the identification of the EC, but announced that the 
statutory sanctions would be modified.
    The third annual report on April 29, 1993 continued the 
identification of Norway for the same practice and stated that 
dispute settlement proceedings were expected to conclude in the 
near future. The report also reaffirmed the President's 
intention with respect to the EC and cited certain procurement 
markets in Australia, Japan, and China for further monitoring.
    The fourth annual report on April 30, 1993, identified 
Japan for discrimination in procurement of construction, 
architectural and engineering services. The report continued 
the identification of the EC pending EC Council of Ministers 
approval of an agreement on heavy electrical equipment and 
because the EC did not agree to waive the Utilities Directive 
for telecommunications equipment. Since no agreement had been 
reached on telecommunications discrimination, the United States 
would proceed to impose title VII sanctions. Actions of other 
countries which have agreements with the EC that may require 
implementation of the discriminatory provisions of the EC 
Utilities Directive would also be monitored. Procurement 
practices falling short of statutory requirements for 
identification were noted of continuing concern in Australia, 
China, and Japan. On May 28, 1993, the United States imposed 
sanctions. Effective March 10, 1994, USTR terminated those 
sanctions with respect to the Federal Republic of Germany on 
the basis of assurances that it would not apply the 
discriminatory provisions of the Utilities Directive to 
procurement of U.S. goods by its telecommunications utilities.
    On January 19, 1994, USTR announced the termination of 
sanctions, scheduled to go into effect on January 20, on the 
basis of an announcement by Japan of an action plan to reform 
its public sector construction market.
    On April 30, 1994, USTR annunced that sanctions imposed 
against the European Union (EU) on May 28, 1993 for 
discrimination in the telecommunications sector would remain in 
force since the United States and EU could not reach agreement 
as part of the overall U.S.-EU agreement reached on April 13 
under the GATT Government Procurement Code.
    As a result of some progress towards resuming negotiations 
on telecommunications and medical technology government 
procurement, Japan was not identified in the fifth annual 
report, subject to review within 60 days on the basis of 
Japanese actions in the interim. The report also described 
concerns with procurement practices of Australia, China, and 
Brazil, and in the Japanese supercomputer and computer sectors.
    On June 30, 1994, the USTR announced the postponement until 
not later than July 31 of the decision on whether to identify 
Japan for its discriminatory procurement practices in the 
telecommunications and medical technology sectors because of 
intensive negotiations underway on these priority sectors 
identified under the July 1993 U.S.-Japan Framework Agreement. 
On July 31, the USTR announced the identification of Japan and 
commencement of the title VII 60-day consultation and 
negotiation period as a result of Japan's failure to address 
sufficiently discrimination in the two sectors. On October 4, 
1994, the USTR determined that sanctions scheduled to go into 
effect on Japanese goods and services should be terminated as 
the result of an agreement between the United States and Japan.
    On April 29, 1995, the USTR announced no new 
identifications with respect to title VII but highlighted 
several areas as deserving special attention. First, the USTR 
pointed to the issue of corruption in foreign procurement and 
lack of transparency in procurement procedures. Second, the 
USTR intends to monitor German implementation of the 1993 U.S.-
EU Memorandum of Understanding (MOU) on Government Procurement. 
Third, the United States will monitor Japanese compliance with 
the agreements on telecommunications and medical technology to 
assure tangible progress. Moreover, the USTR announced that the 
report will include information on the procurement practices of 
Australia, Brazil, and China, in addition to Japanese 
procurement practices in the supercomputers and computers 
sectors. Finally, the USTR noted that the sanctions first 
applied in 1993 against the EU for discrimination in the 
telecommunications sector continue and are being extended to 
the three new member states--Austria, Finland, and Sweden.
    On April 30, 1996, the USTR identified Germany for 
discrimination in the heavy electrical equipment sector and its 
failure to adequately implement its obligations under the U.S.-
EU MOU on Government Procurement. Effective January 1, 1996, 
the U.S.-EU commitments under the 1993 MOU were incorporated 
into the World Trade Organization Government Procurement 
Agreement (WTO GPA) and the MOU expired. The Administration 
expressed concern that the inadequacies of Germany's 
implementation of the MOU might carry over into its 
implementation of the WTO GPA. At the end of a 90-day 
consultation period, the USTR announced on October 1, 1996, 
that Germany had agreed to take steps that would effectively 
ensure open competition in the German heavy electrical 
equipment market. Title VII action was not terminated but the 
imposition of sanctions was further delayed pending passage of 
a satisfactory legislative reform package expected within one 
year.
    USTR also noted in the 1996 report that the Administration 
received no comments on specific cases or practices of bribery 
and corruption for the second year since amendments under the 
1994 Uruguay Round Agreement Act added bribery and corruption 
as a category for identification. Noting that many U.S. firms 
do not come forward publicly with cases of bribery and 
corruption influencing contract awards for fear of commercial 
backlash in future contracts, the Administration stated its 
intention to continue working toward the establishment of 
multilateral mechanisms for eliminating bribery and corruption 
in government procurement.\64\ Finally, the report describes 
the Administration's concerns with the procurement practices of 
Australia, Brazil and China, as well as its concern with 
Japan's procurement practices in the areas of public works 
building, supercomputers and computers.
---------------------------------------------------------------------------
    \64\ On May 1, 1998, President Clinton transmitted to Congress the 
Convention on Combating Bribery of Foreign Public Officials in 
International Business Transactions, adopted on November 21, 1997, 
under the auspices of the Organization for Economic Cooperation and 
Development. The Senate ratified the Convention on July 31, 1998.
---------------------------------------------------------------------------
    On March 31, 1999, President Clinton issued Executive Order 
13116, which reinstituted the procedures of Title VII after 
their lapse on April 30, 1996. On May 12, 1999, USTR issued its 
Title VII report, determining not to identify any new countries 
under Title VII because the practices of concern were either 
being addressed under another trade dispute mechanism, did not 
meet the criteria for identification, or were already under 
scrutiny as a result of previous identifications. The 
Administration also noted that the United States would move 
forward with WTO dispute settlement proceedings to challenge 
Korea's government procurement practices in the construction of 
Inchon International Airport. Two Title VII determinations 
remained outstanding from prior reviews: the 1992 
identification of the EU for discriminatory procurement 
practices of government-owned telecommunications entities in 
certain member states; and 1996 identification of Germany for 
discrimination in the heavy electrical sector.\65\
---------------------------------------------------------------------------
    \65\ 64 FR 25525 (May 12, 1999).
---------------------------------------------------------------------------
    On May 8, 2000, USTR issued its annual report, determining 
again that no new practices met the criteria for Title VII 
identification. USTR noted, however, that as in previous years, 
there remain a number of foreign government procurement 
practices of concern which the Administration is pursuing in 
bilateral and multilateral fora, including WTO dispute 
settlement when appropriate, or that require continued 
monitoring and study. USTR also determined to terminate the 
1996 identification of Germany for discrimination in the heavy 
electrical sector, based on Germany's implementation of new 
legislation that appears to effectively address U.S. concerns. 
However, USTR's identification of the EU for discriminatory 
procurement practices of government-owned telecommunications 
entities in certain member states remains outstanding.\66\
---------------------------------------------------------------------------
    \66\ 65 FR 26652 (May 8, 2000).


              Chapter 4: LAWS REGULATING EXPORT ACTIVITIES

                            Export Controls

                               Background

    Through statute, Congress has authorized the President to 
control the export of various commodities. The three most 
significant programs for controlling different types of exports 
deal with nuclear materials and technology, defense articles 
and services, and non-military dual-use goods and technology. 
Under each program, licenses of various types are required 
before an export can be undertaken. The Nuclear Regulatory 
Commission is responsible for the licensing of nuclear 
materials and technology under the Atomic Energy Act. The 
Department of State is responsible for the licensing of exports 
of defense articles and services and maintains the Munitions 
Control List under the Arms Export Control Act.
    Export licensing requirements for most commercial goods and 
technical data are authorized by the Export Administration Act 
under the jurisdiction of the Bureau of Export Administration 
in the Department of Commerce. The three basic purposes of 
export controls are to protect the national security, to 
further U.S. foreign policy interests, and to protect 
commodities in short supply. The Secretary of Defense is 
authorized to review certain applications for national security 
purposes while the Secretary of State reviews specified license 
applications for foreign policy purposes.
    The export of goods or technical data subject to the 
commodity control list (CCL) must be authorized by licenses 
(either individual validated licenses or bulk licenses 
authorizing multiple shipments) which are granted on the basis 
of such factors as intended end-use and the probability and 
likely effect of diversion to military use. Exports and 
reexports from a foreign country of U.S.-origin commodities and 
technical data or of foreign products containing U.S.-origin 
components or technology are also regulated. There are seven 
countries for which shipment of almost all commodities requires 
a license for export: Iran, Iraq, Libya, Serbia, Sudan, North 
Korea, and Cuba.
    The foreign policy export control authority was used by 
President Carter to embargo the export of grain to the Soviet 
Union after the 1979 Soviet invasion of Afghanistan. President 
Reagan used it again in 1981 until late 1983, following the 
imposition of martial law in Poland, to embargo sales by U.S. 
firms and their foreign subsidiaries of oil and gas 
transmission and refining commodities and technology for use by 
the Soviet Union on its natural gas pipeline to Western Europe. 
Crime control and detection instruments and equipment are 
subject to control for foreign policy reasons to countries 
which may engage in persistent gross violations of human 
rights. Certain other goods and technology are controlled to 
five countries (Libya, Iran, Syria, South Yemen, and Cuba) due 
to their repeated support of international terrorism.
    Sanctions against international terrorism were enacted as 
amendments to the Export Administration Act of 1979 under the 
Anti-Terrorism and Arms Export Amendments Act of 1989 \1\ and 
the National Defense Authorization Act for Fiscal Year 1991.\2\
---------------------------------------------------------------------------
    \1\ Public Law 101-222, section 4, approved December 12, 1989.
    \2\ Public Law 101-510, section 1702, approved November 5, 1990.
---------------------------------------------------------------------------
    The short supply control authority was used to help control 
raw materials prices during the Korean conflict. In 1973 
President Nixon prohibited soybean exports as a response to 
rapidly increasing prices. The export of crude oil carried on 
the Trans-Alaska Pipeline is prohibited. Exports of crude oil 
and refined and unprocessed western red cedar harvested from 
federal or state lands are subject to validated licensing 
requirements.
    The U.S. government has employed export controls 
continuously since 1940. The first controls were imposed to 
avoid or mitigate the scarcity of various critical commodities 
during World War II and to assure their equitable distribution 
within the U.S. economy and to U.S. allies. Export controls 
were expected to terminate after shortages created by World War 
II were substantially eliminated. However, the cold war led to 
enactment of the Export Control Act of 1949, designed to 
control all U.S. exports to Communist countries.
    The Export Control Act of 1949 provided for the control of 
items in short supply, for controls to further U.S. foreign 
policy goals, and for the examination of exports to Communist 
countries which might have military application. The 1949 Act, 
amended and extended as appropriate, remained in effect for 20 
years. The 1949 Act was then replaced by the Export 
Administration Act of 1969, which was in turn replaced by the 
Export Administration Act of 1979.
    The 1969 Act maintained the basic export control system set 
up by the Export Control Act, but called for a removal of 
controls on goods and technologies that were freely available 
from foreign sources and that were only marginally of military 
value. The 1969 Act was amended in 1972, 1974, and 1977.
    A significant expansion of controls was brought about in 
1977 when Congress amended the 1969 Act to authorize the 
control of goods and technology exported by any person subject 
to the jurisdiction of the United States, thus permitting the 
Department of Commerce to exercise control over foreign-origin 
goods and technical data reexported by U.S.-owned or U.S.-
controlled companies abroad. Anti-boycott policies (originally 
established by Congress in 1965) were also substantially 
strengthened in 1977.

                   Export Administration Act of 1979

    The Export Administration Act of 1979 \3\ as reauthorized 
and amended in 1985 and 1988 replaced the 1969 Act as amended, 
which expired on September 30, 1979. The 1979 Act provides the 
broad and primary authority for controlling the export from the 
United States to potential adversary nations of civilian goods 
and technology which could contribute significantly to the 
military capability of controlled countries (consisting of 
Communist countries, as defined in section 620(f) of the 
Foreign Assistance Act of 1961) if diverted to military 
application (national security controls under section 5). Like 
the previous law, the 1979 Act also authorized the President to 
impose export controls for foreign policy reasons or to fulfill 
international obligations (foreign policy controls under 
section 6) and to protect the domestic economy from an 
excessive drain of scarce materials and to reduce the 
inflationary impact of foreign demand (short supply controls 
under section 7). The Act also continues the 1977 anti-boycott 
program (section 8) which prohibits U.S. persons from taking 
action with the intent to comply with, further, or support any 
foreign country boycott against any country friendly to the 
United States (primarily Arab states against Israel).
---------------------------------------------------------------------------
    \3\ Public Law 96-72, as amended by P.L. 96-533, P.L. 97-145, P.L. 
98-108, P.L. 98-207, P.L. 98-222, P.L. 99-64, P.L. 99-399, P.L. 99-441, 
P.L. 99-633, P.L. 100-180, P.L. 100-418, P.L. 100-449, P.L. 101-222, 
and P.L. 101-510, 50 U.S.C. App. 2401.
---------------------------------------------------------------------------
    In its 1979 review of the Export Administration Act of 
1969, the Congress made substantial changes in the statute. 
Separate and distinct procedures and criteria were established 
for imposing national security and foreign policy controls. 
Precise time deadlines were set for the processing of export 
license applications. Development of a ``militarily critical 
technologies list'' (MCTL) was mandated, both as a means of 
reviewing the adequacy and focus of the existing commodity 
control list of categories of goods and technologies subject to 
Commerce export controls, and as a possible means of arriving 
at a more limited control list containing only the most 
militarily significant technologies. Foreign availability of 
goods controlled by the United States was, for the first time, 
made a factor in decisions to license such items for export.
    The Act also formally authorized U.S. participation in the 
informal multilateral export control body known as COCOM 
(Coordinating Committee on Multilateral Export Controls) in 
which the NATO countries (with the exception of Iceland) and 
Japan also participate. Since 1950, COCOM has attempted to 
coordinate the export control policies of the Western allies 
with respect to Communist countries. Representatives of the 
participating governments meet periodically to set guidelines 
for controls on exports to Communist countries. The 1979 Act 
directed the President to negotiate with other COCOM 
governments in an effort to reach agreement on reducing the 
scope of export controls, holding periodic high-level meetings 
on COCOM policy, publishing the list of items controlled by 
COCOM, and introducing more effective procedures for enforcing 
COCOM export controls.
    The 1979 Act authorized the administration of export 
controls until September 30, 1983. The Act was extended 
temporarily three times during the 98th Congress, through 
October 15, 1983, subsequently through February 28, 1984, and 
finally until March 30, 1984,\4\ while the Congress considered 
proposals for major changes in the law. During the lapses in 
authority in 1983 and after the 1979 Act terminated on March 
30, 1984, and House-Senate differences could not be resolved 
prior to congressional adjournment on October 12, 1985, the 
President administered export controls under the authority of 
the International Emergency Economic Powers Act and Executive 
Order 12470 of March 30, 1984, as an interim method of control 
until new authority could be passed by Congress. The Export 
Administration Amendments Act of 1985 \5\ which reauthorized 
the 1979 Act for 4 years until September 30, 1989, with 
comprehensive amendments, was enacted on July 12, 1985.
---------------------------------------------------------------------------
    \4\ Public Law 98-108, approved October 1, 1983; Public Law 98-207, 
approved December 5, 1983; Public Law 98-222, approved February 29, 
1984.
    \5\ Public Law 99-64.
---------------------------------------------------------------------------

              Export Administration Amendments Act of 1985

    The 1985 Act left intact the basic structure of U.S. 
national security, foreign policy, and short-supply export 
controls. The main goals of the 1985 Act were to improve U.S. 
export competitiveness and to promote national security 
interests through stricter controls and better enforcement.
    Increased U.S. competitiveness was to be achieved by easing 
the total licensing burden on U.S. businesses. Export licensing 
requirements were eliminated in the case of certain relatively 
low-technology items, and the Secretary of Commerce was 
directed to review and revise the commodity control list at 
least once a year. The approval process for license 
applications was to be streamlined as well. The 1985 amendments 
also addressed the issue of foreign availability by specifying 
a process to provide for the review and decontrol of goods 
found to be widely available and unable to be brought under 
control.
    The promotion of national security interests was to be 
achieved by providing stricter controls for the export of 
critical items and strengthening the enforcement of U.S. export 
controls. The 1985 Act required the United States to undertake 
negotiations with COCOM countries to achieve greater 
coordination and compliance with multilateral controls, fewer 
exceptions to the control list, and strengthened and uniform 
enforcement. It created new criminal offenses against illegal 
diversions and added to the broad range of sanctions against 
violators of U.S. export controls.
    The Act also restrained the President's authority to impose 
new foreign policy export controls, particularly to embargo 
agricultural exports. Additional requirements for consultations 
with industry and Congress prior to the imposition of foreign 
policy controls and greater attention to specified criteria, 
including the foreign availability of competing products, are 
to be considered prior to decisons to extend, expand, or impose 
export controls.
    The 1985 Act also imposed limitations on, but did not 
entirely eliminate, the discretion of the President to impose 
foreign policy controls on exports subject to existing 
contracts. The Act prohibits controls on exports of goods or 
technology under existing contracts except where the President 
determines and certifies to the Congress that a breach of the 
peace poses a serious and direct threat to U.S. strategic 
interests and the prohibition or curtailment of such contracts 
would be instrumental in remedying the situation posing the 
direct threat.
    The Act set forth stiffer penalties for violators and 
granted new powers for enforcement to the Department of 
Commerce and the U.S. Customs Service and clarified the 
respective roles of these agencies. Commerce retained the 
primary responsibility for licensing and domestic enforcement 
whereas Customs was given primary responsibility for 
enforcement at all U.S. ports of exit and entry as well as all 
enforcement responsibility overseas. The legislation itself was 
silent on the controversial issue of the role and authority of 
the Department of Defense in reviewing export license 
applications for U.S. shipments to Western nations.
    The Act created a new Under Secretary of Export 
Administration and two Assistant Secretaries in the Department 
of Commerce and a new National Security Council Office in the 
Department of Defense. Congress also directed that an Office of 
Foreign Availability be established in the Department of 
Commerce.

             Omnibus Trade and Competitiveness Act of 1988

    Congressional dissatisfaction with the implementation of 
the Export Administration Amendments Act of 1985 led to the 
introduction of new legislation during both the 99th and 100th 
Congresses. The Omnibus Trade and Competitiveness Act of 1988 
\6\ contained major revisions of the Export Administration Act 
of 1979. Like the 1985 amendments, the 1988 Act emphasized the 
reduction of export disincentives and the strengthening of 
export enforcement. A clarification of the dispute resolution 
process was also a part of the Act. The authorization date for 
the Export Administration Act was extended by 1 year to 
September 30, 1990.
---------------------------------------------------------------------------
    \6\ Public Law 100-418, title II, subtitle D, approved August 23, 
1988.
---------------------------------------------------------------------------
    The 1988 Act provided for the reduction of export 
disincentives through a streamlining of licensing requirements, 
control list reduction, and improved procedures for making 
foreign availability determinations. The 1988 Act also provided 
for the use of distribution licenses for multiple exports to 
the People's Republic of China.
    The 1988 Act provided for stronger enforcement of U.S. and 
multilateral export controls.
    In the case of persons convicted of violations of the 
Export Administration Act of 1979 or the International 
Emergency Economic Powers Act,\7\ the Department of Commerce 
was authorized to bar such persons from applying for or using 
export licenses. Such authority was also extended to parties 
related through affiliation, ownership, control, or position of 
responsibility to any person convicted of violations.
---------------------------------------------------------------------------
    \7\ Public Law 95-223, approved December 28, 1977.
---------------------------------------------------------------------------
    In response to the sale by Toshiba Machine Company of Japan 
and Kongsberg Trading Company of Norway of advanced milling 
machinery to the Soviet Union, the Congress passed the 
Multilateral Export Control Enhancement Amendments Act.\8\ 
Section 2443 of that Act requires the President to impose, for 
a period of 3 years, a ban on U.S. government contracting with 
and procurement from the two cited companies and their parent 
companies. That section also required the President to prohibit 
the importation of all products produced by Toshiba Machine 
Company and Kongsberg Trading Company for a period of 3 years. 
The sanctions required by section 2443 were imposed by 
President Reagan on December 27, 1988 \9\ and remained in 
effect until December 28, 1991.
---------------------------------------------------------------------------
    \8\ Public Law 100-418, sections 2441-2447, approved August 23, 
1988.
    \9\ Executive Order 12661, dated December 27, 1988; ``Implementing 
the Omnibus Trade and Competitiveness Act of 1988 and Related 
International Trade Matters.''
---------------------------------------------------------------------------
    The Export Administration Act of 1979 expired on September 
30, 1990. The 101st Congress passed legislation (H.R. 4653) to 
reauthorize the Act, but the President exercised a pocket-veto 
in November 1990. During the 102d Congress, the House and 
Senate passed bills and produced a conference report 
reauthorizing the Export Administration Act of 1979. The 
conference report failed to be considered before the 102d 
Congress adjourned sine die. Since September 30, 1990, the 
President exercised the authorities provided in the 
International Emergency Economic Powers Act to continue in 
effect the existing system of export controls.
    During the 103d Congress, the Export Administration Act was 
extended twice. On March 27, 1994, Public Law 103-10, the 
Export Administration Fiscal Year 1994 Authorization bill, 
extended the Act through June 30, 1994.\10\ Public Law 103-277 
provided for an additional extension until August 20, 1994 as 
discussions between the Administration and the Congress 
continued on revisions to the Act.\11\ Because the Congress did 
not take final action on a revised Export Administration Act 
before the close of the session, the President once again used 
the International Emergency Economic Powers Act authorities to 
continue the existing export control system. On August 19, 
1994, President Clinton issued an executive order continuing 
the export control regulations provided under the Act.\12\ The 
President announced a continuation of the emergency on August 
15, 1995 (60 Fed. Reg. 42,767) and again on August 14, 1996 (61 
Fed. Reg. 42,527).
---------------------------------------------------------------------------
    \10\ Public Law 103-10, approved March 27, 1994.
    \11\ Public Law 103-277, approved July 5, 1994.
    \12\ Executive Order 12924, dated August 19, 1994; ``Continuation 
of Export Control Regulations.''
---------------------------------------------------------------------------
    The President continued the national emergency on August 
13, 1997 (62 Fed. Reg. 43,629), August 13, 1998 (63 Fed. Reg. 
44,121), August 10, 1999 (64 Fed. Reg. 44,101), and August 3, 
2000 (65 Fed. Reg. 48,347). On November 13, the President 
signed into law an extension of the Export Administration Act 
of 1979 until August 20, 2001.\13\
---------------------------------------------------------------------------
    \13\ Public Law 106-508.
---------------------------------------------------------------------------

                 Export Promotion of Goods and Services


                     Export Enhancement Act of 1988

    The Export Enhancement Act, enacted under title XXIII of 
the Omnibus Trade and Competitiveness Act of 1988,\14\ includes 
provisions which establish in statute the United States and 
Foreign Commercial Service in the International Trade 
Administration of the Department of Commerce. The basic purpose 
of the Service is to promote the export of U.S. goods and 
services, particularly by small- and medium-sized businesses, 
and to promote and protect U.S. business interests abroad. 
Section 2306 requires the Service to make a special effort to 
encourage U.S. exports of goods and services to Japan, South 
Korea, and Taiwan.
---------------------------------------------------------------------------
    \14\ Public Law 100-418, approved August 23, 1988, 15 U.S.C. 4721 
et seq.
---------------------------------------------------------------------------
    Section 2303 authorizes the Secretary of Commerce to 
establish a market development cooperator program in the 
International Trade Administration to develop, maintain, and 
expand foreign markets for U.S. non-agricultural goods and 
services. The program is implemented through contracts with 
non-profit industry organizations, trade associations, state 
departments of trade and their regional associations, and 
private industry firms or groups of firms (all referred to as 
``cooperators''). The Secretary was also directed to establish, 
as part of the program, a partnership program with cooperators 
under which cooperators may detail individuals to the Service 
for 1 to 2 years. This program is modeled after a similar 
program established by the Foreign Agricultural Service in the 
late 1950's to develop overseas commercial market opportunities 
for American agricultural exports.
    In order to facilitate exporting by U.S. businesses, 
section 2304 requires the Secretary to provide assistance for 
trade shows in the United States which bring together 
representatives of U.S. businesses seeking to export goods or 
services, particularly participation by small businesses, and 
representatives of foreign companies or governments seeking to 
buy such U.S. goods or services. Sections 2312 and 2313 added 
to the Act made by title II of the Export Enhancement Act of 
1992 \15\ expanded export promotion efforts. Section 2312 
establishes in statute the Trade Promotion Coordinating 
Committee (TPCC) and directs it to coordinate the export 
promotion and export financing activities of the federal 
government and to develop a governmentwide strategic plan for 
carrying out federal export promotion and financing programs, 
including establishment of priorities. The Chair of the TPCC 
must submit an annual report to the Congress on the strategic 
plan developed. Section 2313 states the U.S. policy to foster 
the export of U.S. environmental technologies, goods, and 
services, and establishes the Environmental Trade Promotion 
Working Group within the TPCC for this purpose.
---------------------------------------------------------------------------
    \15\ Public Law 102-429, approved October 21, 1992.
---------------------------------------------------------------------------
    The Jobs Through Export Expansion Act of 1994 amended 
section 2313 to provide for the establishment of an 
environmental technologies trade advisory committee, including 
representatives of the private sector and the states, to advise 
the TPCC working group. The amendment also requires the working 
group to develop export plans for five priority countries and 
the placement of environmental technology specialists in each 
of the priority countries.\16\
---------------------------------------------------------------------------
    \16\ Public Law 103-392, approved October 22, 1994, 15 U.S.C. 4701 
note.
---------------------------------------------------------------------------

                  Fair Trade in Auto Parts Act of 1988

    The Fair Trade in Auto Parts Act of 1988, sections 2121-
2125 of the Omnibus Trade and Competitiveness Act of 1988,\17\ 
required the Secretary of Commerce to establish an initiative 
to increase the sale of U.S.-made auto parts and accessories to 
Japanese markets, including to U.S. subsidiaries of Japanese 
firms. The Secretary also was required to establish a Special 
Advisory Committee to advise and assist the Secretary in 
carrying out the initiative to increase U.S. auto parts sales 
in Japanese markets. The authorities granted under sections 
2121-2125 expired on December 31, 1998.
---------------------------------------------------------------------------
    \17\ Public Law 100-418, approved August 23, 1988, 15 U.S.C. 4701.
---------------------------------------------------------------------------
    In response to low sales of U.S. auto parts and accessories 
to Japanese auto firms based both in Japan and in the United 
States, Congress adopted the Fair Trade in Auto Parts Act of 
1988. This action followed negotiations in 1986-87 between the 
U.S. and Japanese governments aimed at improving U.S. access to 
the Japanese auto parts markets. The provision was intended to 
provide for a longer-term effort to increase data collection, 
information exchange, and generally improved U.S. market access 
in the Japanese auto parts sector.\18\ The U.S.-Japan 
Automotive Agreement expired on December 31, 2000.
---------------------------------------------------------------------------
    \18\ Market Oriented Sector Specific Talks on Transportation 
Machinery, initiated on August 26, 1986 and concluded on August 18, 
1987.
---------------------------------------------------------------------------

                Agricultural Export Sales and Promotion

    To help finance sales of U.S. farm commodities abroad, the 
U.S. Department of Agriculture (USDA) administers several sales 
and credit programs. These include the concessional sales 
program under the authority of the Agricultural Trade 
Development and Assistance Act of 1954, as amended, commonly 
known as Public Law 480,\19\ and the commercial programs of the 
Commodity Credit Corporation (CCC).
---------------------------------------------------------------------------
    \19\ Public Law 83-480, approved July 10, 1954, 7 U.S.C. 1701-
1736d.
---------------------------------------------------------------------------

                             Public Law 480

    Public Law 480 was reauthorized through the end of 2002 by 
the Federal Agriculture Improvement and Reform Act of 1996.\20\ 
Title I of Public Law 480 authorizes sales of U.S. agricultural 
commodities to developing countries or private entities for 
dollars on credit terms or for local currencies. Credit is 
provided at concessional interest rates for repayment periods 
up to 30 years. The Secretary of Agriculture may allow a grace 
period of up to 5 years before repayment must begin. Title II 
authorizes donations of U.S. agricultural commodities for 
emergency humanitarian relief and for development projects. 
Title II is implemented primarily through U.S. private 
voluntary organizations or cooperatives and the United Nations 
world food program. Title III authorizes donations to 
governments of least developed countries for direct feeding 
programs, emergency food reserves, and recipient government 
sales which are used to finance economic development 
activities. As a result of reforms made by Public Law 104-127, 
USDA is responsible for administering title I, while the U.S. 
Agency for International Development (USAID) is responsible for 
administering titles II and III.
---------------------------------------------------------------------------
    \20\ Public Law 104-127, approved April 4, 1996.
---------------------------------------------------------------------------

         Export Credit Guarantee and Export Promotion Programs

    USDA, using the resources of the Commodity Credit 
Corporation (CCC), offers both commercial credit and export 
promotion programs designed to maintain and expand overseas 
markets for U.S. farm products.
    In operating two export credit guarantee programs, the CCC 
guarantees U.S. banks against defaults on payments due from 
foreign banks on the agricultural export sales they finance. 
Guarantees are made against political risks such as warfare, 
expropriation, exchange controls, and other foreign government 
actions, and against economic risks such as a foreign bank 
failure or a country's debt repayment problems. The U.S. banks 
deal directly with foreign purchasers to set loan repayment 
terms and interest rates, but must meet certain requirements to 
qualify for CCC guarantees.
    The GSM-102 program guarantees credits for up to 3 years 
for commercial export sales of U.S. agricultural commodities 
from privately owned stocks. The GSM-103 program guarantees 
credits for longer periods of 3 to 10 years. The Federal 
Agriculture Improvement and Reform Act of 1996 (the ``farm 
bill'') authorized the CCC to make available for each fiscal 
year 1996 through 2002, $5.5 billion in credit guarantees. The 
Secretary of Agriculture is given flexibility to allocate these 
funds between short-term (up to 3 years) and intermediate-term 
(3 to 10 years) guarantees. In addition, the farm bill 
authorizes another $1 billion of export credit guarantees or 
direct credits for fiscal years 1996 through 2002 for countries 
that are classified as ``emerging markets.'' Emerging markets 
are countries taking steps toward a market-oriented economy and 
have potential to become viable commercial markets for U.S. 
agricultural exports.\21\
---------------------------------------------------------------------------
    \21\ Public Law 104-127, approved April 4, 1996.
---------------------------------------------------------------------------
    Title III of the Agricultural Trade Act of 1978, as amended 
by the Uruguay Round Trade Agreements Act of 1994 \22\ and the 
1996 farm bill,\23\ authorizes the export enhancement program 
(EEP).
---------------------------------------------------------------------------
    \22\ Public Law 103-465, approved December 8, 1994, 19 U.S.C. 3501 
note.
    \23\ Public Law 104-127, approved April 4, 1996.
---------------------------------------------------------------------------
    The EEP was first established by the Congress in the Food 
Security Act of 1985 \24\ (the 1985 farm bill) to counter 
foreign exporters' use of subsidies as a means of increasing 
their agricultural exports. The Uruguay Round Agreements Act 
revised the definition of the EEP ``to encourage the commercial 
sale of U.S. agricultural commodities in world markets at 
competitive prices.'' The Uruguay Round Agreements Act also 
provided that EEP would be ``carried out in a market sensitive 
manner'' and ``not limited to responses to unfair trade 
practices.'' \25\ Under EEP, the CCC makes cash bonuses 
available to private U.S. exporters on a bid basis to 
compensate them for making competitively-priced sales in 
overseas markets. The 1996 farm bill reauthorized EEP for 
fiscal years 1996 through 2002 and set annual maximum spending 
levels: $350 million in fiscal year 1996; $250 million in 
fiscal year 1997; $500 million in fiscal year 1998; $550 
million in fiscal year 1999; $579 million in fiscal year 2000; 
and $478 million annually in fiscal years 2001 and 2002.
---------------------------------------------------------------------------
    \24\ Public Law 99-198, approved December 23, 1985.
    \25\ Public Law 103-465, approved December 8, 1994, 7 U.S.C. 5601 
note.
---------------------------------------------------------------------------
    The CCC also administers the market access program (MAP) in 
order to ``encourage the development, maintenance, and 
expansion of commercial export markets for agricultural 
commodities through cost-share assistance to eligible trade 
organizations that implement a foreign market development 
program.'' The MAP was established under the 1996 farm bill as 
the successor to the market promotion program (MPP) authorized 
by the 1990 farm bill. MPP had replaced the targeted export 
assistance program (TEA) of the Food Security Act of 1985. 
Unlike the TEA, priority is no longer accorded to exports which 
encounter unfair trade practices or barriers in foreign 
markets.


   Chapter 5: AUTHORITIES RELATING TO POLITICAL OR ECONOMIC SECURITY

              International Emergency Economic Powers Act

    In 1977, Congress passed the International Emergency 
Economic Powers Act (IEEPA).\1\ The Act grants the President 
authority to regulate a comprehensive range of financial and 
commercial transactions in which foreign parties are involved 
but allows the President to exercise this authority only in 
order ``to deal with an unusual and extraordinary threat, which 
has its source in whole or in part outside the United States, 
to the national security, foreign policy, or economy of the 
United States, if the President declares a national emergency . 
. . with respect to such threat.''
---------------------------------------------------------------------------
    \1\ Public Law 95-223, title II, approved December 28, 1977, 91 
Stat. 1626, 50 U.S.C. 1701-1706.
---------------------------------------------------------------------------
Background

    Public Law 95-223, of which IEEPA constitutes title II, 
redefined the President's authorities to regulate international 
economic transactions in times of national emergency as well as 
war, until then provided by section 5(b) of the Trading With 
the Enemy Act (TWEA) (50 App. U.S.C. 5(b)), by eliminating 
TWEA's applicability to national emergencies \2\ and instead 
providing such authorities in a separate statute of somewhat 
narrower scope and subject to congressional review.
---------------------------------------------------------------------------
    \2\ Title I of Public Law 95-223 also provides for the continuation 
in force, through annual presidential extensions, of certain measures 
implemented on the basis of national emergencies declared under the 
TWEA. For further detail, see section on the Trading With the Enemy 
Act.
---------------------------------------------------------------------------
    The authorities granted to the President under IEEPA 
broadly parallel those contained in section 5(b) of the TWEA 
but are somewhat fewer and more circumscribed. While under the 
TWEA the existence of any declared national emergency, whether 
or not connected with the circumstances requiring emergency 
action, was used as the basis for such action, the IEEPA allows 
emergency measures against an external threat only if a 
national emergency has been declared with respect to the same 
threat. Furthermore, certain authorities contained in the TWEA 
and still applicable in times of war are not included in the 
IEEPA, such as the powers to vest foreign property, to regulate 
purely domestic transactions, to regulate gold or bullion, or 
to seize records. Nevertheless, the President's authorities 
under the IEEPA still remain extensive. The President may ``by 
means of instructions, licenses, or otherwise . . . 
investigate, regulate, prevent, or prohibit'' virtually any 
foreign economic transaction, from import or export of goods 
and currency to transfer of exchange or credit. The only 
international transactions exempted from this authority are 
personal communications not involving a transfer of anything of 
value, charitable donations of necessities of life to relieve 
human suffering (except in certain circumstances), transactions 
in publications or various other informational materials not 
otherwise controlled by export control law or prohibited by 
espionage law, or personal transactions ordinarily incident to 
travel.
    IEEPA requires the President to consult with Congress, 
whenever possible before declaring a national emergency, and 
while it remains in force. Once a national emergency goes into 
effect, the President must submit to Congress a detailed report 
explaining and justifying his actions and listing the countries 
against which such actions are to be taken, and why.

Application

    Since its enactment, the authority conferred by the IEEPA 
has been exercised on several occasions and for different 
purposes: to impose a variety of economic sanctions on foreign 
countries and to continue in force the authority of the Export 
Administration Act during several periods when statutory 
authority has lapsed.
    In response to the seizure of the American Embassy and 
hostages in Teheran, President Carter, using the IEEPA 
authority, on November 14, 1979, declared a national emergency 
and ordered the blocking of all property of the government of 
Iran and of the Central Bank of Iran within the jurisdiction of 
the United States.\3\ The measure and its later amendments were 
implemented through Iranian Assets Control Regulations (31 CFR 
535). Sanctions against Iran were broadened on April 7, 
1980,\4\ and April 17, 1980,\5\ to constitute eventually an 
embargo on all commercial, financial, and transportation 
transactions with Iran, with minimal exceptions. The trade 
embargo was revoked by President Carter on January 19, 1981, 
after the release of the Teheran hostages, but the national 
emergency has remained in effect and has been extended every 
year since.\6\
---------------------------------------------------------------------------
    \3\ Executive Order 12170, November 14, 1979, 44 Fed. Reg. 65,729.
    \4\ Executive Order 12205, April 7, 1980, 45 Fed. Reg. 24,099.
    \5\ Executive Order 12211, April 27, 1980, 45 Fed. Reg. 26,685.
    \6\ Following Iranian attacks on U.S. flag ships in the Iran-Iraq 
war, an embargo was reimposed on October 29, 1987 (Executive Order 
12613, 52 Fed. Reg. 41,940), on imports of goods and services from Iran 
under the authority of section 505 of the International Security and 
Development Cooperation Act of 1985 (22 U.S.C. 2349aa-9) and 
implemented through Iranian Transactions Regulations (31 CFR part 560). 
The embargo is still in force.
---------------------------------------------------------------------------
    President Clinton invoked his authority under IEEPA and 
other statutes on March 15, 1995 to prohibit the entry of any 
U.S. person or any entity controlled by a U.S. person into a 
contract involving the financing or overall supervision and 
management of the development of the petroleum resources 
located in Iran.\7\ The President imposed additional sanctions 
on May 8, 1995.\8\ The sanctions were than amended in 1997.\9\
---------------------------------------------------------------------------
    \7\ Executive Order 12957, March 15, 1995, 60 Fed. Reg. 14,615.
    \8\ Executive Order 12959, May 6, 1995, 60 Fed. Reg. 24,757. See 
also discussion on the Iran and Libya Sanctions Act of 1996.
    \9\ Executive Order 13059 (62 Fed. Reg. 44,531); 34 Weekly Comp. 
Pres. doc. 2324 (Nov. 16, 1998); 31 C.F.R. Part 560.
---------------------------------------------------------------------------
    On May 1, 1985, President Reagan, under his IEEPA powers, 
declared a national emergency because of the ``Nicaraguan 
government's aggressive activities in Central America'' and 
prohibited all imports of Nicaraguan goods and services, all 
exports to Nicaragua (other than those destined for the 
organized democratic resistance) and transactions related 
thereto, and all activities of Nicaraguan ships and aircraft at 
U.S. sea- and airports.\10\ The declaration of emergency and 
the imposed sanctions were terminated on March 13, 1990.\11\
---------------------------------------------------------------------------
    \10\ Executive Order 12513, May 1, 1985, 50 Fed. Reg. 18,629. The 
embargo is implemented by Nicaraguan Trade Control Regulations (31 CFR 
part 540).
    \11\ Executive Order 12707, March 13, 1990, 55 Fed. Reg. 9,707.
---------------------------------------------------------------------------
    IEEPA was also used by President Reagan to declare a 
national emergency with respect to South Africa because of its 
``policy and practice of apartheid'' and impose, using also 
several other authorities, effective on October 11, 1985, an 
embargo on certain trade (including specifically the 
importation of krugerrands) and financial transactions with the 
government of South Africa.\12\ The embargo, implemented 
through South African Transactions Regulations (31 CFR 545), 
was later greatly expanded, and additional economic sanctions 
were imposed by the Comprehensive Anti-Apartheid Act of 
1986,\13\ upon the enactment of which the President allowed the 
declaration of the South African emergency to expire.\14\
---------------------------------------------------------------------------
    \12\ Executive Order 12532, September 9, 1985, 50 Fed. Reg. 36,861; 
Executive Order 12535, October 1, 1985, 50 Fed. Reg. 40,325.
    \13\ Public Law 99-440, approved October 2, 1986, 100 Stat. 1086, 
22 U.S.C. 5001 et seq.
    \14\ Weekly Compilation of Presidential Documents, v. 23, no. 36, 
September 14, 1987, p. 997.
---------------------------------------------------------------------------
    Under the South African Democratic Transition Support Act 
of 1993, Congress repealed certain sections of the 
Comprehensive Anti-Apartheid Act and provided for the total 
repeal of the Act upon certification by the President that an 
interim government, elected on a non-racial basis through free 
and fair elections, had taken office in South Africa.\15\ 
President Clinton sent such certification to Congress on June 
8, 1994.\16\
---------------------------------------------------------------------------
    \15\ Public Law 103-149, approved November 23, 1993, 22 U.S.C. 5001 
note.
    \16\ Message to the Congress on Elections in South Africa, 30 
Weekly Compilation of Documents 1258 (June 8, 1994).
---------------------------------------------------------------------------
    President Reagan similarly used the IEEPA authority, among 
several others, to impose economic sanctions on Libya because 
of Libyan-supported terrorist attacks on the Rome and Vienna 
airports. On January 7, 1986, he declared a national emergency 
and prohibited all trade (with minimal exceptions) and 
transportation transactions with Libya, extension of credit to 
the Libyan government, and personal travel to or within 
Libya.\17\ On the following day, he ordered the blocking of all 
property and interests of the Libyan government and its 
instrumentalities in the United States.\18\ These measures are 
implemented by Libyan Sanctions Regulations (31 CFR 550). The 
emergency with respect to Libya and the sanctions were extended 
annually.\19\
---------------------------------------------------------------------------
    \17\ Executive Order 12543, January 7, 1986, 51 Fed. Reg. 875.
    \18\ Executive Order 12544, January 8, 1986, 51 Fed. Reg. 1,235.
    \19\ 35 Weekly Comp. Pres. Doc. 1415 (July 19, 1999). See also the 
discussion concerning the Iran and Libya Sanctions Act of 1996.
---------------------------------------------------------------------------
    Again, on April 8, 1988, under the IEEPA authority, 
President Reagan declared a national emergency with respect to 
Panama and ordered the imposition of economic sanctions on that 
country \20\ because of ``the actions of Manuel Antonio Noriega 
and Manuel Solis Palma, to challenge the duly constituted 
authorities of the government of Panama.'' The order involved 
the blocking of all property and interests of the government of 
Panama, including all its agencies and instrumentalities and 
controlled entities, that are or may come within the United 
States. The blocking applies specifically to payments of 
transfers of any kind or financial transactions for the benefit 
of the Noriega-Solis regime from the United States or by any 
physical or legal U.S. person located in Panama. The order, 
implemented through Panamanian Transactions Regulations (31 CFR 
565), was revoked on April 5, 1990.\21\
---------------------------------------------------------------------------
    \20\ Executive Order 12635, April 8, 1988, 53 Fed. Reg. 12,134.
    \21\ Executive Order 12710, April 5, 1990, 55 Fed. Reg. 13,099.
---------------------------------------------------------------------------
    On August 2, 1990, in response to the Iraqi invasion of 
Kuwait, President Bush, under section 204(b) of the IEEPA, 
declared a national emergency, blocked Iraqi and Kuwaiti 
government property and prohibited all transactions with Iraq, 
except exports and imports of informational materials and 
donations to relieve human suffering.\22\ Additional 
restrictions, including a prohibition of all transactions with 
Kuwait, were imposed a week later. Regulations implementing the 
restrictions were promulgated with respect to Kuwait on 
November 30, 1990, and with respect to Iraq on January 18, 
1991.\23\ While Kuwaiti sanctions were revoked after the 
liberation of Kuwait,\24\ the Iraqi national emergency and 
Iraqi sanctions remain in force.
---------------------------------------------------------------------------
    \22\ Executive Order 12722 and 12723, August 2, 1990, 55 Fed. Reg. 
31,803 and 31,805.
    \23\ Kuwaiti Assets Control Regulations, 55 Fed. Reg. 49,856, 31 
CFR 570; Iraqi Sanctions Regulations, 56 Fed. Reg. 2,112, 31 CFR 575.
    \24\ Executive Order 12771, July 25, 1991, 56 Fed. Reg. 35,993.
---------------------------------------------------------------------------
    President Bush also used his authority under the IEEPA and 
other acts to declare a national emergency on November 16, 1990 
with respect to the threat posed to the national security and 
foreign policy of the United States by the proliferation of 
chemical and biological weapons.\25\ Under this declaration, 
the President ordered that trade sanctions be imposed against 
foreign persons determined by the Secretary of State as having 
used or made substantial preparations to use chemical or 
biological weapons in violation of international law. This 
order was implemented under the Export Administration 
Regulations on Proliferation Controls.\26\ The national 
emergency was expanded by President Clinton to include the 
proliferation of nuclear weapons on November 14, 1994 \27\ and 
on July 28, 1998.\28\
---------------------------------------------------------------------------
    \25\ Executive Order 12735, November 16, 1990, 55 Fed. Reg. 48,587.
    \26\ 15 CFR part 778.
    \27\ Executive Order 12938, November 14, 1994, 59 Fed. Reg. 59,099.
    \28\ Executive Order 13094 (63 Fed. Reg. 40,803); 31 C.F.R. Part 
539.
---------------------------------------------------------------------------
    President Bush used his authority under IEEPA and other 
acts on October 4, 1991 to declare a national emergency with 
respect to the illegal seizure of power from the democratically 
elected government of Haiti.\29\ Under this declaration, all 
property and interests of the de facto regime in Haiti were 
blocked. The order was expanded by the President on October 28, 
1991 to prohibit trade and other transactions with Haiti.\30\ 
These measures were subsequently implemented by the Haitian 
Transactions Regulations.\31\ After the signing of the 
Governors Island Agreement on July 3, 1993, U.S. trade 
restrictions against Haiti were suspended, and new financial 
and other transactions with the government of Haiti were 
authorized consistent with U.N. Security Council Resolution 
861. The rule, however, did not unblock property of the 
government of Haiti that was blocked before August 30, 1993. 
Due to the failure of the de facto regime in Haiti to fulfill 
its obligations under the Governors Island Agreement, the 
restrictions against trade, as well as financial and other 
transactions, with Haiti were reimposed on October 19, 
1993.\32\ In response to the restoration of the democratically 
elected government of Haiti, President Clinton terminated the 
national emergency on October 14, 1994.\33\
---------------------------------------------------------------------------
    \29\ Executive Order 12775, October 4, 1991, 56 Fed. Reg. 50,641.
    \30\ Executive Order 12779, October 28, 1991, 56 Fed. Reg. 55,975.
    \31\ 31 CFR part 580.
    \32\ Presidential Notice of September 30, 1993 (58 Fed. Reg. 
51,563); Haitian Transactions Regulations, 31 CFR part 580.
    \33\ Executive Order 12932, October 14, 1994, 59 Fed. Reg. 52,403.
---------------------------------------------------------------------------
    In response to the involvement of Serbia and Montenegro 
with groups attempting to seize territory in Croatia and 
Bosnia-Hercegovina, President Bush declared a national 
emergency under the IEEPA and other authorities on May 30, 
1992, blocking all property and interests of the governments of 
Serbia and Montenegro in the United States.\34\ Additional 
orders were later issued by the President to prohibit trade and 
other transactions with Serbia and Montenegro.\35\ The orders 
were implemented in the Federal Republic of Yugoslavia (Serbia 
and Montenegro) Sanctions Regulations (31 CFR 585). The 
emergency with respect to Serbia and Montenegro was most 
recently extended by the President on May 25, 1994, and was 
expended in scope on October 25, 1994 to include the Bosnian 
Serb military and the areas of the Republic of Bosnia and 
Herzegovina under the control of those forces.\36\ In response 
to this situation and the crisis in Kosovo, President Clinton 
issued additional Executive orders, most recently on January 
17, 2001.\37\
---------------------------------------------------------------------------
    \34\ Executive Order 12808, May 30, 1992, 57 Fed. Reg. 23,299.
    \35\ Executive Order 12810, June 5, 1992, 57 Fed. Reg. 24,347; 
Executive Order 12831, January 15, 1993, 58 Fed. Reg. 5,253; Executive 
Order 13121.
    \36\ Presidential Notice of May 25, 1994 (59 Fed. Reg. 27,429); 
Executive Order 12934, October 25, 1994, 59 Fed. Reg. 54,119.
    \37\ Executive Order 13192 (66 Fed. Reg. 7379).
---------------------------------------------------------------------------
    On September 26, 1993, President Clinton declared a 
national emergency under the IEEPA and other acts with respect 
to the actions and policies of the National Union for the Total 
Independence of Angola (UNITA).\38\ As a result of this 
emergency, the President's order prohibited the sale or supply 
of arms and related material or petroleum and petroleum 
products to Angola, except through designated points of entry. 
These restrictions, implemented by the UNITA (Angola) Sanctions 
Regulations, were most recently extended by the President on 
August 18, 1998.\39\
---------------------------------------------------------------------------
    \38\ Executive Order 12865, September 26, 1993, 58 Fed. Reg. 
51,005.
    \39\ UNITA (Angola) Sanctions Regulations, 58 Fed. Reg. 64,904, 31 
CFR part 590; Executive Order 13098 (63 Fed. Reg. 44,771).
---------------------------------------------------------------------------
    President Clinton also invoked his authority under the 
IEEPA and other acts to declare a national emergency on January 
23, 1995 with respect to the disruption of the Middle East 
peace process by foreign terrorists.\40\ In this declaration, 
the President prohibited all transactions with persons 
designated by the Secretary of State, in coordination with the 
Secretary of the Treasury and the Attorney General, as having 
committed or posing a significant risk of committing acts of 
violence to disrupt the Middle East peace process.
---------------------------------------------------------------------------
    \40\ Executive Order 12947, January 23, 1995, 60 Fed. Reg. 5,079.
---------------------------------------------------------------------------
    On July 4, 1999, President Clinton used his IEEPA authority 
against the Taliban in Afghanistan.\41\
---------------------------------------------------------------------------
    \41\ Executive Order 13129 (64 Fed. Reg. 36,750). The President 
continued the emergency on July 5, 2000 (65 Fed. Reg. 41,549).
---------------------------------------------------------------------------
    President Clinton also issued IEEPA declarations with 
respect to Burma's repression of democratic oppression 
(Executive Order 13047 (62Fed. Reg. 28,301)) and the 
accumulation of weapons-usable fissile material by the Russian 
Federation (Executive Order 13159 (65 Fed. Reg. 39,279). On 
November 3, 1997, the President declared a national emergency 
under IEEPA with respect to Sudan because of its support for 
international terrorism, ongoing efforts to destablize 
neighboring governments, and the prevalence of human rights 
violations.\42\ That determination was continued.\43\
---------------------------------------------------------------------------
    \42\ Executive Order 13067 (62 Fed. Reg. 59,989).
    \43\ 65 Fed. Reg. 66,163 (November 2, 2000).
---------------------------------------------------------------------------
    Just as with the TWEA, the IEEPA authority also has been 
used on several occasions to continue in force the 
administration of export controls when extensions of the Export 
Administration Act of 1979 (EAA) have not been enacted in time 
to continue the export control authority in force by statutory 
extension. Upon the expiration of the EAA on October 15, 1983, 
President Reagan used the IEEPA authority to declare a national 
emergency and to continue in force the existing regulations for 
the administration of export controls.\44\ After the EAA was 
temporarily extended by law \45\ retroactively to October 15, 
1983, and through February 29, 1984, the President revoked its 
extension under the IEEPA and rescinded the declaration of 
economic emergency.\46\ On February 29, 1984, the EAA was again 
extended by law \47\ through March 30, 1984, when the authority 
for administering the export control provisions again had to be 
extended by the President under the IEEPA authority upon the 
declaration of a national economic emergency.\48\ The extension 
and the declared emergency remained in force during the 
protracted, if unsuccessful, House-Senate attempts at resolving 
the disagreements on the reauthorization of the EAA during the 
98th Congress and in the 99th Congress until July 12, 1985, 
when the EAA was again extended by law,\49\ the executive 
extension of export controls was revoked and the emergency 
rescinded.\50\ The President invoked the IEEPA authority on 
September 30, 1990 to maintain existing export controls upon 
expiration of the EAA on that date, pending enactment of 
further reauthorizing legislation.
---------------------------------------------------------------------------
    \44\ Executive Order 12444, October 14, 1983, 48 Fed. Reg. 48,215.
    \45\ Public Law 98-207, approved December 5, 1983, 97 Stat. 1391.
    \46\ Executive Order 12451, December 20, 1983, 48 Fed. Reg. 56,563.
    \47\ Public Law 98-222, approved February 29, 1984, 98 Stat. 36.
    \48\ Executive Order 12470, March 30, 1984, 49 Fed. Reg. 13,099.
    \49\ Export Administration Act of 1979, Reauthorization; Public Law 
99-64, approved July 12, 1985, 99 Stat. 120.
    \50\ Executive Order 12525, July 12, 1985, 50 Fed. Reg. 28,757.
---------------------------------------------------------------------------
    The 1990 extension of the export control authority under 
the IEEPA was maintained in force by means of annual 
continuations of the export control emergency until legislation 
was passed in the 106th Congress.\51\
---------------------------------------------------------------------------
    \51\ Most recently by Presidential Notice of August 15, 1996 (61 
Fed. Reg. 42,527).
---------------------------------------------------------------------------
    Congress has passed legislation that would apply IEEPA 
authority in the case of trafficking in persons.\52\
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    \52\ Section 111 of Public Law 106-386, approved October 28, 2000.
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                       Trading With the Enemy Act

    The Trading With the Enemy Act \53\ (TWEA) prohibits trade 
with any enemy or ally of an enemy during time of war. From 
enactment in 1917 until 1977, the scope of the authority 
granted to the President under this Act was expanded to provide 
the statutory basis for control of domestic as well as 
international financial transactions and was not restricted to 
trading with ``the enemy.'' In response to the use of the Act's 
authority under section 5(b) during peacetime for domestic 
purposes that were often unrelated to a preexisting declared 
state of emergency, Congress amended the Act in 1977. In 1977 
Congress removed from the TWEA the authority of the President 
to control economic transactions during peacetime 
emergencies.\54\ Similar authorities, though more limited in 
scope and subject to the accountability and reporting 
requirements of the National Emergencies Act,\55\ were 
conferred upon the President by the International Emergency 
Economic Powers Act, enacted in 1977 as title II of Public Law 
95-223.\56\ Presidential authority during wartime to regulate 
and control foreign transactions and property interests were 
retained under the Trading With the Enemy Act. In addition, the 
1977 legislation authorized the continuation of various foreign 
policy controls implemented under the Trading With the Enemy 
Act, such as trade embargoes and foreign assets controls. The 
retention of such existing controls, however, was made subject 
to 1-year extensions conditioned upon a presidential 
determination that the extension is in the national interest.
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    \53\ Public Law 65-91, approved October 6, 1917, ch. 106, 40 Stat. 
411, 50 App. U.S.C. 1-44.
    \54\ Public Law 95-223, title I, approved December 28, 1977.
    \55\ The National Emergencies Act provided a statutory role for 
Congress in the declaration and termination of national emergencies. 
Public Law 94-412, approved September 14, 1976, 90 Stat. 1255, 50 
U.S.C. 1601 et seq.
    \56\ See discussion of International Emergency Economic Powers Act, 
supra.
---------------------------------------------------------------------------

Background

    The Trading With the Enemy Act was passed in 1917 ``to 
define, regulate, and punish trading with the enemy.'' The Act 
was designed to provide a set of authorities for use by the 
President in time of war declared by Congress. In its original 
19 sections, the TWEA provided general prohibitions against 
trading with the enemy; authorized the President to regulate 
and prohibit international economic transactions by means of 
license or otherwise; established an office to administer U.S.-
held foreign property; and set up procedures for claims to such 
property by non-enemy persons, among other provisions. The 
original 1917 Act appeared not to authorize the control of 
domestic transactions and limited its use to wartime 
exigencies.
    Over the years, through use and amendment of section 5(b), 
the basic authorizing provision, the scope of presidential 
actions under the TWEA was greatly expanded. First, the Act was 
expanded to control domestic as well as international 
transactions. Second, the authorities of the Act were used to 
apply to presidentially declared periods of ``national 
emergency'' as well as war declared by Congress. From 1933, 
when Congress retroactively approved President Roosevelt's 
declaration of a national banking emergency by expanding the 
use of section 5(b) to include national emergencies, until 
1977, when Congress amended section 5(b) by passage of title I 
of Public Law 95-223, the President was authorized in time of 
war or national emergency to:
          (1) regulate or prohibit any transaction in foreign 
        exchange, any banking transfer, and the importing or 
        exporting of money or securities;
          (2) prohibit the withdrawal from the United States of 
        any property in which any foreign country or national 
        has an interest;
          (3) vest, or take title to, any such property; and
          (4) use such property in the interest and for the 
        benefit of the United States.
    The Trading With the Enemy Act did not provide a statement 
of findings and standards to guide the administration of 
section 5(b). There was no provision in the Act for 
congressional participation or review or for presidential 
reporting at specified periods for actions undertaken under 
section 5(b). There was no fixed time period for terminating a 
state of emergency. Nor was there any practical constraint on 
limiting actions taken under emergency authority to measures 
related to the emergency.

Application

    By 1977 a state of national emergency had been declared by 
the President on four occasions and left unrescinded. In 1933 
President Roosevelt declared a national emergency to close the 
banks temporarily and to issue emergency banking regulations. 
In 1950 President Truman declared a national emergency in 
connection with the Korean conflict. President Nixon declared a 
national emergency in 1970 to deal with the Post Office strike 
and another in 1971 based on the balance-of-payment crisis. As 
one measure to remedy this crisis, President Nixon at the same 
time imposed an import surcharge without specifically referring 
to section 5(b), but later did take recourse to it as an 
additional authority when the action was challenged in 
court.\57\
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    \57\ In mid-1974, the U.S. Customs Court found the President's 
action unconstitutional with respect to all invoked authorities, but 
this decision was later reversed on appeal with respect to section 
5(b). U.S. v. Yoshida International, 526, F.2d 560 (C.C.P.A. 1975). The 
surcharge was terminated after having been in force for somewhat over 4 
months, long before the lower court's decision.
---------------------------------------------------------------------------
    Based on these states of emergency, Presidents have used 
the powers of section 5(b) to deal with a number of varied 
events. In 1940 and 1941, President Roosevelt used section 5(b) 
to freeze the U.S.-held assets of the Axis powers and countries 
occupied by them to prevent their falling into the hands of the 
enemy powers. In August 1941, President Roosevelt, under 
section 5(b) authority, ordered the imposition of consumer 
credit controls by the Federal Reserve Board as an anti-
inflationary measure. These executive uses by President 
Roosevelt were retroactively ratified by Congress.
    The 1950 Korean emergency has been used in conjunction with 
section 5(b) powers for a wide range of controls among them the 
imposition of a total embargo on transactions with China and 
North Korea in December 1950 which was extended to North 
Vietnam in May 1964 and to Cambodia and South Vietnam in April 
1975.\58\ In 1968, President Johnson, citing the authority of 
section 5(b) and the continued existence of the 1950 emergency, 
imposed foreign direct investment controls on U.S. investors. 
These controls remained in effect until they were eliminated by 
legislation in 1974. During the period 1969 through 1976, 
Presidents have invoked the 1950 and 1971 emergencies to extend 
temporarily export control regulations.
---------------------------------------------------------------------------
    \58\ In mid-1971, trade embargo on China was in practice lifted, 
and on January 31, 1980, the applicability of any restrictive measures 
imposed under section 5(b) was terminated with respect to China (45 
Fed. Reg. 7,224).
---------------------------------------------------------------------------
    Four sets of regulations controlling international 
transactions with specific countries, imposed under the former 
national emergency authority of section 5(b) and during the 
Korean national emergency, were promulgated pursuant to the 1-
year extension authority of title I of Public Law 95-223. 
First, under the Foreign Assets Control Regulations, virtually 
all transactions between the United States and North Korea, 
Vietnam, and Cambodia were prohibited unless licensed by the 
Department of the Treasury. The regulations also blocked all 
assets of those countries held in the United States.
    Recently, however, the embargo with respect to Cambodia and 
Vietnam was lifted and the property of these countries in the 
United States was unblocked.\59\ Also, on October 21, 1994, the 
United States and North Korea agreed, in the context of broader 
negotiations, to begin reducing barriers to trade and 
investment. Based on these mutual commitments, a limited number 
of restrictions under the embargo against North Korea were 
lifted.\60\
---------------------------------------------------------------------------
    \59\ Foreign Assets Control Regulations; Unblocking of Cambodian 
Assets, 59 Fed. Reg. 60,558, 31 CFR part 500; Foreign Assets Control 
Regulations, Unblocking of Vietnamese Assets, 60 Fed. Reg. 12,885, 31 
CFR part 500.
    \60\ Foreign Assets Control Regulations, North Korean Travel and 
Financial Transactions; Information and Informational Materials, 60 
Fed. Reg. 8,933, 31 CFR part 500.
---------------------------------------------------------------------------
    Second, the Cuban Assets Control Regulations,\61\ based on 
section 5(b) as well as on foreign assistance legislation, (see 
also section on Embargo on transactions with Cuba) impose a 
similar ban on virtually all transactions with Cuba.
---------------------------------------------------------------------------
    \61\ 31 CFR part 515.
---------------------------------------------------------------------------
    Third, Transaction Control Regulations,\62\ prohibiting any 
person within the United States \63\ from engaging in any trade 
or trade-financing transaction involving transfer of strategic 
commodities from a foreign country to a Communist country 
(still including formerly Communist countries), are also based 
on section 5(b) of the Trading With the Enemy Act.
---------------------------------------------------------------------------
    \62\ 31 CFR part 505.
    \63\ Any ``person within the United States'' includes foreign 
subsidiaries of U.S. firms.
---------------------------------------------------------------------------
    Fourth, the wartime anti-Axis Foreign Funds Control 
Regulations,\64\ issued under the authority of section 5(b), 
are still in effect. The regulations continue to block the 
assets of Estonia, Latvia, and Lithuania pending the settlement 
of claims by U.S. citizens for compensation of property 
confiscated after the war by the Soviet governments.
---------------------------------------------------------------------------
    \64\ 31 CFR part 520.
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                      Narcotics Control Trade Act

    The Drug Enforcement, Education, and Control Act of 1986 
\65\ contains a number of measures to respond to the serious 
problem of illegal drug smuggling into the United States and 
the growing threat of foreign sourced drug production. Among 
these measures are revisions to many basic customs laws to 
deter illegal drug imports and to increase enforcement 
capabilities of the U.S. Customs Service against drug traffic.
---------------------------------------------------------------------------
    \65\ Public Law 99-570, approved October 27, 1986.
---------------------------------------------------------------------------
    Title IX of the Act amended the Trade Act of 1974 by adding 
title VIII, entitled the ``Narcotics Control Trade Act,'' to 
create new authority for the President to take appropriate 
trade actions as of March 1 of each year against uncooperative 
major drug-producing or drug-transit countries. Section 806 of 
the Foreign Relations Authorization Act, Fiscal Years 1988 and 
1989,\66\ and section 4408 of the Anti-Drug Abuse Act of 1988 
\67\ expanded the sanctions available and the critieria for 
determining and certifying that a country has cooperated fully 
with the United States. Similar criteria apply under the 
Foreign Assistance Act of 1961 for denying foreign aid to 
uncooperative countries.
---------------------------------------------------------------------------
    \66\ Public Law 100-204, approved December 22, 1987, 19 U.S.C. 
2492.
    \67\ Public Law 100-690, approved November 18, 1988.
---------------------------------------------------------------------------
    For every major drug-producing or drug-transit country, the 
President is required to deny to any or all of its products 
preferential tariff treatment under the Generalized System of 
Preferences (GSP), the Caribbean Basin Initiative (CBI), or any 
other law; to raise or impose duties of up to 50 percent ad 
valorem on any or all of its products; to suspend air carrier 
transportation to or from the United States and the country and 
to terminate any air service agreement with the country; to 
withdraw U.S. personnel and resources from participating in any 
arrangement with the country for customs preclearance; or to 
take any combination of these actions considered necessary to 
achieve the objectives of the Act.
    Such sanctions do not apply if the President determines and 
certifies to the Congress, at the time the annual report 
required by section 481(e) of the Foreign Assistance Act of 
1961 or section 489A after September 30, 1994 is submitted, 
that during the previous year the country has cooperated fully 
with the United States or has taken adequate steps on its own: 
(1) in satisfying goals agreed to in a bilateral or 
multilateral narcotics agreement with the United States; (2) in 
preventing illegal drugs from being sold illegally to U.S. 
government personnel or their dependents or from being 
transported into the United States; (3) in preventing and 
punishing the laundering of drug-related profits or monies; and 
(4) in preventing and punishing bribery and other public 
corruption which facilitate production, processing, or shipment 
of illegal drugs.
    A country that would not otherwise qualify for 
certification may be exempted from sanctions if the President 
determines and certifies to the Congress that the vital 
national interests of the United States require that sanctions 
not be applied. A country designated as a major drug-producing 
or drug-transit country in the previous year may not be 
determined to be cooperating fully unless it has in place a 
bilateral or multilateral narcotics agreement.
    The Congress may disapprove the President's determination 
and require the application of sanctions through enactment of a 
joint resolution within 45 legislative days. Actions remain in 
effect until the President submits a certification of 
cooperation and Congress does not enact a joint resolution of 
disapproval within 45 legislative days.
    In addition, section 803 prohibits the President from 
allocating any quota for imports of sugar to any country which 
has a government involved in illegal drug trade or which is 
failing to cooperate with the United States in narcotics 
enforcement activities.
    The Urgent Assistance for Democracy in Panama Act of 1990 
\68\ deemed the conditions under the Narcotics Control Trade 
Act to have been satisfied by Panama, because of U.S. vital 
national interests and because the Endara government had 
indicated its willingness and was taking steps to cooperate 
fully with the United States to control narcotics production, 
trafficking, and money laundering. Consequently, GSP and CBI 
trade benefits removed under the Noriega regime by presidential 
proclamation on March 23, 1988 were restored to the new 
government of Panama.
---------------------------------------------------------------------------
    \68\ Public Law 101-243, approved February 14, 1990, section 103.
---------------------------------------------------------------------------

   The International Security and Development Cooperation Act of 1985

    Section 505 of the International Security and Development 
Act of 1985 \69\ gives the President discretionary authority to 
restrict or ban imports from any country which the United 
States determines ``supports terrorism or terrorist 
organizations or harbors terrorists or terrorist 
organizations.'' The section requires advance consultations 
with Congress before invoking the authority and a semi-annual 
report to Congress with respect to actions taken since the last 
report and any changes which may have occurred since the last 
report. Section 504 of the Act gives the President specific 
authority to prohibit all imports to the United States from 
Libya or the export to Libya of any goods or technologies 
subject to U.S. jurisdiction.
---------------------------------------------------------------------------
    \69\ Public Law 99-83, approved August 8, 1985, 22 U.S.C. 2349 aa-
8, aa-9.
---------------------------------------------------------------------------

                The Iran and Libya Sanctions Act of 1996

    U.S. imports of goods and services of Iran have been 
prohibited since 1987. In May 1993 President Clinton 
articulated a policy of ``dual containment'' of Iran and Iraq. 
Administration officials said that Iran needed to be isolated 
because of its: (1) support for international terrorism; (2) 
efforts to undermine the Arab-Israeli peace process; (3) 
attempts to subvert other governments in the Middle East; (4) 
programs to develop weapons of mass destruction; and (5) poor 
human rights record. On March 15, 1995, the President declared 
a national emergency to respond to Iran's actions and policies 
and issued an executive order prohibiting U.S. persons from 
entering contracts to finance or manage Iran's petroleum 
resources.
    On April 30, 1995, after an internal policy review found 
that continued trade with Iran was undermining U.S. efforts to 
isolate Iran, President Clinton announced that he would impose 
significant new economic sanctions on Iran. Executive Order 
12959, issued May 8, prohibits trade in goods, services, or 
technology with Iran, re-export to Iran of U.S. goods or 
technology from third countries controlled for export, as well 
as any financing, loans, or related services for trade with 
Iran. New investment is also prohibited in Iran. The 
prohibitions also apply to foreign branches of U.S. companies. 
However, the ban provides for the licensing of crude oil swap 
arrangements with Iran in the Caspian Sea and Central Asia, and 
does not prohibit the importation to the United States of 
Iranian oil that is refined outside Iran.
     Out of a concern that the trade ban did not succeed in 
shifting international attitudes toward Iran, the President 
signed the Iran and Libya Sanctions Act \70\ on August 5, 1996, 
which mandates sanctions against foreign investment in the 
petroleum sectors of Iran and Libya as well as exports of 
weapons, oil equipment, and aviation equipment to Libya in 
violation of U.N. Resolutions 748 and 883. Congressional 
findings in this legislation state that the efforts of the 
government of Iran to acquire weapons of mass destruction and 
the means to deliver them, as well as its support for 
international terrorism, endanger the interests of the United 
States. In the case of Libya, Congress found that Libya's 
failure to comply with U.N. Resolutions 731, 748, and 883, its 
support of international terrorism, and its efforts to acquire 
weapons of mass destruction constitute a threat to 
international peace and security that endangers the national 
security of the United States.
---------------------------------------------------------------------------
    \70\ Public Law 104-172, approved August 5, 1996, 50 U.S.C. 1701.
---------------------------------------------------------------------------
    Under the Iran and Libya Sanctions Act, the President must 
impose, on any foreign person (individual, firm or government 
enterprise) that invests more than $40 million in any one year 
in the petroleum resources of Iran or Libya, or violates the 
U.N. prohibited transactions with Libya, at least two of the 
following six sanctions: (1) denial of Export-Import Bank loans 
for U.S. exports to the sanctioned entity; (2) denial of 
specific U.S. licenses for exports to the sanctioned entity 
(assuming the exports require a license to be exported); (3) 
denial of U.S. bank loans of over $10 million in one year to 
the sanctioned entity; (4) disallowing a sanctioned entity, if 
it is a financial institution, to serve as a primary dealer in 
U.S. government bonds or as a repository of U.S. government 
funds; (5) import sanctions taken by the President in 
accordance with the International Emergency Economic Powers Act 
(IEEPA); and (6) prohibition on U.S. government procurement 
from or contracting with the sanctioned person.
     The law provides for the waiving of sanctions for firms of 
countries that join a multilateral sanctions regime against 
Iran and lowers the threshold of permissible investment from 
$40 million to $20 million for firms of countries that do not 
join such a regime. The Act ``sunsets'' in 5 years.

                   Embargo on Transactions With Cuba

    While almost totally restrictive controls had been placed 
on U.S. exports to Cuba even earlier \71\ under the general 
authority of the Export Control Act of 1949, specific authority 
for a total trade embargo on Cuba was contained in section 
620(a) of the Foreign Assistance Act of 1961.\72\ Based on this 
authority ``to establish and maintain a total embargo upon all 
trade between the United States and Cuba,'' President Kennedy 
proclaimed the embargo and directed the Secretaries of the 
Treasury (for imports) and of Commerce (for exports) to 
implement it. Both Secretaries were also given the authority to 
modify the embargo in the national interest.\73\
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    \71\ 25 Fed. Reg. 1006, October 20, 1960.
    \72\ Public Law 87-195, approved September 4, 1961, 22 U.S.C. 
2370(a)(1).
    \73\ Proclamation 6447, 27 Fed. Reg. 1,085, February 7, 1962.
---------------------------------------------------------------------------
    The export embargo already being in force, the added ban on 
imports from Cuba was implemented through Cuban Import 
Regulations,\74\ to which were subsequently added, in general 
terms, all transactions falling within the authority of the 
Trading With the Enemy Act (TWEA), based on the specific 
addition of TWEA to the statutory authority for the 
regulations.\75\ Under this broader authority, Cuban Assets 
Control Regulations applicable to imports from Cuba as well as, 
in great detail, to non-trade transactions with Cuba were 
promulgated.\76\ After several changes, these regulations still 
remain in force. The embargo on transactions with Cuba is 
implemented at present for exports by the Export Administration 
Regulations (15 U.S.C. 768-799.2), particularly sections 770, 
785.1, and 799.1, and for imports and other transactions by the 
Cuban Assets Control Regulations (15 CFR 515). (These 
regulations were later codified by the Cuban Liberty and 
Democratic Solidarity Act, discussed below. A ban on imports 
from Cuba and a tightening of the regulations on non-tourist 
travel to Cuba was included in the Trade Sanctions Reform and 
Export Enhancement Act of 2000, discussed below.)
---------------------------------------------------------------------------
    \74\ 31 CFR 515, 27 Fed. Reg. 1,116, February 7, 1962.
    \75\ 27 Fed. Reg. 2,765, March 24, 1962.
    \76\ 28 Fed. Reg. 6,974, July 9, 1963.
---------------------------------------------------------------------------
    The provisions of section 620(a) of the Foreign Assistance 
Act of 1961 and the regulatory exercise with respect to Cuba of 
authorities under the TWEA, the International Emergency 
Economic Powers Act, and the Export Administration Act of 1979, 
however, were preempted by the Cuban Democracy Act of 1992 
(title XVII of the National Defense Authorization Act of 1992) 
\77\ to the extent that they have been either restated or 
modified by provisions of that Act. Section 1705 of the Act 
specifically permits donations of food to Cuban non-
governmental organizations and individuals; with some 
exceptions and subject to specific licenses and end-use 
verification, exports of medicines and medical supplies and 
equipment; providing telecommunications services and 
appropriate facilities, and issuing licenses for related 
payments; direct mail service between the United States and 
Cuba; and assistance for promoting non-violent democratic 
change in Cuba.
---------------------------------------------------------------------------
    \77\ Public Law 102-484, approved October 23, 1992; 22 U.S.C. 6001 
et seq.
---------------------------------------------------------------------------
    On the other hand, section 1706 enacts specific 
restrictions: it prohibits the issuance of licenses for any 
transactions of American-owned firms in foreign countries with 
Cuba, previously permitted by the relevant regulation; \78\ 
requires specific license for a ship to load or unload any 
freight in a U.S. port if it has traded, within the past 180 
days, with a Cuban port; or to enter a U.S. port or obtain ship 
stores if it is carrying goods or passengers to or from Cuba, 
or Cuban goods. These restrictions do not apply to activities 
allowed by sections 1705 or 1707 of the Act, or to transactions 
in informational materials unless subject to national security 
or espionage controls. The President is required to set strict 
controls on remittances to Cubans for the purpose of financing 
their travel to the United States.
---------------------------------------------------------------------------
    \78\ 31 CFR 515 and 559.
---------------------------------------------------------------------------
    The law authorizes a relaxation of the embargo by 
permitting humanitarian aid to Cuba under foreign assistance 
and Food-for-Peace legislation if the President determines that 
the Cuban government has made and is implementing commitments 
to hold free elections and respect internationally recognized 
worker rights and basic democratic freedoms, and is not 
materially supporting groups in other countries seeking violent 
overthrow of the government. The President also is authorized 
to waive the restrictions of section 1706 if he determines that 
the Cuban government has taken steps that provide various 
political, human rights, and economic freedoms, and is directed 
to take various actions (including steps to end the trade 
embargo) to assist a freely and democratically elected Cuban 
government. The Act empowers the Secretary of the Treasury to 
enforce its provisions under the authority of the TWEA, to 
which provisions for civil penalties, forfeitures, and judicial 
review are added.

            The Cuban Liberty and Democratic Solidarity Act

     In 1996, the Cuban Liberty and Democratic Solidarity Act 
was enacted to further strengthen U.S. sanctions against 
Cuba.\79\ The legislation, which is commonly referred to as 
``Helms-Burton'' or the ``Libertad Act,'' contains a number of 
new sanction provisions. Title I of the Act codifies all Cuban 
embargo executive orders and regulations in force on March 12, 
1996. No authority is granted to the President under the law to 
waive any of the codified embargo provisions.
---------------------------------------------------------------------------
    \79\ Public Law 104-114, approved March 12, 1996.
---------------------------------------------------------------------------
     In title III, the Helms-Burton legislation allows U.S. 
nationals, including Cuban-Americans who became US. citizens 
after their properties were confiscated, to sue for money 
damages in U.S. federal court those persons who traffic in 
their confiscated property. The President has the authority to 
delay implementation of title III provisions for a period of up 
to 6 months at a time if he determines that such a delay would 
be in the national interest and would expedite a transition to 
democracy in Cuba. On July 16, 1996, the President announced 
that he would allow title III to go into effect, but would 
suspend for 6 months the right of individuals to file lawsuits. 
In making his announcement, the President indicated that the 
liability of foreign companies under Helms-Burton would be 
established during the suspension period and that legal action 
could be taken against them immediately upon the lifting of the 
suspension. Since then, the implementation of title III 
provisions has been suspended by the President at 6 month 
intervals, most recently on January 16, 2001.
    Under the provisions in title IV of the Helms-Burton 
legislation, certain aliens involved in the confiscation or 
trafficking of U.S. property in Cuba are denied admission to 
the United States. The ban applies to corporate officers, 
principals, or shareholders with a controlling interest of an 
entity involved in this activity. It also applies to the 
spouses, minor children, and agents of aliens who are excluded 
under the provision. This provision of the Act is mandatory and 
is waiveable on a case-by-case basis for travel to the United 
States only for humanitarian medical reasons or to participate 
in legal actions regarding confiscated property. On June 17, 
1996, the guidelines for implementing title IV provisions were 
published in the Federal Register. \80\ This notice stipulated 
that the admission sanction would not apply to persons having 
business dealings solely with persons excluded under the 
title's provisions. To date, the State Department has banned 
from the United States a number of executives and their 
families from three companies because of their investment in 
confiscated U.S. property in Cuba: Crupos Domos, a Mexican 
telecommunications company; Sherritt International, a Canadian 
mining company; and BM Group, an Israeli citrus company. In 
1997. Grupos Domos disinvested from U.S.-claimed property, and 
as a result its executives are again eligible to enter the 
United States. Action against executives from STET, an Italian 
telecommunications company was averted by a July 1997 agreement 
in which the company agreed to pay the U.S.-based ITT 
Corporation $25 million for the use of ITT-claimed property in 
Cuba for 10 years. Currently, the State Department is 
investigating a Spanish hotel company, Sol Melia, for allegedly 
investing in property that was confiscated from U.S. citizens 
in Cuba's Holguin province in 1961.
---------------------------------------------------------------------------
    \80\ 61 Fed. Reg. 30655.
---------------------------------------------------------------------------
    In addition to these major provisions, section 103 of the 
Helms-Burton legislation prohibits loans, credits, or other 
financing by any U.S. national, U.S. agency, or permanent 
resident alien for financing transactions involving any 
property confiscated by the Cuban government, the claim to 
which is owned by a U.S. national. Section 106(d) of the Act 
requires that U.S. assistance for Russia be withheld by an 
amount equal to the sum of assistance and credits provided (on 
or after March 12, 1996) in support of the Russian intelligence 
facility at Lourdes, Cuba. The President, however, may waive 
this provision if such assistance is in the U.S. national 
security interest, and if he certifies that Russia is not 
sharing intelligence data collected at Lourdes with officials 
or agents of the Cuban government.
    Section 104 of the Act requires the United States to vote 
against Cuba's admission to the international financial 
institutions (IFIs) until a democratic government is in power. 
The provision also requires the reduction of U.S. payment to 
any IFI if it approves a loan or other assistance to Cuba over 
the opposition of the United States. Finally, title II of the 
law contains numerous conditions for determining when a 
``transition'' government and a ``democratic'' government is in 
power in Cuba, conditions which would qualify Cuba for various 
types of U.S. assistance and would lead to suspension of U.S. 
trade sanctions against Cuba.

                       Iraq Sanctions Act of 1990

    The Iraq Sanctions Act of 1990 was enacted as part of the 
Foreign Assistance and Related Program Appropriations Act for 
fiscal year 1991,\81\ in response to Iraq's invasion of Kuwait 
on August 2, 1990. The Act makes a number of declarations 
concerning Iraq's invasion of Kuwait and requires the President 
to consult with the Congress on U.S. actions taken in response.
---------------------------------------------------------------------------
    \81\ Public Law 101-513, approved November 5, 1990; sections 586 
through 586J.
---------------------------------------------------------------------------
    Section 586C enacts into law the trade embargo and other 
economic sanctions imposed on Iraq by presidential executive 
order under authority of the International Emergency Economic 
Powers Act and the National Emergencies Act.\82\ Those 
sanctions entailed a near-total prohibition on transactions 
between the United States and Iraq, including a ban on: imports 
and exports; most travel and fulfillment of contracts; and 
credits and loans. The executive orders also froze all assets 
of the governments of Iraq and Kuwait. Section 586C requires 
the President to notify Congress at least 15 days before the 
termination of any of the above sanctions. Section 586E imposes 
civil and criminal penalties on persons violating the executive 
orders.
---------------------------------------------------------------------------
    \82\ Executive Orders 12724 and 12725 (August 9, 1990), and, to the 
extent that they were still in effect on the date of enactment, 
Executive Orders 12722 and 12723 (August 2, 1990).
---------------------------------------------------------------------------
    The Iraq Sanctions Act also imposes sanctions on Iraq 
beyond those imposed by executive order. Section 586G imposes a 
wide range of sanctions, including a ban on the following 
transactions: arms sales; exports of certain goods and 
technology, including nuclear technology and equipment; U.S. 
government credits and credit guarantees; and other forms of 
assistance. Those sanctions may be waived by the President if 
he makes a certification of fundamental changes in Iraqi 
leadership, policies, or actions, under criteria set forth in 
section 586H.
    The Act contains provisions aimed at increasing compliance 
by third countries with U.N. Security Council sanctions against 
Iraq. Section 586D denies assistance under the Foreign 
Assistance Act of 1961 or the Arms Export Control Act to any 
country not in compliance with the U.N. sanctions, subject to 
certain exceptions. It also authorizes the President to ban 
imports into the United States from any country that has not 
imposed a ban on trade with Iraq, if he considers that such 
action would promote the effectiveness of the U.N. and U.S. 
sanctions against Iraq. Section 586I denies export licenses for 
super-computer exports to any country the President determines 
is assisting Iraq to improve its capabilities in rocket 
technology or chemical, biological, or nuclear weapons.
    Finally, the Iraq Sanctions Act mandates a number of 
studies and reports to Congress concerning international 
exports to Iraq of nuclear, biological, chemical and ballistic 
missile technology; Iraq's offensive military capability; and 
third country sanctions against Iraq.

 Exemptions for Food and Medicine from U.S. Unilateral Trade Sanctions

    On April 28, 1999, President Clinton announced that 
existing unilateral economic sanctions programs would be 
amended to modify licensing policies to permit case-by-case 
review of specific proposals for the commercial sale of 
agriculture commodities and products, as well as medicine and 
medical equipment, where the United States has the discretion 
to do so.\83\ Licenses are issued by the Treasury's Office of 
Foreign Assets Control.
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    \83\ 64 Fed. Reg. 41,784; 31 C.F.R. Parts 538, 550, and 560.
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Trade Sanctions Reform and Export Enhancement Act of 2000

    The ``Trade Sanctions Reform and Export Enhancement Act of 
2000'' was enacted as title IX of Public Law 106-387, the FY 
2001 agriculture appropriations bill.\84\ The Act made two 
principal changes to existing U.S. unilateral trade sanctions 
on Cuba and other countries against which the United States has 
imposed unilateral economic sanctions for foreign policy 
purposes. First, the Act prohibits 120 days after enactment 
(February 25, 2001), subject to certain exceptions, the use of 
unilateral agricultural or medical sanctions with respect to 
Cuba and other countries against which the United States has 
imposed economic sanctions for foreign policy reasons. 
Unilateral agricultural or medical sanctions are defined by the 
Act not to include any multilateral regime where the other 
members of that regime have agreed to impose substantially 
equivalent measures or a mandatory decision of the United 
Nations Security Council. The Act contains certain other 
exceptions with respect to circumstances related to war, 
biological and chemical weapons and items controlled under the 
Arms Export Control Act, the Export Administration Act.
---------------------------------------------------------------------------
    \84\ P.L. 106-387, approved October 28, 2000.
---------------------------------------------------------------------------
    The Act prohibits the availability of any U.S. governmental 
assistance, or financing by the U.S. government or a private 
person, of commercial exports to Iran, Libya, North Korea or 
Sudan, or exports to Cuba. In these cases, sales must be paid 
for by cash in advance or through third country financing. In 
the case of Iran, Libya, North Korea and the Sudan, the 
legislation authorizes the President to waive this prohibition 
for national security or foreign policy reasons.
    Second, the Act codifies existing embargo regulations by 
prohibiting both the importation of merchandise from Cuba and 
travel for tourism to Cuba. In particular, licensed travel to 
Cuba may not include travel for tourist activities. In 
addition, the Act imposes tighter restrictions on non-tourist 
travel that was previously allowed by regulations of the 
Treasury Department, listed in 31 Code of Federal Regulations 
515.560, paragraph (c), by restricting such travel to that 
expressly authorized in those regulations.
    With respect to new unilateral sanctions, the Act prohibits 
the imposition of unilateral agricultural sanctions or medical 
sanctions unless; (1) no later than 60 days before the proposed 
sanction is imposed the President submits a reports to Congress 
that describes the activity proposed to be prohibited, 
restricted, or conditioned, and describes the actions by the 
foreign country or foreign entity that justify the sanction; 
and (2) a joint resolution is enacted stating the approval of 
the Congress for the President's report. The Act sunsets any 
unilateral agricultural or medical sanction that is imposed not 
later than 2 years after the effective date of the sanction 
unless the President submits another report to Congress and 
another joint resolution is enacted.

                        The Hong Kong Policy Act

    On July 1, 1997, China assumed sovereignty over Hong Kong 
according to the terms of the Sino-British Joint Declaration of 
1994. The question of how Hong Kong will fare under Chinese 
rule is important to U.S. interests because of: (1) the large 
U.S. economic presence in Hong Kong and; (2) any adverse 
developments in Hong Kong will affect U.S.-China relations. 
Under the Sino-British Joint Declaration, China committed to 
preserving a high degree of autonomy under the so-called ``one-
China, two-systems'' policy.
    The Hong Kong Policy Act which was passed by Congress in 
1992 sets forth declarations and conditions for how the United 
States should conduct bilateral relations with Hong Kong after 
July 1, 1997.\85\ This legislation: (1) declares that support 
for democratization is a fundamental principle of the United 
States that should apply to U.S. policy toward Hong Kong after 
1997; (2) declares U.S. support for the Sino-British Joint 
Declaration and makes a number of findings of what is provided 
for under this agreement; (3) requires that the United States 
apply the same laws toward Hong Kong after 1997 as were in 
force before then, but permits the President to suspend the 
application of any law beginning in July 1, 1997, if he 
determines that China is not giving Hong Kong sufficient 
autonomy, and; (4) requires the Secretary of State to report to 
Congress every 18 months on the situation in Hong Kong, 
including the development of its democratic institutions.
---------------------------------------------------------------------------
    \85\ Public Law 102-383, approved October 5, 1992.
---------------------------------------------------------------------------
    As part of legislation granting China unconditional normal 
trade relations upon its accession to the WTO, Congress 
included a provision which states the sense of Congress that 
immediately upon approval of China's accession by the WTO 
General Council, the United States should request that the 
Council consider Taiwan's accession as the next order of 
business during the same Council session. Furthermore, the 
legislation provides that the United States should be prepared 
to aggressively counter any effort by any WTO Member to block 
Taiwan's accession after approval of the PRC's accession.\86\
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    \86\ Title VI of Public Law 106-286, approved October 10, 2000.
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        Section 27 of the Merchant Marine Act, 1920 (Jones Act)

    The Jones Act is a cabotage law that restricts the 
transportation of property by water between points in the 
United States, its possessions and territories (with very few 
exceptions) to vessels built and (if applicable) substantially 
repaired in U.S. shipyards, owned by U.S. citizens, manned by 
U.S. citizen crews, and registered in the United States. The 
first act passed by the First Congress was a cabotage measure 
that made it extremely expensive for foreign-flag, foreign-
built vessels to operate in our coasting trades. Early cabotage 
laws (1789, 1790, 1817) were, it is claimed, in response to 
similar laws enforced by England, France, and other European 
countries.
    During World War I, U.S. cabotage prohibitions were relaxed 
temporarily, but reinstated in 1920 by section 27 of the 
Merchant Marine Act, 1920, now usually referred to as the Jones 
Act. The penalty for violation is forfeiture of the cargo.

 Section 721 of the Defense Production Act of 1950, as amended (``Exon/
                               Florio'')

    The proposed purchase in 1988 of an 80 percent share of 
Fairchild Semiconductor Corporation by Fujitsu, Ltd. sparked 
congressional interest concerning takeovers of American firms 
by foreign companies which raise national security 
considerations. Section 5021 of the Omnibus Trade and 
Competitiveness Act of 1988 amended title VII of the Defense 
Production Act of 1950 \87\ to add provisions (commonly known 
as ``Exon/Florio,'' the chief congressional sponsors) because 
of concerns that the federal government lacked specific 
authority to prevent such acquisitions.
---------------------------------------------------------------------------
    \87\ 50 U.S.C. App. 2170, as added by Public Law 100-418, section 
5021, approved August 23, 1988.
---------------------------------------------------------------------------
    The provisions authorize the President, after he makes 
certain findings, to take actions for such time as he considers 
appropriate to suspend or prohibit any acquisition, merger, or 
takeover of a person engaged in interstate commerce in the 
United States by or with foreign persons so that such control 
will not threaten to impair the national security. To activate 
this authority, the President has to find that there is 
credible evidence that leads him to believe the foreign 
interest exercising control might take action that threatens to 
impair the national security and that other laws do not provide 
adequate and appropriate authority to protect the national 
security in the matter. The President has to report the 
findings to the Congress with a detailed explanation.
    In making any decision to exercise the authority under this 
provision, the President may consider such factors as: (1) 
domestic production needed for projected national defense 
requirements; (2) the capability and capacity of domestic 
industries to meet national defense requirements; and (3) the 
control of domestic industries and commercial activities by 
foreign citizens as it affects the capability and capacity of 
the United States to meet the requirements of national 
security. The standard of review is ``national security''; the 
provision affects only overseas investment flowing into the 
United States and is not intended to authorize investigations 
of investments that could not result in foreign control of 
persons engaged in interstate commerce nor to have any effects 
on transactions which are outside the realm of national 
security.
    Among the actions available to the President is the ability 
to suspend a transaction. The President may also seek 
appropriate relief in the district courts of the United States 
in order to implement and enforce the provisions, including 
broad injunctive and equitable relief including, but not 
limited to divestment relief.


                 Chapter 6: RECIPROCAL TRADE AGREEMENTS

         Reciprocal Trade Agreement Objectives and Authorities

    Section 1102 of the Omnibus Trade and Competitiveness Act 
of 1988 \1\ provided authorities for the President to enter 
into reciprocal bilateral and multilateral trade agreements 
with foreign countries to reduce or eliminate tariff or 
nontariff barriers and other trade-distorting measures. Section 
1102 replaced similar authorities under section 102 of the 
Trade Act of 1974 \2\ that expired on January 3, 1988. Except 
for the authority to proclaim modifications in U.S. tariffs 
under multilateral agreements, trade agreements entered into 
under section 1102 were subject to congressional approval of 
implementing legislation under special expedited, so-called 
``fast track'' procedures. The basic purpose of the section 
1102 authorities was to provide the means to achieve U.S. 
negotiating objectives set forth under section 1101 of the 1988 
Act and to enable U.S. participation in the Uruguay Round of 
multilateral trade negotiations under the auspices of the 
General Agreement on Tariffs and Trade (GATT) launched in 
September 1986. The authorities were also used for the North 
American Free Trade Agreement (NAFTA). The authorities expired 
on June 1, 1993, except that on July 2, 1993, section 1102 was 
amended to extend the fast track procedures to April 16, 1994 
for the sole purpose of concluding the Uruguay Round 
negotiations.\3\
---------------------------------------------------------------------------
    \1\ Public Law 100-418, approved August 23, 1988, 19 U.S.C. 2902.
    \2\ Public Law 93-618, approved January 3, 1975, 19 U.S.C. 2112.
    \3\ Public Law 103-49, approved July 2, 1993, 19 U.S.C. 2902(e).
---------------------------------------------------------------------------
    Although the fast track procedures have now expired with 
respect to new agreements, certain limited, residual authority 
remains with respect to tariffs.\4\ In addition, there are 
special trade agreement authorities that apply in limited 
circumstances or to deal with specific situations: (1) trade 
agreements entered into under section 123 of the Trade Act of 
1974,\5\ as amended by the 1988 Act, to grant new concessions 
as compensation for import relief actions or any judicial or 
administrative tariff reclassification; (2) withdrawal, 
suspension, or modification of trade agreement obligations 
under section 125 of the Trade Act of 1974; \6\ (3) agreements 
with major state trading regimes acceding to the World Trade 
Organization (WTO); (4) trade agreements and remedies under 
sections 1371-1382 of the Omnibus Trade and Competitiveness Act 
of 1988 \7\ to obtain more open foreign market access in 
telecommunications trade; and (5) bilateral trade agreements 
with certain Communist countries providing for 
nondiscriminatory (most-favored-nation) treatment under certain 
conditions.
---------------------------------------------------------------------------
    \4\ See discussion on specific trade agreement authorities which 
follows.
    \5\ Public Law 93-618, 19 U.S.C. 2133.
    \6\ Public Law 93-618, 19 U.S.C. 2135.
    \7\ Public Law 100-418, 19 U.S.C. 3101.
---------------------------------------------------------------------------

                      Trade Negotiating Objectives

    Section 1101 of the Omnibus Trade and Competitiveness Act 
of 1988 \8\ set forth overall and principal trade negotiating 
objectives of the United States. Any multilateral or bilateral 
trade agreement entered into under the authorities of the 
expired section 1102 of the 1988 Act was required to make 
progress in meeting the applicable objectives described in 
section 1101.
---------------------------------------------------------------------------
    \8\ Public Law 100-418, 19 U.S.C. 2901.
---------------------------------------------------------------------------
    Section 1124 of the 1988 Act \9\ requires the Secretary of 
the Treasury to take action to initiate bilateral currency 
negotiations on an expedited basis with a foreign party to 
trade agreement negotiations if the Secretary advises the 
President during the course of those negotiations that the 
country satisfies the criteria under section 3004(b) of the 
1988 Act relating to exchange rate manipulation.
---------------------------------------------------------------------------
    \9\ Public Law 100-418, 22 U.S.C. 5304 note.
---------------------------------------------------------------------------
    Sections 131, 135 and 315 of the Uruguay Round Agreements 
Act \10\ provide U.S. objectives for seeking a WTO working 
party on worker rights; extended negotiations in financial 
services, telecommunications, and civil aircraft; and 
intellectual property right protection. More specifically, 
section 131 requires the President to seek the establishment of 
a WTO working party to examine the relationship of 
international trade and worker rights. Section 135 sets forth 
principal U.S. negotiating objectives for the extended 
negotiations in the WTO on financial services, basic 
telecommunications, and on trade in civil aircraft. Section 315 
sets forth objectives for the Administration to pursue in the 
field of intellectual property, which include accelerating the 
implementation of the TRIPs agreement, seeking the enactment of 
effective intellectual property rights laws abroad, and 
securing fair, equitable and nondiscriminatory market access 
opportunities for U.S. intellectual property based industries.
---------------------------------------------------------------------------
    \10\ Public Law 103-465, approved December 8, 1994, 19 U.S.C. 3551, 
3555, 3581.
---------------------------------------------------------------------------
    The NAFTA Implementation Act includes a provision regarding 
congressional intent for future free trade agreements. In this 
regard, section 108 of the Act \11\ sets forth considerations 
and preliminary procedures for possible future free trade area 
agreements and accession by foreign countries to NAFTA. Article 
2204 of the NAFTA sets forth the basis for the accession of any 
country or group of countries. In the United States, accession 
would require congressional approval and implementing 
legislation. Section 108 stipulates that congressional approval 
of NAFTA with respect to Canada or Mexico does not constitute 
approval of its extension to other countries. Section 108 also 
requires the President to report to Congress on his 
recommendations for future trade agreement countries and sets 
forth general U.S. negotiating objectives for accession.
---------------------------------------------------------------------------
    \11\ Public Law 103-182, approved December 8, 1993, 19 U.S.C. 3317.
---------------------------------------------------------------------------
    Section 409 of the Trade and Development Act of 2000 
(Public Law 106-200) contains specific agricultural negotiating 
objectives of the United States for the World Trade 
Organization's negotiations on agriculture mandated by the 
Uruguay Round Trade Agreements. Section 409 also mandates 
consultations with Congress at Specific points during the 
negotiations.

                        General Tariff Authority

    Since enactment of the Reciprocal Trade Agreements Act of 
1934, the Congress periodically has delegated authority to the 
President to negotiate and to proclaim reductions in tariffs 
under reciprocal trade agreements, subject to specific 
conditions and limitations, without requiring further 
congressional action. The most recent grant of such authority 
was contained in section 1102(a) of the Omnibus Trade and 
Competitiveness Act of 1988.
    Prior to its expiration, section 1102(a) granted the 
President authority to enter into multilateral tariff 
agreements with foreign countries and to proclaim reductions in 
U.S. rates of duty required or appropriate to carry out such 
agreements, subject to the following limitations:
          (1) Reductions of existing U.S. duties cannot exceed 
        50 percent of existing rates of duty, except that 
        duties of 5 percent ad valorem or below may be reduced 
        to zero.
          (2) Staging authority requires that duty reductions 
        on any article cannot exceed 3 percent ad valorem per 
        year, or one-tenth of the total reduction, whichever is 
        greater, except that staging is not required if the 
        U.S. International Trade Commission determines there is 
        no U.S. production of the article.
          (3) Under rounding authority, annual duty reductions 
        may exceed the limits by the lesser of the difference 
        between the limit and the next lower whole number or 
        one-half of 1 percent ad valorem in order to simplify 
        computations.
Any duty reductions negotiated in a trade agreement that exceed 
50 percent of an existing duty higher than 5 percent ad valorem 
or any tariff increases would have to be approved by the 
Congress under the special fast track legislative procedures 
that apply to nontariff agreements.\12\
---------------------------------------------------------------------------
    \12\ See also the discussion on specific trade agreement 
authorities, which follows.
---------------------------------------------------------------------------
    The Uruguay Round Agreements Act provides certain limited, 
residual proclamation authority to the President with respect 
to tariffs. Specifically, section 111(a) provides very limited 
authority to the President to modify duties, change duty 
staging, and increase duties ``as the President determines to 
be necessary or appropriate to carry out schedule XX.'' In 
addition, section 111(b)(1) provides that, subject to 
consultation and layover requirements, the President may 
proclaim tariff modification or staged rate reduction if the 
United States so agrees in a WTO negotiation and if it applies 
to the duty on an article in a tariff category that ``was the 
subject of reciprocal duty elimination'' (so-called ``zero-for-
zero elimination'') ``or harmonization negotiations'' during 
the Uruguay Round.\13\ Acceleration of staging on other 
categories of tariffs would not be permitted under this 
authority. Finally, section 111(b)(2) provides that the 
President may make modifications necessary to correct 
``technical errors'' in schedule XX.
---------------------------------------------------------------------------
    \13\ This authority was used by the President in implementing U.S. 
obligations under the Information Technology Agreement concluded in 
December 1996. Pres. Proc. No. 7011, June 30, 1997, 62 Fed. Reg. 35909.
---------------------------------------------------------------------------
    The North American Free Trade Agreement Implementation Act 
of 1993 also provides some limited proclamation authority with 
respect to tariffs. Specifically, section 201(a) provides the 
President with the very limited authority to modify duties, 
change duty staging, and increase duties as he ``determines to 
be necessary or appropriate to carry out or apply'' the 
Agreement. In addition, section 201(b) provides that, subject 
to consultation and layover requirements, the President may 
proclaim: tariff modifications or continuations, or staged rate 
modifications if the United States, Canada, and Mexico agree; 
continuation of duty-free treatment; and increased duties ``as 
the President determines to be necessary or appropriate to 
maintain the general level of reciprocity and mutually 
advantageous concessions with respect to Canada and Mexico 
provided for by the Agreement.''
    The Uruguay Round Agreements Act also provides authority 
for the President to increase duties on articles from countries 
which are not WTO members. Section 111(c) of the Act \14\ 
authorizes the President, after congressional consultation, to 
increase duties on imports from countries that are not members 
of the WTO, or to which the United States does not apply the 
WTO, if he determines that the country is not according 
adequate trade benefits to the United States, including 
substantially equivalent competitive opportunities. The maximum 
rate of duty that may be proclaimed is the higher of the pre-
Uruguay Round most-favored-nation (MFN) rate or the MFN rate of 
duty that will apply under the Uruguay Round schedule XX.
---------------------------------------------------------------------------
    \14\ Public Law 103-465, 19 U.S.C. 3521.
---------------------------------------------------------------------------

                 Multilateral Trade Agreement Authority

    Trade negotiations prior to the Tokyo Round concentrated 
primarily on reducing or eliminating tariffs. Relatively little 
effort and progress was made to reduce nontariff barriers or 
other trade-distorting measures such as subsidies. Section 102 
of the Trade Act of 1974 resulted from considerable concern 
about the growing importance and proliferation of such 
practices to the detriment of U.S. export trade and the need to 
develop new or more adequate international trading rules and 
mechanisms for their discipline. The purpose of section 102 
was: (1) to make clear the importance of reducing, eliminating, 
or harmonizing nontariff barriers and other trade-distorting 
measures through a congressional policy mandate and specific 
authority for the President to negotiate and enter into 
reciprocal nontariff barrier trade agreements as the major 
focus of the Tokyo Round of GATT multilateral trade 
negotiations; (2) to expedite and reduce the uncertainties of 
the legislative process for approval and implementation of such 
trade agreements, thereby encouraging and facilitating 
negotiations with foreign governments; and (3) to increase and 
formalize the role of the Congress during the negotiating 
process and in the development of implementing legislation. The 
authority applied to U.S. foreign direct investment as well as 
to trade in both goods and services.
    Section 102 of the Trade Act of 1974 authorized the 
President to enter into reciprocal trade agreements for 5 
years, until January 3, 1980, subject to congressional 
consultation requirements and approval of the agreements in 
implementing legislation considered under special expedited 
fast track procedures. Section 102 authority was used 
successfully to approve the agreements negotiated in the Tokyo 
Round and to make the changes in U.S. laws necessary for their 
domestic implementation under the Trade Agreements Act of 1979. 
That law extended the section 102 authority for an additional 8 
years, until January 3, 1988, to enable the President to 
negotiate improvements or adjustments in existing agreements 
and to negotiate and enter into new agreements on non-tariff 
measures not dealt with in the Tokyo Round.
    Section 102 authority was replaced by similar authority 
under section 1102(b) of the Omnibus Trade and Competitiveness 
Act of 1988. A trade agreement could be entered into under this 
authority only if it made progress in meeting the applicable 
objectives set forth in section 1101 of the 1988 Act.
    Section 1102(b) authorized the President to enter into 
trade agreements with foreign countries providing for the 
reduction or elimination of any nontariff barriers or other 
distortions to trade, or for the prohibition of or limitations 
on the imposition of such barriers or distortions, before June 
1, 1993, subject to implementation under the special fast track 
congressional approval procedures. The President was to provide 
the Congress at least 90 calendar days advance notice, i.e., no 
later than March 2, 1993, of his intention to enter into a 
trade agreement no later than May 31.
    On July 2, 1993, section 1102 was amended to extend the 
fast track approval procedures to April 16, 1994 for the 
Uruguay Round negotiations, provided the President notified the 
Congress of his intent to enter into an agreement at least 120 
days in advance (i.e., by December 15, 1993). The amendments 
also granted the private sector advisory committees an 
additional 30 days (but before January 15, 1994) to submit 
their reports on the proposed agreement.

                  Bilateral Trade Agreement Authority

    The expired section 1102(c) of the Omnibus Trade and 
Competitiveness Act of 1988 authorized the President to enter 
into bilateral tariff and nontariff agreements with foreign 
countries, subject to the same congressional consultation 
requirements and special fast track procedures for approval of 
implementing legislation as apply to multilateral agreements. 
The authority to enter into bilateral trade agreements applied 
to trade agreements entered into before June 1, 1993, and was 
subject to the same minimum 90-day advance notice requirement 
as the multilateral authority.
    Section 1102(c) authorized the elimination or reduction of 
any U.S. duty or for the elimination or reduction of nontariff 
barriers or other trade distorting measures. No trade benefit 
under the Agreement could be extended to a third country. The 
authority was similar to that which was used for the bilateral 
free trade agreements between the United States and Israel and 
the United States and Canada. The provision set forth three 
requirements for the negotiation of a bilateral agreement:
          (1) The foreign country must request the negotiation 
        of a bilateral trade agreement;
          (2) The agreement must make progress in meeting 
        applicable U.S. trade negotiating objectives; and
          (3) The President must provide written notice of the 
        negotiations to the House Committee on Ways and Means 
        and the Senate Committee on Finance and consult with 
        these committees regarding the negotiation of an 
        agreement. The negotiations may proceed unless either 
        Committee disapproves the negotiations within 60 
        legislative days prior to the 90 calendar day advance 
        notice required of entry into an agreement.
    These multilateral and bilateral trade agreement 
authorities, which were originally due to expire as of June 1, 
1991, were extended for an additional 2 years under procedures 
provided under section 1103(b) of the 1988 Act. On March 1, 
1991, President Bush submitted a report to the Congress 
requesting extension of the fast track trade agreement 
authorities as essential in particular for (1) completing the 
Uruguay Round of GATT multilateral trade negotiations, (2) 
proposed negotiations of NAFTA with Mexico and Canada, and (3) 
pursuit of free trade agreements with Latin American countries 
under the Enterprise for the Americas Initiative announced by 
the President on June 27, 1990.\15\ In a subsequent letter on 
May 1, 1991, the President made commitments to the Congress in 
response to concerns raised about the proposed NAFTA 
negotiations. Neither House of Congress disapproved extension 
of the trade agreement authority for an additional 2-year 
period prior to the June 1, 1991 expiration date for 
disapproval.
---------------------------------------------------------------------------
    \15\ ``The Extension of Fast Track Procedures,'' Message from the 
President of the United States, House Document 102-51, March 4, 1991.
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                  Reciprocal Competitive Opportunities

    Prior to its expiration, section 1105(b) of the Omnibus 
Trade and Competitiveness Act of 1988 \16\ required the 
President to determine before June 1, 1993 (the final 
expiration date of trade agreement authority) whether any major 
industrial country had failed to make trade agreement 
concessions which provide competitive opportunities for the 
United States substantially equivalent to such concessions 
provided by the United States. If the determination was 
affirmative with respect to any country, the President was to 
recommend to the Congress legislation to terminate or deny 
trade agreement concessions in order to restore equivalence.
---------------------------------------------------------------------------
    \16\ Public Law 100-418, 19 U.S.C. 2904.
---------------------------------------------------------------------------

                  Specific Trade Agreement Authorities

    Sections 123 and 125 of the Trade Act of 1974, as amended 
by the Trade and Tariff Act of 1984 and the Omnibus Trade and 
Competitiveness Act of 1988, as well as section 111 of the 
Uruguay Round Agreements Act and section 201 of the North 
American Free Trade Agreement Implementation Act, contain 
authorities to enter into and/or to proclaim changes in U.S. 
duties under trade agreements in certain specific limited 
circumstances.

Compensation agreements

    Section 123 of the Trade Act authorizes the President to 
enter into trade agreements granting new concessions and to 
proclaim modifications or continuation of existing duties or 
duty-free treatment as he determines required or appropriate as 
compensation to foreign countries for restrictions imposed as 
import relief under section 203 of the Trade Act or for any 
judicial or administrative tariff reclassification. No duty 
reduction can exceed 30 percent of its existing level. The 
purpose of such concessions is to meet international 
obligations under the WTO to maintain the general level of 
reciprocal and mutually advantageous concessions with countries 
whose trade is adversely affected by import relief measures or 
certain tariff reclassifications, and provide an alternative to 
the right of such countries under the WTO to take retaliatory 
action.

Termination and withdrawal authority

    Section 125 of the Trade Act contains the traditional 
requirement that every trade agreement entered into is subject 
to termination or withdrawal within 3 years after its effective 
date, or upon 6 months advance notice thereafter. The President 
may terminate any proclamation at any time.
    Section 125(c) provides the President explicit domestic 
legal authority to proclaim increased duties or other import 
restrictions as he deems necessary or appropriate to implement 
U.S. international trade agreement rights or obligations to 
withdraw, suspend, or modify any trade agreement concessions.
    Section 125(d) authorizes the President to withdraw, 
suspend, or modify substantially equivalent trade agreement 
obligations and proclaim increased duties or other import 
restrictions in response to withdrawal suspension, or 
modification by foreign countries of trade obligations 
benefitting the United States without granting adequate 
compensation (i.e., ``self-compensation'' authority). This 
authority was used in November 1982 by President Reagan to 
suspend most-favored-nation status for Poland indefinitely, 
based upon Poland's nonfulfillment of trade obligations 
undertaken in its accession to the GATT, and in view of 
increased repression of the Polish people by the martial law 
government.
    No duty increase imposed under section 125(d) can exceed 
the higher of 50 percent or 20 percent ad valorem above the 
rate existing on January 1, 1975. Public hearings are required 
prior to taking any action, or promptly thereafter if 
expeditious action is necessary.
    Section 125(e) requires duties or other import restrictions 
to remain in effect at negotiated levels for 1 year after U.S. 
termination of, or withdrawal from, a trade agreement, unless 
the President proclaims restoration of the previous level. The 
President must submit his recommendations to the Congress 
within 60 days as to the appropriate rates of duty on all 
affected articles. This provision prevents automatic, sudden 
``snapbacks'' to higher preagreement duties that could create 
serious economic impact.

Accession of major state trading regimes to the WTO

    Section 1106 of the Omnibus Trade and Competitiveness Act 
of 1988,\17\ as amended, requires the President to determine, 
before any major foreign country accedes to the WTO, whether 
state trading enterprises (1) account for a significant share 
of that country's exports or of its goods subject to import 
competition, and (2) whether those enterprises unduly burden or 
restrict or adversely affect U.S. trade or the U.S. economy or 
are likely to have such results. If both determinations are 
affirmative, the WTO cannot apply between the United States and 
that country until either (1) the country enters into an 
agreement with the United States for its state trading 
enterprises to operate in accordance with commercial 
considerations, or (2) Congress approves fast track legislation 
submitted by the President extending application of the WTO to 
the country.
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    \17\ Public Law 100-418, 19 U.S.C. 2905.
---------------------------------------------------------------------------

               Trade Negotiation Procedural Requirements

    Sections 131-135 of the Trade Act of 1974,\18\ as amended 
by the Omnibus Trade and Competitiveness Act of 1988, require 
that certain procedures be followed in connection with any 
proposed trade agreement under section 123 of the 1974 Act or 
expired section 1102 of the 1988 Act. These prenegotiation 
procedures require advice from the International Trade 
Commission on the probable economic effect of duty 
modifications on U.S. industries (section 131), advice from 
executive branch agencies and other sources (section 132), 
public hearings (section 133), and advice from private sector 
advisory committees (section 135). In addition, executive 
liaison with the Congress is required through congressional 
designated official advisers to negotiations (section 161), 
transmittal of trade agreements (section 162), and annual 
reports on the trade agreements program and related matters 
(section 163). (See also discussion of Congress in chapter 7, 
infra.)
---------------------------------------------------------------------------
    \18\ Public Law 93-618, 19 U.S.C. 2151.
---------------------------------------------------------------------------
    Section 127 of the Trade Act of 1974 \19\ requires the 
reservation from any negotiations involving reduction or 
elimination of duties or other import restrictions of any 
article while it is subject to an import relief action under 
section 203 of that Act or to a national security action under 
section 232 of the Trade Expansion Act of 1962, or if the 
President determines that the national security would be 
impaired.
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    \19\ Public Law 93-618, 19 U.S.C. 2137.
---------------------------------------------------------------------------

            Congressional Fast Track Implementing Procedures

    In contrast to traditional tariff proclamation authority, 
nontariff barrier agreements entered into under section 102 of 
the Trade Act of 1974, or the expired section 1102(b) of the 
Omnibus Trade and Competitiveness Act of 1988, and bilateral 
trade agreements entered into under expired section 1102(c) 
authority under the 1988 Act could not enter into force for the 
United States and become binding as a matter of domestic law 
unless and until the President complied with specific 
requirements for consultation with the Congress and 
implementing legislation approving the Agreement and any 
changes in U.S. law was enacted into law.
    The purpose of the approval process is to preserve the 
constitutional role and fulfill the legislative responsibility 
of the Congress with respect to agreements which often involve 
substantial changes in domestic laws. The consultation and 
notification requirements prior to entry into an agreement and 
introduction of an implementing bill ensure that congressional 
views and recommendations with respect to provisions of the 
proposed agreement and possible changes in U.S. law or 
administrative practice are fully taken into account and any 
problems resolved in advance of formal congressional action. At 
the same time, the procedure ensures certain and expeditious 
action on the results of the negotiation and on the 
implementing bill with no amendments. Sections 102 of the 1974 
Act, and 1102(d) and 1103 of the 1988 Act set forth the 
consultation and documentation requirements,\20\ and 151-154 of 
the 1974 Act \21\ prescribed the following procedures for 
congressional fast track approval, as follows:
---------------------------------------------------------------------------
    \20\ Public Law 100-418, 19 U.S.C. 2903.
    \21\ Public Law 93-618, 19 U.S.C. 2191.
---------------------------------------------------------------------------
          (1) Before entering into any trade agreement, the 
        President is required to consult with the House 
        Committee on Ways and Means, the Senate Committee on 
        Finance, and with each other committee in the House and 
        Senate with jurisdiction over legislation involving 
        subject matter affected by the Agreement. The 
        consultation includes (a) the nature of the Agreement; 
        (b) how and to what extent the Agreement will achieve 
        applicable purposes, policies, and objectives; and (c) 
        all matters relating to agreement implementation.
          (2) The President is required to give the Congress at 
        least 90 calendar days (120 calendar days for the 
        Uruguay Round Agreements) advance notice of his 
        intention to enter into a trade agreement, and promptly 
        publish the intention in the Federal Register. The 
        purpose of this notice period is to provide the 
        congressional committees of jurisdiction an opportunity 
        to review the proposed agreement before it was signed, 
        to determine the changes in U.S. laws that would be 
        necessary or appropriate to implement the obligations 
        under the Agreement, and to meet with Administration 
        officials to develop the text of an acceptable 
        implementing bill.
          (3) After entering into the Agreement, the President 
        is required to submit a copy of the final legal text to 
        the Congress, together with a draft implementing bill, 
        a statement of any administrative action proposed to 
        implement the Agreement, and supporting information 
        ((a) an explanation of how the bill and proposed 
        administrative action would change or affect existing 
        law; and (b) a statement asserting that the Agreement 
        made progress in achieving applicable purposes, 
        policies, and objectives; the reasons the Agreement 
        made such progress and why and to what extent it did 
        not achieve other purposes, policies, and objectives; 
        how the Agreement served the interests of U.S. 
        commerce; why the implementing bill and proposed 
        administrative action were required or appropriate to 
        carry out the Agreement; efforts made by the President 
        to obtain international exchange rate equilibrium and 
        any effect the Agreement may have regarding increased 
        monetary stability; and the extent, if any, to which 
        each foreign party to the Agreement maintained non-
        commercial state trading enterprises that may adversely 
        affect, nullify, or impair the benefits to the United 
        States under the Agreement and how the Agreement 
        applied to or affected purchases and sales by such 
        enterprises).
          There is no statutory time limit for submission of 
        the Agreement and draft bill after entry into the 
        Agreement. The timetable is worked out between the 
        congressional leadership and the Administration to 
        accommodate the need for committees of jurisdiction to 
        have adequate opportunity to develop an acceptable 
        draft bill text while also ensuring expeditious formal 
        action on the actual implementing legislation.
          (4) The implementing bill is introduced by the 
        leadership in both Houses of Congress on the same day 
        it is submitted by the President and referred to the 
        committees of jurisdiction. The committees have 45 
        legislative days in which to report the bill; they are 
        discharged automatically from further consideration 
        after that period.
          (5) Each House votes on the bill within 15 
        legislative days after the measure has been received 
        reported or discharged from the committees. A motion in 
        the House to proceed to consideration of the 
        implementing bill is highly privileged and not 
        debatable. Motions to recommit or reconsider the vote 
        are not in order. Amendments are not in order.
    No amendments to the implementing bill are in order in 
either the House or the Senate once the bill had been 
introduced; the committee and floor actions in the House and 
Senate consist of ``up or down'' votes on the bill as 
introduced. The total maximum period for congressional 
consideration from date of introduction is 60 legislative days 
if the bill was not a revenue measure. Since the Senate must 
act on a House-passed revenue bill, the maximum period for 
congressional consideration of a revenue implementing bill from 
date of introduction is 90 legislative days (15 additional days 
for Senate committee action on the House-passed measure and 15 
additional days for Senate floor action). After the legislation 
is signed by the President, the Agreement goes into effect 
under the terms of the Agreement and the implementing bill.
    Section 1103(c) of the 1988 Act instituted a ``reverse fast 
track'' procedure that terminated the application of that 
special procedure for the approval of trade agreements if both 
the Committee on Ways and Means and the Committee on Rules in 
the House and the Committee on Finance in the Senate reported, 
and both the House and Senate separately passed, resolutions of 
disapproval within any 60 legislative day period. The basis for 
the disapproval was failure or refusal of the U.S. Trade 
Representative (USTR) to consult with the Congress on trade 
negotiations and trade agreements as set forth in the 
consultation requirements. The fast track procedure applied to 
floor consideration of the resolution, which was nonamendable.
    In addition, the 1974 and 1988 Acts provided for 
congressional advisers and consultations with committees of 
jurisdiction throughout the course of trade agreement 
negotiations (section 161 of the 1974 Act) and an advisory 
committee structure for private sector input during 
negotiations and reports on the results (section 135 of the 
1974 Act). The congressional consultation requirements and fast 
track procedures applied to the implementing legislation for 
the Tokyo Round of GATT multilateral trade negotiations in 
1979, the United States-Israel Free Trade Agreement and the 
United States-Canada Free-Trade Agreement, the North American 
Free Trade Agreement, and the Uruguay Round of GATT 
multilateral trade negotiations, including the Agreement 
Establishing the World Trade Organization.
    Special fast track procedures under section 3(c) of the 
Trade Agreements Act of 1979 also applied to implementation of 
changes in the Tokyo Round Agreements and to the United States-
Canada Free-Trade Agreement for an initial 30-month period. 
Section 3(c), which currently applies to implementation of 
changes in the United States-Israel Free Trade Agreement and 
the GATT Agreement on Civil Aircraft,\22\ requires the 
President to submit a draft bill and statement of any 
administrative action to the Congress whenever he determines it 
is necessary or appropriate to amend, repeal, or enact a 
statute to implement any requirement, amendment, or 
recommendation concerning an agreement. The President is 
required to consult at least 30 days in advance with the House 
Committee on Ways and Means and the Senate Committee on Finance 
and any other committees of jurisdiction on the subject matter 
and implementation.
---------------------------------------------------------------------------
    \22\ Public Law 96-39, approved July 26, 1979, 19 U.S.C. 2504.
---------------------------------------------------------------------------
    While the authorities to enter into new trade agreements 
for congressional approval under fast track implementing 
procedures expired upon conclusion of the Uruguay Round 
negotiations, the fast track legislative procedures under 
sections 151-154 of the 1974 Act continue to apply to (1) 
resolutions approving bilateral commercial agreements extending 
normal trade relations (NTR) treatment to countries which are 
subject to the provisions of title IV of the Trade Act of 1974; 
(2) joint resolutions disapproving annual presidential 
determinations to extend authority to waive freedom of 
emigration requirements under title IV; (3) joint resolutions 
disapproving presidential reports of country compliance with 
freedom of emigration requirements under title IV; (4) joint 
resolutions disapproving presidential import relief actions 
under section 203 of the Trade Act of 1974 which differ from 
recommendations of the International Trade Commission; and (5) 
joint resolutions withdrawing congressional approval of the WTO 
Agreement after 5 years and every 5 years thereafter. While the 
procedures applicable to implementing bills and resolutions and 
to joint disapproval resolutions are similar, the time periods 
for committee and House and Senate consideration differ 
(shorter periods for disapproval resolutions), and the overall 
time periods for congressional consideration is generally 
subject to the terms of the statute involved.
    Although statutory, the fast track legislative procedures 
were enacted as an exercise of the rulemaking powers of each 
House of Congress, and are part of each House's rules. The 
procedures may be changed in the same manner as any other 
rules.

                        Uruguay Round Agreements

    The Uruguay Round Agreements represented the culmination of 
negotiations among 125 countries over an 8-year period launched 
in Punta del Este, Uruguay in September 1986 under the auspices 
of the GATT and concluded in Geneva, Switzerland on December 
15, 1993. On that date President Clinton provided the Congress 
the required 120-day advance notice of his intention to enter 
into the Agreements. The Agreements were signed in Marrakesh, 
Morocco on April 15, 1994 by 111 countries, including the 
United States, thereby undertaking the commitment to bring the 
results before their respective legislatures for approval.
    Sections 1101-1103 of the Omnibus Trade and Competitiveness 
Act of 1988, as extended by Public Law 103-49, set forth U.S. 
negotiating objectives and authority and implementing 
procedures necessary for U.S. participation. As required by 
Public Law 103-49, the private sector advisory committees 
established under section 135 of the Trade Act of 1974 
submitted their reports assessing the Agreements to the 
President, the USTR and the Congress on January 14, 1994.
    On September 27, 1994, President Clinton sent a letter of 
transmittal to the House and Senate covering: (1) transmittal 
of the final texts of the Uruguay Round agreements, including 
the Agreement establishing the World Trade Organization; (2) 
the draft implementing bill and Statement of Administrative 
Action; and (3) supporting documents, as required by section 
1103 of the 1988 Act.\23\
---------------------------------------------------------------------------
    \23\ Public Law 100-418, 19 U.S.C. 2903.
---------------------------------------------------------------------------
    As provided under section 151 of the Trade Act of 1974,\24\ 
as amended, the implementing legislation was introduced in the 
House on September 27 as H.R. 5110 by Majority Leader Gephardt, 
for himself and Minority Leader Michel by request, and jointly 
referred to eight committees of jurisdiction for a period 
ending October 3, 1994. On November 29, 1994, H.R. 5110 passed 
the House and was sent to the Senate for consideration, where 
it passed on December 1. On December 8, 1994, the bill was 
signed into law by the President.
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    \24\ Public Law 93-618, 19 U.S.C. 2191.
---------------------------------------------------------------------------
    The Uruguay Round Agreements are the broadest, most 
comprehensive trade agreements in history. The Agreements cut 
global tariffs by more than one-third, and reduce or eliminate 
numerous nontariff measures, such as quotas, restrictive 
licensing systems, and discriminatory product standards.
    The agreements also contain multilateral rules covering 
such matters as technical barriers to trade, trade-related 
investment measures (TRIMs), rules of origin, import licensing 
procedures, safeguards, trade-related aspects of intellectual 
property rights (TRIPs), antidumping/countervailing duties, 
agriculture trade, and government procurement. In addition, the 
General Agreement on Trade in Services (GATS) establishes a 
framework of rules for trade and investment in services 
sectors, including most-favored-nation (MFN) and national 
treatment, market access, transparency, and the free flow of 
payments and transfers. Many of these agreements are addressed 
in detail in other chapters of this book.
    The Agreement Establishing the World Trade Organization 
establishes an international organization which encompasses the 
existing GATT institutional structure and extends it to the new 
Uruguay Round disciplines on services, intellectual property, 
and investment.
    The Understanding on Rules and Procedures Governing the 
Settlement of Disputes creates new procedures for settlement of 
disputes arising under any of the Uruguay Round agreements and 
provides time limits for each step in the process. The 
Understanding creates a more automatic process, including the 
right to a panel, adoption of panel reports unless there is a 
consensus to reject the report, appellate legal review on 
request, time limits for country conformity with panel rulings 
and recommendations, and authorization of retaliation if such 
limits are not met.

                      Uruguay Round Agreements Act

    The Uruguay Round Agreements Act approves the trade 
agreements resulting from the Uruguay Round of multilateral 
trade negotiations under the auspices of the General Agreement 
on Tariffs and Trade (GATT) entered into by the President on 
April 15, 1994. The legislation and the Statement of 
Administrative Action (SAA) proposed to implement the 
Agreements were submitted to the Congress on September 27, 
1994. The legislation includes provisions that are necessary or 
appropriate to implement the Uruguay Round Agreements in U.S. 
domestic law. Also included are provisions to offset the 
projected cost of the implementing legislation in order to 
comply with the ``pay-as-you-go'' requirements of the Budget 
Enforcement Act.
    The legislation contains general provisions on: (1) 
approval and entry into force of the Uruguay Round Agreements, 
and the relationship of the Agreements to U.S. laws (section 
101 of the Act \25\); (2) authorities to implement the results 
of tariff negotiations (section 111 of the Act \26\); (3) 
procedures regarding implementation of dispute settlement 
proceedings affecting the United States and oversight of 
activities of the World Trade Organization (WTO) (sections 121-
130 of the Act \27\); and (4) objectives regarding extended 
Uruguay Round negotiations and other related provisions 
(sections 131, 135 and 315 of the Act \28\).
---------------------------------------------------------------------------
    \25\ Public Law 103-465, 19 U.S.C. 3511.
    \26\ Public Law 103-465, 19 U.S.C. 3521.
    \27\ Public Law 103-465, 19 U.S.C. 3531-3538.
    \28\ Public Law 103-465, 19 U.S.C. 3551, 3555, and 3581.
---------------------------------------------------------------------------
    Specifically, sections 121-130 of the Act \29\ contain 
procedural requirements for notice, consultation, and reporting 
to ensure access to, and advice by, congressional committees, 
private sector advisory committees, and the public regarding 
the dispute settlement mechanism under the WTO. In order to 
ensure that the WTO continues the practice followed by the GATT 
of decisionmaking by consensus, USTR must consult with Congress 
before any vote is taken in the WTO that would substantially 
affect U.S. rights or obligations under the Agreement or 
another multilateral trade agreement, or potentially entails a 
change in federal or state law. Within 30 days after the end of 
any year in which the WTO takes such a vote, USTR will submit a 
report to the appropriate congressional committees describing 
the decision, U.S. efforts to achieve consensus, country 
voting, how the decision affects the United States, and the 
President's response. The dispute settlement procedures set 
forth in the Act also include a provision requiring USTR to 
inform, consult, and report to Congress, private sector 
advisory committees, and the public during each stage of the 
process. Promptly after the establishment of a panel, USTR will 
publish a notice in the Federal Register identifying the 
parties to the dispute, setting forth the major issues raised 
and the legal basis of the complaint, identifying the specific 
measures cited in the request for the panel, and seeking 
written comments from the public on the issues raised. The USTR 
will take into account any advice received from Congress and 
the advisory committees and the written comments in preparing 
U.S. submissions to the panel or Appellate Body. In addition, 
USTR is required to submit an annual report to the Congress on 
the structure, budget and activities of the WTO, and details of 
dispute settlement actions.
---------------------------------------------------------------------------
    \29\ Public Law 103-465, 19 U.S.C. 3531-3538.
---------------------------------------------------------------------------
    The legislation contains a number of other provisions which 
affect the administration of U.S. trade laws. Included in the 
legislation are provisions amending the U.S. antidumping and 
countervailing duty laws in response to the Uruguay Round 
Antidumping and Subsidies/Countervailing Measures Agreements. 
The legislation implement in U.S. domestic law various 
provisions of the Uruguay Round Agreements relating to import 
safeguard measures; foreign trade barriers and unfair trade 
practices in import trade (section 337 of the Tariff Act of 
1930); textiles and apparel trade; government procurement; and 
technical barriers to trade (product standards). Also included 
are provisions implementing the Agreement on Agriculture and 
the Agreement on Trade-Related Aspects of Intellectual Property 
Rights. The legislation also contains provisions extending 
expiring programs and amendments to certain customs laws 
related to the Uruguay Round Agreements, conforming amendments 
to various laws to reflect the implementation of the 
Agreements, as well as a number of revenue and other non-trade 
provisions to meet budgetary offset requirements. These 
provisions are discussed in greater detail in other chapters of 
this book.

Post Uruguay Round Negotiations

    The GATS was the first multilateral, legally enforceable 
agreement covering trade and investment in services. The GATS 
was designed to reduce or eliminate governmental measures that 
prevent services from being freely provided across national 
borders or that discriminate against locally-established 
service firms with foreign ownership. After the WTO went into 
effect, negotiations continued on certain services under the 
auspices of the WTO: information technology, basic 
telecommunications services, financial services, and maritime 
services.

Information Technology Agreement

    During the December 1996 WTO Ministerial Meeting in 
Singapore, trade ministers from 28 WTO-member countries 
endorsed an agreement liberalizing market access in the 
information technology industry. This Information Technology 
Agreement (ITA) eliminated tariffs on information technology 
products by the year 2000 on a wide range of technology 
products. The ITA was finalized on March 26, 1997, and entered 
into force on July 1, 1997. As of this writing, the ITA has 55 
participants representing over 95 percent of global trade in 
this sector.
    ITA product coverage includes computers and computer 
equipment, semiconductors and integrated circuits, computer 
software products, telecommunications equipment, semiconductor 
manufacturing equipment and computer-based analytical 
instruments. Some limited staging up to 2005 was granted on a 
country-by-country basis for individual products. The ITA, thus 
far, is the only global sectoral agreement in which 
participating governments have agreed on a uniform list of 
products on which all duties will be eliminated. The products 
subject to the ITA were covered by the residual proclamation 
authority provided by section 111(b) of the Uruguay Round 
Agreements Act and, thus, no additional implementing authority 
was necessary.\30\
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    \30\ Pres. Proc. No. 7011, June 30, 62 Fed. Reg. 35,909.
---------------------------------------------------------------------------
    Work to review possibilities for product coverage expansion 
(also as ITA-II continued in 2000), as did efforts to address 
non-tariff measures affecting trade in ITA-covered products.

WTO Basic Telecommunication Services Agreement

    As part of the GATS, WTO members have made both basic and 
value-added telecommunications commitments. Specifically, the 
Fourth Protocol to the GATS--generally referred to as the WTO 
Basic Telecommunications Services Agreement--is the legal 
instrument embodying basic telecommunications services 
commitments of seventy WTO members under the GATS. The 
agreement entered into force on February 6, 1998, and since 
that time, an additional ten WTO members have made 
telecommunications services commitments, some upon their 
accession to the WTO. Due in large part to this agreement, 
mutually advantageous market opportunities for U.S. 
telecommunications equipment and service suppliers expanded 
greatly.
    The WTO basic telecommunications services agreement built 
upon the Annex on telecommunications, part of the General 
Agreement on Trade in Services (GATS), itself a component of 
the Uruguay Round Final Act. The Annex requires WTO members to 
ensure that all service suppliers seeking to take advantage of 
scheduled commitments have reasonable and non-discriminatory 
access to, and the use of, public basic telecommunications 
networks and services. The agreement covers basic 
telecommunications services only. Participants agreed at the 
start of the talks to disregard differences in how countries 
might define ``basic'' telecommunications, and to negotiate on 
all public and private information (voice or data) from sender 
to receiver. Whereas the Annex on telecommunications addresses 
access to existing services and networks by users, the WTO 
basic telecommunications agreement addresses the ability to 
enter telecommunications markets and sell services. Examples of 
the services covered by this agreement include voice telephony, 
data transmission, telex, telegraph, facsimile, private leased 
circuit services (i.e., the sale or lease of transmission 
capacity), fixed and mobile satellite systems and services, 
cellular telephony, mobile data services, paging, and personal 
communications systems.
    As of January 2001, the basic telecommunications services 
agreement encompasses 80 countries. Other countries in the 
process of acceding to the WTO are also expected to make 
commitments in the telecommunications sector. In December 2000, 
the United States put forward a new proposal on 
telecommunications and related services as part of a package of 
U.S. sectoral proposals.

1997 Financial Services Agreement

    With respect to extended negotiations on financial 
services, the United States, because of insufficient market-
opening commitments from many of its trading partners, 
committed in July 1995 to protect the existing investments of 
foreign financial service providers in the United States but 
reserved the right to provide differing levels of treatment 
with respect to any new activities by such providers, or with 
respect to new entrants to the U.S. financial services market. 
The interim agreement expired at the end of 1997. Negotiations 
were renewed in April 1997 and ended December 1997 with a new 
agreement that covered 95 percent of the global financial 
services market as measured in revenue. Of the seventy WTO 
Members that made improved commitments in financial services 
during these negotiations, 53 countries met the original 
deadline of January 29, 1999, for completing domestic 
ratification procedures and notifying their acceptance of the 
1997 Agreement--the Fifth Protocol to the GATS. Another ten 
Members have completed these procedures since then, meaning 
that the number of countries whose 1997 commitments have 
entered into force stands at 63.
    The 1997 Financial Services Agreement opened would 
financial services markets to an unprecedented degree. Fifty-
two countries guaranteed broad market access terms across all 
insurance sectors-encompassing life, non-life, reinsurance, 
brokerage and auxiliary services. Another fourteen countries 
committed to open critical sub-sectors of their insurance 
markets of particular interest to U.S. industry. Fifty-nine 
countries committed to permit 100 percent foreign ownership of 
subsidiaries or branches in banking. And forty-four countries 
guaranteed to allow 100 percent foreign ownership of 
subsidiaries or branches in the securities sector.
    The United States has efforts underway as part of the 
current round of WTO/GATS negotiations to build upon the 
results of the 1997 negotiations. In December 2000, the United 
States submitted an initial financial services sectoral 
proposal to the GATS Council in Special Session as part of a 
package of U.S. sectoral proposals. Discussion of this and 
other proposals will continue in 2001.

Maritime Services

    With respect to maritime services, the United States (and 
most other countries) did not table an offer. The negotiations 
were suspended on June 28, 1996, without an agreement, and must 
be resumed in the context of the next GATS round. The United 
States continues to suspend its NTR obligations in this sector.

WTO ``Build-in-Agenda'' on Agriculture and Services

    The so-called built-in-agenda was an integral part of the 
Uruguay Round Agreements and constituted an important element 
in the balance of rights and obligations of the commitments of 
WTO members. The built-in agenda called for the resumption of 
negotiations by the year 2000 to further liberalize trade in 
agriculture and services, as well as the examination of 
government procurement practices and enforcement of 
intellectual property rights. The WTO Ministerial conference 
that was hosted by the United States in Seattle, Washington, 
from November 30 through December 4, 1999, was to have formally 
launched these negotiations.
    At the Seattle ministerial meeting, the key issue for 
member countries to consider was a frame work for a new round 
of multilateral trade negotiations. Representatives of the 135-
member countries of the WTO considered the procedures and 
substance of the built-in agenda, as well as other issues 
inducing transparency, possible reforms to the dispute 
settlement system, treatment of electronic commerce, and the 
accelerated Tariff Liberalization effort for industrial 
tariffs. Following four days of meetings, a decision was 
announced to suspend negotiations, with direction for member 
countries to engage in further consultations on how to proceed 
with a new round.
    New GATS negotiations began at the start of 2000 and aim to 
reduce or eliminate the adverse effects on trade in services of 
measures as a means of providing effective market access. The 
deadline for submission of negotiating and other proposals for 
new GATS discussions was set for December 2000 and in July 
2000, the United States presented a broad proposal. Services 
work is currently focused on addressing technical questions 
that in some cases are controversial, such as a review of 
possible disciplines in services for safeguard, subsidies, and 
government procurement. The procedural phase of the GATS talks 
is tentatively scheduled to conclude in March 2001, and this 
work on rules could eventually proceed in tandem with market 
access negotiations.
    Global agricultural talks were launched in March 2000. 
Central to these negotiations is whether and how to further 
reduce trade barriers and limit export and domestic subsidies. 
New issues such as the operations of state trading enterprises 
and trade in biotechnology products also seem likely to be 
brought to the negotiating table. A timetable for completing 
agricultural negotiations has not been set, and difficult 
issues which contributed to the failure of the Seattle 
ministerial will have to be addressed once again in these 
sectoral negotiations.

                    Specific Foreign Trade Barriers


       Sections 181 and 182 of the Trade Act of 1974, as amended

    Section 181 of the Trade Act of 1974,\31\ added by section 
303 of the Trade and Tariff Act of 1984 and amended by the 
Omnibus Trade and Competitiveness Act of 1988 and the Uruguay 
Round Agreements Act, requires an annual report on foreign 
trade barriers and their impact, known as the National Trade 
Estimates report. The USTR, through the interagency trade 
mechanism, must identify, analyze, and estimate the impact on 
U.S. commerce of foreign acts, policies, and practices which 
constitute significant barriers to or distortions of U.S. 
exports of goods or services and U.S. foreign direct 
investment. The report must also include information on any 
action taken (or reasons for no action taken) to eliminate any 
measure identified, as well as information with respect to 
section 301, negotiations or consultations with foreign 
governments, and foreign anticompetitive practices that 
adversely affect U.S. exports. The report is submitted to the 
appropriate committees of the House and to the Senate Committee 
on Finance. After submission of the report, the USTR must 
consult and take into account the views of these congressional 
committees.
---------------------------------------------------------------------------
    \31\ Public Law 93-618, 19 U.S.C. 2241.
---------------------------------------------------------------------------
    Section 182 of the Trade Act of 1974,\32\ as added by 
section 1303(b) of the 1988 Act and amended by the North 
American Free Trade Agreement Implementation Act and the 
Uruguay Round Agreements Act, requires the USTR to identify 
priority foreign countries that deny adequate and effective 
protection or fair and equitable market access for U.S. 
intellectual property rights, for purposes of action under 
section 301 (see further description under chapter 2).
---------------------------------------------------------------------------
    \32\ Public Law 93-618, 19 U.S.C. 2242.
---------------------------------------------------------------------------

                  Telecommunications Trade Act of 1988

    The Telecommunications Trade Act of 1988, under sections 
1371-1382 of the Omnibus Trade and Competitiveness Act of 1988 
and as amended by the Uruguay Round Agreements Act, provides 
specific trade negotiating authority and remedies to address 
the lack of foreign market openness in telecommunications 
trade. The Telecommunications Act requires the U.S. Trade 
Representative to investigate and designate foreign priority 
countries, taking into account acts, policies, and practices 
that deny mutually advantageous market opportunities to U.S. 
telecommunications exporters and their subsidiaries. Countries 
may be added or deleted from the list of designated countries 
at any time.
    The President is required to negotiate with the priority 
countries, drawing from a list of general and specific 
negotiating objectives, for the purpose of entering into 
bilateral or multilateral agreements that provide mutually 
advantageous market opportunities. If no agreement is reached, 
the Act requires the President to take whatever authorized 
actions are appropriate and most likely to achieve the general 
negotiating objectives, as defined by the specific objectives 
established by the President. The actions authorized are 
broadly similar to authorities available to the USTR under 
section 301 of the Trade Act of 1974, as amended.
    The Telecommunications Trade Act requires the USTR to 
conduct annual reviews to determine if a country has violated a 
telecommunications trade agreement or otherwise denies mutually 
advantageous market opportunities. In the case of an 
affirmative determination, it shall be treated as a trade 
agreement violation under section 301 of the Trade Act of 1974, 
as amended. In general, that section requires that in cases 
involving foreign violations of trade agreements or other 
``unjustifiable'' practices, the USTR must take retaliatory 
action in an amount equivalent in value to the foreign burden 
or restriction on U.S. commerce. Certain waivers are available 
to the USTR, under which no retaliation is required.
    Negotiating authority was provided concomitant with the 
general trade agreement authority provided in the Omnibus Trade 
and Competitiveness Act of 1988 (i.e., until its expiration in 
1993). Compensation authority also is provided, in the event 
that action is taken that violates U.S. obligations under the 
WTO.

Background and current status

    The Telecommunications Trade Act was intended to address 
the imbalance in market access for telecommunications goods and 
services between the United States and other countries that 
arose from increased deregulation of the U.S. market and court-
ordered divestiture by American Telephone and Telegraph (AT&T) 
of its local operating companies on January 1, 1984. These 
actions resulted in a U.S. market virtually devoid of barriers 
to the entry of foreign competitors. At the same time, however, 
major foreign markets were characterized by strict government 
regulations, procurement policies, standards, and other 
practices that resulted in limited competitive opportunities 
for U.S. and other foreign firms in those markets. Although the 
period authorized for telecommunications trade negotiations is 
coterminus with multilateral trade negotiating authority in the 
1988 Act, the separate negotiating authority is designed to 
permit increased flexibility in negotiating agreements in 
telecommunications trade. It permits the USTR to focus on 
priority countries whose barriers or practices pose the 
greatest impediment to market access by U.S. telecommunications 
firms and to tailor the negotiating priorities to address the 
specific circumstances in each country.
    In February 1989, the USTR (acting on behalf of the 
President) identified the European Community (EC) and Korea as 
priority foreign countries ``that deny U.S. telecommunications 
goods and services firms'' mutually advantageous market 
opportunites, based on information received during a 6-month 
consultation period with the private sector and Congress and 
initiated negotiations. The initial term for those negotiations 
was 18 months from the date of enactment (August 1988). At the 
end of the 18-month period in February 1990, the USTR extended 
the negotiations for an additional 1-year term, based on a 
finding that substantial progress had been made and that 
further progress was likely if the negotiations were continued. 
In February 1991, the USTR once again used the discretion 
provided in the Act to extend the negotiations with the EC and 
Korea for an additional year, on the basis of past and expected 
progress in the talks.
    The 1-year extension in 1991 was the last authorized under 
the Telecommunications Trade Act. The Act provides that if an 
agreement with each priority country which achieves the U.S. 
negotiating objectives was not reached by the end of that 1-
year period, the President must take ``whatever actions 
authorized . . . that are appropriate and most likely to 
achieve'' the negotiating objectives. In taking such action, 
the President is directed first to take those actions which 
most directly affect trade in telecommunications products and 
services of the priority foreign country, unless he determines 
that action against other economic sectors would be more 
effective in achieving the negotiating objectives.
    On February 21, 1992, the USTR announced that the United 
States and Korea had concluded the last of a series of 
agreements that would open access for competitive U.S. 
telecommunications goods and services providers in the Korean 
market on a fair and equitable basis. As a result, the 
President determined that Korea met the negotiating objectives 
set forth in section 1374 of the Omnibus Trade and 
Competitiveness Act of 1988 and no further action would be 
necessary. The annual review in 1993 of these agreements 
brought into question Korean compliance. After negotiations, 
Korea undertook in a clarifying letter to the United States a 
number of additional steps to ensure proper implementation of 
these agreements. On August 1, 1996, the USTR announced that 
changes in the Korean telecommunications market since 1992 have 
resulted in new barriers and identified Korea as a priority 
foreign country. The USTR stated that it would seek to 
negotiate an agreement with Korea to achieve U.S. objectives.
    While progress had been made with respect to the EC, 
several issues remained unresolved; in particular, the 
objective of securing nondiscriminatory access to EC 
government-owned telecommunications utilities for U.S. goods 
and services has not been met. Since the President specified 
action to address this issue under title VII of the 1988 Act 
(see description under Government Procurement), further action 
under section 1374 was not considered to be appropriate, 
thereby concluding this proceeding.
    In 1989, as part of the section 1377 review, USTR found 
Japan to be in violation of the Market-Oriented Sector-Specific 
(MOSS) Agreements in Telecommunications negotiated with Japan 
during the latter half of the 1980's. The MOSS Agreements 
consist of a series of commitments made by Japan concerning the 
regulation of and trade in telecommunications goods and 
services. As a result of the USTR finding and the ensuing 
initiation of retaliatory proceedings under section 1377(c), 
the United States and Japan reached the Third-Party Radio and 
Cellular Telephone Agreement in June 1989. The annual review of 
this agreement identified a potentially serious enforcement 
problem with cellular telephone provisions. U.S. meetings with 
Japan in the fall of 1993 failed to resolve this problem, and 
as a result, on February 15, 1994, the United States determined 
that Japan was not in compliance with the Agreement. Ensuring 
negotiations led to an agreement concluded on March 12, 1994 
which resolved U.S. concerns. On April 11, 1994, the government 
of Japan forwarded to USTR a deployment plan called for under 
the March 12 agreement. As a result, USTR terminated its 
affirmative determination under section 1377 on April 12.
    During the 1990 section 1377 review, the United States 
identified two MOSS Agreements compliance problems: provision 
of international value-added network services (IVANS) and 
foreign access to Japan's network channel terminating equipment 
(NCTE). Under the MOSS Agreements, the United States and Japan 
agreed in November 1988 on steps Japan would take to further 
liberalize its market for IVANS, resulting in the conclusion of 
an agreement on August 1, 1990. Subsequent agreements in 1991 
addressed technical concerns. Negotiations on NCTE issues 
resulted in the July 25, 1990 agreement that committed Japan to 
liberalize its NCTE market. The agreement provides for the non-
discriminatory treatment of foreign manufacturers in Japan and 
provides terms governing NCTE use with current and future 
services.
    As part of the United States-Japan Framework for a New 
Economic Partnership initiated July 10, 1993, the United States 
and Japan identified government procurement of 
telecommunications products and services as a priority area for 
negotiation. These negotiations and subsequent agreements are 
discussed in greater detail in the Government Procurement 
chapter of this book.
    Under the WTO basic telecommunications services agreement, 
interventions by U.S. officials on behalf of U.S. industry 
abroad, in instances where trading partners' WTO obligations 
are implicated, have increased and led in several instances to 
resolution of complaints without resort to investigations under 
section 1377. Notwithstanding this favorable trend, monitoring 
and enforcement activities under section 1377 have increased 
substantially given that, pursuant to the WTO basic 
telecommunications agreement, the number of trading partners 
subject to annual review under section 1377 includes the entire 
WTO membership.
    The 1998 section 1377 review focused on implementation of 
bilateral and WTO commitments by Taiwan, Canada, Japan, and 
Mexico. In each case, the U.S. earned new agreements or 
important satisfaction of U.S. industry concerns. With respect 
to Taiwan, U.S. carriers requested a review of Taiwan's 
compliance with a 1996 agreement on wireless U.S. carriers 
requested a review of Taiwan's compliance with a 1996 agreement 
on wireless services. They noted that interconnection rates 
charged by the dominant carrier Chunghwa Telecommunications Co. 
(CHT) were significantly above cost and posed a major 
competitive impediment in the wireless services market. These 
rates appeared inconsistent with the terms of the 1996 
agreement, which mandated cost-based interconnection rates. 
Based on this complaint, USTR negotiated an agreement, 
concluded on February 20, 1998, which required CHT to reduce 
its interconnection rates by almost 30 percent in 1998, and to 
ensure that these rates are completely cost-based by 2001.
    Canada and Mexico were also identified in 1998 as countries 
that appeared to be in violation of their commitments under the 
WTO. A Canadian regulatory proceeding has since eliminated the 
international bypass restriction that was the focus of U.S. 
industry's complaint. Despite bilateral discussions with Mexico 
in 1998 and 1999, several important issues regarding Mexico's 
implementation of its WTO telecom commitments remain under 
investigation, including Mexico's failure to produce lower net 
domestic interconnection costs for new entrants, and the 
question whether Telmex (the dominant Mexican carrier and 
former monopoly operator) is engaging in anti-competitive 
cross-subsidization of different telecom services. As a result, 
the out-of-cycle review on Mexico was extended for decision and 
in November 2000, the U.S. requested consultations as a first 
step toward the establishment of a WTO dispute settlement panel 
to examine Mexico's compliance of its telecommunications 
commitments.
    The 1999 section 1377 review focused on implementation of 
bilateral and WTO commitments by the European Community and 
Member States, Mexico, Germany and Japan. In each case, 
substantial progress was made in meeting the concerns of the 
U.S. industry. USTR's 1999 review of the European Community and 
Member States focused on the ``third generation'' (3G) mobile 
systems. Private sector and government representatives of the 
United States, Europe and other regions concluded in the 
International Telecommunications Union (ITU) in late-1999 a 
five-mode international recommendation for future 3G systems, 
which will allow all 3G systems to offer global roaming, high-
speed data and Internet access, full-motion video and other 
sophisticated multimedia services. However, certain decisions 
in Europe suggest a strategy to promote pan-European and global 
adoption of a system using only two of the five modes, which 
could disadvantage U.S. users as well as manufactures and 
service suppliers in the United States, European and third 
country markets. European Commission officials, in bilateral 
discussions and in responses to a series of U.S. letters 
expressing concern, have pledged repeatedly that EU Member 
States will not excluded the possibility of licensing use of 
the other three modes of the ITU recommendation. Most, if not 
all, EU Member States that have already instituted 
authorization systems for 3G services have hewed to this 
pledge.
    Japan came under close scrutiny in the 1377 review for 
over-priced interconnection rates that effectively prevent 
competition in Japan's local market, as well as for prohibiting 
the routing of both domestic and international traffic via 
combinations of owned and leased network facilities. Japan 
committed to address these issues in the context of the Second 
Joint Status Report under the Enhanced Initiative on 
Deregulation and Competition Policy released in May 1999.
    In 2000, out-of-cycle reviews were initiated under section 
1377 regarding compliance by Germany, Mexico, the United 
Kingdom, and South Africa. The review on Germany focused on 
continued excessive delays by Deutsche Telekom (``DT'') in 
providing interconnection to competing carriers; excessive 
license fees charged by the German government; and a refusal by 
DT to perform billing and collection services for new entrants 
absent a regulatory mandate. With respect to South Africa, the 
review focused on whether South Africa is failing to ensure 
that its dominant telecommunications supplier (``Telkom'') 
provide access to and use of the private lines needed for the 
competitive supply of value-added network services (``VANS'').

   Normal Trade Relations or Most-Favored-Nation (Nondiscriminatory) 
                               Treatment

    Nondiscriminatory treatment of trading partners has been a 
basic element of international trade for several centuries, 
although its scope, application, and terminology in U.S. law 
have changed as the complexity of trade among the nations has 
increased. Nondiscriminatory treatment and the principle 
underlying it are often referred to as the ``most-favored-
nation'' (MFN) treatment or principle. While the MFN principle 
remains firmly in place as a fundamental concept governing U.S. 
trade relations, the term ``most-favored-nation'' was recently 
replaced with the term ``normal trade relations'' in all U.S. 
trade laws and regulations.\33\ This was done to clear up 
confusion and more clearly reflect the principles of U.S. trade 
policy. In the following summary, the term ``MFN'' is retained 
to describe the international obligation, while ``NTR'' is used 
to describe U.S. law since 1998.
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    \33\ Public Law 105-206, approved July 22, 1998.
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    MFN had its orgins in international commercial agrements, 
whereby the signatories extend to each other treatment in trade 
matters which is no less favorable than that accorded to a 
nation which is the ``most favored'' in this respect. The 
effect of such treatment is that all countries to which it 
applies are ``the most favored'' ones; hence, all are treated 
equally. In the context of U.S. tariff legislation, NTR means 
that the products of a country given such treatment are subject 
to lower rates of duty (found in column 1 of the Harmonized 
Tariff Schedule (HTS) of the United States), which have 
resulted from various rounds of reciprocal tariff negotiations. 
Products from countries not eligible for NTR under U.S. law are 
subject to higher rates of duty (found in column 2 of the HTS), 
which are essentially the rates of duty enacted by the Tariff 
Act of 1930.
    Prior to 1934, the United States accorded MFN treatment to 
its trading partners reciprocally only within the scope of 
commercial agreements containing an MFN clause. Section 350 of 
the Tariff Act of 1930, as added by the Trade Agreements Act of 
1934, in effect required the nondiscriminatory application to 
all countries of tariff and trade concessions granted in 
bilateral agreements, whether or not those countries had 
agreements with the United States containing the MFN clause.
    By becoming a signatory of the General Agreement on Tariffs 
and Trade, the United States, as of January 1, 1948, also 
accepted the basic obligation of GATT Article I to accord 
unconditional MFN status to all other signatories. Thus, MFN or 
NTR status is extended by the United States to foreign 
countries as a matter not only of U.S. domestic law but also as 
an international obligation.
    The unconditional and unlimited MFN policy was changed 
after the enactment of section 5 of the Trade Agreements 
Extension Act of 1951,\34\ which directed the President to 
withdraw or suspend MFN status from the Soviet Union and all 
countries under the control of international communism. This 
action was prompted by the outbreak of the Korean War and the 
support that these countries were giving to North Korea and 
China. As implemented, this directive was applied to all then-
existing Communist countries except Yugoslavia.
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    \34\ Public Law 49-50, ch. 141, approved June 16, 1951.
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    In December 1960, President Eisenhower revoked the 
suspension of MFN status with respect to Poland. President 
Kennedy suspended MFN status with respect to Cuba in May 1962, 
pursuant to a new legislative requirement contained in section 
401 of the Tariff Classification Act of 1962.\35\ The Tariff 
Classification Act also enacted the new Tariff Schedules of the 
United States, which for the first time, included in a general 
headnote a current list of countries without MFN status. 
Section 231 of the Trade Expansion Act of 1962,\36\ as amended 
by section 402 of the Foreign Assistance Act of 1963, expanded 
the scope of the suspension of MFN status by applying it to 
``any country or area dominated by Communism,'' unless the 
President determined that the continued application of MFN 
status to Communist countries to which it was being applied at 
the time of the enactment of the Trade Expansion Act (i.e., to 
Poland and Yugoslavia) was in the national interest. The 
President made such a determination for both countries in March 
1964.
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    \35\ Public Law 87-566, approved May 24, 1962.
    \36\ Public Law 87-794, approved October 11, 1962, 19 U.S.C. 1351.
---------------------------------------------------------------------------
    The statutory provisions affecting the U.S. MFN policy and 
its practical implementation remained unchanged thereafter 
until enactment of the Trade Act of 1974. Subsequent amendments 
to U.S. MFN policy were made in the Customs and Trade Act of 
1990.\37\ As discussed above, ``MFN'' terminology was changed 
to ``NTR'' in all trade laws and regulations in the Internal 
Revenue Service Restructuring and Reform Act of 1997.\38\
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    \37\ Public Law 101-382, approved August 20, 1990.
    \38\ Public Law 105-206, approved July 22, 1998.
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The Normal Trade Relation or MFN principle under present law

    The basic statute currently in force with respect to the 
NTR treatment of U.S. trading partners is section 126 of the 
Trade Act of 1974.\39\ Section 126 contains the general 
requirement that any duty or other import restriction 
proclaimed to carry out any trade agreement applies on an MFN 
basis to products of all foreign countries, except as otherwise 
provided by law. The key provision embodying such exceptions 
with respect to tariff treatment is General Note 3(b) of the 
HTS, which contains the list of countries denied NTR tariff 
status with respect to their exports to the United States. (See 
list under chapter 1.) Section 1105(a) of the Omnibus Trade and 
Competitiveness Act of 1988 \40\ applies section 126(a) to 
trade agreements entered into under section 1102 of that Act, 
which includes the North American Free Trade Agreement and the 
Uruguay Round Agreements.
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    \39\ Public Law 93-618, 19 U.S.C. 2136.
    \40\ Public Law 100-418, 19 U.S.C. 2904.
---------------------------------------------------------------------------
    Other measures, most notably the Generalized System of 
Preferences, the Caribbean Basin Initiative, the African Growth 
and Opportunity Act, the Andean Initiative, the United States-
Israel Free Trade Area, the North American Free Trade 
Agreement, and tariff treatment of least developed developing 
countries, provide specifically for application of preferential 
duty treatment for eligible countries and products under 
certain circumstances. This preferential tariff status grants 
terms that are more favorable than those granted to other 
countries which otherwise receive NTR treatment from the United 
States. (See separate sections and chapter 1.)
    With respect to nontariff measures, section 1103(a) of the 
Omnibus Trade and Tariff Act of 1988 requires the President to 
recommend to the Congress that benefits and obligations of a 
particular agreement apply solely to the parties to that 
agreement or not apply uniformly to all parties, if such 
application is consistent with the Agreement. The Agreement on 
Subsidies and Countervailing Duties and the Agreement on 
Government Procurement, negotiated during the Tokyo Round of 
GATT multilateral trade negotiations, were implemented by the 
United States on a non-MFN basis. The Uruguay Round Agreement 
on Subsidies and Countervailing Measures now applies to all 
countries that become members of the World Trade Organization. 
The renegotiated GATT Government Procurement Agreement will 
continue to be implemented on a non-MFN basis.

Nonmarket economy countries

    The Trade Act of 1974 repealed section 231 of the Trade 
Expansion Act of 1962. Title IV of the Trade Act of 1974,\41\ 
as amended, presently regulates the extension of NTR tariff 
treatment to nonmarket economy countries. Section 401 directs 
the President to continue to deny NTR treatment to any country 
to which it was denied on the date of the enactment of the 
Trade Act (i.e., all Communist countries as of January 3, 1975, 
except Poland and Yugoslavia). Section 402 also denies NTR 
treatment (as well as access to U.S. government credits, or 
credit or investment guarantees) to any nonmarket economy 
country ineligible for NTR treatment on the date of enactment 
of the Trade Act and which the President determines denies or 
seriously restricts or burdens its citizen's right to emigrate.
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    \41\ Public Law 93-618, as amended by P.L. 96-39, P.L. 100-418, and 
P.L. 101-382, 19 U.S.C. 2431.
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    A country subject to the ban imposed by section 401 may 
gain NTR status only by fulfilling two basic conditions: (1) 
compliance with the requirements of the freedom of emigration 
provisions under section 402 of the Trade Act; and (2) 
conclusion of a bilateral commercial agreement with the United 
States under section 405 of the Trade Act providing reciprocal 
nondiscriminatory treatment.
    The provisions of section 402, commonly referred to as the 
Jackson-Vanik amendment, allow a non-NTR, nonmarket economy 
country to receive NTR status (and access to U.S. financial 
facilities) only if the President determines that it permits 
free and unrestricted emigration of its citizens. If the 
President determines that a country is in full compliance with 
the Jackson-Vanik freedom of emigration requirements, he must 
submit a report to the Congress by June 30 and December 31 of 
each year that such country receives NTR treatment, describing 
the nature of the country's emigration laws and policies. The 
country's NTR status may be revoked if a joint resolution 
disapproving the December 31 compliance report is enacted into 
law within 90 legislative days of the delivery of the report to 
Congress. If such a resolution is enacted, the country's NTR 
status is rescinded, effective 60 calendar days after 
enactment.
    Section 402 also authorizes the President to waive the 
requirements for full compliance of the particular country with 
the Jackson-Vanik requirements, if he determines that such 
waiver will substantially promote the objectives of the freedom 
of emigration provisions and if he has received assurances that 
the emigration practices of the country will lead substantially 
to the achievement of those objectives. The President may, at 
any time, terminate by executive order any waiver granted under 
authority of section 402.
    The President's waiver authority is subject to annual 
renewal. The renewal procedure under section 402(d)(1) requires 
the President, if he determines that waiver authority extension 
will substantially promote freedom of emigration objectives, to 
submit to the Congress a recommendation for a 12-month 
extension of the waiver authority within 30 days prior to its 
expiration (i.e., by June 3 each year), together with his 
reasons for the recommendation and a determination with respect 
to each country for which a waiver is in effect that the 
continuation of the waiver will substantially promote the 
freedom of emigration objectives.
    Under the terms of the 1974 Act, as amended, the extension 
of the waiver authority for an additional 12-month period is 
automatic unless a joint resolution disapproving such extension 
either generally or with respect to a specific country is 
enacted into law within 60 days after the expiration of the 
previous waiver authority. The enactment of such resolution 
would rescind the waiver authority (and with it the grant of 
the NTR status) with respect to countries covered by the 
resolution, effective 60 days after its enactment.
    Presidential authority to extend NTR status to a country 
excluded under section 401 may be utilized only as long as a 
bilateral commercial agreement between the United States and 
the country involved remains in force. Sections 404 and 405 of 
the Trade Act of 1974 as amended authorize the President to 
conclude such agreements, which must contain various 
provisions, including safeguards against disruptive imports, 
intellectual property rights, trade promotion, and 
consultations. Agreements and implementing proclamations can 
take effect only if a joint resolution of approval is enacted 
into law under the fast track procedures of section 151 of the 
Trade Act. Agreements may remain in force for no more than 3 
years, renewable for additional 3-year periods (without any 
congressional approval) if past operation has been found 
satisfactory.
    Current provisions providing for the use of joint 
resolutions to approve trade agreements with nonmarket economy 
countries and to disapprove presidential waivers and compliance 
reports were adopted as part of the Customs and Trade Act of 
1990. The amendments were made in response to a 1983 Supreme 
Court ruling in Immigration and Naturalization Service v. 
Chadha et al., which raised serious questions about the 
constitutionality of the use of concurrent or one-house 
resolutions for congressional approval and disapproval actions, 
as previously provided for in the Jackson-Vanik amendment. The 
court ruled that any action of a legislative nature must be 
taken by both houses of Congress and presented to the President 
for signature or veto.

Application of MFN/NTR treatment

    Presidential authority to waive the emigration requirements 
for extension of NTR treatment under title IV of the Trade Act 
of 1974 has been extended annually since 1976. Between 1976 and 
1989, the waiver authority and the authority to conclude 
bilateral trade agreements and grant MFN status was used only 
three times. MFN treatment was extended to Romania effective 
August 3, 1975; to Hungary effective July 7, 1978; and to the 
People's Republic of China effective February 1, 1980. Waivers 
were continued annually for all three countries and all three 
underlying bilateral agreements were extended, when 
appropriate, for additional 3-year periods by presidential 
determinations of their satisfactory operation.
    Although disapproval resolutions and alternative 
conditional NTR legislation were considered by the Congress, 
NTR treatment has continued uninterrupted for the People's 
Republic of China under annual renewals of the waiver 
authority.

People's Republic of China

    On June 3, 1999, the President announced his decision to 
waive for another year the freedom of emigration requirements 
in Title IV of the Trade Act of 1974 with respect to People's 
Republic of China, thereby granting normal trade relations 
(NTR) treatment China between July 1, 1999, and June 30, 2000. 
On May 15, 2000, Chairman Archer introduced H.R. 4444, to 
authorize extension of nondiscriminatory treatment (normal 
trade relations treatment) to the People's Republic of China. 
As introduced, the bill would grant the President the authority 
to determine that Title IV of the Trade Act should no longer 
apply to the People's Republic of China upon its accession to 
the WTO if he transmits a report to Congress certifying that 
the terms and conditions for accession of China to the WTO are 
at least equivalent to those agreed to in the November 15, 
1999, bilateral agreement between the United States and China.
    As amended by the Ways and Means Committee, H.R. 4444 
included a provision codifying the import surge mechanism 
negotiated as part of the 1999 U.S.-China bilateral agreement. 
Procedures for this new ``import surge mechanism'' are modeled 
after Section 406 of the Trade Act of 1974, as amended, with 
certain changes to conform to the requirements of the bilateral 
trade agreement. The legislation also: (1) establishes clear 
standards for the application of Presidential discretion in 
providing relief to injured industries and workers; (2) 
authorizes the President to provide a provisional safeguard in 
cases where ``delay would cause damage which it would be 
difficult to repair,'' as permitted under the United States-
China Agreement; and (3) implements a provision in the 
Agreement concerning trade diversion.
    When H.R. 4444 was considered in the House, the House 
adopted H. Res. 510, which provided for an amendment in the 
nature of a substitute to H.R. 4444. The amendment included the 
text of H.R. 4444, as reported from the Committee, and 
additional language establishing a Congressional-Executive 
Commission on China to focus on monitoring human rights, 
including internationally recognized core labor standards and 
religious freedom. The legislation also included provisions 
that: (1) require USTR to submit an annual report on China's 
compliance with WTO obligations; (2) provide that the United 
States will seek an annual review of China's compliance with 
its WTO obligations in the WTO as part of China's Protocol of 
Accession; (3) establish a task force on the prohibition on the 
importation of products of forced or prison labor; and (4) 
authorize additional resources for monitoring and enforcing 
China's compliance with trade agreements. The legislation also 
contains a sense of Congress that the accession of Taiwan and 
the People's Republic of China to the WTO should be considered 
at the same WTO General Council meeting. Finally, the 
legislation contains a number of other provisions not in the 
jurisdiction of the Committee, such as the authorization of 
funds to assist the development of rule of law and democracy in 
China. H.R. 4444, as amended, passed the House on June 24, 
2000, by a vote of 237-197. The bill was signed into law by the 
President on October 10, 2000 (Public Law 106-286). The Ways 
and Means Committee continues to monitor the progress China is 
making in negotiations to join the WTO, which have not 
concluded as of this printing.
    On June 2, 2000, the President announced his decision to 
waive for another year the freedom of emigration requirements 
in Title IV of the Trade Act of 1974 with respect to China, 
thereby granting China NTR status between July 1, 2000 and June 
30, 2001.

Romania

    In 1988, the President did not exercise the annual waiver 
authority with respect to Romania, issuing a proclamation on 
June 28, announcing his decision to allow the waiver to expire 
and to withdraw MFN treatment in response to the decision by 
the government of Romania to renounce the renewal of MFN 
subject to the terms of Jackson-Vanik. Romania's MFN status and 
its eligibility for U.S. government-supported export credits 
expired on July 3, 1988. On March 11, 1992, the Department of 
State issued a statement announcing that it had informed the 
Romanian government that the United States was prepared to sign 
a new bilateral trade agreement in light of Romania's progress 
toward democratic pluralism and a market economy and its desire 
for closer bilateral relations. The President issued a waiver 
from the freedom of emigration requirements for Romania on 
August 17, 1991, and signed a new bilateral trade agreement on 
April 3, 1992. However, in view of the concerns raised about 
the Romanian government's continued commitment to democratic 
reform, House consideration of H.J. Res. 512, approving the 
extension of MFN treatment to Romania, was defeated on 
September 30. H.J. Res. 228, approving the extension of MFN, 
was reintroduced on July 13, 1993. In recommending approval, 
the House Ways and Means Committee report noted that there had 
been substantial progress on democratization and human rights, 
and additional significant improvements had been made since 
1992. The resolution was subsequently passed by the House on 
October 12, and the Senate on October 21. H.J. Res. 228 was 
approved by the President and signed into law on November 2, 
1993.\42\
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    \42\ Public Law 103-133, approved November 2, 1993.
---------------------------------------------------------------------------
    Romania continued receiving MFN treatment under a 
presidential waiver from the Jackson-Vanik freedom of 
emigration criteria until the President found Romania to be in 
full compliance with those requirements on May 19, 1995. On 
March 26, 1996, H.R. 3161 was introduced to provide the 
President with the authority to determine that title IV should 
no longer apply with respect to Romania and to extend 
unconditional MFN status to that country. Upon recommending 
approval of the bill, the Committee noted that Romania is a 
member of the World Trade Organization (WTO) and that an 
extension of unconditional MFN is necessary in order for the 
United States to avail itself of all rights under the WTO with 
respect to Romania. H.R. 3161 passed the House on July 17, 1996 
and the Senate on July 19. The bill was signed into law by the 
President on August 3.\43\ On November 7, the President issued 
a proclamation removing the application of title IV from 
Romania and extending unconditional MFN treatment to the 
products of that country.
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    \43\ Public Law 104-171, approved August 3, 1996.
---------------------------------------------------------------------------

Hungary and the Czech Republic

    Since 1989, presidential authority under title IV has been 
used frequently, in response to the collapse of Communist 
domination in Eastern and Central Europe. On October 25, 1989, 
Hungary became the first country ever found in full compliance 
with the title IV freedom of emigration requirements, thereby 
becoming eligible for open-ended NTR status, as long as the 
trade agreement remained in force and Hungary remained in full 
compliance.
    On February 20, 1990, the President issued a waiver for 
Czechoslovakia, making that country eligible to receive U.S. 
government credits and credit and investment guarantees. 
Following congressional approval of a trade agreement, MFN 
treatment was extended to Czechoslovakia on November 17, 1990. 
The President continued the waiver on June 3, 1991, and then 
issued a determination on October 16 that Czechoslovakia's 
emigration policies met the Jackson-Vanik freedom of emigration 
requirements.
    Sections 1 and 2 of Public Law 102-182, signed on December 
4, 1991, provided for full normalization of MFN trading 
relations with both Hungary and Czechoslovakia, based on 
findings of their respect for fundamental human rights, 
policies of free emigration, and the political and economic 
reforms undertaken by both countries. Section 2 of that law 
authorized the President to terminate the application of title 
IV of the Trade Act of 1974 and extend MFN status to either or 
both Hungary and Czechoslovakia. Unconditional MFN treatment 
was granted to both countries in April 1992. Following the 
dissolution of Czechoslovakia in 1993, the independent 
countries of the Czech Republic and Slovakia retained their MFN 
status, having assumed the rights and obligations of the 
earlier agreement between the United States and Czechoslovakia.

German Democratic Republic (East Germany)

    Section 142 of the Customs and Trade Act of 1990 authorized 
the President to extend MFN treatment to the German Democratic 
Republic (East Germany), thus superseding the requirements of 
title IV, in light of the rapid progress then being made toward 
German reunification. However, the Congress expressed the 
strong view that such action should not be taken before MFN 
status was granted to Czechoslovakia under authority of title 
IV, since Czechoslovakia had followed all the procedures 
required by that title. The authority of section 142 was never 
used, however. The President issued a waiver for East Germany 
on August 15, 1990; that formerly independent country received 
MFN status on October 3, 1990 as part of a reunified Germany.

Former Soviet Union

    The Bush Administration entered into negotiations for a new 
bilateral trade agreement with the Soviet Union in response to 
the advent of ``perestroika'' and ``glasnost'' under the 
leadership of Soviet President Gorbachev, the subsequent 
collapse of communist regimes in Eastern and Central Europe, 
substantial increases in emigration rates, and to encourage 
further reforms. That agreement with its side letters was 
signed by Presidents Bush and Gorbachev on June 1, 1990. The 
President issued a waiver from the freedom of emigration 
requirements for the Soviet Union on December 29, 1990 and 
again on June 3, 1991. However, Soviet violence and economic 
sanctions against the independence movements in the Baltic 
states and Soviet republics resulted in delay of the submission 
of the Agreement to the Congress until August 2, 1991. 
Following independence of the Baltic states in September, the 
President resubmitted the trade agreement and presidential 
proclamation on October 9 and a new joint resolution was 
introduced omitting references to Estonia, Latvia, and 
Lithuania. The joint resolution approving the extension of MFN 
treatment to the products of the Soviet Union was passed by the 
Congress in November and signed into law on December 9, 
1991.\44\ Subsequently, bilateral trade agreements granting 
reciprocal MFN treatment have been signed with governments of 
the newly-independent republics of the former Soviet Union.\45\ 
No further congressional action is required as long as these 
agreements ratified by the republics reflect only technical 
changes in the previously approved original agreement signed by 
the former Soviet Union.
---------------------------------------------------------------------------
    \44\ Public Law 102-197.
    \45\ As of this writing, bilateral trade agreements have been 
signed and ratified and conditional NTR treatment granted to the 12 
republics of Russia, Ukraine, Kyrgyzstan, Moldova, Armenia, Belarus, 
Georgia, Kazakhstan, Tajikistan, Turkmenistan, and Uzbekistan, and 
Azerbaijan.
---------------------------------------------------------------------------
    Title IV of the Trade Act of 1974 applied to the Baltic 
states of Estonia, Latvia, and Lithuania by virtue of their 
forcible incorporation into the former Soviet Union. Following 
restoration of their independence from the Soviet Union on 
September 6, 1991, legislation \46\ extended MFN treatment to 
the products of the three Baltic states, notwithstanding title 
IV or any other provision of law and terminated the application 
of title IV to these countries.
---------------------------------------------------------------------------
    \46\ Public Law 102-182, title I, approved December 4, 1991.
---------------------------------------------------------------------------

Georgia

    Georgia first received conditional normal trade relations 
from the United States in 1992 under a Presidential waiver from 
the freedom of emigration requirements in the Jackson-Vanik 
amendment. In 1997, Georgia was found to be in full compliance 
with the Jackson-Vanik requirements, but its trade status 
remained subject to annual compliance reviews. On December 28, 
1998, the President submitted a report to Congress, as required 
by law, on the continued compliance of Georgia with the freedom 
of emigration requirements if the Jackson-Vanik amendment 
(House Document 106-5). The House received similar reports on 
July 2, 1999 (No House Document Number), on January 7, 2000 
(House Document 106-164), and on June 30, 2000 (House Document 
106-265).
    Public Law 106-476, signed into law on November 9, 2000, 
authorized the President to extend normal trade relations to 
Georgia.

Kyrgyzstan

    Kyrgyzstan first received conditional normal trade 
relations from the United States in 1992 under a Presidential 
waiver from the freedom of emigration requirements in the 
Jackson-Vanik amendment to the Trade Act of 1974. In 1997, 
Kyrgyzstan was found to be in full compliance with the Jackson-
Vanik requirements, but its trade status remained subject to 
annual complaiance reviews. On December 28, 1998, the President 
submitted a report to Congress, as required by law, on the 
continued compliance of Kyrgyzstan with the freedom of 
emigration requirements in the Jackson-Vanik amendment (House 
Document 106-5). Similar reports were submitted on July 2, 1999 
(No House Document Number) and on January 7, 2000 (House 
Document 106-104). Public Law 106-200, signed into law on May 
18, 2000, authorized the President to extend unconditional 
normal trade relations to Kyrgyzstan.

Moldova

    Moldova first received conditional normal trade relations 
from the United States in 1992 under a Presidential waiver from 
the freedom of emigration requirements in the Jackson-Vanik 
amendment to the Trade Act of 1974. In 1997, Moldova was found 
to be in full compliance with the Jackson-Vanik requirements, 
but its trade status remained subject to annual compliance 
reviews. On December 28, 1998, the President submitted a report 
to Congress, as required by law, on the continued compliance of 
Moldova with the freedom of emigration requirements in the 
Jackson-Vanik amendment (House Document 106-5). On July 2, 
1999, the President submitted a report to Congress, as required 
by law, on the continued compliance of Moldova with the freedom 
of emigration requirements in the Jackson-Vanik amendment (No 
House Document Number). On January 7 and June 30, 2000, the 
President submitted similar reports (House Documents) 106-164 
and 106-265).

Bulgaria and Mongolia

    The President issued a waiver from the freedom of 
emigration requirements for Bulgaria on January 22, 1991, and 
for Mongolia on January 23, 1991; the waivers were continued 
for both countries on June 3, 1991. Bilateral trade agreements 
providing MFN treatment for products of each of these two 
countries were submitted to the Congress on June 25, 1991. 
Joint resolutions approving the extension of MFN treatment to 
Bulgaria and Mongolia were passed by the Congress in October 
and signed by the President on November 13, 1991.\47\
---------------------------------------------------------------------------
    \47\ Public Law 102-157 and Public Law 102-158.
---------------------------------------------------------------------------
    Bulgaria continued to receive MFN treatment under a 
presidential waiver from the Jackson-Vanik freedom of 
emigration criteria until the President found the country to be 
in full compliance with the statutory requirements in June 
1993. On January 5, 1996, H.R. 2853 was introduced to provide 
the President with the authority to determine that title IV 
should no longer apply with respect to Bulgaria and to extend 
unconditional MFN status to the products of that country. In 
recommending approval of the bill, the Committee noted that 
Bulgaria was in the process of acceding to the WTO and that an 
extension of unconditional MFN would be necessary in order for 
the United States to avail itself of all rights under the WTO 
at the time of Bulgaria's accession. H.R. 2853 passed the House 
on March 5, 1996 and the Senate on June 28. The bill was signed 
into law by the President on July 18.\48\ On September 27, the 
President issued a proclamation effective October 1 removing 
the application of title IV from Bulgaria and extending 
unconditional MFN treatment to the products of that country.
---------------------------------------------------------------------------
    \48\ Public Law 104-162, approved July 18, 1996.
---------------------------------------------------------------------------

Mongolia

    In 1996, Mongolia was found to be in full compliance with 
the Jackson-Vanik requirements, but its trade status remained 
subject to annual compliance reviews. On February 11, 1999, the 
President submitted a report to Congress, as required by law, 
on the continued compliance of Mongolia with the freedom of 
emigration requirements in the Jackson-Vanik amendment (House 
Document 106-19). Public Law 106-36, signed into law on June 
25, 1999, authorized the President to determine that title IV 
of the Trade Act of 1974 (the Jackson-Vanik amendment) should 
no longer apply to Mongolia and to proclaim the extension of 
nondiscriminatory treatment (normal trade relations treatment) 
to that country.
    Prusuant to the provisions of Public Law 106-36, the 
President issued Proclamation 7207 on July 1, 1999, determining 
that title IV of the Trade Act of 1974 should no longer apply 
to Mongolia and declaring the extension of nondiscriminatory 
treatment to the products of that country.

Albania

    On May 14, 1992, a bilateral trade agreement was signed 
with Albania and a Presidential waiver was issued on May 20. A 
joint resolution approving the granting of MFN treatment to the 
products of Albania was enacted on August 26, 1992\49\ In 1997, 
Albania was found to be in full complaince with the Jackson-
Vanik requirements, but its trade status remained submject to 
annual compliance reviews for several years. On February 2, 
1999, the President submitted a report to Congress, as required 
by law, on the continued compliance of Albania with the freedom 
of emigration requirements in the Jackson-Vankik amendment 
(House Doucment 106-16). The President submitted a similar 
report on February 9, 2000 (House Document 106-195). Public Law 
106-200, signed into law on May 19, 2000, authroized the 
President to determine that the Jackson-Vanik amendment should 
no longer apply to Albania and to extend non-discriminatory 
(normal trade relations treatment) to Albania. Pursuant to the 
Provisions of Public Law 106-200, the President issued 
Proclamation 7326 on June 29, 2000 determining that title IV of 
the Trade Act of 1974 should no longer apply to Albania and 
declaring the extension of nondiscriminatory NTR treatment to 
the products of that country.
---------------------------------------------------------------------------
    \49\ Public Law 102-363.
---------------------------------------------------------------------------

Armenia

     Armenia first received conditional normal trade relations 
from the United States in 1992 under a Presidential waiver from 
the freedom of emigration requirements in Title IV of the Trade 
Act of 1974 (the Jackson-Vanik amendment). In 1997, Armenia was 
found to be in full compliance with the Jackson-Vanik 
requirements, but its trade status remained subject to annual 
compliance reviews. On December 28, 1998, the President 
submitted a report to Congress, as required by law, on the 
continued compliance of Armenia with the freedom of emigration 
requirements in the Jackson-Vanik amendment (House Document 
106-5). On July 2, 1999, the President submitted similar 
report. (No House Document Number). On January 7, and June 30, 
2000, the President submitted additional reports to Congress, 
as required by law, on the continued compliance of Armenia with 
the freedom of emigration requirements in the Jackson-Vanik 
amendment (House Documents 106-164 and 106-265).

Poland

    Poland is exempt from denial of MFN under title IV of the 
Trade Act, but its unconditional MFN status was suspended by 
presidential proclamation effective November 1, 1982, under the 
authority of section 125(d) of the Trade Act. On February 23, 
1987, President Reagan restored MFN status to Poland by 
presidential proclamation as part of the last stage of removing 
sanctions imposed on Poland in 1982 in response to its action 
against Solidarity. MFN status for Afghanistan was suspended by 
presidential proclamation effective February 14, 1986, under 
the authority provided by section 118 of the Continuing 
Appropriations Act for fiscal year 1986.\50\
---------------------------------------------------------------------------
    \50\ Public Law 99-190, approved December 19, 1985.
---------------------------------------------------------------------------

The former Yugoslavia

    The former Yugoslavia is also not subject to the provisions 
of title IV. In response to the armed conflict and atrocities 
in the former Yugoslavia, legislation was initiated and passed 
late in the 102nd Congress withdrawing MFN treatment from 
Serbia and Montenegro; the other four newly-independent 
republics of Bosnia-Hercegovina, Croatia, Macedonia, and 
Slovenia retain MFN status. The legislation authorizes the 
President to restore MFN status to these two republics if he 
certifies to the Congress that certain conditions are 
fulfilled.\51\
---------------------------------------------------------------------------
    \51\ Public Law 102-420, approved October 16, 1992.
---------------------------------------------------------------------------

Cambodia, Laos, and Vietnam

    Because of a peculiarity in the wording of the initial MFN 
status-suspending provision and its mandatory continuation by 
section 401, Cambodia's MFN status was not subject to the terms 
and conditions of the Jackson-Vanik amendment. Specifically, 
the original administrative suspension in 1951 and its 
enactment as part of the Trade Expansion Act of 1962 applied to 
``any part of Cambodia, Laos, or Vietnam which may be under 
Communist domination or control.'' This qualified application 
of the suspension, based on the actual situation in each 
country involved, was in effect at the time of enactment of 
section 401, which predated the compete Communist takeover of 
Cambodia in May 1975. The language of the provision was not 
changed until enactment of the Harmonized Tariff Schedule (HTS) 
in the Omnibus Trade and Competitiveness Act of 1988, which 
listed ``Kampuchea'' in General Note 3(b) among those countries 
whose products were denied MFN treatment. Upon the formation of 
the freely elected Royal Cambodian government in 1993, the 
United States and Cambodia negotiated an agreement on bilateral 
trade relations and intellectual property rights protection, 
calling for a reciprocal extension of MFN status. On May 16, 
1995, H.R. 1642 was introduced to amend the HTS by striking 
``Kampuchea'' to allow for an extension of unconditional MFN 
treatment to Cambodia upon the effective date of a Federal 
Register notice that a trade agreement obligating reciprocal 
MFN treatment had entered into force. The bill also required 
the President to report to Congress, no later than 18 months 
after the date of enactment, on trade relations between the 
United States and Cambodia under the bilateral agreement. H.R. 
1642 passed the House on July 11, 1996 and the Senate on July 
25. The bill was signed into law by the President on September 
25.\52\ As of October 25, the products of Cambodia were 
extended unconditional MFN treatment pursuant to a Federal 
Register notice published by the U.S. Trade Representative that 
a bilateral trade agreement between the United States and 
Cambodia was signed on October 4.
---------------------------------------------------------------------------
    \52\ Public Law 104-203, approved September 25, 1996.
---------------------------------------------------------------------------

Vietnam

    Vietnam first received a Presidential waiver in 1998 from 
the freedom of emigration requirements in the Jackson-Vanik 
amendment to the Trade Act of 1974. However, because the 
bilateral trade agreement between the United States has not 
been transmitted to and approved by Congress, Vietnam is 
ineligible under Title IV of the Trade Act of 1974 to receive 
normal trade relations from the United States. The practical 
effect of the Jackson-Vanik waiver is to make Vietnam eligible 
for certain U.S. government credits, or investment or credit 
guarantee programs, provided that Vietnam meets the relevant 
program criteria. These programs, which lie outside the 
jurisdiction of the Committee on Ways and Means, include the 
Oversease Private Investment Corporation, the Export-Import 
Bank, and agricultural credit programs administered by the U.S. 
Depertment of Agriculture.
    On June 3, 1999, the President transmitted a letter and 
report to Congress on the continuation of Vietnam's Jackson-
Vanik waiver for the next 12-month period (House Document 106-
78). The President issued the waiver on the basis that it would 
substantially promote achievement of the objectives in the 
statute.
    On June 2, 2000, the President transmitted another letter 
and report to Congress on the continuation of Vietnam's 
Jackson-Vanik waiver for an additional 12 month period (House 
Document 106-252). During the 106th Congress the House defeated 
two resolutions which would have disapproved Presidential 
waiver determinations for Vietnam.
    In July 2000, the United States and Vietnam signed a 
bilateral commercial agreement. Upon approval of the agreement 
by Congress, Vietnam would be eligible for conditional normal 
trade relations, subject to a yearly determination by the 
President.

                     North American Trade Relations

    Section 1102 of the Omnibus Trade and Competitiveness Act 
of 1988 \53\ authorized the President to enter into 
multilateral or bilateral trade agreements, before June 1, 1993 
(extended until April 15, 1994, only for the GATT Uruguay Round 
of Multilateral Trade Negotiations) to reduce or eliminate 
tariff or nontariff barriers and other trade-distorting 
measures, subject to congressional consultation requirements 
under sections 1102 and 1103 and approval of implementing 
legislation under special fast track procedural rules of the 
House and Senate under section 151 of the Trade Act of 1974. 
The authorities provided the means to achieve the negotiating 
objectives set forth under section 1101 of the 1988 Act.
---------------------------------------------------------------------------
    \53\ Public Law 100-418, approved August 23, 1988, 19 U.S.C. 2901 
note.
---------------------------------------------------------------------------
    On August 12, 1992, President Bush announced the completion 
of negotiations of a comprehensive North American Free Trade 
Agreement (NAFTA). On September 18, the President officially 
notified Congress of his intention to enter into the Agreement, 
accompanied by reports of 38 private sector advisory committees 
on the draft Agreement as required by section 135 of the Trade 
Act of 1974, as amended. This notice was followed on October 7 
by the initialling of the draft legal text by the trade 
ministers of the three participating countries in San Antonio, 
Texas. The Agreement was signed on December 17, the expiration 
of the 90-day minimum notice period.
    Also on December 17, President-elect Clinton stated that he 
could not support the NAFTA as negotiated without additional 
side agreements covering the environment, workers, and import 
surges. On August 13, 1993, U.S. Trade Representative Michael 
Kantor announced completion of these supplemental agreements. 
He also announced a basic agreement on a new institutional 
structure for funding environmental infrastructure projects in 
the U.S.-Mexico border region. The NAFTA side agreements were 
signed in a White House ceremony on September 14, 1993.
    On November 4, 1993, President Clinton sent two letters of 
transmittal to the Congress covering: (1) the NAFTA text, 
together with the draft implementing bill, Statement of 
Administrative Action and supporting documents as required 
under section 1103(a) of the 1988 Act for congressional 
approval; and (2) the NAFTA supplemental agreements.
    As provided under section 151 of the Trade Act of 1974, the 
implementing legislation was introduced as H.R. 3450 in the 
House and S. 1627 in the Senate on November 4. On November 17, 
the House passed H.R. 3450. On November 20, the Senate passed 
the bill. The bill was then signed by the President and became 
public law on December 8, 1993. On December 15, 1993, President 
Clinton issued Presidential Proclamation 6641 to implement as 
of January 1, 1994 the tariff modification provisions under the 
North American Free Trade Agreement as provided for under 
section 1102(a) of the 1988 Act.\54\
---------------------------------------------------------------------------
    \54\ Proclamation No. 6641, 58 Fed. Reg. 68,191 (1993).
---------------------------------------------------------------------------

                  North American Free Trade Agreement

    The North American Free Trade Agreement is the most 
comprehensive trade agreement ever negotiated and creates the 
world's largest market for goods and services.
    The cornerstone of the Agreement is the phased-out 
elimination of all tariffs on trade between the United States, 
Canada, and Mexico. With respect to United States-Canada 
bilateral trade, all tariffs will be eliminated by 1999, as was 
agreed in the United States-Canada Free-Trade Agreement. As for 
United States-Mexico bilateral trade, most tariffs will be 
eliminated by 2004, although a few U.S. tariffs on potentially 
import-sensitive items will not be completely eliminated until 
2009. The NAFTA also reduces or eliminates a number of 
nontariff barriers to trade, liberalizes restrictions on 
investment and services, sets forth strong and comprehensive 
rules on intellectual property, and extends to the three 
countries the international system established under the United 
States-Canada Free-Trade Agreement for review of national 
determinations of dumping and subsidy practices.

     North American Free Trade Agreement Implementation Act of 1993

    The North American Free Trade Agreement Implementation Act 
of 1993 \55\ approved the Agreement (but not the supplemental 
agreements) and Statement of Administrative Action submitted to 
the Congress on November 4, 1993 and includes provisions which 
are necessary or appropriate to implement the Agreement in U.S. 
domestic law. U.S. law prevails over the Agreement if there is 
a conflict. The Agreement establishes a federal-state 
consultation process concerning NAFTA obligations affecting 
state laws. The Act establishes a federal-state consultation 
process to achieve conformity of state laws with the Agreement. 
No person other than the United States has a cause of action or 
defense under the Agreement.
---------------------------------------------------------------------------
    \55\ Public Law 103-182, approved December 8, 1993, 19 U.S.C. 3301 
note.
---------------------------------------------------------------------------
    The President is authorized to proclaim the modifications 
in U.S. duties to implement the scheduled phaseout and 
elimination of all tariffs required under various provisions of 
the NAFTA and to maintain the general level of concessions. The 
rules of origin in the Act, which are to ensure application of 
NAFTA preferential tariff treatment only to goods originating 
in Mexico or Canada, are enacted in the statute. The 
legislation implements U.S. obligations under the NAFTA to 
eliminate customs merchandising processing fees, restrict duty 
drawback, and revise country-of-origin marking requirements; 
amends penalties and recordkeeping requirements to enforce 
NAFTA rules of origin and other customs requirements; and 
requires monitoring of television and color picture tube 
imports.
    The legislation also includes procedures and criteria for 
applying bilateral and global import relief measures on 
Canadian and Mexican articles; implements NAFTA obligations 
that apply to certain agricultural commodities, intellectual 
property rights protection, temporary entry of business 
persons, standards and sanitary and phytosanitary measures, and 
corporate average fuel economy; and authorizes the waiver of 
discriminatory government purchasing restrictions on NAFTA-
covered procurement.
    The legislation implements into U.S. domestic law the 
institutional provisions of the NAFTA establishing binational 
panel and extraordinary challenge committee review of final 
antidumping and countervailing duty determinations, in lieu of 
domestic judicial review, including procedures and criteria for 
the selection of panelists appointed by the United States, and 
special procedures for the selection of federal judges for 
panels and committees. Objectives for future negotiations with 
NAFTA countries on subsidies and special procedures for 
industries facing subsidized competition pending development of 
subsidy rules are also included.
    Institutional provisions include authorization of a U.S. 
section of the NAFTA Secretariat, requirements relating to 
selection of dispute settlement panelists, and a preliminary 
process for considering possible future country accession to 
NAFTA, subject to congressional approval.
    Other provisions include the establishment of a NAFTA 
transitional adjustment assistance program of comprehensive 
benefits, including training and income support, for workers 
who may be laid off due to increased U.S. imports from Mexico 
or Canada or a shift in production to Mexico or Canada, and 
authorizes state self-employment assistance programs. Also 
included are a comprehensive report by the President on the 
operation and economic impact of the NAFTA after 3 years, a 
response to actions affecting U.S. cultural industries, a 
report on the impact of the NAFTA on motor vehicle exports to 
Mexico, a response to discriminatory tax measures, and 
authorization of a Center for the Study of Western Hemisphere 
Trade.
    With respect to the supplemental agreements, the 
legislation authorized U.S. participation in, and 
appropriations for, the Commissions on Labor Cooperation, 
Environmental Cooperation, and Border Environment Cooperation. 
It also includes provisions relating to U.S. membership in the 
North American Development Bank.

                  United States-Israel Trade Relations

    Title IV of the Trade and Tariff Act of 1984 \56\ amended 
section 102(b) of the Trade Act of 1974 to authorize the 
President to enter into a bilateral reciprocal trade agreement 
with Israel specifically providing for elimination or reduction 
of U.S. duties on products of that country as well as nontariff 
barriers, subject to congressional consultations and approval 
of implementing legislation under the expedited procedures of 
sections 102 and 151-154 of the Trade Act. As amended by 
section 401, the requirements for advance consultations and 90-
day advance notice to Congress of intent to enter into a trade 
agreement did not apply to a bilateral agreement with Israel. 
Title IV also contains basic provisions of U.S. laws required 
to be applied to the administration of the Agreement.
---------------------------------------------------------------------------
    \56\ Public Law 98-573, title IV, approved October 30, 1984.
---------------------------------------------------------------------------
    On November 29, 1983, President Reagan and Israeli Prime 
Minister Shamir agreed to proceed with bilateral negotiations 
on a United States-Israel free trade area, which the Israeli 
government originally proposed in 1981. Negotiations by the 
U.S. Trade Representative began in mid-January 1984 on the 
elements of an agreement to eliminate tariffs and other trade-
distorting practices between the two countries. The Agreement 
on the Establishment of a Free Trade Area Between the 
government of the United States of America and the government 
of Israel was signed on April 22, 1985. The President 
transmitted to the Congress on April 29 the text of the 
Agreement, a draft implementing bill, a statement of 
administrative action, and an explanation of the effects on 
existing law. The United States-Israel Free Trade Area 
Implementation Act of 1985 \57\ approved the free trade area 
agreement with changes in U.S. laws necessary and appropriate 
for its domestic implementation. The implementing bill was 
passed by both Houses of Congress in May and signed into law on 
June 11, 1985.
---------------------------------------------------------------------------
    \57\ Public Law 99-47, approved June 11, 1985, 19 U.S.C. 2112.
---------------------------------------------------------------------------

              Title IV of the Trade and Tariff Act of 1984

    In addition to providing the basic authority for a 
bilateral free trade area agreement with Israel, title IV of 
the Trade and Tariff Act of 1984, as amended, sets forth the 
rule-of-origin requirements that would apply to such an 
agreement as well as the application of import relief laws.
    Section 402 requires that any trade agreement entered into 
under section 102(b) with Israel provide for the reduction or 
elimination of duties only on articles that meet rule-of-origin 
requirements similar to those under the Caribbean Basin 
Initiative (CBI):
          (1) The article must be the growth, product or 
        manufacture of Israel or foreign materials or 
        components must be substantially transformed into a new 
        or different article grown, produced, or manufactured 
        in Israel. Related provisions are designed to prevent 
        qualification of minor pass-through operations and 
        transshipments;
          (2) The article must be imported directly from Israel 
        into the U.S. customs territory; and
          (3) At least 35 percent of the total value of the 
        article must consist of materials produced in Israel 
        plus direct cost of processing operations performed in 
        Israel, of which 15 percent may be U.S. content.
    Sections 403 and 406 of the 1984 Act make clear that 
existing trade laws available to domestic industries for relief 
from injurious import competition or unfair trade practices 
continue to apply to imports under the trade agreement with 
Israel. As under the CBI legislation, the President may suspend 
the reduction or elimination of any duty under the trade 
agreement with Israel and proclaim a duty as import relief 
under section 203 of the Trade Act of 1974 or as a national 
security measure under section 232 of the Trade Expansion Act 
of 1962. Alternatively the President may establish a margin of 
preference or maintain the duty reduction or elimination on 
Israeli articles while imposing relief on imports from other 
sources. The U.S. International Trade Commission must state in 
its report to the President on import relief investigations 
involving Israeli articles covered in a trade agreement whether 
and to what extent its injury findings and recommended relief 
apply to imports from Israel.
    Section 404 of the Trade and Tariff Act of 1984 applies a 
special procedure similar to that established under the CBI 
whereby petitions may be filed with the Secretary of 
Agriculture for emergency relief on perishable products from 
Israel pending action on a petition filed for normal import 
relief action. The Secretary must determine and report to the 
President within 14 days a recommendation for emergency action 
if he has reason to believe an agricultural perishable product 
from Israel is being imported in such increased quantities as 
to be a substantial cause or threat of serious injury to the 
U.S. industry. The President must determine within 7 days 
whether to take emergency action, which consists of withdrawing 
the reduction or elimination of duty and restoring the original 
rate pending final action on the import relief petition.

             United States-Israel Free Trade Area Agreement

    The free trade area with Israel was the first such 
arrangement negotiated by the United States with any foreign 
country aside from the bilateral free trade arrangement with 
Canada in the automotive sector only. The Agreement is an 
adjunct to existing multilateral obligations of both parties 
under the GATT/WTO; existing rights and obligations between the 
countries under the GATT or other agreements continue to apply 
unless specifically modified by the terms of the Agreement.
    The main element of the Agreement is the reciprocal 
elimination of tariffs on all products traded between the two 
countries by January 1, 1995 and the elimination of other 
restrictive regulations of commerce on bilateral trade as 
provided under Article XXIV of the GATT 1994 for free trade 
areas. Duties were eliminated by both countries over 10 years 
in four staging categories depending on the relative import 
sensitivity of articles for domestic producers. Duties on 
certain products were eliminated immediately as of September 1, 
1985.
    The Agreement also prohibits the introduction of new duties 
or quantitative restrictions in bilateral trade unless they are 
permitted by the Agreement or by the GATT. The government of 
Israel undertook specific commitments concerning the reduction 
and elimination of its export subsidy programs and limited its 
GATT right as a developing country to apply duties to protect 
infant industries. Both parties must review their veterinary 
and plant health rules to insure nondiscrimination and not 
undue trade obstruction, undertook limitations on the duration 
of temporary restrictions that might be imposed in serious 
balance-of-payments situations, and reaffirmed existing 
bilateral obligations on intellectual property rights. The 
Agreement prohibits the imposition of import licensing 
requirements except in certain circumstances and of export or 
domestic purchase performance requirements on investment. The 
Agreement requires both countries to waive their Buy National 
restrictions on government procurement contracts valued $50,000 
or more for articles or services covered by the 1979 GATT 
Agreement on Government Procurement.
    The Agreement contains various safeguard provisions 
consistent with title IV of the Trade and Tariff Act of 1984 to 
permit import relief measures under certain circumstances, and 
rule-of-origin requirements to ensure that free trade area 
benefits accrue only to the two parties. Import restrictions 
other than customs duties may also be maintained based on 
agricultural policy considerations. A Joint Committee reviews 
and administers the Agreement and provides for dispute 
settlement.
    In 1996, the United States and Israel entered into the 
Agreement on Trade in Agricultural Products (ATAP), an adjunct 
to the 1985 FTA Agreement. The ATAP expires on December 31, 
2001.

    United States-Israel Free Trade Area Implementation Act of 1985

    The United States-Israel Free Trade Area Implementation Act 
of 1985 approved the United States-Israel Free Trade Area 
Agreement and statement of administrative action submitted to 
the Congress on April 29, 1985 and made necessary and 
appropriate changes in U.S. laws for its domestic 
implementation.\58\ U.S. statutes prevail if a provision of the 
Agreement is in conflict. No private rights of action or 
remedies are created. Expedited legislative approval procedures 
apply to subsequent changes in U.S. statutes to implement 
requirements, amendments, or recommendations under the 
Agreement.
---------------------------------------------------------------------------
    \58\ Public Law 99-47, approved June 11, 1985, 19 U.S.C. 2112 note.
---------------------------------------------------------------------------
    The President is authorized to proclaim the modifications 
or continuance of existing duties or duty-free treatment to 
implement the schedule for U.S. duty elimination under the 
Agreement. Tariff elimination was completed as of January 1, 
1995. The President may withdraw, suspend, or modify any duty 
or duty-free treatment or proclaim additional duties necessary 
to maintain the general level of concessions under the 
Agreement.
    The implementing legislation also amended title III of the 
Trade Agreements Act of 1979 to lower the threshold contract 
value to $50,000 or more on which the President may waive Buy 
American restrictions on eligible products or services from 
Israel covered by the GATT Agreement on Government Procurement. 
As amended by the Uruguay Round Agreements Act, the $50,000 
threshold may be applied to the broader central government 
entity coverage of goods and services under the 1994 GATT 
Agreement if there is a reciprocal agreement from Israel.

              West Bank and Gaza Strip Free Trade Benefits

    In an exchange of letters on October 17, 1995, among the 
United States, the government of Israel, and the Palestinian 
Authority, the U.S. Trade Representative agreed to seek 
statutory authority to proclaim elimination of existing duties 
on articles of the West Bank and Gaza Strip. The Palestinian 
Authority agreed to accord U.S. products duty-free access to 
the West Bank and Gaza Strip, to prevent illegal transshipment 
of goods not qualifying for duty-free access, and to support 
all efforts to end the Arab economic boycott of Israel. Because 
the authority given to the President to proclaim reductions in 
tariffs without congressional action contained in section 
1102(a) of the Omnibus Trade and Competitiveness Act of 1988 
had expired, new proclamation authority was required to 
implement the terms of the exchange of letters.
    Accordingly, Congress passed legislation amending the 
United States-Israel Free Trade Area Implementation Act of 
1985, adding a new section to provide the President 
proclamation authority to modify tariffs on products from the 
West Bank, Gaza Strip and qualifying industrial zones. \59\ The 
provision applies to areas designated as industrial parks 
between the Gaza Strip and Israel and between the West Bank and 
Israel. The effect of the provision is to offer to goods from 
the West Bank, Gaza Strip, and qualifying industrial zones 
(located between Israel and Jordan or Israel and Egypt) the 
same tariff treatment as is offered to Israel under the United 
States-Israel Free Trade Agreement. The provision applies the 
same rule-of-origin requirements as to products from the West 
Bank, Gaza Strip, and qualifying industrial zones as are 
already applicable to products from Israel.
---------------------------------------------------------------------------
    \59\ Public Law 104-234, approved October 2, 1996.
---------------------------------------------------------------------------

                  United States-Canada Trade Relations

    Section 102(b) of the Trade Act of 1974, as amended by 
section 401 of the Trade and Tariff Act of 1984, authorized the 
President to enter into bilateral reciprocal trade agreements 
with foreign countries to eliminate or reduce tariffs on 
bilateral trade as well as nontariff barriers if the following 
procedural requirements were met:
          (1) The foreign country requested the negotiation of 
        a bilateral trade agreement;
          (2) The President gave at least 60 days advance 
        notice of negotiations to the House Committee on Ways 
        and Means and the Senate Committee on Finance and 
        consulted with these committees regarding negotiation 
        of such an agreement; and
          (3) Neither Committee disapproved of the negotiation 
        of such an agreement before the end of that 60-day 
        period.
Agreements entered into under this authority were subject to 
further congressional consultation requirements and approval of 
implementing legislation under the expedited procedures of 
sections 102 and 151-154 of the Trade Act. This bilateral trade 
agreement authority expired on January 3, 1988.
    In March 1985, President Reagan and Prime Minister Mulroney 
directed their negotiators to explore ways to liberalize 
between the two countries. On September 26, Canadian Prime 
Minister Mulroney proposed bilateral trade negotiations on the 
``broadest possible package of mutually beneficial reductions 
in barriers to trade in goods and services.'' On December 10, 
President Reagan notified the House Committee on Ways and Means 
and the Senate Committee on Finance of the Administration's 
desire to enter into bilateral trade negotiations with Canada 
under the section 102 authority. On October 3, 1987, President 
Reagan submitted the 90-day advance notice to the Congress of 
his intention to enter into a trade agreement with Canada on 
January 2, 1988, the day before expiration of the authority, 
``contingent upon successful completion of the negotiations.'' 
On January 2, 1988, President Reagan and Prime Minister 
Mulroney signed the United States-Canada Free-Trade Agreement 
on behalf of their respective governments.
    On July 25, 1988, the President transmitted to the Congress 
a copy of the Agreement, a statement of administrative action, 
proposed implementing legislation, and a statement of how the 
Agreement serves the interests of U.S. commerce. The 
implementing legislation passed the House on August 9 and the 
Senate on September 19, and was signed into law by the 
President on September 28, 1988. The Agreement entered into 
force on January 1, 1989.
    On January 1, 1994, the North American Free Trade Agreement 
entered into force, covering trade among the United States, 
Canada, and Mexico. The Agreement contains provisions 
suspending the overlapping provisions of the two agreements 
until such time as Canada may terminate its participation in 
the NAFTA.

               United States-Canada Free-Trade Agreement

    The United States-Canada Free-Trade Agreement is one of the 
most comprehensive bilateral trade agreements ever negotiated 
and creates one of the world's largest internal markets for 
goods and services. The two federal governments agreed to 
ensure that state, provincial, and local governments take 
necessary actions in areas under their jurisdiction to 
implement the Agreement. Each party agreed to accord national 
interest treatment to the goods, services, and investment of 
the other party to the extent provided in the Agreement.
    The central provision of the Agreement is the phased out 
elimination of tariffs on all goods traded between the two 
countries within 10 years, by January 1, 1998, in three staging 
categories. Tariff elimination on particular products can be 
implemented faster than scheduled by mutual agreement. The 
Agreement contains rules of origin based primarily on changes 
in tariff classifications to determine that only products with 
sufficient content originating in either or both countries 
receive the benefits of preferential tariff treatment. Customs 
user fees and duty drawback programs must be phased out by 1994 
for bilateral trade; duty waivers linked to performance 
requirements, except certain waivers affecting automotive 
trade, and duty remission programs for autos must be terminated 
by 1988.
    The Agreement eliminates and prohibits import and export 
quotas or other restrictions, unless specifically permitted by 
the Agreement or by the General Agreement on Tariffs and Trade 
(GATT), and liberalizes or harmonizes laws and regulations 
relating to technical standards. Other Agreement provisions 
liberalize barriers affecting agriculture, automotive products, 
wine and distilled spirits, energy, government procurement, 
services, investment, temporary entry for business persons, and 
financial services. Certain ``cultural industries'' are exempt 
from the Agreement. Temporary import relief actions may be 
taken on a bilateral or global basis under certain 
circumstances to safeguard domestic industries from import-
related injury.
    Institutional provisions are included for the avoidance or 
settlement of disputes between the two parties concerning the 
interpretation or application of the Agreement. A major element 
of the Agreement is establishment of a mechanism for review by 
binational panels and extraordinary challenge committees of 
final antidumping and countervailing duty determinations on 
products of the two countries in lieu of judicial review by 
courts of either party using the request of either party.

  United States-Canada Free-Trade Agreement Implementation Act of 1988

    The United States-Canada Free-Trade Agreement 
Implementation Act of 1988 \60\ approved the Agreement and 
statement of administrative action submitted to the Congress on 
July 25, 1988 and sets forth the relationship between 
obligations under the Agreement and U.S. laws. The legislation 
also makes changes in U.S. laws necessary or appropriate to 
implement obligations under the Agreement, sets forth 
negotiating objectives and authorities for further U.S.-Canada 
trade liberalization, and specifies procedures for domestic 
implementation of future changes in the Agreement. Technical 
amendments to various provisions were included in the Customs 
and Trade Act of 1990.\61\
---------------------------------------------------------------------------
    \60\ Public Law 100-449, approved September 28, 1988, 19 U.S.C. 
2112 note.
    \61\ Public Law 101-382, approved August 20, 1990.
---------------------------------------------------------------------------
    U.S. laws prevail over the Agreement if there is a 
conflict. No person other than the United States has a cause of 
action or defense under the Agreement. Changes in U.S. law 
necessary or appropriate to implement an amendment to the 
Agreement could be approved under the fast track congressional 
procedures during the 30-month period after the Agreement 
entered into force. Certain actions may be implemented by 
presidential proclamation subject to prior consultation and 60 
calendar day congressional layover requirements.
    The President is authorized to proclaim the modifications 
in U.S. rates of duty necessary to implement the scheduled 
phaseout and elimination of all tariffs on trade with Canada 
within 10 years. The rules of origin set forth in the Agreement 
to ensure application of preferential tariff treatment only to 
goods originating in Canada are enacted in the statute. The 
legislation implements U.S. obligations under the Agreement to 
phase out customs user fees on Canadian goods, to eliminate 
drawback with certain exceptions, and to exempt Canada from the 
lottery ticket embargo; provides penalties and recordkeeping 
requirements to enforce the rules of origin; and includes a 
reporting and monitoring requirement on the consistency of 
Canadian production-based duty remission programs with the GATT 
and the Agreement.
    The legislation also implements in U.S. domestic law 
various provisions of the Agreement concerning particular 
economic sectors, including agricultural products (authority to 
impose temporary duties on imports of fresh fruits and 
vegetables, exemption of Canadian meat from any import 
limitations under the Meat Import Act (now repealed), authority 
to exempt grain and grain products and sugar-containing 
products from Canada from section 22 import quotas); exports to 
Canada of Alaskan oil; exemption of Canadian uranium from U.S. 
enrichment restrictions; a lower contract threshold ($25,000) 
for exemption from Buy American restrictions on government 
procurement of articles from Canada covered by the GATT 
Agreement on Government Procurement; temporary entry of 
business persons; and extension of financial services. The 
legislation also includes procedures and criteria for the 
application of bilateral or global safeguard measures on 
Canadian articles as temporary relief from import-related 
injury.
    The implementing legislation sets forth various U.S. 
negotiating objectives to expand the Agreement with respect to 
services, investment, intellectual property rights, automotive 
products, procurement, Canadian agricultural transportation 
subsidies, potato trade, and enforcement of U.S. rights against 
Canadian controls on fish. Objectives and authority to 
negotiate an agreement on subsidies and special procedures for 
industries facing subsidized competition pending development of 
subsidy rules are also included.
    The legislation also contains revisions to U.S. law to 
implement the institutional provisions of the Agreement 
establishing binational panel and extraordinary challenge 
committee review, upon request, of final antidumping and 
countervailing duty determinations, in lieu of judicial review. 
The statute includes procedures and criteria for the selection 
of the panelists appointed by the United States, establishes 
the U.S. Secretariat, and authorizes appropriations for 
administrative expenses.
    The NAFTA incorporates or otherwise carries forward most 
provisions of the United States-Canada FTA or supercedes the 
bilateral agreement in certain areas, such as rules of origin. 
The United States and Canada suspended the operation of the 
bilateral agreement upon entry into force of the NAFTA for the 
two countries for such time as the two governments remain 
parties to the NAFTA. As provided in section 107 of the NAFTA 
Implementation Act, certain provisions of the United States-
Canada FTA Implementation Act are suspended; other provisions 
of that Act which carry out U.S. obligations under the United 
States-Canada FTA that are in effect under the NAFTA remain in 
place or are amended by the NAFTA Implementation Act.


           Chapter 7: ORGANIZATION OF TRADE POLICY FUNCTIONS

                                Congress

    The role of the Congress in trade derives from its powers 
under the Constitution to regulate foreign commerce and to lay 
and collect duties (see preface). Consequently, the trade 
agreements program and application of duties or other import 
restrictions are based upon and limited to specific legislation 
or authorities delegated by the Congress. In order to ensure 
proper implementation of these laws and authorities, in 
accordance with legislative intent, Congress has included 
various statutory requirements in the trade laws to limit their 
application, to ensure congressional oversight of their 
implementation, and to fulfill its responsibility for 
legislating any necessary or appropriate changes in U.S. laws.
    More specifically, for example, periodic delegations of 
authority by the Congress to the President to proclaim changes 
in U.S. tariff treatment in the context of trade agreements has 
been limited in scope and periods of time, and use of the 
authority subject to certain prenegotiation procedures to 
protect domestic interests. On the other hand, Congress has 
granted federal agencies permanent authorities to administer 
certain laws and programs, such as trade remedy laws or trade 
adjustment assistance, under certain specific guidelines and 
subject to congressional oversight, including appropriations.
    Specific statutory roles of the Congress became formalized 
under the Trade Act of 1974 \1\ with the grant of authority to 
the President under section 102 to enter into reciprocal trade 
agreements affecting U.S. laws other than traditional changes 
in tariff treatment. In authorizing implementation through an 
expedited, no amendment procedure, Congress ensured its role 
through statutory consultation and notification procedures 
prior to submission of a draft implementing bill by the 
executive. This relationship continued under authorities 
granted by the Omnibus Trade and Competitiveness Act of 1988, 
but has now expired with respect to new agreements (see chapter 
6).
---------------------------------------------------------------------------
    \1\ Public Law 93-618, approved January 3, 1975, 19 U.S.C. 2101.
---------------------------------------------------------------------------
    Section 161 of the Trade Act of 1974 provides for 
appointment at the beginning of each session of Congress of 
five official congressional advisers by the Speaker of the 
House from the Committee on Ways and Means and five official 
advisers by the President of the Senate from the Committee on 
Finance, and additional advisers where appropriate for specific 
policy matters or negotiations, to U.S. delegations to 
international negotiating sessions on trade agreements. The 
U.S. Trade Representative (USTR) must keep each adviser and 
designated committee staff members informed of U.S. objectives 
and the status of negotiations and of any changes which may be 
recommended in U.S. laws. Section 162 requires transmission of 
any trade agreements to the Congress.
    Section 163 requires annual reports from the President and 
from the U.S. International Trade Commission (ITC) to keep the 
Congress informed regarding actions taken under the various 
trade laws and programs. Additional reports are required on 
specific aspects of various authorities (e.g., from the ITC on 
the domestic economic impact of the Caribbean Basin 
Initiative).
    Finally, Congress had maintained its institutional role 
with the executive by requiring the USTR to advise the Congress 
as well as the President on trade policy developments, through 
requests to the ITC for studies and analyses under section 332 
of the Tariff Act of 1930 of various current trade issues, and 
through its power to authorize and appropriate funds for the 
functions of major trade agencies.

                            Executive Branch


                       Interagency Trade Process

    Trade policy is a major element of U.S. economic and 
foreign policy. A decision to raise or lower tariffs, to impose 
import quotas, or to take other trade policy actions affects 
both domestic and foreign interests. In light of the far-
reaching effects of trade policy decisions, a large number of 
U.S. government agencies have a role to play in the development 
of policy. Various interagency coordinating mechanisms have 
been used for bringing together conflicting views and interests 
and resolving them so that there can be a consistent and 
balanced national trade policy.
    Until the late 1950s, the Department of State was the major 
initiator and coordinator of international trade policy. The 
Secretary of State chaired the interagency Trade Agreements 
Committee which originally included eight agencies: the 
Departments of State, Agriculture, Commerce, and Treasury, the 
Tariff Commission, the Agricultural Adjustment Administration, 
the National Recovery Administration, and the Office of the 
Special Advisor to the President on Foreign Trade.
    Congress authorized the President under section 242 of the 
Trade Expansion Act of 1962 \2\ to establish a new interagency 
trade organization to carry out specified trade policy 
functions. The Trade Agreements Committee was replaced by the 
Trade Policy Committee (TPC) in 1975.\3\ The TPC performs the 
same functions authorized by section 242 of the 1962 Trade Act. 
Two subordinate coordinating groups, the Trade Policy Review 
Group (TPRG) and the Trade Policy Staff Committee (TPSC), were 
subsequently created by the authority of the Special 
Representative.\4\
---------------------------------------------------------------------------
    \2\ 19 U.S.C. 1801.
    \3\ 40 Fed. Reg. 18419, April 28, 1975.
    \4\ Exec. Order 11846, March 27, 1975, 40 Fed. Reg. 14291.
---------------------------------------------------------------------------
    Section 1621 of the Omnibus Trade and Competitiveness Act 
of 1988 \5\ amended section 242 of the 1962 Act to provide that 
this interagency organization will include the USTR as chair, 
the Secretaries of Commerce, State, Treasury, Agriculture, and 
Labor, and authorizes the USTR to invite other agencies to 
attend meetings as appropriate. The functions of the 
organization are: to assist and make recommendations to the 
President in carrying out his functions under the trade laws 
and to advise the USTR in carrying out its functions; to assist 
the President and advise the USTR on the development and 
implementation of U.S. international trade policy objectives; 
and to advise the President and the USTR on the relationship 
between U.S. international trade policy objectives and other 
major policy areas.
---------------------------------------------------------------------------
    \5\ Public Law 100-418, section 1621, approved August 23, 1988.
---------------------------------------------------------------------------
    The TPSC is the working level interagency group, with 
members drawn from the office-director level of member 
agencies. Over 30 subcommittees and task forces support the 
work of the TPSC. In the absence of consensus at the TPSC level 
or in the case of particularly significant policy matters, 
issues are referred to the Assistant Secretary-level TPRG. 
Disagreements at the Assistant Secretary-level are referred to 
the TPC for Cabinet-level review. When presidential trade 
policy decisions are needed, the Chairman (USTR) submits the 
recommendations and advice of the Committee to the President.
    In 1993, President Clinton established the National 
Economic Council as the final tier of the interagency trade 
mechanism. Chaired by the President, the NEC is composed of the 
Vice President, the Secretaries of State, Treasury, 
Agriculture, Commerce, Labor, Housing and Urban Development, 
Transportation, and Energy, the Administrator of the 
Environmental Protection Agency, the Director of the Office of 
Management and Budget, the USTR, the Chairman of the Council of 
Economic Advisors, the National Security Advisor, and the 
Assistants to the President for Economic Policy, Domestic 
Policy and Science and Technology Policy.

                Office of the U.S. Trade Representative

    Section 241 of the Trade Expansion Act of 1962 established 
the Office of the Special Representative for Trade 
Negotiations.\6\ Congress' stated purpose for creating the 
position was to provide better balance between competing 
domestic and international interests in the formulation of U.S. 
trade policy and negotiations. The Special Trade Representative 
(STR), whose rank was ambassador extraordinary and 
plenipotentiary, was to serve as the chief U.S. representative 
for negotiations conducted under authority of the Act and for 
other trade negotiations authorized by the President.
---------------------------------------------------------------------------
    \6\ Public Law 87-794, approved October 11, 1962, 19 U.S.C. 1801.
---------------------------------------------------------------------------
    Various executive orders issued by President Kennedy in 
1963 established an Office of the Special Trade Representative 
and provided for the appointment of two Deputy Special 
Representatives for Trade Negotiations. These deputies, one 
based in Washington, D.C., and the other in Geneva, Switzerland 
(headquarters of the GATT Secretariat), were assigned major 
responsibilities for the conduct of the 1963-67 multilateral 
trade negotiations under the GATT, commonly known as the 
Kennedy Round.\7\
---------------------------------------------------------------------------
    \7\ Public Law 97-456, approved January 12, 1983, added a third 
deputy trade representative.
---------------------------------------------------------------------------
    Section 141 of the Trade Act of 1974 \8\ established the 
office as an agency within the executive office of the 
President and expanded the STR's duties to include 
responsibility for the trade agreements program under the 
Tariff Act of 1930, the Trade Expansion Act of 1962 and the 
Trade Act of 1974. Other duties and responsibilities also were 
assigned by the 1974 Trade Act and by Executive Order 11846 of 
March 27, 1975, as amended. Section 141 indicated Congressional 
intent to elevate the STR to Cabinet level by adding it to the 
list of positions at level I of the executive schedule of 
salaries, with the rank of ambassador. The STR was also made 
directly responsible to the President and the Congress.
---------------------------------------------------------------------------
    \8\ Public Law 93-618, approved January 3, 1975, 19 U.S.C. 2171.
---------------------------------------------------------------------------
    Reorganization Plan No. 3 of 1979, implemented by Executive 
Order 12188 of January 4, 1980,\9\ authorized certain changes 
in the trade responsibilities of the STR. Plan No. 3 
redesignated the Office of the Special Representative for Trade 
Negotiations as the Office of the United States Trade 
Representative (USTR). The new name reflected the plan's intent 
for the Trade Representative to have overall responsibility, on 
a permanent basis, for developing and coordinating the 
implementation of U.S. trade policy.
---------------------------------------------------------------------------
    \9\ 44 Fed. Reg. 69273.
---------------------------------------------------------------------------
    The 1979 Reorganization Plan specified that the USTR is the 
President's principal adviser and chief spokesman on trade, 
including advice on the impact of international trade on other 
U.S. government policies. The USTR also became Vice Chairman of 
the Overseas Private Investment Corporation (OPIC), a nonvoting 
member of the Export-Import Bank, and a member of the National 
Advisory Committee on International Monetary and Financial 
Policies. In addition to these responsibilities, section 306(c) 
of the Trade and Tariff Act of 1984 \10\ specified that the 
USTR, through the interagency organization, is responsible for 
developing and coordinating U.S. policies on trade in services.
---------------------------------------------------------------------------
    \10\ Public Law 98-573, approved October 30, 1984.
---------------------------------------------------------------------------
    Section 1601 of the Omnibus Trade and Competitiveness Act 
of 1988 \1\\1\ amended section 141 of the 1974 Act to the 
responsibilities of the USTR first enumerated under 
Reorganization Plan No. 3 and other statutes, as the following:
---------------------------------------------------------------------------
    \1\\1\ Public Law 100-418, section 1601, approved August 23, 1988.
---------------------------------------------------------------------------
          (1) to have primary responsibility for developing and 
        coordinating the implementation of U.S. international 
        trade policy;
          (2) to serve as the principal adviser to the 
        President on international trade policy and advise the 
        President on the impact of other U.S. government 
        policies on international trade;
          (3) to have lead responsibility for the conduct of, 
        and be chief U.S. representative for, international 
        trade negotiations, including commodity and direct 
        investment negotiations;
          (4) to coordinate trade policy with other agencies;
          (5) to act as the principal international trade 
        spokesman of the President;
          (6) to report to the President and the Congress on, 
        and be responsible to the President and the Congress 
        for, the administration of the trade agreements 
        program, including advising on nontariff barriers, 
        international commodity agreements, and other matters 
        relating to the trade agreements program; and
          (7) to be chairman of the Trade Policy Committee.
    In addition, the Omnibus Trade and Competitiveness Act also 
included the sense of Congress that the USTR be the senior 
representative on any body the President establishes to advise 
him on overall economic policies in which international trade 
matters predominate and that the USTR be included in all 
economic summits and other international meetings at which 
international trade is a major topic. The USTR was made 
responsible for identifying and coordinating agency resources 
on unfair trade practices cases that may be actionable under 
U.S. antidumping and countervailing duty statutes, section 337, 
or section 301. The Act established an unfair trade practices 
committee to advise the USTR.
    Under the Omnibus Trade and Competitiveness Act of 1988, 
the Congress further sought to elevate the importance of the 
USTR in trade matters by shifting to the USTR from the 
President responsibility for implementing actions under section 
301 of that Act, subject to the specific direction, if any, of 
the President.
    The Uruguay Round Agreements Act specifies that the USTR is 
to have lead responsibility for all negotiations on any matter 
considered under the auspices of the World Trade Organization.
    The Lobbying Disclosure Act of 1995 amended section 141 to 
prohibit the appointment of a person who has directly 
represented, aided, or advised a foreign entity (as defined by 
section 207(f)(3) of title 18, U.S. Code) in any trade 
negotiations, or trade dispute, with the United States as U.S. 
Trade Representative or Deputy U.S. Trade Representative.\12\
---------------------------------------------------------------------------
    \12\ Public Law 104-65, approved December 19, 1995.
---------------------------------------------------------------------------
    Section 406 of the Trade and Development Act of 2000 
(Public Law 106-200) amended the Trade Act of 1974 to establish 
the position of Chief Agriculture Negotiator within USTR, with 
the rank of Ambassador, to conduct trade negotiations and 
enforce trade agreements relating to U.S. agriculture products 
and services. Section 117 of that Act also established the 
position of Assistant USTR for African Affairs to direct and 
coordinate interagency activities on U.S.-Africa trade policy 
and investment matters.
    Section 141(g) of the Trade Act of 1974 provides for a 2-
year saauthorization of appropriations for USTR.

                         Department of Commerce

    The Department of Commerce was established in 1903 as the 
Department of Commerce and Labor.\13\ A 1913 act of Congress 
split the Department of Commerce and Labor into two separate 
departments.\14\ The mandate of the Commerce Department 
originally was to promote the foreign and domestic commerce of 
the United States. In subsequent years, its authority was 
extended to other areas bearing on the economic and 
technological development of the country. The titles of the 
component units of the Department indicate the diversity of the 
agency's current programs and services: Bureau of the Census; 
Bureau of Economic Analysis; Economic Development 
Administration; Bureau of Export Administration; International 
Trade Administration; Minority Business Development Agency; 
National Institute of Standards and Technology; National 
Oceanic and Atmospheric Administration; National Technical 
Information Service; National Telecommunications and 
Information Administration; Patent and Trademark Office; and 
U.S. Travel and Tourism Administration.
---------------------------------------------------------------------------
    \13\ 32 Stat. 827, 5 U.S.C. 591.
    \14\ 37 Stat. 736, 15 U.S.C. 1501.
---------------------------------------------------------------------------
    While most of these agencies have some responsibilities 
that affect U.S. trade, the U.S. Department of Commerce's major 
trade responsibilities are centered in the International Trade 
Administration and the Bureau of Export Administration.
    The International Trade Administration (ITA), which was 
established by the Secretary of Commerce on January 2, 
1980,\15\ administers many of the Department's international 
trade responsibilities and activities as prescribed by 
Reorganization Plan No. 3 of 1979. The plan provides that the 
Commerce Department has ``general operational responsibility 
for major nonagricultural international trade functions,'' as 
well as for any other functions assigned by law. Those include 
export development, commercial representation abroad, the 
administration of the antidumping and countervailing duty laws, 
export controls, trade adjustment assistance to firms, research 
and analysis, and compliance with international trade 
agreements to which the United States is a party.
---------------------------------------------------------------------------
    \15\ 45 Fed. Reg. 11862, as amended by 46 Fed. Reg. 13537.
---------------------------------------------------------------------------
    The Bureau of Export Administration (BXA) controls exports 
of commodities and technology for reasons of national security, 
foreign policy, and short supply. BXA issues export licenses in 
accordance with the export control regulations. Export control 
regulations are developed in consultation with other agencies, 
and some export license applications require interagency 
review.

                          U.S. Customs Service

    The second act of Congress, dated July 4, 1789, authorized 
the collection of duties on imported goods, wares and 
merchandise. The fifth act of Congress, passed in July 31, 
1789, established customs districts and authorized customs 
officers to collect import duties. On March 3, 1927, the Bureau 
of Customs was established as a separate agency under the 
Treasury Department.\16\ The Bureau was redesignated the United 
States Customs Service on August 1, 1973.\17\
---------------------------------------------------------------------------
    \16\ 44 Stat. 1381.
    \17\ Treasury Department Order 165-23, of April 4, 1973.
---------------------------------------------------------------------------
    The Customs Service collects import duties and enforces 
more than 400 laws or regulations relating to international 
trade. Among the many responsibilities falling to Customs are 
assessing and collecting duties, excise taxes, penalties and 
other fees due on imported goods; interdicting and seizing 
illegally entered merchandise; processing persons, carriers, 
cargo and mail into and out of the United States; helping 
enforce U.S. laws against the transfer of certain technologies 
to certain countries under export control authorities, laws on 
copyright, patent and trademark rights; and administering 
quotas and other import restrictions. The U.S. Customs Service 
maintains close ties with private business associations, 
international organizations, and foreign customs services.
    The Commissioner of Customs is appointed by the President 
and subject to confirmation by the Senate.
    The Customs Procedural Reform and Simplification Act of 
1978 provides for a 2-year authorization of appropriations for 
Customs.

                  U.S. International Trade Commission

    The U.S. International Trade Commission (ITC) is an 
independent and quasi-judicial agency that conducts studies, 
reports, and investigations, and makes recommendations to the 
President and the Congress on a wide range of international 
trade issues. The agency was established on September 8, 1916 
\18\ as the U.S. Tariff Commission. In 1974 the name was 
changed to the United States International Trade Commission by 
section 171 of the Trade Act of 1974.\19\
---------------------------------------------------------------------------
    \18\ 39 Stat. 795.
    \19\ 19 U.S.C. 2231.
---------------------------------------------------------------------------
    Commissioners are appointed by the President for 9-year 
terms, unless they are appointed to fill an unexpired term. Any 
Commissioner who has served for more than 5 years may not be 
reappointed. Of the six commissioners, not more than three may 
be of the same political party. The Chairman and Vice Chairman 
are designated by the President for 2-year terms, and 
successive Chairmen may not be of the same political party. 
After June 17, 1996, a Commissioner with less than 1 year of 
continuous service as a Commissioner may not be designated as 
Chairman.
    The Commission has numerous responsibilities for advice, 
investigations, studies, and data collection and analysis which 
may be grouped into the following general areas: advice on 
trade negotiations; Generalized System of Preferences; import 
relief for domestic industries; East-West trade; investigations 
of injury caused by subsidized or dumped goods; import 
interference with agricultural programs; unfair practices in 
import trade; development of uniform statistical data; matters 
related to the U.S. tariff schedules; international trade 
studies; trade and tariff summaries.
    Statutory authority for the Commission's responsibilities 
is provided primarily by the Tariff Act of 1930, the 
Agricultural Adjustment Act, the Trade Expansion Act of 1962, 
the Trade Act of 1974, the Trade Agreements Act of 1979, the 
Trade and Tariff Act of 1984, the Omnibus Trade and 
Competitiveness Act of 1988, and the Uruguay Round Agreements 
Act.
    The Tariff Act of 1930 gives the Commission broad authority 
to conduct studies and investigations relating to the impact of 
international trade on U.S. industries. Various sections under 
title VII of the Tariff Act authorize the Commission to 
determine whether U.S. industries are materially injured by 
imports which benefit from subsidies or are priced below fair 
value.\20\ If the Secretary of Commerce decides to suspend an 
antidumping or countervailing duty investigation upon reaching 
an agreement to eliminate the injury caused by the subsidized 
or dumped imports, the Commission is authorized to study 
whether or not the injury in fact is being eliminated. Section 
337 of the Tariff Act authorizes the ITC to investigate whether 
unfair methods of competition or unfair acts are being 
committed in the importation of goods into the United 
States.\21\ The Commission is authorized to order actions to 
remedy any such violations, subject to presidential 
disapproval.
---------------------------------------------------------------------------
    \20\ Sections 704, 734, and 751; 19 U.S.C. 1671c, 1673c, and 1675c.
    \21\ 19 U.S.C. 1337.
---------------------------------------------------------------------------
    Upon the request of the President, the House Committee on 
Ways and Means, the Senate Committee on Finance, or on its own 
motion, the ITC conducts studies and investigations under 
section 332 of the Tariff Act of 1930 on a wide range of trade-
related issues.\22\ Public reports generally are issued 
following such studies and investigations. The ITC also 
publishes summaries outlining the types of products entering 
the United States, their importance in U.S. consumption, 
production, and trade, and other relevant information. The ITC 
also is required to establish and maintain statistics on U.S. 
trade and to review the international commodity code for 
classifying products and reporting trade statistics among 
countries.\23\
---------------------------------------------------------------------------
    \22\ 19 U.S.C. 1332.
    \23\ 19 U.S.C. 1484(e).
---------------------------------------------------------------------------
    The Trade Expansion Act of 1962 and the Trade Act of 1974 
expanded the duties of the ITC. Both laws require the 
Commission to review developments within an industry receiving 
import protection and to advise the President on the probable 
impact of reducing or eliminating the protection.\24\
---------------------------------------------------------------------------
    \24\ 19 U.S.C. 1981, 2253.
---------------------------------------------------------------------------
    The Trade Act of 1974 gives the Commission a presidential 
advisory role on the probable domestic economic effects of 
trade concessions proposed during trade negotiations.\25\ The 
ITC performs a similar advisory role in relation to duty-free 
treatment under the Generalized System of Preferences.\26\ 
Under section 201 of the 1974 Trade Act,\27\ the Commission 
conducts investigations to determine whether increased imports 
are causing or threatening serious injury to the competing 
domestic industry and reports its findings and recommendations 
for relief to the President.
---------------------------------------------------------------------------
    \25\ 19 U.S.C. 2151.
    \26\ 19 U.S.C. 2151, 2163.
    \27\ 19 U.S.C. 2251.
---------------------------------------------------------------------------
    Sections 406 and 410 \28\ of the 1974 Trade Act provide for 
ITC monitoring and investigation of various aspects of trade 
with nonmarket economics.
---------------------------------------------------------------------------
    \28\ 19 U.S.C. 2240, 2436.
---------------------------------------------------------------------------
    Section 221 of the Trade and Tariff Act of 1984, amended by 
section 1614 of the Omnibus Trade and Competitiveness Act of 
1988, established a separate Trade Remedy Assistance Office 
within the ITC to provide information to the public on remedies 
and benefits available under U.S. trade laws and on the 
procedures and filing dates for relief petitions.
    Section 330(e)(2) of the Tariff Act of 1930 contains a 2-
year authorization of appropriations for the ITC.

              Private or Public Sector Advisory Committees

    The first formal mechanism providing for ongoing advice 
from the private sector on international trade matters was 
authorized by section 135 of the Trade Act of 1974.\29\ In view 
of the positive contribution of the advisory committees to the 
Tokyo Round of multilateral trade negotiations and to passage 
of the implementing legislation--the Trade Agreements Act of 
1979--Congress provided for continuation of the advisory 
committee structure in section 1631 of the Omnibus Trade and 
Competitiveness Act of 1988. Congress also expanded the 
committees' responsibilities by authorizing them to provide 
advice on the priorities and direction of U.S. trade policy, in 
addition to their previous responsibilities.
---------------------------------------------------------------------------
    \29\ 19 U.S.C. 2155.
---------------------------------------------------------------------------
    The U.S. Trade Representative manages the advisory 
committees in cooperation with the Departments of Agriculture, 
Commerce, Labor, and other departments. The committee structure 
is three-tiered, with the most senior level represented by the 
Advisory Committee for Trade Policy and Negotiations (ACTPN). 
The ACTPN is a 45-member body composed of presidential-
appointed representatives of government, labor, industry, 
agriculture, small business, service industries, retailers, 
consumer interests, and the general public. The group provides 
overall guidance on trade policy matters, including trade 
agreements and negotiations, and is chaired by a chairman 
elected by the committee. The group convenes at the call of the 
U.S. Trade Representative.
    The second tier is made up of policy advisory committees 
representing overall sectors of the economy (e.g., industry, 
agriculture, labor, services) whose role is to advise the 
government of the impact of various trade measures on their 
respective sectors.
    The third tier is composed of sector advisory committees 
consisting of experts from various fields. Their role is to 
provide specific, technical information and advice on trade 
issues involving their particular sector. Members of the second 
and third tier are appointed by the U.S. Trade Representative 
and the Secretary of the relevant department or agency.


              PART II: COMPILATION OF U.S. TRADE STATUTES

                              ----------                              


                   Chapter 8: TARIFF AND CUSTOMS LAWS

   A. IMPLEMENTATION OF THE HARMONIZED TARIFF SCHEDULE OF THE UNITED 
                                 STATES

   Title I, Subtitle B (Sections 1201-1217) of the Omnibus Trade and 
                      Competitiveness Act of 1988

   [19 U.S.C. 3001 et seq.; P.L. 100-418, as amended by P.L. 100-647]

SEC. 1201. PURPOSES.

  The purposes of this subtitle are--
          (1) to approve the International Convention on the 
        Harmonized Commodity Description and Coding System;
          (2) to implement in United States law the 
        nomenclature established internationally by the 
        Convention; and
          (3) to provide that the Convention shall be treated 
        as a trade agreement obligation of the United States.

SEC. 1202. DEFINITIONS.

  As used in this subtitle:
          (1) The term ``Commission'' means the United States 
        International Trade Commission.
          (2) The term ``Convention'' means the International 
        Convention on the Harmonized Commodity Description and 
        Coding System, done at Brussels on June 14, 1983, and 
        the Protocol thereto, done at Brussels on June 24, 
        1986, submitted to the Congress on June 15, 1987.
          (3) The term ``entered'' means entered, or withdrawn 
        from warehouse for consumption, in the customs 
        territory of the United States.
          (4) The term ``Federal agency'' means any 
        establishment in the executive branch of the United 
        States Government.
          (5) The term ``old Schedules'' means title I of the 
        Tariff Act of 1930 (19 U.S.C. 1202) as in effect on the 
        day before the effective date of the amendment to such 
        title under section 1204(a).
          (6) The term ``technical rectifications'' means 
        rectifications of an editorial character or minor 
        technical or clerical changes which do not affect the 
        substance or meaning of the text, such as--
                  (A) errors in spelling, numbering, or 
                punctuation;
                  (B) errors in indentation;
                  (C) errors (including inadvertent omissions) 
                in cross-references to headings or subheadings 
                or notes; and
                  (D) other clerical or typographical errors.

SEC. 1203. CONGRESSIONAL APPROVAL OF UNITED STATES ACCESSION TO THE 
                    CONVENTION.

  (a) Congressional Approval.--The Congress approves the 
accession by the United States of America to the Convention.
  (b) Acceptance of the Final Legal Text of the Convention by 
the President.--The President may accept for the United States 
the final legal instruments embodying the Convention. The 
President shall submit a copy of each final instrument to the 
Congress on the date it becomes available.
  (c) Unspecified Private Remedies Not Created.--Neither the 
entry into force with respect to the United States of the 
Convention nor the enactment of this subtitle may be construed 
as creating any private right of action or remedy for which 
provision is not explicitly made under this subtitle or under 
other laws of the United States.
  (d) Termination.--The provisions of section 125(a) of the 
Trade Act of 1974 (19 U.S.C. 2135(a)) do not apply to the 
Convention.

SEC. 1204. ENACTMENT OF THE HARMONIZED TARIFF SCHEDULE.

  (a) In General.--The Tariff Act of 1930 is amended by 
striking out title I and inserting a new title I entitled 
``Title I--Harmonized Tariff Schedule of the United States'' 
(hereinafter in this subtitle referred to as the ``Harmonized 
Tariff Schedule'') which--
          (1) consists of--
                  (A) the General Notes;
                  (B) the General Rules of Interpretation;
                  (C) the Additional U.S. Rules of 
                Interpretation;
                  (D) sections I to XXII, inclusive 
                (encompassing chapters 1 to 99, and including 
                all section and chapter notes, article 
                provisions, and tariff and other treatment 
                accorded thereto); and
                  (E) the Chemical Appendix to the Harmonized 
                Tariff Schedule;
        all conforming to the nomenclature of the Convention 
        and as set forth in Publication No. 2030 of the 
        Commission entitled ``Harmonized Tariff Schedule of the 
        United States Annotated for Statistical Reporting 
        Purposes'' and Supplement No. 1, thereto; but
          (2) does not include the statistical annotations, 
        notes, annexes, suffixes, check digits, units of 
        quantity, and other matters formulated under section 
        484(e) of the Tariff Act of 1930 (19 U.S.C. 1484(e)), 
        nor the table of contents, footnotes, index, and other 
        matters inserted for ease of reference, that are 
        included in such Publication No. 2030 or Supplement No. 
        1, thereto.
  (b) Modifications to the Harmonized Tariff Schedule.--At the 
earliest practicable date after the date of the enactment of 
the Omnibus Trade and Competitiveness Act of 1988, the 
President shall--
          (1) proclaim such modifications to the Harmonized 
        Tariff Schedule as are consistent with the standards 
        applied in converting the old Schedules into the format 
        of the Convention, as reflected in such Publication No. 
        2030 and Supplement No. 1, thereto, and as are 
        necessary or appropriate to implement--
                  (A) the future outstanding staged rate 
                reductions authorized by the Congress in--
                          (i) the Trade Act of 1974 (19 U.S.C. 
                        2101 et seq.) and the Trade Agreements 
                        Act of 1979 (19 U.S.C. 2501 et seq.) to 
                        reflect the tariff reductions that 
                        resulted from the Tokyo Round of 
                        multilateral trade negotiations, and
                          (ii) the United States-Israel Free 
                        Trade Area Implementation Act of 1985 
                        (19 U.S.C. 1202 note) to reflect the 
                        tariff reduction resulting from the 
                        United States-Israel Free Trade Area 
                        Agreement,
                  (B) the applicable provisions of--
                          (i) statutes enacted,
                          (ii) executive actions taken, and
                          (iii) final judicial decisions 
                        rendered,
                after January 1, 1988, and before the effective 
                date of the Harmonized Tariff Schedule, and
                  (C) such technical rectifications as the 
                President considers necessary; and
          (2) take such action as the President considers 
        necessary to bring trade agreements to which the United 
        States is a party into conformity with the Harmonized 
        Tariff Schedule.
  (c) Status of the Harmonized Tariff Schedule.--
          (1) The following shall be considered to be statutory 
        provisions of law for all purposes:
                  (A) The provisions of the Harmonized Tariff 
                Schedule as enacted by this subtitle.
                  (B) Each statutory amendment to the 
                Harmonized Tariff Schedule.
                  (C) Each modification or change made to the 
                Harmonized Tariff Schedule by the President 
                under authority of law (including section 604 
                of the Trade Act of 1974).
          (2) Neither the enactment of this subtitle nor the 
        subsequent enactment of any amendment to the Harmonized 
        Tariff Schedule, unless such subsequent enactment 
        otherwise provides, may be construed as limiting the 
        authority of the President--
                  (A) to effect the import treatment necessary 
                or appropriate to carry out, modify, withdraw, 
                suspend, or terminate, in whole or in part, 
                trade agreements; or
                  (B) to take such other actions through the 
                modification, continuance, or imposition of any 
                rate of duty or other import restriction as may 
                be necessary or appropriate under the authority 
                of the President.
          (3) If a rate of duty established in column 1 by the 
        President by proclamation or Executive order is higher 
        than the existing rate of duty in column 2, the 
        President may by proclamation or Executive order 
        increase such existing rate to the higher rate.
          (4) If a rate of duty is suspended or terminated by 
        the President by proclamation or Executive order and 
        the proclamation or Executive order does not specify 
        the rate that is to apply in lieu of the suspended or 
        terminated rate, the last rate of duty that applied 
        prior to the suspended or terminated rate shall be the 
        effective rate of duty.
  (d) Interim Informational Use of Harmonized Tariff Schedule 
Classifications.--Each--
          (1) proclamation issued by the President;
          (2) public notice issued by the Commission or other 
        Federal agency; and
          (3) finding, determination, order, recommendation, or 
        other decision made by the Commission or other Federal 
        agency;
during the period between the date of the enactment of the 
Omnibus Trade and Competitiveness Act of 1988 and the effective 
date of the Harmonized Tariff Schedule shall, if the 
proclamation, notice, or decision contains a reference to the 
tariff classification of any article, include, for 
informational purposes, a reference to the classification of 
that article under the Harmonized Tariff Schedule.

SEC. 1205. COMMISSION REVIEW OF, AND RECOMMENDATIONS REGARDING, THE 
                    HARMONIZED TARIFF SCHEDULE.

  (a) In General.--The Commission shall keep the Harmonized 
Tariff Schedule under continuous review and periodically, at 
such time as amendments to the Convention are recommended by 
the Customs Cooperation Council for adoption, and as other 
circumstances warrant, shall recommend to the President such 
modifications in the Harmonized Tariff Schedule as the 
Commission considers necessary or appropriate--
          (1) to conform the Harmonized Tariff Schedule with 
        amendments made to the Convention;
          (2) to promote the uniform application of the 
        Convention and particularly the Annex thereto;
          (3) to ensure that the Harmonized Tariff Schedule is 
        kept up-to-date in light of changes in technology or in 
        patterns of international trade;
          (4) to alleviate unnecessary administrative burdens; 
        and
          (5) to make technical rectifications.
  (b) Agency and Public Views Regarding Recommendations.--In 
formulating recommendations under subsection (a), the 
Commission shall solicit, and give consideration to, the views 
of interested Federal agencies and the public. For purposes of 
obtaining public views, the Commission--
          (1) shall give notice of the proposed recommendations 
        and afford reasonable opportunity for interested 
        parties to present their views in writing; and
          (2) may provide for a public hearing.
  (c) Submission of Recommendations.--The Commission shall 
submit recommendations under this section to the President in 
the form of a report that shall include a summary of the 
information on which the recommendations were based, together 
with a statement of the probable economic effect of each 
recommended change on any industry in the United States. The 
report also shall include a copy of all written views submitted 
by interested Federal agencies and a copy or summary, prepared 
by the Commission, of the views of all other interested 
parties.
  (d) Requirements Regarding Recommendations.--The Commission 
may not recommend any modification to the Harmonized Tariff 
Schedule unless the modification meets the following 
requirements:
          (1) The modification must--
                  (A) be consistent with the Convention or any 
                amendment thereto recommended for adoption;
                  (B) be consistent with sound nomenclature 
                principles; and
                  (C) ensure substantial rate neutrality.
          (2) Any change to a rate of duty must be consequent 
        to, or necessitated by, nomenclature modifications that 
        are recommended under this section.
          (3) The modification must not alter existing 
        conditions of competition for the affected United 
        States industry, labor, or trade.

SEC. 1206. PRESIDENTIAL ACTION ON COMMISSION RECOMMENDATIONS.

  (a) In General.--The President may proclaim modifications, 
based on the recommendations by the Commission under section 
1205, to the Harmonized Tariff Schedule if the President 
determines that the modifications--
          (1) are in conformity with United States obligations 
        under the Convention; and
          (2) do not run counter to the national economic 
        interest of the United States.
  (b) Lay-Over Period.--
          (1) The President may proclaim a modification under 
        subsection (a) only after the expiration of the 60-day 
        period beginning on the date on which the President 
        submits a report to the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate that sets forth the proposed 
        modification and the reasons therefor.
          (2) The 60-day period referred to in paragraph (1) 
        shall be computed by excluding--
                  (A) the days on which either House is not in 
                session because of an adjournment of more than 
                3 days to a day certain or an adjournment of 
                the Congress sine die; and
                  (B) any Saturday and Sunday, not excluded 
                under subparagraph (A), when either House is 
                not in session.
  (c) Effective Date of Modifications.--Modifications 
proclaimed by the President under subsection (a) may not take 
effect before the 15th day after the date on which the text of 
the proclamation is published in the Federal Register.

SEC. 1207. PUBLICATION OF THE HARMONIZED TARIFF SCHEDULE.

  (a) In General.--The Commission shall compile and publish, at 
appropriate intervals, and keep up to date the Harmonized 
Tariff Schedule and related information in the form of printed 
copy; and, if, in its judgment, such format would serve the 
public interest and convenience--
          (1) in the form of microfilm images; or
          (2) in the form of electronic media.
  (b) Content.--Publications under subsection (a), in whatever 
format, shall contain--
          (1) the then current Harmonized Tariff Schedule;
          (2) statistical annotations and related statistical 
        information formulated under section 484(e) of the 
        Tariff Act of 1930 (19 U.S.C. 1484(e)); and
          (3) such other matters as the Commission considers to 
        be necessary or appropriate to carry out the purposes 
        enumerated in the Preamble to the Convention.

SEC. 1208. IMPORT AND EXPORT STATISTICS.

  The Secretary of Commerce shall compile, and make publicly 
available, the import and export trade statistics of the United 
States. Such statistics shall be conformed to the nomenclature 
of the Convention.

SEC. 1209. COORDINATION OF TRADE POLICY AND THE CONVENTION.

  The United States Trade Representative is responsible for 
coordination of United States trade policy in relation to the 
Convention. Before formulating any United States position with 
respect to the Convention, including any proposed amendments 
thereto, the United States Trade Representative shall seek, and 
consider, information and advice from interested parties in the 
private sector (including a functional advisory committee) and 
from interested Federal agencies.

SEC. 1210. UNITED STATES PARTICIPATION ON THE CUSTOMS COOPERATION 
                    COUNCIL REGARDING THE CONVENTION.

  (a) Principal United States Agencies.--
          (1) Subject to the policy direction of the Office of 
        the United States Trade Representative under section 
        1209, the Department of the Treasury, the Department of 
        Commerce, and the Commission shall, with respect to the 
        activities of the Customs Cooperation Council relating 
        to the Convention--
                  (A) be primarily responsible for formulating 
                United States Government positions on technical 
                and procedural issues; and
                  (B) represent the United States Government.
          (2) The Department of Agriculture and other 
        interested Federal agencies shall provide to the 
        Department of the Treasury, the Department of Commerce, 
        and the Commission technical advice and assistance 
        relating to the functions referred to in paragraph (1).
  (b) Development of Technical Proposals.--
          (1) In connection with responsibilities arising from 
        the implementation of the Convention and under section 
        484(e) of the Tariff Act of 1930 (19 U.S.C. 1484(e)) 
        regarding United States programs for the development of 
        adequate and comparable statistical information on 
        merchandise trade, the Secretary of the Treasury, the 
        Secretary of Commerce, and the Commission shall prepare 
        technical proposals that are appropriate or required to 
        assure that the United States contribution to the 
        development of the Convention recognizes the needs of 
        the United States business community for a Convention 
        which reflects sound principles of commodity 
        identification, modern producing methods, and current 
        trading patterns and practices.
          (2) In carrying out this subsection, the Secretary of 
        the Treasury, the Secretary of Commerce, and the 
        Commission shall--
                  (A) solicit and consider the views of 
                interested parties in the private sector 
                (including a functional advisory committee) and 
                of interested Federal agencies;
                  (B) establish procedures for reviewing, and 
                developing appropriate responses to, inquiries 
                and complaints from interested parties 
                concerning articles produced in and exported 
                from the United States; and
                  (C) where appropriate, establish procedures 
                for--
                          (i) ensuring that the dispute 
                        settlement provisions and other 
                        relevant procedures available under the 
                        Convention are utilized to promote 
                        United States export interests, and
                          (ii) submitting classification 
                        questions to the Harmonized System 
                        Committee of the Customs Cooperation 
                        Council.
  (c) Availability of Customs Cooperation Council 
Publications.--As soon as practicable after the date of the 
enactment of the Omnibus Trade and Competitiveness Act of 1988, 
and periodically thereafter as appropriate, the Commission 
shall see to the publication of--
          (1) summary records of the Harmonized System 
        Committee of the Customs Cooperation Council; and
          (2) subject to applicable copyright laws, the 
        Explanatory Notes, Classification Opinions, and other 
        instruments of the Customs Cooperation Council relating 
        to the Convention.

SEC. 1211. TRANSITION TO THE HARMONIZED TARIFF SCHEDULE.

  (a) Existing Executive Actions.--
          (1) The appropriate officers of the United States 
        Government shall take whatever actions are necessary to 
        conform, to the fullest extent practicable, with the 
        tariff classification system of the Harmonized Tariff 
        Schedule all proclamations, regulations, rulings, 
        notices, findings, determinations, orders, 
        recommendations, and other written actions that--
                  (A) are in effect on the day before the 
                effective date of the Harmonized Tariff 
                Schedule; and
                  (B) contain references to the tariff 
                classification of articles under the old 
                Schedules.
          (2) Neither the repeal of the old Schedules, nor the 
        failure of any officer of the United States Government 
        to make the conforming changes required under paragraph 
        (1), shall affect to any extent the validity or effect 
        of the proclamation, regulation, ruling, notice, 
        finding, determination, order, recommendation, or other 
        action referred to in paragraph (1).
  (b) Generalized System of Preferences Conversion.--
          (1) The review of the proposed conversion of the 
        Generalized System of Preferences program to the 
        Convention tariff nomenclature, initiated by the Office 
        of the United States Trade Representative by notice 
        published in the Federal Register on December 8, 1986 
        (at page 44,163 of volume 51 thereof), shall be treated 
        as satisfying the requirements of sections 503(a) and 
        504(c)(3) of the Trade Act of 1974 (19 U.S.C. 2463(a), 
        2464(c)(3)).
          (2) In applying section 504(c)(1) of the Trade Act of 
        1974 (19 U.S.C. 2464(c)(1)) for calendar year 1989, the 
        reference in such section to July 1 shall be treated as 
        a reference to September 1.
  (c) Import Restrictions Under the Agricultural Adjustment 
Act.--
          (1) Whenever the President determines that the 
        conversion of an import restriction proclaimed under 
        section 22 of the Agricultural Adjustment Act (7 U.S.C. 
        624) from part 3 of the Appendix to the old Schedules 
        to subchapter IV of chapter 99 of the Harmonized Tariff 
        Schedule results in--
                  (A) an article that was previously subject to 
                the restriction being excluded from the 
                restriction; or
                  (B) an article not previously subject to the 
                restriction being included within the 
                restriction;
        the President may proclaim changes in subchapter IV of 
        chapter 99 of the Harmonized Tariff Schedule to conform 
        that subchapter to the fullest extent possible to part 
        3 of the Appendix to the old Schedules.
          (2) Whenever the President determines that the 
        conversion from headnote 2 of subpart A of part 10 of 
        schedule 1 of the old Schedules to Additional U.S. Note 
        2, chapter 17, of the Harmonized Tariff Schedule 
        results in--
                  (A) an article that was previously covered by 
                such headnote being excluded from coverage; or
                  (B) an article not previously covered by such 
                headnote being included in coverage;
        the President may proclaim changes in Additional U.S. 
        Note 2, chapter 17 of the Harmonized Tariff Schedule to 
        conform that note to the fullest extent possible to 
        headnote 2 of subpart A of part 10 of schedule 1 of the 
        old Schedules.
          (3) No change to the Harmonized Tariff Schedule may 
        be proclaimed under paragraph (1) or (2) after June 30, 
        1990.
  (d) Certain Protests and Petitions Under the Customs Law.--
          (1)(A) This subtitle may not be considered to divest 
        the courts of jurisdiction over--
                  (i) any protest filed under section 514 of 
                the Tariff Act of 1930 (19 U.S.C. 1514); or
                  (ii) any petition by an American 
                manufacturer, producer, or wholesaler under 
                section 516 of such Act (19 U.S.C. 1516);
        covering articles entered before the effective date of 
        the Harmonized Tariff Schedule.
          (B) Nothing in this subtitle shall affect the 
        jurisdiction of the courts with respect to articles 
        entered after the effective date of the Harmonized 
        Tariff Schedule.
          (2)(A) If any protest or petition referred to in 
        paragraph (1)(A) is sustained in whole or in part by a 
        final judicial decision, the entries subject to that 
        protest or petition and made before the effective date 
        of the Harmonized Tariff Schedule shall be liquidated 
        or reliquidated, as appropriate, in accordance with 
        such final judicial decision under the old Schedules.
          (B) At the earliest practicable date after the 
        effective date of the Harmonized Tariff Schedule, the 
        Commission shall initiate an investigation under 
        section 332 of the Tariff Act of 1930 (19 U.S.C. 1332) 
        of those final judicial decisions referred to in 
        subparagraph (A) that--
                  (i) are published during the 2-year period 
                beginning on February 1, 1988; and
                  (ii) would have affected tariff treatment if 
                they had been published during the period of 
                the conversion of the old Schedules into the 
                format of the Convention.
        No later than September 1, 1990, the Commission shall 
        report the results of the investigation to the 
        President, the Committee on Ways and Means, and the 
        Committee on Finance, and shall recommend those changes 
        to the Harmonized Tariff Schedule that the Commission 
        would have recommended if the final decisions concerned 
        had been made before the conversion into the format of 
        the Convention occurred.
          (3) The President shall review all changes 
        recommended by the Commission under paragraph (2)(B) 
        and shall, as soon as practicable, proclaim such of 
        those changes, if any, which he decides are necessary 
        or appropriate to conform such Schedule to the final 
        judicial decisions. Any such change shall be effective 
        with respect to--
                  (A) entries made on or after the date of such 
                proclamation; and
                  (B) entries made on or after the effective 
                date of the Harmonized Tariff Schedule if, 
                notwithstanding section 514 of the Tariff Act 
                of 1930 (19 U.S.C. 1514), application for 
                liquidation or reliquidation thereof is made by 
                the importer to the customs officer concerned 
                within 180 days after the effective date of 
                such proclamation.
          (4) If any protest or petition referred to in 
        paragraph (1)(A) is not sustained in whole or in part 
        by a final judicial decision, the entries subject to 
        that petition or protest and made before the effective 
        date of the Harmonized Tariff Schedule shall be 
        liquidated or reliquidated, as appropriate, in 
        accordance with the final judicial decision under the 
        old Schedules.

SEC. 1212. REFERENCE TO THE HARMONIZED TARIFF SCHEDULE.

  Any reference in any law to the ``Tariff Schedules of the 
United States'', ``the Tariff Schedules'', ``such Schedules'', 
and any other general reference that clearly refers to the old 
Schedules shall be treated as a reference to the Harmonized 
Tariff Schedule.

[SEC. 1213. TECHNICAL AMENDMENTS.]

[SEC. 1214. CONFORMING AMENDMENTS.

Amendments to codified titles, the Tobacco Adjustment Act of 
1983, the Federal Hazardous Substances Act, the Consumer 
Product Safety Act, the Toxic Substances Control Act, the 
Emergency Wetlands Resources Act of 1986, COBRA of 1985, the 
Tariff Act of 1930, the Automotive Products Trade Act of 1965, 
the Trade Act of 1974, the Trade Agreements Act of 1979, the 
Act of March 2, 1897, the Controlled Substances Import and 
Export Act, the Comprehensive Anti-Apartheid Act of 1986, the 
Strategic and Critical Materials Stock Piling Act, the Internal 
Revenue Code of 1986, the Caribbean Basin Economic Recovery 
Act, the Act Relating to Reforestation Trust Fund, the Trade 
and Tariff Act of 1984, the Meat Import Act of 1979, the 
National Wool Act of 1954, and the Agricultural Act of 1949.]

[SEC. 1215. NEGOTIATING AUTHORITY FOR CERTAIN ADP EQUIPMENT.

  Amendments to section 128(b) of the Trade Act of 1974 (19 
U.S.C. 2138(b))]

SEC. 1216. COMMISSION REPORT ON OPERATION OF SUBTITLE.

  The Commission, in consultation with other appropriate 
Federal agencies, shall prepare, and submit to the Congress and 
to the President, a report regarding the operation of this 
subtitle during the 12-month period commencing on the effective 
date of the Harmonized Tariff Schedule. The report shall be 
submitted to the Congress and to the President before the close 
of the 6-month period beginning on the day after the last day 
of such 12-month period.

SEC. 1217. EFFECTIVE DATES.

  (a) Accession to Convention and Provisions Other Than the 
Implementation of the Harmonized Tariff Schedule.--Except as 
provided in subsection (b), the provisions of this subtitle 
take effect on the date of the enactment of the Omnibus Trade 
and Competitiveness Act of 1988.
  (b) Implementation of the Harmonized Tariff Schedule.--The 
effective date of the Harmonized Tariff Schedule is January 1, 
1989. On such date--
          (1) the amendments made by sections 1204(a), 1213, 
        1214, and 1215 take effect and apply with respect to 
        articles entered on or after such date; and
          (2) sections 1204(c), 1211, and 1212 take effect.

          Section 484(e) of the Tariff Act of 1930, as amended

[19 U.S.C. 1484(e); P.L. 71-361, as amended by P.L. 93-618 and P.L. 95-
                                  106]

SEC. 484. ENTRY OF MERCHANDISE.

           *       *       *       *       *       *       *


    (e) Statistical Enumeration.--The Secretary of the 
Treasury, the Secretary of Commerce, and the United States 
International Trade Commission are authorized and directed to 
establish from time to time for statistical purposes an 
enumeration of articles in such detail as in their judgment may 
be necessary, comprehending all merchandise imported into the 
United States and exported from the United States, and shall 
seek, in conjunction with statistical programs for domestic 
production, and programs for achieving international 
harmonization of trade statistics, to establish the 
comparability thereof with such enumeration of articles. All 
import entries and export declarations shall include or have 
attached thereto an accurate statement specifying, in terms of 
such detailed enumeration, the kinds and quantities of all 
merchandise imported and exported and the value of the total 
quantity of each kind of 
article.

 B. EXCERPTS FROM THE HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES 
                (HTS) RELATING TO SPECIAL DUTY TREATMENT

            1. American Goods Returned (HTS Item 9801.00.10)

            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES

                              SUBCHAPTER I

ARTICLES EXPORTED AND RETURNED, NOT ADVANCED OR IMPROVED IN CONDITION; 
                     ANIMALS EXPORTED AND RETURNED

U.S. Notes
    1. The provisions in this subchapter (except subheadings 
9801.00.70 and 9801.00.80) shall not apply to any article:
          (a) Exported with benefit of drawback;
          (b) Of a kind with respect to the importation of 
        which an internal-revenue tax is imposed at the time 
        such article is entered, unless such article was 
        subject to an internal-revenue tax imposed upon 
        production or importation at the time of its 
        exportation from the United States and it shall be 
        proved that such tax was paid before exportation and 
        was not refunded; or
          (c) Manufactured or produced in the United States in 
        a customs bonded warehouse or under subheading 
        9813.00.05 and exported under any provision of law.

           *       *       *       *       *       *       *


--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
9801.00.10                 Products of the United      ..............  Free                        ..........................  .........................
                            States when returned
                            after having been
                            exported, without having
                            been advanced in value or
                            improved in condition by
                            any process of
                            manufacture or other
                            means while abroad.......
--------------------------------------------------------------------------------------------------------------------------------------------------------

  2. American Goods Repaired or Altered Abroad (HTS Items 9802.00.40, 
                                  .50)


     American Metal Articles Processed Abroad (HTS Item 9802.00.60)


       American Components Assembled Abroad (HTS Item 9802.00.80)


            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES


                             SUBCHAPTER II

      ARTICLES EXPORTED AND RETURNED, ADVANCED OR IMPROVED ABROAD

U.S. Notes

    1. Except for goods subject to NAFTA drawback, this 
subchapter shall not apply to any article exported:
          (a) From continuous customs custody with remission, 
        abatement or refund of duty;
          (b) With benefit of drawback;
          (c) To comply with any law of the United States or 
        regulation of any Federal agency requiring exportation; 
        or
          (d) After manufacture or production in the United 
        States under heading 9813.00.05.
    2. (a) Except as provided in paragraph (b), any product of 
the United States which is returned after having been advanced 
in value or improved in condition abroad by any process of 
manufacture or other means, or any imported article which has 
been assembled abroad in whole or in part of products of the 
United States, shall be treated for the purposes of this Act as 
a foreign article, and, if subject to a duty which is wholly or 
partly ad valorem, shall be dutiable, except as otherwise 
prescribed in this part, on its full value determined in 
accordance with section 402 of the Tariff Act of 1930, as 
amended. If such product or such article is dutiable at a rate 
dependent upon its value, the value for the purpose of 
determining the rate shall be its full value under the said 
section 402.
    (b) No article (except a textile article, apparel article, 
or petroleum, or any product derived from petroleum, provided 
for in heading 2709 or 2710) may be treated as a foreign 
article, or as subject to duty, if--
          (i) the article is--
                  (A) assembled or processed in whole of 
                fabricated components that are a product of the 
                United States, or
                  (B) processed in whole of ingredients (other 
                than water) that are a product of the United 
                States,
        in a beneficiary country; and
          (ii) neither the fabricated components, materials or 
        ingredients, after exportation from the United States, 
        nor the article itself, before importation into the 
        United States, enters the commerce of any foreign 
        country other than a beneficiary country.
As used in this paragraph, the term ``beneficiary country'' 
means a country listed in general note 7(a).
    3. Articles repaired, altered, processed or otherwise 
changed in condition abroad.--The following provisions apply 
only to subheadings 9802.00.40 through 9802.00.60, inclusive:
          (a) The value of repairs, alterations, processing or 
        other change in condition outside the United States 
        shall be:
                  (i) The cost to the importer of such change; 
                or
                  (ii) If no charge is made, the value of such 
                change,
        as set out in the invoice and entry papers; except 
        that, if the appraiser concludes that the amount so set 
        out does not represent a reasonable cost or value, then 
        the value of the change shall be determined in 
        accordance with section 402 of the Tariff Act of 1930, 
        as amended.
          (b) No appraisement of the imported article in its 
        changed condition shall be required unless necessary to 
        a determination of the rate or rates of duty applicable 
        to such article.
          (c) The duty, if any, upon the value of the change in 
        condition shall be at the rate which would apply to the 
        article itself, as an entirety without constructive 
        separation of its components, in its condition as 
        imported if it were not within the purview of this 
        subchapter. If the article, as returned to the United 
        States, is subject to a specific or compound rate of 
        duty, such rate shall be converted to the ad valorem 
        rate which when applied to the full value of such 
        article determined in accordance with said section 402 
        would provide the same amount of duties as the specific 
        or compound rate. In order to compute the duties due, 
        the ad valorem rate so obtained shall be applied to the 
        value of the change in condition made outside the 
        United States.
          (d) For purposes of subheading 9802.00.60, the term 
        ``metal'' covers (1) the base metals enumerated in 
        additional U.S. note 1 to section XV; (2) arsenic, 
        barium, boron, calcium, mercury, selenium, silicon, 
        strontium, tellurium, thorium, uranium and the rare-
        earth elements; and (3) alloys of any of the foregoing.
    4. Articles assembled abroad with components produced in 
the United States.--The following provisions apply only to 
subheading 9802.00.80 and 9802.00.90:
          (a) The value of the products of the United States 
        assembled into the imported article shall be:
                  (i) The cost of such products at the time of 
                the last purchase; or
                  (ii) If no charge is made, the value of such 
                products at the time of the shipment for 
                exportation,
        as set out in the invoice and entry papers; except 
        that, if the appraiser concludes that the amount so set 
        out does not represent a reasonable cost or value, then 
        the value of such products shall be determined in 
        accordance with section 402 of the Tariff Act of 1930, 
        as amended.
          (b) The duty, if any, on the imported article shall 
        be at the rate which would apply to the imported 
        article itself, as an entirety without constructive 
        separation of its components, in its condition as 
        imported if it were not within the purview of this 
        subchapter. If the imported article is subject to a 
        specific or compound rate of duty, the total duties 
        shall be reduced in such proportion as the cost or 
        value of such products of the United States bears to 
        the full value of the imported article.
    5. No imported article shall be accorded partial exemption 
from duty under more than one provision in this subchapter.
    6. Notwithstanding the partial exemption from ordinary 
customs duties on the value of the metal product exported from 
the United States provided under subheading 9802.00.60, 
articles imported under subheading 9802.00.60 are subject to 
all other duties, and any other restrictions or limitations, 
imposed pursuant to title VII of the Tariff Act of 1930 (19 
U.S.C. 1671 et seq.), or chapter 1 of title II or chapter 1 of 
title III of the Trade Act of 1974 (19 U.S.C. 2251 et seq., 19 
U.S.C. 2411 et seq.).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           Articles returned to the                    ..........................  ..........................  .........................
                            United States after
                            having been exported to
                            be advanced in value or
                            improved in condition by
                            any process of
                            manufacture or other
                            means:
                             Articles exported for                     ..........................  ..........................  .........................
                              repairs or alterations:
9802.00.40                    Repairs or alterations   ..............  A duty upon the value of    Free (B, C, CA, IL, MX)     A duty upon the value of
                               made pursuant to a                       the repairs or                                          the repairs or
                               warranty..............                   alterations (see U.S.                                   alterations (see U.S.
                                                                        note 3 of this                                          note 3 of this
                                                                        subchapter)                                             subchapter).
                   20 \1\      Internal combustion     (\1\).........  ..........................  ..........................  .........................
                                engines . . .
                                dutiable value.
                   40 \1\      Other . . . dutiable    (\1\).........  ..........................  ..........................  .........................
                                value.
9802.00.50                    Other..................  ..............  A duty upon the value of    Free (IL, MX).              A duty upon the value of
                                                                        the repairs or             A duty upon the value of     the repairs or
                                                                        alterations (see U.S.       the repairs or              alterations (see U.S.
                                                                        note 3 of this              alterations (see U.S.       note 3 of this
                                                                        subchapter)                 note 3 of this              subchapter).
                                                                                                    subchapter) (B, C, CA)
9802.00.60         00 \1\    Any article of metal (as  (\1\ \3\).....  A duty upon the value of    Free (IL).                  A duty upon the value of
                              defined in U.S. note                      such processing outside    A duty upon the value of     such processing outside
                              3(d) of this                              the United States (see      such processing outside     the United States (see
                              subchapter)                               U.S. note 3 of this         the United States (see      U.S. note 3 of this
                              manufactured in the                       subchapter)                 U.S. note 3 of this         subchapter).
                              United States or                                                      subchapter) (B, C, CA,
                              subjected to a process                                                MX)
                              of manufacture in the
                              United States, if
                              exported for further
                              processing, and if the
                              exported article as
                              processed outside the
                              United States, or the
                              article which results
                              from the processing
                              outside the United
                              States, is returned to
                              the United States for
                              further processing.....
9802.00.80                 Articles, except goods of   ..............  A duty upon the full value  Free (IL).                  A duty upon the full
                            heading 9802.00.90,                         of the imported article,   A duty upon the full value   value of the imported
                            assembled abroad in whole                   less the cost or value of   of the imported article,    article, less the cost
                            or in part of fabricated                    such products of the        less the cost or value of   or value of such
                            components, the product                     United States (see U.S.     such products of the        products of the United
                            of the United States,                       note 4 of this              United States (see U.S.     States (see U.S. note 4
                            which (a) were exported                     subchapter)                 note 4 of this              of this subchapter).
                            in condition ready for                                                  subchapter) (B, C, CA,
                            assembly without further                                                MX)
                            fabrication, (b) have not
                            lost their physical
                            identity in such articles
                            by change in form, shape
                            or otherwise, and (c)
                            have not been advanced in
                            value or improved in
                            condition abroad except
                            by being assembled and
                            except by operations
                            incidental to the
                            assembly process such as
                            cleaning, lubricating and
                            painting.................
--------------------------------------------------------------------------------------------------------------------------------------------------------

   3. Personal (Tourist) Exemptions (HTS Items 9804.00.65,   .70, .72)


            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES


                             SUBCHAPTER IV

       PERSONAL EXEMPTIONS EXTENDED TO RESIDENTS AND NONRESIDENTS

U.S. Notes

           *       *       *       *       *       *       *


    2. In the case of persons arriving from a contiguous 
country which maintains a free zone or free port, if the 
Secretary of the Treasury deems it necessary in the public 
interest and to facilitate enforcement of the requirement that 
the exemption in subheading 9804.00.70 shall apply only to 
articles acquired as an incident of the foreign journey, he 
shall prescribe by regulation or instruction, the application 
of which may be restricted to one or more ports of entry, that 
such exemption shall be allowed only to residents who have 
remained beyond the territorial limits of the United States for 
not less than a specified period, not to exceed 24 hours, and, 
after the expiration of 90 days after the date of such 
regulation or instruction, allowance of the said exemption 
shall be subject to the limitations so prescribed.
    3. A person arriving in the United States:
          (a) On duty as an employee of a vessel, vehicle or 
        aircraft, engaged in international traffic, or
          (b) From a trip during which he was so employed,
shall not be entitled to the exemptions provided for in this 
subchapter (other than those in heading 9804.00.80), unless he 
is permanently leaving such employment without the intention of 
resuming it on the same or another carrier.
    4. As used in subheadings 9804.00.70 and 9804.00.72, the 
term ``beneficiary country'' means a country listed in general 
notes 7(a) or 11(a).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           Articles imported by or                     ..........................  ..........................  .........................
                            for the account of any
                            person arriving in the
                            United States who is a
                            returning resident
                            thereof (including
                            American citizens who are
                            residents of American
                            Samoa, Guam or the Virgin
                            Islands of the United
                            States) (con.):
                             Other articles acquired                   ..........................  ..........................  .........................
                              abroad as an incident
                              of the journey from
                              which the person is
                              returning if such
                              person arrives from the
                              Virgin Islands of the
                              United States or from a
                              contiguous country
                              which maintains a free
                              zone or free port, or
                              arrives from any other
                              country after having
                              remained beyond the
                              United States for a
                              period of not less than
                              48 hours, for his
                              personal or household
                              use, but not imported
                              for the account of any
                              other person nor
                              intended for sale, if
                              declared in accordance
                              with regulations of the
                              Secretary of the
                              Treasury and if such
                              person has not claimed
                              an exemption under
                              subheadings 9804.00.65,
                              9804.00.70, and
                              9804.00.72 within 30
                              days preceding his
                              arrival, and claims
                              exemption under only
                              one of such items on
                              his arrival:
9804.00.65          (\1\)     Articles, accompanying   ..............  Free                                                    Free
                               a person, not over
                               $400, in aggregate
                               fair retail value in
                               the country of
                               acquisition, including
                               (but only in the case
                               of an individual who
                               has attained the age
                               of 21) not more than 1
                               liter of alcoholic
                               beverages and
                               including not more
                               than 200 cigarettes
                               and 100 cigars........
9804.00.70          (\1\)     Articles whether or not                  Free                                                    Free
                               accompanying a person,
                               not over $1,200 in
                               aggregate fair market
                               value in the country
                               of acquisition,
                               including:
                               (a) but only in the
                                case of an individual
                                who has attained the
                                age of 21, not more
                                than 5 liters of
                                alcoholic beverages,
                                not more than 1 liter
                                of which shall have
                                been acquired
                                elsewhere than in
                                American Samoa, Guam
                                or the Virgin Islands
                                of the United States,
                                and not more than 4
                                liters of which shall
                                have been produced
                                elsewhere than in
                                such insular
                                possessions, and
                               (b) not more than
                                1,000 cigarettes, not
                                more than 200 of
                                which shall have been
                                acquired elsewhere
                                than in such insular
                                possessions, and not
                                more than 100 cigars,
                              if such person arrives
                               directly or indirectly
                               from such insular
                               possessions, not more
                               than $400 of which
                               shall have been
                               acquired elsewhere
                               than in such insular
                               possessions or up to
                               $600 of which have
                               been acquired in one
                               or more beneficiary
                               countries (but this
                               subheading does not
                               permit the entry of
                               articles not
                               accompanying a person
                               which were acquired
                               elsewhere than in such
                               insular possessions)..
9804.00.72          (\1\)     Articles whether or not                  Free                                                    Free
                               accompanying a person,
                               not over $600 in
                               aggregate fair market
                               value in the country
                               of acquisition,
                               including--
                               (a) but only in the
                                case of an individual
                                who has attained the
                                age of 21, not more
                                than 1 liter of
                                alcoholic beverages
                                or not more than 2
                                liters if at least 1
                                liter is the product
                                of one or more
                                beneficiary
                                countries, and
                               (b) not more than 200
                                cigarettes, and not
                                more than 100 cigars,
                              if such person arrives
                               directly from a
                               beneficiary country,
                               not more than $400 of
                               which shall have been
                               acquired elsewhere
                               than in beneficiary
                               countries (but this
                               item does not permit
                               the entry of articles
                               not accompanying a
                               person which were
                               acquired elsewhere
                               than in beneficiary
                               countries)............
--------------------------------------------------------------------------------------------------------------------------------------------------------

  4. Noncommercial Importations of Limited Value (HTS Items 9816.00.20, 
                            and 9816.00.40)


            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES


                             SUBCHAPTER XVI

U.S. Note

    1. For the purposes of this subchapter the rates of duty 
for articles provided in this subchapter shall be assessed in 
lieu of any other rates of duty, except free rates of duty on 
such articles, unless the Secretary of the Treasury or his 
delegate determines, in accordance with regulations, that the 
application of the rate of duty provided in this subchapter to 
any article in lieu of the rate of duty otherwise applicable 
thereto adversely affects the economic interest of the United 
States.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           Articles for personal or
                            household use, or as bona
                            fide gifts, not imported
                            for the account of
                            another person, valued in
                            the aggregate at not over
                            $1,000 fair retail value
                            in the country of
                            acquisition, if the
                            person claiming the
                            benefit of subheading
                            9816.00.20 or 9816.00.40,
                            or both has not received
                            the benefits thereof
                            within the 30 days
                            immediately preceding his
                            arrival:.
9816.00.20            \1\  Accompanying a person,      ..............  (A) effective January 1,    Free (CA, IL) 3 percent of  10 percent of the fair
                            arriving in the United                      2000, 5 percent; (B)        the fair retail value       retail value
                            States (exclusive of duty-                  effective January 1,        (MX)
                            free articles and                           2001, 4 percent; (C)
                            articles acquired in                        effective January 1, 2002
                            American Samoa, Guam or                     3 percent.
                            the Virgin Islands of the
                            United States)...........
9816.00.40            \1\  Imported by or for the      ..............  (A) effective January 1,    Free (CA, IL) 1.5 percent   5 percent of the fair
                            account of a person                         2000, 3 percent; (B)        of the fair retail value    retail value
                            (whether or not                             effective January 1,        (MX)
                            accompanying him)                           2001, 2 percent;
                            arriving directly or                        effective January 1, 2002
                            indirectly from American                    1.5 percent.
                            Samoa, Guam or the Virgin
                            Islands of the United
                            States, acquired in such
                            insular possessions as an
                            incident of such person's
                            physical presence
--------------------------------------------------------------------------------------------------------------------------------------------------------

  5. Classification of Personal Effect of Participants in International 
                 Athletic Events (HTS Items 9817.60.00)


            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES


                            SUBCHAPTER XVII

U.S. Note

    6. Any article exempt from duty under heading 9817.60.00 
shall be free of taxes and fees that may otherwise be 
applicable, but shall not be free or otherwise exempt or 
excluded from routine or other inspections as may be required 
by the Customs Service.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Rates of duty
                                                                      ----------------------------------------------------------------------------------
    Heading/       Stat.       Article description        Units of                                1
   subheading      suffix                                 quantity    --------------------------------------------------------             2
                                                                                 General                     Special
--------------------------------------------------------------------------------------------------------------------------------------------------------
9817.60.00                 Any of the following
                            articles not intended for
                            sale of distribution to
                            the public: personal
                            effects of aliens who are
                            participants in,
                            officials of, or
                            accredited members of
                            delegations to, an
                            international athletic
                            event held in the United
                            States, such as the
                            Olympics and Paralympics,
                            the Goodwill Games, the
                            Special Olympics World
                            Games, the World Cup
                            Soccer Games, or any
                            similar international
                            athletic event as the
                            Secretary of the Treasury
                            may determine, and of
                            persons who are immediate
                            family members of or
                            servants to any of the
                            foregoing persons;
                            equipment and materials
                            imported in connection
                            with any such foregoing
                            event by or on behalf of
                            the foregoing persons or
                            the organizing committee
                            of such an event,
                            articles to be used in
                            exhibitions depicting the
                            culture of a country
                            participating in such an
                            event; and if consistent
                            with the foregoing, such
                            other articles as the
                            Secretary of the Treasury
                            may allow................
--------------------------------------------------------------------------------------------------------------------------------------------------------

                6. Products of U.S. Insular Possessions


                         General Note 3(a)(iv)


Products of Insular Possessions

    (A) Except as provided in additional U.S. note 5 of chapter 
91 and except as provided in additional U.S. note 2 of chapter 
96, and except as provided in section 423 of the Tax Reform Act 
of 1986, goods imported from insular possessions of the United 
States which are outside the customs territory of the United 
States are subject to the rates of duty set forth in column 1 
of the tariff schedule, except that all such goods the growth 
or product of any such possession, or manufactured or produced 
in any such possession from materials the growth, product or 
manufacture of any such possession or of the customs territory 
of the United States, or of both, which do not contain foreign 
materials to the value of more than 70 percent of their total 
value (or more than 50 percent of their total value with 
respect to goods described in section 213(b) of the Caribbean 
Basin Economic Recovery Act), coming to the customs territory 
of the United States directly from any such possession, and all 
goods previously imported into the customs territory of the 
United States with payment of all applicable duties and taxes 
imposed upon or by reason of importation which were shipped 
from the United States, without remission, refund or drawback 
of such duties or taxes, directly to the possession from which 
they are being returned by direct shipment, are exempt from 
duty.
    (B) In determining whether goods produced or manufactured 
in any such insular possession contain foreign materials to the 
value of more than 70 percent, no material shall be considered 
foreign which either--
          (1) at the time such goods are entered, or
          (2) at the time such material is imported into the 
        insular possession,
may be imported into the customs territory from a foreign 
country, and entered free of duty; except that no goods 
containing material to which (2) of this subparagraph applies 
shall be exempt from duty under subparagraph (A) unless 
adequate documentation is supplied to show that the material 
has been incorporated into such goods during the 18-month 
period after the date on which such material is imported into 
the insular possession.
    (C) Subject to the limitations imposed under subsections 
(a), (c), and (d) of section 503 of the Trade Act of 1974, 
goods designated as eligible under section 503 of such Act 
which are imported from an insular possession of the United 
States shall receive duty treatment no less favorable than the 
treatment afforded such goods imported from a beneficiary 
developing country under title V of such Act.
    (D) Subject to the provisions in section 213 of the 
Caribbean Basin Economic Recovery Act, goods which are imported 
from insular possessions of the United States shall receive 
duty treatment no less favorable than the treatment afforded 
such goods when they are imported from a beneficiary country 
under such Act.
    (E) Subject to the provisions in section 204 of the Andean 
Trade Preference Act, goods which are imported from insular 
possessions of the United States shall receive duty treatment 
no less favorable than the treatment afforded such goods when 
they are imported from a beneficiary country under such Act.
    (F) No quantity of an agricultural product that is subject 
to a tariff-rate quota that exceeds the in-quota quantity shall 
be eligible for duty-free treatment under this paragraph.

                 Additional U.S Note 3(a) to Chapter 71

    3.(a) Notwithstanding any provision in additional U.S. note 
5 to chapter 91, any article of jewelry provided for in heading 
7113 which is the product of the Virgin Islands, Guam, or 
American Samoa (including any such article which contains any 
foreign component) shall be eligible for the benefits provided 
in paragraph (h) of additional U.S. note 5 to chapter 91, 
subject to the provisions and limitations of that note and of 
paragraphs (b), (c), and (d) of this note.
    (b) Nothing in this note shall result in an increase or a 
decrease in the aggregate amount referred to in paragraph 
(b)(iii) of, or the quantitative limitation otherwise 
established pursuant to the requirements of, additional U.S. 
note 5 to chapter 91.
    (c) Nothing in this note shall be construed to permit a 
reduction in the amount available to watch producers under 
paragraph (h)(iv) of additional U.S. note 5 to chapter 91.
    (d) The Secretary of Commerce and the Secretary of the 
Interior shall issue such regulations, not inconsistent with 
the provisions of this note and additional U.S. note 5 to 
chapter 91, as the Secretaries determine necessary to carry out 
their respective duties under this note. Such regulations shall 
not be inconsistent with substantial transformation 
requirements but may define the circumstances under which 
articles of jewelry shall be deemed to be `units' for purposes 
of the benefits, provisions, and limitations of additional U.S. 
note 5 to Chapter 91.
    (e) Notwithstanding any other provision of law, during the 
2-year period beginning 45 days after the date of the enactment 
of this note, any article of jewelry provided for in heading 
7113 that is assembled in the Virgin Islands, Guam, or American 
Samoa shall be treated as a product of the Virgin Islands, 
Guam, or American Samoa for purposes of this note and General 
Note 3(a)(iv) of this Schedule.

               7. Rates of Duty on Certain Motor Vehicles


                           General Note 3(d)

   (d) Certain Motor Vehicles Manufactured in Foreign Trade 
Zones.
           (i)  Duty imposed.--Notwithstanding any other 
        provision of law, the duty imposed on a qualified 
        article shall be the amount determined by multiplying 
        the applicable foreign value content of such article by 
        the applicable rate of duty for such article.
           (ii) Qualified article.--For purposes of this 
        subdivision, the term ``qualified article'' means an 
        article that is--
                   (A) classifiable under any of subheadings 
                8702.10 through 8704.90 of the Harmonized 
                Tariff Schedule of the United States,
                   (B) produced or manufactured in a foreign 
                trade zone before January 1, 1996,
                   (C) exported therefrom to a NAFTA country 
                (as defined in section 2(4) of the North 
                American Free Trade Agreement Implementation 
                Act (19 U.S.C. 3301(4)), and
                   (D) subsequently imported from that NAFTA 
                country into the customs territory of the 
                United States--
                           (I) on or after the effective date 
                        of this subdivision, or
                           (II) on or after January 1, 1994, 
                        and before such effective date, if the 
                        entry of such article is unliquidated, 
                        under protest, or in litigation, or 
                        liquidation is otherwise not final on 
                        such effective date.
           (iii) Applicable foreign value content.
                   (A) Applicable foreign value content.--For 
                purposes of this subdivision, the term 
                ``applicable foreign value content'' means the 
                amount determined by multiplying the value of a 
                qualified article by the applicable percentage.
                   (B) Applicable percentage.--The term 
                ``applicable percentage'' means the FTZ 
                percentage for the article plus 5 percentage 
                points.
           (iv) Other definitions and special rules.--For 
        purposes of this subdivision--
                   (A) FTZ percentage.--The FTZ percentage for 
                a qualified article shall be the percentage 
                determined in accordance with subparagraph (I), 
                (II), or (III) of this paragraph, whichever is 
                applicable.
                           (I) Report for year published.--If, 
                        at the time a qualified article is 
                        entered, the FTZ Annual Report for the 
                        year in which the article was 
                        manufactured has been published, the 
                        FTZ percentage for the article shall be 
                        the percentage of foreign status 
                        merchandise set forth in that report 
                        for the subzone in which the qualified 
                        article was manufactured, or if not 
                        manufactured in a subzone, the foreign 
                        trade zone in which the qualified 
                        article was manufactured.
                           (II) Report for year not 
                        published.--If, at the time a qualified 
                        article is entered, the FTZ Annual 
                        Report for the year in which the 
                        article was manufactured has not been 
                        published, the FTZ percentage for the 
                        article shall be the percentage of 
                        foreign status merchandise set forth in 
                        the most recently published FTZ Annual 
                        Report for the subzone in which the 
                        article was manufactured, or if not 
                        manufactured in a subzone, the foreign 
                        trade zone in which the qualified 
                        article was manufactured.
                   (B) Applicable rate of duty.--The term 
                ``applicable duty rate'' means the rate of duty 
                set forth in any of subheadings 8702.10 through 
                8704.90 of the Harmonized Tariff Schedule of 
                the United States that is applicable to the 
                qualified article and which would apply to that 
                article if the article were directly entered 
                for consumption into the United States from the 
                foreign trade zone with non-privileged foreign 
                status having been claimed for all foreign 
                merchandise used in the manufacture or 
                production of the qualified article.
                   (C) Foreign trade zone; subzone.--The terms 
                ``foreign trade zone'' and ``subzone'' mean a 
                zone or subzone established pursuant to the Act 
                of June 18, 1934, commonly known as the Foreign 
                Trade Zones Act (19 U.S.C. 81a et seq.).
                   (D) FTZ annual report.--The term ``FTZ 
                Annual Report'' means the Annual Report to the 
                Congress published in accordance with section 
                16 of the Foreign Trade Zones Act (19 U.S.C. 
                81p(c)).
                   (E) Non-privileged foreign status.--The term 
                ``non-privileged foreign status'' means that 
                privilege has not been requested with respect 
                to an article pursuant to section 3 of the 
                Foreign Trade Zones Act.

                  C. GENERALIZED SYSTEM OF PREFERENCES


              Title V of the Trade Act of 1974, as amended


 [19 U.S.C. 2461 et seq.; P.L. 93-618, as amended by P.L. 94-455, P.L. 
96-39, P.L. 98-573, P.L. 99-47, P.L. 99-514, P.L. 99-570, P.L. 100-418, 
 P.L. 101-179, P.L. 101-382, P.L. 103-66, P.L. 103-465, P.L. 104-188, 
       P.L. 104-295, P.L. 106-36, P.L. 106-170, and P.L. 106-200]

SEC. 501. AUTHORITY TO EXTEND PREFERENCES.

  The President may provide duty-free treatment for any 
eligible article from any beneficiary developing country in 
accordance with the provisions of this title. In taking any 
such action, the President shall have due regard for--
          (1) the effect such action will have on furthering 
        the economic development of developing countries 
        through the expansion of their exports;
          (2) the extent to which other major developed 
        countries are undertaking a comparable effort to assist 
        developing countries by granting generalized 
        preferences with respect to imports of products of such 
        countries;
          (3) the anticipated impact of such action on United 
        States producers of like or directly competitive 
        products; and
          (4) the extent of the beneficiary developing 
        country's competitiveness with respect to eligible 
        articles.

SEC. 502. DESIGNATION OF BENEFICIARY DEVELOPING COUNTRIES.

  (a) Authority To Designate Countries.--
          (1) Beneficiary developing countries.--The President 
        is authorized to designate countries as beneficiary 
        developing countries for purposes of this title.
          (2) Least-developed beneficiary developing 
        countries.--The President is authorized to designate 
        any beneficiary developing country as a least-developed 
        beneficiary developing country for purposes of this 
        title, based on the considerations in section 501 and 
        subsection (c) of this section.
  (b) Countries Ineligible for Designation.--
          (1) Specific countries.--The following countries may 
        not be designated as beneficiary developing countries 
        for purposes of this title:
                  (A) Australia.
                  (B) Canada.
                  (C) European Union member states.
                  (D) Iceland.
                  (E) Japan.
                  (F) Monaco.
                  (G) New Zealand.
                  (H) Norway.
                  (I) Switzerland.
          (2) Other bases for ineligibility.--The President 
        shall not designate any country a beneficiary 
        developing country under this title if any of the 
        following applies:
                  (A) Such country is a Communist country, 
                unless--
                          (i) the products of such country 
                        receive nondiscriminatory treatment,
                          (ii) such country is a WTO Member (as 
                        such term is defined in section 2(10) 
                        of the Uruguay Round Agreements Act) 
                        (19 U.S.C. 3501(10)) and a member of 
                        the International Monetary Fund, and
                          (iii) such country is not dominated 
                        or controlled by international 
                        communism.
                  (B) Such country is a party to an arrangement 
                of countries and participates in any action 
                pursuant to such arrangement, the effect of 
                which is--
                          (i) to withhold supplies of vital 
                        commodity resources from international 
                        trade or to raise the price of such 
                        commodities to an unreasonable level, 
                        and
                          (ii) to cause serious disruption of 
                        the world economy.
                  (C) Such country affords preferential 
                treatment to the products of a developed 
                country, other than the United States, which 
                has, or is likely to have, a significant 
                adverse effect on United States commerce.
                  (D)(i) Such country--
                          (I) has nationalized, expropriated, 
                        or otherwise seized ownership or 
                        control of property, including 
                        patents, trademarks, or copyrights, 
                        owned by a United States citizen or by 
                        a corporation, partnership, or 
                        association which is 50 percent or more 
                        beneficially owned by United States 
                        citizens,
                          (II) has taken steps to repudiate or 
                        nullify an existing contract or 
                        agreement with a United States citizen 
                        or a corporation, partnership, or 
                        association which is 50 percent or more 
                        beneficially owned by United States 
                        citizens, the effect of which is to 
                        nationalize, expropriate, or otherwise 
                        seize ownership or control of property, 
                        including patents, trademarks, or 
                        copyrights, so owned, or
                          (III) has imposed or enforced taxes 
                        or other 
                        exactions, restrictive maintenance or 
                        operational conditions, or other 
                        measures with respect to property, 
                        including patents, trademarks, or 
                        copyrights, so owned, the effect of 
                        which is to nationalize, expropriate, 
                        or otherwise seize ownership or control 
                        of such property, unless clause (ii) 
                        applies.
                  (ii) This clause applies if the President 
                determines that--
                          (I) prompt, adequate, and effective 
                        compensation has been or is being made 
                        to the citizen, corporation, 
                        partnership, or association referred to 
                        in clause (i),
                          (II) good faith negotiations to 
                        provide prompt, adequate, and effective 
                        compensation under the applicable 
                        provisions of international law are in 
                        progress, or the country described in 
                        clause (i) is otherwise taking steps to 
                        discharge its obligations under 
                        international law with respect to such 
                        citizen, corporation, partnership, or 
                        association, or
                          (III) a dispute involving such 
                        citizen, corporation, partnership, or 
                        association over compensation for such 
                        a seizure has been submitted to 
                        arbitration under the provisions of the 
                        Convention for the Settlement of 
                        Investment Disputes, or in another 
                        mutually agreed upon forum, and the 
                        President promptly furnishes a copy of 
                        such determination to the Senate and 
                        House of Representatives.
                  (E) Such country fails to act in good faith 
                in recognizing as binding or in enforcing 
                arbitral awards in favor of United States 
                citizens or a corporation, partnership, or 
                association which is 50 percent or more 
                beneficially owned by United States citizens, 
                which have been made by arbitrators appointed 
                for each case or by permanent arbitral bodies 
                to which the parties involved have submitted 
                their dispute.
                  (F) Such country aids or abets, by granting 
                sanctuary from prosecution to, any individual 
                or group which has committed an act of 
                international terrorism or the Secretary of 
                State makes a determination with respect to 
                such country under section 6(j)(1)(A) of the 
                Export Administration Act of 1979.
                  (G) Such country has not taken or is not 
                taking steps to afford internationally 
                recognized worker rights to workers in the 
                country (including any designated zone in that 
                country).
                  (H) Such country has not implemented its 
                commitments to eliminate the worst forms of 
                child labor.
        Subparagraphs (D), (E), (F), (G) and (H) (to the extent 
        described in section 507(6)(D)) shall not prevent the 
        designation of any country as a beneficiary developing 
        country under this title if the President determines 
        that such designation will be in the national economic 
        interest of the United States and reports such 
        determination to the Congress with the reasons 
        therefor.
  (c) Factors Affecting Country Designation.--In determining 
whether to designate any country as a beneficiary developing 
country under this title, the President shall take into 
account--
           (1) an expression by such country of its desire to 
        be so designated;
          (2) the level of economic development of such 
        country, including its per capita gross national 
        product, the living standards of its inhabitants, and 
        any other economic factors which the President deems 
        appropriate;
          (3) whether or not other major developed countries 
        are extending generalized preferential tariff treatment 
        to such country;
          (4) the extent to which such country has assured the 
        United States that it will provide equitable and 
        reasonable access to the markets and basic commodity 
        resources of such country and the extent to which such 
        country has assured the United States that it will 
        refrain from engaging in unreasonable export practices;
          (5) the extent to which such country is providing 
        adequate and effective protection of intellectual 
        property rights;
          (6) the extent to which such country has taken 
        action to--
                  (A) reduce trade distorting investment 
                practices and policies (including export 
                performance requirements); and
                  (B) reduce or eliminate barriers to trade in 
                services; and
          (7) whether or not such country has taken or is 
        taking steps to afford to workers in that country 
        (including any designated zone in that country) 
        internationally recognized worker rights.
  (d) Withdrawal, Suspension, or Limitation of Country 
Designation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any country. 
        In taking any action under this subsection, the 
        President shall consider the factors set forth in 
        section 501 and subsection (c) of this section.
          (2) Changed circumstances.--The President shall, 
        after complying with the requirements of subsection 
        (f)(2), withdraw or suspend the designation of any 
        country as a beneficiary developing country if, after 
        such designation, the President determines that as the 
        result of changed circumstances such country would be 
        barred from designation as a beneficiary developing 
        country under subsection (b)(2). Such country shall 
        cease to be a beneficiary developing country on the day 
        on which the President issues an Executive order or 
        Presidential proclamation revoking the designation of 
        such country under this title.
          (3) Advice to congress.--The President shall, as 
        necessary, advise the Congress on the application of 
        section 501 and subsection (c) of this section, and the 
        actions the President has taken to withdraw, to 
        suspend, or to limit the application of duty-free 
        treatment with respect to any country which has failed 
        to adequately take the actions described in subsection 
        (c).
  (e) Mandatory Graduation of Beneficiary Developing 
Countries.--If the President determines that a beneficiary 
developing country has become a `high income' country, as 
defined by the official statistics of the International Bank 
for Reconstruction and Development, then the President shall 
terminate the designation of such country as a beneficiary 
developing country for purposes of this title, effective on 
January 1 of the second year following the year in which such 
determination is made.
  (f) Congressional Notification.--
           (1) Notification of designation.--
                  (A) In general.--Before the President 
                designates any country as a beneficiary 
                developing country under this title, the 
                President shall notify the Congress of the 
                President's intention to make such designation, 
                together with the considerations entering into 
                such decision.
                  (B) Designation as least-developed 
                beneficiary developing country and beneficiany 
                sub-Saharan African countries.--At least 60 
                days before the President designates any 
                country as a least-developed beneficiary 
                developing country, the President shall notify 
                the Congress of the President's intention to 
                make such designation or any beneficiany sub-
                Saharan African country.
          (2) Notification of termination.--If the President 
        has designated any country as a beneficiary developing 
        country under this title, the President shall not 
        terminate such designation unless, at least 60 days 
        before such termination, the President has notified the 
        Congress and has notified such country of the 
        President's intention to terminate such designation, 
        together with the considerations entering into such 
        decision.

SEC. 503. DESIGNATION OF ELIGIBLE ARTICLES.

   (a) Eligible Articles.--
          (1) Designation.--
                  (A) In general.--Except as provided in 
                subsection (b), the President is authorized to 
                designate articles as eligible articles from 
                all beneficiary developing countries for 
                purposes of this title by Executive order or 
                Presidential proclamation after receiving the 
                advice of the International Trade Commission in 
                accordance with subsection (e).
                  (B) Least-developed beneficiary developing 
                countries.--Except for articles described in 
                subparagraphs (A), (B), and (E) of subsection 
                (b)(1) and articles described in paragraphs (2) 
                and (3) of subsection (b), the President may, 
                in carrying out section 502(d)(1) and 
                subsection (c)(1) of this section, designate 
                articles as eligible articles only for 
                countries designated as least-developed 
                beneficiary developing countries under section 
                502(a)(2) if, after receiving the advice of the 
                International Trade Commission in accordance 
                with subsection (e) of this section, the 
                President determines that such articles are not 
                import-sensitive in the context of imports from 
                least-developed beneficiary developing 
                countries.
                  (C) Three-year rule.--If, after receiving the 
                advice of the International Trade Commission 
                under subsection (e), an article has been 
                formally considered for designation as an 
                eligible article under this title and denied 
                such designation, such article may not be 
                reconsidered for such designation for a period 
                of 3 years after such denial.
          (2) Rule of origin.--
                  (A) General rule.--The duty-free treatment 
                provided under this title shall apply to any 
                eligible article which is the growth, product, 
                or manufacture of a beneficiary developing 
                country if--
                          (i) that article is imported directly 
                        from a beneficiary developing country 
                        into the customs territory of the 
                        United States; and
                          (ii) the sum of--
                                  (I) the cost or value of the 
                                materials produced in the 
                                beneficiary developing country 
                                or any two or more such 
                                countries that are members of 
                                the same association of 
                                countries and are treated as 
                                one country under section 
                                507(2), plus
                                  (II) the direct costs of 
                                processing operations performed 
                                in such beneficiary developing 
                                country or such member 
                                countries, is not less than 35 
                                percent of the appraised value 
                                of such article at the time it 
                                is entered.
                  (B) Exclusions.--An article shall not be 
                treated as the growth, product, or manufacture 
                of a beneficiary developing country by virtue 
                of having merely undergone--
                          (i) simple combining or packaging 
                        operations, or
                          (ii) mere dilution with water or mere 
                        dilution with another substance that 
                        does not materially alter the 
                        characteristics of the article.
          (3) Regulations.--The Secretary of the Treasury, 
        after consulting with the United States Trade 
        Representative, shall prescribe such regulations as may 
        be necessary to carry out paragraph (2), including, but 
        not limited to, regulations providing that, in order to 
        be eligible for duty-free treatment under this title, 
        an article--
                  (A) must be wholly the growth, product, or 
                manufacture of a beneficiary developing 
                country, or
                  (B) must be a new or different article of 
                commerce which has been grown, produced, or 
                manufactured in the beneficiary developing 
                country.
  (b) Articles That May Not Be Designated As Eligible 
Articles.--
          (1) Import sensitive articles.--The President may not 
        designate any article as an eligible article under 
        subsection (a) if such article is within one of the 
        following categories of import-sensitive articles:
                  (A) Textile and apparel articles which were 
                not eligible articles for purposes of this 
                title on January 1, 1994, as this title was in 
                effect on such date.
                  (B) Watches, except those watches entered 
                after June 30, 1989, that the President 
                specifically determines, after public notice 
                and comment, will not cause material injury to 
                watch or watch band, strap, or bracelet 
                manufacturing and assembly operations in the 
                United States or the United States insular 
                possessions.
                  (C) Import-sensitive electronic articles.
                  (D) Import-sensitive steel articles.
                  (E) Footwear, handbags, luggage, flat goods, 
                work gloves, and leather wearing apparel which 
                were not eligible articles for purposes of this 
                title on January 1, 1995, as this title was in 
                effect on such date.
                  (F) Import-sensitive semimanufactured and 
                manufactured glass products.
                  (G) Any other articles which the President 
                determines to be import-sensitive in the 
                context of the Generalized System of 
                Preferences.
          (2) Articles against which other actions taken.--An 
        article shall not be an eligible article for purposes 
        of this title for any period during which such article 
        is the subject of any action proclaimed pursuant to 
        section 203 of this Act (19 U.S.C. 2253) or section 232 
        or 351 of the Trade Expansion Act of 1962 (19 U.S.C. 
        1862, 1981).
          (3) Agricultural products.--No quantity of an 
        agricultural product subject to a tariff-rate quota 
        that exceeds the in-quota quantity shall be eligible 
        for duty-free treatment under this title.
  (c) Withdrawal, Suspension, or Limitation of Duty-Free 
Treatment; Competitive Need Limitation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any article, 
        except that no rate of duty may be established with 
        respect to any article pursuant to this subsection 
        other than the rate which would apply but for this 
        title. In taking any action under this subsection, the 
        President shall consider the factors set forth in 
        sections 501 and 502(c).
          (2) Competitive need limitation.--
                  (A) Basis for withdrawal of duty-free 
                treatment.--
                          (i) In general.--Except as provided 
                        in clause (ii) and subject to 
                        subsection (d), whenever the President 
                        determines that a beneficiary 
                        developing country has exported 
                        (directly or indirectly) to the United 
                        States during any calendar year 
                        beginning after December 31, 1995--
                                  (I) a quantity of an eligible 
                                article having an appraised 
                                value in excess of the 
                                applicable amount for the 
                                calendar year, or
                                  (II) a quantity of an 
                                eligible article equal to or 
                                exceeding 50 percent of the 
                                appraised value of the total 
                                imports of that article into 
                                the United States during any 
                                calendar year, the President 
                                shall, not later than July 1 of 
                                the next calendar year, 
                                terminate the duty-free 
                                treatment for that article from 
                                that beneficiary developing 
                                country.
                          (ii) Annual adjustment of applicable 
                        amount.--For purposes of applying 
                        clause (i), the applicable amount is--
                                  (I) for 1996, $75,000,000, 
                                and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $5,000,000.
                  (B) Country defined.--For purposes of this 
                paragraph, the term ``country'' does not 
                include an association of countries which is 
                treated as one country under section 507(2), 
                but does include a country which is a member of 
                any such association.
                  (C) Redesignations.--A country which is no 
                longer treated as a beneficiary developing 
                country with respect to an eligible article by 
                reason of subparagraph (A) may, subject to the 
                considerations set forth in sections 501 and 
                502, be redesignated a beneficiary developing 
                country with respect to such article if imports 
                of such article from such country did not 
                exceed the limitations in subparagraph (A) 
                during the preceding calendar year.
                  (D) Least-developed beneficiary developing 
                countries and beneficiary sub-saharan african 
                countries.--Subparagraph (A) shall not apply to 
                any least-developed beneficiary developing 
                country or any beneficiary sub-Saharan African 
                country.
                  (E) Articles not produced in the united 
                states excluded.--Subparagraph (A)(i)(II) shall 
                not apply with respect to any eligible article 
                if a like or directly competitive article was 
                not produced in the United States on January 1, 
                1995.
                  (F) De minimis waivers.--
                          (i) In general.--The President may 
                        disregard subparagraph (A)(i)(II) with 
                        respect to any eligible article from 
                        any beneficiary developing country if 
                        the aggregate appraised value of the 
                        imports of such article into the United 
                        States during the preceding calendar 
                        year does not exceed the applicable 
                        amount for such preceding calendar 
                        year.
                          (ii) Applicable amount.--For purposes 
                        of applying clause (i), the applicable 
                        amount is--
                                  (I) for calendar year 1996, 
                                $13,000,000, and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $500,000.
  (d) Waiver of Competitive Need Limitation.--
          (1) In general.--The President may waive the 
        application of subsection (c)(2) with respect to any 
        eligible article of any beneficiary developing country 
        if, before July 1 of the calendar year beginning after 
        the calendar year for which a determination described 
        in subsection (c)(2)(A) was made with respect to such 
        eligible article, the President--
                  (A) receives the advice of the International 
                Trade Commission under section 332 of the 
                Tariff Act of 1930 on whether any industry in 
                the United States is likely to be adversely 
                affected by such waiver,
                  (B) determines, based on the considerations 
                described in sections 501 and 502(c) and the 
                advice described in subparagraph (A), that such 
                waiver is in the national economic interest of 
                the United States, and
                  (C) publishes the determination described in 
                subparagraph (B) in the Federal Register.
          (2) Considerations by the president.--In making any 
        determination under paragraph (1), the President shall 
        give great weight to--
                  (A) the extent to which the beneficiary 
                developing country has assured the United 
                States that such country will provide equitable 
                and reasonable access to the markets and basic 
                commodity resources of such country, and
                  (B) the extent to which such country provides 
                adequate and effective protection of 
                intellectual property rights.
          (3) Other bases for waiver.--The President may waive 
        the application of subsection (c)(2) if, before July 1 
        of the calendar year beginning after the calendar year 
        for which a determination described in subsection 
        (c)(2) was made with respect to a beneficiary 
        developing country, the President determines that--
                  (A) there has been a historical preferential 
                trade relationship between the United States 
                and such country,
                  (B) there is a treaty or trade agreement in 
                force covering economic relations between such 
                country and the United States, and
                  (C) such country does not discriminate 
                against, or impose unjustifiable or 
                unreasonable barriers to, United States 
                commerce,
        and the President publishes that determination in the 
        Federal Register.
          (4) Limitations on waivers.--
                  (A) In general.--The President may not 
                exercise the waiver authority under this 
                subsection with respect to a quantity of an 
                eligible article entered during any calendar 
                year beginning after 1995, the aggregate 
                appraised value of which equals or exceeds 30 
                percent of the aggregate appraised value of all 
                articles that entered duty-free under this 
                title during the preceding calendar year.
                  (B) Other waiver limits.--The President may 
                not exercise the waiver authority provided 
                under this subsection with respect to a 
                quantity of an eligible article entered during 
                any calendar year beginning after 1995, the 
                aggregate appraised value of which exceeds 15 
                percent of the aggregate appraised value of all 
                articles that have entered duty-free under this 
                title during the preceding calendar year from 
                those beneficiary developing countries which 
                for the preceding calendar year--
                          (i) had a per capita gross national 
                        product (calculated on the basis of the 
                        best available information, including 
                        that of the International Bank for 
                        Reconstruction and Development) of 
                        $5,000 or more; or
                          (ii) had exported (either directly or 
                        indirectly) to the United States a 
                        quantity of articles that was duty-free 
                        under this title that had an aggregate 
                        appraised value of more than 10 percent 
                        of the aggregate appraised value of all 
                        articles that entered duty-free under 
                        this title during that year.
                  (C) Calculation of limitations.--There shall 
                be counted against the limitations imposed 
                under subparagraphs (A) and (B) for any 
                calendar year only that value of any eligible 
                article of any country that--
                          (i) entered duty-free under this 
                        title during such calendar year; and
                          (ii) is in excess of the value of 
                        that article that would have been so 
                        entered during such calendar year if 
                        the limitations under subsection 
                        (c)(2)(A) applied.
          (5) Effective period of waiver.--Any waiver granted 
        under this subsection shall remain in effect until the 
        President determines that such waiver is no longer 
        warranted due to changed circumstances.
  (e) International Trade Commission Advice.--Before 
designating articles as eligible articles under subsection 
(a)(1), the President shall publish and furnish the 
International Trade Commission with lists of articles which may 
be considered 
for designation as eligible articles for purposes of this 
title. The provisions of sections 131, 132, 133, and 134 shall 
be complied with as though action under section 501 and this 
section were action under section 123 to carry out a trade 
agreement entered into under section 123.
  (f) Special Rule Concerning Puerto Rico.--No action under 
this title may affect any tariff duty imposed by the 
Legislature of Puerto Rico pursuant to section 319 of the 
Tariff Act of 1930 on coffee imported into Puerto Rico.(19 
U.S.C. 2463)

SEC. 504. REVIEW AND REPORT TO CONGRESS.

  The President shall submit an annual report to the Congress 
on the status of internationally recognized worker rights 
within each beneficiary developing country, including the 
findings of the Secretary of Labor with respect to the 
beneficiary country's implementation of its international 
commitments to eliminate the worst forms of child labor.

SEC. 505. DATE OF TERMINATION.

  No duty-free treatment provided under this title shall remain 
in effect after September 30, 2001.

SEC. 506. AGRICULTURAL EXPORTS OF BENEFICIARY DEVELOPING COUNTRIES.

  The appropriate agencies of the United States shall assist 
beneficiary developing countries to develop and implement 
measures designed to assure that the agricultural sectors of 
their economies are not directed to export markets to the 
detriment of the production of foodstuffs for their citizenry.

SEC. 506A. DESIGNATION OF SUB-SAHARAN AFRICAN COUNTRIES FOR CERTAIN 
                    BENEFITS.

  (a) Authority to Designate.--
          (1) In general.--Notwithsanding any other provision 
        of law, the President is authorized to designate a 
        country listed in section 107 of the African Growth and 
        Opportunity Act as a beneficiary sub-Saharan African 
        country eligible for the benefits described in 
        subsection (b)--
                  (A) if the President determines that the 
                country meets the eligibility requirements set 
                forth in section 104 of that Act, as such 
                requirements are in effect on the date of the 
                enactment of that Act: and
                  (B) subject to the authority granted to the 
                President under subsections (a), (d), and (e) 
                of section 502, if the country otherwise meets 
                the eligibility criteria set forth in section 
                502.
          (2) Monitoring and review of certain countries.--The 
        President shall monitor, review, and report to Congress 
        annually on the progress of each country listed in 
        section 107 of the African Growth and Opportunity Act 
        in meeting the requirements described in paragraph (1) 
        in order to determine the current or potential 
        eligibility of each country to be designated as a 
        beneficiary sub-Saharan African country for purposes of 
        this section. The President's determinations, and 
        explanations of such determinations, with specific 
        analysis of the eligibility requirements described in 
        paragraph (1)(A), shall be included in the annual 
        report required by section 106 of the African Growth 
        and Opportunity Act.
          (3) Continuing compliance.--If the President 
        determines that a beneficiary sub-Saharan African 
        country is not making continual progress in meeting the 
        requirements described in paragraph (1), the President 
        shall terminate the designation of that country as a 
        beneficiary sub-Saharan African country for purposes of 
        this section, effective on January 1 of the year 
        following the year in which such determination is made.
                  (b) Preferential Tariff Treatment for Certain 
                Articles.--
          (1) In general.--The President may provide duty-free 
        treatment for any article described in section 
        503(b)(1)(B) through (G) that is the growth, product, 
        or manufacture of a beneficiary sub-Saharan African 
        country described in subsection (a), if after receiving 
        the advice of the International Trade Commission in 
        accordance with section 503(e), the President 
        determines that such article is not import-sensitive in 
        the context of imports from beneficiary sub-Saharan 
        African countries.
          (2) Rules of origin.--The duty-free treatment 
        provided under paragraph (1) shall apply to any article 
        described in that paragraph that meets the requirements 
        of section 503(a)(2), except that--
          (A) if the cost or value of materials produced in the 
        customs territory of the United States is included with 
        respect to that article, an amount not to exceed 15 
        exceed 15 percent of the appraised value of the article 
        at the time it is entered that is attributed to such 
        United States cost or value may be applied toward 
        determining the percentage referred to in subparagraph 
        (A) of section 503(a)(2); and
          (B) the cost or value of the materials included with 
        respect to that article that are produced in one or 
        more beneficiary sub-Saharan African countries shall be 
        applied in determining such percentage.
          (c) Beneficiary Sub-Saharan African Countries, Etc.--
        For purposes of this title, the terms ``beneficiary 
        sub-Saharan African country'' and ``beneficiary sub-
        Saharan African countries'' mean a country or countries 
        listed in section 107 of the African Growth and 
        Opportunity Act that the President has determined is 
        eligible under subsection (a) of this section.

SEC. 506B. TERMINATION OF BENEFITS FOR SUB-SAHARAN AFRICAN COUNTRIES.

  In the case of a beneficiary sub-Saharan African country, as 
defined in section 506A(c), duty-free treatment provided under 
this title shall remain in effect through September 30, 2008.

SEC. 507. DEFINITIONS.

  For purposes of this title:
          (1) Beneficiary developing country.--The term 
        ``beneficiary developing country'' means any country 
        with respect to which there is in effect an Executive 
        order or Presidential proclamation by the President 
        designating such country as a beneficiary developing 
        country for purposes of this title.
          (2) Country.--The term ``country'' means any foreign 
        country or territory, including any overseas dependent 
        territory or possession of a foreign country, or the 
        Trust Territory of the Pacific Islands. In the case of 
        an association of countries which is a free trade area 
        or customs union, or which is contributing to 
        comprehensive regional economic integration among its 
        members through appropriate means, including, but not 
        limited to, the reduction of duties, the President may 
        by Executive order or Presidential proclamation provide 
        that all members of such association other than members 
        which are barred from designation under section 502(b) 
        shall be treated as one country for purposes of this 
        title.
          (3) Entered.--The term ``entered'' means entered, or 
        withdrawn from warehouse for consumption, in the 
        customs territory of the United States.
          (4) Internationally recognized worker rights.--The 
        term ``internationally recognized worker rights'' 
        includes--
                  (A) the right of association;
                  (B) the right to organize and bargain 
                collectively;
                  (C) a prohibition on the use of any form of 
                forced or compulsory labor;
                  (D) a minimum age for the employment of 
                children; and
                  (E) acceptable conditions of work with 
                respect to 
                minimum wages, hours of work, and occupational 
                safety and health.
          (5) Least-developed beneficiary developing country.--
        The term ``least-developed beneficiary developing 
        country'' means a beneficiary developing country that 
        is designated as a least-developed beneficiary 
        developing country under section 502(a)(2).
          (6) Worst forms of child labor.--The term ``worst 
        forms of child labor'' means--
                  (A) all forms of slavery or practices similar 
                to slavery, such as the sale or trafficking of 
                children, debt bondage and serfdom, or forced 
                or compulsory labor, including forced or 
                compulsory recruitment of children for use in 
                armed conflict;
                  (B) the use, procuring, or offering of a 
                child for prostitution, for the production of 
                pornography or for pornographic purposes;
                  (C) The use, procuring, or offering of a 
                child for illicit activities in particular for 
                the production and trafficking of drugs; and
                  (D) work which, by its nature or the 
                circumstances in which it is carried out, is 
                likely to harm the health, safety, or morals of 
                children.
  The work referred to in subparagraph (D) shall be determined 
by the laws, regulations, or competent authority of the 
beneficiary developing country involved.

            General Note 4 of the Harmonized Tariff Schedule


Products of Countries Designated Beneficiary Developing Countries for 
        Purposes of the Generalized System of Preferences (GSP)

    (a) The following countries, territories and associations 
of countries eligible for treatment as one country (pursuant to 
section 502(a)(3) of the Trade Act of 1974 (19 U.S.C. 
2462(a)(3)) are designated beneficiary developing countries for 
the purposes of the Generalized System of Preferences, provided 
for in Title V of the Trade Act of 1974, as amended (19 U.S.C. 
2461 et seq.):

                         Independent Countries

    Albania                               Ethiopia
    Angola                                Fiji
    Antigua and Barbuda                   Gabon
    Argentina                             Gambia, The
    Armenia                               Ghana
    Bahrain                               Grenada
    Bangladesh                            Guatemala
    Barbados                              Guinea
    Belarus                               Guinea-Bissau
    Belize                                Guyana
    Benin                                 Haiti
    Bhutan                                Honduras
    Bolivia                               Hungary
    Bosnia and Hercegovina                India
    Brazil                                Indonesia
    Bulgaria                              Jamaica
    Burkina Faso                          Jordan
    Burundi                               Kazakhstan
    Cambodia                              Kenya
    Cameroon                              Kiribati
    Cape Verde                            Kyrgyzstan
    Central African Republic              Latvia
    Chad                                  Lebanon
    Chile                                 Lesotho
    Colombia                              Lithuania
    Comoros                               Macedonia, Former Yugoslav
    Congo (Brazzaville)                     Republic of
        Congo (Kinshasa)                      Madagascar
    Costa Rica                            Malawi
    Cote d'Ivoire                         Mali
    Croatia                               Malta
    Czech Republic                        Mauritania
    Djibouti                              Mauritius
    Dominica                              Moldova
    Dominican Republic                    Mongolia
    Ecuador                               Morocco
    Egypt                                 Mozambique
    El Salvador                           Namibia
    Equatorial Guinea                     Nepal
    Estonia                               Niger
    Oman                                  South Africa
    Pakistan                              Sri Lanka
    Panama                                Suriname
    Papua New Guinea                      Swaziland
    Paraguay                              Tanzania
    Peru                                  Thailand
    Philippines                           Togo
    Poland                                Tonga
    Romania                               Trinidad and Tobago
    Russia                                Tunisia
    Rwanda                                Turkey
    St. Kitts and Nevis                   Tuvalu
    Saint Lucia                           Uganda
    Saint Vincent and the                 Ukraine
      Grenadines                          Uruguay
    Sao Tome and Principe                 Uzbekistan
    Senegal                               Vanuatu
    Seychelles                            Venezuela
    Sierra Leone                          Western Samoa
    Slovakia                              Republic of Yemen
    Slovenia                              Zambia
    Solomon Islands                       Zimbabwe
    Somalia                               
    
               Non-Independent Countries and Territories

    Anguilla                              Niue
    British Indian Ocean Territory        Norfolk Island
    Christmas Island (Australia)          Pitcairn Islands
    Cocos (Keeling) Islands               Saint Helena
    Cook Islands                          Tokelau
    Falkland Islands (Islas Malvinas)     Turks and Caicos Islands
    French Polynesia                      Virgin Islands, British
    Gibraltar                             Wallis and Futuna
    Heard Island and McDonald Islands     West Bank and Gaza Strip
    Montserrat                            Western Sahara
    New Caledonia                         

           Associations of Countries (treated as one country)

                                                Member
   Member                         Member     Countries of     Members
Countries of  Members of the   Countries of    the West     Countries of
     the      Association of  the Caribbean     African     the Southern
  Cartagena     South East    Common Market  Economic and     African
  Agreement    Asian Nations    (CARICOM),     Monetary     Development
   (Andean        (ASEAN)       except The       Union       Community
   Group)                        Bahamas        (WAEMU)        (SADC)

    Consisti    Currently     Consisting     Consisting      Currently
     ng of:    qualifying:     of:            of:           qualifying:
    Bolivia     Cambodia      Antigua and    Benin           Botswana
                               Barbuda
    Colombia    Indonesia     Barbados       Burkina Faso    Mauritius
    Ecuador     Philippines   Belize         Cote            Tanzania
                                              d'Ivorie
    Peru        Thailand      Dominica       Guinea-
                                              Bissau
    Venezuel                  Grenada        Mali
     a
                              Guyana         Niger
                              Jamaica        Senegal
                              Montserrat     Togo
                              St. Kitts and
                               Nevis
                              Saint Lucia
                              Saint Vincent
                               and
                                the
                               Grenadines
                              Trinidad and
                               Tobago



    (b) The following beneficiary countries are designated as 
least-developed beneficiary developing countries pursuant to 
section 502(a)(2) of the Trade Act of 1974, as amended:

    Angola                            Kiribati
    Bangladesh                        Lesotho
    Benin                             Madagascar
    Bhutan                            Malawi
    Burkina Faso                      Mali
    Burundi                           Mozambique
    Cambodia                          Nepal
    Cape Verde                        Niger
    Central African Republic          Rwanda
    Chad                              Sao Tome and Principe
    Comoros                           Sierra Leone
    Congo (Kinshasa)                  Somalia
    Djibouti                          Tanzania
    Equatorial Guinea                 Togo
    Ethiopia                          Tuvalu
    Gambia, The                       Uganda
    Guinea                            Vanuatu
    Guinea-Bissau                     Republic of Yemen
    Haiti                             Zambia

Whenever an eligible article which is the growth, product or 
manufacture of one of the countries designated as a least-
developed beneficiary developing country is imported into the 
customs territory of the United States directly from such 
country, such article shall be entitled to receive the duty-
free treatment provided for in subdivision (c) of this note 
without regard to the limitations on preferential treatment of 
eligible articles in section 503(c)(2)(A) of the Trade Act, as 
amended (19 U.S.C. 2464(c)(2)(A)).

                  D. CARIBBEAN BASIN INITIATIVE (CBI)


           Caribbean Basin Economic Recovery Act, as amended


 [19 U.S.C. 2701 et seq.; P.L. 98-67, title II, as amended by P.L. 98-
  573, P.L. 99-514, P.L. 99-570, P.L. 100-418, P.L. 100-647, P.L. 101-
 382, P.L. 103-182, P.L. 103-465, P.L. 104-188, P.L. 104-295, and P.L. 
                                106-200]

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Caribbean Basin Economic 
Recovery Act''.

                     Subtitle A--Duty-Free Treatment


SEC. 211. AUTHORITY TO GRANT DUTY-FREE TREATMENT.

    The President may proclaim duty-free treatment or other 
preferential treatment for all eligible articles from any 
beneficiary country in accordance with the provisions of this 
title.

SEC. 212. BENEFICIARY COUNTRY.

    (a)(1) For purposes of this title--
          (A) The term ``beneficiary country'' means any 
        country listed in subsection (b) with respect to which 
        there is in effect a proclamation by the President 
        designating such country as a beneficiary country for 
        purposes of this title. Before the President designates 
        any country as a beneficiary country for purposes of 
        this title, he shall notify the House of 
        Representatives and the Senate of his intention to make 
        such designation, together with the considerations 
        entering into such decision.
          (B) The term ``entered'' means entered, or withdrawn 
        from warehouse for consumption, in the customs 
        territory of the United States.
          (C) The term ``HTS'' means Harmonized Tariff Schedule 
        of the United States (19 U.S.C. 1202).
          (D) The term ``NAFTA'' means the North American Free 
        Trade Agreement entered into between the United States, 
        Mexico, and Canada on December 17, 1992.
          (E) The terms ``WTO'' and ``WTO member'' have the 
        meanings given those terms in section 2 of the Uruguay 
        Round Agreements Act (19 U.S.C. 3501).
    (2) If the President has designated any country as a 
beneficiary country for purposes of this title, he shall not 
terminate such designation (either by issuing a proclamation 
for that purpose or by issuing a proclamation which has the 
effect of terminating such designation) unless, at least sixty 
days before such termination, he has notified the House of 
Representatives and the Senate and has notified such country of 
his intention to terminate such designation, together with the 
considerations entering into such decision.
    (b) In designating countries as ``beneficiary countries'' 
under this title the President shall consider only the 
following countries and territories or successor political 
entities:

    Anguilla                            Honduras
    Antigua and Barbuda                 Jamaica
    Bahamas, The                        Montserrat
    Barbados                            Netherlands Antilles
    Belize                              Nicaragua
    Cayman Islands                      Panama
    Costa Rica                          Saint Lucia
    Dominica                            Saint Vincent and the
    Dominican Republic                    Grenadines
    El Salvador                         Suriname
    Grenada                             Trinidad and Tobago
    Guatemala                           Saint Christopher-Nevis
    Guyana                              Turks and Caicos Islands
    Haiti                               Virgin Islands, British

In addition, the President shall not designate any country a 
beneficiary country under this title--
          (1) if such country is a Communist country;
          (2) if such country--
                  (A) has nationalized, expropriated or 
                otherwise seized ownership or control of 
                property owned by a United States citizen or by 
                a corporation, partnership, or association 
                which is 50 per centum or more beneficially 
                owned by United States citizens,
                  (B) has taken steps to repudiate or nullify--
                          (i) any existing contract or 
                        agreement with, or
                          (ii) any patent, trademark, or other 
                        intellectual property of,
                a United States citizen or a corporation, 
                partnership, or association which is 50 per 
                centum or more beneficially owned by United 
                States citizens, the effect of which is to 
                nationalize, expropriate, or otherwise seize 
                ownership or control of property so owned, or
                  (C) has imposed or enforced taxes or other 
                exactions, restrictive maintenance or 
                operational conditions, or other measures with 
                respect to property so owned, the effect of 
                which is to nationalize, expropriate, or 
                otherwise seize ownership or control of such 
                property, unless the President determines 
                that--
                          (i) prompt, adequate, and effective 
                        compensation has been or is being made 
                        to such citizen, corporation, 
                        partnership, or association,
                          (ii) good-faith negotiations to 
                        provide prompt, adequate, and effective 
                        compensation under the applicable 
                        provisions of international law are in 
                        progress, or such country is otherwise 
                        taking steps to discharge its 
                        obligations under international law 
                        with respect to such citizen, 
                        corporation, partnership, or 
                        association, or
                          (iii) a dispute involving such 
                        citizen, corporation, partnership, or 
                        association, over compensation for such 
                        a seizure has been submitted to 
                        arbitration under the provisions of the 
                        Convention for the Settlement of 
                        Investment Disputes, or in another 
                        mutually agreed upon forum, and
        promptly furnishes a copy of such determination to the 
        Senate and House of Representatives;
          (3) if such country fails to act in good faith in 
        recognizing as binding or in enforcing arbitral awards 
        in favor of United States citizens or a corporation, 
        partnership or association which is 50 per centum or 
        more beneficially owned by United States citizens which 
        have been made by arbitrators appointed for each case 
        or by permanent arbitral bodies to which the parties 
        involved have submitted their dispute;
          (4) if such country affords preferential treatment to 
        the products of a developed country, other than the 
        United States, which has, or is likely to have, a 
        significant adverse effect on United States commerce, 
        unless the President has received assurances 
        satisfactory to him that such preferential treatment 
        will be eliminated or that action will be taken to 
        assure that there will be no such significant adverse 
        effect, and he reports those assurances to the 
        Congress;
          (5) if a government-owned entity in such country 
        engages in the broadcast of copyrighted material, 
        including films or television material, belonging to 
        United States copyright owners without their express 
        consent;
          (6) unless such country is a signatory to a treaty, 
        convention, protocol, or other agreement regarding the 
        extradition of United States citizens; and
          (7) if such country has not or is not taking steps to 
        afford internationally recognized worker rights (as 
        defined in section 507(4) of the Trade Act of 1974) to 
        workers in the country (including any designated zone 
        in that country).
Paragraphs (1), (2), (3), (5), and (7) shall not prevent the 
designation of any country as a beneficiary country under this 
Act if the President determines that such designation will be 
in the national economic or security interest of the United 
States and reports such determination to the Congress with his 
reasons therefor.
    (c) In determining whether to designate any country a 
beneficiary country under this title, the President shall take 
into account--
          (1) an expression by such country of its desire to be 
        so designated;
          (2) the economic conditions in such country, the 
        living standards of its inhabitants, and any other 
        economic factors which he deems appropriate;
          (3) the extent to which such country has assured the 
        United States it will provide equitable and reasonable 
        access to the markets and basic commodity resources of 
        such country;
          (4) the degree to which such country follows the 
        accepted rules of international trade provided for 
        under the WTO Agreement and the multilateral trade 
        agreements (as such terms are defined in paragraphs (9) 
        and (4), respectively, of section 2 of the Uruguay 
        Round Agreements Act);
          (5) the degree to which such country uses export 
        subsidies or imposes export performance requirements or 
        local content requirements which distort international 
        trade;
          (6) the degree to which the trade policies of such 
        country as they relate to other beneficiary countries 
        are contributing to the revitalization of the region;
          (7) the degree to which such country is undertaking 
        self-help measures to promote its own economic 
        development;
          (8) whether or not such country has taken or is 
        taking steps to afford to workers in that country 
        (including any designated zone in that country) 
        internationally recognized worker rights.
          (9) the extent to which such country provides under 
        its law adequate and effective means for foreign 
        nationals to secure, exercise, and enforce exclusive 
        rights in intellectual property, including patent, 
        trademark, and copyright rights;
          (10) the extent to which such country prohibits its 
        nationals from engaging in the broadcast of copyrighted 
        material, including films or television material, 
        belonging to United States copyright owners without 
        their express consent; and
          (11) the extent to which such country is prepared to 
        cooperate with the United States in the administration 
        of the provisions of this title.
          (d) General headnote 3(a) of the TSUS (relating to 
        products of the insular possessions) is amended by 
        adding at the end thereof the following parapgrah:
          ``(iv) Subject to the provisions in section 213 of 
        the Caribbean Basin Economic Recovery Act articles 
        which are imported from insular possessions of the 
        United States shall received duty treatment no less 
        favorable than the treatment afforded such articles 
        when they are imported from a beneficiary country under 
        such Act''.
    (e)(1)(A) The President may, after the requirements of 
subsection (a)(2) and paragraph (2) have been met--
          (i) withdraw or suspend the designation of any 
        country as a beneficiary country, or
          (ii) withdraw, suspend, or limit the application of 
        duty-free treatment under this subtitle to any article 
        of any country,
if, after such designation, the President determines that as a 
result of changed circumstances such country would be barred 
from designation as a beneficiary country under subsection (b).
          (B) The President may, after the requirements of 
        subsection (a)(2) and paragraph (2) have been met--
          (i) withdraw or suspend the designation of any 
        country as a CBTPA beneficiary country; or
          (ii) withdraw, suspend, or limit the application of 
        preferential treatment under section 213(b)(2) and (3) 
        to any article of any country,
if, after such designation, the President determines that, as a 
result of changed circumstances, the performance of such 
country is not satisfactory under the criteria set forth in 
section 213(b)(5)(B).
    (2)(A) The President shall publish in the Federal Register 
notice of the action the President proposes to take under 
paragraph (1) at least 30 days prior to taking such action.
    (B) The United States Trade Representative shall, within 
the 30-day period beginning on the date on which the President 
publishes under subparagraph (A) notice of proposed action--
          (i) accept written comments from the public regarding 
        such proposed action,
          (ii) hold a public hearing on such proposed action, 
        and
          (iii) publish in the Federal Register--
                  (I) notice of the time and place of such 
                hearing prior to the hearing, and
                  (II) the time and place at which such written 
                comments will be accepted.
          (3) If preferential treatment under section 213(b)(2) 
        and (3) is withdrawn, suspended, or limited with 
        respect to a CBTPA beneficiary country, such country 
        shall not be deemed to be a ``party'' for the purposes 
        of applying section 213(b)(5)(C) to imports of articles 
        for which preferential treatment has been withdraw, 
        suspended, or limited with respect to such country.
          (f) Reporting Requirements.--
          In general.--Not later than December 31, 2001, and 
        every 2 years thereafter during the period this title 
        is in effect, the United States Trade Representative 
        shall submit to Congress a report regarding the 
        operation of this title, including--
          (A) with repect to subsections (b) and (c), the 
        results of a general review of beneficiary countries 
        based on the considerations described in such 
        subsections; and
          (B) the performance of each beneficiary country or 
        CBTPA beneficiary country, as the case may be, under 
        the criteria set forth in section 213(b)(5)(B).
          (2) Public comment.--Before submitting the report 
        described in paragraph (1), the United States Trade 
        Representative shall publish a notice in the Federal 
        Register requesting public comments on whether 
        beneficiary countries are meeting the criteria listed 
        in section 213(b)(5)(B).

SEC. 213. ELIGIBLE ARTICLES.

    (a)(1) Unless otherwise excluded from eligibility by this 
title, and subject to section 423 of the Tax Reform Act of 
1986, and except as provided in subsection (b)(2) and (3), the 
duty-free treatment provided under this title shall apply to 
any article which is the growth, product, or manufacture of a 
beneficiary country if--
          (A) that article is imported directly from a 
        beneficiary country into the customs territory of the 
        United States; and
          (B) the sum of (i) the cost or value of the materials 
        produced in a beneficiary country or two or more 
        beneficiary countries, plus (ii) the direct costs of 
        processing operations performed in a beneficiary 
        country or countries is not less than 35 per centum of 
        the appraised value of such article at the time it is 
        entered.
For purposes of determining the percentage referred to in 
subparagraph (B), the term ``beneficiary country'' includes the 
Common-wealth of Puerto Rico and the United States Virgin 
Islands. If the cost or value of materials produced in the 
customs territory of the United States (other than the 
Commonwealth of Puerto Rico) is included with respect to an 
article to which this paragraph applies, an amount not to 
exceed 15 per centum of the appraised value of the article at 
the time it is entered that is attributed to such United States 
cost or value may be applied toward determining the percentage 
referred to in subparagraph (B).
    (2) The Secretary of the Treasury shall prescribe such 
regulations as may be necessary to carry out this subsection 
including, but not limited to, regulations providing that, in 
order to be eligible for duty-free treatment under this title, 
an article must be wholly the growth, product, or manufacture 
of a beneficiary country, or must be a new or different article 
of commerce which has been grown, produced, or manufactured in 
the beneficiary country; but no article or material of a 
beneficiary country shall be eligible for such treatment by 
virtue of having merely undergone--
          (A) simple combining or packaging operations, or
          (B) mere dilution with water or mere dilution with 
        another substance that does not materially alter the 
        characteristics of the article.
    (3) As used in this subsection, the phrase ``direct costs 
of processing operations'' includes, but is not limited to--
          (A) all actual labor costs involved in the growth, 
        production, manufacture, or assembly of the specific 
        merchandise, including fringe benefits, on-the-job 
        training and the cost of engineering, supervisory, 
        quality control, and similar personnel; and
          (B) dies, molds, tooling, and depreciation on 
        machinery and equipment which are allocable to the 
        specific merchandise.
Such phrase does not include costs which are not directly 
attributable to the merchandise concerned or are not costs of 
manufacturing the product, such as (i) profit, and (ii) general 
expenses of doing business which are either not allocable to 
the specific merchandise or are not related to the growth, 
production, manufacture, or assembly of the merchandise, such 
as administrative salaries, casualty and liability insurance, 
advertising, and salesmen's salaries, commissions or expenses.
    (4) Notwithstanding section 311 of the Tariff Act of 1930, 
the products of a beneficiary country which are imported 
directly from any beneficiary country into Puerto Rico may be 
entered under bond for processing or use in manufacturing in 
Puerto Rico. No duty shall be imposed on the withdrawal from 
warehouse of the product of such processing or manufacturing 
if, at the time of such withdrawal, such product meets the 
requirements of paragraph (1)(B).
    (5) The duty-free treatment provided under this title shall 
apply to an article (other than an article listed in subsection 
(b)) which is the growth, product, or manufacture of the 
Commonwealth of Puerto Rico if--
          (A) the article is imported directly from the 
        beneficiary country into the customs territory of the 
        United States,
          (B) the article was by any means advanced in value or 
        improved in condition in a beneficiary country, and
          (C) if any materials are added to the article in a 
        beneficiary country, such materials are a product of a 
        beneficiary country or the United States.
    (6) Notwithstanding paragraph (1), the duty-free treatment 
provided under this title shall apply to liqueurs and 
spirituous beverages produced in the territory of Canada from 
rum if--
          (A) such rum is the growth, product, or manufacture 
        of a beneficiary country or of the Virgin Islands of 
        the United States;
          (B) such rum is imported directly from a beneficiary 
        country or the Virgin Islands of the United States into 
        the territory of Canada, and such liqueurs and 
        spirituous beverages are imported directly from the 
        territory of Canada into the customs territory of the 
        United States;
          (C) when imported into the customs territory of the 
        United States such liqueurs and spirituous beverages 
        are classified in subheading 2208.90 or 2208.40 of the 
        HTS; and
          (D) such rum accounts for at least 90 percent by 
        volume of the alcoholic content of such liqueurs and 
        spirituous beverages.
          (b) Import-Sensitive Articles.--
          (1) In general.--subject to paragraphs (2) through 
        (5), the duty-free treatment provided under this title 
        shall not apply to--
          (A) textile and apparel articles which are subject to 
        textile agreements;
          (B) footwear not designated at the time of the 
        effective date of this title as eligible articles for 
        the purpose of the generalized system of preferences 
        under title V of the Trade Act of 1974;
          (C) tuna, prepared or preserved in any manner, in 
        airtight containers;
          (D) petroleum, or any product derived from petroleum, 
        provided for in headings 2709 and 2710 of the HTS;
          (E) watches and watch parts (including cases, 
        bracelets and straps), of whatever type including, but 
        not limited to, mechanical, quartz digital or quartz 
        analog, if such watches or watch parts contain any 
        material which is the product of any country with 
        respect to which HTS column 2 rates of duty apply; or
          (F) articles to which reduced rates of duty apply 
        under subsection (h).
    (2) Transition period treatment of certain textile and 
apparel articles.--
          (A) Articles covered.--During the transition period, 
        the preferential treatment described in subparagraph 
        (B) shall apply to the following articles:
          (i) Apparel articles assembled in one or more CBTPA 
        beneficiary countries.--Apparel articles assembled in 
        one or more CBTPA beneficiary countries from fabrics 
        wholly formed and cut in the United States, from yarns 
        wholly formed in the United States, (including fabrics 
        not formed from yarns, if such fabrics are classifiable 
        under heading 5602 or 5603 of the HTS and are wholly 
        formed and cut in the United States) that are--
          (I) entered under subheading 9802.00.80 of the HTS; 
        or
          (II) entered under chapter 61 or 62 of the HTS, if, 
        after such assembly, the articles would have qualified 
        for entry under subheading 9802.00.80 of the HTS but 
        for the fact that the articles were embroidered or 
        subjected to stone-washing, enzyme-washing, acid 
        washing, perma-pressing, oven-baking, bleaching, 
        garmet-dyeing, screen printing, or other similar 
        processes.
          (ii) Apparel articles cut and assembled in one or 
        more CBTPA beneficiary countries.--Apparel articles cut 
        in one or more CBTPA beneficiary countries from fabric 
        wholly formed in the United States from yarns wholly 
        formed in the United States (including fabrics not 
        formed from yarns, if such fabrics are classifiable 
        under heading 5602 or 5603 of the HTS and are wholly 
        formed in the United States), if such articles are 
        assembled in one or more such countries with thread 
        formed in the United States), if such articles are 
        assembled in one or more such countries with thread 
        formed in the United States.
                  (iii) Certain knit apparel articles.--(I) 
                Apparel articles knit to shape (other than 
                socks provided for in heading 6115 of the HTS) 
                in a CBTPA beneficiary country from yarns 
                wholly formed in the United States, and knit 
                apparel articles (other than t-shirts described 
                in subclause (III)) cut and wholly assembled in 
                one or more CBTPA beneficiary countries from 
                fabric formed in one or more CBTPA beneficiary 
                countries or the United States from yarns 
                wholly formed in the United States (including 
                fabrics not formed in one or more CBTPA 
                beneficiary countries), in an amount not 
                exceeding the amount set forth in subclause 
                (II).
                          (II) The amount referred to in 
                        subclause (I) is--
                                  (aa) 250,000,000 square meter 
                                equivalents during the 1-year 
                                period beginning on October 1, 
                                2000, increased by 16 percent, 
                                compounded annually, in each 
                                succeeding 1-year period 
                                through September 30, 2004 and
                                  (bb) in each 1-year period 
                                thereafter through September 
                                30, 2008, the amount in effect 
                                for the 1-year period ending on 
                                September 30, 2004, or such 
                                other amount as may be provided 
                                by law.
                          (III) T-Shirts, other than underwear, 
                        classifiable under subheadings 
                        6109.10.00 and 6109.90.10 of the HTS, 
                        made in one or more CBTPA beneficiary 
                        countries from fabric formed in one or 
                        more CBTPA beneficiary countries from 
                        yarns wholly formed in the United 
                        States, in an amount not exceeding the 
                        amount set forth in subclause (IV).
                          (IV) the amount referred to in 
                        subclause (III) is--
                                  (aa) 4,200,000 dozen during 
                                the 1-year period beginning on 
                                October 1, 2000, increased by 
                                16 percent, compounded 
                                annually, in amount in effect 
                                for the 1-year period ending on 
                                September 30, 2004, or such 
                                other amount as may be provided 
                                by law.
                          (V)It is the sense of the Congress 
                        that the Congress should determine, 
                        based on the record of expansion of 
                        exports from the United States as a 
                        result of the preferential treatment of 
                        articles under this clause, the 
                        percentage by which the amount provided 
                        in subclauses (II) and (IV) should 
                        compounded for the 1-year periods 
                        occurring after the 1-year period 
                        ending on September 30, 2004.
                  (iv) Certain other apparel articles.--(i) 
                Subject to subclause (II), any apparel article 
                classifiable under subheading 6212.10 of the 
                HTS, if the article is both cut and sewn or 
                otherwise assembled in the United States, or 
                one or more of the CBTPA beneficiary countries, 
                or both.
                          (II) During the 1-year period 
                        beginning on October 1, 2001, and 
                        during each of the six succeeding 1-
                        year periods, apparel articles 
                        described in subclause (I) of a 
                        producer or an entity controlling 
                        production shall be eligible for 
                        preferential treatment under 
                        subparagraph (B) only if the aggreagate 
                        cost of fabric components formed in the 
                        United States that are used in the 
                        production of all such articles of that 
                        producer or entity during the preceding 
                        1-year period is at least 75 percent of 
                        the aggregate declared customs value of 
                        the fabric contained in all such 
                        articles of that producer or entity 
                        that are entered during the preceding 
                        1-year period.
                          (III) The United States Customs 
                        Service shall develop and implement 
                        methods and procedures to ensure 
                        ongoing compliance with the requirement 
                        set forth in subclause (II). If the 
                        Customs Service finds that a producer 
                        or an entity controlling production has 
                        not satisfied such requirement in a 1-
                        year period, then apparel articles 
                        described in subclause (I) of that 
                        producer or entity shall be ineligible 
                        for preferential treatment under 
                        subparagraph (B) during any succeeding 
                        1-year period until the aggregate cost 
                        of fabric components formed in the 
                        United States used in the production of 
                        such articles of that producer or 
                        entity in the preceding 1-year period 
                        is at least 85 percent of the aggregate 
                        declared customs value of the fabric 
                        contained in all such articles of that 
                        producer or entity that are entered 
                        during the preceding 1-year period.
                  (v) Apparel articles assembled from fabrics 
                or yarn not widely available in commercial 
                quantities.--(I) Apparel articles that are both 
                cut (or knit-to-shape) and sewn or otherwise 
                assembled in one or more CBTPA beneficiary 
                countries, from fabrics or yarn that is not 
                formed in the United States or in one or more 
                CBTPA beneficiary countries, to the extent that 
                apparel articles of such fabrics or yarn would 
                be eligible for preferential treatment, without 
                regard to the source of the fabrics or yarn, 
                under Annex 401 of the NAFTA.
                          (II) At the request of any interested 
                        party, the President is authorized to 
                        proclaim additional fabrics and yarn as 
                        eligible for preferential treatment 
                        under subclause (I) if--
                                  (aa) the President determines 
                                that such fabrics or yarn 
                                cannot be supplied by the 
                                domestic industry in commercial 
                                quantities in a timely manner;
                                  (bb) the President has 
                                obtained advice regarding the 
                                proposed action from the 
                                appropriate advisory committee 
                                established under section 135 
                                of the Trade Act of 1974 (19 
                                U.S.C. 2155) and the United 
                                States International Trade 
                                Commission;
                                  (cc) within 60 days after the 
                                request, the President has 
                                submitted a report to the 
                                Committee on Ways and Means of 
                                the House of Representatives 
                                and the Committee on Finance of 
                                the Senate that sets forth the 
                                action proposed to be 
                                proclaimed and the reasons for 
                                such actions, and the advice 
                                obtained under division (bb);
                                  (dd) a period of 60 calendar 
                                days, beginning with the first 
                                day on which the President has 
                                met the requirements of 
                                division (cc), has expired; and
                                  (ee) the President has 
                                consulted with such committees 
                                regarding the proposed action 
                                during the period referred to 
                                in division (cc).
                  (vi) Handloomed, handmade, and folklore 
                articles.--A handloomed, handmade, or folklore 
                article of a CBTPA beneficiary country 
                identified under subparagraph (C) that is 
                certified as such by the competent authority of 
                such beneficiary country.
                  (vii) Special rules.--
                          (I) Exception for find
                                  (aa) the President determines 
                                that such fabrics or yarn 
                                cannot be supplied by the 
                                domestic industry in commercial 
                                quantities in a timely manner;
                                  (bb) the President has 
                                obtained advice regarding the 
                                proposed action from the 
                                appropriate advisory committee 
                                established under section 135 
                                of the Trade Act of 1974 (19 
                                U.S.C. 2155) and the United 
                                States International Trade 
                                Commission;
                                  (cc) within 60 days after the 
                                request, the President has 
                                submitted a report to the 
                                Committee on Ways and Means of 
                                the House of Representatives 
                                and the Committee on Finance of 
                                the Senate that sets forth the 
                                action proposed to be 
                                proclaimed and the reasons for 
                                such actions, and the advice 
                                obtained under division (bb);
                                  (dd) a period of 60 calendar 
                                days, beginning with the first 
                                day on which the President has 
                                met the requirements of 
                                division (cc), has expired; and
                                  (ee) the President has 
                                consulted with such committees 
                                regarding the proposed action 
                                during the period referred to 
                                in division (cc).
                  (vi) Handloomed, handmade, and folklore 
                articles.--A handloomed, handmade, or folklore 
                article of a CBTPA beneficiary country 
                identified under subparagraph (C) that is 
                certified as such by the competent authority of 
                such by the competent authority of such 
                beneficiary country.Special rules.--
                          (I) Exception for findings and 
                        trimmings.--(aa) An article otherwise 
                        eligible for preferential treatment 
                        under this paragraph shall not be 
                        ineligible for such treatment because 
                        the article contains findings or 
                        trimmings of foreign origin, if such 
                        findings do not exceed 25 percent of 
                        the cost of the components of the 
                        assembled product. Examples of findings 
                        and trimmings are sewing thread, hooks 
                        and eyes, snaps, buttons, `bow buds', 
                        decorative lace, trim, elastic strips, 
                        zippers, including zipper tapes and 
                        labels, and other similar products. 
                        Elastic strips are considered findings 
                        or trimmings only if they are each less 
                        than 1 inch in width and are used in 
                        the production of brassieres.
                                  (bb) In the case of an 
                                article described in clause 
                                (ii) of this subparagraph, 
                                sewing thread shall not treated 
                                as findings or trimmings under 
                                this subclause.
                          (II) Certain interlining.--(aa) An 
                        article otherwise eligible for 
                        preferential treatment under this 
                        paragraph shall not be ineligible for 
                        such treatment because the article 
                        contains certain interlinnings of 
                        foreign origin, if the value of such 
                        interlinings (and any findings and 
                        trimmings) does not exceed 25 percent 
                        of the cost of the components of the 
                        assembled article.
                                  (bb) Interlinings eligible 
                                for the treatment described in 
                                division (aa) include only a 
                                chest type plate, ``hymo'' 
                                piece, or ``sleeve header'', of 
                                woven or weft-inserted warp 
                                knit construction and of coarse 
                                animal hair or man-made 
                                filaments.
                                  (cc) Thre treatment described 
                                in this subclause shall 
                                terminate if the President 
                                makes a determination that 
                                United States manufacturers are 
                                producing such interlinings in 
                                the United States in commercial 
                                quantities.
                          (III) De minimis rule.--An article 
                        that would otherwise be ineligible for 
                        preferential treatment under this 
                        paragraph because the article contains 
                        fibers or yarns not wholly formed in 
                        the United States or in one or more 
                        CBTPA beneficiary countries shall not 
                        be ineligible for such treatment if the 
                        total weight of all such fibers or 
                        yarns is not more than 7 percent of the 
                        total weight of the good. 
                        Notwithstanding the preceding sentence, 
                        an apparel article containing 
                        elastomeric yarns shall be eligible for 
                        preferential treatment under this 
                        paragraph only if such yarns are wholly 
                        formed in the United States.
                          (IV) Special origin rule.--An article 
                        otherwise eligible for preferential 
                        treatment under clause (i) or (ii) of 
                        this subparagraph shall not be 
                        ineligible for such treatment because 
                        the article contains nylon filament 
                        yarn (other than elastomeric yarn) that 
                        is classifiable under subheading 
                        5402.10.30, 5402.10.60, 5402.31.30, 
                        5402.31.60, 5402.32.30, 5402.41.90, 
                        5402.51.00, or 5402.61.00 of the HTS 
                        duty-free a country that is a party to 
                        an agreement with the United States 
                        establishing a free trade area, which 
                        entered into force before January 1, 
                        1995.
                  (viii) Textile luggage.--Textile luggage--
                          (I) assembled in a CBTPA beneficiary 
                        country from fabric wholly formed and 
                        cut in the United States, from yarns 
                        wholly formed in the United States, 
                        that is entered under subheading 
                        9802.00.80 of the HTS; or
                          (II) assembled from fabric cut in a 
                        CBTPA beneficiary country from fabric 
                        wholly formed in the United States from 
                        yarns wholly formed in the United 
                        States.
          (B) Preferential treatment.--Except as provided in 
        subparagraph (e), during the transition period, the 
        articles to which this subparagraph applies shall enter 
        the United States free of duty and free and any 
        quantitative restrictions, limitations, or consultation 
        levels.
          (C) Handloomed, handmade, and folklore articles.-- 
        for purposes of subparagraph (A)(vi) the President 
        shall consult with representatives of the CBTPA 
        beneficiary countries concerned for the purpose of 
        identifying particular textile and apparel goods that 
        are mutually agreed upon as being handloomed, handmade, 
        or folklore goods of a kind described in section 
        2.3(a), (b), or (c) of the Annex or Appendix 3.1.B.11 
        of the Annex.
          (D)Penalties for transshipment.--
                  (i) Penalties for exporters.--If the 
                President determines, based on sufficient 
                evidence, that an exporter has engaged in 
                transshipment with respect to textile or 
                apparel articles from a CBTPA beneficiary 
                country, then the President shall deny all 
                benefits under this title to such exporter, and 
                any successor of such exporter, for a period of 
                2 years.
                  (ii) Penalties for countries.--Whenever the 
                President finds, based on sufficient evidence, 
                that transshipment has occurred, the President 
                shall request that the CBTPA beneficiary 
                country or countries through whose territory 
                the transshipment has occurred take all 
                necessary and appropriate actions to prevent 
                such transshipment. If the President determines 
                that a country is not taking such actions, the 
                President shall reduce,the quantities of 
                textile and apparel articles that may be 
                imported into the United States from such 
                country by the quantity of the transshipped 
                articles multiplied by 3, to the extent 
                consistent with the obligations of the United 
                States under the WTO.
                  (iii) Transshipment described.transshipment 
                within the meaning of this subparagraph has 
                occurred when preferential treatment under 
                subparagraph (B) has been claimed for a textile 
                or apparel article on the basis of material 
                false information concerning the country of 
                origin, manufacture, processing, or assembly of 
                the article or any of its components. For 
                purposes of this clause, false information is 
                material if disclosure of the true information 
                would mean or would have meant that the article 
                is or was ineligible for preferential treatment 
                under subparagraph (B).
          (E) Bilateral emergency actions.--
                  (i) In general.--The President may take 
                bilateral emergency tariff actions of a kind 
                described in section 4 of the Annex with 
                respect to any apparel article imported from a 
                CBTPA beneficiary country if the application of 
                tariff treatment under subparagraph (B) to such 
                article results in conditions that would be 
                cause for the taking of such actions under such 
                section 4 with respect to a like article 
                described in the same 8-digit subheading of the 
                HTS that is imported from Mexico.
                  (ii) Rules relating to bilateral emergency 
                action.--For purposes of applying bilateral 
                emergency action under this subparagraph--
                          (I) the requirements of paragraph (5) 
                        of section 4 of the Annex (relating to 
                        providing compensation) shall not 
                        apply;
                          (II) the term ``transition period'' 
                        in section 4 of the Annex shall have 
                        the meaning given that term in 
                        paragraph (5)(D) of this subsection; 
                        and
                          (III) the requirements to consult 
                        specified in section 4 of the Annex 
                        shall be treated as satisfied if the 
                        President requests consultations with 
                        the CBTPA beneficiary country in 
                        question and the country does not agree 
                        to consult within the time period 
                        specified under section 4.
                  (3) Transition period treatment of certain 
                other articles originating in beneficiary 
                countries.--
                  (A) Equivalent tariff treatment.--
                          (i) In general.--Subject to clause 
                        (ii), the tariff treatment accorded at 
                        any time during the transition period 
                        to any article referred to in any of 
                        subparagraphs (B) through (F) of 
                        paragraph (1) that is a CBTPA 
                        originating good shall be identical to 
                        the tariff treatment that is accorded 
                        at such time under Annex 302.2 of the 
                        NAFTA to an article described in the 
                        same 8-digit subheading of the HTS that 
                        is a good of Mexico and is imported 
                        into the United States.
                          (ii) Exception.--Clause (1) does not 
                        apply to any article accorded duty-free 
                        treatment under U.S. Note 2(b) to 
                        subchapter 11 of chapter 98 of the HTS.
                  (B) Relationship to subsection (h) duty 
                reductions.--If at any time during the 
                transition period the rate of duty that would 
                (but for action taken under subparagraph (A)(i) 
                in regard to such period) apply with respect to 
                any article under subsection (h) is a rate of 
                duty that is lower than the rate of duty 
                resulting from such action, then such lower 
                rate of duty shall be applied for the purposes 
                of implementing such action.
                  (4) Customs procedures.--
                  (A) In general.--
                          (i) Regulations.--Any importer that 
                        claims preferential treatment under 
                        paragraph (2) or (3) shall comply with 
                        customs procedures similar in all 
                        material respects to the requirements 
                        of Article 502(l) of the NAFTA as 
                        implemented pursuant to United States 
                        law, in accordance with regulations 
                        promulgated by the Secretary of the 
                        Treasury.
                          (ii) Determination.--
                                  (I) In general.--In order to 
                                qualify for the preferential 
                                treatment under paragraph (2) 
                                or (3) and for a Certificate of 
                                Origin to be valid with respect 
                                to any article for which such 
                                treatment is claimed, there 
                                shall be in effect a 
                                determination by the President 
                                that each country described in 
                                subclause (II)--
                                  (aa) has implemented and 
                                follows; or
                                  (bb) is making substantial 
                                progress toward implementing 
                                and following, procedures and 
                                requirements similar in all 
                                material respects to the 
                                relevant procedures and 
                                requirements under chapter 5 of 
                                the NAFTA.
                                  (II) Country described.--A 
                                country is described in this 
                                subclause if it is a CBTPA 
                                beneficiary country--
                                  (aa) from which the article 
                                is exported; or
                                  (bb) in which materials used 
                                in the production of the 
                                article originate or in which 
                                the article or such materials 
                                undergo production that 
                                contributes to a claim that the 
                                article is eligible for 
                                preferential treatment under 
                                paragraph (2) or (3).
                  (B) Certificate of origin.--The Certificate 
                of Origin that otherwise would be required 
                pursuant to the provisions of subparagraph (A) 
                shall not be required in the case of an article 
                imported under paragraph (2) or (3) if such 
                Certificate of Origin would not be required 
                under Article 503 of the NAFTA (asimplemented 
                pursuant to United States law), if the article 
                were imported from Mexico.
                  (C) Report by ustr on cooperation of other 
                countries concerning circumvention.--The United 
                States Commissioner of Customs shall conduct a 
                study analyzing the extent to which each CBTPA 
                beneficiary country--
                          (i) has cooperated fully with the 
                        United States, consistent with its 
                        domestic laws and procedures, in 
                        instances of circumvention or alleged 
                        circumvention of existing quotas on 
                        Imports of textile and apparel goods, 
                        to establish necessary relevant facts 
                        in the places of import, export, and, 
                        where applicable, transshipment, 
                        including investigation of 
                        circumvention practices, exchanges of 
                        documents, correspondence, reports, and 
                        other relevant information, to the 
                        extent such information is available;
                          (ii) has taken appropriate measures, 
                        consistent with its domestic laws and 
                        procedures, against exporters and 
                        importers involved in instances of 
                        false declaration concerning fiber 
                        content, quantities, description, 
                        classification, or origin of textile 
                        and apparel goods; and
                          (iii) has penalized the individuals 
                        and entities involved in any such 
                        circumvention, consistent with its 
                        domestic laws and procedures, and has 
                        worked closely to seek the cooperation 
                        of any third country to prevent such 
                        circumvention from taking place in that 
                        third country. The Trade Representative 
                        shall submit to Congress, not later 
                        than October 1, 2001, a report on the 
                        study conducted under this 
                        subparagraph.
                  (5) Definitions and special rules.--For 
                purposes of this subsection-
                  (A) Annex.--The term ``the Annex'' means 
                Annex 30009B of the NAFTA.
                  (B) CBTPA beneficiary country.--The term 
                ``CBTPA beneficiary country'' means any 
                ``beneficiary country'', as defined in section 
                212(a)(1)(A) of this title, which the President 
                designates as a CBTPA beneficiary country, 
                taking into account the criteria contained in 
                subsections (b) and (c) of section 212 and 
                other appropriate criteria, including the 
                following:
                          (i) Whether the beneficiary country 
                        has demonstrated a commitment to--
                                  (I) undertake its obligations 
                                under the WTO, including those 
                                agreements listed in section 10 
                                1 (d) of the Uruguay Round 
                                Agreements Act, on or ahead of 
                                schedule; and
                                  (II) participate in 
                                negotiations toward the 
                                completion of the FTAA or 
                                another free trade agreement.
                          (ii) The extent to which the country 
                        provides protection of intellectual 
                        property rights consistent with or 
                        greater than the protection afforded 
                        under the Agreement on Trade-Related 
                        Aspects of Intellectual Property Rights 
                        described in section 10 1 (d)(l5) of 
                        the Uruguay Round Agreements Act.
                          (iii) The extent to which the country 
                        provides internationally recognized 
                        worker rights, including--
                                  (I) the right of association;
                                  (II) the right to organize 
                                and bargain collectively;
                                  (III) a prohibition on the 
                                use of any form of forced or 
                                compulsory labor;
                                  (IV) a minimum age for the 
                                employment of children; and
                                  (V) acceptable conditions of 
                                work with respect to minimum 
                                wages, hours of work, and 
                                occupational safety and health;
                          (iv) Whether the country has 
                        implemented its commitments to 
                        eliminate the worst forms of child 
                        labor, as defined in section 507(6) of 
                        the Trade Act of 1974.
                          (v) The extent to which the country 
                        has met the counter-narcotics 
                        certification criteria set forth in 
                        section 490 of the Foreign Assistance 
                        Act of 1961 (22 U.S.C. 2291j) for 
                        eligibility for United States 
                        assistance.
                          (vi) The extent to which the country 
                        has taken steps to become a party to 
                        and implements the Inter-American 
                        Convention Against Corruption.
                          (vii) The extent to which the 
                        country--
                                  (I) applies transparent, 
                                nondiscriminatory, and 
                                competitive procedures in 
                                government procurement 
                                equivalent to those contained 
                                in the Agreement on Government 
                                Procurement described in 
                                section 10 1 (d)(1 7) of the 
                                Uruguay Round Agreements Act; 
                                and
                                  (II) contributes to efforts 
                                in international fora to 
                                develop and implement 
                                international rules in 
                                transparency in government 
                                procurement.
                  (C) CBTPA originating good.--
                          (i) In general.--The term ``CBTPA 
                        originating good'' means a good that 
                        meets the rules of origin for a good 
                        set forth in chapter 4 of the NAFTA as 
                        implemented pursuant to United States 
                        law.
                          (ii) Application of chapter 4.--In 
                        applying chapter 4 of the NAFTA with 
                        respect to a CBTPA beneficiary country 
                        for purposes of this subsection--
                                  (I) no country other than the 
                                United States and a CBTPA 
                                beneficiary country may be 
                                treated as being a party to the 
                                NAFTA;
                                  (II) any reference to trade 
                                between the United States and 
                                Mexico shall be deemed to refer 
                                to trade between the United 
                                States and a CBTPA beneficiary 
                                country;
                                  (III) any reference to a 
                                party shall be deemed to refer 
                                to a CBTPA beneficiary country 
                                or the United States; and from 
                                such action, then such lower 
                                rate of duty shall be applied 
                                for the purposes of 
                                implementing such action.
                                  (IV) any reference to parties 
                                shall be deemed to refer to any 
                                combination of CBTPA 
                                beneficiary countries or to the 
                                United States and one or more 
                                CBTPA beneficiary countries (or 
                                any combination thereof).
                  (D) Transition period.--The term ``transition 
                period'' means, with respect to a CBTPA 
                beneficiary country, the period that begins on 
                October 1, 2000, and ends on the earlier of--
                          (i) September 30, 2008; or
                          (ii) the date on which the FTAA or 
                        another free trade agreement that makes 
                        substantial progress in achieving the 
                        negotiating objectives set forth in 
                        108(b)(5) of Public Law (103-182) (19 
                        U.S.C. 3317(b)(5)) enters into force 
                        with respect to the United States and 
                        the CBTPA beneficiary country.
                  (E) CBTPA.--The term ``CBTPA'' means the 
                Unites States-Caribbean Basin Trade Partnership 
                Act.
                  (F) FTAA.--The term ``FTAA'' means the Free 
                Trade Area of the Americans.
          (c)(1) As used in this subsection--
                  (A) The term ``sugar and beef products'' 
                means--
                          (i) sugars, sirups, and molasses 
                        provided for in subheadings 1701.11.00, 
                        1701.12.00, 1701.91.20, 1701.99.00, 
                        1702.90.30, 1806.10.40, and 2106.90.10 
                        of the Harmonized Tariff Schedule of 
                        the United States, and
                          (ii) articles of beef or veal, 
                        however provided for in chapters 2 and 
                        16 of the Harmonized Tariff Schedule of 
                        the United States.
                  (B) The term ``Plan'' means a stable food 
                production plan that consists of measures and 
                proposals designed to ensure that the present 
                level of food production in, and the 
                nutritional level of the population of, a 
                beneficiary country will not be adversely 
                affected by changes in land use and land 
                ownership that will result if increased 
                production of sugar and beef products is 
                undertaken in response to the duty-free 
                treatment extended under this title to such 
                products. A Plan must specify such facts 
                regarding, and such proposed actions by, a 
                beneficiary country as the President deems 
                necessary for purposes of carrying out this 
                subsection, including but not limited to--
                          (i) the current levels of food 
                        production and nutritional health of 
                        the population;
                          (ii) current level of production and 
                        export of sugar and beef products;
                          (iii) expected increases in 
                        production and export of sugar and beef 
                        products as a result of the duty-free 
                        access to the United States market 
                        provided under this title;
                          (iv) measures to be taken to ensure 
                        that the expanded production of those 
                        products because of such duty-free 
                        access will not occur at the expense of 
                        stable food production; and
                          (v) proposals for a system to monitor 
                        the impact of such duty-free access on 
                        stable food production and land use and 
                        land ownership parterns.
    (2) Duty-free treatment extended under this title to sugar 
and beef products that are the product of a beneficiary country 
shall be suspended by the President under this subsection if--
          (A) the beneficiary country, within the ninety-day 
        period beginning on the date of its designation as such 
        a country under section 212, does not submit a Plan to 
        the President for evaluation;
          (B) on the basis of his evaluation, the President 
        determines that the Plan of a beneficiary country does 
        not meet the criteria set forth in paragraph (1)(B); or
          (C) as a result of the monitoring of the operation of 
        the Plan under paragraph (5), the President determines 
        that a beneficiary country is not making a good faith 
        effort to implement its Plan, or that the measures and 
        proposals in the Plan, although being implemented, are 
        not achieving their purposes.
    (3) Before the President suspends duty-free treatment by 
reason of paragraph (2) (A), (B), or (C) to the sugar and beef 
products of a beneficiary country, he must offer to enter into 
consultation with the beneficiary country for purposes of 
formulating appropriate remedial action which may be taken by 
that country to avoid such suspension. If the beneficiary 
country thereafter enters into consultation within a reasonable 
time and undertakes to formulate remedial action in good faith, 
the President shall withhold the suspension of duty-free 
treatment on the condition that the remedial action agreed upon 
be appropriately implemented by that country.
    (4) The President shall monitor on a biennial basis the 
operation of the Plans implemented by beneficiary countries, 
and shall submit a written report to Congress by March 15 
following the close of each biennium, that--
          (A) specifies the extent to which each Plan, and 
        remedial actions, if any, agreed upon under paragraph 
        (4), have been implemented; and
          (B) evaluates the results of such implementation.
    (5) The President shall terminate any suspension of duty-
free treatment imposed under this subsection if he determines 
that the beneficiary country has taken appropriate action to 
remedy the factors on which the suspension was based.
    (d) Tariff-Rate Quotas.--No quantity of an agricultural 
product subject to a tariff-rate quota that exceeds the in-
quota quantity shall be eligible for duty-free treatment under 
this title.
    (e)(1) The President may by proclamation suspend the duty-
free treatment provided by this title with respect to any 
eligible article and may proclaim a duty rate for such article 
if such action is provided under chapter 1 of title II of the 
Trade Act of 1974 or section 232 of the Trade Expansion Act of 
1962.
    (2) In any report by the International Trade Commission to 
the President under section 201(f) of the Trade Act of 1974 
regarding any article for which duty-free treatment has been 
proclaimed by the President pursuant to this title, the 
Commission shall state whether and to what extent its findings 
and recommendations apply to such article when imported from 
beneficiary countries.
    (3) For purposes of section 2031 of the Trade Act of 1974, 
the suspension of the duty-free treatment provided by this 
title shall be treated as an increase in duty.
    (4) No proclamation which provides solely for a suspension 
referred to in paragraph (3) of this subsection with respect to 
any article shall be taken under section 203 of the Trade Act 
of 1974 unless the United States International Trade 
Commission, in addition to making an affirmative determination 
with respect to such article under section 202(b) of the Trade 
Act of 1974, determines in the course of its investigation 
under such section that the serious injury (or threat thereof) 
substantially caused by imports to the domestic industry 
producing a like or directly competitive article results from 
the duty-free treatment provided by this title.
    (5)(A) Any action taken under section 203 of the Trade Act 
of 1974 that is in effect when duty-free treatment pursuant to 
section 101 of this title is proclaimed shall remain in effect 
until modified or terminated.
    (B) If any article is subject to any such action at the 
time duty-free treatment is proclaimed pursuant to section 211, 
the President may reduce or terminate the application of such 
action to the importation of such article from beneficiary 
countries prior to the otherwise scheduled date on which such 
reduction or termination would occur pursuant to the criteria 
and procedures of section 203 of the Trade Act of 1974.
    (f)(1) If a petition is filed with the International Trade 
Commission pursuant to the provisions of section 201 of the 
Trade Act of 1974 regarding a perishable product and alleging 
injury from imports from beneficiary countries, then the 
petition may also be filed with the Secretary of Agriculture 
with a request that emergency relief be granted pursuant to 
paragraph (3) of this subsection with respect to such article.
    (2) Within fourteen days after the filing of a petition 
under paragraph (1) of this subsection--
          (A) if the Secretary of Agriculture has reason to 
        believe that a perishable product from a beneficiary 
        country is being imported into the United States in 
        such increased quantities as to be a substantial cause 
        of serious injury, or the threat thereof, to the 
        domestic industry producing a perishable product like 
        or directly competitive with the imported product and 
        that emergency action is warranted, he shall advise the 
        President and recommend that the President take 
        emergency action; or
          (B) the Secretary of Agriculture shall publish a 
        notice of his determination not to recommend the 
        imposition of emergency action and so advise the 
        petitioner.
    (3) Within seven days after the President receives a 
recommendation from the Secretary of Agriculture to take 
emergency action pursuant to paragraph (2) of this subsection, 
he shall issue a proclamation withdrawing the duty-free 
treatment provided by this title or publish a notice of his 
determination not to take emergency action.
    (4) The emergency action provided by paragraph (3) of this 
subsection shall cease to apply--
          (A) upon the taking of action under section 203 of 
        the Trade Act of 1974,
          (B) on the day a determination by the President not 
        to take action under section 203 of such Act not to 
        take action becomes final,
          (C) in the event of a report of the United States 
        International Trade Commission containing a negative 
        finding, on the day the Commission's report is 
        submitted to the President, or
          (D) whenever the President determines that because of 
        changed circumstances such relief is no longer 
        warranted.
    (5) For purposes of this subsection, the term ``perishable 
product'' means--
          (A) live plants and fresh cut flowers provided for in 
        chapter 6 of the HTS;
          (B) fresh or chilled vegetables provided for in 
        headings 0701 through 0709 (except subheading 
        0709.52.00) and heading 0714 of the HTS;
          (C) fresh fruit provided for in subheadings 0804.20 
        through 0810.90 (except citrons of subheading 
        0805.90.00, tamarinds and kiwi fruit of subheading 
        0810.90.20, and cashew apples, mameyes colorados, 
        sapodillas, soursops and sweetsops of subheading 
        0810.90.40) of the HTS; and
          (D) concentrated citrus fruit juice provided for in 
        subheadings 2009.11.00, 2009.19.40, 2009.20.40, 
        2009.30.20, and 2009.30.60 of the HTS.
    (g) No proclamation issued pursuant to this title shall 
affect fees imposed pursuant to section 22 of the Agricultural 
Adjustment Act (7 U.S.C. 624).
    (h)(1) Subject to paragraph (2), the President shall 
proclaim reductions in the rates of duty on handbags, luggage, 
flat goods, work gloves, and leather wearing apparel that--
          (A) are the product of any beneficiary country; and
          (B) were not designated on August 5, 1983, as 
        eligible articles for purposes of the generalized 
        system of preferences under title V of the Trade Act of 
        1974.
    (2) The reduction required under paragraph (1) in the rate 
of duty on any article shall--
          (A) result in a rate that is equal to 80 percent of 
        the rate of duty that applies to the article on 
        December 31, 1991, except that, subject to the 
        limitations in paragraph (3), the reduction may not 
        exceed 2.5 percent ad valorem; and
          (B) be implemented in 5 equal annual stages with the 
        first one-fifth of the aggregate reduction in the rate 
        of duty being applied to entries, or withdrawals from 
        warehouse for consumption, of the article on or after 
        January 1, 1992.
    (3) The reduction required under this subsection with 
respect to the rate of duty on any article is in addition to 
any reduction in the rate of duty on that article that may be 
proclaimed by the President as being required or appropriate to 
carry out any trade agreement entered into under the Uruguay 
Round of trade negotiations; except that if the reduction so 
proclaimed--
          (A) is less than 1.5 percent ad valorem, the 
        aggregate of such proclaimed reduction and the 
        reduction under this subsection may not exceed 3.5 
        percent ad valorem, or
          (B) is 1.5 percent ad valorem or greater, the 
        aggregate of such proclaimed reduction and the 
        reduction under this subsection may not exceed the 
        proclaimed reduction plus 1 percent ad valorem.

SEC. 214. MEASURES FOR PUERTO RICO AND UNITED STATES INSULAR 
                    POSSESSIONS.

    [(a) Amendments to general headnote 3(a) to the Tariff 
Schedules of the United States, redesignated as general note 
3(a)(iv) of the HTS, relating to products of insular 
possessions (reprinted elsewhere).]
    (b) Item 813.31 of the TSUS is amended by striking out ``4 
liters'' and inserting in lieu thereof ``5 liters'', and by 
inserting after ``United States,'', ``and not more than 4 
liters of which shall have been produced elsewhere than in such 
insular possessions,''.
    (c) If the sum of the amounts of taxes covered into the 
treasuries of Puerto Rico or the United States Virgin Islands 
pursuant to section 7652(c) of the Internal Revenue Code of 
1986 is reduced below the amount that would have been covered 
over if the imported rum had been produced in Puerto Rico or 
the United States Virgin Islands, then the President shall 
consider compensation measures and, in this regard, may 
withdraw the duty-free treatment on rum provided by this title. 
The President shall submit a report to the Congress on the 
measures he takes.
    (d) Section 1112 of the Trade Agreements Act of 1979 (19 
U.S.C. 2582) is repealed.
    (e) No action pursuant to this title may affect any tariff 
duty imposed by the Legislature of Puerto Rico pursuant to 
section 319 of the Tariff Act of 1930 (19 U.S.C. 1319) on 
coffee imported into Puerto Rico.
    (f) For purposes of chapter 1 of title II of the Trade Act 
of 1974, the term ``industry'' shall include producers located 
in the United States insular possessions.
    (g) Any discharge from a point source in the United States 
Virgin Islands in existence on the date of the enactment of 
this subsection which discharge is attributable to the 
manufacture of rum (as defined in paragraphs (3) of section 
7652(c) of the Internal Revenue Code of 1986) shall not be 
subject to the requirements of section 301 (other than toxic 
discharges), section 306 or section 403 of the Federal Water 
Pollution Control Act if--
          (1) such discharge occurs at least one thousand five 
        hundred feet into the territorial sea from the line of 
        ordinary low water from that portion of the coast which 
        is in direct contact with the sea, and
          (2) the Governor of the United States Virgin Islands 
        determines that such discharge will not interfere with 
        the attainment or maintenance of that water quality 
        which shall assure protection of public water supplies, 
        and the protection and propagation of a balanced 
        population of shellfish, fish, and wildlife, and allow 
        recreational activities, in and on the water and will 
        not result in the discharge of pollutants in quantities 
        which may reasonably be anticipated to pose an 
        unacceptable risk to human health or the environment 
        because of bioaccumulation, persistency in the 
        environment, acute toxicity, chronic toxicity 
        (including carcinogenicity, mutagenicity, or 
        teratogenicity), or synergistic propensities.

SEC. 215. INTERNATIONAL TRADE COMMISSION REPORTS ON IMPACT OF THIS ACT.

    (a) Reporting Requirement.--
    (1) In general.--The United States International Trade 
Commission (in this section referred to as the ``Commission'') 
shall submit to Congress and the President, biennial reports 
regarding the economic impact of this title on United States 
industries and consumers and on the economy of the beneficiary 
countries.
          (2) First report.--The first report shall be 
        submitted not later than September 30, 2001.
          (3) Treatment of Puerto Prico, etc.--For purposes of 
        this section, industries in the Commonwealth of Puerto 
        Rico and the insular possessions of the United States 
        are considered to be United States industries.
    (b)(1) Each report required under subsection (a) shall 
include, but not be limited to, an assessment by the Commission 
regarding--
          (A) the actual effect, during the period covered by 
        the report, of this Act on the United States economy 
        generally as well as on those specific domestic 
        industries which produce articles that are like, or 
        directly competitive with, articles being imported into 
        the United States from beneficiary countries; and
          (B) the probable future effect which this Act will 
        have on the United States economy generally, as well as 
        on such domestic industries, before the provisions of 
        this Act terminate.
    (2) In preparing the assessments required under paragraph 
(1), the Commission shall, to the extent practicable--
          (A) analyze the production, trade and consumption of 
        United States products affected by this Act, taking 
        into consideration employment, profit levels, and use 
        of productive facilities with respect to the domestic 
        industries concerned, and such other economic factors 
        in such industries as it considers relevant, including 
        prices, wages, sales, inventories, patterns of demand, 
        capital investment, obsolescence of equipment, and 
        diversification of production; and
          (B) describe the nature and extent of any significant 
        change in employment, profit levels, and use of 
        productive facilities, and such other conditions as it 
        deems relevant in the domestic industries concerned, 
        which it believes are attributable to this Act.
    (c)(1) Each report required under subsection (a) shall be 
submitted to the Congress and to the President before the close 
of the nine-month period beginning on the day after the last 
day of the period covered by the report.
    (2) The Commission shall provide opportunity for the 
submission by the public, either orally or in writing, or both, 
of information relating to matters that will be addressed in 
the reports.

SEC. 216. IMPACT STUDY BY SECRETARY OF LABOR.

    The Secretary of Labor, in consultation with other 
appropriate Federal agencies, shall undertake a continuing 
review and analysis of the impact which the implementation of 
the provisions of this title have with respect to United States 
labor; and shall make an annual written report to Congress on 
the results of such review and analysis.

SEC. 217. FEASIBILITY STUDY REGARDING A CARIBBEAN TRADE INSTITUTE.

    (a) The Secretary of State shall prepare a study regarding 
the feasibility of establishing a Caribbean Trade Institute in 
Harlem, New York City, supported by a combination of Federal 
and private funds.
    (b) The study shall include, but not be limited to, an 
assessment of the extent to which, and the means by which, a 
Caribbean Trade Institute could--
          (1) facilitate cooperation between public and private 
        entities interested in engaging in or furthering 
        Caribbean trade;
          (2) serve as a catalyst for greater cultural exchange 
        between the United States and Caribbean nations; and
          (3) facilitate expansion of job opportunities both in 
        the United States and the Caribbean Basin.
The study shall also include suggestions regarding the 
organization and staffing of such an institute.
    (c) The study required by this section shall be submitted 
to the Congress within six months after the date of the 
enactment of this Act.

SEC. 218. EFFECTIVE DATE.

    (a) This chapter shall take effect on August 5, 1983.
    [(b) Repealed.]

SEC. 219. CENTER FOR THE STUDY OF WESTERN HEMISPHERIC TRADE.

    (a) Establishment.--The Commissioner of Customs, after 
consultation with appropriate officials in the State of Texas, 
is authorized and directed to make grants to an institution (or 
a consortium of such institutions) to assist such institution 
in planning, establishing, and operating a Center for the Study 
of Western Hemispheric Trade (hereafter in this section 
referred to as the ``Center''). The Commissioner of Customs 
shall make the first grant not later than December 1, 1994, and 
the Center shall be established not later than February 1, 
1995.
    (b) Scope of the Center.--The Center shall be a year-round 
program operated by an institution located in the State of 
Texas (or a consortium of such institutions), the purpose of 
which is to promote and study trade between and among Western 
Hemisphere countries. The Center shall conduct activities 
designed to examine--
          (1) the impact of the NAFTA on the economies in, and 
        trade within, the Western Hemisphere;
          (2) the negotiation of any future free trade 
        agreements, including possible accessions to the NAFTA; 
        and
          (3) adjusting tariffs, reducing nontariff barriers, 
        improving relations among customs officials, and 
        promoting economic relations among countries in the 
        Western Hemisphere.
    (c) Consultation; Selection Criteria.--The Commissioner of 
Customs shall consult with appropriate officials of the State 
of Texas and private sector authorities with respect to 
selecting, planning, and establishing the Center. In selecting 
the appropriate institution, the Commissioner of Customs shall 
give consideration to--
          (1) the institution's ability to carry out the 
        programs and activities described in this section; and
          (2) any resources the institution can provide the 
        Center in addition to Federal funds provided under this 
        program.
    (d) Programs and Activities.--The Center shall conduct the 
following activities:
          (1) Provide forums for international discussion and 
        debate for representatives from countries in the 
        Western Hemisphere regarding issues which affect trade 
        and other economic relations within the hemisphere, 
        including the impact of the NAFTA on individual 
        economies and the desirability and feasibility of 
        possible accessions to the NAFTA by such countries.
          (2) Conduct studies and research projects on subjects 
        which affect Western Hemisphere trade, including 
        tariffs, customs, regional and national economics, 
        business development and finance, production and 
        personnel management, manufacturing, agriculture, 
        engineering, transportation, immigration, 
        telecommunications, medicine, science, urban studies, 
        border demographics, social anthropology, and 
        population.
          (3) Publish materials, disseminate information, and 
        conduct seminars and conferences to support and educate 
        representatives from countries in the Western 
        Hemisphere who seek to do business with or invest in 
        other Western Hemisphere countries.
          (4) Provide grants, fellowships, endowed chairs, and 
        financial assistance to outstanding scholars and 
        authorities from Western Hemisphere countries.
          (5) Provide grants, fellowships, and other financial 
        assistance to qualified graduate students, from Western 
        Hemisphere countries, to study at the Center.
          (6) Implement academic exchange programs and other 
        cooperative research and instructional agreements with 
        the complementary North/South Center at the University 
        of Miami at Coral Gables. (1) Sec. 2(a) of the Dante B. 
        Fascell North-South Center Act (Public Law 106929; 113 
        Stat. 54) provided that any reference in any provisions 
        of law to the North/South Center ``shall be deemed to 
        be a reference to the `Dante B. Fascell North-South 
        Center'.''
    (e) Definitions.--For purposes of this section--
          (1) Nafta.--The term ``NAFTA'' means the North 
        American Free Trade Agreement.
          (2) Western hemisphere countries.--The terms 
        ``Western Hemisphere countries'', ``countries in the 
        Western Hemisphere'', and ``Western Hemisphere'' means 
        Canada, the United States, Mexico, countries located in 
        South America, beneficiary countries (as defined by 
        section 212), the Commonwealth of Puerto Rico, and the 
        United States Virgin Islands.
    (f) Fees for Seminars and Publications.--Notwithstanding 
any other provision of law, a grant made under this section may 
provide that the Center may charge a reasonable fee for 
attendance at seminars and conferences and for copies of 
publications, studies, reports, and other documents the Center 
publishes. The Center may waive such fees in any case in which 
it determines imposing a fee would impose a financial hardship 
and the purposes of the Center would be served by granting such 
a waiver.
    (g) Duration of Grant.--The Commissioner of Customs is 
directed to make grants to any institution or institutions 
selected as the Center for fiscal years 1994, 1995, 1996, and 
1997.
    (h) Report.--The Commissioner of Customs shall, no later 
than July 1, 1994, and annually thereafter for years for which 
grants are made, submit a written report to the Committee on 
Finance of the Senate and the Committee on Ways and Means of 
the House of Representatives. The first report shall include--
          (1) a statement identifying the institution or 
        institutions selected as the Center;
          (2) the reasons for selecting the institution or 
        institutions as the Center; and
          (3) the plan of such institution or institutions for 
        operating the Center.
Each subsequent report shall include information with respect 
to the operations of the Center, the collaboration of the 
Center with, and dissemination of information to, Government 
policymakers and the business community with respect to the 
study of Western Hemispheric trade by the Center, and the plan 
and efforts of the Center to continue operations after grants 
under this section have expired.

                       Subtitle B--Tax Provisions


SEC. 221. PAYMENT OF EXCISE TAXES COLLECTED ON RUM TO PUERTO RICO AND 
                    THE UNITED STATES VIRGIN ISLANDS.

    [Amends section 7652 of the Internal Revenue Code of 1954 
(relating to shipments to the United States) by inserting after 
subsection (b) the following new subsection, applicable to 
articles imported into the United States after June 30, 1983:
    [``(e) Shipments of Rum to the United States.--
          [``(1) Excise taxes on rum covered into treasuries of 
        puerto rico and virgin islands.--All taxes collected 
        under section 5001(a)(1) on rum imported into the 
        United States (less the estimated amount necessary for 
        payment of refunds and drawbacks) shall be covered into 
        the treasuries of Puerto Rico and the Virgin Islands.
          [``(2) Secretary prescribes formula.--The Secretary 
        shall, from time to time, prescribe by regulation a 
        formula for the division of such tax collections 
        between Puerto Rico and the Virgin Islands and the 
        timing and methods for transferring such tax 
        collections.
          [``(3) Rum defined.--For purposes of this subsection, 
        the term `rum' means any article classified under 
        subheading 2208.40.00 of the Harmonized Tariff Schedule 
        of the United States (19 U.S.C. 1202).
          [``(4) Coordination with subsections (a) and (b).--
        Paragraph (1) shall not apply with respect to any rum 
        subject to tax under subsection (a) or (b).''.]

SEC. 222. TREATMENT OF CARIBBEAN CONVENTIONS, ETC.

    [Amends subsection (h) of section 274 of the Internal 
Revenue Code of 1954 (relating to attendance at conventions, 
etc.) by adding at the end thereof the following new paragraph, 
applicable to conventions, seminars, or other meetings 
beginning after June 30, 1983:
          [``(6) Treatment of conventions in certain caribbean 
        countries.--
                  [``(A) In general.--For purposes of this 
                subsection, the term `North American area' 
                includes, with respect to any convention, 
                seminar, or similar meeting, any beneficiary 
                country if (as of the time such meeting 
                begins)--
                          [``(i) there is in effect a bilateral 
                        or multilateral agreement described in 
                        subparagraph (C) between such country 
                        and the United States providing for the 
                        exchange of information between the 
                        United States and such country, and
                          [``(ii) there is not in effect a 
                        finding by the Secretary that the tax 
                        laws of such country discriminate 
                        against conventions held in the United 
                        States.
                  [``(B) Beneficiary country.--For purposes of 
                this paragraph, the term `beneficiary country' 
                has the meaning given to such term by section 
                212(a)(1)(A) of the Caribbean Basin Economic 
                Recovery Act; except that such term shall 
                include Bermuda.
                  [``(C) Authority to conclude exchange of 
                information agreements.--
                          [``(i) In general.--The Secretary is 
                        authorized to negotiate and conclude an 
                        agreement for the exchange of 
                        information with any beneficiary 
                        country. Except as provided in clause 
                        (ii), an exchange of information 
                        agreement shall provide for the 
                        exchange of such information (not 
                        limited to information concerning 
                        nationals or residents of the United 
                        States or the beneficiary country) as 
                        may be necessary or appropriate to 
                        carry out and enforce the tax laws of 
                        the United States and the beneficiary 
                        country (whether criminal or civil 
                        proceedings), including information 
                        which may otherwise be subject to 
                        nondisclosure provisions of the local 
                        law of the beneficiary country such as 
                        provisions respecting bank secrecy and 
                        bearer shares. The exchange of 
                        information agreement shall be 
                        terminable by either country on 
                        reasonable notice and shall provide 
                        that information received by either 
                        country will be disclosed only to 
                        persons or authorities (including 
                        courts and administrative bodies) 
                        involved in the administration or 
                        oversight of, or in the determination 
                        of appeals in respect of, taxes of the 
                        United States or the beneficiary 
                        country and will be used by such 
                        persons or authorities only for such 
                        purposes.
                          [``(ii) Nondisclosure of qualified 
                        confidential information sought for 
                        civil tax purposes.--An exchange of 
                        information agreement need not provide 
                        for the exchange of qualified 
                        confidential information which is 
                        sought only for civil tax purposes if--
                                  [``(I) the Secretary of the 
                                Treasury, after making all 
                                reasonable efforts to negotiate 
                                an agreement which includes the 
                                exchange of such information, 
                                determines that such an 
                                agreement cannot be negotiated 
                                but that the agreement which 
                                was negotiated will 
                                significantly assist in the 
                                administration and enforcement 
                                of the tax laws of the United 
                                States, and
                                  [``(II) the President 
                                determines that the agreement 
                                as negotiated is in the 
                                national security interest of 
                                the United States.
                          [``(iii) Qualified confidential 
                        information defined.--For purposes of 
                        this subparagraph, the term `qualified 
                        confidential information' means 
                        information which is subject to the 
                        nondisclosure provisions of any local 
                        law of the beneficiary country 
                        regarding bank secrecy or ownership of 
                        bearer shares.
                          [``(iv) Civil tax purposes.--For 
                        purposes of this subparagraph, the 
                        determination of whether information is 
                        sought only for civil purposes shall be 
                        made by the requesting party.
                  [``(D) Coordination with section 6103.--Any 
                exchange of information agreement negotiated 
                under subparagraph (C) shall be treated as an 
                income tax convention for purposes of section 
                6103(k)(4).
                  [``(E) Determinations published in the 
                federal register.--The following shall be 
                published in the Federal Register--
                          [``(i) any determination by the 
                        President under subparagraph (C)(ii) 
                        (including the reasons for such 
                        determination),
                          [``(ii) any determination by the 
                        Secretary under subparagraph (C)(ii) 
                        (including the reasons for such 
                        determination), and
                          [``(iii) any finding by the Secretary 
                        under subparagraph (A)(ii) (and any 
                        termination thereof).'']

SEC. 223. REPORT WITH RESPECT TO USE OF CARIBBEAN BASIN TAX HAVENS.

    The Secretary of the Treasury shall, not later than ninety 
days after the date of the enactment of this Act, report to the 
Committee on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate on--
          (1) the level at which Caribbean Basin tax havens are 
        being used to evade or avoid Federal taxes, and the 
        effect on Federal revenues of such use,
          (2) any information he may have on the relationship 
        of such use to drug trafficking and other criminal 
        activities, and
          (3) current antitax haven enforcement activities of 
        the Department of the Treasury.

       Subtitle C--Sense of the Congress Regarding Sugar Imports


SEC. 231. SUGAR IMPORTS.

    It is the sense of the Congress that sugar from any 
Communist country in the Caribbean Basin or in Central America 
should not be imported into the United States.

        Caribbean Basin Economic Recovery Expansion Act of 1990


  [19 U.S.C. 2701-2707, 2701 note, 20 U.S.C. 226, 26 U.S.C. 936; P.L. 
                           101-382; title II]

                  Subtitle A--Short Title and Findings


SEC. 201. SHORT TITLE.

    This title may be cited as the ``Caribbean Basin Economic 
Recovery Expansion Act of 1990''.

SEC. 202. CONGRESSIONAL FINDINGS.

    The Congress finds that--
          (1) a stable political and economic climate in the 
        Caribbean region is necessary for the development of 
        the countries in that region and for the security and 
        economic interests of the United States;
          (2) the Caribbean Basin Economic Recovery Act was 
        enacted in 1983 to assist in the achievement of such a 
        climate by stimulating the development of the export 
        potential of the region; and
          (3) the commitment of the United States to the 
        successful development of the region, as evidenced by 
        the enactment of the Caribbean Basin Economic Recovery 
        Act, should be reaffirmed, and further strengthened, by 
        amending that Act to improve its operation.

Subtitle B--Amendments to the Caribbean Basin Economic Recovery Act and 
                           Related Provisions


[SEC. 211. REPEAL OF TERMINATION DATE ON DUTY-FREE TREATMENT UNDER THE 
                    ACT.

    Repeals section 218 of the Caribbean Basin Economic 
Recovery Act.]

[SEC. 212. DUTY REDUCTION FOR CERTAIN LEATHER-RELATED PRODUCTS.

    Amendments to section 213 of the Caribbean Basin Economic 
Recovery Act providing duty reductions on certain leather-
related products (reprinted elsewhere).]

[SEC. 213. WORKER RIGHTS.

    Amendments to section 212 of the Caribbean Basin Economic 
Recovery Act on worker rights criteria (reprinted elsewhere).]

[SEC. 214. REPORTS.

    Amendments to section 212 of the Caribbean Basin Economic 
Recovery Act requiring reports to the Congress (reprinted 
elsewhere).]

[SEC. 215. TREATMENT OF ARTICLES GROWN, PRODUCED, OR MANUFACTURED IN 
                    PUERTO RICO.

    Amendments to section 213 of the Caribbean Basin Economic 
Recovery Act relating to duty-free treatment for articles of 
Puerto Rico (reprinted elsewhere).]

SEC. 216. APPLICATION OF ACT IN EASTERN CARIBBEAN AREA.

    It is the sense of the Congress that there should be 
undertaken special efforts in order to improve the ability of 
the Organization of Eastern Caribbean States countries and 
Belize to benefit from the Caribbean Basin Economic Recovery 
Act.

[SEC. 221. INCREASE IN DUTY-FREE TOURIST ALLOWANCES.

    Amendments to subchapter IV of chapter 98 of the Harmonized 
Tariff Schedule of the United States to increase duty-free 
tourist allowances.]

[SEC. 222. DUTY-FREE TREATMENT FOR ARTICLES ASSEMBLED IN BENEFICIARY 
                    COUNTRIES FROM COMPONENTS PRODUCED IN THE UNITED 
                    STATES.

    Amendments to U.S. Note 2 of subchapter II of chapter 98 of 
the Harmonized Tariff Schedule of the United States providing 
duty-free treatment for certain imports wholly of U.S. 
components or materials.]

SEC. 223. RULES OF ORIGIN FOR PRODUCTS OF BENEFICIARY COUNTRIES.

    (a) ITC Investigation.--
          (1) The United States International Trade Commission 
        shall immediately undertake, pursuant to section 332(g) 
        of the Tariff Act of 1930, an investigation for the 
        purpose of assessing whether revised rules of origin 
        for products of countries designated as beneficiary 
        countries under the Caribbean Basin Economic Recovery 
        Act are appropriate. If the Commission makes an 
        affirmative assessment, it shall develop recommended 
        revised rules of origin.
          (2) The Commission shall submit a report on the 
        results of the investigation under paragraph (1), 
        together with the text of recommended rules, if any, to 
        the President and the Congress no later than 9 months 
        after the date of the enactment of this Act.
    (b) Legislative Recommendations.--If the President 
considers that the implementation of revised rules of origin 
for products of beneficiary countries would be appropriate, the 
President shall transmit to the Congress suggested legislation 
containing such rules of origin. In formulating such suggested 
legislation, the President shall--
          (1) take into account the report and recommended 
        rules submitted under subsection (a); and
          (2) obtain the advice of--
                  (A) the appropriate advisory committees 
                established under section 135 of the Trade Act 
                of 1974,
                  (B) the governments of the beneficiary 
                countries,
                  (C) the Committee on Ways and Means of the 
                House of Representatives and the Committee on 
                Finance of the Senate, and
                  (D) other interested parties.

[SEC. 224. CUMULATION INVOLVING BENEFICIARY COUNTRY PRODUCTS UNDER THE 
                    COUNTERVAILING DUTY AND ANTIDUMPING DUTY LAWS.

    Amendments to section 771(7) of the Tariff Act of 1930 
relating to cumulation (reprinted elsewhere).]

[SEC. 225. ETHYL ALCOHOL.

    Amendment to section 7(b) of the Steel Trade Liberalization 
Program Implementation Act relating to imports of ethyl 
alcohol.]

[SEC. 226. CONFORMING AMENDMENT.

    Amendment to section 503(b) of the Trade Act of 1974 
relating to rules of origin under the Generalized System of 
Preferences program (reprinted elsewhere).]

SEC. 227. REQUIREMENT FOR INVESTMENT OF SECTION 936 FUNDS IN CARIBBEAN 
                    BASIN COUNTRIES.

    [Amends paragraph (4) of section 936(d) of the Internal 
Revenue Code of 1986 (relating to investment in Caribbean Basin 
countries) by adding at the end thereof the following new 
subparagraph, applicable to calendar years after 1989:
          [``(D) Requirement for investment in caribbean basin 
        countries.--
                  [``(i) In general.--For each calendar year, 
                the government of Puerto Rico shall take such 
                steps as may be necessary to ensure that at 
                least $100,000,000 of qualified Caribbean Basin 
                country investments are made during such 
                calendar year.
                  [``(ii) Qualified caribbean basin country 
                investment.--For purposes of clause (i), the 
                term `qualified Caribbean Basin country 
                investment' means any investment if--
                          [``(I) the income from such 
                        investment is treated as qualified 
                        possession source investment income by 
                        reason of subparagraph (A), and
                          [``(II) such investment is not 
                        (directly or indirectly) a refinancing 
                        of a prior investment (whether or not 
                        such prior investment was a qualified 
                        Caribbean Basin country investment).'']

        Subtitle C--Scholarship Assistance and Tourism Promotion


SEC. 231. COOPERATIVE PUBLIC AND PRIVATE SECTOR PROGRAM FOR PROVIDING 
                    SCHOLARSHIPS TO STUDENTS FROM THE CARIBBEAN AND 
                    CENTRAL AMERICA.

    (a) Statement of Purpose.--It is the purpose of this 
section to encourage the establishment of partnerships between 
State governments, universities, community colleges, and 
businesses to support scholarships for talented socially and 
economically disadvantaged students from eligible countries in 
the Caribbean and Central America to study in the United States 
in order to--
          (1) improve the diversity and quality of educational 
        opportunities for such students;
          (2) assist the development efforts of eligible 
        countries by providing training and educational 
        assistance to persons who can help address the social 
        and economic needs of these countries;
          (3) expand opportunities for cross-cultural studies 
        and exchanges and improve the exchange of understanding 
        and principles of democracy;
          (4) promote positive and productive relationships 
        between the United States and its neighbor countries in 
        the Caribbean and Central American regions;
          (5) give added visibility and focus to the 
        ``scholarship diplomacy'' efforts of the United States 
        Government by leveraging the monies available for this 
        purpose through the development of partnerships among 
        Federal, State, and local governments and the business 
        and academic communities; and
          (6) promote community involvement with the 
        scholarship program as a tool for broadening and 
        strengthening the ``American experience'' for foreign 
        students.
    (b) Establishment of Scholarship Program.--The 
Administrator of the Agency for International Development shall 
establish and administer a program of scholarship assistance, 
in cooperation with State governments, universities, community 
colleges, and businesses, to provide scholarships to enable 
socially and economically disadvantaged students from eligible 
countries in the Caribbean and Central America to study in the 
United States.
    (c) Grants to States.--In carrying out this section, the 
Administrator may make grants to States to provide scholarship 
assistance for undergraduate degree programs and for training 
programs of one year or longer in study areas related to the 
critical development needs of the students' respective 
countries.
    (d) Agreement With States.--The Administrator and each 
participating State shall agree on a program regarding the 
educational opportunities available within the State, the 
selection and assignment of scholarship recipients, and related 
issues. To the maximum extent practicable, each State shall be 
given flexibility in designing its program.
    (e) Federal Share.--The Federal share for each year for 
which a State receives payments under this section shall be not 
less than 50 percent.
    (f) Non-Federal Share.--The non-Federal share of payments 
under this section may be in cash, including the waiver of 
tuition or the offering of in-State tuition or housing waivers 
or subsidies, or in-kind fairly evaluated, including the 
provision of books or supplies.
    (g) Forgiveness of Scholarship Assistance.--The obligation 
of any recipient to reimburse any entity for any or all 
scholarship assistance provided under this section shall be 
forgiven upon the recipient's prompt return to his or her 
country of domicile for a period which is at least one year 
longer than the period spent studying in the United States with 
scholarship assistance.
    (h) Private Sector Participation.--To the maximum extent 
practicable, each participating State shall enlist the 
assistance of the private sector to enable the State to meet 
the non-Federal share of payments under this section. Wherever 
appropriate, each participating State shall encourage the 
private sector to offer internships or other opportunities 
consistent with the purposes of this section to students 
receiving scholarships under this section.
    (i) Funding.--Any funds used in carrying out this section 
shall be derived from funds allocated for Latin American and 
Caribbean regional programs under chapter 4 of part II of the 
Foreign Assistance Act of 1961 (22 U.S.C. 2346 and following; 
relating to the economic support fund).
    (j) Definitions.--As used in this section--
          (1) The term ``eligible country'' means any country--
                  (A) which is receiving assistance under 
                chapter 1 of part I of the Foreign Assistance 
                Act of 1961 (22 U.S.C. 2151 and following; 
                relating to development assistance) or chapter 
                4 of part II of that Act (22 U.S.C. 2346 and 
                following; relating to the economic support 
                fund); and
                  (B) which is designated by the President as a 
                beneficiary country pursuant to the Caribbean 
                Basin Economic Recovery Act.
          (2) The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of 
        Puerto Rico, Guam, American Samoa, the Virgin Islands, 
        the Trust Territory of the Pacific Islands, and the 
        Commonwealth of the Northern Mariana Islands.

SEC. 232. PROMOTION OF TOURISM.

    (a) Congressional Finding.--The Congress finds that the 
tourism industry must be recognized as a central element in the 
economic development and political stability of the Caribbean 
Basin region because of the potential that the industry has for 
increasing employment and foreign exchange earnings, 
establishing important linkages with other related sectors, and 
having a positive complementary effect on trade with the United 
States.
    (b) Federal Agency Priority.--It is the sense of the 
Congress that increased tourism and related activities should 
be developed in the Caribbean Basin region as a central part of 
the Caribbean Basin Initiative program and, to that end, the 
appropriate agencies of the United States Government should 
assign a high priority to projects that promote the tourism 
industry in the Caribbean Basin.
    (c) Study.--The Secretary of Commerce shall complete the 
study begun in 1986 regarding tourism development strategies 
for the Caribbean Basin region. The study shall include--
          (1) information on the mutual benefits received by 
        the United States and the Caribbean Basin economies as 
        a result of tourist activity in the area; and
          (2) proposals for developing increased linkages 
        between the tourism industry and local industries in 
        the region such as the agribusiness.

SEC. 233. PILOT PRECLEARANCE PROGRAM.

    (a) Establishment of Program.--Subject to subsection (b), 
the Commissioner of Customs shall carry out, during fiscal 
years 1991 and 1992, preclearance operations at a facility of 
the United States Customs Service in a country within the 
Caribbean Basin which the Commissioner of Customs considers 
appropriate for testing the extent to which the availability of 
preclearance operations can assist in the development of 
tourism.
    (b) Restrictions Regarding Program.--
          (1) The Commissioner of Customs may not consider a 
        country within the Caribbean Basin to be appropriate 
        for the testing referred to in subsection (a) if 
        preclearance operations are currently carried out by 
        the United States Customs Service in that country.
          (2) Preclearance operations may not be commenced in 
        the country selected for testing under subsection (a) 
        unless the Commissioner of Customs and the Commissioner 
        of Immigration and Naturalization jointly certify 
        that--
                  (A) there exists a bilateral agreement 
                between the United States Government and the 
                government of such country which protects the 
                interests of the United States and affords 
                diplomatic protection to United States 
                employees working at the preclearance location;
                  (B) the facilities at the preclearance 
                location conform to Federal Inspection Services 
                standards and are suitable for the duties to be 
                performed therein;
                  (C) there is adequate security around the 
                structure used for the reception of 
                international arrivals;
                  (D) the government of such country grants the 
                United States Customs Service and the United 
                States Immigration and Naturalization Service 
                appropriate search, seizure, and arrest 
                authority; and
                  (E) United States employees and their 
                families will not be subject to fear of 
                reprisal, acts of terrorism, and threats of 
                intimidation.
          (3) In determining the country in which to establish 
        the operation described in paragraph (1), the 
        Commissioner of Customs and the Commissioner of 
        Immigration and Naturalization shall first determine 
        the viability of establishing such operations in either 
        Aruba or Jamaica. If the Commissioners determine, after 
        full consultation with the governments of such 
        countries, that it is not viable to establish pre-
        clearance operations in either Aruba or Jamaica, they 
        shall so report to the Committee on Finance of the 
        Senate and the Committee on Ways and Means of the House 
        of Representatives, including an explanation of how 
        this determination was reached. Such report shall be 
        submitted to those Committees within six months after 
        the date of the enactment of this Act. Following the 
        submission of such a report, the Commissioners shall 
        take all necessary steps, consistent with the 
        requirements of this section, to establish such 
        operations in another country.
    (c) Report.--As soon as practicable after September 30, 
1992, the Commissioner of Customs shall submit to the Congress 
a report regarding the preclearance operations program carried 
out under subsection (a). The report shall include--
          (1) a summary of the preclearance operations, 
        including the number of individuals processed, any 
        administrative problems encountered, and cost of the 
        operations;
          (2) an evaluation of the extent to which the 
        preclearance operations contributed to--
                  (A) the stimulation of the tourism industry 
                of the country concerned, and
                  (B) expedited customs processing at United 
                States ports of entry;
          (3) the opinion of the Commissioner of Customs 
        regarding the efficacy of extending preclearance 
        operations to other countries within the Caribbean 
        Basin that are developing tourism industries, and if 
        the opinion is affirmative, the identity of those 
        countries to which such operations should be extended 
        and the estimated costs and results of such extensions; 
        and
          (4) such other matters that the Commissioner of 
        Customs considers relevant.

                  Subtitle D--Miscellaneous Provisions


[SEC. 241. TRADE BENEFITS FOR NICARAGUA.

    Authority to designate Nicaragua as a beneficiary 
developing country during 1990.]

SEC. 242. AGRICULTURAL INFRASTRUCTURE SUPPORT.

    It is the sense of Congress that in order to facilitate 
trade with, and the economic development of, the countries 
designated as beneficiary countries under the Caribbean Basin 
Economic Recovery Act, the Secretary of Agriculture should, in 
consultation with the Agribusiness Promotion Council, 
coordinate with the Agency for International Development the 
development of programs to encourage improvements in the 
transportation and cargo handling infrastructure in these 
countries for the purpose of improving agricultural trade 
between these countries and the United States. Such programs 
should focus on improving distribution of agricultural 
commodities and products in these countries, and the 
phytosanitary institutions, quarantine capabilities, and 
pesticide regulations of these countries regarding agricultural 
commodities and products.

[SEC. 243. EXTENSION OF TRADE BENEFITS TO THE ANDEAN REGION.

    Findings and sense of the Congress on providing trade 
benefits to the Andean region.]

  Section 423 of the Tax Reform Act of 1986, as amended (Treatment of 
                       Imports of Ethyl Alcohol)


[19 U.S.C. 2703 note; P.L. 99-514, as amended by P.L. 100-418 and P.L. 
                                101-221]

SEC. 423. ETHYL ALCOHOL AND MIXTURES THEREOF FOR FUEL USE.

    (a) In General.--Except as provided in subsection (b), no 
ethyl alcohol or a mixture thereof may be considered--
          (1) for purposes of general headnote 3(a) of the 
        Tariff Schedules of the United States, to be--
                  (A) the growth or product of an insular 
                possession of the United States,
                  (B) manufactured or produced in an insular 
                possession from materials which are the growth, 
                product, or manufacture of any such possession, 
                or
                  (C) otherwise eligible for exemption from 
                duty under such headnote as the growth or 
                product of an insular possession; or
          (2) for purposes of section 213 of the Caribbean 
        Basin Economic Recovery Act, to be--
                  (A) an article that is wholly the growth, 
                product, or manufacture of a beneficiary 
                country,
                  (B) a new or different article of commerce 
                which has been grown, produced, or manufactured 
                in a beneficiary country,
                  (C) a material produced in a beneficiary 
                country, or
                  (D) otherwise eligible for duty-free 
                treatment under such Act as the growth, 
                product, or manufacture of a beneficiary 
                country;
unless the ethyl alcohol or mixture thereof is an indigenous 
product of that insular possession or beneficiary country.
    (b) Exception.--
          (1) Subject to the limitation in paragraph (2), 
        subsection (a) shall not apply to ethyl alcohol that is 
        imported into the United States during calendar years 
        1987, 1988, and 1989 and produced in--
                  (A) an azeotropic distillation facility 
                located in a beneficiary country, if that 
                facility was established before, and in 
                operation on, July 1, 1987,
                  (B) an azeotropic distillation facility--
                          (i) at least 50 percent of the total 
                        value of the equipment and components 
                        of which were--
                                  (I) produced in the United 
                                States, and
                                  (II) owned by a corporation 
                                at least 50 percent of the 
                                total value of the outstanding 
                                shares of stock of which were 
                                owned by a United States person 
                                (or persons) on or before 
                                January 1, 1986, and
                          (ii) substantially all of the 
                        equipment and components of which were, 
                        on or before January 1, 1986--
                                  (I) located in the United 
                                States under the possession or 
                                control of such corporation,
                                  (II) ready for shipment to, 
                                and installation in, a 
                                beneficiary country or an 
                                insular possession of the 
                                United States, and
                          (iii) which--
                                  (I) has on the date of 
                                enactment of this Act, or
                                  (II) will have at the time 
                                such facility is placed in 
                                service (based on estimates 
                                made before the date of 
                                enactment of this Act),
                        a stated capacity to produce not more 
                        than 42,000,000 gallons of such product 
                        per year, or
                  (C) a distillation facility operated by a 
                corporation which, before the date of enactment 
                of the Omnibus Trade Act of 1987--
                          (i) has completed engineering and 
                        design of a full-scale fermentation 
                        facility in the United States Virgin 
                        Islands, and
                          (ii) has obtained authorization from 
                        authorities of the United States Virgin 
                        Islands to operate a full-scale 
                        fermentation facility.
          (2) The exception provided under paragraph (1) shall 
        cease to apply during each of calendar years 1987, 
        1988, and 1989 to ethyl alcohol produced in a facility 
        described in subparagraph (A), (B), or (C) of paragraph 
        (1) after 20,000,000 gallons of ethyl alcohol produced 
        in that facility are entered into the United States 
        during that year.
    (c) Definitions.--For purposes of this section--
          (1) The term ``ethyl alcohol or a mixture thereof'' 
        means (except for purposes of subsection (e)) ethyl 
        alcohol or any mixture thereof described in item 901.50 
        of the Appendix to the Tariff Schedules of the United 
        States.
          (2) Ethyl alcohol or a mixture thereof that is 
        produced by a process of full fermentation in an 
        insular possession or beneficiary country shall be 
        treated as being an indigenous product of that 
        possession or country.
          (3)(A) Ethyl alcohol and mixtures thereof that are 
        only dehydrated within an insular possession or 
        beneficiary country (hereinafter in this paragraph 
        referred to as ``dehydrated alcohol and mixtures'') 
        shall be treated as being indigenous products of that 
        possession or country only if the alcohol or mixture, 
        when entered, meets the applicable local feedstock 
        requirement.
          (B) The local feedstock requirement with respect to 
        any calendar year is--
                  (i) 0 percent with respect to the base 
                quantity of dehydrated alcohol and mixtures 
                that is entered;
                  (ii) 30 percent with respect to the 
                35,000,000 gallons of dehydrated alcohol and 
                mixtures next entered after the base quantity; 
                and
                  (iii) 50 percent with respect to all 
                dehydrated alcohol and mixtures entered after 
                the amount specified in clause (ii) is entered.
          (C) For purposes of this paragraph:
                  (i) The term ``base quantity'' means, with 
                respect to dehydrated alcohol and mixtures 
                entered during any calendar year, the greater 
                of--
                          (I) 60,000,000 gallons; or
                          (II) an amount (expressed in gallons) 
                        equal to 7 percent of the United States 
                        domestic market for ethyl alcohol, as 
                        determined by the United States 
                        International Trade Commission, during 
                        the 12-month period ending on the 
                        preceding September 30;
                that is first entered during that calendar 
                year.
                  (ii) The term ``local feedstock'' means 
                hydrous ethyl alcohol which is wholly produced 
                or manufactured in any insular possession or 
                beneficiary country.
                  (iii) The term ``local feedstock 
                requirement'' means the minimum percent, by 
                volume, of local feedstock that must be 
                included in dehydrated alcohol and mixtures.
          (4) The term ``beneficiary country'' has the meaning 
        given to such term under section 212 of the Caribbean 
        Basin Economic Recovery Act (19 U.S.C. 2702).
          (5) The term ``United States person'' has the meaning 
        given to such term by section 7701(a)(3) of the 
        Internal Revenue Code of 1986.
          (6) The term ``entered'' means entered, or withdrawn 
        from warehouse, for consumption in the customs 
        territory of the United States.
    (d) Amendment to Appendix to Schedules.--The item 
designation for item 901.50 of the Appendix to the Tariff 
Schedules of the United States is amended to read as follows: 
``Ethyl alcohol (provided for in item 427.88, part 2D, schedule 
4) or any mixture containing such ethyl alcohol (provided for 
in part 1, 2, or 10, schedule 4) if such ethyl alcohol or 
mixture is to be used as fuel or in producing a mixture of 
gasoline and alcohol, a mixture of a special fuel and alcohol, 
or any other mixture to be used as fuel (including motor fuel 
provided for in item 475.25), or is suitable for any such 
uses.''
    (e) Drawbacks.--
          (1) For purposes of subsections (b) and (j)(2) of 
        section 313 of the Tariff Act of 1930 (19 U.S.C. 1313), 
        as amended by section 1888(2) of this Act, any ethyl 
        alcohol (provided for in item 427.88 of the Tariff 
        Schedules of the United States) or mixture containing 
        such ethyl alcohol (provided for in part 1, 2, or 10 of 
        schedule 4 of such Schedules) which is subject to the 
        additional duty imposed by item 901.50 of the Appendix 
        to such Schedules may be treated as being fungible 
        with, or of being of the same kind and quality as, any 
        other imported ethyl alcohol (provided for in item 
        427.88 of such Schedules) or mixture containing such 
        ethyl alcohol (provided for in part 1, 2, or 10 of 
        schedule 4 of such Schedules) only if such other 
        imported ethyl alcohol or mixture thereof is also 
        subject to such additional duty.
          (2) Paragraph (1) shall not apply with respect to 
        ethyl alcohol (provided for in item 427.88 of the 
        Tariff Schedules of the United States) or mixture 
        containing such ethyl alcohol (provided for in part 1, 
        2, or 10 of schedule 4 of such Schedules) that is 
        exempt from the additional duty imposed by item 901.50 
        of the Appendix to such Schedules by reason of--
                  (A) subsection (b), or
                  (B) any agreement entered into under section 
                102(b) of the Trade Act of 1974.
    (f) Conforming Amendments.--
          [(1) Amendment to general note 3(a)(iv) of the 
        Harmonized Tariff Schedule of the United States 
        relating to products of insular possessions.
          [(2) Amendment to section 213(a)(1) of the Caribbean 
        Basin Economic Recovery Act (19 U.S.C. 2703(a)(1) 
        relating to eligible articles.]
          (3) The headnotes to subpart A of part 1 of the 
        Appendix to the Tariff Schedules of the United States 
        are amended by adding at the end thereof the following:
    ``2. For purposes of item 901.50, the phrase `is suitable 
for any such uses' does not include ethyl alcohol (provided for 
in item 427.88, part 2D, schedule 4) that is certified by the 
importer of record to the satisfaction of the Commissioner of 
Customs (hereinafter in this headnote referred to as the 
`Commissioner') to be ethyl alcohol or a mixture containing 
such ethyl alcohol imported for uses other than liquid motor 
fuel use or use in producing liquid motor fuel related 
mixtures. If the importer of record certifies nonliquid motor 
fuel use for purposes of establishing actual use or suitability 
under item 901.50, the Commissioner shall not liquidate the 
entry of ethyl alcohol until he is satisfied that the ethyl 
alcohol has in fact not been used for liquid motor fuel use or 
use in producing liquid motor fuel related mixtures. If he is 
not satisfied within a reasonable period of time not less than 
18 months from the date of entry, then the duties provided for 
in item 901.50 shall be payable retroactive to the date of 
entry. Such duties shall also become payable, retroactive to 
the date of entry, immediately upon the diversion to liquid 
motor fuel use of any ethyl alcohol or ethyl alcohol mixture 
certified upon entry as having been imported for nonliquid 
motor fuel use.''
    (g) Effective Period.--
          (1) The provisions of, and the amendments made by, 
        this section (other than subsection (e)) shall apply to 
        articles entered--
                  (A) after December 31, 1986, and
                  (B) before the expiration of the effective 
                period of item 901.50 of the Appendix to the 
                Tariff Schedules of the United States.
          (2) The provisions of subsection (e) shall take 
        effect on the date of the enactment of this Act.

          General Note 7(a) of the Harmonized Tariff Schedule


Products of Countries Designated as Beneficiary Countries for Pur- 
        poses of the Caribbean Basin Economic Recovery Act (CBERA).

    (a) The following countries and territories or successor 
political entities are designated beneficiary countries for the 
purposes of the CBERA, pursuant to section 212 of that Act (19 
U.S.C. 2702):

    Antigua and Barbuda                 Haiti
    Aruba                               Honduras
    Bahamas                             Jamaica
    Barbados                            Montserrat
    Belize                              Netherlands Antilles
    Costa Rica                          Nicaragua
    Dominica                            Panama
    Dominican Republic                  St. Kitts and Nevis
    El Salvador                         Saint Lucia
    Grenada                             Saint Vincent and the Grenadines
    Guatemala                           Trinidad and Tobago
    Guyana                              Virgin Islands, British

                          E. ANDEAN INITIATIVE


                Andean Trade Preference Act, as amended


      [19 U.S.C. 3201-3202; P.L. 102-182, title II, as amended by 
    P.L. 102-583, P.L. 103-465, and P.L. 104-188, and P.L. 106-200]

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Andean Trade Preference 
Act''.

SEC. 202. AUTHORITY TO GRANT DUTY-FREE TREATMENT.

    The President may proclaim duty-free treatment for all 
eligible articles from any beneficiary country in accordance 
with the provisions of this title.

SEC. 203. BENEFICIARY COUNTRY.

    (a) Definitions.--For purposes of this title--
          (1) The term ``beneficiary country'' means any 
        country listed in subsection (b)(1) with respect to 
        which there is in effect a proclamation by the 
        President designating such country as a beneficiary 
        country for purposes of this title.
          (2) The term ``entered'' means entered, or withdrawn 
        from warehouse for consumption, in the customs 
        territory of the United States.
          (3) The term ``HTS'' means Harmonized Tariff Schedule 
        of the United States.
    (b) Countries Eligible for Designation; Congressional 
Notification.--(1) In designating countries as beneficiary 
countries under this title, the President shall consider only 
the following countries or successor political entities:
          Bolivia
          Ecuador
          Colombia
          Peru.
    (2) Before the President designates any country as a 
beneficiary country for purposes of this title, he shall notify 
the House of Representatives and the Senate of his intention to 
make such designation, together with the considerations 
entering into such decision.
    (c) Limitations on Designation.--The President shall not 
designate any country a beneficiary country under this title--
          (1) if such country is a Communist country;
          (2) if such country--
                  (A) has nationalized, expropriated or 
                otherwise seized ownership or control of 
                property owned by a United States citizen or by 
                a corporation, partnership, or association 
                which is 50 percent or more beneficially owned 
                by United States citizens,
                  (B) has taken steps to repudiate or nullify--
                          (i) any existing contract or 
                        agreement with, or
                          (ii) any patent, trademark, or other 
                        intellectual property of,
                a United States citizen or a corporation, 
                partnership, or association, which is 50 
                percent or more beneficially owned by United 
                States citizens, the effect of which is to 
                nationalize, expropriate, or otherwise seize 
                ownership or control of property so owned, or
                  (C) has imposed or enforced taxes or other 
                exactions, restrictive maintenance or 
                operational conditions, or other measures with 
                respect to property so owned, the effect of 
                which is to nationalize, expropriate, or 
                otherwise seize ownership or control of such 
                property, unless the President determines 
                that--
                          (i) prompt, adequate, and effective 
                        compensation has been or is being made 
                        to such citizen, corporation, 
                        partnership, or association,
                          (ii) good-faith negotiations to 
                        provide prompt, adequate, and effective 
                        compensation under the applicable 
                        provisions of international law are in 
                        progress, or such country is otherwise 
                        taking steps to discharge its 
                        obligations under international law 
                        with respect to such citizen, 
                        corporation, partnership, or 
                        association, or
                          (iii) a dispute involving such 
                        citizen, corporation, partnership, or 
                        association, over compensation for such 
                        a seizure has been submitted to 
                        arbitration under the provisions of the 
                        Convention for the Settlement of 
                        Investment Disputes, or in another 
                        mutually agreed upon forum, and
                promptly furnishes a copy of such determination 
                to the Senate and House of Representatives;
          (3) if such country fails to act in good faith in 
        recognizing as binding or in enforcing arbitral awards 
        in favor of United States citizens or a corporation, 
        partnership, or association which is 50 percent or more 
        beneficially owned by United States citizens, which 
        have been made by arbitrators appointed for each case 
        or by permanent arbitral bodies to which the parties 
        involved have submitted their dispute;
          (4) if such country affords preferential treatment to 
        the products of a developed country, other than the 
        United States, and if such preferential treatment has, 
        or is likely to have, a significant adverse effect on 
        United States commerce, unless the President--
                  (A) has received assurances satisfactory to 
                him that such preferential treatment will be 
                eliminated or that action will be taken to 
                assure that there will be no such significant 
                adverse effect, and
                  (B) reports those assurances to the Congress;
          (5) if a government-owned entity in such country 
        engages in the broadcast of copyrighted material, 
        including films or television material, belonging to 
        United States copyright owners without their express 
        consent or such country fails to work towards the 
        provision of adequate and effective protection of 
        intellectual property rights;
          (6) unless such country is a signatory to a treaty, 
        convention, protocol, or other agreement regarding the 
        extradition of United States citizens; and
          (7) if such country has not or is not taking steps to 
        afford internationally recognized worker rights (as 
        defined in section 507(4) of the Trade Act of 1974) to 
        workers in the country (including any designated zone 
        in that country).
Paragraphs (1), (2), (3), (5), and (7) shall not prevent the 
designation of any country as a beneficiary country under this 
title if the President determines that such designation will be 
in the national economic or security interest of the United 
States and reports such determination to the Congress with his 
reasons therefor.
    (d) Factors Affecting Designation.--In determining whether 
to designate any country a beneficiary country under this 
title, the President shall take into account--
          (1) an expression by such country of its desire to be 
        so designated;
          (2) the economic conditions in such country, the 
        living standards of its inhabitants, and any other 
        economic factors which he deems appropriate;
          (3) the extent to which such country has assured the 
        United States it will provide equitable and reasonable 
        access to the markets and basic commodity resources of 
        such country;
          (4) the degree to which such country follows the 
        accepted rules of international trade provided for 
        under the WTO Agreement and the multilateral trade 
        agreements (as such terms are defined in paragraphs (9) 
        and (4), respectively, of section 2 of the Uruguay 
        Round Agreements Act);
          (5) the degree to which such country uses export 
        subsidies or imposes export performance requirements or 
        local content requirements which distort international 
        trade;
          (6) the degree to which the trade policies of such 
        country as they relate to other beneficiary countries 
        are contributing to the revitalization of the region;
          (7) the degree to which such country is undertaking 
        self-help measures to protect its own economic 
        development;
          (8) whether or not such country has taken or is 
        taking steps to afford to workers in that country 
        (including any designated zone in that country) 
        internationally recognized worker rights;
          (9) the extent to which such country provides under 
        its law adequate and effective means for foreign 
        nationals to secure, exercise, and enforce exclusive 
        rights in intellectual property, including patent, 
        trademark, and copyright rights;
          (10) the extent to which such country prohibits its 
        nationals from engaging in the broadcast of copyrighted 
        material, including films or television material, 
        belonging to United States copyright owners without 
        their express consent;
          (11) whether such country has met the narcotics 
        cooperation certification criteria set forth in section 
        481(h)(2)(A) [deemed to be a reference to section 490 
        of the Foreign Assistance Act of 1991 by section 6(a) 
        of Public Law 102-583] of the Foreign Assistance Act of 
        1961 for eligibility for United States assistance; and
          (12) the extent to which such country is prepared to 
        cooperate with the United States in the administration 
        of the provisions of this Act.
    (e) Withdrawal or Suspension of Designation.--(1) The 
President may--
          (A) withdraw or suspend the designation of any 
        country as a beneficiary country, or
          (B) withdraw, suspend, or limit the application of 
        duty-free treatment under this title to any article of 
        any country,
if, after such designation, the President determines that as a 
result of changed circumstances such a country should be barred 
from designation as a beneficiary country.
    (2)(A) The President shall publish in the Federal Register 
notice of the action the President proposes to take under 
paragraph (1) at least 30 days before taking such action.
    (B) The United States Trade Representative shall, within 
the 30-day period beginning on the date on which the President 
publishes under subparagraph (A) notice of proposed action--
          (i) accept written comments from the public regarding 
        such proposed action,
          (ii) hold a public hearing on such proposed action, 
        and
          (iii) publish in the Federal Register--
                  (I) notice of the time and place of such 
                hearing prior to the hearing, and
                  (II) the time and place at which such written 
                comments will be accepted.
    (f) Report.--On or before the 3rd, 6th, and 9th 
anniversaries of the date of the enactment of this title, the 
President shall submit to the Congress a complete report 
regarding the operation of this title, including the results of 
a general review of beneficiary countries based on the 
considerations described in subsection (c) and (d). In 
reporting on the considerations described in subsection 
(d)(11), the President shall report any evidence that the crop 
eradication and crop substitution efforts of the beneficiary 
are directly related to the effects of this title.

SEC. 204. ELIGIBLE ARTICLES.

    (a) In General.--(1) Unless otherwise excluded from 
eligibility by this title, the duty-free treatment provided 
under this title shall apply to any article which is the 
growth, product, or manufacture of a beneficiary country if--
          (A) that article is imported directly from a 
        beneficiary country into the customs territory of the 
        United States; and
          (B) the sum of--
                  (i) the cost or value of the materials 
                produced in a beneficiary country or 2 or more 
                beneficiary countries under this Act, or a 
                beneficiary country under the Caribbean Basin 
                Economic Recovery Act or 2 or more such 
                countries, plus
                  (ii) the direct costs of processing 
                operations performed in a beneficiary country 
                or countries (under this Act or the Caribbean 
                Basin Economic Recovery Act),
        is not less than 35 percent of the appraised value of 
        such article at the time it is entered.
For purposes of determining the percentage referred to in 
subparagraph (B), the term ``beneficiary country'' includes the 
Commonwealth of Puerto Rico and the United States Virgin 
Islands. If the cost or value of materials produced in the 
customs territory of the United States (other than the 
Commonwealth of Puerto Rico) is included with respect to an 
article to which this paragraph applies, an amount not to 
exceed 15 percent of the appraised value of the article at the 
time it is entered that is attributed to such United States 
cost or value may be applied toward determining the percentage 
referred to in subparagraph (B).
    (2) The Secretary of the Treasury shall prescribe such 
regulations as may be necessary to carry out subsection (a) 
including, but not limited to, regulations providing that, in 
order to be eligible for duty-free treatment under this title, 
an article must be wholly the growth, product, or manufacture 
of a beneficiary country, or must be a new or different article 
of commerce which has been grown, produced, or manufactured in 
the beneficiary country; but no article or material of a 
beneficiary country shall be eligible for such treatment by 
virtue of having merely undergone--
          (A) simple combining or packaging operations, or
          (B) mere dilution with water or mere dilution with 
        another substance that does not materially alter the 
        characteristics of the article.
    (3) As used in this subsection, the phrase ``direct costs 
of processing operations'' includes, but is not limited to--
          (A) all actual labor costs involved in the growth, 
        production, manufacture, or assembly of the specific 
        merchandise, including fringe benefits, on-the-job 
        training and the cost of engineering, supervisory, 
        quality control, and similar personnel; and
          (B) dies, molds, tooling, and depreciation on 
        machinery and equipment which are allocable to the 
        specific merchandise.
Such phrase does not include costs which are not directly 
attributable to the merchandise concerned or are not costs of 
manufacturing the product, such as (i) profit, and (ii) general 
expense of doing business which are either not allocable to the 
specific merchandise or are not related to the growth, 
production, manufacture, or assembly of the merchandise, such 
as administrative salaries, casualty and liability insurance, 
advertising, interest, and salesmen's salaries, commissions or 
expenses.
    (4) If the President, pursuant to section 223 of the 
Caribbean Basin Economic Recovery Expansion Act of 1990, 
considers that the implementation of revised rules of origin 
for products of beneficiary countries designated under the 
Caribbean Basin Economic Recovery Act (19 U.S.C. 2701 et seq.) 
would be appropriate, the President may include similarly 
revised rules of origin for products of beneficiary countries 
designated under this title in any suggested legislation 
transmitted to the Congress that contains such rules of origin 
for products of beneficiary countries under the Caribbean Basin 
Economic Recovery Act.
    (b) Exceptions to Duty-Free Treatment.--The duty free 
treatment provided under this title shall not apply to--
          (1) textile and apparel articles which are subject to 
        textile agreements;
          (2) footwear not designated at the time of the 
        effective date of this Act as eligible for the purpose 
        of the generalized system of preferences under title V 
        of the Trade Act of 1974;
          (3) tuna, prepared or preserved in any manner, in 
        airtight containers;
          (4) petroleum, or any product derived from petroleum, 
        provided for in headings 2709 and 2710 of the HTS;
          (5) watches and watch parts (including cases, 
        bracelets and straps), of whatever type including, but 
        not limited to, mechanical, quartz digital or quartz 
        analog, if such watches or watch parts contain any 
        material which is the product of any country with 
        respect to which HTS column 2 rates of duty apply;
          (6) articles to which reduced rates of duty apply 
        under subsection (c).
          (7) sugars, syrups, and molasses classified in 
        subheadings 1701.11.03, 1701.12.02, 1701.99.02, 
        1702.90.32, 1806.10.42, and 2106.90.12 of the HTS; or
          (8) rum and tafia classified in subheading 2208.40.00 
        of the HTS.
    (c) Duty Reductions for Certain Goods.--(1) Subject to 
paragraph (2), the President shall proclaim reductions in the 
rates of duty on handbags, luggage, flat goods, work gloves, 
and leather wearing apparel that--
          (A) are the product of any beneficiary country; and
          (B) were not designated on August 5, 1993, as 
        eligible articles for purposes of the generalized 
        system of preferences under title V of the Trade Act of 
        1974.
    (2) The reduction required under paragraph (1) in the rate 
of duty on any article shall--
          (A) result in a rate that is equal to 80 percent of 
        the rate of duty that applies to the article on 
        December 31, 1991, except that, subject to the 
        limitations in paragraph (3), the reduction may not 
        exceed 2.5 percent ad valorem; and
          (B) be implemented in 5 equal annual stages with the 
        first \1/5\ of the aggregate reduction in the rate of 
        duty being applied to entries, or withdrawals from 
        warehouse for consumption, of the article on or after 
        January 1, 1992.
    (3) The reduction required under this subsection with 
respect to the rate of duty on any article is in addition to 
any reduction in the rate of duty on that article that may be 
proclaimed by the President as being required or appropriate to 
carry out any trade agreement entered into under the Uruguay 
Round of trade negotiations; except that if the reduction so 
proclaimed--
          (A) is less than 1.5 percent ad valorem, the 
        aggregate of such proclaimed reduction and the 
        reduction under this subsection may not exceed 3.5 
        percent ad valorem, or
          (B) is 1.5 percent ad valorem or greater, the 
        aggregate of such proclaimed reduction and the 
        reduction under this subsection may not exceed the 
        proclaimed reduction plus 1 percent ad valorem.
    (d) Suspension of Duty-Free Treatment.--(1) The President 
may by proclamation suspend the duty-free treatment provided by 
this title with respect to any eligible article and may 
proclaim a duty rate for such article if such action is 
proclaimed under chapter 1 of title II of the Trade Act of 1974 
or section 232 of the Trade Expansion Act of 1962.
    (2) In any report by the United States International Trade 
Commission to the President under section 202(f) of the Trade 
Act of 1974 regarding any article for which duty-free treatment 
has been proclaimed by the President pursuant to this title, 
the Commission shall state whether and to what extent its 
findings and recommendations apply to such article when 
imported from beneficiary countries.
    (3) For purposes of section 203 of the Trade Act of 1974, 
the suspension of the duty-free treatment provided by this 
title shall be treated as an increase in duty.
    (4) No proclamation providing solely for a suspension 
referred to in paragraph (3) of this subsection with respect to 
any article shall be taken under section 203 of the Trade Act 
of 1974 unless the United States International Trade 
Commission, in addition to making an affirmative determination 
with respect to such article under section 202(b) of the Trade 
Act of 1974, determines in the course of its investigation 
under such section that the serious injury (or threat thereof) 
substantially caused by imports to the domestic industry 
producing a like or directly competitive article results from 
the duty-free treatment provided by this title.
    (5)(A) Any action taken under section 203 of the Trade Act 
of 1974 that is in effect when duty-free treatment is 
proclaimed under section 202 of this title shall remain in 
effect until modified or terminated.
    (B) If any article is subject to any such action at the 
time duty-free treatment is proclaimed under section 202 of 
this title, the President may reduce or terminate the 
application of such action to the importation of such article 
from beneficiary countries prior to the otherwise scheduled 
date on which such reduction or termination would occur 
pursuant to the criteria and procedures of section 204 of the 
Trade Act of 1974.
    (e) Emergency Relief With Respect to Perishable Products.--
(1) If a petition is filed with the United States International 
Trade Commission pursuant to the provisions of section 201 of 
the Trade Act of 1974 regarding a perishable product and 
alleging injury from imports from beneficiary countries, then 
the petition may also be filed with the Secretary of 
Agriculture with a request that emergency relief be granted 
pursuant to paragraph (3) of this subsection with respect to 
such article.
    (2) Within 14 days after the filing of a petition under 
paragraph (1) of this subsection--
          (A) if the Secretary of Agriculture has reason to 
        believe that a perishable product from a beneficiary 
        country is being imported into the United States in 
        such increased quantities as to be a substantial cause 
        of serious injury, or the threat thereof, to the 
        domestic industry producing a perishable product like 
        or directly competitive with the imported product and 
        that emergency action is warranted, he shall advise the 
        President and recommend that the President take 
        emergency action; or
          (B) the Secretary of Agriculture shall publish a 
        notice of his determination not to recommend the 
        imposition of emergency action and so advise the 
        petitioner.
    (3) Within 7 days after the President receives a 
recommendation from the Secretary of Agriculture to take 
emergency action pursuant to paragraph (2) of this subsection, 
he shall issue a proclamation withdrawing the duty-free 
treatment provided by this title or publish a notice of his 
determination not to take emergency action.
    (4) The emergency action provided by paragraph (3) of this 
subsection shall cease to apply--
          (A) upon the taking of action under section 203 of 
        the Trade Act of 1974,
          (B) on the day a determination by the President not 
        to take action under section 203(b)(2) of such Act 
        becomes final,
          (C) in the event of a report of the United States 
        International Trade Commission containing a negative 
        finding, on the day of the Commission's report is 
        submitted to the President, or
          (D) whenever the President determines that because of 
        changed circumstances such relief is no longer 
        warranted.
    (5) For purposes of this subsection, the term ``perishable 
product'' means--
          (A) live plants and fresh cut flowers provided for in 
        chapter 6 of the HTS;
          (B) fresh or chilled vegetables provided for in 
        headings 0701 through 0709 (except subheading 
        0709.52.00) and heading 0714 of the HTS;
          (C) fresh fruit provided for in subheadings 0804.20 
        through 0810.90 (except citrons of subheadings 
        0805.90.00, tamarinds and kiwi fruit of subheading 
        0810.90.20, and cashew apples, mameyes colorados, 
        sapodillas, soursops and sweetsops of subheading 
        0810.90.40) of the HTS; or
          (D) concentrated citrus fruit juice provided for in 
        sub- headings 2009.11.00, 2009.19.40, 2009.20.40, 
        2009.30.20, and 2009.30.60 of the HTS.
    (f) Section 22 Fees.--No proclamation issued pursuant to 
this title shall affect fees imposed pursuant to section 22 of 
the Agricultural Adjustment Act of 1933 (7 U.S.C. 624).
    (g) Tariff-Rate Quotas.--No quantity of an agricultural 
product subject to a tariff-rate quota that exceeds the in-
quota quantity shall be eligible for duty-free treatment under 
this Act.

[SEC. 205. RELATED AMENDMENTS.

    [(a) Amendment to Note 4 to subchapter IV of chapter 98 of 
the HTS relating to duty-free tourist allowances.
    [(b) Amendment to general note 3(a)(iv) of the HTS relating 
to products of the insular possessions (reprinted elsewhere).]

SEC. 206. INTERNATIONAL TRADE COMMISSION REPORTS ON IMPACT OF THE 
                    ANDEAN TRADE PREFERENCE ACT.

    (a) Reporting Requirements.--The United States 
International Trade Commission (hereinafter in this section 
referred to as the ``Commission'') shall prepare, and submit to 
the Congress, a report regarding the economic impact of this 
title on United States industries and consumers, and, in 
conjunction with other agencies, the effectiveness of this 
title in promoting drug-related crop eradication and crop 
substitution efforts of the beneficiary countries, during--
          (1) and 24-month period beginning with the date of 
        enactment of this title; and
          (2) each calendar year occurring thereafter until 
        duty-free treatment under this title is terminated 
        under section 208(b).
For purposes of this section, industries in the Commonwealth of 
Puerto Rico and the insular possessions of the United States 
shall be considered to be United States industries.
    (b) Report Requirements.--(1) Each report required under 
subsection (a) shall include, but not be limited to, an 
assessment by the Commission regarding--
          (A) the actual effect, during the period covered by 
        the report, of this title on the United States economy 
        generally as well as on those specific domestic 
        industries which produce articles that are like, or 
        directly competitive with, articles being imported into 
        the United States from beneficiary countries;
          (B) the probable future effect that this title will 
        have on the United States economy generally, as well as 
        on such domestic industries, before the provisions of 
        this title terminate; and
          (C) the estimated effect that this title has had on 
        the drug-related crop eradication and crop substitution 
        efforts of the beneficiary countries.
    (2) In preparing the assessments required under paragraph 
(1), the Commission shall, to the extent practicable--
          (A) analyze the production, trade and consumption of 
        United States products affected by this title, taking 
        into consideration employment, profit levels, and use 
        of productive facilities with respect to the domestic 
        industries concerned, and such other economic factors 
        in such industries as it considers relevant, including 
        prices, wages, sales, inventories, patterns of demand, 
        capital investment, obsolescence of equipment, and 
        diversification of production; and
          (B) describe the nature and extent of any significant 
        change in employment, profit levels, and use of 
        productive facilities, and such other conditions as it 
        deems relevant in the domestic industries concerned, 
        which it believes are attributable to this title.
    (c) Submission Dates; Public Comment.--(1) Each report 
required under subsection (a) shall be submitted to the 
Congress before the close of the 9-month period beginning on 
the day after the last day of the period covered by the report.
    (2) The Commission shall provide an opportunity for the 
submission by the public, either orally or in writing, or both, 
of information relating to matters that will be addressed in 
the reports.

SEC. 207. IMPACT STUDY BY SECRETARY OF LABOR.

    The Secretary of Labor, in consultation with other 
appropriate Federal agencies, shall undertake a continuing 
review and analysis of the impact that the implementation of 
the provisions of this title has with respect to United States 
labor; and shall make an annual written report to Congress on 
the results of such review and analysis.

 SEC. 208. EFFECTIVE DATE AND TERMINATION OF DUTY-FREE TREATMENT.

    (a) Effective Date.--This title shall take effect on the 
date of enactment.
    (b) Termination of Duty-Free Treatment.--No duty-free 
treatment extended to beneficiary countries under this title 
shall remain in effect 10 years after the date of the enactment 
of this title.

                 F. AFRICAN GROWTH AND OPPORTUNITY ACT


                               [Excerpts]


      [19 U.S.C. 2455a; 2466b, 3701-3706, 3722-3723; P.L. 106-200]

   Title I--Extension of Certain Trade Benefits to Sub-Saharan Africa


            Subtitle A--Trade Policy for Sub-Saharan Africa


SEC. 101. SHORT TITLE.

    This title may be cited as the ``African Growth and 
Opportunity Act''.

SEC. 102. FINDINGS.

    Congress finds that--
          (1) it is in the mutual interest of the United States 
        and the countries of sub-Saharan Africa to promote 
        stable and sustainable economic growth and development 
        in sub-Saharan Africa;
          (2) the 48 countries of sub-Saharan Africa form a 
        region richly endowed with both natural and human 
        resources;
          (3) sub-Saharan Africa represents a region of 
        enormous economic potential and of enduring political 
        significance to the United States;
          (4) the region has experienced the strengthening of 
        democracy as countries in sub-Saharan Africa have taken 
        steps to encourage broader participation in the 
        political process;
          (5) certain countries in sub-Saharan Africa have 
        increased their economic growth rates, taken 
        significant steps towards liberalizing their economies, 
        and made progress toward regional economic integration 
        that can have positive benefits for the region;
          (6) despite those gains, the per capita income in 
        sub-Saharan Africa averages approximately $500 
        annually;
          (7) trade and investment, as the American experience 
        has shown, can represent powerful tools both for 
        economic development and for encouraging broader 
        participation in a political process in which political 
        freedom can flourish;
          (8) increased trade and investment flows have the 
        greatest impact in an economic environment in which 
        trading partners eliminate barriers to trade and 
        capital flows and encourage the development of a 
        vibrant private sector that offers individual African 
        citizens the freedom to expand their economic 
        opportunities and provide for their families;
          (9) offering the countries of sub-Saharan Africa 
        enhanced trade preferences will encourage both higher 
        levels of trade and direct investment in support of the 
        positive economic and political developments under way 
        throughout the region; and
          (10) encouraging the reciprocal reduction of trade 
        and investment barriers in Africa will enhance the 
        benefits of trade and investment for the region as well 
        as enhance commercial and political ties between the 
        United States and sub-Saharan Africa.

SEC. 103. STATEMENT OF POLICY.

    Congress supports--
          (1) encouraging increased trade and investment 
        between the United States and sub-Saharan Africa;
          (2) reducing tariff and nontariff barriers and other 
        obstacles to sub-Saharan African and United States 
        trade;
          (3) expanding United States assistance to sub-Saharan 
        Africa's regional integration efforts;
          (4) negotiating reciprocal and mutually beneficial 
        trade agreements, including the possibility of 
        establishing free trade areas that serve the interests 
        of both the United States and the countries of sub-
        Saharan Africa;
          (5) focusing on countries committed to the rule of 
        law, economic reform, and the eradication of poverty;
          (6) strengthening and expanding the private sector in 
        sub-Saharan Africa, especially enterprises owned by 
        women and small businesses;
          (7) facilitating the development of civil societies 
        and political freedom in sub-Saharan Africa,
          (8) establishing a United States-Sub-Saharan Africa 
        Trade and Economic Cooperation Forum; and
          (9) the accession of the countries in sub-Saharan 
        Africa to the Organization for Economic Cooperation and 
        Development (OECD) Convention on Combating Bribery of 
        Foreign Public Officials in International Business 
        Transactions.

SEC. 104. ELIGIBILITY REQUIREMENTS.

    (a) In General.--The President is authorized to designate a 
sub-Saharan African country as an eligible sub-Saharan African 
country if the President determines that the country--
          (1) has established, or is making continual progress 
        toward establishing--
                  (A) a market-based economy that protects 
                private property rights, incorporates an open 
                rules-based trading system, and minimizes 
                government interference in the economy through 
                measures such as price controls, subsidies, and 
                government ownership of economic assets;
                  (B) the rule of law, political pluralism, and 
                the right to due process, a fair trial, and 
                equal protection under the law;
                  (C) the elimination of barriers to United 
                States trade and investment, including by--
                          (i) the provision of national 
                        treatment and measures to create an 
                        environment conducive to domestic and 
                        foreign investment;
                          (ii) the protection of intellectual 
                        property; and
                          (iii) the resolution of bilateral 
                        trade and investment disputes;
                  (D) economic policies to reduce poverty, 
                increase the availability of health care and 
                educational opportunities, expand physical 
                infrastructure, promote the development of 
                private enterprise, and encourage the formation 
                of capital markets through micro-credit or 
                other programs;
                  (E) a system to combat corruption and 
                bribery, such as signing and implementing the 
                Convention on Combating Bribery of Foreign 
                Public Officials in International Business 
                Transactions; and
                  (F) protection of internationally recognized 
                worker rights, including the right of 
                association, the right to organize and bargain 
                collectively, a prohibition on the use of any 
                form of forced or compulsory labor, a minimum 
                age for the employment of children, and 
                acceptable conditions of work with respect to 
                minimum wages, hours of work, and occupational 
                safety and health;
          (2) does not engage in activities that undermine 
        United States national security or foreign policy 
        interests; and
          (3) does not engage in gross violations of 
        internationally recognized human rights or provide 
        support for acts of international terrorism and 
        cooperates in international efforts to eliminate human 
        rights violations and terrorist activities.
    (b) Continuing Compliance.--If the President determines 
that an eligible sub-Saharan African country is not making 
continual progress in meeting the requirements described in 
subsection (a)(1), the President shall terminate the 
designation of the country made pursuant to subsection (a).

SEC. 105. UNITED STATES-SUB-SAHARAN AFRICA TRADE AND ECONOMIC 
                    COOPERATION FORUM.

    (a) Declaration of Policy.--The President shall convene 
annual high-level meetings between appropriate officials of the 
United States Government and officials of the governments of 
sub-Saharan African countries in order to foster close economic 
ties between the United States and sub-Saharan Africa.
    (b) Establishment.--Not later than 12 months after the date 
of the enactment of this Act, the President, after consulting 
with Congress and the governments concerned, shall establish a 
United States-Sub-Saharan Africa Trade and Economic Cooperation 
Forum (in this section referred to as the ``Forum'').
    (c) Requirements.--In creating the Forum, the President 
shall meet the following requirements:
          (1) The President shall direct the Secretary of 
        Commerce, the Secretary of the Treasury, the Secretary 
        of State, and the United States Trade Representative to 
        host the first annual meeting with their counterparts 
        from the governments of sub-Saharan African countries 
        eligible under section 104, and those sub-Saharan 
        African countries that the President determines are 
        taking substantial positive steps towards meeting the 
        eligibility requirements in section 104. The purpose of 
        the meeting shall be to discuss expanding trade and 
        investment relations between the United States and sub-
        Saharan Africa and the implementation of this title 
        including encouraging joint ventures between small and 
        large businesses. The President shall also direct the 
        Secretaries and the United States Trade Representative 
        to invite to the meeting representatives from 
        appropriate sub-Saharan African regional organizations 
        and government officials from other appropriate 
        countries in sub-Saharan Africa.
          (2)(A) The President, in consultation with the 
        Congress, shall encourage United States nongovernmental 
        organizations to host annual meetings with 
        nongovernmental organizations from sub-Saharan Africa 
        in conjunction with the annual meetings of the Forum 
        for the purpose of discussing the issues described in 
        paragraph (1).
          (B) ThePresident, in consultation with the Congress, 
        shall encourage United States representatives of the 
        private sector to host annual meetings with 
        representatives of the private sector from sub-Saharan 
        Africa in conjunction with the annual meetings of the 
        Forum for the purpose of discussing the issues 
        described in paragraph (1).
          (3) The President shall, to the extent practicable, 
        meet with the heads of governments of sub-Saharan 
        African countries eligible under section 104, and those 
        sub-Saharan African countries that the President 
        determines are taking substantial positive steps toward 
        meeting the eligibility requirements in section 104, 
        not less than once every 2 years for the purpose of 
        discussing the issues described in paragraph (1). The 
        first such meeting should take place not later than 12 
        months after the date of the enactment of this Act.
    (d) Dissemination of Information by USIS.--In order to 
assist in carrying out the purposes of the Forum, the United 
States Information Service shall disseminate regularly, through 
multiple media, economic information in support of the free 
market economic reforms described in this title.
    (e) HIV/AIDS Effect on the sub-Saharan African Workforce.--
In selecting issues of common interest to the United States-
Sub-Saharan Africa Trade and Economic Cooperation Forum, the 
President shall instruct the United States delegates to the 
Forum to promote a review by the Forum of the HIV/AIDS epidemic 
in each sub-Saharan African country and the effect of the HIV/
AIDS epidemic on economic development in each country.

SEC. 106. REPORTING REQUIREMENT.

    The President shall submit to the Congress, not later than 
1 year after the date of the enactment of this Act, and 
annually thereafter through 2008, a comprehensive report on the 
trade and investment policy of the United States for sub-
Saharan Africa, and on the implementation of this title and the 
amendments made by this title.

SEC. 107. SUB-SAHARAN AFRICA DEFINED.

    For purposes of this title, the terms ``sub-Saharan 
Africa'', ``sub-Saharan African country'', ``country in sub-
Saharan Africa'', and ``countries in sub-Saharan Africa'' refer 
to the following or any successor political entities:
                                  Republic of Angola (Angola).
                                  Republic of Benin (Benin).
                                  Republic of Botswana 
                                (Botswana).
                                  Burkina Faso (Burkina).
                                  Republic of Burundi 
                                (Burundi).
                                  Republic of Cameroon 
                                (Cameroon).
                                  Republic of Cape Verde (Cape 
                                Verde).
                                  Centreal African Republic.
                                  Republic of Chad (Chad).
                                  Federal Islamic Republic of 
                                the Comoros (Comoros).
                                  Democratic Republic of Congo.
                                  Republic of the Congo 
                                (Congo).
                                  Republic of Cote d'Ivoire 
                                (Cote d'Ivoire).
                                  Republic of Djibouti 
                                (Djibouti).
                                  Republic of Equatorial Guinea 
                                (Equatorial Guinea).
                                  State of Eritrea (Eritrea).
                                  Ethiopia
                                  Gabonese Republic (Gabon).
                                  Republic of the Gambia 
                                (Gambia).
                                  Republic of Ghana (Ghana).
                                  Republic of Guinea (Guinea).
                                  Republic of Guinea-Bissau 
                                (Guinea-Bissau).
                                  Republic of Kenya (Kenya).
                                  Kingdom of Lesotho (Lesotho).
                                  Republic of Liberia 
                                (Liberia).
                                  Republic of Madagascar 
                                (Madagascar).
                                  Republic of Malawi (Malawi).
                                  Republic of Mali (Mali).
                                  Islamic Republic of 
                                Mauritania (Mauritania).
                                  Republic of Mauritius 
                                (Mauritius).
                                  Republic of Mozambique 
                                (Mozambique).
                                  Republic of Namibia 
                                (Namibia).
                                  Republic of Niger (Niger).
                                  Federal Republic of Nigeria 
                                (Nigeria).
                                  Republic of Rwanda (Rwanda).
                                  Democratic Republic of Sao 
                                Tome and Principe (Sam Tome and 
                                Principe).
                                  Republic of Senegal 
                                (Senegal).
                                  Republic of Seychelles 
                                (Seychelles).
                                  Republic of Sierra Leone 
                                (Sierra Leone).
                                  Somalia.
                                  Republic of South Africa 
                                (South Africa).
                                  Republic of Sudan (Sudan).
                                  Kingdom of Swaziland 
                                (Swaziland).
                                  United Republic of Tanzania 
                                (Tanzania).
                                  Republic of Togo (Togo).
                                  Republic of Uganda (Uganda).
                                  Republic of Zambia (Zambia).
                                  Republic of Zimbabwe 
                                (Zimbabwe).

                       Subtitle B--Trade Benefits


SEC. 111. ELIGIBILITY FOR CERTAIN BENEFITS.

 [Adds new section 506A to Title V of the Trade Act of 1974, reprinted 
                               elsewhere]

SEC. 112. TREATMENT OF CERTAIN TEXTILES AND APPAREL.

    (a) Preferential Treatment.--Textile and Apparel article 
described in subsection (b) that are imported directly into the 
customs territory of the United States from a beneficiary sub-
Saharan African country described in section 506A(c) of the 
Trade Act of 1974, shall enter the United States free of duty 
and free of any quantitative limitations in accordance with the 
provisions set forth in subsection (b), if the country has 
satisfied the requirements set forth in section 113.
    (b) Products Covered.--The preferential treatment described 
in subsection (a) shall apply only to the following textile and 
apparel products:
          (1) Apparel articles assembled in beneficiary sub-
        saharan african countries.--Apparel articles assembled 
        in one or more beneficiary sub-Saharan African 
        countries from fabrics wholly formed and cut in the 
        United States, from yarns wholly formed in the United 
        States, (including fabrics not formed from yarns, if 
        such fabrics are classifiable under heading 5602 or 
        5603 of the Harmonized Tariff Schedule of the United 
        States and are wholly formed and cut in the United 
        States) that are--
                  (A) entered under subheading 9802.00.80 of 
                the Harmonized Tariff Schedule of the United 
                States; or
                  (B) entered under chapter 61 or 62 of the 
                Harmonized Tariff Schedule of the United 
                States, if, after such assembly, the articles 
                would have qualified for entry under subheading 
                9802.00.80 of the Harmonized Tariff Schedule of 
                the United States but for the fact that the 
                articles were embroidered or subjected to 
                stone-washing, enzyme-washing, acid washing, 
                perma-pressing, oven-baking, bleaching, 
                garment-dyeing, screen printing, or other 
                similar processes.
          (2) Apparel articles cut and assembled in beneficiary 
        sub-saharan african countries.--Apparel articles cut in 
        one or more beneficiary sub-Saharan African countries 
        from fabric wholly formed in the United States from 
        yarns wholly formed in the United States, (including 
        fabrics not formed from yarns, if such fabrics are 
        classifiable under heading 5602 or 5603 of the 
        Harmonized Tariff Schedule of the United States and are 
        wholly formed in the United States) if such articles 
        are assembled in one or more beneficiary sub-Saharan 
        African countries with thread formed in the United 
        States.
          (3) Apparel articles assembled from regional and 
        other fabric.--Apparel articles wholly assembled in one 
        or more beneficiary sub-Saharan African countries from 
        fabric wholly formed in one or more beneficiary sub-
        Saharan African countries from yarn originating either 
        in the United States or one or more beneficiary sub-
        Saharan African countries (including fabrics not formed 
        from yarns, if such fabrics are classifiable under 
        heading 5602 or 5603 of the Harmonized Tariff Schedule 
        of the United States and are wholly formed and cut in 
        one or more beneficiary sub-Saharan African countries), 
        subject to the following:
                  (A) Limitations on benefits.--
                          (i) In general.--Preferential 
                        treatment under this paragraph shall be 
                        extended in the 1-year period beginning 
                        on October 1, 2000, and in each of the 
                        seven succeeding 1-year periods, to 
                        imports of apparel articles in an 
                        amount not to exceed the applicable 
                        percentage of the aggregate square 
                        meter equivalents of all apparel 
                        articles imported into the United 
                        States in the preceding 12-month period 
                        for which data are available.
                          (ii) Applicable percentage.--For 
                        purposes of this subparagraph, the term 
                        ``applicable percentage'' means 1.5 
                        percent for the 1-year period beginning 
                        October 1, 2000, increased in each of 
                        the seven succeeding 1-year periods by 
                        equal increments, so that for the 
                        period beginning October 1, 2007, the 
                        applicable percentage does not exceed 
                        3.5 percent.
                  (B) Special rule for lesser developed 
                countries.--
                          (i) In general.--Subject to 
                        subparagraph (A), preferential 
                        treatment shall be extended through 
                        September 30, 2004, for apparel 
                        articles wholly assembled in one or 
                        more lesser developed beneficiary sub-
                        Saharan African countries regardless of 
                        the country of origin of the fabric 
                        used to make such articles.
                          (ii) Lesser developed beneficiary 
                        sub-saharan african country.--For 
                        purposes of this subparagraph the term 
                        ``lesser developed beneficiary sub-
                        Saharan African country'' means a 
                        beneficiary sub-Saharan African country 
                        that had a per capita gross national 
                        product of less than $1,500 a year in 
                        1998, as measured by the World Bank.
                  (C) Surge mechanism.--
                          (i) Import monitoring.--The Secretary 
                        of Commerce shall monitor imports of 
                        articles described in this paragraph on 
                        a monthly basis to determine if there 
                        has been a surge in imports of such 
                        articles. In order to permit public 
                        access to preliminary international 
                        trade data and to facilitate the early 
                        identification of potentially 
                        disruptive import surges, the Director 
                        of the Office of Management and Budget 
                        may grant an exception to the 
                        publication dates established for the 
                        release of data on United States 
                        international trade in covered 
                        articles, if the Director notifies 
                        Congress of the early release of the 
                        data.
                          (ii) Determination of damage or 
                        threat thereof.--Whenever the Secretary 
                        of Commerce determines, based on the 
                        data described in clause (i), or 
                        pursuant to a written request made by 
                        an interested party, that there has 
                        been a surge in imports of an article 
                        described in this paragraph from a 
                        beneficiary sub-Saharan African 
                        country, the Secretary shall determine 
                        whether such article from such country 
                        is being imported in such increased 
                        quantities as to cause serious damage, 
                        or threat thereof, to the domestic 
                        industry producing a like or directly 
                        competitive article. If the Secretary's 
                        determination is affirmative, the 
                        President shall suspend the duty-free 
                        treatment provided for such article 
                        under this paragraph. If the inquiry is 
                        initiated at the request of an 
                        interested party, the Secretary shall 
                        make the determination within 60 days 
                        after the date of the request.
                          (iii) Factors to consider.--In 
                        determining whether a domestic industry 
                        has been seriously damaged, or is 
                        threatened with serious damage, the 
                        Secretary shall examine the effect of 
                        the imports on relevant economic 
                        indicators such as domestic production, 
                        sales, market share, capacity 
                        utilization, inventories, employment, 
                        profits, exports, prices, and 
                        investment.
                          (iv) Procedure.--
                                  (I) Initiation.--The 
                                Secretary of Commerce shall 
                                initiate an inquiry within 10 
                                days after receiving a written 
                                request and supporting 
                                information for an inquiry from 
                                an interested party. Notice of 
                                initiation of an inquiry shall 
                                be published in the Federal 
                                Register.
                                  (II) Participation by 
                                interested parties.--The 
                                Secretary of Commerce shall 
                                establish procedures to ensure 
                                participation in the inquiry by 
                                interested parties.
                                  (III) Notice of 
                                determination.--The Secretary 
                                shall publish the determination 
                                described in clause (ii) in the 
                                Federal Register.
                                  (IV) Information available.--
                                If relevant information is not 
                                available on the record or any 
                                party withholds information 
                                that has been requested by the 
                                Secretary, the Secretary shall 
                                make the determination on the 
                                basis of the facts available. 
                                When the Secretary relies on 
                                information submitted in the 
                                inquiry as facts available, the 
                                Secretary shall, to the extent 
                                practicable, corroborate the 
                                information from independent 
                                sources that are reasonably 
                                available to the Secretary.
                          (v) Interested party.--For purposes 
                        of this subparagraph, the term 
                        ``interested party'' means any producer 
                        of a like or directly competitive 
                        article, a certified union or 
                        recognized union or group of workers 
                        which is representative of an industry 
                        engaged in the manufacture, production, 
                        or sale in the United States of a like 
                        or directly competitive article, a 
                        trade or business association 
                        representing producers or sellers of 
                        like or directly competitive articles, 
                        producers engaged in the production of 
                        essential inputs for like or directly 
                        competitive articles, a certified union 
                        or group of workers which is 
                        representative of an industry engaged 
                        in the manufacture, production, or sale 
                        of essential inputs for the like or 
                        directly competitive article, or a 
                        trade or business association 
                        representing companies engaged in the 
                        manufacture, production, or sale of 
                        such essential inputs.
          (4) Sweaters knit-to-shape from cashmere or merino 
        wool.--
                  (A) Cashmere.--Sweaters, in chief weight of 
                cashmere, knit-to-shape in one or more 
                beneficiary sub-Saharan African countries and 
                classifiable under subheading 6110.10 of the 
                Harmonized Tariff Schedule of the United 
                States.
                  (B) Merino wool.--Sweaters, 50 percent or 
                more by weight of wool measuring 18.5 microns 
                in diameter or finer, knit-to-shape in one or 
                more beneficiary sub-Saharan African countries.
          (5) Apparel articles wholly assembled from fabric or 
        yarn not available in commercial quantities in the 
        united states.--
                  (A) In general.--Apparel articles that are 
                both cut (or knit-to-shape) and sewn or 
                otherwise assembled in one or more beneficiary 
                sub-Saharan African countries, from fabric or 
                yarn that is not formed in the United States or 
                a beneficiary sub-Saharan African county, to 
                the extent that apparel articles of such 
                fabrics or yarns would be eligible for 
                preferential treatment, without regard to the 
                source of the fabric or yarn, under Annex 401 
                to the NAFTA.
                  (B) Additional apparel articles.--At the 
                request of any interested party and subject to 
                the following requirements, the President is 
                authorized to proclaim the treatment provided 
                under subparagraph (A) for yarns or fabrics not 
                described in subparagraph (A) if--
                          (i) the President determines that 
                        such yarns or fabrics cannot be 
                        supplied by the domestic industry in 
                        commercial quantities in a timely 
                        manner;
                          (ii) the President has obtained 
                        advice regarding the proposed action 
                        from the appropriate advisory committee 
                        established under section 135 of the 
                        Trade Act of 1974 (19 U.S.C. 2155) and 
                        the United States International Trade 
                        Commission;
                          (iii) within 60 calendar days after 
                        the request, the President has 
                        submitted a report to the Committee on 
                        Ways and Means of the House of 
                        Representatives and the Committee on 
                        Finance of the Senate that sets forth--
                                  (I) the action proposed to be 
                                proclaimed and the reasons for 
                                such action; and
                                  (II) the advice obtained 
                                under clause (ii);
                          (iv) a period of 60 calendar days, 
                        beginning with the first day on which 
                        the President has met the requirements 
                        of subclauses (I) and (II) of clause 
                        (iii), has expired; and
                          (v) the President has consulted with 
                        such committees regarding the proposed 
                        action during the period referred to in 
                        clause (iii).
          (6) Handloomed, handmade, and folklore articles.--A 
        handloomed, handmade, or folklore article of a 
        beneficiary sub-Saharan African country or countries 
        that is certified as such by the competent authority of 
        such beneficiary country or countries. For purposes of 
        this paragraph, the President, after consultation with 
        the beneficiary sub-Saharan African country or 
        countries concerned, shall determine which, if any, 
        particular textile and apparel goods of the country (or 
        countries) shall be treated as being handloomed, 
        handmade, or folklore articles.
    (c) Treatment of Quotas on Textile and Apparel Imports from 
Kenya and Mauritius.--The President shall eliminate the 
existing quotas on textile and apparel articles imported into 
the United States--
          (1) from Kenya within 30 days after that country 
        adopts an effective visa system to prevent unlawful 
        transshipment of textile and apparel articles and the 
        use of counterfeit documents relating to the 
        importation of the articles into the United States; and
          (2) from Mauritius within 30 days after that country 
        adopts such a visa system.
The Customs Service shall provide the necessary technical 
assistance to Kenya and Mauritius in the development and 
implementation of the visa systems.
    (d) Special Rules.--
          (1) Findings and trimmings.--
                  (A) General rule.--An article otherwise 
                eligible for preferential treatment under this 
                section shall not be ineligible for such 
                treatment because the article contains findings 
                or trimmings of foreign origin, if the value of 
                such findings and trimmings do not exceed 25 
                percent of the cost of the components of the 
                assembled article. Examples of findings and 
                trimmings are sewing thread, hooks and eyes, 
                snaps, buttons, ``bow buds'', decorative lace 
                trim, elastic strips, and zippers, including 
                zipper tapes and labels. Elastic strips are 
                considered findings or trimmings only if they 
                are each less than 1 inch in width and used in 
                the production of brassieres.
                  (B) Certain interlinings.--
                          (i) General rule.--An article 
                        otherwise eligible for preferential 
                        treatment under this section shall not 
                        be ineligible for such treatment 
                        because the article contains certain 
                        interlinings of foreign origin, if the 
                        value of such interlinings (and any 
                        findings and trimmings) does not exceed 
                        25 percent of the cost of the 
                        components of the assembled article.
                          (ii) Interlinings described.--
                        Interlinings eligible for the treatment 
                        described in clause (i) include only a 
                        chest type plate, a ``hymo'' piece, or 
                        ``sleeve header'', of woven or weft-
                        inserted warp knit construction and of 
                        coarse animal hair or man-made 
                        filaments.
                          (iii) Termination of treatment.--The 
                        treatment described in this 
                        subparagraph shall terminate if the 
                        President makes a determination that 
                        United States manufacturers are 
                        producing such interlinings in the 
                        United States in commercial quantities.
                  (C) Exception.--In the case of an article 
                described in subsection (b)(2), sewing thread 
                shall not be treated as findings or trimmings 
                under subparagraph (A).
          (2) De minimis rule.--An article otherwise eligible 
        for preferential treatment under this section shall not 
        be ineligible for such treatment because the article 
        contains fibers or yarns not wholly formed in the 
        United States or one or more beneficiary sub-Saharan 
        African countries if the total weight of all such 
        fibers and yarns is not more than 7 percent of the 
        total weight of the article.
    (e) Definitions.--In this section and section 113:
          (1) Agreement on textiles and clothing.--The term 
        ``Agreement on Textiles and Clothing'' means the 
        Agreement on Textiles and Clothing referred to in 
        section 101(d)(4) of the Uruguay Round Agreements Act 
        (19 U.S.C. 3511(d)(4)).
          (2) Beneficiary sub-saharan african country, etc.--
        The terms ``beneficiary sub-Saharan African country'' 
        and ``beneficiary sub-Saharan African countries'' have 
        the same meaning as such terms have under section 
        506A(c) of the Trade Act of 1974.
          (3) NAFTA.--The term ``NAFTA'' means the North 
        American Free Trade Agreement entered into between the 
        United States, Mexico, and Canada on December 17, 1992.
    (f) Effective Date.--This section takes effect on October 
1, 2000, and shall remain in effect through September 30, 2008.

SEC. 113. PROTECTIONS AGAINST TRANSSHIPMENT.

    (a) Preferential Treatment Conditioned on Enforcement 
Measures.--
          (1) In general.--The preferential treatment under 
        section 112(a) shall not be provided to textile and 
        apparel articles that are imported from a beneficiary 
        sub-Saharan African country unless that country--
                  (A) has adopted an effective visa system, 
                domestic laws, and enforcement procedures 
                applicable to covered articles to prevent 
                unlawful transshipment of the articles and the 
                use of counterfeit documents relating to the 
                importation of the articles into the United 
                States;
                  (B) has enacted legislation or promulgated 
                regulations that would permit United States 
                Customs Service verification teams to have the 
                access necessary to investigate thoroughly 
                allegations of transshipment through such 
                country;
                  (C) agrees to report, on a timely basis, at 
                the request of the United States Customs 
                Service, on the total exports from and imports 
                into that country of covered articles, 
                consistent with the manner in which the records 
                are kept by that country;
                  (D) will cooperate fully with the United 
                States to address and take action necessary to 
                prevent circumvention as provided in Article 5 
                of the Agreement on Textiles and Clothing;
                  (E) agrees to require all producers and 
                exporters of covered articles in that country 
                to maintain complete records of the production 
                and the export of covered articles, including 
                materials used in the production, for at least 
                2 years after the production or export (as the 
                case may be); and
                  (F) agrees to report, on a timely basis, at 
                the request of the United States Customs 
                Service, documentation establishing the country 
                of origin of covered articles as used by that 
                country in implementing an effective visa 
                system.
          (2) Country of origin documentation.--For purposes of 
        paragraph (1)(F), documentation regarding the country 
        of origin of the covered articles includes 
        documentation such as production records, information 
        relating to the place of production, the number and 
        identification of the types of machinery used in 
        production, the number of workers employed in 
        production, and certification from both the 
        manufacturer and the exporter.
    (b) Customs Procedures and Enforcement.--
          (1) In general.--
                  (A) Regulations.--Any importer that claims 
                preferential treatment under section 112 shall 
                comply with customs procedures similar in all 
                material respects to the requirements of 
                Article 502(1) of the NAFTA as implemented 
                pursuant to United States law, in accordance 
                with regulations promulgated by the Secretary 
                of the Treasury.
                  (B) Determination.--
                          (i) In general.--In order to qualify 
                        for the preferential treatment under 
                        section 112 and for a Certificate of 
                        Origin to be valid with respect to any 
                        article for which such treatment is 
                        claimed, there shall be in effect a 
                        determination by the President that 
                        each country described in clause (ii)--
                                  (I) has implemented and 
                                follows: or
                                  (II) is making substantial 
                                progress toward implementing 
                                and following, procedures and 
                                requirements similar in all 
                                material respects to the 
                                relevant procedures and 
                                requirements under chapter 5 of 
                                the NAFTA.
                          (ii) Country described.--A country is 
                        described in this clause if it is a 
                        beneficiary sub-Saharan African 
                        country--
                                  (I) from which the article is 
                                exported; or
                                  (II) in which materials used 
                                in the production of the 
                                article originate or in which 
                                the article or such materials, 
                                undergo production that 
                                contributes to a claim that the 
                                article is eligible for 
                                preferential treatment.
          (2) Certificate of origin.--The Certificate of Origin 
        that otherwise would be required pursuant to the 
        provisions of paragraph (1) shall not be required in 
        the case of an article imported under section 112 if 
        such Certificate of Origin would not be required under 
        Article 503 of the NAFTA (as implemented pursuant to 
        United States law), if the article were imported from 
        Mexico.
          (3) Penalties for exporters.--If the President 
        determines, based on sufficient evidence, that an 
        exporter has engaged in transshipment as defined in 
        paragraph (4), then the President shall deny for a 
        period of 5 years all benefits under section 112 to 
        such exporter, any successor of such exporter, and any 
        other entity owned or operated by the principal of the 
        exporter.
          (4) Transshipment described.--Transshipment within 
        the meaning of this subsection has occurred when 
        preferential treatment for a textile or apparel article 
        under this Act has been claimed on the basis of 
        material false information concerning the country of 
        origin, manufacture, processing, or assembly of the 
        article or any of its components. For purposes of this 
        paragraph, false information is material if disclosure 
        of the true information would mean or would have meant 
        that the article is or was ineligible for preferential 
        treatment under section 112.
          (5) Monitoring and reports to congress.--The Customs 
        Service shall monitor and the Commissioner of Customs 
        shall submit to Congress, not later than March 31 of 
        each year, a report on the effectiveness of the visa 
        systems and the implementation of legislation and 
        regulations described in subsection (a) and on measures 
        taken by countries in sub-Saharan Africa which export 
        textiles or apparel to the United States to prevent 
        circumvention as described in article 5 of the 
        Agreement on Textiles and Clothing.
    (c) Customs Service Enforcement.--The Customs Service 
shall--
          (1) make available technical assistance to the 
        beneficiary sub-Saharan African countries--
                  (A) in the development and implementation of 
                visa systems, legislation, and regulations 
                described in subsection (a)(1)(A); and
                  (B) to train their officials in anti-
                transshipment enforcement;
          (2) send production verification teams to at least 
        four beneficiary sub-Saharan African countries each 
        year; and
          (3) to the extent feasible, place beneficiary sub-
        Saharan African countries on the Electronic Visa 
        (ELVIS) program.
    (d) Authorization of Appropriations.--There is authorized 
to be appropriated to carry out subsection (c) the sum of 
$5,894,913.

SEC. 114. TERMINATION.

 [Adds new section 506B to Title V of the Trade Act of 1974, reprinted 
                               elsewhere]

[SEC. 115. CLERICAL AMENDMENTS.]

SEC. 116. FREE TRADE AGREEMENTS WITH SUB-SAHARAN AFRICAN COUNTRIES.

    (a) Declaration of Policy.--Congress declares that free 
trade agreements should be negotiated, where feasible, with 
interested countries in sub-Saharan Africa, in order to serve 
as the catalyst for increasing trade between the United States 
and sub-Saharan Africa and increasing private sector investment 
in sub-Saharan Africa.
    (b) Plan Requirement.--
          (1) In general.--The President, taking into account 
        the provisions of the treaty establishing the African 
        Economic Community and the willingness of the 
        governments of sub-Saharan African countries to engage 
        in negotiations to enter into free trade agreements, 
        shall develop a plan for the purpose of negotiating and 
        entering into one or more trade agreements with 
        interested beneficiary sub-Saharan African countries.
          (2) Elements of Plan.--The plan shall include the 
        following:
                  (A) The specific objectives of the United 
                States with respect to negotiations described 
                in paragraph (1) and a suggested timetable for 
                achieving those objectives.
                  (B) The benefits to both the United States 
                and the relevant sub-Saharan African countries 
                with respect to the applicable free trade 
                agreement or agreements.
                  (C) A mutually agreed-upon timetable for the 
                negotiations.
                  (D) The implications for and the role of 
                regional and sub-regional organizations in sub-
                Saharan Africa with respect to such free trade 
                agreement or agreements.
                  (E) Subject matter anticipated to be covered 
                by the negotiations and United States laws, 
                programs, and policies, as well as the laws of 
                participating eligible African countries and 
                existing bilateral and multilateral and 
                economic cooperation and trade agreements, that 
                may be affected by the agreement or agreements.
                  (F) Procedures to ensure the following:
                          (i) Adequate consultation with the 
                        Congress and the private sector during 
                        the negotiations.
                          (ii) Consultation with the Congress 
                        regarding all matters relating to 
                        implementation of the agreement or 
                        agreements.
                          (iii) Approval by the Congress of the 
                        agreement or agreements.
                          (iv) Adequate consultations with the 
                        relevant African governments and 
                        African regional and subregional 
                        intergovernmental organizations during 
                        the negotiation of the agreement or 
                        agreements.
    (c) Reporting Requirement.--Not later than 12 months after 
the date of the enactment of this Act, the President shall 
prepare and transmit to the Congress a report containing the 
plan developed pursuant to subsection (b).

                          G. CUSTOMS VALUATION


           Section 402 of the Tariff Act of 1930, as amended


  [19 U.S.C. 1401a; P.L. 71-361, as amended by P.L. 96-39 and P.L. 96-
                                  490]

SEC. 402. VALUE.

    (a) In General.--(1) Except as otherwise specifically 
provided for in this Act, imported merchandise shall be 
appraised, for the purposes of this Act, on the basis of the 
following:
          (A) The transaction value provided for under 
        subsection (b).
          (B) The transaction value of identical merchandise 
        provided for under subsection (c), if the value 
        referred to in subparagraph (A) cannot be determined, 
        or can be determined but cannot be used by reason of 
        subsection (b)(2).
          (C) The transaction value of similar merchandise 
        provided for under subsection (c), if the value 
        referred to in subparagraph (B) cannot be determined.
          (D) The deductive value provided for under subsection 
        (d), if the value referred to in subparagraph (C) 
        cannot be determined and if the importer does not 
        request alternative valuation under paragraph (2).
          (E) The computed value provided for under subsection 
        (e), if the value referred to in subparagraph (D) 
        cannot be determined.
          (F) The value provided for under subsection (f), if 
        the value referred to in subparagraph (E) cannot be 
        determined.
    (2) If the value referred to in paragraph (1)(C) cannot be 
determined with respect to imported merchandise, the 
merchandise shall be appraised on the basis of the computed 
value provided for under paragraph (1)(E), rather than the 
deductive value provided for under paragraph (1)(D), if the 
importer makes a request to that effect to the customs officer 
concerned within such time as the Secretary shall prescribe. If 
the computed value of the merchandise cannot subsequently be 
determined, the merchandise may not be appraised on the basis 
of the value referred to in paragraph (1)(F) unless the 
deductive value of the merchandise cannot be determined under 
paragraph (1)(D).
    (3) Upon written request therefor by the importer of 
merchandise, and subject to provisions of law regarding the 
disclosure of information, the customs officer concerned shall 
provide the importer with a written explanation of how the 
value of that merchandise was determined under this section.
    (b) Transaction Value of Imported Merchandise.--(1) The 
transaction value of imported merchandise is the price actually 
paid or payable for the merchandise when sold for exportation 
to the United States, plus amounts equal to--
          (A) the packing costs incurred by the buyer with 
        respect to the imported merchandise;
          (B) any selling commission incurred by the buyer with 
        respect to the imported merchandise;
          (C) the value, apportioned as appropriate, of any 
        assist;
          (D) any royalty or license fee related to the 
        imported merchandise that the buyer is required to pay, 
        directly or indirectly, as a condition of the sale of 
        the imported merchandise for exportation to the United 
        States; and
          (E) the proceeds of any subsequent resale, disposal, 
        or use of the imported merchandise that accrue, 
        directly or indirectly, to the seller.
The price actually paid or payable for imported merchandise 
shall be increased by the amounts attributable to the items 
(and no others) described in subparagraphs (A) through (E) only 
to the extent that each such amount (i) is not otherwise 
included within the price actually paid or payable; and (ii) is 
based on sufficient information. If sufficient information is 
not available, for any reason, with respect to any amount 
referred to in the preceding sentence, the transaction value of 
the imported merchandise concerned shall be treated, for 
purposes of this section, as one that cannot be determined.
    (2)(A) The transaction value of imported merchandise 
determined under paragraph (1) shall be the appraised value of 
that merchandise for the purposes of this Act only if--
          (i) there are not restrictions on the disposition or 
        use of the imported merchandise by the buyer other than 
        restrictions that--
                  (I) are imposed or required by law,
                  (II) limit the geographical area in which the 
                merchandise may be resold, or
                  (III) do not substantially affect the value 
                of the merchandise;
          (ii) the sale of, or the price actually paid or 
        payable for, the imported merchandise is not subject to 
        any condition or consideration for which a value cannot 
        be determined with respect to the imported merchandise;
          (iii) no part of the proceeds of any subsequent 
        resale, disposal, or use of the imported merchandise by 
        the buyer will accrue directly or indirectly to the 
        seller, unless an appropriate adjustment therefor can 
        be made under paragraph (1)(E); and
          (iv) the buyer and seller are not related, or the 
        buyer and seller are related but the transaction value 
        is acceptable, for purposes of this subsection, under 
        subparagraph (B).
    (B) The transaction value between a related buyer and 
seller is acceptable for the purposes of this subsection if an 
examination of the circumstances of the sale of the imported 
merchandise indicates that the relationship between such buyer 
and seller did not influence the price actually paid or 
payable; or if the transaction value of the imported 
merchandise closely approximates--
          (i) the transaction value of identical merchandise, 
        or of similar merchandise, in sales to unrelated buyers 
        in the United States; or
          (ii) the deductive value or computed value for 
        identical merchandise or similar merchandise;
but only if each value referred to in clause (i) or (ii) that 
is used for comparison relates to merchandise that was exported 
to the United States at or about the same time as the imported 
merchandise.
    (C) In applying the values used for comparison purposes 
under subparagraph (B), there shall be taken into account 
differences with respect to the sales involved (if such 
differences are based on sufficient information whether 
supplied by the buyer or otherwise available to the customs 
officer concerned) in--
          (i) commercial levels;
          (ii) quantity levels;
          (iii) the costs, commissions, values, fees, and 
        proceeds described in paragraph (1); and
          (iv) the costs incurred by the seller in sales in 
        which he and the buyer are not related that are not 
        incurred by the seller in sales in which he and the 
        buyer are related.
    (3) The transaction value of imported merchandise does not 
include any of the following, if identified separately from the 
price actually paid or payable and from any cost or other item 
referred to in paragraph (1):
          (A) Any reasonable cost or charge that is incurred 
        for--
                  (i) the construction, erection, assembly, or 
                maintenance of, or the technical assistance 
                provided with respect to, the merchandise after 
                its importation into the United States; or
                  (ii) the transportation of the merchandise 
                after such importation.
          (B) The customs duties and other Federal taxes 
        currently payable on the imported merchandise by reason 
        of its importation, and any Federal excise tax on, or 
        measured by the value of such merchandise for which 
        vendors in the United States are ordinarily liable.
    (4) For purposes of this subsection--
          (A) The term ``price actually paid or payable'' means 
        the total payment (whether direct or indirect, and 
        exclusive of any costs, charges, or expenses incured 
        for transportation, insurance, and related services 
        incident to the international shipment of the 
        merchandise from the country of exportation to the 
        place of importation in the United States) made, or to 
        be made, for imported merchandise by the buyer to, or 
        for the benefit of, the seller.
          (B) Any rebate of, or other decrease in, the price 
        actually paid or payable that is made or otherwise 
        effected between the buyer and the seller after the 
        date of the importation of the merchandise into the 
        United States shall be disregarded in determining the 
        transaction value under paragraph (1).
    (c) Transaction Value of Identical Merchandise and Similar 
Merchandise.--(1) The transaction value of identical 
merchandise, or of similar merchandise, is the transaction 
value (acceptable as the appraised value for purposes of this 
Act under subsection (b) but adjusted under paragraph (2) of 
this subsection) of imported merchandise that is--
          (A) with respect to the merchandise being appraised, 
        either identical merchandise or similar merchandise, as 
        the case may be; and
          (B) exported to the United States at or about the 
        time that the merchandise being appraised is exported 
        to the United States.
    (2) Transaction values determined under this subsection 
shall be based on sales of identical merchandise or similar 
merchandise, as the case may be, at the same commercial level 
and in substantially the same quantity as the sales of the 
merchandise being appraised. If no such sale is found, sales of 
identical merchandise or similar merchandise at either a 
different commercial level or in different quantities, or both, 
shall be used, but adjusted to take account of any such 
difference. Any adjustment made under this paragraph shall be 
based on sufficient information. If in applying this paragraph 
with respect to any imported merchandise, two or more 
transaction values for identical merchandise, or for similar 
merchandise, are determined, such imported merchandise shall be 
appraised on the basis of the lower or lowest of such values.
    (d) Deductive Value.--(1) For purposes of this subsection, 
the term ``merchandise concerned'' means the merchandise being 
appraised, identical merchandise, or similar merchandise.
    (2)(A) The deductive value of the merchandise being 
appraised is whichever of the following prices (as adjusted 
under paragraph (3)) is appropriate depending upon when and in 
what condition the merchandise concerned is sold in the United 
States:
          (i) If the merchandise concerned is sold in the 
        condition as imported at or about the date of 
        importation of the merchandise being appraised, the 
        price is the unit price at which the merchandise 
        concerned is sold in the greatest aggregate quantity at 
        or about such date.
          (ii) If the merchandise concerned is sold in the 
        condition as imported but not sold at or about the date 
        of importation of the merchandise being appraised, the 
        price is the unit price at which the merchandise 
        concerned is sold in the greatest aggregate quantity 
        after the date of importation of the merchandise being 
        appraised but before the close of the 90th day after 
        the date of such importation.
          (iii) If the merchandise concerned was not sold in 
        the condition as imported and not sold before the close 
        of the 90th day after the date of importation of the 
        merchandise being appraised, the price is the unit 
        price at which the merchandise being appraised, after 
        further processing, is sold in the greatest aggregate 
        quantity before the 180th day after the date of such 
        importation. This clause shall apply to appraisement of 
        merchandise only if the importer so elects and notifies 
        the customs officer concerned of that election within 
        such time as shall be prescribed by the Secretary.
    (B) For purposes of subparagraph (A), the unit price at 
which merchandise is sold in the greatest aggregate quantity is 
the unit price at which such merchandise is sold to unrelated 
persons, at the first commercial level after importation (in 
cases to which subparagraph (A) (i) or (ii) applies) or after 
further processing (in cases to which subparagraph (A)(iii) 
applies) at which such sales take place, in a total volume that 
is (i) greater than the total volume sold at any other unit 
price, and (ii) sufficient to establish the unit price.
    (3)(A) The price determined under paragraph (2) shall be 
reduced by an amount equal to--
          (i) any commission usually paid or agreed to be paid, 
        or the addition usually made for profit and general 
        expenses, in connection with sales in the United States 
        of imported merchandise that is of the same class or 
        kind, regardless of the country of exportation, as the 
        merchandise concerned;
          (ii) the actual costs and associated costs of 
        transportation and insurance incurred with respect to 
        international shipments of the merchandise concerned 
        from the country of exportation to the United States;
          (iii) the usual costs and associated costs of 
        transportation and insurance incurred with respect to 
        shipments of such merchandise from the place of 
        importation to the place of delivery in the United 
        States, if such costs are not included as a general 
        expense under clause (i);
          (iv) the customs duties and other Federal taxes 
        currently payable on the merchandise concerned by 
        reason of its importation, and any Federal excise tax 
        on, or measured by the value of, such merchandise for 
        which vendors in the United States are ordinarily 
        liable; and
          (v) (but only in the case of a price determined under 
        paragraph (2)(A)(iii)) the value added by the 
        processing of the merchandise after importation to the 
        extent that the value is based on sufficient 
        information relating to cost of such processing.
    (B) For purposes of applying paragraph (A)--
          (i) the deduction made for profits and general 
        expenses shall be based upon the importer's profits and 
        general expenses, unless such profits and general 
        expenses are inconsistent with those reflected in sales 
        in the United States of imported merchandise of the 
        same class or kind, in which case the deduction shall 
        be based on the usual profit and general expenses 
        reflected in such sales, as determined from sufficient 
        information; and
          (ii) any State or local tax imposed on the importer 
        with respect to the sale of imported merchandise shall 
        be treated as a general expense.
    (C) The price determined under paragraph (2) shall be 
increased (but only to the extent that such costs are not 
otherwise included) by an amount equal to the packing costs 
incurred by the importer or the buyer, as the case may be, with 
respect to the merchandise concerned.
    (D) For purposes of determining the deductive value of 
imported merchandise, and sale to a person who supplies any 
assist for use in connection with the production or sale for 
export of the merchandise concerned shall be disregarded.
    (e) Computed Value.--(1) The computed value of imported 
merchandise is the sum of--
          (A) the cost of the value of the materials and the 
        fabrication and other processing of any kind employed 
        in the production of the imported merchandise;
          (B) an amount for profit and general expenses equal 
        to that usually reflected in sales of merchandise of 
        the same class or kind as the imported merchandise that 
        are made by the producers in the country of exportation 
        for export to the United States;
          (C) any assist, if its value is not included under 
        subparagraph (A) or (B); and
          (D) the packing costs.
    (2) For purposes of paragraph (1)--
          (A) the cost or value of materials under paragraph 
        (1)(A) shall not include the amount of any internal tax 
        imposed by the country of exportation that is directly 
        applicable to the materials or their disposition if the 
        tax is remitted or refunded upon the exportation of the 
        merchandise in the production of which the materials 
        were used; and
          (B) the amount for profit and general expenses under 
        paragraph (1)(B) shall be based upon the producer's 
        profits and expenses, unless the producer's profits and 
        expenses are inconsistent with those usually reflected 
        in sales of merchandise of the same class or kind as 
        the imported merchandise that are made by producers in 
        the country of exportation for export to the United 
        States, in which case the amount under paragraph (1)(B) 
        shall be based on the usual profit and general expenses 
        of such producers in such sales, as determined from 
        sufficient information.
    (f) Value if Other Values Cannot Be Determined or Used.--
(1) If the value of imported merchandise cannot be determined, 
or otherwise used for purposes of this Act, under subsections 
(b) through (e), the merchandise shall be appraised for the 
purposes of this Act on the basis of a value that is derived 
from the methods set forth in such subsection, with such 
methods being reasonably adjusted to the extent necessary to 
arrive at a value.
    (2) Imported merchandise may not be appraised, for the 
purposes of this Act, on the basis of--
          (A) the selling price in the United States of 
        merchandise produced in the United States;
          (B) a system that provides for the appraisement of 
        imported merchandise at the higher of two alternative 
        values;
          (C) the price of the merchandise in the domestic 
        market of the country of exportation;
          (D) a cost of production, other than a value 
        determined under subsection (e) for merchandise being 
        appraised;
          (E) the price of the merchandise for export to a 
        country other than the United States;
          (F) minimum values for appraisement; or
          (G) arbitrary or fictitious values.
This paragraph shall not apply with respect to the 
ascertainment, determination, or estimation of foreign market 
value or United States price under title VII.
    (g) Special Rules.--(1) For purposes of this section, the 
persons specified in any of the following subparagraphs shall 
be treated as persons who are related:
          (A) Members of the same family, including brothers, 
        and sisters (whether by whole or half blood), spouse, 
        ancestors, and lineal descendants.
          (B) Any officer or director of an organization and 
        such organization.
          (C) An officer or director of an organization and an 
        officer or director of another organization, if each 
        such individual is also an officer or director in the 
        other organization.
          (D) Partners.
          (E) Employer and employee.
          (F) Any person directly or indirectly owning, 
        controlling, or holding with power to vote, 5 percent 
        or more of the outstanding voting stock or shares of 
        any organization and such organization.
          (G) Two or more persons directly or indirectly 
        controlling, controlled by, or under common control 
        with, any person.
    (2) For purposes of this section, merchandise (including, 
but not limited to, identical merchandise and similar 
merchandise) shall be treated as being of the same class or 
kind as other merchandise if it is within a group or range of 
merchandise produced by a particular industry or industry 
sector.
    (3) For purposes of this section, information that is 
submitted by an importer, buyer, or producer in regard to the 
appraisement of merchandise may not be rejected by the customs 
officer concerned on the basis of the accounting method by 
which that information was prepared, if the preparation was in 
accordance with generally accepted accounting principles. The 
term ``generally accepted accounting principles'' refers to any 
generally recognized consensus or substantial authoritative 
support regarding--
          (A) which economic resources and obligations should 
        be recorded as assets and liabilities;
          (B) which changes in assets and liabilities should be 
        recorded;
          (C) how the assets and liabilities and changes in 
        them should be measured;
          (D) what information should be disclosed and how it 
        should be disclosed; and
          (E) which financial statements should be prepared.
The applicability of a particular set of generally accepted 
accounting principles will depend upon the basis on which the 
value of the merchandise is sought to be established.
    (h) Definitions.--As used in this section--
          (1)(A) The term ``assist'' means any of the following 
        if supplied directly or indirectly, and free of charge 
        or at reduced cost, by the buyer of imported 
        merchandise for use in connection with the production 
        or the sale for export to the United States of the 
        merchandise:
                  (i) Materials, components, parts, and similar 
                items incorporated in the imported merchandise.
                  (ii) Tools, dies, molds, and similar items 
                used in the production of the imported 
                merchandise.
                  (iii) Merchandise consumed in the production 
                of the imported merchandise.
                  (iv) Engineering, development, artwork, 
                design work, and plans and sketches that are 
                undertaken elsewhere than in the United States 
                and are necessary for the production of the 
                imported merchandise.
          (B) No service or work to which subparagraph (A)(iv) 
        applies shall be treated as an assist for purposes of 
        this section if such service or work--
                  (i) is performed by an individual who is 
                domiciled within the United States;
                  (ii) is performed by that individual while he 
                is acting as an employee or agent of the buyer 
                of the imported merchandise; and
                  (iii) is incidental to other engineering, 
                development, artwork, design work, or plans or 
                sketches that are undertaken within the United 
                States.
          (C) For purposes of this section, the following apply 
        in determining the value of assists described in 
        subparagraph (A)(iv):
                  (i) The value of an assist that is available 
                in the public domain is the cost of obtaining 
                copies of the assist.
                  (ii) If the production of an assist occurred 
                in the United States and one or more foreign 
                countries, the value of the assist is the value 
                thereof that is added outside the United 
                States.
          (2) The term ``identical merchandise'' means--
                  (A) merchandise that is identical in all 
                respects to, and was produced in the same 
                country and by the same person as, the 
                merchandise being appraised; or
                  (B) if merchandise meeting the requirement 
                under subparagraph (A) cannot be found (or for 
                purposes of applying subsection (b)(2)(B)(i), 
                regardless of whether merchandise meeting such 
                requirements can be found), merchandise that is 
                identical in all repects to, and was produced 
                in the same country as, but not produced by the 
                same person as, the merchandise being 
                appraised.
        Such term does not include merchandise that 
        incorporates or reflects any engineering, development, 
        artwork, design work, or plan or sketch that--
                  (I) was supplied free or at reduced cost by 
                the buyer of the merchandise for use in 
                connection with the production or the sale for 
                export to the United States of the merchandise; 
                and
                  (II) is not an assist because undertaken 
                within the United States.
          (3) The term ``packing costs'' means the cost of all 
        containers and coverings of whatever nature and of 
        packing, whether for labor or materials, used in 
        placing merchandise in condition, packed ready for 
        shipment to the United States.
          (4) The term ``similar merchandise'' means--
                  (A) merchandise that--
                          (i) was produced in the same country 
                        and by the same person as the 
                        merchandise being appraised,
                          (ii) is like the merchandise being 
                        appraised in characteristics and 
                        component material, and
                          (iii) is commercially interchangeable 
                        with the merchandise being appraised; 
                        or
                  (B) if merchandise meeting the requirements 
                under subparagraph (A) cannot be found (or for 
                purposes of applying subsection (b)(2)(B)(i), 
                regardless of whether merchandise meeting such 
                requirements can be found), merchandise that--
                          (i) was produced in the same country 
                        as, but not produced by the same person 
                        as, the merchandise being appraised, 
                        and
                          (ii) meets the requirements set forth 
                        in subparagraph (A) (ii) and (iii).
        Such term does not include merchandise that 
        incorporates or reflects any engineering, development, 
        artwork, design work, or plan or sketch that--
                  (I) was supplied free or at reduced cost by 
                the buyer of the merchandise for use in 
                connection with the production or the sale for 
                export to the United States of the merchandise; 
                and
                  (II) is not an assist because undertaken 
                within the United States.
          (5) The term ``sufficient information'', when 
        required under this section for determining--
                  (A) any amount--
                          (i) added under subsection (b)(1) to 
                        the price actually paid or payable,
                          (ii) deducted under subsection (d)(3) 
                        as profit or general expense or value 
                        from further processing, or
                          (iii) added under subsection (e)(2) 
                        as profit or general expense;
                  (B) and difference taken into account for 
                purposes of subsection (b)(2)(C); or
                  (C) any adjustment made under subsection 
                (c)(2);
        means information that establishes the accuracy of such 
        amount, difference, or adjustment.

                          H. CUSTOMS USER FEES


Section 13031 of the Consolidated Budget Reconciliation Act of 1985, as 
                                amended


 [19 U.S.C. 58c; P.L. 99-272, as amended by P.L. 99-509, P.L. 99-514, 
 P.L. 100-203, P.L. 100-418, P.L. 100-449, P.L. 100-647, P.L. 101-207, 
 P.L. 101-382, P.L. 101-508, P.L. 103-66, P.L. 103-182, P.L. 103-465, 
                P.L. 104-295, P.L. 106-36, P.L. 106-476]

SEC. 13031. FEES FOR CERTAIN CUSTOMS SERVICES.

    (a) Schedule of Fees.--In addition to any other fee 
authorized by law, the Secretary of the Treasury shall charge 
and collect the following fees for the provision of customs 
services in connection with the following:
          (1) For the arrival of a commercial vessel of 100 net 
        tons or more, $397.
          (2) For the arrival of a commercial truck, $5.
          (3) For the arrival of each railroad car carrying 
        passengers or commercial freight, $7.50.
          (4) For all arrivals made during a calendar year by a 
        private vessel or private aircraft, $25.
          (5)(A) Subject to subparagraph (B), for the arrival 
        of each passenger aboard a commercial vessel or 
        commercial aircraft from a place outside the United 
        States (other than a place referred to in subsection 
        (b)(1)(A)(i) of this section), $5.
          (B)For the arrival of each passenger aboard a 
        commercial vessel from a place referred to in 
        subsection (b)(1)(A)(i) of this section, $1.75.
          (6) For each item of dutiable mail for which a 
        document is prepared by a customs officer, $5.
          (7) For each customs broker permit held by an 
        individual, partnership, association, or corporate 
        customs broker, $125 per year.
          (8) For the arrival of a barge or other bulk carrier 
        from Canada or Mexico, $100.
          (9)(A) For the processing of merchandise that is 
        formally entered or released during any fiscal year, a 
        fee in an amount equal to 0.21 percent ad valorem, 
        unless adjusted under subparagraph (B).
          (B)(i) The Secretary of the Treasury may adjust the 
        ad valorem rate specified in subparagraph (A) to an ad 
        valorem rate (but not to a rate of more than 0.21 
        percent nor less than 0.15 percent) and the amounts 
        specified in subsection (b)(8)(A)(i) (but not to more 
        than $485 nor less than $21) to rates and amounts which 
        would, if charged, offset the salaries and expenses 
        that will likely be incurred by the Customs Service in 
        the processing of such entries and releases during the 
        fiscal year in which such costs are incurred.
          (ii) In determining the amount of any adjustment 
        under clause (i), the Secretary of the Treasury shall 
        take into account whether there is a surplus or deficit 
        in the fund established under subsection (f) with 
        respect to the provision of customs services for the 
        processing of formal entries and releases of 
        merchandise.
          (iii) An adjustment may not be made under clause (i) 
        with respect to the fee charged during any fiscal year 
        unless the Secretary of the Treasury--
                  (I) not later than 45 days after the date of 
                the enactment of the Act providing full-year 
                appropriations for the Customs Service for that 
                fiscal year, publishes in the Federal Register 
                a notice of intent to adjust the fee under this 
                paragraph and the amount of such adjustment;
                  (II) provides a period of not less than 30 
                days following publication of the notice 
                described in subclause (I) for public comment 
                and consultation with the Committee on Finance 
                of the Senate and the Committee on Ways and 
                Means of the House of Representatives regarding 
                the proposed adjustment and the methodology 
                used to determine such adjustment;
                  (III) upon the expiration of the period 
                provided under subclause (II), notifies such 
                committees in writing regarding the final 
                determination to adjust the fee, the amount of 
                such adjustment, and the methodology used to 
                determine such adjustment; and
                  (IV) upon the expiration of the 15-day period 
                following the written notification described in 
                subclause (III), submits for publication in the 
                Federal Register notice of the final 
                determination regarding the adjustment of the 
                fee.
          (iv) The 15-day period referred to in clause 
        (iii)(IV) shall be computed by excluding--
                  (I) the days on which either House is not in 
                session because of an adjournment of more than 
                3 days to a day certain or an adjournment of 
                the Congress sine die; and
                  (II) any Saturday and Sunday, not excluded 
                under subclause (I), when either House is not 
                in session.
          (v) An adjustment made under this subparagraph shall 
        become effective with respect to formal entries and 
        releases made on or after the 15th calendar day after 
        the date of publication of the notice described in 
        clause (iii)(IV) and shall remain in effect until 
        adjusted under this subparagraph.
          (C) If for any fiscal year, the Secretary of the 
        Treasury determines not to make an adjustment under 
        subparagraph (B), the Secretary shall, within the time 
        prescribed under subparagraph (B)(iii)(I), submit a 
        written report to the Committee on Finance of the 
        Senate and the Committee on Ways and Means of the House 
        of Representatives detailing the reasons for 
        maintaining the current fee and the methodology used 
        for computing such fee.
          (D) Any fee charged under this paragraph, whether or 
        not adjusted under subparagraph (B), is subject to the 
        limitations in subsection (b)(8)(A).
          (10) For the processing of merchandise that is 
        informally entered or released, other than at--
                  (A) a centralized hub facility,
                  (B) an express consignment carrier facility, 
                or
                  (C) a small airport or other facility to 
                which section 236 of the Trade and Tariff Act 
                of 1984 applies, if more than 25,000 informal 
                entries were cleared through such airport or 
                facility during the fiscal year preceding such 
                entry or release,
        a fee of--
                  (i) $2 if the entry or release is automated 
                and not prepared by customs personnel;
                  (ii) $6 if the entry or release is manual and 
                not prepared by customs personnel; or
                  (iii) $9 if the entry or release, whether 
                automated or manual, is prepared by customs 
                personnel.
        For provisions relating to the informal entry or 
        release of merchandise at facilities referred to in 
        subparagraphs (A), (B), and (C), see subsection (b)(9).
    (b) Limitations on Fees.--(1)(A) Except as provided in 
subsection (a)(5)(B) of this section, no fee may be charged 
under subsection (a) of this section for customs services 
provided in connection with--
          (i) the arrival of any passenger whose journey--
                  (I) originated in--
                          (aa) Canada,
                          (bb) Mexico,
                          (cc) a territory or possession of the 
                        United States, or
                          (dd) any adjacent island (within the 
                        meaning of section 101(b)(5) of the 
                        Immigration and Nationality Act (8 
                        U.S.C. 1101(b)(5))), or
                  (II) originated in the United States and was 
                limited to--
                          (aa) Canada,
                          (bb) Mexico,
                          (cc) territories and possessions of 
                        the United States, and
                          (dd) such adjacent islands;
          (ii) the arrival of any railroad car the journey of 
        which originates and terminates in the same country, 
        but only if no passengers board or disembark from the 
        train and no cargo is loaded or unloaded from such car 
        while the car is within any country other than the 
        country in which such car originates and terminates;
          (iii) the arrival of a ferry, except for a ferry 
        whose operations begin on or after August 1, 1999, and 
        that operates south of 27 degrees latitude and east of 
        89 degrees longitude; or
          (iv) the arrival of any passenger on board a 
        commercial vessel traveling only between ports which 
        are within the customs territory of the United States.
    (B) The exemption provided for in subparagraph (A) shall 
not apply in the case of the arrival of any passenger on board 
a commercial vessel whose journey originates and terminates at 
the same place in the United States if there are no intervening 
stops.
    (C) The exemption provided for in subparagraph (A)(i) shall 
not apply to fiscal years 1994, 1995, 1996, and 1997.
    (2) No fee may be charged under subsection (a)(2) for the 
arrival of a commercial truck during any calendar year after a 
total of $100 in fees has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such commercial truck during such calendar year.
    (3) No fee may be charged under subsection (a)(3) for the 
arrival of a railroad car whether passenger or freight during 
any calendar year after a total of $100 in fees has been paid 
to the Secretary of the Treasury for the provision of customs 
services for all arrivals of such passenger or freight rail car 
during such calendar year.
    (4)(A) No fee may be charged under subsection (a)(5) with 
respect to the arrival of any passenger--
          (i) who is in transit to a destination outside the 
        customs territory of the United States, and
          (ii) for whom customs inspectional services are not 
        provided.
    (B) In the case of a commercial vessel making a single 
voyage involving 2 or more United States ports with respect to 
which the passengers would otherwise by charged a fee pursuant 
to subsection (a)(5), such fee shall be charged only 1 time for 
each passenger.
    (5) No fee may be charged under subsection (a)(1) for the 
arrival of--
          (A) a vessel during a calendar year after a total of 
        $5,955 in fees charged under paragraph (1) or (8) of 
        subsection (a) has been paid to the Secretary of the 
        Treasury for the provision of customs services for all 
        arrivals of such vessel during such calendar year,
          (B) any vessel which, at the time of the arrival, is 
        being used solely as a tugboat, or
          (C) any barge or other bulk carrier from Canada or 
        Mexico.
    (6) No fee may be charged under section (a)(8) for the 
arrival of a barge or other bulk carrier during a calendar year 
after a total of $1,500 in fees charged under paragraph (1) or 
(8) of subsection (a) has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such barge or other bulk carrier during such calendar year.
    (7) No fee may be charged under paragraphs (2), (3), or (4) 
of subsection (a) for the arrival of any--
          (A) commercial truck,
          (B) railroad car, or
          (C) private vessel,
that is being transported, at the time of the arrival, by any 
vessel that is not a ferry.
    (8)(A)(i) Subject to clause (ii), the fee charged under 
subsection (a)(9) for the formal entry or release of 
merchandise may not exceed $485 or be less than $25, unless 
adjusted pursuant to subsection (a)(9)(B).
    (ii) A surcharge of $3 shall be added to the fee determined 
after application of clause (i) for any manual entry or release 
of merchandise.
    (B) No fee may be charged under subsection (a)(9) or (10) 
for the processing of any article that is--
          (i) provided for under any item in chapter 98 of the 
        Harmonized Tariff Schedule of the United States, except 
        subheading 9802.00.60 or 9802.00.80,
          (ii) a product of an insular possession of the United 
        States, or
          (iii) a product of any country listed in subdivision 
        (c)(ii)(B) or (c)(v) of general note 3 to such 
        Schedule.
    (C) For purposes of applying subsection (a)(9) or (10)--
          (i) expenses incurred by the Secretary of the 
        Treasury in the processing of merchandise do not 
        include costs incurred in--
                  (I) air passenger processing,
                  (II) export control, or
                  (III) international affairs, and
          (ii) any reference to a manual formal or informal 
        entry or release includes any entry or release filed by 
        a broker or importer that requires the inputting of 
        cargo selectivity data into the Automated Commercial 
        System by customs personnel, except when--
                  (I) the broker or importer is certified as an 
                ABI cargo release filer under the Automated 
                Commercial System at any port within the United 
                States, or
                  (II) the entry or release is filed at ports 
                prior to the full implementation of the cargo 
                selectivity data system by the Customs Service 
                at such ports.
    (D) The fee charged under subsection (a)(9) or (10) with 
respect to the processing of merchandise shall--
          (i) be paid by the importer of record of the 
        merchandise;
          (ii) except as otherwise provided in this paragraph, 
        be based on the value of the merchandise as determined 
        under section 402 of the Tariff Act of 1930;
          (iii) in the case of merchandise classified under 
        subheading 9802.00.60 of the Harmonized Tariff Schedule 
        of the United States, be applied to the value of the 
        foreign repairs or alterations to the merchandise;
          (iv) in the case of merchandise classified under 
        heading 9802.00.80 of such Schedule, be applied to the 
        full value of the merchandise, less the cost or value 
        of the component United States products;
          (v) in the case of agricultural products of the 
        United States that are processed and packed in a 
        foreign trade zone, be applied only to the value of 
        material used to make the container for such 
        merchandise, if such merchandise is subject to entry 
        and the container is of a kind normally used for 
        packing such merchandise; and
          (vi) in the case of merchandise entered from a 
        foreign trade zone (other than merchandise to which 
        clause (v) applies), be applied only to the value of 
        the privileged or nonprivileged foreign status 
        merchandise under section 3 of the Act of June 18, 1934 
        (commonly known as the Foreign Trade Zones Act, 19 
        U.S.C. 81c).
With respect to merchandise that is classified under subheading 
9802.00.60 or heading 9802.00.80 of such Schedule and is duty-
free, the Secretary may collect the fee charged on the 
processing of the merchandise under subsection (a)(9) or (10) 
on the basis of aggregate data derived from financial and 
manufacturing reports used by the importer in the normal course 
of business, rather than on the basis of entry-by-entry 
accounting.
    (E) For purposes of subsection (a)(9) and (10), merchandise 
is entered or released, as the case may be, if the merchandise 
is--
          (i) permitted or released under section 448(b) of the 
        Tariff Act of 1930,
          (ii) entered or released from customs custody under 
        section 484(a)(1)(A) of the Tariff Act of 1930, or
          (iii) withdrawn from warehouse for consumption.
    (9)(A) With respect to the processing of merchandise that 
is informally entered or released at a centralized hub 
facility, an express consignment carrier facility, or a small 
airport or other facility, the following reimbursements and 
payments are required:
          (i) In the case of a small airport or other 
        facility--
                  (I) the reimbursement which such facility is 
                required to make during the fiscal year under 
                section 9701 of title 31, United States Code or 
                section 236 of the Trade and Tariff Act of 
                1984; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement under subclause (I).
          (ii) In the case of an express consignment carrier 
        facility or centralized hub facilty--
                  (I) an amount, for which the Customs Service 
                shall be reimbursed under section 524 of the 
                Tariff Act of 1930, equal to the cost of the 
                services provided by the Customs Service for 
                the facility during the fiscal year; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement made under subclause (I).
    (B) For purposes of this paragraph:
          (i) The terms ``centralized hub facility'' and 
        ``express consignment carrier facility'' have the 
        respective meanings that are applied to such terms in 
        part 128 of chapter I of title 19, Code of Federal 
        Regulations. Nothing in this paragraph shall be 
        construed as prohibiting the Secretary of the Treasury 
        from processing merchandise that is informally entered 
        or released at any centralized hub facility or express 
        consignment carrier facility during the normal 
        operating hours of the Customs Service, subject to 
        reimbursement and payment under subparagraph (A).
          (ii) The term ``small airport or other facility'' 
        means any airport or facility to which section 236 of 
        the Trade and Tariff Act of 1984 applies, if more than 
        25,000 informal entries were cleared through such 
        airport or facility during the preceding fiscal year.
    (10)(A) The fee charged under subsection (a)(9) or (10) 
with respect to goods of Canadian origin (as determined under 
section 202 of the United States-Canada Free-Trade Agreement 
Implementation Act of 1988) when the United States-Canada Free-
Trade Agreement is in force shall be in accordance with article 
403 of that Agreement.
    (B) For goods qualifying under the rules of origin set out 
in section 202 of the North American Free Trade Agreement 
Implementation Act, the fee under subsection (a)(9) or (10)--
          (i) may not be charged with respect to goods that 
        qualify to be marked as goods of Canada pursuant to 
        Annex 311 of the North American Free Trade Agreement, 
        for such time as Canada is a NAFTA country, as defined 
        in section 2(4) of such Implementation Act; and
          (ii) may not be increased after December 31, 1993, 
        and may not be charged after June 29, 1999, with 
        respect to goods that qualify to be marked as goods of 
        Mexico pursuant to such Annex 311, for such time as 
        Mexico is a NAFTA country. Any service for which an 
        exemption from such fee is provided by reason of this 
        paragraph may not be funded with money contained in the 
        Customs User Fee Account.
    (11) No fee may be charged under subsection (a)(9) or (10) 
with respect to products of Israel if an exemption with respect 
to the fee is implemented under section 112 of the Customs and 
Trade Act of 1990.
    (c) Definitions.--For purposes of this section--
          (1) The term ``ferry'' means any vessel which is 
        being used--
                  (A) to provide transportation only between 
                places that are no more than 300 miles apart, 
                and
                  (B) to transport only--
                          (i) passengers, or
                          (ii) vehicles, or railroad cars, 
                        which are being used, or have been 
                        used, in transporting passengers or 
                        goods.
          (2) The term ``arrival'' means arrival at a port of 
        entry in the customs territory of the United States.
          (3) The term ``customs territory of the United 
        States'' has the meaning given to such term by general 
        note 2 of the Harmonized Tariff Schedule of the United 
        States.
          (4) The term ``customs broker permit'' means a permit 
        issued under section 641(c) of the Tariff Act of 1930 
        (19 U.S.C. 1641(c)).
          (5) The term ``barge or other bulk carrier'' means 
        any vessel which--
                  (A) is not self-propelled, or
                  (B) transports fungible goods that are not 
                packaged in any form.
    (d) Collection.--(1) Each person that issues a document or 
ticket to an individual for transportation by a commercial 
vessel or commercial aircraft into the customs territory of the 
United States shall--
          (A) collect from that individual the fee charged 
        under subsection (a)(5) at the time the document or 
        ticket is issued; and
          (B) separately identify on that document or ticket 
        the fee charged under subsection (a)(5) as a Federal 
        inspection fee.
    (2) If--
          (A) a document or ticket for transportation of a 
        passenger into the customs territory of the United 
        States is issued in a foreign country; and
          (B) the fee charged under subsection (a)(5) is not 
        collected at the time such document or ticket is 
        issued;
the person providing transportation to such passenger shall 
collect such fee at the time such passenger departs from the 
customs territory of the United States and shall provide such 
passenger a receipt for the payment of such fee.
    (3) The person who collects fees under paragraph (1) or (2) 
shall remit those fees to the Secretary of the Treasury at any 
time before the date that is 31 days after the close of the 
calendar quarter in which the fees are collected.
    (4)(A) Notice of the date on which payment of the fee 
imposed by subsection (a)(7) is due shall be published by the 
Secretary of the Treasury in the Federal Register by no later 
than the date that is 60 days before such due date.
    (B) A customs broker permit may be revoked or suspended for 
nonpayment of the fee imposed by subsection (a)(7) only if 
notice of the date on which payment of such fee is due was 
published in the Federal Register at least 60 days before such 
due date.
    (C) The customs broker's license issued under section 
641(b) of the Tariff Act of 1930 (19 U.S.C. 1641(b)) may not be 
revoked or suspended merely by reason of nonpayment of the fee 
imposed under subsection (a)(7).
    (e)(1) Notwithstanding section 451 of the Tariff Act of 
1930 (19 U.S.C. 1451) or any other provision of law (other than 
paragraph (2)), the customs services required to be provided to 
passengers upon arrival in the United States shall be 
adequately provided in connection with scheduled airline 
flights at customs serviced airports when needed and at no cost 
(other than the fees imposed under subsection (a)) to airlines 
and airline passengers.
    (2)(A) This subsection shall not apply with respect to any 
airport, seaport, or other facility to which section 236(c) of 
the Trade and Tariff Act of 1984 (19 U.S.C. 58b(c)) applies.
    (B) Subparagraph (C) of paragraph (6) shall not apply with 
respect to any foreign trade zone or subzone that is located 
at, or in the vicinity of, an airport, seaport, or other 
facility to which section 236 of the Trade and Tariff Act of 
1984 applies.
    (3) Notwithstanding section 451 of the Tariff Act of 1930 
(19 U.S.C. 1451) or any provision of law--
          (A) the customs services required to be provided to 
        passengers upon arrival in the United States shall be 
        adequately provided in connection with scheduled 
        airline flights when needed at places located outside 
        the customs territory of the United States at which a 
        customs officer is stationed for the purpose of 
        providing such customs services, and
          (B) other than the fees imposed under subsection (a), 
        the airlines and airline passengers shall not be 
        required to reimburse the Secretary of the Treasury for 
        the costs of providing overtime customs inspectional 
        services at such places.
    (4) Notwithstanding any other provision of law, all customs 
services (including, but not limited to, normal and overtime 
clearance and preclearance services) shall be adequately 
provided, when requested, for--
          (A) the clearance of any commercial vessel, vehicle, 
        or aircraft or its passengers, crew, stores, material, 
        or cargo arriving, departing, or transiting the United 
        States;
          (B) the preclearance at any customs facility outside 
        the United States of any commercial vessel, vehicle or 
        aircraft or its passengers, crew, stores, material, or 
        cargo; and
          (C) the inspection or release of commercial cargo or 
        other commercial shipments being entered into, or 
        withdrawn from, the customs territory of the United 
        States.
    (5) For purposes of this subsection, customs services shall 
be treated as being ``adequately provided'' if such of those 
services that are necessary to meet the needs of parties 
subject to customs inspection are provided in a timely manner 
taking into account factors such as--
          (A) the unavoidability of weather, mechanical, and 
        other delays;
          (B) the necessity for prompt and efficient passenger 
        and baggage clearance;
          (C) the perishability of cargo;
          (D) the desirability or unavoidability of late night 
        and early morning arrivals from various time zones;
          (E) the availability (in accordance with regulations 
        prescribed under subsection (g)(2)) of customs 
        personnel and resources; and
          (F) the need for specific enforcement checks.
    (6) Notwithstanding any other provision of law except 
paragraph (2), during any period when fees are authorized under 
subsection (a), no charges, other than such fees, may be 
collected--
          (A) for any--
                  (i) cargo inspection, clearance, or other 
                customs activity, expense, or service performed 
                (regardless whether performed outside of normal 
                business hours on an overtime basis), or
                  (ii) customs personnel provided, in 
                connection with the arrival or departure of any 
                commercial vessel, vehicle, or aircraft, or its 
                passengers, crew, stores, material, or cargo, 
                in the United States;
          (B) for any preclearance or other customs activity, 
        expense, or service performed, and any customs 
        personnel provided, outside the United States in 
        connection with the departure of any commercial vessel, 
        vehicle, or aircraft, or its passengers, crew, stores, 
        material, or cargo, for the United States; or
          (C) in connection with--
                  (i) the activation or operation (including 
                Customs Service supervision) of any foreign 
                trade zone or subzone established under the Act 
                of June 18, 1934 (commonly known as the Foreign 
                Trade Zones Act, 19 U.S.C. 81a et seq.), or
                  (ii) the designation or operation (including 
                Customs Service supervision) of any bonded 
                warehouse under section 555 of the Tariff Act 
                of 1930 (19 U.S.C. 1555).
    (f) Disposition of Fees.--(1) There is established in the 
general fund of the Treasury a separate account which shall be 
known as the ``Customs User Fee Account''. Notwithstanding 
section 524 of the Tariff Act of 1930 (19 U.S.C. 1524), there 
shall be deposited as offsetting receipts into the Customs User 
Fee Account all fees collected under subsection (a) except--
          (A) the portion of such fees that is required under 
        paragraph (3) for the direct reimbursement of 
        appropriations, and
          (B) the portion of such fees that is determined by 
        the Secretary to be excess fees under paragraph (5).
    (2) Except as otherwise provided in this subsection, all 
funds in the Customs User Fee Account shall be available, to 
the extent provided for appropriations Acts, to pay the costs 
(other than costs for which direct reimbursement under 
paragraph (3) is required) incurred by the United States 
Customs Service in conducting commercial operations, including, 
but not limited to, all costs associated with commercial 
passenger, vessel, vehicle, aircraft, and cargo processing. So 
long as there is a surplus of funds in the Customs User Fee 
Account, the Secretary of the Treasury may not reduce personnel 
staffing levels for providing commercial clearance and 
preclearance services.
    (3)(A) The Secretary of the Treasury, in accordance with 
section 524 of the Tariff Act of 1930 and subject to 
subparagraph (B), shall directly reimburse, from the fees 
collected under subsection (a) (other than the fees under 
subsection (a)(9) and (10) and the excess fees determined by 
the Secretary under paragraph (5)), each appropriation for the 
amount paid out of that appropriation for the costs incurred by 
the Secretary--
          (i) in--
                  (I) paying overtime compensation under 
                section 5(a) of the Act of February 13, 1911,
                  (II) paying premium pay under section 5(b) of 
                the Act of February 13, 1911, but the amount 
                for which reimbursement may be made under this 
                subclause may not, for any fiscal year, exceed 
                the difference between the total cost of all 
                the premium pay for such year calculated under 
                section 5(b) and the cost of the night and 
                holiday premium pay that the Customs Service 
                would have incurred for the same inspectional 
                work on the day before the effective date of 
                section 13813 of the Omnibus Budget 
                Reconciliation Act of 1993,
                  (III) paying agency contributions to the 
                Civil Service Retirement and Disability Fund to 
                match deductions from the overtime compensation 
                paid under subclause (I),
                  (IV) providing all preclearance services for 
                which the recipients of such services are not 
                required to reimburse the Secretary of the 
                Treasury, and
                  (V) paying foreign language proficiency 
                awards under section 13812(b) of the Omnibus 
                Budget Reconciliation Act of 1993,
          (ii) to the extent funds remain available after 
        making reimbursements under clause (i), in providing 
        salaries for full-time and part-time inspectional 
        personnel and equipment that enhance customs services 
        for those persons or entities that are required to pay 
        fees under paragraphs (1) through (8) of subsection (a) 
        (distributed on a basis proportionate to the fees 
        collected under paragraphs (1) through (8) of 
        subsection(a)), and
          (iii) to the extent funds remain available after 
        making reimbursements under clause (ii), in providing 
        salaries for up to 50 full-time equivalent inspectional 
        positions to provide preclearance services.
The transfer of funds required under subparagraph (C)(iii) has 
priority over reimbursements under this subparagraph to carry 
out subclauses (II), (III), (IV), and (V) of clause (i). Funds 
described in clause (ii) shall only be available to reimburse 
costs in excess of the highest amount appropriated for such 
costs during the period beginning with fiscal year 1990 and 
ending with the current fiscal year.
    (B) Reimbursement of appropriations under this paragraph--
          (i) shall be subject to apportionment or similar 
        administrative practices;
          (ii) shall be made at least quarterly; and
          (iii) to the extent necessary, may be made on the 
        basis of estimates made by the Secretary of the 
        Treasury and adjustments shall be made in subsequent 
        reimbursements to the extent that the estimates were in 
        excess of, or less than, the amounts required to be 
        reimbursed.
    (C)(i) For fiscal year 1991 and subsequent fiscal years, 
the amount required to reimburse costs described in 
subparagraph (A)(i) shall be projected from actual 
requirements, and only the excess of collections over such 
projected costs for such fiscal year shall be used as provided 
in subparagraph (A)(ii).
    (ii) The excess of collections over inspectional overtime 
and preclearance costs (under subparagraph (A)(i)) reimbursed 
for fiscal years 1989 and 1990 shall be available in fiscal 
year 1991 and subsequent fiscal years for the purposes 
described in subparagraph (A)(ii), except that $30,000,000 of 
such excess shall remain without fiscal year limitation in a 
contingency fund and, in any fiscal year in which receipts are 
insufficient to cover the costs described in subparagraph (A) 
(i) and (ii), shall be used for--
          (I) the costs of providing the services described in 
        subparagraph (A)(i), and
          (II) after the costs described in subclause (I) are 
        paid, the costs of providing the personnel and 
        equipment described in subparagraph (A)(ii) at the 
        preceding fiscal year level.
    (iii) For each fiscal year, the Secretary of the Treasury 
shall calculate the difference between--
          (I) the estimated cost for overtime compensation that 
        would have been incurred during that fiscal year for 
        inspectional services if section 5 of the Act of 
        February 13, 1911 (19 U.S.C. 261 and 267), as in effect 
        before the enactment of section 13811 of the Omnibus 
        Budget Reconciliation Act of 1993, had governed such 
        costs, and
          (II) the actual cost for overtime compensation, 
        premium pay, and agency retirement contributions that 
        is incurred during that fiscal year in regard to 
        inspectional services under section 5 of the Act of 
        February 13, 1911, as amended by section 13811 of the 
        Omnibus Budget Reconciliation Act of 1993, and under 
        section 8331(3) of title 5, United States Code, as 
        amended by section 13812(a)(1) of such Act of 1993, 
        plus the actual cost that is incurred during that 
        fiscal year for foreign language proficiency awards 
        under section 13812(b) of such Act of 1993,
and shall transfer from the Customs User Fee Account to the 
General Fund of the Treasury an amount equal to the difference 
calculated under this clause, or $18,000,000, whichever amount 
is less. Transfers shall be made under this clause at least 
quarterly and on the basis of estimates to the same extent as 
are reimbursements under subparagraph (B)(iii).
    (D) At the close of each fiscal year, the Secretary of the 
Treasury shall submit a report to the Committee on Finance of 
the Senate and the Committee on Ways and Means of the House of 
Representatives summarizing the expenditures, on a port-by-port 
basis, for which reimbursement has been provided under 
subparagraph (A)(ii).
    (4) At the close of fiscal year 1988 and each even-numbered 
fiscal year occurring thereafter, the Secretary of the Treasury 
shall submit a report to the Committee on Ways and Means of the 
House of Representatives and the Committee on Finance of the 
Senate regarding how the fees imposed under subsection (a) 
(other than the excess fees determined by the Secretary under 
paragraph (5)) should be adjusted in order that the balance of 
the Customs User Fee Account approximates a zero balance. 
Before making recommendations regarding any such adjustments, 
the Secretary of the Treasury shall provide adequate 
opportunity for public comment. The recommendations shall, as 
precisely as possible, propose fees which reflect the actual 
costs to the United States Government for the commercial 
services provided by the United States Customs Service.
    (5) At the close of each of fiscal years 1994, 1995, 1996, 
and 1997, the Secretary of the Treasury shall determine the 
amount of the fees collected under paragraph (5)(A) of 
subsection (a) for that fiscal year that exceeds the amount of 
such fees that would have been collected for such fiscal year 
if the fees that were in effect on the day before the effective 
date of this paragraph applied to such fiscal year. The amount 
of the excess fees determined under the preceding sentence 
shall be deposited in the Customs User Fee Account and shall be 
available for reimbursement of inspectional costs (including 
passenger processing costs) not otherwise reimbursed under this 
section, and shall be available only to the extent provided in 
appropriations Acts.
    (6) Of the amounts collected in fiscal year 1999 under 
paragraphs (9) and (10) of subsection (a), $50,000,000 shall be 
available to the Customs Service, subject to appropriations 
Acts, for automated commercial systems. Amounts made available 
under this paragraph shall remain available until expended.
    (g) Regulations and Enforcement.--(1) The Secretary of the 
Treasury may prescribe such rules and regulations as may be 
necessary to carry out the provisions of this section. 
Regulations issued by the Secretary of the Treasury under this 
subsection with respect to the collection of the fees charged 
under subsection (a)(5) and the remittance of such fees to the 
Treasury of the United States shall be consistent with the 
regulations issued by the Secretary of the Treasury for the 
collection and remittance of the taxes imposed by subchapter C 
of chapter 33 of the Internal Revenue Code of 1954, but only to 
the extent the regulations issued with respect to such taxes do 
not conflict with the provisions of this section.
    (2) Except to the extent otherwise provided in regulations, 
all administrative and enforcement provisions of customs laws 
and regulations, other than those laws and regulations relating 
to drawback, shall apply with respect to any fee prescribed 
under subsection (a) of this section, and with respect to 
persons liable therefor, as if such fee is a customs duty. For 
purposes of the preceding sentence, any penalty expressed in 
terms of a relationship to the amount of the duty shall be 
treated as not less than the amount which bears a similar 
relationship to the amount of the fee assessed. For purposes of 
determining the jurisdiction of any court of the United States 
or any agency of the United States, any fee prescribed under 
subsection (a) of this section shall be treated as if such fee 
is a customs duty.
    [(h) Conforming Amendments.]
    (i) Effect on Other Authority.--Except with respect to 
customs services for which fees are imposed under subsection 
(a), nothing in this section shall be construed as affecting 
the authority of the Secretary of the Treasury to charge fees 
under section 214(b) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 58a).
    (j) Effective Dates.--(1) Except as otherwise provided in 
this subsection, the provisions of this section, and the 
amendments and repeals made by this section shall apply with 
respect to customs services rendered after the date that is 90 
days after the date of enactment of this Act.
    (2) Fees may be charged under subsection (a)(5) only with 
respect to customs services rendered in regard to arriving 
passengers using transportation for which documents or tickets 
were issued after the date that is 90 days after such date of 
enactment.
    (3) Fees may not be charged under subsection (a) after 
September 30, 2003.
    (k) Advisory Committee.--The Commissioner of Customs shall 
establish an advisory committee whose membership shall consist 
of representatives from the airline, cruise ship, and other 
transportation industries who may be subject to fees under 
subsection (a). The advisory committee shall not be subject to 
termination under section 14 of the Federal Advisory Committee 
Act. The advisory committee shall meet on a periodic basis and 
shall advise the Commissioner on issues related to the 
performance of the inspectional services of the United States 
Customs Service. Such advice shall include, but not be limited 
to, such issues as the time periods during which such services 
should be performed, the proper number and deployment of 
inspection officers, the level of fees, and the appropriateness 
of any proposed fee. The Commissioner shall give consideration 
to the views of the advosory committee in the exercise of his 
or her duties.

Sections 111(f), 112, and 113 of the Customs and Trade Act of 1990, as 
                                amended


 [19 U.S.C. 58c note, 19 U.S.C. 2082; P.L. 101-382, as amended by P.L. 
                                101-508]

SEC. 111. CUSTOMS USER FEES.

           *       *       *       *       *       *       *


    (f) Aggregation of Merchandise Processing Fees.--
          (1) Notwithstanding any provision of section 13031 of 
        the Consolidated Omnibus Budget Reconciliation Act of 
        1985 (19 U.S.C. 58c), in the case of entries of 
        merchandise made under the temporary monthly entry 
        programs established by the Commissioner of Customs 
        before July 1, 1989, for the purpose of testing entry 
        processing improvements, the fee charged under section 
        13031(a)(9) of the Consolidated Omnibus Budget 
        Reconciliation Act of 1985 for each day's importations 
        at each port by the same importer from the same 
        exporter shall be the lesser of--
                  (A) $400, or
                  (B) the amount determined by applying the ad 
                valorem rate currently in effect under such 
                section 13031(a)(9) to the total value of each 
                day's importations at each port by the same 
                importer from the same exporter.
          (2) The fees described in paragraph (1) that are 
        payable under the program described in paragraph (1) 
        shall be paid with each monthly consumption entry. 
        Interest shall accrue on the fees paid monthly in 
        accordance with section 6621 of the Internal Revenue 
        Code of 1986.

SEC. 112. EXEMPTION OF ISRAELI PRODUCTS FROM CERTAIN USER FEES.

    If the United States Trade Representative determines that 
the Government of Israel has provided reciprocal concessions in 
exchange for the exemption of the products of Israel from the 
fees imposed under section 13031(a) (9) and (10) of the 
Consolidated Omnibus Budget Reconciliation Act of 1985 (as 
amended by section 111), such fees may not be charged with 
respect to any product of Israel that is entered, or withdrawn 
from warehouse for consumption, on or after the 15th day (which 
day may not be before October 1, 1990) after the date on which 
the determination is published in the Federal Register.

       Section 1893(f) of the Tax Reform Act of 1986, as amended


     [19 U.S.C. 58c note; P.L. 99-514, as amended by P.L. 100-203]

SEC. 1893. TECHNICAL AMENDMENTS RELATING TO CUSTOMS USER FEES.

           *       *       *       *       *       *       *


    (f) Reinstating Limit on Charges for Other Inspection 
Services.--Section 53 of the Airport and Airway Development Act 
of 1970 (49 U.S.C. 1741), as amended by section 13031(h)(2) of 
the Consolidated Omnibus Budget Reconciliation Act of 1985, is 
further amended by adding at the end thereof the following new 
subsection:
    ``(e)(1) The cost of any inspection or quarantine service 
which is required to be performed by the Federal Government or 
any agency thereof at airports of entry or other places of 
inspection as a consequence of the operation of aircraft, and 
which is performed during regularly established hours of 
service on Sundays or holidays shall be reimbursed by the 
owners or operators of such aircraft only to the same extent as 
if such service had been performed during regularly established 
hours of service on weekdays. Notwithstanding any other 
provision of law, administrative overhead costs associated with 
any inspection or quarantine, service required to be performed 
by the United States Government, or any agency thereof, at 
airports of entry as a result of the operation of aircraft, 
shall not be assessed against the owners or operators thereof.
    ``(2) Nothing in this subsection may be construed as 
requiring reimbursement for costs incurred by the Secretary of 
the Treasury in providing customs services described in section 
13031(e)(1) of the Consolidated Omnibus Budget Reconciliation 
Act of 1985.''.

                         I. OTHER CUSTOMS LAWS


                      1. Country of Origin Marking


           Section 304 of the Tariff Act of 1930, as amended


 [19 U.S.C. 1304; P.L. 71-361, as amended by P.L. 98-573, P.L. 99-514, 
       P.L. 100-418, P.L. 103-182, P.L. 104-295 and P.L. 106-36]

SEC. 304. MARKING OF IMPORTED ARTICLES AND CONTAINERS.

    (a) Marking of Articles.--Except as hereinafter provided, 
every article of foreign origin (or its container, as provided 
in subsection (b) hereof) imported into the United States shall 
be marked in a conspicuous place as legibly, indelibly, and 
permanently as the nature of the article (or container) will 
permit in such manner as to indicate to an ultimate purchaser 
in the United States the English name of the country of origin 
of the article. The Secretary of the Treasury may by 
regulations--
          (1) Determine the character of words and phrases or 
        abbreviations thereof which shall be acceptable as 
        indicating the country of origin and prescribe any 
        reasonable method of marking, whether by printing, 
        stenciling, stamping, branding, labeling, or by any 
        other reasonable method, and a conspicuous place on the 
        article (or container) where the marking shall appear;
          (2) Require the addition of any other words or 
        symbols which may be appropriate to prevent deception 
        or mistake as to the origin of the article or as to the 
        origin or any other article with which such imported 
        article is usually combined subsequent to importation 
        but before delivery to an ultimate purchaser; and
          (3) Authorize the exception of any article from the 
        requirements of marking if--
                  (A) Such article is incapable of being 
                marked;
                  (B) Such article cannot be marked prior to 
                shipment to the United States without injury;
                  (C) Such article cannot be marked prior to 
                shipment to the United States, except at an 
                expense economically prohibitive of its 
                importation;
                  (D) The marking of a container of such 
                article will reasonably indicate the origin of 
                such article;
                  (E) Such article is a crude substance;
                  (F) Such article is imported for use by the 
                importer and not intended for sale in its 
                imported or any other form;
                  (G) Such article is to be processed in the 
                United States by the importer or for his 
                account otherwise than for the purpose of 
                concealing the origin of such article and in 
                such manner that any mark contemplated by this 
                section would necessarily be obliterated, 
                destroyed, or permanently concealed;
                  (H) An ultimate purchaser, by reason of the 
                character of such article or by reason of the 
                circumstances of its importation, must 
                necessarily know the country of origin of such 
                article even though it is not marked to 
                indicate its origin;
                  (I) Such article was produced more than 
                twenty years prior to its importation into the 
                United States;
                  (J) Such article is of a class or kind with 
                respect to which the Secretary of the Treasury 
                has given notice by publication in the weekly 
                Treasury Decisions within two years after July 
                1, 1937, that articles of such class or kind 
                were imported in substantial quantities during 
                the five-year period immediately preceding 
                January 1, 1937, and were not required during 
                such period to be marked to indicate their 
                origin: Provided, That this subdivision shall 
                not apply after September 1, 1938, to sawed 
                lumber and timbers, telephone, trolley, 
                electric-light, and telegraph poles of wood, 
                and bundles of shingles; but the President is 
                authorized to suspend the effectiveness of this 
                proviso if he finds such action required to 
                carry out any trade agreement entered into 
                under the authority of the Act of June 12, 1934 
                (U.S.C., 1934 edition, title 19, sections 1351, 
                1352, 1353, 1354), as extended; or
                  (K) Such article cannot be marked after 
                importation except at an expense which is 
                economically prohibitive, and the failure to 
                mark the article before importation was not due 
                to any purpose of the importer, producer, 
                seller, or shipper to avoid compliance with 
                this section.
    (b) Marking of Containers.--Whenever an article is excepted 
under subdivision (3) of subsection (a) of this section from 
the requirements of marking, the immediate container if any, of 
such article, or such other container or containers of such 
article as may be prescribed by the Secretary of the Treasury, 
shall be marked in such manner as to indicate to an ultimate 
purchaser in the United States the English name of the country 
of origin of such article, subject to all provisions of this 
section, including the same exceptions as are applicable to 
articles under subdivision (3) of subsection (a) of this 
section. If articles are excepted from marking requirements 
under clause (F), (G), or (H) of subdivision (3) of subsection 
(a) of this section, their usual containers shall not be 
subject to the marking requirements of this section. Usual 
containers in use as such at the time of importation shall in 
no case be required to be marked to show the country of their 
own origin.
    (c) Marking of Certain Pipe and Fittings.--(1) Except as 
provided in paragraph (2), no exception may be made under 
subsection (a)(3) with respect to pipes of iron, steel, or 
stainless steel, to pipe fittings of steel, stainless steel, 
chrome-moly steel, or cast and malleable iron each of which 
shall be marked with the English name of the country of origin 
by means of die stamping, cast-in mold lettering, etching, 
engraving, or continuous paint stenciling.
    (2) If, because of the nature of an article, it is 
technically or commercially infeasible to mark it by one of the 
five methods specified in paragraph (1), the article may be 
marked by an equally permanent method of marking or, in the 
case of small diameter pipe, tube, and fittings, by tagging the 
containers or bundles.
    (d) Marking of Compressed Gas Cylinders.--No exception may 
be made under subsection (a)(3) with respect to compressed gas 
cylinders designed to be used for the transport and storage of 
compressed gases whether or not certified prior to exportation 
to have been made in accordance with the safety requirements of 
sections 178.36 through 178.68 of title 49, Code of Federal 
Regulations, each of which shall be marked with the English 
name of the country of origin by means of die stamping, 
molding, etching, raised lettering, or an equally permanent 
method of marking.
    (e) Marking of Certain Manhole Rings or Frames, Covers and 
Assemblies Thereof.--No exception may be made under subsection 
(a)(3) with respect to manhole rings or frames, covers, and 
assemblies thereof each of which shall be marked on the top 
surface with the English name of the country of origin by means 
of die stamping, cast-in-mold lettering, etching, engraving, or 
an equally permanent method of marking.
    (f) Marking of Certain Coffee and Tea Products.--The 
marking requirements of subsections (a) and (b) shall not apply 
to articles described in subheadings 0901.21, 0901.22, 0902.10, 
0902.20, 0902.30, 0902.40, 2101.10, and 2101.20 of the 
Harmonized Tariff Schedule of the United States, as in effect 
on January 1, 1995.
    (g) Marking of Spices.--The marking requirements of 
subsections (a) and (b) shall not apply to articles provided 
for under subheadings 0904.11, 0904.12, 0904.20, 0905.00, 
0906.10, 0906.20, 0907.00, 0908.10, 0908.20, 0908.30, 0909.10, 
0909.20, 0909.30, 0909.40, 0909.50, 0910.10, 0910.20, 0910.30, 
0910.40, 0910.50, 0910.91, 0910.99, 1106.20, 1207.40, 1207.50, 
1207.91, 1404.90, and 3302.10, and items classifiable in 
categories 0712.90.60, 0712.90.8080, 1209.91.2000, 
1211.90.2000, 1211.90.8040, 1211.90.8050, 1211.90.8090, 
2006.00.3000, 2918.13.2000, 3203.00.8000, 3301.90.1010, 
3301.90.1020, and 3301.90.1050, of the Harmonized Tariff 
Schedule of the United States, as in effect on January 1, 1995.
    (h) Marking of Certain Silk Products.--The marking 
requirements of subsections (a) and (b) shall not apply either 
to--
          (1) articles provided for in subheading 6214.10.10 of 
        the Harmonized Tariff Schedule of the united States, as 
        in effect on January 1, 1997; or
          (2) articles provided for in heading 5007 of the 
        Harmonized Tariff Schedule of the United States as in 
        effect on January 1, 1997.
    (i) Additional Duties for Failure to Mark.--If at the time 
of importation any article (or its container, as provided in 
subsection (b) of this section) is not marked in accordance 
with the requirements of this section, and if such article is 
not exported or destroyed or the article (or its container, as 
provided in subsection (b) of this section) marked after 
importation in accordance with the requirements of this section 
(such exportation, destruction, or marking to be accomplished 
under customs supervision prior to the liquidation of the entry 
covering the article, and be allowed whether or not the article 
has remained in continuous customs custody), there shall be 
levied, collected, and paid upon such article a duty of 10 per 
centum ad valorem, which shall be deemed to have accrued at the 
time of importation, shall not be construed to be penal, and 
shall not be remitted wholly or in part nor shall payment 
thereof be avoidable for any cause. Such duty shall be levied, 
collected, and paid in addition to any other duty imposed by 
law and whether or not the article is exempt from the payment 
of ordinary customs duties. The compensation and expenses of 
customs officers and employees assigned to supervise the 
exportation, destruction, or marking to exempt articles from 
the application of the duty provided for in this subsection 
shall be reimbursed to the Government by the importer.
    (j) Delivery Withheld Until Marked.--No imported article 
held in customs custody for inspection, examination, or 
appraisement shall be delivered until such article and every 
other article of the importation (or their containers), whether 
or not released from customs custody, shall have been marked in 
accordance with the requirements of this section or until the 
amount of duty estimated to be payable under subsection (i) of 
this section has been deposited. Nothing in this section shall 
be construed as excepting any article (or its container) from 
the particular requirements of marking provided for in any 
other provision of law.
    (k) Treatment of Goods of a NAFTA Country.--
          (1) Application of section.--In applying this section 
        to an article that qualifies as a good of a NAFTA 
        country (as defined in section 2(4) of the North 
        American Free Trade Agreement Implementation Act) under 
        the regulations issued by the Secretary to implement 
        Annex 311 of the North American Free Trade Agreement--
                  (A) the exemption under subsection (a)(3)(H) 
                shall be applied by substituting ``reasonably 
                know'' for ``necessarily know'';
                  (B) the Secretary shall exempt the good from 
                the requirements for marking under subsection 
                (a) if the good--
                          (i) is an original work of art, or
                          (ii) is provided for under subheading 
                        6904.10, heading 8541, or heading 8542 
                        of the Harmonized Tariff Schedule of 
                        the United States; and
                  (C) subsection (b) does not apply to the 
                usual container of any good described in 
                subsection (a)(3) (E) or (I) or subparagraph 
                (B) (i) or (ii) of this paragraph.
          (2) Petition rights of nafta exporters and producers 
        regarding marking determinations.--
                  (A) Definitions.--For purposes of this 
                paragraph:
                          (i) The term ``adverse marking 
                        decision'' means a determination by the 
                        Customs Service which an exporter or 
                        producer of merchandise believes to be 
                        contrary to Annex 311 of the North 
                        American Free Trade Agreement.
                          (ii) A person may not be treated as 
                        the exporter or producer of merchandise 
                        regarding which an adverse marking 
                        decision was made unless such person--
                                  (I) if claiming to be the 
                                exporter, is located in a NAFTA 
                                country and is required to 
                                maintain records in that 
                                country regarding exportations 
                                to NAFTA countries; or
                                  (II) if claiming to be the 
                                producer, grows, mines, 
                                harvests, fishes, traps, hunts, 
                                manufactures, processes, or 
                                assembles such merchandise in a 
                                NAFTA country.
                  (B) Intervention or petition regarding 
                adverse marking decisions.--If the Customs 
                Service makes an adverse marking decision 
                regarding any merchandise, the Customs Service 
                shall, upon written request by the exporter or 
                producer of the merchandise, provide to the 
                exporter or producer a statement of the basis 
                for the decision. If the exporter or producer 
                believes that the decision is not correct, it 
                may intervene in any protest proceeding 
                initiated by the importer of the merchandise. 
                If the importer does not file a protest with 
                regard to the decision, the exporter or 
                producer may file a petition with the Customs 
                Service setting forth--
                          (i) a description of the merchandise; 
                        and
                          (ii) the basis for its claim that the 
                        merchandise should be marked as a good 
                        of a NAFTA country.
                  (C) Effect of determination regarding 
                decision.--If, after receipt and consideration 
                of a petition filed by an exporter or producer 
                under subparagraph (B), the Customs Service 
                determines that the adverse marking decision--
                          (i) is not correct, the Customs 
                        Service shall notify the petitioner of 
                        the determination and all merchandise 
                        entered, or withdrawn from warehouse 
                        for consumption, more than 30 days 
                        after the date that notice of the 
                        determination under this clause is 
                        published in the weekly Custom Bulletin 
                        shall be marked in conformity with the 
                        determination; or
                          (ii) is correct, the Customs Service 
                        shall notify the petitioner that the 
                        petition is denied.
                  (D) Judicial review.--For purposes of 
                judicial review, the denial of a petition under 
                subparagraph (C)(ii) shall be treated as if it 
                were a denial of a petition of an interested 
                party under section 516 regarding an issue 
                arising under any of the preceding provisions 
                of this section.
    (l) Penalties.--Any person who, with intent to conceal the 
information given thereby or contained therein, defaces, 
destroys, removes, alters, covers, obscures, or obliterates any 
mark required under the provisions of this Act shall--
          (1) upon conviction for the first violation of this 
        subsection, be fined not more than $100,000, or 
        imprisoned for not more than 1 year, or both; and
          (2) upon conviction for the second or any subsequent 
        violation of this subsection, be fined not more than 
        $250,000, or imprisoned for not more than 1 year, or 
        both.

            Rule of Origin for Textile and Apparel Products


      Section 334 of the Uruguary Round Agreements Act, as amended


 [19 U.S.C. 3592; P.L. 103-465 as amended by P.L. 104-295 and P.L. 106-
                                  200]

SEC. 334. RULES OF ORIGIN FOR TEXTILE AND APPAREL PRODUCTS.

    (a) Regulatory Authority.--The Secretary of the Treasury 
shall prescribe rules and delivery in a quantity simplementing 
the principles contained in subsection (b) of this section for 
determining the origin of textiles and apparel products. Such 
rules shall be promulgated in final form not later than July 1, 
1995.
    (b) Principles.--
          (1) In general.--Except as otherwise provided for by 
        statute, a textile or apparel product, for purposes of 
        the customs laws and the administration of quantitative 
        restrictions, originates in a country, territory, or 
        insular possession, and is the growth, product, or 
        manufacture of that country, territory, or insular 
        possession, if--
                  (A) the product is wholly obtained or 
                produced in that country, territory, or 
                possession;
                  (B) the product is a yarn, thread, twine, 
                cordage, rope, cable, or braiding and--
                          (i) the constituent staple fibers are 
                        spun in that country, territory, or 
                        possession, or
                          (ii) the continuous filament is 
                        extruded in that country, territory, or 
                        possession;
                  (C) the product is a fabric, including a 
                fabric classified under chapter 59 of the HTS, 
                and the constituent fibers, filaments, or yarns 
                are woven, knitted, needled, tufted, felted, 
                entangled, or transformed by any other fabric-
                making process in that country, territory, or 
                possession; or
                  (D) the product is any other textile or 
                apparel product that is wholly assembled in 
                that country, territory, or possession from its 
                component pieces.
        (2) Special rules.--
                  (A) Notwithstanding paragraph (1)(d) and 
                except as paraded in subparagraphs (B) and (C);
                          (i) the origin of a good that is 
                        classified under one of the following 
                        HTS headings or subheadings shall be 
                        determined under subparagraph (A), (B), 
                        (C) of paragraph (1), as appropriate: 
                        5609, 5807, 5811, 6209.20.40, 6213, 
                        6214, 6301, 6302, 6303, 6304, 6305, 
                        6306, 6307.10, 6307.90, 6308, or 
                        9404.90; and
                          (ii) a textile or apparel product 
                        which is knit to shape shall be 
                        considered to originate in, and be the 
                        growth, product, or manufacture of, the 
                        country, territory, or possession in 
                        which it is knit.
                  (B) Notwithstanding paragraph (1)(C), fabric 
                classified under the HTS as of silk, cotton, 
                man-made fiber, or vegetable fiber shall be 
                considered to originate in, and be the growth, 
                product, or manufacture of, the country, 
                territory, or possession in which the fabric is 
                both dyed and printed when accompanied by two 
                or more of the following finishing operations: 
                bleaching, shrinking, fulling, napping, 
                decating, permanent stiffening, weighting, 
                permanent embossing, or moireing.
                  (C) Notwithstanding paragraph (1)(D) goods 
                classified under HTS heading 6117.10, 6213.00, 
                6214.00, 6302.22, 6302.29, 6302.52, 6302.53, 
                6302.59, 6302.93, 6302.99, 6303.92, 6303.99, 
                6304.19, 6304.93, 6304.99, 9404.90.85, or 
                9404.90.95, except for goods classified under 
                such headings as of cotton or of wool or 
                consisting of fiber blends containing 16 
                percent or more by weight of cotton, shall be 
                considered to originate in, and be the growth, 
                product, or manufacture of, the country, 
                territory, or possession in which the fabric is 
                both dyed and printed when accompanied by two 
                or more of the following finishing operations: 
                bleaching, shrinking, fulling, napping, 
                decating, permanent stiffening, weighting, 
                permanent embossing, or moireing;
          (3) Multicountry rule--If the origin of a good cannot 
        be determined under paragraph (1) or (2), then that 
        good shall be considered to originate in, and be the 
        growth, product, or manufacture of--
                  (A) the country, territory, or possession in 
                which the most important assembly or 
                manufacturing process occurs, or
                  (B) if the origin of the good cannot be 
                determined under subparagraph (A), the last 
                county, territory, or possession in which 
                important assembly or manufacturing occurs.
          (4) Components Cut in the United States.--
                  (A) The value of a component that is cut to 
                shape (but not to length, width, or both) in 
                the United States from foreign fabric and 
                exported to another country, territory, or 
                insular possession for assembly into an article 
                that is then returned to the United States--
                          (i) shall not be included in the 
                        dutiable value of such article, and
                          (ii) may be applied toward 
                        determining the percentage referred to 
                        in General Note 7(b)(i)(B) of the HTS, 
                        subject to the limitation provided in 
                        that note.
                  (B) No article (except a textile or apparel 
                product) assembled in whole of components 
                described in subparagraph (A), or of such 
                components and components that are products of 
                the United States, in a beneficiary country as 
                defined in General Note 7(a) of the HTS shall 
                be treated as a foreign article, or as subject 
                to duty if--
                          (i) the components after exportation 
                        from the United States, and
                          (ii) the article itself before 
                        importation in the United States do not 
                        enter into the commerce of any foreign 
                        country other than such a beneficiary 
                        country.
          (5) Exception for United States-Israel Free Trade 
        Agreement--This section shall not affect, for purposes 
        of the customs laws and administration of quantitative 
        restrictions, the status of goods that, under rulings 
        and administrative practices in effect immediately 
        before the enactment of this Act, would have originated 
        in, or been the growth, product, or manufacture of, a 
        country that is a party to an agreement with the United 
        States establishing a free trade area, which entered 
        into force before January 1, 1987. For such purposes, 
        such rulings and administrative practices that were 
        applied, immediately before the enactment of this Act, 
        to determine the origin of textile and apparel products 
        covered by such agreement shall continue to apply after 
        the enactment of this Act, and on and after the 
        effective date described in subsection (c) of this 
        section, unless such rulings and practices are modified 
        by the mutual consent of the parties to the agreement.
    (c) Effective Date.--This section shall apply to goods 
entered, or withdrawn from warehouse, for consumption on or 
after July 1, 1996, except that this section shall not apply to 
goods if--
          (1) the contract for the sale of such goods to the 
        United States is entered into before July 20, 1994;
          (2) all of the material terms of sale in such 
        contract, including the price and quantity of the 
        goods, are fixed and determinable before July 20, 1994;
          (3) a copy of the contract is filed with the 
        Commissioner of Customs within 60 days after December 
        8, 1994, together with a certification that the 
        contract meets the requirements of paragraphs (1) and 
        (2); and
          (4) the goods are entered, or withdrawn from 
        warehouse, for consumption on or before January 1, 
        1998.
The origin of goods to which this section does not apply shall 
be determined in accordance with the applicable rules in effect 
on July 20, 1994.

 Section 1907 (b) and (c) of the Omnibus Trade and Competitiveness Act 
                                of 1988


                     [19 U.S.C. 1304; P.L. 100-418]

SEC. 1907. IMPORT MARKING PROVISIONS.

           *       *       *       *       *       *       *


    (b) Marking of Containers of Imported Mushrooms.--Imported 
preserved mushrooms shall not be considered to be in compliance 
with section 304 of the Tariff Act of 1930 (19 U.S.C. 1304) or 
any other law relating to the marking of imported articles 
unless the containers thereof indicate in English the country 
in which the mushrooms were grown.
    (c) Native-American Style Jewelry and Native-American Style 
Arts and Crafts.--By no later than the date that is 1 year 
after the date of enactment of this Act, the Secretary of the 
Treasury shall prescribe and implement regulations under 
section 304 of the Tariff Act of 1930 (19 U.S.C. 1304) which 
require, to the greatest extent possible, that all Native-
American style jewelry and Native-American style arts and 
crafts that are imported into the United States have the 
English name of the country of origin of such jewelry or arts 
and crafts indelibly marked in a conspicuous place on such 
jewelry or arts and crafts by a permanent method of marking.
    [Section 207(b) of the NAFTA Implementation Act provides 
that: Articles that qualify as goods of a NAFTA country under 
regulations issued by the Secretary in accordance with Annex 
311 of the Agreement are exempt from the marking requirements 
promulgated by the Secretary of the Treasury under section 
1907(c) of the Omnibus Trade and Competitiveness Act of 1988 
(Public Law 100-418), but are subject to the requirements of 
section 304 of the Tariff Act of 1930 (19 U.S.C. 1304).]

   Section 210 of the Motor Vehicle Information and Cost Savings Act


[15 U.S.C. 1901 et seq.; P.L. 92-513, as added by P.L. 102-388, section 
                                  355]

SEC. 210. LABELING REQUIREMENTS FOR AUTOMOBILES.

    (a) Short Title.--This section may be cited as the 
``American Automobile Labeling Act''.
    (b) Label Requirement.--(1) Each manufacturer of a new 
passenger motor vehicle distributed in commerce for sale in the 
United States shall annually establish for each model year and 
cause to be affixed, and each dealer shall cause to be 
maintained, on each such vehicle manufactured on or after 
October 1, 1994, in a prominent place, one or more labels--
          (A) indicating the percentage (by value) of passenger 
        motor vehicle equipment installed on such vehicle 
        within a carline which originated in the United States 
        and Canada to be identified with the words ``U.S./
        Canadian content'';
          (B) indicating the final assembly point by city, 
        State (where appropriate), and country of such 
        automobile;
          (C) in the case of any country (other than the United 
        States and Canada) in which 15 percent or more (by 
        value) of equipment installed on passenger motor 
        vehicles within a carline originated, indicating the 
        names of at least the 2 countries in which the greatest 
        amount (by value) of such equipment originated and the 
        percentage (by value) of the equipment originating in 
        each such country;
          (D) indicating the country of origin of the engine 
        for each passenger motor vehicle; and
          (E) indicating the country of origin of the 
        transmission for each passenger motor vehicle.
    (2) The percentages required to be indicated by this 
section may be rounded to the nearest 5 percent by the 
manufacturers. Such percentage shall be established at the 
beginning of each model year for such carline and shall be 
applicable to that carline for the entire model year.
    (3) The disclosure requirement of subparagraph (1)(B) of 
this section supersedes the disclosure requirement of section 
3(b) of the Automobile Information Disclosure Act (15 U.S.C. 
1232(b)). A manufacturer who indicates the final assembly point 
as required by this section shall be deemed to have satisfied 
the disclosure requirement imposed by section 3(b) of the 
Automobile Information Disclosure Act.
    (c) Form and Content of Label.--The form and content of the 
label required under subsection (b), and the manner and 
location in which such label shall be affixed, shall be 
prescribed by the Secretary by rule. The Secretary shall permit 
a manufacturer to comply with this section by allowing such 
manufacturer to disclose the information required under this 
section on the label required by section 3 of the Automobile 
Information Disclosure Act (15 U.S.C. 1232), on the label 
required by section 506 of the Motor Vehicle Information and 
Cost Savings Act (15 U.S.C. 2006), or on a readily visible 
separate label.
    (d) Regulations.--The Secretary, in consultation with the 
Secretary of Commerce and the Secretary of the Treasury, shall 
promulgate such regulations as may be necessary to carry out 
this section, including regulations to establish a procedure to 
verify the labeling information required by this section. Such 
regulations shall provide to the ultimate purchaser of a new 
passenger motor vehicle the best and most understandable 
information possible about the foreign and U.S./Canada origin 
of the equipment of such vehicles without imposing costly and 
unnecessary burdens on the manufacturers. The regulations shall 
be promulgated promptly after the enactment of this section in 
order to provide adequate lead time for all manufacturers to 
comply with this section. The regulations shall include 
provisions applicable to outside and allied suppliers to 
require such suppliers to certify whether a component provided 
by such suppliers is U.S./Canada or foreign and to provide such 
other information as may be necessary, as determined by the 
Secretary, to enable the manufacturer to reasonably comply with 
the provisions of this section and to reply on such 
certification and information. The regulations applicable to 
all suppliers shall be enforceable as a regulation of the 
Secretary under the appropriate provisions of this Act.
    (e) Violations and Penalties.--Any manufacturer of 
automobiles distributed in commerce for sale in the United 
States who willfully fails to affix to any new automobile so 
manufactured or imported by him for sale in the United States 
the label required by this section, or any dealer who fails to 
maintain such label as required by this section, shall be fined 
not more than $1,000. Such failure with respect to each 
automobile shall constitute a separate offense.
    (f) Definitions.--For purposes of this section--
          (1) The term ``manufacturer'' means any person 
        engaged in the manufacturing or assembling of new 
        automobiles, including any person importing new 
        automobiles, including any person importing new 
        automobiles for resale and any person who acts for and 
        is under the control of such manufacturer, assembler, 
        or importer in connection with the distribution of new 
        automobiles.
          (2) The term ``person'' means an individual, 
        partnership, corporation, business trust, or any 
        organized group of persons.
          (3) The term ``passenger motor vehicle'' has the 
        meaning provided in section 2(1) of this Act, except 
        that it shall include any multipurpose vehicle and 
        light duty truck that is rated at 8,500 pounds gross 
        vehicle weight or less.
          (4) The term ``passenger motor vehicle equipment'' 
        means any system, subassembly, or component received at 
        the final vehicle assembly point for installation on, 
        or attachment to, such vehicle at the time of its 
        initial shipment by the manufacturer to a dealer for 
        sale to an ultimate purchaser. The term ``component'' 
        shall not include minor parts, such as attachment 
        hardware (nuts, bolts, clips, screws, pins, braces, 
        etc.) and such other similar items as the Secretary, in 
        consultation with manufacturers and labor, may 
        prescribe by rule.
          (5) The terms ``originated in the United States and 
        Canada'', ``U.S./Canadian'', and ``of U.S./Canadian 
        origin'', in referring to automobile equipment, mean:
                  (A) for outside suppliers, the purchase price 
                of automobile equipment which contains at least 
                70 percent value added in the United States and 
                Canada; and
                  (B) for allied suppliers, the manufacturer 
                shall determine the foreign content of any 
                passenger motor vehicle equipment supplied by 
                the allied supplier by adding up the purchase 
                price of all foreign material purchased from 
                outside suppliers that comprise the individual 
                passenger motor vehicle equipment and 
                subtracting such purchase price from the total 
                purchase price of such equipment. Determination 
                of foreign or U.S./Canadian origin from outside 
                suppliers will be consistent with subparagraph 
                (A).
          (6) The term ``new passenger motor vehicle'' means a 
        passenger motor vehicle the equitable or legal title to 
        which has never been transferred by a manufacturer, 
        distributor, or dealer to an ultimate purchaser.
          (7) The term ``dealer'' means any person or resident 
        located in the United States, including any territory 
        of the United States, or the District of Columbia, 
        engaged in the sale or distribution of new automobiles 
        to the ultimate purchaser.
          (8) The term ``Secretary'' means the Secretary of 
        Transportation.
          (9) The term ``State'' includes each of the several 
        States, the District of Columbia, the Commonwealth of 
        Puerto Rico, Guam, the Virgin Islands, the Canal Zone, 
        and American Samoa.
          (10)(A) The term ``value added in the United States 
        and Canada'' means a percentage derived as follows: 
        Value Added equals the total purchase price, minus 
        total purchase price of foreign content, divided by the 
        total purchase price.
Costs incurred or profits made at the final vehicle assembly 
point and beyond (i.e., advertising, assembly, labor, interest 
payments, profits, etc.) shall not be included in such 
calculation.
          (B) In determining the origin and value added of 
        engines and transmissions, the following groupings will 
        be used:
                  (1) Engines of same displacement produced at 
                the same plant.
                  (2) Transmissions of the same type produced 
                at the same plant.
          (11) The term ``carline'' means a name denoting a 
        group of vehicles which has a degree of commonality in 
        construction (e.g., body, chassis). Carline does not 
        consider any level of decor or opulence and is not 
        generally distinguished by such characteristics as roof 
        line, number of doors, seats, or windows, except for 
        light duty trucks. Light duty trucks are considered to 
        be different carlines than passenger cars.
          (12) The term ``country of origin'', in referring to 
        the origin of an engine or transmission, means the 
        country in which 50 percent or more of the dollar value 
        added of an engine or transmission originated. If no 
        country accounts for 50 percent or more of the dollar 
        value, then the country of origin is the country from 
        which the largest share of the value added originated. 
        The estimate of the percentage of the dollar value 
        shall be based upon the purchase price of direct 
        materials as received at individual engine or 
        transmission plants of engines of the same displacement 
        and transmissions of the same transmission type. For 
        the purpose of determining the country of origin for 
        engines and transmissions, the United States and Canada 
        shall be treated separately.
          (13) When used in reference to passenger motor 
        vehicle equipment which is of U.S./Canadian origin, the 
        term ``percentage (by value)'' means the resulting 
        percentage when the percentage (by value) of such 
        equipment not of U.S./Canadian origin that will be 
        installed or included on such vehicles produced within 
        a carline is subtracted from 100 percent. Value shall 
        be expressed in terms of purchase price. For both 
        outside suppliers and allied suppliers the value used 
        shall be the purchase price of the passenger motor 
        vehicle equipment as paid at the final assembly point.
          (14) The term ``final assembly point'' shall mean the 
        plant, factory, or other place at which a new passenger 
        motor vehicle is produced or assembled by a 
        manufacturer and from which such vehicle is delivered 
        to a dealer or importer in such a condition that all 
        component parts necessary to the mechanical operation 
        of such automobile are included with such vehicle 
        whether or not such component parts are permanently 
        installed in or on such vehicle.
          (15) The term ``allied supplier'' means a supplier of 
        passenger motor vehicle equipment that is wholly owned 
        by the manufacturer, or in the case of a joint venture 
        vehicle assembly arrangement, any supplier that is 
        wholly owned by one member of the joint venture 
        arrangement.
          (16) The terms ``foreign'' or ``foreign content'' 
        mean passenger motor vehicle equipment not determined 
        to be U.S./Canadian origin.
          (17) The term ``outside supplier'' means a supplier 
        of passenger motor vehicle equipment to a 
        manufacturer's allied supplier or anyone other than an 
        allied supplier who ships directly to the 
        manufacturer's final assembly point.
    (g) Effect on State Law.--(1) Whenever a content labeling 
requirement established under this section is in effect, no 
State or political subdivision of a State shall have the 
authority to adopt or enforce any law or regulation relating to 
the content of vehicles covered by such Federal requirement.
    (2) Nothing in this section shall be construed to prevent 
any State or political subdivision thereof from establishing 
requirements with respect to content of automobiles procured 
for its own use.

                              2. Drawback


           Section 313 of the Tariff Act of 1930, as amended


 [19 U.S.C. 1313; P.L. 71-361, as amended by Act of June 26, 1936; Act 
of Aug. 8, 1951; Act of Aug. 8, 1953; Act of Aug. 6, 1956; P.L. 85-673; 
 P.L. 90-630; P.L. 91-692; P.L. 96-609; P.L. 98-573; P.L. 99-514, P.L. 
 100-449, P.L. 101-382, P.L. 103-182, P.L. 103-465, P.L. 104-295, P.L. 
                       106-36, and P.L. 106-476]

SEC. 313. DRAWBACK AND REFUNDS.

    (a) Articles Made From Imported Merchandise.--Upon the 
exportation or destruction under customs supervision of 
articles manufactured or produced in the United States with the 
use of imported merchandise provided that those articles have 
not been used prior to such exportation or destruction, the 
full amount of the duties paid upon the merchandise so used 
shall be refunded as drawback, less 1 per centum of such 
duties, except that such duties shall not be so refunded upon 
the exportation or destruction of flour or by-products produced 
from imported wheat. Where two or more products result from the 
manipulation of imported merchandise, the drawback shall be 
distributed to the several products in accordance with their 
relative values at the time of separation.
    (b) Substitution for Drawback Purposes.--If imported duty-
paid merchandise and any other merchandise (whether imported or 
domestic) of the same kind and quality are used in the 
manufacture or production of articles within a period not to 
exceed three years from the receipt of such imported 
merchandise by the manufacturer or producer of such articles, 
there shall be allowed upon the exportation, or destruction 
under customs supervision, of any such articles, 
notwithstanding the fact that none of the imported merchandise 
may actually have been used in the manufacture or production of 
the exported or destroyed articles, an amount of drawback equal 
to that which would have been allowable had the merchandise 
used therein been imported, but only if those articles have not 
been used prior to such exportation or destruction; but the 
total amount of drawback allowed upon the exportation or 
destruction under customs supervision of such articles, 
together with the total amount of drawback allowed in respect 
of such imported merchandise under any other provision of law, 
shall not exceed 99 per centum of the duty paid on such 
imported merchandise.
    (c) Merchandise Not Conforming to Sample or 
Specifications.--Upon the exportation, or destruction under the 
supervision of the Customs Service, of merchandise--
          (1) not conforming to sample or specifications, 
        shipped without the consent of the consignee, or 
        determined to be defective as of the time of 
        importation;
          (2) upon which the duties have been paid;
          (3) which has been entered or withdrawn for 
        consumption; and
          (4) which, within 3 years after release from the 
        custody of the Customs Service, has been returned to 
        the custody of the Customs Service for exportation or 
        destruction under the supervision of the Customs 
        Service;
the full amount of the duties paid upon such merchandise, less 
1 percent, shall be refunded as drawback.
    (d) Flavoring Extracts; Medicinal or Toilet Preparations; 
Bottled Distilled Spirits and Wines.--Upon the exportation of 
flavoring extracts, medicinal or toilet preparations (including 
perfumery) manufactured or produced in the United States in 
part from domestic alcohol on which an internal-revenue tax has 
been paid, there shall be allowed a drawback equal in amount to 
the tax found to have been paid on the alcohol so used.
    Upon the exportation of bottled distilled spirits and wines 
manufactured or produced in the United States on which an 
internal-revenue tax has been paid or determined, there shall 
be allowed, under regulations to be prescribed by the 
Commissioner of Internal Revenue, with the approval of the 
Secretary of the Treasury, a drawback equal in amount to the 
tax found to have been paid or determined on such bottled 
distilled spirits, the preceding sentence shall not apply 
unless the claim for drawback is filed by the bottler or 
packager of the spirits have been stamped or restamped, and 
marked, especially for export, under regulations prescribed by 
the Commissioner of Internal Revenue, with the approval of the 
Secretary of the Treasury.
    (e) Imported Salt for Curing Fish.--Imported salt in bond 
may be used in curing fish taken by vessels licensed to engage 
in the fisheries, and in curing fish on the shores of the 
navigable waters of the United States, whether such fish are 
taken by licensed or unlicensed vessels, and upon proof that 
the salt has been used for either of such purposes, the duties 
on the same shall be remitted.
    (f) Exportation of Meats Cured With Imported Fish.--Upon 
the exportation of meats, whether packed or smoked, which have 
been cured in the United States with imported salt, there shall 
be refunded, upon satisfactory proof that such meats have been 
cured with imported salt, the duties paid on the salt so used 
in curing such exported meats, in amounts not less than $100.
    (g) Materials for Construction and Equipment of Vessels 
Built for Foreigners.--The provisions of this section shall 
apply to materials imported and used in the construction and 
equipment of vessels built for foreign account and ownership, 
or for the government of any foreign country, notwithstanding 
that such such vessels may not within the strict meaning of the 
term be articles exported.
    (h) Jet Aircraft Engines.--Upon the exportation of jet 
aircraft engines manufactured or produced abroad that have been 
overhauled, repaired, rebuilt, or reconditioned in the United 
States with the use of imported merchandise, including parts, 
there shall be refunded, upon satisfactory proof that such 
imported merchandise has been so used, the duties which have 
been paid thereon, in amounts not less than $100.
    (i) Time Limitation on Exportation.--No drawback shall be 
allowed under the provisions of this section unless the 
completed article is exported within five years after 
importation of the imported merchandise.
    (j) Unused Merchandise Drawback.--
          (1) If imported merchandise, on which was paid any 
        duty, tax, or fee imposed under Federal law because of 
        its importation--
                  (A) is, before the close of the 3-year period 
                beginning on the date of importation--
                          (i) exported, or
                          (ii) destroyed under customs 
                        supervision; and
                  (B) is not used within the United States 
                before such exportation or destruction;
        then upon such exportation or destruction 99 percent of 
        the amount of each duty, tax, or fee so paid shall be 
        refunded as drawback. The exporter (or destroyer) has 
        the right to claim drawback under this paragraph, but 
        may endorse such right to the importer or any 
        intermediate party.
          (2) Subject to paragraph (4), if there is, with 
        respect to imported merchandise on which was paid any 
        duty, tax, or fee imposed under Federal law because of 
        its importation, any other merchandise (whether 
        imported or domestic), that--
                  (A) is commercially interchangeable with such 
                imported merchandise;
                  (B) is, before the close of the 3-year period 
                beginning on the date of importation of the 
                imported merchandise, either exported or 
                destroyed under customs supervision; and
                  (C) before such exportation or destruction--
                          (i) is not used within the United 
                        States, and
                          (ii) is in the possession of, 
                        including ownership while in bailment, 
                        in leased facilities, in transit to, or 
                        in any other manner under the 
                        operational control of, the party 
                        claiming drawback under this paragraph, 
                        if that party--
                                  (I) is the importer of the 
                                imported merchandise, or
                                  (II) received from the person 
                                who imported and paid any duty 
                                due on the imported merchandise 
                                a certificate of delivery 
                                transferring to the party the 
                                imported merchandise, 
                                commercially interchangeable 
                                merchandise, or any combination 
                                of imported and commercially 
                                interchangeable merchandise 
                                (and any such transferred 
                                merchandise, regardless of its 
                                origin, will be treated as the 
                                imported merchandise and any 
                                retained merchandise will be 
                                treated as domestic 
                                merchandise);
        then upon the exportation or destruction of such other 
        merchandise the amount of each such duty, tax, and fee 
        paid regarding the imported merchandise shall be 
        refunded as drawback, but in no case may the total 
        drawback on the imported merchandise, whether available 
        under this paragraph or any other provision of law or 
        any combination thereof, exceed 99 percent of that 
        duty, tax, or fee.
          (3) The performing of any operation or combination of 
        operations (including, but not limited to, testing, 
        cleaning, repacking, inspecting, sorting, refurbishing, 
        freezing, blending, repairing, reworking, cutting, 
        slitting, adjusting, replacing components, relabeling, 
        disassembling, and unpacking), not amounting to 
        manufacture or production for drawback purposes under 
        the preceding provisions of this section on--
                  (A) the imported merchandise itself in cases 
                to which paragraph (1) applies, or
                  (B) the commercially interchangeable 
                merchandise in cases to which paragraph (2) 
                applies,
        shall not be treated as a use of that merchandise for 
        purposes of applying paragraph (1)(B) or (2)(C).
          (4) Effective upon the entry into force of the North 
        American Free Trade Agreement, the exportation to a 
        NAFTA country, as defined in section 2(4) of the North 
        American Free Trade Agreement Implementation Act, of 
        merchandise that is fungible with and substituted for 
        imported merchandise, other than merchandise described 
        in paragraphs (1) through (8) of section 203(a) of that 
        Act, shall not constitute an exportation for purposes 
        of paragraph (2).
    (k) For purposes of subsections (a) and (b), the use of any 
domestic merchandise acquired in exchange for imported 
merchandise of the same kind and quality shall be treated as 
the use of such imported merchandise if no certificate of 
delivery is issued with respect to such imported merchandise.
    (l) Regulations.--Allowance of the privileges provided for 
in this section shall be subject to compliance with such rules 
and regulations as the Secretary of the Treasury shall 
prescribe, which may include, but need not be limited to, the 
authority for the electronic submission of drawback entries and 
the designation of the person to whom any refund or payment of 
drawback shall be made.
    (m) Source of Payment.--Any drawback of duties that may be 
authorized under the provisions of this chapter shall be paid 
from the customs receipts of Puerto Rico, if the duties were 
originally paid into the Treasury of Puerto Rico.
    (n)(1) For purposes of this subsection and subsection (o)--
          (A) the term ``NAFTA Act'' means the North American 
        Free Trade Agreement Implementation Act;
          (B) the terms ``NAFTA country'' and ``good subject to 
        NAFTA drawback'' have the same respective meanings that 
        are given such terms in sections 2(4) and 203(a) of the 
        NAFTA Act; and
          (C) a refund, waiver, or reduction of duty under 
        paragraph (2) of this subsection or paragraph (1) of 
        subsection (o) is subject to section 508(b)(2)(B).
    (2) For purposes of subsections (a), (b), (f), (h), (p), 
and (q), if an article that is exported to a NAFTA country is a 
good subject to NAFTA drawback, no customs duties on the good 
may be refunded, waived, or reduced in an amount that exceeds 
the lesser of--
          (A) the total amount of customs duties paid or owed 
        on the good on importation into the United States, or
          (B) the total amount of customs duties paid on the 
        good to the NAFTA country.
    (3) If Canada ceases to be a NAFTA country and the 
suspension of the operation of the United States-Canada Free-
Trade Agreement thereafter terminates, then for purposes of 
subsections (a), (b), (f), (h), (j)(2), and (q), the shipment 
to Canada during the period such Agreement is in operation of 
an article made from or substituted for, as appropriate, a 
drawback eligible good under section 204(a) of the United 
States-Canada Free-Trade Implementation Act of 1988 does not 
constitute an exportation.
    (o)(1) For purposes of subsection (g), if--
          (A) a vessel is built for the account and ownership 
        of a resident of a NAFTA country or the government of a 
        NAFTA country, and
          (B) imported materials that are used in the 
        construction and equipment of the vessel are goods 
        subject to NAFTA drawback,
the amount of customs duties refunded, waived, or reduced on 
such materials may not exceed the lesser of the total amount of 
customs duties paid or owed on the materials on importation 
into the United States or the total amount of customs duties 
paid on the vessel to the NAFTA country.
    (2) If Canada ceases to be a NAFTA country and the 
suspension of the operation of the United States-Canada Free-
Trade Agreement thereafter terminates, then for purposes of 
subsection (g), vessels built for Canadian account and 
ownership, or for the Government of Canada, may not be 
considered to be built for any foreign account and ownership, 
or for the government of any foreign country, except to the 
extent that the materials in such vessels are drawback eligible 
goods under section 204(a) of the United States-Canada Free-
Trade Implementation Act of 1988. [Section 213(c) of the North 
American Free Trade Agreement Implementation Act provides that 
these amendments made by section 203(b) of that Act apply
          (A) with respect to exports from the United States to 
        Canada--
                  (i) on January 1, 1996, if Canada is a NAFTA 
                country on that date, and
                  (ii) after such date for so long as Canada 
                continues to be a NAFTA country; and
          (B) with respect to exports from the United States to 
        Mexico--
                  (i) on January 1, 2001, if Mexico is a NAFTA 
                country on that date; and
                  (ii) after such date for so long as Mexico 
                continues to be a NAFTA country.]
    (p) Substitution of Finished Petroleum Derivatives.--\1\
---------------------------------------------------------------------------
    \1\ Section 2420(e) of P.L. 106-36 provides that the amendments 
made to subsections 313(p)(1), 313(p)(2), 313(p)(3), 
313(p)(3)(A)(1)(II), and 313(p)(3)(A)(ii) ``shall take effect as if 
included in the amendment made by section 632(a)(6) of the North 
American Free Trade Agreement Implementation Act. For purposes of 
section 632(b) of that Act, the 3-year requirement set forth in section 
313(r) of the Tariff Act of 1930 shall not apply to any drawback claim 
filed within 6 months after the date of the enactment of this Act for 
which that 3-year period would have expired.''
---------------------------------------------------------------------------
          (1) In general.--Notwithstanding any other provision 
        of this section, if--
                  (A) an article (hereafter referred to in this 
                subsection as the ``exported article'') of the 
                same kind and quality as a qualified article is 
                exported;
                  (B) the requirements set forth in paragraph 
                (2) are met; and
                  (C) a drawback claim is filed regarding the 
                exported article; drawback shall be allowed as 
                described in paragraph (4).
          (2) Requirements.--The requirements referred to in 
        paragraph (1) are as follows:
                  (A) The exporter of the exported article--
                          (i) manufactured or produced a 
                        qualified article in a quantity equal 
                        to or greater than the quantity of the 
                        exported article,
                          (ii) purchased or exchanged, directly 
                        or indirectly, a qualified article from 
                        a manufacturer or producer described in 
                        subsection (a) or (b) in a quantity 
                        equal to or greater than the quantity 
                        of the exported article,
                          (iii) imported a qualified article in 
                        a quantity equal to or greater than the 
                        quantity of the exported article, or
                          (iv) purchased or exchanged, directly 
                        or indirectly, a qualified article from 
                        an importer in a quantity equal to or 
                        greater than the quantity of the 
                        exported article.
                  (B) In the case of the requirement described 
                in subparagraph (A)(ii), the manufacturer or 
                producer produced the qualified article in a 
                quantity equal to or greater than the quantity 
                of the exported article.
                  (C) In the case of the requirement of 
                subparagraph (A)(i) or (A)(ii), the exported 
                article is exported during the period that the 
                qualified article described in subparagraph 
                (A)(i) or (A)(ii) (whichever is applicable) is 
                manufactured or produced, or within 180 days 
                after the close of such period.
                  (D) In the case of the requirement of 
                subparagraph (A)(i) or (A)(ii), the specific 
                petroleum refinery or production facility which 
                made the qualified article concerned is 
                identified.
                  (E) In the case of the requirement of 
                subparagraph (A)(iii) or (A)(iv), the exported 
                article is exported within 180 days after the 
                date of entry of an imported qualified article 
                described in subparagraph (A)(iii) or (A)(iv) 
                (whichever is applicable).
                  (F) Except as otherwise specifically provided 
                in this subsection, the drawback claimant 
                complies with all requirements of this section, 
                including providing certificates which 
                establish the drawback eligibility of articles 
                for which drawback is claimed.
                  (G) The manufacturer, producer, importer, 
                transferor, exporter, and drawback claimant of 
                the qualified article and the exported article 
                maintain all records required by regulation.
          (3) Definition of qualified article, etc.--For 
        purposes of this subsection--
                  (A) The term `qualified article' means an 
                article--
                          (i) described in--
                                  (I) headings 2707, 2708, 
                                2709.00, 2710, 2711, 2712, 
                                2713, 2714, 2715, 2901, and 
                                2902, and subheadings 
                                2903.21.00, 2909.19.14, 
                                2917.36, 2917.39.04, 
                                2917.39.15, 2926.10.00, 
                                3811.21.00 and 3811.90.00 of 
                                the Harmonized Tariff Schedule 
                                of the United States, or
                                  (II) headings 3901 through 
                                3914 of such Schedule (as such 
                                headings apply to the primary 
                                forms provided under Note 6 to 
                                chapter 39 of the Harmonized 
                                Tariff Schedule of the United 
                                States), and
                          (ii) which is--
                                  (I) manufactured or produced 
                                as described in subsection (a) 
                                or (b) from crude petroleum or 
                                a petroleum derivative,
                                  (II) imported duty-paid, or
                                  (III) an article of the same 
                                kind and quality as described 
                                in subparagraph (B), or any 
                                combination thereof, that is 
                                transferred, as so certified in 
                                a certificate of delivery or 
                                certificate of manufacture and 
                                delivery in a quantity not 
                                greater than the quantity of 
                                articles purchased or 
                                exchanged. The transferred 
                                merchandise described in 
                                subclause (III), regardless of 
                                its origin, so designated on 
                                the certificate of delivery or 
                                certificate of manufacture and 
                                deliver shall be the qualified 
                                article for purposes of this 
                                section. A party who issues a 
                                certificate of delivery, or 
                                certificate of manufacture and 
                                delivery, shall also certify to 
                                the Commissioner of Customs 
                                that it has not, and will not, 
                                issue such certificates for a 
                                quantity greater than the 
                                amount eligible for drawback 
                                and that appropriate records 
                                will be maintained to 
                                demonstrate that fact.
                  (B) An article, including an imported, 
                manufactured, substituted, or exported article, 
                is of the same kind and quality as the 
                qualified article for which it is substituted 
                under this subsection if it is a product that 
                is commercially interchangeable with or 
                referred to under the same eight-digit 
                classification of the Harmonized Tariff 
                Schedule of the United States as the qualified 
                article. If an article is referred to under the 
                same eight-digit classification of the 
                Harmonized Tariff Schedule of the United States 
                as the qualified article on January 1, 2000, 
                then whether or not the article has been 
                reclassified under another eight-digit 
                classification after January 1, 2000, the 
                article shall be deemed to be an article that 
                is referred to under the same eight-digit 
                classification of such Schedule as the 
                qualified article for purposes of the preceding 
                sentence.
                  (C) The term ``drawback claimant'' means the 
                exporter of the exported article or the 
                refiner, producer, or importer of either the 
                qualified article or the exported article. Any 
                person eligible to file a drawback claim under 
                this subparagraph may designate another person 
                to file such claim.
          (4) Limitation on drawback.--The amount of drawback 
        payable under this subsection shall not exceed the 
        amount of drawback that would be attributable to the 
        article--
                  (A) manufactured or produced under subsection 
                (a) or (b) by the manufacturer or producer 
                described in clause (i) or (ii) of paragraph 
                (2)(A), or
                  (B) imported under clause (iii) or (iv) of 
                paragraph (2)(A), had the claim qualified for 
                drawback under subsection (j).
    (q) Packaging Material.--
        (1) In General.--Packaging material, when used on or 
        for articles or merchandise exported or destroyed under 
        subsection (a), (b), (c), or (j), shall be eligible 
        under such subsection for refund, as drawback, of 99 
        percent of any duty, tax, or fee imposed under Federal 
        law on the importation of such material.
        (2) Additional eligibility.--Packaging material 
        produced in the United States, which is used by the 
        manufacturer or any other person on or for articles 
        which are exported or destroyed under subsection (a) or 
        (b), shall be eligible under such subsection for 
        refund, as drawback, of 99 percent of any duty, tax, or 
        fee importation of such material used to manufacture or 
        produce the packaging material.
    (r) Filing Drawback Claims.--
          (1) A drawback entry and all documents necessary to 
        complete a drawback claim, including those issued by 
        the Customs Service, shall be filed or applied for, as 
        applicable, within 3 years after the date of 
        exportation or destruction of the articles on which 
        drawback is claimed, except that any landing 
        certificate required by regulation shall be filed 
        within the time limit prescribed in such regulation. 
        Claims not completed within the 3-year period shall be 
        considered abandoned. No extension will be granted 
        unless it is established that the Customs Service was 
        responsible for the untimely filing.
          (2) A drawback entry for refund filed pursuant to any 
        subsection of this section shall be deemed filed 
        pursuant to any other subsection of this section should 
        it be determined that drawback is not allowable under 
        the entry as originally filed but is allowable under 
        such other subsection.
          (3)(A) The Customs Service may, notwithstanding the 
        limitation set forth in paragraph (1), extend the time 
        for filing a drawback claim for a period not to exceed 
        18 months, if--
                  (i) the claimant establishes to the 
                satisfaction of the Customs Service that the 
                claimant was unable to file the drawback claim 
                because of an event declared by the President 
                to be a major disaster on or after January 1, 
                1994; and
                  (ii) the claimant files a request for such 
                extension with the Customs Service--
                          (I) within 1 year from the last day 
                        of the 3-year period referred to in 
                        paragraph (1), or
                          (II) within 1 year after the date of 
                        the enactment of this paragraph,
                whichever is later.
          (B) If an extension is granted with respect to a 
        request filed under this paragraph, the periods of time 
        for retaining records set forth in subsection (t) of 
        this section and section 508(c)(3) shall be extended 
        for an additional 18 months or, in a case to which 
        subparagraph (A)(ii) applies, for a period not to 
        exceed 1 year from the date the claim is filed.
          (C) For purposes of this paragraph, the term `major 
        disaster' has the meaning given that term in section 
        102(2) of the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act (42 U.S.C. 5122(2)).
    (s) Designation of Merchandise by Successor.--
          (1) For purposes of subsection (b), a drawback 
        successor may designate imported merchandise used by 
        the predecessor before the date of succession as the 
        basis for drawback on articles manufactured by the 
        drawback successor after the date of succession.
          (2) for purposes of subsection (j)(2), a drawback 
        successor may designate--
                  (A) imported merchandise which the 
                predecessor, before the date of succession, 
                imported; or
                  (B) imported merchandise, commercially 
                interchangeable merchandise, or any combination 
                of imported and commercially interchangeable 
                merchandise for which the predecessor received, 
                before the date of succession, from the person 
                who imported and paid any duty due on the 
                imported merchandise a certificate of delivery 
                transferring to the predecessor such 
                merchandise;
        as the basis for drawback on merchandise possessed by 
        the drawback predecessor after the date of succession.
          (3) For purposes of this subsection, the term 
        ``drawback successor'' means an entity to which another 
        entity (in this subsection referred to as the 
        ``predecessor'') has transferred by written agreement, 
        merger, or corporate resolution--
                  (A) all or substantially all of the rights, 
                privileges, immunities, powers, duties, and 
                liabilities of the predecessor; or
                  (B) the assets and other business interests 
                of a division, plant, or other business unit of 
                such predecessor, but only if in such transfer 
                the value of the transferred realty, 
                personalty, and intangibles (other than 
                drawback rights, inchoate or otherwise) exceeds 
                the value of all transferred drawback rights, 
                inchoate or otherwise.
          (4) No drawback shall be paid under this subsection 
        until either the predecessor or the drawback successor 
        (who shall also certify that it has the predecessor's 
        records) certifies that--
                  (A) the transferred merchandise was not and 
                will not be claimed by the predecessor, and
                  (B) the predecessor did not and will not 
                issue any certificate to any other person that 
                would enable that person to claim drawback.
    (t) Drawback Certificates.--Any person who issues a 
certificate which would enable another person to claim drawback 
shall be subject to the recordkeeping provisions of this Act, 
with the retention period beginning on the date that such 
certificate is issued.
    (u) Eligibility of Entered or Withdrawn Merchandise.--
Imported merchandise that has not been regularly entered or 
withdrawn for consumption shall not satisfy any requirement for 
use, exportation, or destruction under this section.
    (v) Multiple Drawback Claims.--Merchandise that is exported 
or destroyed to satisfy any claim for drawback shall not be the 
basis of any other claim for drawback; except that appropriate 
credit and deductions for claims covering components or 
ingredients of such merchandise shall be made in computing 
drawback payments.
    (w) Limited Applicability for Certain Agricultural 
Products.--
          (1) In general.--No drawback shall be available with 
        respect to an agricultural product subject to the over-
        quota rate of duty established under a tariff-rate 
        quota, except pursuant to subsection (j)(1).
          (2) Application to tobacco.--Notwithstanding 
        paragraph (1), drawback shall also be available 
        pursuant to subsection (a) with respect to any tobacco 
        subject to the over-quota rate of duty established 
        under a tariff-rate quota.
    (x) Drawback for Recovered Materials.--For purposes of 
subsections (a), (b), and (c), the term ``destruction'' 
includes a process by which materials are recovered from 
imported merchandise or from an article manufactured from 
imported merchandise. In determining the amount of duties to be 
refunded as drawback to a claimant under this subsection, the 
value of recovered materials (including the value of any tax 
benefit or royalty payment) that accrues to the drawback 
claimant shall be deducted from the value of the imported 
merchandise that is destroyed, or from the value of the 
merchandise used, or designated as used, in the manufacture of 
the article.

                        3. Entry of Merchandise


           Section 484 of the Tariff Act of 1930, as amended


[19 U.S.C. 1484; P.L. 71-361, as amended by P.L. 103-182, P.L. 104-295, 
             P.L. 104-153, P.L. 106-200, and P.L. 106-476]

SEC. 484. ENTRY OF MERCHANDISE.

    (a) Requirement and Time.--
          (1) Except as provided in sections 490, 498, 552, and 
        553, one of the parties qualifying as ``importer of 
        record'' under paragraph (2)(B), either in person or by 
        an agent authorized by the party in writing, shall, 
        using reasonable care--
                  (A) make entry therefor by filing with the 
                Customs Service--
                          (i) such documentation or, pursuant 
                        to an electronic data interchange 
                        system, such information as is 
                        necessary to enable the Customs Service 
                        to determine whether the merchandise 
                        may be released from customs custody, 
                        and
                          (ii) notification whether an import 
                        activity summary statement will be 
                        filed; and
                  (B) complete the entry by filing with the 
                Customs Service the declared value, 
                classification and rate of duty applicable to 
                the merchandise, and such other documentation 
                or, pursuant to an electronic data interchange 
                system, such other information as is necessary 
                to enable the Customs Service to--
                          (i) properly assess duties on the 
                        merchandise,
                          (ii) collect accurate statistics with 
                        respect to the merchandise, and
                          (iii) determine whether any other 
                        applicable requirement of law (other 
                        than a requirement relating to release 
                        from customs custody) is met.
          (2)(A) The documentation or information required 
        under paragraph (1) with respect to any imported 
        merchandise shall be filed or transmitted in such 
        manner and within such time periods as the Secretary 
        shall by regulation prescribe. Such regulations shall 
        provide for the filing of import activity summary 
        statements, covering entries or warehouse withdrawals 
        made during a calendar month, within such time period 
        as is prescribed in regulations but not to exceed the 
        20th day following such calendar month.
          (B) When an entry of merchandise is made under this 
        section, the required documentation or information 
        shall be filed or electronically transmitted either by 
        the owner or purchaser of the merchandise or, when 
        appropriately designated by the owner, purchaser, or 
        consignee of the merchandise, a person holding a valid 
        license under section 641. When a consignee declares on 
        entry that he is the owner or purchaser of merchandise 
        the Customs Service may, without liability, accept the 
        declaration. For the purposes of this Act, the importer 
        of record must be one of the parties who is eligible to 
        file the documentation or information required by this 
        section.
          (C) The Secretary, in prescribing regulations to 
        carry out this subsection, shall establish procedures 
        which insure the accuracy and timeliness of import 
        statistics, particularly statistics relevant to the 
        classification and valuation of imports. Corrections of 
        errors in such statistical data shall be transmitted 
        immediately to the Director of the Bureau of the 
        Census, who shall make corrections in the statistics 
        maintained by the Bureau. The Secretary shall also 
        provide, to the maximum extent practicable, for the 
        protection of the revenue, the enforcement of laws 
        governing the importation and exportation of 
        merchandise, the facilitation of the commerce of the 
        United States, and the equal treatment of all importers 
        of record of imported merchandise.
    (b) Reconciliation.--\2\
---------------------------------------------------------------------------
    \2\ Section 18(a) of the Miscellaneous Trade and Technical 
Corrections Act of 1996 (Public Law 104-295) changed the definition of 
``reconciliation'' in section 410(s) of the Tariff Act of 1930 to read 
as follows: ``The term `reconciliation' means an electronic process, 
initiated at the request of an importer, under which the elements of an 
entry (other than those elements related to the admissibility of the 
merchandise) that are undetermined at the time the importer files or 
transmits the documentation or information required by section 
484(a)(1)(B), or the import activity summary statement, are provided to 
the Customs Service at a later time.''
---------------------------------------------------------------------------
          (1) In general.--A party may elect to file a 
        reconciliation with regard to such entry elements as 
        are identified by the party pursuant to regulations 
        prescribed by the Secretary. If the party so elects, 
        the party shall declare that a reconciliation will be 
        filed. The declaration shall be made in such manner as 
        the Secretary shall prescribe and at the time the 
        documentation or information required by subsection 
        (a)(1)(B) or the import activity summary statement is 
        filed with, or transmitted to, the Customs Service, or 
        at such later time as the Customs Service may, in its 
        discretion, permit. The reconciliation shall be filed 
        by the importer of record at such time and in such 
        manner as the Secretary prescribes but not later than 
        15 months after the date the importer declares his 
        intent to file the reconciliation. In the case of 
        reconciling issues relating to the assessment of 
        antidumping and countervailing duties, the 
        reconciliation shall be filed not later than 90 days 
        after the date the Customs Service advises the importer 
        that the period of review for antidumping or 
        countervailing duty purposes has been completed. Before 
        filing a reconciliation, an importer of record shall 
        post bond or other security pursuant to such 
        regulations as the Secretary may prescribe.
          (2) Regulations regarding ad/cv duties.--The 
        Secretary shall prescribe, in consultation with the 
        Secretary of Commerce, such regulations as are 
        necessary to adapt the reconciliation process for use 
        in the collection of antidumping and countervailing 
        duties.
    (c) Release of Merchandise.--The Customs Service may permit 
the entry and release of merchandise from customs custody in 
accordance with such regulations as the Secretary may 
prescribe. No officer of the Customs Service shall be liable to 
any person with respect to the delivery of merchandise released 
from customs custody in accordance with such regulations.
    (d) Signing and Contents.--(1) Entries shall be signed by 
the importer of record, or his agent, unless filed pursuant to 
an electronic data interchange system. If electronically filed, 
each transmission of data shall be certified by an importer of 
record or his agent, one of whom shall be resident in the 
United States for purposes of receiving service of process, as 
being true and correct to the best of his knowledge and belief, 
and such transmission shall be binding in the same manner and 
to the same extent as a signed document. The entry shall set 
forth such facts in regard to the importation as the Secretary 
may require and shall be accompanied by such invoices, bills of 
lading, certificates, and documents, or their electronically 
submitted equivalents, as are required by regulation.
    (2) The Secretary, in prescribing regulations governing the 
content of entry documentation, shall require that entry 
documentation contain such information as may be necessary to 
determine whether the imported merchandise bears an infringing 
trademark in violation of section 42 of the Act of July 5, 1946 
(commonly referred to as the ``Trademark Act of 1946''; 15 
U.S.C. 1124), or any other applicable law, including a 
trademark appearing on the goods or packaging.
    (e) Production of Invoice.--The Secretary may provide by 
regulation for the production of an invoice, parts thereof, or 
the electronic equivalents thereof, in such manner and form, 
and under such terms and conditions, as the Secretary considers 
necessary.
    (f) Statistical Enumeration.--The Secretary, the Secretary 
of Commerce, and the United States International Trade 
Commission shall establish from time to time for statistical 
purposes an enumeration of articles in such detail as in their 
judgment may be necessary, comprehending all merchandise 
imported into the United States and exported from the United 
States, and shall seek, in conjunction with statistical 
programs for domestic production and programs for achieving 
international harmonization of trade statistics, to establish 
the comparability thereof with such enumeration of articles. 
All import entries and export declarations shall include or 
have attached thereto an accurate statement specifying, in 
terms of such detailed enumeration, the kinds and quantities of 
all merchandise imported and exported and the value of the 
total quantity of each kind of article.
    (g) Statement of Cost of Production.--Under such 
regulations as the Secretary may prescribe, the Customs Service 
may require a verified statement from the manufacturer or 
producer showing the cost of producing the imported 
merchandise, if the Customs Service considers such verification 
necessary for the appraisement of such merchandise.
    (h) Admissibility of Data Electronically Transmitted.--Any 
entry or other information transmitted by means of an 
authorized electronic data interchange system shall be 
admissible in any and all administrative and judicial 
proceedings as evidence of such entry or information.
    (i) Special Rule For Foreign Trade Zone Operations.--
          (1) In general.--Notwithstanding any other provision 
        of law and except as provided in paragraph (3), all 
        merchandise (including merchandise of different 
        classes, types, and categories), withdrawn from a 
        foreign trade zone during any 7-day period, shall, at 
        the option of the operator or user of the zone, be the 
        subject of a single of a single estimated entry or 
        release filed on or before the first day of the 7-day 
        period in which the merchandise is to be withdrawn from 
        the zone. The estimated entry or release shall be 
        treated as a single entry and a single release of 
        merchandise for purposes of section 13031(a)(9)(A) of 
        the Consolidated Omnibus Budget Reconciliation Act of 
        1985 (19 U.S.C. 58c(a)(9)(A)) and all fee exclusions 
        and limitations of such section 13031 shall apply, 
        including the maximum and minimum fee amounts provided 
        for under subsection (b)(8)(A)(i) of such section. The 
        entry summary for the estimated entry or release shall 
        cover only the merchandise actually withdrawn from the 
        foreign trade zone during the 7-day period.
          (2) Other requirements.--The secretary of the 
        Treasury may require that the operator or user of the 
        zone--
                (A) use an electronic data interchange approved 
                by the Customs Service--
                        (i) to file the entries described in 
                        paragraph (1); and
                        (ii) to pay the applicable duties, 
                        fees, and taxes with respect to the 
                        entries; and
                (B) satisfy the Customs Service that 
                accounting, transportation, and other controls 
                over the merchandise are adequate to protect 
                the revenue and meet the requirements of other 
                Federal agencies.
        (3) Exception.--The provisions of paragraph (1) shall 
        not apply to merchandise the entry of which is 
        prohibited by law or merchandise for which the filing 
        of an entry summary is required before the merchandise 
        is released from customs custody.
        (4) Foreign trade zone; zone.--In this subsection, the 
        terms `foreign trade zone' and `zone' mean a zone 
        established purusant to the Act of June 18, 1934, 
        commonly known as the Foreign Trade Zones Act (19 
        U.S.C. 81a et seq.).
    (j) Treatment of Multiple Entries of merchandise as Single 
Transaction.--In the case of merchandise that is purchased and 
invoiced as a single entity but--
        (1) is shipped in an unassembled or disassembled 
        condition in separate shipments due to the size or 
        nature of the merchandise, or
        (2) is shipped in separate shipments due to the 
        inability of the carrier to include all of the 
        merchandise in a single shipment (at the instruction of 
        the carrier), the Customs Service may, upon application 
        by an importer in advance, treat such separate 
        shipments for entry purposes as a single 
        transaction.''.
    (k) Regulations.--Not later than 6 months after the date of 
the enactment of this Act, the Secretary of the Treasury shall 
issue regulations to carry out section 484(j) of the Tariff Act 
of 1930, as added by subsection (a).

                      REPORT ON CUSTOMS PROCEDURES


                     [P.L. 106-476 (section 1461)]

SEC. 1461. REPORT ON CUSTOMS PROCEDURES

    (a) Review and Report.--The Secretary of the Treasury 
shall--
        (1) review, in consultation with United States 
        importers and other interested parties, including 
        independent third parties selected by the Secretary for 
        the purpose of conducting such review, customs 
        procedures and related laws and regulations applicable 
        to goods and commercial conveyances entering the United 
        States; and
        (2) report to the Congress, not later than 180 days 
        after the date of the enactment of this Act, on changes 
        that should be made to reduce reporting and record 
        retention requirements for commercial parties, 
        specifically addressing changes needed to--
                (A) separate fully and remove the linkage 
                between data reporting required to determine 
                the adminissibility and release of goods and 
                data reporting for other purposes such as 
                collection of revenue and statistics;
                (B) reduce to a minimum data required for 
                determining the admissibility of goods and 
                release of goods, consistent with the 
                protection of public health, safety, or 
                welfare, or achievement of other policy goals 
                of the United States;
                (C) eliminate or find more efficient means of 
                collecting data for other purposes that are 
                unnecessary, overly burdensome, or redundant; 
                and
                (D) enable the implementation, as soon as 
                possible, of the import activity summary 
                statement authorized by section 411 of the 
                Tariff Act of 1930 (19 U.S.C. 1411) as a means 
                of--
                        (i) fully separating and removing the 
                        linkage between the functions of 
                        collecting revenue and statistics and 
                        the function of determining the 
                        admissibility of goods that must be 
                        performed for each shipment of goods 
                        entering the United States; and
                        (ii) allowing for periodic, 
                        consolidated filing of data not 
                        required for determinations of 
                        adminissibility.
    (b) Specific Matters.--In preparing the report required by 
subsection (a), the Secretary of the Treasury shall 
specifically report on the following:
          (1) Import procedures, including specific data items 
        collected, that are required prior and subsequent to 
        the release of goods or conveyances, identifying the 
        rationale and legal basis for each procedure and data 
        requirement, uses of data collected, and procedures or 
        data requirements that could be eliminated, or deferred 
        and consolidated into periodic reports such as the 
        import activity summary statement.
          (2) The identity of data and factors necessary to 
        determine whether physical inspections should be 
        conducted.
          (3) The cost of data collection.
          (4) Potential alternative sources and methodologies 
        for collecting data, taking into account the costs and 
        other consequences to importers, exporters, carriers, 
        and the Government of choosing alternative sources.
          (5) Recommended changes to the law, regulations of 
        any agency, or other measures that would improve the 
        efficiency of procedures and systems of the United 
        States Government for regulating international trade, 
        without compromising the effectiveness of procedures 
        and systems required by law.

             4. Protests and Further Administrative Reviews


          Sec. 514-516 of the Tariff Act of 1930, as amended.


 [19 U.S.C. 1514-1516; P.L. 71-361, as amended by P.L. 91-271, P.L. 96-
39, P.L. 96-417, P.L. 98-573, P.L. 99-514, P.L. 100-418, P.L. 100-449, 
              P.L. 103-182, P.L. 104-295 and P.L. 106-36]

SEC. 514. PORTEST AGAINST DECISIONS OF THE CUSTOMS SERVICE

    (a) Finality of decisions; return of papers.--Except as 
provided in subsection (b) of this section, section 501 [19 
USCS Sec. 1501] (relating to voluntary reliquidations), section 
516 [19 USCS Sec. 1516] (relating to petitions by domestic 
interested parties[.]), and section 520 [19 USCS Sec. 1520] 
(relating to refunds and errors) of this Act, decisions of the 
Customs Service, including the legality of all orders and 
findings entering into the same, as to--
          (1) the appraised value of merchandise;
          (2) the classification and rate and amount of duties 
        chargeable;
          (3) all charges or exactions of whatever character 
        within the jurisdiction of the Secretary of the 
        Treasury;
          (4) the exclusion of merchandise from entry or 
        delivery or a demand for redelivery to customs custody 
        under any provision of the customs laws, except a 
        determination appealable under section 337 of this Act 
        [19 USCS Sec. 1337];
          (5) the liquidation or reliquidation of an entry, or 
        reconciliation as to the issues contained therein, or 
        any modification thereof;
          (6) the refusal to pay a claim for drawback; or
          (7) the refusal to reliquidate an entry under 
        subsection (c) or (d) of section 520 of this Act [19 
        USCS Sec. 1520];
    shall be final and conclusive upon all persons (including 
the United Sta4s and any officer thereof) unless a protest is 
filed in accordance with this section, or unless a civil action 
contesting the denial of a protest, in whole or in part, is 
commenced in the United States Court of International Trade in 
accordance with chapter 169 of title 28 of the United States 
Code [28 USCS Sec. Sec. 2631 et seq.] within the time 
prescribed by section 2636 [28 USCS Sec. 2636]. When a judgment 
or order of the United States Court of International Trade has 
become final, the papers transmitted shall be returned, 
together with a copy of the judgment or order to the Customs 
Service, which shall take action accordingly.
    (b) Finality and conclusiveness of customs officers' 
determinations.--With respect to determinations made under 
section 303 of this Act [19 USCS Sec. 1303] or title VII of 
this Act [19 USCS Sec. Sec. 1671 et seq.] Which are reviewable 
under section 516A of this title [19 USCS Sec. 1516a], 
determinations of the Customs Service are final and conclusive 
upon all persons (including the United States and any officer 
thereof) unless a civil action contesting a determination 
listed in section 516A of this title [19 USCS Sec. 1516a] is 
commenced in the United States Court of International Trade, or 
review by a binational panel of a determination to which 
section 516A(g)(2) [19 USCS Sec. 1516a (g)(2)] applies is 
commenced pursuant to section 516A(g) [19 USCS Sec. 1516a(g)] 
and article 1904 of The North American Free Trade Agreement or 
the United States-Canada Free-Trade Agreement.
    (c) Form, number, and amendment of protest; filing of 
protest.--
          (1) A protest of a decision made under subsection (a) 
        shall be filed in writing, or transmitted 
        electronically pursuant to an electronic data 
        interchange system, in accordance with regulations 
        prescribed by the Secretary. A protest must set forth 
        distinctly and specifically--
                  (A) each decision described in subsection (a) 
                as to which protest is made;
                  (B) each category of merchandise affected by 
                each decision set forth under paragraph (1);
                  (C) the nature of each objection and the 
                reasons therefor; and
                  (D) any other matter required by the 
                Secretary by regulation.
        Only one protest may be filed for each entry of 
        merchandise, except that where the entry covers 
        merchandise of different categories, a separate protest 
        may be filed for each category. In addition, separate 
        protests filed by different authorized persons with 
        respect to any one category of merchandise, or with 
        respect to a determination of origin under section 202 
        of the North American Free Trade Agreement 
        Implementation Act [19 USCS Sec. 3332], that is the 
        subject of a protest are deemed to be part of a single 
        protest. A protest may be amended, under regulations 
        prescribed by the Secretary, to set forth objections as 
        to a decision or decisions described in subsection (a) 
        which were not the subject of the original protest, in 
        the form and manner prescribed for a protest, any time 
        prior to the expiration of the time in which such 
        protest could have been filed under this section. New 
        grounds in support of objections raised by a valid 
        protest or amendment thereto may be presented for 
        consideration in connection with the review of such 
        protest pursuant to section 515 of this Act [19 USCS 
        Sec. 1515] at any time prior to the disposition of the 
        protest in accordance with that section.
          (2) Except as provided in sections 485(d) and 557(b) 
        of this Act [19 USCS Sec. Sec. 1485(d) and 1557(b)], 
        protests may be filed with respect to merchandise which 
        is the subject of a decision specified in subsection 
        (a) of this section by--
                  (A) the importers or consignees shown on the 
                entry papers, or their sureties;
                  (B) any person paying any charge or exaction;
                  (C) any person seeking entry or delivery;
                  (D) any person filing a claim for drawback;
                  (E) with respect to a determination of origin 
                under section 202 of the North American Free 
                Trade Agreement Implementation Act [19 USCS 
                Sec. 3332], any exporter or producer completed 
                and signed a NAFTA Certificate of Origin 
                covering the merchandise; or
                  (F) any authorized agent of any of the 
                persons described in clauses (A) through (E).
          (3) A protest of a decision, order, or finding 
        described in subsection (a) shall be filed with the 
        Customs Service within ninety days after but not 
        before--
                  (A) notice of liquidation or reliquidation, 
                or
                  (B) in circumstances where subparagraph (A) 
                is inapplicable, the date of the decision as to 
                which protest is made.
        A protest by a surety which has an unsatisfied legal 
        claim under its bond may be filed within 90 days from 
        the date of mailing of notice of demand for payment 
        against its bond. If another party has not filed a 
        timely protest, the surety's protest shall certify that 
        it is not being filed collusively to extend another 
        authorized person's time to protest as specified in 
        this subsection.
    (d) Limitation on protest of reliquidation. The 
reliquidation of an entry shall not open such entry so that a 
protest may be filed against the decision of the Customs 
Service upon any question not involved in such reliquidation.
    (e) Advance notice of certain determination. Except as 
provided in subsection (f), an exporter or producer referred to 
in subsection (c)(2)(E) shall be provided notice in advance of 
an adverse determination of origin under section 202 of the 
North American Free Trade Agreement Implementation Act (19 USCS 
Sec. 3332]. The Secretary may, by regulations, prescribe the 
time period in which such advance notice shall be issued and 
authorize the Customs Service to provide in the notice the 
entry number and any other entry information considered 
necessary to allow the exporter or producer to exercise the 
rights provided by this section.
    (f) Denial of preferential treatment. If the Customs 
Service finds indications of a pattern of conduct by an 
exporter or producer of false or unsupported representations 
that goods qualify under the rules of origin set out in section 
202 of the North American Free Trade Agreement Implementation 
Act [19 USCS Sec. 3332]--
          (1) the Customs Service, in accordance with 
        regulations issued by the Secretary, may deny 
        preferential tariff treatment to entries of identical 
        goods exported or produced by that person; and
          (2) the advance notice requirement in subsection (e) 
        shall not apply to that person; until the person 
        establishes to the satisfaction of the Customs Service 
        that its representations are in conformity with section 
        202 [19 USCS Sec. 3332].

SEC. 515. REVIEW OF PROTESTS

    (a) Administrative Review and Modification of Decisions.--
Unless a request for an accelerated disposition of a protest is 
filed in accordance with subsection (b) of this section the 
appropriate customs officer, within two years from the date a 
protest was filed in accordance with section 514 of this Act 
[19 USCS Sec. 1514], shall review the protest and shall allow 
or deny such protest in whole or in part. Thereafter, any 
duties, charge, or exaction found to have been assessed or 
collected in excess shall be remitted or refunded and any 
drawback found due shall be paid. Upon the request of the 
protesting party, filed within the time allowed for the filing 
of a protest under section 514 of this Act [19 USCS Sec. 1514], 
a protest may be subject to further review by another 
appropriate customs officer, under the circumstances and in the 
form and manner that may be prescribed by the Secretary in 
regulations, but subject to the two-year limitation prescribed 
in the first sentence of this subsection. Within 30 days from 
the date an application for further review is filed, the 
appropriate customs officer shall allow or deny the application 
and, if allowed, the protest shall be forwarded to the customs 
officer who will be conducting the further review. Notice of 
the denial of any protest shall be mailed in the form and 
manner prescribed by the Secretary. Such notice shall included 
a statement of the reasons for the denial, as well as a 
statement informing the protesting party of his right to file a 
civil action contesting the denial of a protest under section 
514 of the Tariff Act of 1930 [19 USCS Sec. 1514].
    (b) Request for Accelerated Disposition of Protest. A 
request for accelerated disposition of a protest filed in 
accordance with section 514 of this Act [19 USCS Sec. 1514] may 
be mailed by certified or registered mail to the appropriate 
customs officer any time after ninety days following the filing 
of such protest. For purposes of section 1581 of title 28 of 
the United States Code [28 USCS Sec. 1581], a protest which has 
not been allowed or denied in whole or in part within thirty 
days following the date of mailing by certified or registered 
mail of a request for accelerated disposition shall be deemed 
denied on the thirtieth day following mailing of such request.
    (c) Request for Set Aside of Denial of Further Review. If a 
protesting party believes that an application for further 
review was erroneously or improperly denied or was denied 
without authority for such action, it may file with the 
Commissioner of Customs a written request that the denial of 
the application for further review be set aside. Such request 
must be filed within 60 days after the date of the notice of 
the denial. The Commissioner of Customs may review such request 
and, based solely on the information before the Customs Service 
at the time the application for further review was denied, may 
set aside the denial of the application for further review and 
void the denial of protest, if appropriate. If the Commissioner 
of Customs fails to act within 60 days after the date of the 
request, the request shall be considered denied. All denials of 
protests are effective from the date of original denial for 
purposes of section 2536 of title 28, United States Code. If an 
action is commenced in the Court of International Trade that 
arises out of a protest or an application for further review, 
all administrative action pertaining to such protest or 
application shall terminate and any administrative action taken 
subsequent to the commencement of the action is null and void.
    (d) Voiding Denial of Protest.--If a protest is timely and 
properly filed, but is denied contrary to proper instructions, 
the Customs Service may on its own initiative, or pursuant to a 
written request by the protesting party filed with the 
appropriate port director within 90 days after the date of the 
protest denial, void the denial of the protest.

SEC. 516. PETITIONS BY THE DOMESTIC INTERESTED PARTIES

    (a) Request for Classification and Rate of Duty; Petition.
          (1) The Secretary shall, upon written request by an 
        interested party furnish the classification and the 
        rate of duty imposed upon designated imported 
        merchandise of a class or kind manufactured, produced, 
        or sold at wholesale by such interested party. If the 
        interested party believes that the appraised value, the 
        classification, or rate of duty is not correct, it may 
        file a petition with the Secretary setting forth--
                  (A) a description of the merchandise,
                  (B) the appraised value, the classification, 
                or the rate of duty that it believes proper, 
                and
                  (C) the reasons for its belief.
          (2) As used in this section, the term ``interested 
        party'' means a person who--
                  (A) a manufacturer, producer, or wholesaler 
                in the United States;
                  (B) a certified union or recognized union or 
                group of workers which is representative of an 
                industry engaged in the manufacture, 
                production, or wholesale in the United States; 
                or
                  (C) a trade or business association a 
                majority of whose members are manufacturers, 
                producers, or wholesalers in the United States, 
                of goods of the same class or kind as the 
                designated imported merchandise.
    Such term includes as association, a majority of who 
members is composed of persons described in subparagraph (A), 
(B), or (C).
          (3) Any producer of a raw agricultural product who is 
        considered under section 771(4)(E) [19 USCS 
        Sec. 1677(4)(E)] to be part of the industry producing a 
        processed agricultural product of the same class or 
        kind as the designated imported merchandise shall, for 
        purposes of this section, be treated as an interested 
        party producing such processed agricultural product.
    (b) Determiniation on Petition.--If, after receipt and 
consideration of a petition filed by such an interested party, 
the Secretary determines that the appraised value, the 
classification, or rate of duty is not correct, he shall 
determine the proper appraised value, classification, or rate 
of duty and shall notify the petitioner of this determination. 
All such merchandise entered for consumption or withdrawn from 
warehouse for consumption more than thirty days after the date 
such notice to the petitioner is published in the weekly 
Customs Bulletin shall be appraised, classified, or assessed as 
to the rate of duty in accordance with the Secretary's 
determination.
    (c) Contest by Petitioner of Appraised Value, 
Classification, or Rate of Duty.--If the Secretary determines 
that the appraised value, classification, or rate of duty with 
respect to which a petition was filed pursuant to subsection 
(a) of this section is correct, he shall notify the petitioner. 
If dissatisfied with the determination of the Secretary, the 
petitioner may file with the Secretary, not later than thirty 
days after the date of the notification, notice that it desires 
to contest the appraised value, classification, or rate of 
duty. Upon receipt of notice from the petitioner, the Secretary 
shall cause publication to be made of his determination as to 
the proper appraised value, classification, or rate of duty and 
of the petitioner's desire to contest, and shall thereafter 
furnish the petitioner with such information as to the entries 
and consignees of such merchandise, entered after the 
publication of the determination of the Secretary, at such 
ports of entry designated by the petitioner in his notice of 
desire to contest, as will enable the petitioner to contest the 
appraised value, classification, or rate of duty imposed upon 
such merchandise in the liquidation of one such entry at such 
port. The Secretary shall direct the appropriate customs 
officer at such ports to immediately notify the petitioner by 
mail when the first of such entries is liquidated.
    (d) Appraisal, Classification, and Liquidation of Entries 
of Merchandise Covered by Published Decisions of the 
Secretary.--Notwithstanding the filing of an action pursuant to 
chapter 169 of title 28 of the United States Code [28 USCS 
Sec. Sec. 2631 et seq.], merchandise of the character covered 
by the published decision of the Secretary (when entered for 
consumption or withdrawn from warehouse for consumption on or 
before the date of publication of a decision of the United 
States Court of International Trade or of the United States 
Court of Appeals for the Federal Circuit, not in harmony with 
the published decision of the Secretary) shall be appraised or 
classified, or both, and the entries liquidated, in accordance 
with the decision of the Secretary and, except as otherwise 
provided in this chapter, the final liquidations of these 
entries shall be conclusive upon all parties.
    (e) Consignee or His Agent as Party in Interest Before the 
Court of International Trade.--The consignee or his agent shall 
have the right to appear and to be heard as a party in interest 
before the United States Court of International Trade.
    (f) Appraisement, Classification, and Assessment of Duty of 
Merchandise Covered by Published Decision of the Secretary in 
Accordance With Final Judicial Decision of Court of 
International Trade or Court of Appeals for the Federal Circuit 
Sustaining Cause of Action in Whole or in Part; Suspension of 
Liquidation of Entries; Publication.--If the cause of action is 
sustained in whole or in part by a decision of the United 
States Court of International Trade or of the United States 
Court of Appeals for the Federal Circuit, merchandise of the 
character covered by the published decision of the Secretary, 
which is entered for consumption or withdrawn from warehouse 
for consumption after the date of publication in the Federal 
Register by the Secretary or the administering authority of a 
notice of the court decision, shall be subject to appraisement, 
classification, and assessment of duty in accordance with the 
final judicial decision in the action, and the liquidation of 
entries covering the merchandise so entered or withdrawn shall 
be suspended until final disposition is made of the action, 
whereupon the entries shall be liquidated, or if necessary, 
reliquidated in accordance with the final decision. Such notice 
of the court decision shall be published within ten days from 
the date of the issuance of the court decision.
    (g) Regulations Implementing Required Procedures.--
Regulations shall be prescribed by the Secretary to implement 
the procedures required under this Section.

                5. Copyrights and Trademark Enforcement


           Section 101 of the Copyright Revision Act of 1976


                      [17 U.S.C. 602; P.L. 94-553]

SEC. 602. INFRINGING IMPORTATION OF COPIES OR PHONORECORDS.

    (a) Importation into the United States, without the 
authority of the owner of copyright under this title, of copies 
or phonorecords of a work that have been acquired outside the 
United States is an infringement of the exclusive right to 
distribute copies or phonorecords under section 106, actionable 
under section 501. This subsection does not apply to--
          (1) importation of copies or phonorecords under the 
        authority or for the use of the Government of the 
        United States or of any State or political subdivision 
        of a State, but not including copies or phonorecords 
        for use in schools, or copies of any audiovisual work 
        imported for purposes other than archival use;
          (2) importation, for the private use of the importer 
        and not for distribution, by any person with respect to 
        no more than one copy or phonorecord of any one work at 
        any one time, or by any person arriving from outside 
        the United States with respect to copies or 
        phonorecords forming part of such person's personal 
        baggage; or
          (3) importation by or for any organization operated 
        for scholarly, educational, or religious purposes and 
        not for private gain, with respect to no more than one 
        copy of any audiovisual work solely for its archival 
        purposes, and no more than five copies or phonorecords 
        of any other work for its library lending or archival 
        purposes, unless the importation of such copies or 
        phonorecords is part of an activity consisting of 
        systematic reproduction or distribution, engaged in by 
        such organization in violation of the provisions of 
        section 108(g)(2).
    (b) In a case where the making of the copies or 
phonorecords would have constituted an infringement of 
copyright if this title had been applicable, their importation 
is prohibited. In a case where the copies of phonorecords were 
lawfully made, the United States Customs Service has no 
authority to prevent their importation unless the provisions of 
section 601 are applicable. In either case, the Secretary of 
the Treasury is authorized to prescribe, by regulation, a 
procedure under which any person claiming an interest in the 
copyright in a particular work may, upon payment of a specified 
fee, be entitled to notification by the Customs Service of the 
importation of articles that appear to be copies or 
phonorecords of the work.

           Section 526 of the Tariff Act of 1930, as amended


 [19 U.S.C. 1526; P.L. 71-361, as amended by P.L. 93-596, P.L. 95-410, 
                    P.L. 103-182, and P.L. 104-153]

SEC. 526. MERCHANDISE BEARING AMERICAN TRADEMARK.

    (a) Importation Prohibited.--Except as provided in 
subsection (d) of this section, it shall be unlawful to import 
into the United States any merchandise of foreign manufacture 
if such merchandise, or the label, sign, print, package, 
wrapper, or receptacle, bears a trademark owned by a citizen 
of, or by a corporation or association created or organized 
within, the United States, and registered in the Patent and 
Trademark Office by a person domiciled in the United States, 
under the provisions of the Act entitled ``An Act to authorize 
the registration of trade-marks used in commerce with foreign 
nations or among the several States or with Indian tribes, and 
to protect the same,'' approved February 20, 1905, as amended 
[sections 81 to 109 of title 15], and if a copy of the 
certificate of registration of such trademark is filed with the 
Secretary of the Treasury, in the manner provided in section 27 
of such Act [15 U.S.C. 106], unless written consent of the 
owner of such trademark is produced at the time of making 
entry.
    (b) Seizure and Forfeiture.--Any such merchandise imported 
into the United States in violation of the provisions of this 
section shall be subject to seizure and forfeiture for 
violation of the customs laws.
    (c) Injunction and Damages.--Any person dealing in any such 
merchandise may be enjoined from dealing therein within the 
United States or may be required to export or destroy such 
merchandise or to remove or obliterate such trade-mark and 
shall be liable for the same damages and profits provided for 
wrongful use of a trade-mark, under the provisions of such Act 
of February 20, 1905, as amended [sections 81 to 109 of title 
15].
    (d) Exemptions; Publications in Federal Register; 
Forfeiture; Rules and Regulations.--
          (1) The trademark provisions of this section and 
        section 42 of the Act of July 5, 1946 (60 Stat. 440; 15 
        U.S.C. 1124), do not apply to the importation of 
        articles accompanying any person arriving in the United 
        States when such articles are for his personal use and 
        not for sale if (A) such articles are within the limits 
        of types and quantities determined by the Secretary 
        pursuant to paragraph (2) of this subsection, and (B) 
        such person has not been granted an exemption under 
        this subsection within thirty days immediately 
        preceding his arrival.
          (2) The Secretary shall determine and publish in the 
        Federal Register lists of the types of articles and the 
        quantities of each which shall be entitled to the 
        exemption provided by this subsection. In determining 
        such quantities of particular types of trade-marked 
        articles, the Secretary shall give such consideration 
        as he deems necessary to the numbers of such articles 
        usually purchased at retail for personal use.
          (3) If any article which has been exempted from the 
        restrictions on importation of the trade-mark laws 
        under this subsection is sold within one year after the 
        date of importation, such article, or its value (to be 
        recovered from the importer), is subject to forfeiture. 
        A sale pursuant to a judicial order or in liquidation 
        of the estate of a decedent is not subject to the 
        provisions of this paragraph.
          (4) The Secretary may prescribe such rules and 
        regulations as may be necessary to carry out the 
        provisions of this subsection.
    (e) Merchandise Bearing Counterfeit Mark; Seizure and 
Forfeiture; Disposition of Seized Goods.--Any such merchandise 
bearing a counterfeit mark (within the meaning of section 45 of 
the Act of July 5, 1946 (commonly referred to as the Lanham 
Act, 60 Stat. 427; 15 U.S.C. 1127)) imported into the United 
States in violation of the provisions of section 42 of the Act 
of July 5, 1946 (60 Stat. 440; 15 U.S.C. 1124), shall be seized 
and, in the absence of the written consent of the trademark 
owner, forfeited for violations of the customs laws. Upon 
seizure of such merchandise, the Secretary shall notify the 
owner of the trademark, and shall, after forfeiture, destroy 
the merchandise. Alternatively, if the merchandise is not 
unsafe or a hazard to health, and the Secretary has the consent 
of the trademark owner, the Secretary may obliterate the 
trademark where feasible and dispose of the goods seized--
          (1) by delivery to such Federal, State, and local 
        government agencies as in the opinion of the Secretary 
        have a need for such merchandise,
          (2) by gift to such eleemosynary institutions as in 
        the opinion of the Secretary have a need for such 
        merchandise,
          (3) more than 90 days after the date of forfeiture, 
        by sale by the Customs Service at public auction under 
        such regulations as the Secretary prescribes, except 
        that before making any such sale the Secretary shall 
        determine that no Federal, State, or local government 
        agency or eleemosynary institution has established a 
        need for such merchandise under paragraph (1) or (2).
          (4) [Deleted]
  (f) Civil Penalties.--(1) Any person who directs, assists 
financially or otherwise, or aids and abets the importation of 
merchandise for sale or public distribution that is seized 
under subsection (e) shall be subject to a civil fine.
          (2) For the first such seizure, the fine shall be not 
        more than the value that the merchandise would have had 
        if it were genuine, according to the manufacturer's 
        suggested retail price, determined under regulations 
        promulgated by the Secretary.
          (3) For the second seizure and thereafter, the fine 
        shall be not more than twice the value that the 
        merchandise would have had if it were genuine, as 
        determined under regulations promulgated by the 
        Secretary.
          (4) The imposition of a fine under this subsection 
        shall be within the discretion of the Customs Service, 
        and shall be in addition to any other civil or criminal 
        penalty or other remedy authorized by law.

           Section 431 of the Tariff Act of 1930, as amended


[19 U.S.C. 1431; P.L. 71-361, as amended by P.L. 98-573, P.L. 100-690, 
             P.L. 103-182, P.L. 104-153, and P.L. 104-295]

SEC. 431. MANIFEST--REQUIREMENT, FORM, AND CONTENTS.

  (a) In General.--Every vessel required to make entry under 
section 434 or obtain clearance under section 4197 of the 
Revised Statutes of the United States (46 U.S.C. App. 91) shall 
have a manifest that complies with the requirements prescribed 
under subsection (d).
  (b) Production of Manifest.--Any manifest required by the 
Customs Service shall be signed, produced, delivered or 
electronically transmitted by the master or person in charge of 
the vessel, aircraft, or vehicle, or by any other authorized 
agent of the owner or operator of the vessel, aircraft, or 
vehicle in accordance with the requirements prescribed under 
subsection (d). A manifest may be supplemented by bill of 
lading data supplied by the issuer of such bill. If any 
irregularity of omission or commission occurs in any way in 
respect to any manifest or bill of lading data, the owner or 
operator of the vessel, aircraft or vehicle, or any party 
responsible for such irregularity, shall be liable for any fine 
or penalty prescribed by law with respect to such irregularity. 
The Customs Service may take appropriate action against any of 
the parties.
  (c)(1) Except as provided in subparagraph (2), the following 
information, when contained in a vessel manifest or aircraft 
manifest, shall be available to public disclosure:
          (A) The name and address of each importer or 
        consignee and the name and address of the shipper to 
        such importer or consignee, unless the importer or 
        consignee has made a biennial certification, in 
        accordance with procedures adopted by the Secretary of 
        the Treasury, claiming confidential treatment of such 
        information.
          (B) The general character of the cargo.
          (C) The number of packages and gross weight.
          (D) The name of the vessel, aircraft, or carrier.
          (E) The seaport or airport of loading.
          (F) The seaport or airport of discharge.
          (G) The country of origin of the shipment.
          (H) The trademarks appearing on the goods or 
        packages.
  (2) The information listed in paragraph (1) shall not be 
available for public disclosure if--
          (A) the Secretary of the Treasury makes an 
        affirmative finding on a shipment-by-shipment basis 
        that disclosure is likely to pose a threat of personal 
        injury or property damage; or
          (B) the information is exempt under the provisions of 
        section 552(b)(1) of title 5 of the United States Code.
  (3) The Secretary of the Treasury, in order to allow for the 
timely dissemination and publication of the information listed 
in paragraph (1), shall establish procedures to provide access 
to manifests. Such procedures shall include provisions for 
adequate protection against the public disclosure of 
information not available for public disclosure from such 
manifests.
  (d) Regulations.--
          (1) In general.--The Secretary shall by regulation--
                  (A) specify the form for, and the information 
                and data that must be contained in, the 
                manifest required by subsection (a);
                  (B) allow, at the option of the individual 
                producing the manifest and subject to paragraph 
                (2), letters and documents shipments to be 
                accounted for by summary manifesting 
                procedures;
                  (C) prescribe the manner of production for, 
                and the delivery or electronic transmittal of 
                the manifest required by subsection (a); and
                  (D) prescribe the manner for supplementing 
                manifests with bill of lading data under 
                subsection (b).
          (2) Letters and documents shipments.--For purposes of 
        paragraph (1)(B)--
                  (A) the Customs Service may require with 
                respect to letters and documents shipments--
                          (i) that they be segregated by 
                        country of origin, and
                          (ii) additional examination 
                        procedures that are not necessary for 
                        individually manifested shipments;
                  (B) standard letter envelopes and standard 
                document packs shall be segregated from larger 
                document shipments for purposes of customs 
                inspections; and
                  (C) the term ``letters and documents'' 
                means--
                          (i) data described in General 
                        Headnote 4(c) of the Harmonized Tariff 
                        Schedule of the United States,
                          (ii) securities and similar evidences 
                        of value described in heading 4907 of 
                        such Schedule, but not monetary 
                        instruments defined pursuant to chapter 
                        53 of title 31, United States Code, and
                          (iii) personal correspondence, 
                        whether on paper, cards, photographs, 
                        tapes, or other media.

          6. Penalties, Prohibitions, and Import Restrictions

    (A) Penalties Prohibitions and Import Restrictions

      Sections 592 and 592A of the Tariff Act of 1930, as amended


 [19 U.S.C. 1592 and 1592A; P.L. 71-361, as amended by Act of Aug. 5, 
 1935, P.L. 95-410, P.L. 96-417, P.L. 103-182, P.L. 103-465, and P.L. 
                                104-295]

SEC. 592. PENALTIES FOR FRAUD, GROSS NEGLIGENCE, AND NEGLIGENCE.

    (a) Prohibition.--
          (1) General rule.--Without regard to whether the 
        United States is or may be deprived of all or a portion 
        of any lawful duty, tax, or fee thereby, no person, by 
        fraud, gross negligence, or negligence--
                  (A) may enter, introduce, or attempt to enter 
                or introduce any merchandise into the commerce 
                of the United States by means of--
                          (i) any document or electronically 
                        transmitted data or information, 
                        written or oral statement, or act which 
                        is material and false,
                          (ii) any omission which is material, 
                        or
                  (B) may aid or abet any other person to 
                violate subparagraph (A).
          (2) Exception.--Clerical errors or mistakes of fact 
        are not violations of paragraph (1) unless they are 
        part of a pattern of negligent conduct. The mere 
        nonintentional repetition by an electronic system of an 
        initial clerical error does not constitute a pattern of 
        negligible conduct.
    (b) Procedures.--
        (1) Pre-penalty notice.--
                (A) In general.--If the Customs Service has 
                reasonable cause to believe that there has been 
                a violation of subsection (a) and determines 
                that further proceedings are warranted, it 
                shall issue to the person concerned a written 
                notice of its intention to issue a claim for a 
                monetary penalty. Such notice shall--
                          (i) describe the merchandise;
                          (ii) set forth the details of the 
                        entry or introduction, the attempted 
                        entry or introduction, or the aiding or 
                        procuring of the entry or introduction;
                          (iii) specify all laws and 
                        regulations allegedly violated;
                          (iv) disclose all the material facts 
                        which establish the alleged violation;
                          (v) state whether the alleged 
                        violation occurred as a result of 
                        fraud, gross negligence, or negligence;
                          (vi) state the estimated loss of 
                        lawful duties, taxes, and fees, if any, 
                        and, taking into account all 
                        circumstances, the amount of the 
                        proposed monetary penalty; and
                          (vii) inform such person that he 
                        shall have a reasonable opportunity to 
                        make representations, both oral and 
                        written, as to why a claim for a 
                        monetary penalty should not be issued 
                        in the amount stated.
                  (B) Exceptions.--The preceding subparagraph 
                shall not apply if--
                          (i) the importation with respect to 
                        which the violation of subsection (a) 
                        occurs is noncommercial in nature, or
                          (ii) the amount of the penalty in the 
                        penalty claim issued under paragraph 
                        (2) is $1,000 or less.
          (2) Penalty claim.--After considering 
        representations, if any, made by the person concerned 
        pursuant to the notice issued under paragraph (1), the 
        Customs Service shall determine whether any violation 
        of subsection (a), as alleged in the notice, has 
        occurred. If the Customs Service determines that there 
        was no violation, it shall promptly issue a written 
        statement of the determination to the person to whom 
        the notice was sent. If the Customs Service determines 
        that there was a violation, it shall issue a written 
        penalty claim to such person. The written penalty claim 
        shall specify all changes in the information provided 
        under clauses (i) through (vi) of paragraph (1)(A). 
        Such person shall have a reasonable opportunity under 
        section 618 of this Act to make representations, both 
        oral and written, seeking remission or mitigation of 
        the monetary penalty. At the conclusion of any 
        proceeding under such section 618, the Customs Service 
        shall provide to the person concerned a written 
        statement which sets forth the final determination and 
        the findings of fact and conclusions of law on which 
        such determination is based.
    (c) Maximum Penalties.--
          (1) Fraud.--A fraudulent violation of subsection (a) 
        is punishable by a civil penalty in an amount not to 
        exceed the domestic value of the merchandise.
          (2) Gross negligence.--A grossly negligent violation 
        of subsection (a) is punishable by a civil penalty in 
        an amount not to exceed--
                  (A) the lesser of--
                          (i) the domestic value of the 
                        merchandise, or
                          (ii) four times the lawful duties, 
                        taxes, and fees of which the United 
                        States is or may be deprived, or
                  (B) if the violation did not affect the 
                assessment of duties, 40 percent of the 
                dutiable value of the merchandise.
          (3) Negligence.--A negligent violation of subsection 
        (a) is punishable by a civil penalty in an amount not 
        to exceed--
                  (A) the lesser of--
                          (i) the domestic value of the 
                        merchandise, or
                          (ii) two times the lawful duties, 
                        taxes, and fees of which the United 
                        States is or may be deprived, or
                  (B) if the violation did not affect the 
                assessment of duties, 20 percent of the 
                dutiable value of the merchandise.
          (4) Prior disclosure.--If the person concerned 
        discloses the circumstances of a violation of 
        subsection (a) before, or without knowledge of, the 
        commencement of a formal investigation of such 
        violation, with respect to such violation, merchandise 
        shall not be seized and any monetary penalty to be 
        assessed under subsection (c) shall not exceed--
                (A) if the violation resulted from fraud--
                          (i) an amount equal to 100 percent of 
                        the lawful duties of which the United 
                        States is or may be deprived, so long 
                        as such person tenders the unpaid 
                        amount of the lawful duties, taxes, and 
                        fees at the time of disclosure, or 
                        within 30 days (or such longer period 
                        as the Customs Service may provide) 
                        after notice by the Customs Service of 
                        its calculation of such unpaid amount, 
                        or
                          (ii) if such violation did not affect 
                        the assessment of duties, 10 percent of 
                        the dutiable value; or
                  (B) if such violation resulted from 
                negligence or gross negligence, the interest 
                (computed from the date of liquidation at the 
                prevailing rate of interest applied under 
                section 6621 of the Internal Revenue Code of 
                1954) on the amount of lawful duties of which 
                the United States is or may be deprived so long 
                as such person tenders the unpaid amount of the 
                lawful duties, taxes, and fees at the time of 
                disclosure, or within 30 days (or such longer 
                period as the Customs Service may provide) 
                after notice by the Customs Service of its 
                calculation of such unpaid amount.
        The person asserting lack of knowledge of the 
        commencement of a formal investigation has the burden 
        of proof in establishing such lack of knowledge. For 
        purposes of this section, a formal investigation of a 
        violation is considered to be commenced with regard to 
        the disclosing party and the disclosed information on 
        the date recorded in writing by the Customs Service as 
        the date on which facts and circumstances were 
        discovered or information was received which caused the 
        Customs Service to believe that a possibility of a 
        violation of subsection (a) existed.
          (5) Prior disclosure regarding nafta claims.--An 
        importer shall not be subject to penalties under 
        subsection (a) for making an incorrect claim for 
        preferential tariff treatment under section 202 of the 
        North American Free Trade Agreement Implementation Act 
        if the importer--
                  (A) has reason to believe that the NAFTA 
                Certificate of Origin (as defined in section 
                508(b)(1)) on which the claim was based 
                contains incorrect information; and
                  (B) in accordance with regulations issued by 
                the Secretary, voluntarily and promptly makes a 
                corrected declaration and pays any duties 
                owing.
          (6) Seizure.--If the Secretary has reasonable cause 
        to believe that a person has violated the provisions of 
        subsection (a) and that such person is insolvent or 
        beyond the jurisdiction of the United States or that 
        seizure is otherwise essential to protect the revenue 
        of the United States or to prevent the introduction of 
        prohibited or restricted merchandise into the customs 
        territory of the United States, then such merchandise 
        may be seized and, upon assessment of a monetary 
        penalty, forfeited unless the monetary penalty is paid 
        within the time specified by law. Within a reasonable 
        time after any such seizure is made, the Secretary 
        shall issue to the person concerned a written statement 
        containing the reasons for the seizure. After seizure 
        of merchandise under this subsection, the Secretary 
        may, in the case of restricted merchandise, and shall, 
        in the case of any other merchandise (other than 
        prohibited merchandise), return such merchandise upon 
        the deposit of security not to exceed the maximum 
        monetary penalty which may be assessed under subsection 
        (c).
    (d) Deprivation of Lawful Duties, Taxes, or Fees.--
Notwithstanding section 514 of this Act, if the United States 
has been deprived of lawful duties, taxes, or fees as a result 
of a violation of subsection (a) the Customs Service shall 
require that such lawful duties, taxes and fees be restored, 
whether or not a monetary penalty is assessed.
    (e) Court of International Trade Proceedings.--
Notwithstanding any other provision of law, in any proceeding 
commenced by the United States in the Court of International 
Trade for the recovery of any monetary penalty claimed under 
this section--
          (1) all issues, including the amount of the penalty, 
        shall be tried de novo;
          (2) if the monetary penalty is based on fraud, the 
        United States shall have the burden of proof to 
        establish the alleged violation by clear and convincing 
        evidence;
          (3) if the monetary penalty is based on gross 
        negligence, the United States shall have the burden of 
        proof to establish all the elements of the alleged 
        violation; and
          (4) if the monetary penalty is based on negligence, 
        the United States shall have the burden of proof to 
        establish the act or omission constituting the 
        violation, and the alleged violator shall have the 
        burden of proof that the act or omission did not occur 
        as a result of negligence.
    (f) False Certifications Regarding Exports to NAFTA 
Countries.--
          (1) In general.--Subject to paragraph (3), it is 
        unlawful for any person to certify falsely, by fraud, 
        gross negligence, or negligence, in a NAFTA Certificate 
        of Origin (as defined in section 508(b)(1)) that a good 
        to be exported to a NAFTA country (as defined in 
        section 2(4) of the North American Free Trade Agreement 
        Implementation Act) qualifies under the rules of origin 
        set out in section 202 of that Act.
          (2) Applicable provisions.--The procedures and 
        penalties of this section that apply to a violation of 
        subsection (a) also apply to a violation of paragraph 
        (1), except that--
                  (A) subsection (d) does not apply, and
                  (B) subsection (c)(5) applies only if the 
                person voluntarily and promptly provides, to 
                all persons to whom the person provided the 
                NAFTA Certificate of Origin, written notice of 
                the falsity of the Certificate.
          (3) Exception.--A person may not be considered to 
        have violated paragraph (1) if--
                  (A) the information was correct at the time 
                it was provided in a NAFTA Certificate of 
                Origin but was later rendered incorrect due to 
                a change in circumstances; and
                  (B) the person voluntarily and promptly 
                provides written notice of the change to all 
                persons to whom the person provided the 
                Certificate of Origin.

SEC. 592A. SPECIAL PROVISIONS REGARDING CERTAIN VIOLATIONS.

    (a) Publication of Names of Certain Violators.--
          (1) Publication.--The Secretary of the Treasury is 
        authorized to publish in the Federal Register a list of 
        the name of any producer, manufacturer, supplier, 
        seller, exporter, or other person located outside the 
        customs territory of the United States--
                  (A) against whom the Customs Service has 
                issued a penalty claim under section 592, and
                  (B) if a petition with respect to that claim 
                has been filed under section 618, against whom 
                a final decision has been issued under such 
                section after exhaustion of administrative 
                remedies,
        citing any of the violations of the customs laws 
        referred to in paragraph (2). Such list shall be 
        published not later than March 31 and September 30 of 
        each year.
          (2) Violations.--The violations of the customs laws 
        referred to in paragraph (1) are the following:
                  (A) Using documentation, or providing 
                documentation subsequently used by the importer 
                of record, which indicates a false or 
                fraudulent country of origin or source of 
                textile or apparel products.
                  (B) Using counterfeit visas, licenses, 
                permits, bills of lading, or similar 
                documentation, or providing counterfeit visas, 
                licenses, permits, bills of lading, or similar 
                documentation that is subsequently used by the 
                importer of record, with respect to the entry 
                into the customs territory of the United States 
                of textile or apparel products.
                  (C) Manufacturing, producing, supplying, or 
                selling textile or apparel products which are 
                falsely or fraudulently labelled as to country 
                of origin or source.
                  (D) Engaging in practices which aid or abet 
                the transshipment, through a country other than 
                the country of origin, of textile or apparel 
                products in a manner which conceals the true 
                origin of the textile or apparel products or 
                permits the evasion of quotas on, or voluntary 
                restraint agreements with respect to, imports 
                of textile or apparel products.
          (3) Removal from list.--Any person whose name has 
        been included in a list published under paragraph (1) 
        may petition the Secretary to be removed from such 
        list. If the Secretary finds that such person has not 
        committed any violations described in paragraph (2) for 
        a period of not less than 3 years after the date on 
        which the person's name was so published, the Secretary 
        shall remove such person from the list as of the next 
        publication of the list under paragraph (1).
          (4) Reasonable care required for subsequent 
        imports.--
                  (A) Responsibility of importers and others.--
                After the name of a person has been published 
                under paragraph (1), the Secretary of the 
                Treasury shall require any importer of record 
                entering, introducing, or attempting to 
                introduce into the commerce of the United 
                States textile or apparel products that were 
                either directly or indirectly produced, 
                manufactured, supplied, sold, exported, or 
                transported by such named person to show, to 
                the satisfaction of the Secretary, that such 
                importer has exercised reasonable care to 
                ensure that the textile or apparel products are 
                accompanied by documentation, packaging, and 
                labelling that are accurate as to its origin. 
                Such reasonable care shall not include reliance 
                solely on a source of information which is the 
                named person.
                  (B) Failure to exercise reasonable care.--If 
                the Customs Service determines that merchandise 
                is not from the country claimed on the 
                documentation accompanying the merchandise, the 
                failure to exercise reasonable care described 
                in subparagraph (A) shall be considered when 
                the Customs Service determines whether the 
                importer of record is in violation of section 
                484(a).
    (b) List of High Risk Countries.--
          (1) List.--The President or his designee, upon the 
        advice of the Secretaries of Commerce and Treasury, and 
        the heads of other appropriate departments and 
        agencies, is authorized to publish a list of countries 
        in which illegal activities have occurred involving 
        transshipped textile or apparel products or activities 
        designed to evade quotas of the United States on 
        textile or apparel products, if those countries fail to 
        demonstrate a good faith effort to cooperate with 
        United States authorities in ceasing such activities. 
        Such list shall be published in the Federal Register 
        not later than March 31 of each year. Any country that 
        is on the list and that subsequently demonstrates a 
        good faith effort to cooperate with United States 
        authorities in ceasing illegal activities described in 
        the first sentence shall be removed from the list, and 
        such removal shall be published in the Federal Register 
        as soon as practicable.
          (2) Reasonable care required for subsequent 
        imports.--
                  (A) Responsibility of importers of record.--
                The Secretary of the Treasury shall require any 
                importer of record entering, introducing, or 
                attempting to introduce into the commerce of 
                the United States textile or apparel products 
                indicated, on the documentation, packaging, or 
                labelling accompanying such products, to be 
                from any country on the list published under 
                paragraph (1) to show, to the satisfaction of 
                the Secretary, that such importer, consignee, 
                or purchaser has exercised reasonable care to 
                ascertain the true country of origin of the 
                textile or apparel products.
                  (B) Failure to exercise reasonable care.--If 
                the Customs Service determines that merchandise 
                is not from the country claimed on the 
                documentation accompanying the merchandise, the 
                failure to exercise reasonable care described 
                in subparagraph (A) shall be considered when 
                the Customs Service determines whether the 
                importer of record is in violation of section 
                484(a).
          (3) Definition.--For purposes of this subsection, the 
        term ``country'' means a foreign country or territory, 
        including any overseas dependent territory or 
        possession of a foreign country.

  (B)  CONVICT AND FORCED LABOR MADE GOODS

        [19 U.S.C. 1307, P.L. 71-361 as amended by P.L. 106-200]

SEC. 307. CONVICT MADE GOODS; IMPORTATION PROHIBITED

    All goods, wares, articles, and merchandise mined, produced 
or manufactured wholly or in part in any foreign country by 
convict labor or/and forced labor or/and indentured labor under 
penal sanctions shall not be entitled to entry at any of the 
ports of the United States, and the importation thereof is 
hereby prohibited, and the Secretary of the Treasury is 
authorized and directed to prescribe such regulations as may be 
necessary for the enforcement of this provision. The provisions 
of this section relating to goods, wares, articles, and 
merchandise mined, produced, or manufactured by forced labor 
or/and indentured labor, shall take effect on January 1, 1932; 
but in no case shall such provisions be applicable to goods, 
wares, articles, or manufactured in such quantities in the 
United States as to meet the consumptive demands of the United 
States.
    ``Forced labor'', as herein used, shall mean all work or 
service which is exacted from any person under the menace of 
any penalty for its nonperformance and for which the worker 
does not offer himself voluntarily. For purposes of this 
section, the term ``forced labor or/and indentured labor'' 
includes forced or indentured child labor.

  (C)  PROHIBITION ON IMPORTATION OF DOG AND CAT FUR PRODUCTS.

        [19 U.S.C. 1308, P.L. 71-361 as amended by P.L. 106-476]

SEC. 308. PROHIBITION ON IMPORTATION OF DOG AND CAT FUR PRODUCTS.

    (a) Definitions.--In this section:
          (1) Cat fur.--The term ``cat fur'' means the pelt or 
        skin of any animal of the species Felis catus.
          (2) Interstate commerce.--The term ``interstate 
        commerce'' means the transportation for sale, trade, or 
        use between any State, territory, or possession of the 
        United States, or the District of Columbia, and any 
        place outside thereof.
          (3) Cusoms laws.--The term ``customs laws of the 
        United States'' means any other law or regulation 
        enforced or administered by the United States Customs 
        Service.
          (4) Designated authority.--The term ``designated 
        authority'' means the Secretary of the Treasury, with 
        respect to the prohibitions under subsection (b)(1)(A), 
        and the President (or the President's designee), with 
        respect to the prohibitions under subsection (b)(1)(B).
          (5) Dog fur.--The term ``dog fur'' means the pelt or 
        skin of any animal of the species Canis familiaris
          (6) Dog or cat fur product.--The term ``dog and cat 
        fur product'' means any item of merchandise which 
        consists, or is composed in whole or in part, of any 
        dog fur, cat fur, or both.
          (7) Person.--The term ``person'' includes any 
        individual, partnership, corporation, association, 
        organization, business trust, government entity, or 
        other entity subject to the jurisdiction of the United 
        States.
          (8) United states.--The term ``United States'' means 
        the customs territory of the United States, as defined 
        in general note 2 of the Harmonized Tariff Schedule of 
        the United States.
    (b) Prohibitions.--
          (1) In general.--It shall be unlawful for any person 
        to--
                  (A) import into, or export from the United 
                States any dog or cat fur product; or
                  (B) introduce into interstate commerce, 
                manufacture for introduction into interstate 
                commerce, sell, trade, or advertise in 
                interstate commerce, offer to sell, or 
                transport or distribute in interste commerce in 
                the United States, any dog or cat fur product.
          (2) Exception.--This subsection shall not apply to 
        the importation, exportation, or transportation, for 
        noncommercial purposes, of a personal pet that is 
        deceased, including a pet preserved through taxidermy.
    (c)  Penalties and Enforcement.--
                  (1) Civil penalties.--
                          (A) In general.--Any person who 
                        violates any provision of this section 
                        or any regulation issued under this 
                        section may, in addition to any other 
                        civil or criminal penalty that may be 
                        imposed under title 18, United States 
                        Code, or any other provision of law, be 
                        assessed a civil penalty by the 
                        designated authority of not more than--
                                  (i) $10,000 for each separate 
                                knowing and intentional 
                                violation;
                                  (ii) $5,000 for each separate 
                                grossly negligent violation; or
                                  (iii) $3,000 for each 
                                separate negligent violation.
                  (B) Debarment.--The designated authority may 
                prohibit a person from importing, exporting, 
                transporting, distributing, manufacturing, or 
                selling any fur product in the United States, 
                if the designated authority finds that the 
                person has engaged in a pattern or practice of 
                actions that has resulted in a final 
                administrative determination with respect to 
                the assessment of civil penalties for knowing 
                and intentional or grossly negligent violations 
                of any provision of this section or any 
                regulation issued under this section
                  (C) Factors in assessing penalties.--In 
                determining the amount of civil penalties under 
                this paragraph, the designated authority shall 
                take into account the degree of culpability, 
                any history or prior violations under this 
                section, ability to pay, the seriousness of the 
                violation, and such other matters as fairness 
                may require.
                  (D) Notice.--No penalty may be assessed under 
                this paragraph against a person unless the 
                person is given notice and opportunity for a 
                hearing with respect to such violation in 
                accordance with section 554 of title 5, United 
                States Code.
          (2) Forfeiture.--Any dog or cat fur product 
        manufactured, taken, possessed, sold, purchased, 
        offered for sale or purchase, transported, delivered, 
        received, carried, shipped, imported, or exported 
        contrary to the provisions of this section or any 
        regulation issued under this section shall be subject 
        to forfeiture to the United States.
          (3) Enforcement.--The Secretary of the Treasury shall 
        enforce the provisions of this section with respect to 
        the prohibitions under subsection (b)(1)(B).
          (4) Regulations.--Not later than 270 days after the 
        date of the enactment of this section, the designated 
        authorities shall, after notice and opportunity for 
        comment, issue regulations to carry out the provisions 
        of this section. The regulations of the Secretary of 
        the Treasury shall provide for a process by which 
        testing laboratories, whether domestic or foreign, can 
        qualify for certification by the United States Customs 
        Service by demonstrating the reliability of the 
        procedures used for determining the type of fur 
        contained in articles intended for sale or consumption 
        in interstate commerce. Use of a laboratory certified 
        by the United States Customs Service to determine the 
        nature of fur contained in an item to which subsection 
        (b) applies is not required to avoid lability under 
        this section.--but may, in a case in which a person can 
        establish that the goods imported were tested by such a 
        laboratory and that the item was not found to be a dog 
        or cat fur product, prove dispositive in determining 
        whether that person exercised reasonable care for 
        purposes of paragraph (6).
          (5) Reward.--The designated authority shall pay a 
        reward of not less then $500 to any person who 
        furnishes information that establishes or leads to a 
        civil penalty assessment, debarment, or forfeiture of 
        property for any violation of this section or any 
        regulation issued under this section.
          (6) Affirmative defense.--Any person accused of a 
        violation under this section has a defense to any 
        proceeding brought under this section on account of 
        such violation if that person establishes by a 
        preponderance of the evidence that the person exercised 
        reasonable care--
                  (A) in determining the nature of the products 
                alleged to have resulted in such violation; and
                  (B) in ensuring that the products were 
                accompanied by documentation, packaging, and 
                labeling that were accurate as to the nature of 
                the products.
          (7) Coordination with other laws.--Nothing in this 
        section shall be construed as superseding or limiting 
        in any manner the functions and responsibilities of the 
        Secretary of the Treasury under the customs laws of the 
        United States.
    (d) Publication of Names of Certain Violators.--The 
designated authorities shall, at least once each year, publish 
in the Federal Register a list of the names of any producer, 
manufacturer, supplier, seller, importer, or exporter, whether 
or not located within the customs territory of the United 
States or subject to the jurisdiction of the United States, 
against whom a final administrative determination with respect 
to the assessment of a civil penalty for a knowing and 
intentional or a grossly negligent violation has been made 
under this section.
    (e) Reports.--In order to enable Congress to engage in 
active continuing oversight of this section, the designated 
authorities shall provide the following:
          (1) Plan for enforcement.--Within 3 months after the 
        date of the enactment of this section, the designated 
        authorities shall submit to Congress a plan for the 
        enforcement of the provisions of this section, 
        including training and procedures to ensure that United 
        States Government personnel are equipped with state-of-
        the-art technologies to identify potential dog or cat 
        fur products and to determine the true content of such 
        products.
          (2) Report on enforcement efforts.--Not later than 1 
        year after the date of the enactment of this section, 
        and on an annual basis thereafter, the designated 
        authorities shall submit a report to Congress on the 
        efforts of the United States Government to enforce the 
        provisions of this section and the adequacy of the 
        resources to do so. The report shall include an 
        analysis of the training of United States Government 
        personnel to identify dog and cat fur products 
        effectively and to take appropriate action to enforce 
        this section. The report shall include the findings of 
        the designated authorities as to whether any government 
        has engaged in a pattern or practice of support for 
        trade in products the importation of which are 
        prohibited under this section.

  (D) CIGARETTE IMPORTS

 Title VIII--Requirements Application to Imports of Certain Cigarettes


   [19 U.S.C. 1681, et seq., P.L. 71-361, as amended by P.L. 106-476]

SEC. 801. DEFINITIONS.

    In this title:
          (1) Secretary.--Except as otherwise indicated, the 
        term ``Secretary'' means the Secretary of the Treasury.
          (2) Primary packaging.--The term ``primary 
        packaging'' refers to the permanent packaging inside of 
        the innermost cellophane or other transparent wrapping 
        and labels, if any. Warnings or other statements shall 
        be deemed `permanently imprinted' only if printed 
        directly on such primary packaging and not by way of 
        stickers or other similar devices.

SEC. 802. REQUIREMENTS FOR ENTRY OF CERTAIN CIGARETTES.

    (a) General Rule.--Except as provided in subsection (b), 
cigarettes may be imported into the United States only if--
          (1) the original manufacturer of those cigarettes has 
        timely submitted, or has certified that it will timely 
        submit to the Secretary of Health and Human Services 
        the lists of the ingredients added to the tobacco in 
        the manufacture of such cigarettes as described in 
        section 7 of the Federal Cigarette Labeling and 
        Advertising Act (15 U.S.C. 1335a);
          (2) the precise warning statements in the precise 
        format specified in section 4 of the Federal Cigarette 
        Labeling and Advertising Act (15 U.S.C. 1333) are 
        permanently imprinted on both--
                  (A) the primary packaging of all those 
                cigarettes; and
                  (B) any other pack, box, carton, or container 
                of any kind in which those cigarettes are to be 
                offered for sale or otherwise distributed to 
                consumers;
          (3) the manufacturer or importer of those cigarettes 
        is in compliance with respect to those cigarettes being 
        imported into the United States with a rotation plan 
        approved by the Federal Trade Commission pursuant to 
        section 4(c) of the Federal Cigarette Labeling and 
        Advertising Act (15 U.S.C. 1333(c));
          (4) if such cigarettes bear a United States trademark 
        registered for such cigarettes, the owner of such 
        United States trademark registration for cigarettes (or 
        a person authorized to act on behalf of such owner) has 
        consented to the importation of such cigarettes into 
        the United States; and
          (5) the importer has submitted at the time of entry 
        all of the certificates described in subsection (c).
    (b) Exemptions.--Cigarettes satisfying the conditions of 
any of the following paragraphs shall not be subject to the 
requirements of subsection (a):
          (1) Personal-use cigarettes.--Cigarettes that are 
        imported into the United States in personal use 
        quantities that are allowed entry free of tax and duty 
        under subchapter IV of chapter 98 of the Harmonized 
        Tariff Schedule of the United States.
          (2) Cigarettes imported into the united states for 
        analysis.--Cigarettes that are imported into the United 
        States solely for the purpose of analysis in quantities 
        suitable for such purpose, but only if the importer 
        submits at the time of entry a certificate signed, 
        under penalties of perjury, by the consignee (or a 
        person authorized by such consignee) providing such 
        facts as may be required by the Secretary to establish 
        that such consignee is a manufacturer of cigarettes, a 
        Federal or State government agency, a university, or is 
        otherwise engaged in bona fide research and stating 
        that such cigarettes will be used solely for analysis 
        and will not be sold in domestic commerce in the United 
        States.
          (3) Cigarettes intended for noncommercial use, 
        reexport, or repackaging.--Cigarettes--
                  (A) for which the owner of such United States 
                trademark registration for cigarettes (or a 
                person authorized to act on behalf of such 
                owner) has consented to the importation of such 
                cigarettes into the United States; and
                  (B) for which the importer submits a 
                certificate signed by the manufacturer or 
                export warehouse (or a person authorized by 
                such manufacturer or export warehouse) to which 
                such cigarettes are to be delivered (as 
                provided in subparagraph (A)) stating, under 
                penalties of perjury, with respect to those 
                cigarettes, that it will not distribute those 
                cigarettes into domestic commerce unless prior 
                to such distribution all steps have been taken 
                to comply with paragraphs (1), (2), and (3) of 
                subsection (a), and, to the extent applicable, 
                section 5754(a)(1) (B) and (C) of the Internal 
                Revenue Code of 1986.
For purpose of this section, a trademark is registered in the 
United States if it is registered in the United States Patent 
and Trademark Office under the provisions of title I of the Act 
of July 5, 1946 (popularly known as the `Trademark Act of 
1946'), and a copy of the certificate of registration of such 
mark has been filed with the Secretary. The Secretary shall 
make available to interested parties a current list of the 
marks so filed.
    (c) Customs Certifications Required for Cigarette 
Imports.--The certificates that must be submitted by the 
importer of cigarettes at the time of entry in order to comply 
with subsection (a)(5) are--
          (1) a certificate signed by the manufacturer of such 
        cigarettes or an authorized official of such 
        manufacturer stating under penalties of perjury, with 
        respect to those cigarettes, that such manufacturer has 
        timely submitted, and will continue to submit timely, 
        to the Secretary of Health and Human Services the 
        ingredient reporting information required by section 7 
        of the Federal Cigarette Labeling and Advertising Act 
        (15 U.S.C. 1335a);
          (2) a certificate signed by such importer or an 
        authorized official of such importer stating under 
        penalties of perjury that--
                  (A) the precise warning statements in the 
                precise format required by section 4 of the 
                Federal Cigarette Labeling and Advertising Act 
                (15 U.S.C. 1333) are permanently imprinted on 
                both--
                          (i) the primary packaging of all 
                        those cigarettes; and
                          (ii) any other pack, box, carton, or 
                        container of any kind in which those 
                        cigarettes are to be offered for sale 
                        or otherwise distributed to consumers; 
                        and
                  (B) with respect to those cigarettes being 
                imported into the United States, such importer 
                has complied, and will continue to comply, with 
                a rotation plan approved by the Federal Trade 
                Commission pursuant to section 4(c) of the 
                Federal Cigarette Labeling and Advertising Act 
                (15 U.S.C. 1333(c)); and
    (3)(A) if such cigarettes bear a United States trademark 
registered for cigarettes, a certificate signed by the owner of 
such United States trademark registration for cigarettes (or a 
person authorized to act on behalf of such owner) stating under 
penalties of perjury that such owner (or authorized person) 
consents to the importation of such cigarettes into the United 
States; and
    (B) a certificate signed by the importer or an authorized 
official of such importer stating under penalties of perjury 
that the consent referred to in subparagraph (A) is accurate, 
remains in effect, and has not been withdrawn.
The Secretary may provide by regulation for the submission of 
certifications under this section in electronic form if, prior 
to the entry of any cigarettes into the United States, the 
person required to provide such certifications submits to the 
Secretary a written statement, signed under penalties of 
perjury, verifying the accuracy and completeness of all 
information contained in such electronic submissions.

SEC. 803. ENFORCEMENT.

    (a) Civil Penalty.--Any person who violates a provision of 
section 802 shall, in addition to the tax and any other penalty 
provided by law, be liable for a civil penalty for each 
violation equal to the greater of $1,000 or 5 times the amount 
of the tax imposed by chapter 52 of the Internal Revenue Code 
of 1986 on all cigarettes that are the subject of such 
violation.
    (b) Forfeitures.--Any tobacco product, cigarette papers, or 
tube that was imported into the United States or is sought to 
be imported into the United States in violation of, or without 
meeting the requirements of, section 802 shall be forfeited to 
the United States. Notwithstanding any other provisions of law, 
any product forfeited to the United States pursuant to this 
title shall be destroyed.

                 7. National Customs Automation Program


 Part I, Subpart B of Title IV (Sections 411-414) of the Tariff Act of 
                            1930, as amended


 [19 U.S.C. 1411, P.L. 103-182 as amended by P.L. 104-295 and P.L. 106-
                                  36]

SEC. 411. NATIONAL CUSTOMS AUTOMATION PROGRAM.

    (a) Establishment.--The Secretary shall establish the 
National Customs Automation Program (hereinafter in this 
subpart referred to as the ``Program'') which shall be an 
automated and electronic system for processing commercial 
importations and shall include the following existing and 
planned components:
          (1) Existing components:
                  (A) The electronic entry of merchandise.
                  (B) The electronic entry summary of required 
                information.
                  (C) The electronic transmission of invoice 
                information.
                  (D) The electronic transmission of manifest 
                information.
                  (E) Electronic payments of duties, fees, and 
                taxes.
                  (F) The electronic status of liquidation and 
                reliquidation.
                  (G) The electronic selection of high risk 
                entries for examination (cargo selectivity and 
                entry summary selectivity).
          (2) Planned components:
                  (A) The electronic filing and status of 
                protests.
                  (B) The electronic filing (including remote 
                filing under section 414) of entry information 
                with the Customs Service at any location.
                  (C) The electronic filing of import activity 
                summary statements and reconciliation.
                  (D) The electronic filing of bonds.
                  (E) The electronic penalty process.
                  (F) The electronic filing of drawback claims, 
                records, or entries.
                  (G) Any other component initiated by the 
                Customs Service to carry out the goals of this 
                subpart.
    (b) Participation in Program.--The Secretary shall by 
regulation prescribe the eligibility criteria for participation 
in the Program. Participation in the Program is voluntary.
    (c) Foreign-Trade Zones.--Not later than January 1, 2000, 
the Secretary shall provide for the inclusion of commercial 
importation data from foreign-trade zones under the Program.

SEC. 412. PROGRAM GOALS.

    The goals of the Program are to ensure that all regulations 
and rulings that are administered or enforced by the Customs 
Service are administered and enforced in a manner that--
          (1) is uniform and consistent;
          (2) is as minimally intrusive upon the normal flow of 
        business activity as practicable; and
          (3) improves compliance.

SEC. 413. IMPLEMENTATION AND EVALUATION OF PROGRAM.

    (a) Overall Program Plan.--
          (1) In general.--Before the 180th day after the date 
        of the enactment of the North American Free Trade 
        Agreement Implementation Act, the Secretary shall 
        develop and transmit to the Committees an overall plan 
        for the Program. The overall Program plan shall set 
        forth--
                  (A) a general description of the ultimate 
                configuration of the Program;
                  (B) a description of each of the existing 
                components of the Program listed in section 
                411(a)(1); and
                  (C) estimates regarding the stages on which 
                planned components of the Program listed in 
                section 411(a)(2) will be brought on-line.
          (2) Additional information.--In addition to the 
        information required under paragraph (1), the overall 
        Program plan shall include a statement regarding--
                  (A) the extent to which the existing 
                components of the Program currently meet, and 
                the planned components will meet, the Program 
                goals set forth in section 412; and
                  (B) the effects that the existing components 
                are currently having, and the effects that the 
                planned components will likely have, on--
                          (i) importers, brokers, and other 
                        users of the Program, and
                          (ii) Customs Service occupations, 
                        operations, processes, and systems.
    (b) Implementation Plan, Testing, and Evaluation.--
          (1) Implementation plan.--For each of the planned 
        components of the Program listed in section 411(a)(2), 
        the Secretary shall--
                  (A) develop an implementation plan;
                  (B) test the component in order to assess its 
                viability;
                  (C) evaluate the component in order to assess 
                its contribution toward achieving the program 
                goals; and
                  (D) transmit to the Committees the 
                implementation plan, the testing results, and 
                an evaluation report.
        In developing an implementation plan under subparagraph 
        (A) and evaluating components under subparagraph (C), 
        the Secretary shall publish a request for comments in 
        the Customs Bulletin and shall consult with the trade 
        community, including importers, brokers, shippers, and 
        other affected parties.
          (2) Implementation.--
                  (A) The Secretary may implement on a 
                permanent basis any Program component referred 
                to in paragraph (1) on or after the date which 
                is 30 days after paragraph (1)(D) is complied 
                with.
                  (B) For purposes of subparagraph (A), the 30 
                days shall be computed by excluding--
                          (i) the days either House is not in 
                        session because of an adjournment of 
                        more than 3 days to a day certain or an 
                        adjournment of the Congress sine die, 
                        and
                          (ii) any Saturday and Sunday, not 
                        excluded under clause (i), when either 
                        House is not in session.
          (3) Evaluation and report.--The Secretary shall--
                  (A) develop a user satisfaction survey of 
                parties participating in the Program;
                  (B) evaluate the results of the user 
                satisfaction survey on a biennial basis (fiscal 
                years) and transmit a report to the Committees 
                on the evaluation by no later than the 90th day 
                after the close of each 2d fiscal year.
                  (C) with respect to the existing Program 
                component listed in section 411(a)(1)(G) 
                transmit to the Committees--
                          (i) a written evaluation of such 
                        component before the 180th day after 
                        the date of the enactment of this 
                        section and before the implementation 
                        of the planned Program components 
                        listed in section 411(a)(2) (B) and 
                        (C), and
                          (ii) a report on such component for 
                        each of the 3 full fiscal years 
                        occurring after the date of the 
                        enactment of this section, which report 
                        shall be transmitted not later than the 
                        90th day after the close of each such 
                        year; and
                  (D) not later than the 90th day after the 
                close of fiscal year 1994, and annually 
                thereafter through fiscal year 2000, transmit 
                to the Committees a written evaluation with 
                respect to the implementation and effect on 
                users of each of the planned Program components 
                listed in section 411(a)(2).
        In carrying out the provisions of this paragraph, the 
        Secretary shall publish requests for comments in the 
        Customs Bulletin and shall consult with the trade 
        community, including importers, brokers, shippers, and 
        other affected parties.
    (c) Committees.--For purposes of this section, and the term 
``Committees'' means the Committee on Ways and Means of the 
House of Representatives and the Committee on Finance of the 
Senate.

SEC. 414. REMOTE LOCATION FILING.

    (a) Core Entry Information.--
          (1) In general.--A Program participant may file 
        electronically an entry of merchandise with the Customs 
        Service from a location other than the district 
        designated in the entry for examination (hereafter in 
        this section referred to as a ``remote location'') if--
                  (A) the Customs Service is satisfied that the 
                participant has the capabilities referred to in 
                paragraph (2)(A) regarding such method of 
                filing; and
                  (B) the participant elects to file from the 
                remote location.
          (2) Requirements.--
                  (A) In general.--In order to qualify for 
                filing from a remote location, a Program 
                participant must have the capability to 
                provide, on an entry-by-entry basis, for the 
                following:
                          (i) The electronic entry of 
                        merchandise.
                          (ii) The electronic entry summary of 
                        required information.
                          (iii) The electronic transmission of 
                        invoice information (when required by 
                        the Customs Service).
                          (iv) The electronic payment of 
                        duties, fees, and taxes.
                          (v) Such other electronic 
                        capabilities within the existing or 
                        planned components of the Program as 
                        the Secretary shall by regulation 
                        require.
                  (B) Restriction on exemption from 
                requirements.--The Customs Service may not 
                permit any exemption or waiver from the 
                requirements established by this section for 
                participation in remote entry filing.
          (3) Conditions on filing under this section.--The 
        Secretary may prohibit a Program participant from 
        participating in remote location filing, and may remove 
        a Program participant from participation in remote 
        location filing, if the participant--
                  (A) fails to meet all the compliance 
                requirements and operational standards of 
                remote location filing; or
                  (B) fails to adhere to all applicable laws 
                and regulations.
          (4) Alternative filing.--Any Program participant that 
        is eligible to file entry information electronically 
        from a remote location but chooses not to do so in the 
        case of any entry must file any paper documentation for 
        the entry at the designated location referred to in 
        subsection (d).
    (b) Additional Entry Information.--
          (1) In general.--A Program participant that is 
        eligible under subsection (a) to file entry information 
        from a remote location may, if the Customs Service is 
        satisfied that the participant meets the requirements 
        under paragraph (2), also electronically file from the 
        remote location additional information that is required 
        by the Customs Service to be presented before the 
        acceptance of entry summary information and at the time 
        of acceptance of entry summary information.
          (2) Requirements.--The Secretary shall publish, and 
        periodically update, a list of those capabilities 
        within the existing and planned components of the 
        Program that a Program participant must have for 
        purposes of this subsection.
          (3) Filing of additional information.--
                  (A) If information electronically 
                acceptable.--A Program participant that is 
                eligible under paragraph (1) to file additional 
                information from a remote location shall 
                electronically file all such information that 
                the Customs Service can accept electronically.
                  (B) Alternative filing.--If the Customs 
                Service cannot accept additional information 
                electronically, the Program participant shall 
                file the paper documentation with respect to 
                the information at the appropriate filing 
                location.
                  (C) Appropriate location.--For purposes of 
                subparagraph (B), the ``appropriate location'' 
                is--
                          (i) before January 1, 1999, a 
                        designated location; and
                          (ii) after December 31, 1998--
                                  (I) if the paper 
                                documentation is required for 
                                release, a designated location; 
                                or
                                  (II) if the paper 
                                documentation is not required 
                                for release, a remote location 
                                designated by the Customs 
                                Service or a designated 
                                location.
                  (D) Other.--A Program participant that is 
                eligible under paragraph (1) to file additional 
                information electronically from a remote 
                location but chooses not to do so must file the 
                paper documentation with respect to the 
                information at a designated location.
    (c) Post-Entry Summary Information.--A Program participant 
that is eligible to file electronically entry information under 
subsection (a) and additional information under subsection (b) 
from a remote location may file at any remote location 
designated by the Customs Service any information required by 
the Customs Service after entry summary.
    (d) Definitions.--As used in this section:
          (1) The term ``designated location'' means a customs 
        office located in the customs district designated by 
        the entry filer for purposes of customs examination of 
        the merchandise.
          (2) The term ``Program participant'' means, with 
        respect to an entry of merchandise, any party entitled 
        to make the entry under section 484(a)(2)(B).

                        8. Commercial Operations


    Section 9503(c) of the Omnibus Budget Reconciliation Act of 1987


                  [19 U.S.C. 2071 note; P.L. 100-203]

SEC. 9503. UNITED STATES CUSTOMS SERVICE AUTHORIZATIONS.

           *       *       *       *       *       *       *


    (c) Advisory Committee on Commercial Operations of the 
United States Customs Service.--
          (1) The Secretary of the Treasury shall establish an 
        advisory committee which shall be known as the 
        ``Advisory Committee on Commercial Operations of the 
        United States Customs Service'' (hereafter in this 
        subsection referred to as the ``Advisory Committee'').
          (2)(A) The Advisory Committee shall consist of 20 
        members appointed by the Secretary of the Treasury.
          (B) In making appointments under subparagraph (A), 
        the Secretary of the Treasury shall ensure that--
                  (i) the membership of the Advisory Committee 
                is representative of the individuals and firms 
                affected by the commercial operations of the 
                United States Customs Service; and
                  (ii) a majority of the members of the 
                Advisory Committee do not belong to the same 
                political party.
          (3) The Advisory Committee shall--
                  (A) provide advice to the Secretary of the 
                Treasury on all matters involving the 
                commercial operations of the United States 
                Customs Service; and
                  (B) submit an annual report to the Committee 
                on Finance of the Senate and the Committee on 
                Ways and Means of the House of Representatives 
                that shall--
                          (i) describe the operations of the 
                        Advisory Committee during the preceding 
                        year, and
                          (ii) set forth any recommendations of 
                        the Advisory Committee regarding the 
                        commercial operations of the United 
                        States Customs Service.
          (4) The Assistant Secretary of the Treasury for 
        Enforcement shall preside over meetings of the Advisory 
        Committee.

Section 301 of the Customs Procedural Reform and Simplification Act of 
                            1978, as amended


 [19 U.S.C. 2075; P.L. 95-410, as amended by P.L. 97-456, P.L. 98-573, 
P.L. 99-272, P.L. 99-509, P.L. 100-203, P.L. 100-690, P.L. 101-207, and 
                             P.L. 101-382]

SEC. 301. CUSTOMS SERVICE APPROPRIATIONS AUTHORIZATION.

    (a) In General.--
          (1) For the fiscal year beginning October 1, 1979, 
        and each fiscal year thereafter, there are authorized 
        to be appropriated to the Department of the Treasury 
        for the United States Customs Service only such sums as 
        may hereafter be authorized by law.
          (2) The authorization of the appropriations for the 
        United States Customs Service for each fiscal year 
        after fiscal year 1987 shall specify--
                  (A) the amount authorized for the fiscal year 
                for the salaries and expenses of the Service in 
                conducting commercial operations; and
                  (B) the amount authorized for the fiscal year 
                for the salaries and expenses of the Service 
                for other than commercial operations.
    (b) Authorization of Appropriations.--
          (1) For noncommercial operations.--There are 
        authorized to be appropriated for the salaries and 
        expenses of the Customs Service that are incurred in 
        noncommercial operations not to exceed the following:
                  (A) $516,217,000 for fiscal year 1991.
                  (B) $542,091,000 for fiscal year 1992.
          (2) For commercial operations.--(A) There are 
        authorized to be appropriated for the salaries and 
        expenses of the Customs Service that are incurred in 
        commercial operations not less than the following:
                  (i) $672,021,000 for fiscal year 1991.
                  (ii) $705,793,000 for fiscal year 1992.
          (B) The monies authorized to be appropriated under 
        subparagraph (A) for any fiscal year, except for such 
        sums as may be necessary for the salaries and expenses 
        of the Customs Service that are incurred in connection 
        with the processing of merchandise that is exempt from 
        the fees imposed under section 13031(a)(9) and (10) of 
        the Consolidated Omnibus Budget Reconciliation Act of 
        1985, shall be appropriated from the Customs User Fee 
        Account.
          (3) For air interdiction.--There are authorized to be 
        appropriated for the operation (including salaries and 
        expenses) and maintenance of the air interdiction 
        program of the Customs Service not to exceed the 
        following:
                  (A) $143,047,000 for fiscal year 1991.
                  (B) $150,199,000 for fiscal year 1992.
    (c) Mandatory 10-Day Deferment.--No part of any sum that is 
appropriated under the authority of subsection (b) of this 
section may be used to implement any procedure relating to the 
time of collection of estimated duties that shortens the 
maximum 10-day deferment procedure in effect on January 1, 
1981.
    (d) Overtime Pay Limitations; Waiver.--No part of any sum 
that is appropriated under subsection (b) of this section for 
fiscal years after September 30, 1984, may be used for 
administrative expenses to pay any employee of the United 
States Customs Service overtime pay in an amount exceeding 
$25,000; except that the Commissioner of Customs or his 
designee may waive this limitation in individual cases in order 
to prevent excessive costs or to meet emergency requirements of 
the Service.
    (e) Pay Comparability Authorization.--For the fiscal year 
beginning October 1, 1982, and for each fiscal year thereafter, 
there are authorized to be appropriated to the Department of 
the Treasury for salaries of the United States Customs Service 
such additional sums as may be provided by law to reflect pay 
rate changes made in accordance with the Federal Pay 
Comparability Act of 1970 [5 U.S.C.A. Sec. 5301 et seq.].
    (f) If savings in salaries and expenses result from the 
consolidation of administrative functions within the Customs 
Service, the Commissioner of Customs shall apply those savings, 
to the extent they are not needed to meet emergency 
requirements of the Service, to strengthening the commercial 
operations of the Service by increasing the number of 
inspector, import specialist, patrol officer, and other line 
operational positions.
    (g)(1) The Commissioner of Customs shall ensure that 
existing levels of commercial services, including inspection 
and control, classification, and value, shall continue to be 
provided by Customs personnel assigned to the headquarters 
office of any Customs district designated by statute before 
April 7, 1986. The number of such personnel assigned to any 
such district headquarters shall not be reduced through 
attrition or otherwise, and such personnel shall be afforded 
the opportunity to maintain their proficiency through training 
and workshops to the same extent provided to Customs personnel 
in any other district. Automation and other modernization 
equipment shall be made available, as needed on a timely basis, 
to such headquarters to the same extent as such equipment is 
made available to any other district headquarters.
    (2) The Commissioner of Customs shall notify the Committee 
on Finance of the Senate and the Committee on Ways and Means of 
the House of Representatives at least 180 days prior to taking 
any action which would--
          (A) result in any significant reduction in force of 
        employees other than by means of attrition;
          (B) result in any significant reduction in hours of 
        operation or services rendered at any office of the 
        United States Customs Service or any port of entry;
          (C) eliminate or relocate any office of the United 
        States Customs Service;
          (D) eliminate any port of entry; or
          (E) significantly reduce the number of employees 
        assigned to any office of the United States Customs 
        Service or any port of entry.
    (3) The total number of employees of the United States 
Customs Service shall be equivalent to at least 17,174 full-
time employees.

                         J. FOREIGN TRADE ZONES


                    Act of June 18, 1934, as amended


 [19 U.S.C. 81a-u; Act of June 18, 1934, as amended by Act of June 17, 
1950, P.L. 85-791, P.L. 91-271, P.L. 96-609, P.L. 98-573, P.L. 99-514, 
 P.L. 100-418, P.L. 100-449, P.L. 100-647, P.L. 101-382, P.L. 103-182, 
                    P.L. 104-201, and P.L. 104-295]

SECTION 1. DEFINITIONS.

    When used in this chapter--
          (a) The term ``Secretary'' means the Secretary of 
        Commerce;
          (b) The term ``Board'' means the Board which is 
        established to carry out the provisions of this 
        chapter. The Board shall consist of the Secretary of 
        Commerce, who shall be chairman and executive officer 
        of the Board, and the Secretary of the Treasury;
          (c) The term ``State'' includes any State, the 
        District of Columbia, and Puerto Rico;
          (d) The term ``corporation'' means a public 
        corporation and a private corporation, as defined in 
        this chapter;
          (e) The term ``public corporation'' means a State, 
        political subdivision thereof, a municipality, a public 
        agency of a State, political subdivision thereof, or 
        municipality, or a corporate municipal instrumentality 
        of one or more States;
          (f) The term ``private corporation'' means any 
        corporation (other than a public corporation) which is 
        organized for the purpose of establishing, operating, 
        and maintaining a foreign-trade zone and which is 
        chartered under special Act enacted after June 18, 
        1934, of the State or States within which it is to 
        operate such zone;
          (g) The term ``applicant'' means a corporation 
        applying for the right to establish, operate, and 
        maintain a foreign-trade zone;
          (h) The term ``grantee'' means a corporation to which 
        the privilege of establishing, operating, and 
        maintaining a foreign-trade zone has been granted;
          (i) The term ``zone'' means a ``foreign-trade zone'' 
        as provided in this chapter.

SEC. 2. ESTABLISHMENT OF ZONES.

    (a) Board Authorization To Grant Zones.--The Board is 
authorized, subject to the conditions and restrictions of this 
chapter and of the rules and regulations made thereunder, upon 
application as hereinafter provided, to grant to corporations 
the privilege of establishing, operating, and maintaining 
foreign-trade zones in or adjacent to ports of entry under the 
jurisdiction of the United States.
    (b) Number of Zones Per Port of Entry.--Each port of entry 
shall be entitled to at least one zone, but when a port of 
entry is located within the confines of more than one State 
such port of entry shall be entitled to a zone in each of such 
States, and when two cities separated by water are embraced in 
one port of entry, a zone may be authorized in each of said 
cities or in territory adjacent thereto. Zones in addition to 
those to which a port of entry is entitled shall be authorized 
only if the Board finds that existing or authorized zones will 
not adequately serve the convenience of commerce.
    (c) Preference to Public Corporation.--In granting 
applications preference shall be given to public corporations.
    (d) Ownership of Harbor Facilities by State.--In case of 
any State in which harbor facilities of any port of entry are 
owned and controlled by the State and in which State harbor 
facilities of any other port of entry are owned and controlled 
by a municipality, the Board shall not grant an application by 
any public corporation for the establishment of any zone in 
such State, unless such application has been authorized by an 
Act of the legislature of such State (enacted after June 18, 
1934).

SEC. 3. ADMISSION OF FOREIGN MERCHANDISE; TREATMENT; SHIPMENT TO 
                    CUSTOMS TERRITORY; APPRAISAL; RESHIPMENT TO ZONE.

    (a) Foreign and domestic merchandise of every description, 
except such as is prohibited by law, may, without being subject 
to the customs laws of the United States, except as otherwise 
provided in this chapter, be brought into a zone and may be 
stored, sold, exhibited, broken up, repacked, assembled, 
distributed, sorted, graded, cleaned, mixed with foreign or 
domestic merchandise, or otherwise manipulated, or be 
manufactured except as otherwise provided in this chapter, and 
be exported, destroyed, or sent into customs territory of the 
United States therefrom, in the original package or otherwise; 
but when foreign merchandise is so sent from a zone into 
customs territory of the United States it shall be subject to 
the laws and regulations of the United States affecting 
imported merchandise: Provided, That whenever the privilege 
shall be requested and there has been no manipulation or 
manufacture effecting a change in tariff classification, the 
appropriate customs officer shall take under supervision any 
lot or part of a lot of foreign merchandise in a zone, cause it 
to be appraised and taxes determined and duties liquidated 
thereon. Merchandise so taken under supervision may be stored, 
manipulated, or manufactured under the supervision and 
regulations prescribed by the Secretary of the Treasury, and 
whether mixed or manufactured with domestic merchandise or not 
may, under regulations prescribed by the Secretary of the 
Treasury, be exported or destroyed, or may be sent into customs 
territory upon the payment of such liquidated duties and 
determined taxes thereon. If merchandise so taken under 
supervision has been manipulated or manufactured, such duties 
and taxes shall be payable on the quantity of such foreign 
merchandise used in the manipulation or manufacture of the 
entered article. Allowance shall be made for recoverable and 
irrecoverable waste; and if recoverable waste is sent into 
customs territory, it shall be dutiable and taxable in its 
condition and quantity and at its weight at the time of entry. 
Where two or more products result from the manipulation or 
manufacture of merchandise in a zone the liquidated duties and 
determined taxes shall be distributed to the several products 
in accordance with their relative value at the time of 
separation with due allowance for waste as provided for above: 
Provided further, That subject to such regulations respecting 
identity and the safeguarding of the revenue as the Secretary 
of the Treasury may deem necessary, articles, the growth, 
product, or manufacture of the United States, on which all 
internal-revenue taxes have been paid, if subject thereto, and 
articles previously imported on which duty and/or tax has been 
paid, or which have been admitted free of duty and tax, may be 
taken into a zone from the customs territory of the United 
States, placed under the supervision of the appropriate customs 
officer, and whether or not they have been combined with or 
made part, while in such zone, of other articles, may be 
brought back thereto free of quotas, duty, or tax: Provided 
further, That if in the opinion of the Secretary of the 
Treasury their identity has been lost, such articles not 
entitled to free entry by reason of noncompliance with the 
requirements made hereunder by the Secretary of the Treasury 
shall be treated when they reenter customs territory of the 
United States as foreign merchandise under the provisions of 
the tariff and internal-revenue laws in force at that time: 
Provided further, That under the rules and regulations of the 
controlling Federal agencies, articles which have been taken 
into a zone from customs territory for the sole purpose of 
exportation, destruction (except destruction of distilled 
spirits, wines, and fermented malt liquors), or storage shall 
be considered to be exported for the purpose of--
          (1) the draw-back, warehousing, and bonding, or any 
        other provisions of the Tariff Act of 1930, as amended, 
        and the regulations thereunder; and
          (2) the statutes and bonds exacted for the payment of 
        drawback, refund, or exemption from liability for 
        internal-revenue taxes and for the purposes of the 
        internal-revenue laws generally and the regulations 
        thereunder.
Such a transfer may also be considered an exportation for the 
purposes of other Federal laws insofar as Federal agencies 
charged with the enforcement of those laws deem it advisable. 
Such articles may not be returned to customs territory for 
domestic consumption except where the Foreign-Trade Zones Board 
deems such return to be in the public interest, in which event 
the articles shall be subject to the provisions of paragraph 
1615(f) of section 1201 of this title: Provided further, That 
no operation involving any foreign or domestic merchandise 
brought into a zone which operation would be subject to any 
provision or provisions of section 1807, chapter 15, chapter 
16, chapter 17, chapter 21, chapter 23, chapter 24 chapter 25, 
chapter 26, or chapter 32 of the Internal Revenue Code if 
performed in customs territory, or involving the manufacture of 
any article provided for in paragraphs 367 or 368 of section 
1001 of this title, shall be permitted in a zone except those 
operations (other than rectification of distilled spirits and 
wines, or the manufacture or production of alcoholic products 
unfit for beverage purposes) which were permissible under this 
chapter prior to July 1, 1949: Provided further, That articles 
produced or manufactured in a zone and exported therefrom shall 
on subsequent importation into the customs territory of the 
United States be subject to the import laws applicable to like 
articles manufactured in a foreign country, except that 
articles produced or manufactured in a zone exclusively with 
the use of domestic merchandise the identity of which has been 
maintained in accordance with the second proviso of this 
section may, on such importation, be entered as American goods 
returned: Provided, further, That no merchandise that consists 
of goods subject to NAFTA drawback, as defined in section 
203(a) of the North American Free Trade Agreement 
Implementation Act, that is manufactured or otherwise changed 
in condition shall be exported to a NAFTA country, as defined 
in section 2(4) of that Act, without an assessment of a duty on 
the merchandise in its condition and quantity, and at its 
weight, at the time of its exportation (or if the privilege in 
the first proviso to this subsection was requested, an 
assessment of a duty on the merchandise in its condition and 
quantity, and at its weight, at the time of its admission into 
the zone) and the payment of the assessed duty before the 61st 
day, after the date of exportation of the article, except that 
upon the presentation, before such 61st day, of satisfactory 
evidence of the amount of any customs duties paid or owed to 
the NAFTA country on the article, the customs duty may be 
waived or reduced (subject to section 508(b)(2)(B) of the 
Tariff Act of 1930) in an amount that does not exceed the 
lesser of (1) the total amount of customs duties paid or owed 
on the merchandise on importation into the United States, or 
(2) the total amount of customs duties paid on the article to 
the NAFTA country: Provided, further, That, if Canada ceases to 
be a NAFTA country and the suspension of the operation of the 
United States-Canada Free Trade Agreement thereafter 
terminates, with the exception of drawback eligible goods under 
section 204(a) of the United States-Canada Free-Trade Agreement 
Implementation Act of 1988, no article manufactured or 
otherwise changed in condition (except a change by cleaning, 
testing or repacking) shall be exported to Canada during the 
period such Agreement is in operation without the payment of a 
duty that shall be payable on the article in its condition and 
quantity, and at its weight, at the time of its exportation to 
Canada unless the privilege in the first proviso to this 
subsection was requested.
    (b) The exemption from the customs laws of the United 
States provided under subsection (a) shall not be available on 
or before December 31, 1992, to bicycle component parts unless 
such parts are reexported from the United States, whether in 
the original package, as components of a completely assembled 
bicycle, or otherwise.
    (c)(1) Notwithstanding the provisions of the fifth proviso 
of subsection (a), any article (within the meaning of section 
5002(a)(14) of the Internal Revenue Code of 1986) may be 
manufactured or produced from denatured distilled spirits which 
have been withdrawn free of tax from a distilled spirits plant 
(within the meaning of section 5002(a)(1) of the Internal 
Revenue Code of 1986), and articles thereof, in a zone.
    (2) Notwithstanding the provisions of the fifth proviso of 
subsection (a), distilled spirits which have been removed from 
a distilled spirits plant (as defined in section 5002(a)(1) of 
the Internal Revenue Code of 1986) upon payment or 
determination of tax may be used in the manufacture or 
production of medicines, medicinal preparation, food products, 
flavors, or flavoring extracts, which are unfit for beverage 
purposes, in a zone. Such products will be eligible for 
drawback under the internal revenue laws under the same 
conditions applicable to similar manufacturing or production 
operations occurring in customs territory.
    (d) In regard to the calculation of relative values in the 
operations of petroleum refineries in a foreign trade zone, the 
time of separation is defined as the entire manufacturing 
period. The price of products required for computing relative 
values shall be the average per unit value of each product for 
the manufacturing period. Definition and attribution of 
products to feedstocks for petroleum manufacturing may be 
either in accordance with Industry Standards of Potential 
Production on a Practical Operating Basis as verified and 
adopted by the Secretary of the Treasury (known as 
producibility) or such other inventory control method as 
approved by the Secretary of the Treasury that protects the 
revenue.
    (e) Production Equipment.--
          (1) In general.--Notwithstanding any other provision 
        of law, if all applicable customs laws are complied 
        with (except as otherwise provided in this subsection), 
        merchandise which is admitted into a foreign trade zone 
        for use within such zone as production equipment or as 
        parts for such equipment, shall not be subject to duty 
        until such merchandise is completely assembled, 
        installed, tested, and used in the production for which 
        it was admitted.
          (2) Admission procedures.--The person who admits the 
        merchandise described in paragraph (1) into the zone 
        shall, at the time of such admission, certify to the 
        Customs Service that the merchandise is admitted into 
        the zone pursuant to this subsection for use within the 
        zone as production equipment or as parts for such 
        equipment and that the merchandise will be entered and 
        estimated duties deposited when use of the merchandise 
        in production begins.
          (3) Entry procedures.--At the time use of the 
        merchandise in production begins, the merchandise shall 
        be entered, as provided for in section 484 of the 
        Tariff Act of 1930, and estimated duties shall be 
        deposited with the Customs Service. The merchandise 
        shall be subject to tariff classification according to 
        its character, condition, and quantity, and at the rate 
        of duty applicable, at the time use of the merchandise 
        in production begins.
          (4) Foreign trade zone.--For purposes of the 
        subsection, the term `foreign trade zone' includes a 
        subzone.

SEC. 4. CUSTOMS OFFICERS AND GUARDS.

    The Secretary of the Treasury shall assign to the zone the 
necessary customs officers and guards to protect the revenue 
and to provide for the admission of foreign merchandise into 
customs territory.

SEC. 5. VESSELS ENTERING OR LEAVING ZONE; COASTWISE TRADE.

    Vessels entering or leaving a zone shall be subject to the 
operation of all the laws of the United States, except as 
otherwise provided in this chapter, and vessels leaving a zone 
and arriving in customs territory of the United States shall be 
subject to such regulations to protect the revenue as may be 
prescribed by the Secretary of the Treasury. Nothing in this 
chapter shall be construed in any manner so as to permit 
vessels under foreign flags to carry goods or merchandise 
shipped from one foreign trade zone to another zone or port in 
the protected coastwise trade of the United States.

SEC. 6. APPLICATION FOR ESTABLISHMENT OF ZONE; EXPANSION OF ZONE.

    (a) Application for Establishment; Requirements.--Each 
application shall state in detail--
          (1) The location and qualifications of the area in 
        which it is proposed to establish a zone, showing (A) 
        the land and water or land or water area or land area 
        alone if the application is for its establishment in or 
        adjacent to an interior port; (B) the means of 
        segregation from customs territory; (C) the fitness of 
        the area for a zone; and (D) the possibilities of 
        expansion of the zone area;
          (2) The facilities and appurtenances which it is 
        proposed to provide and the preliminary plans and 
        estimate of the cost thereof, and the existing 
        facilities and appurtenances which it is proposed to 
        utilize;
          (3) The time within which the applicant proposes to 
        commence and complete the construction of the zone and 
        facilities and appurtenances;
          (4) The methods proposed to finance the undertaking;
          (5) Such other information as the Board may require.
    (b) Amendment of Application; Expansion of Zone.--The Board 
may upon its own initiative or upon request permit the 
amendment of the application. Any expansion of the area of an 
established zone shall be made and approved in the same manner 
as an original application.

SEC. 7. GRANTING OF APPLICATION.

    If the Board finds that the proposed plans and location are 
suitable for the accomplishment of the purpose of a foreign 
trade zone under this chapter, and that the facilities and 
appurtenances which it is proposed to provide are sufficient it 
shall make the grant.

SEC. 8. RULES AND REGULATIONS.

    The Board shall prescribe such rules and regulations not 
inconsistent with the provisions of this chapter or the rules 
and regulations of the Secretary of the Treasury made hereunder 
and as may be necessary to carry out this chapter.

SEC. 9. COOPERATION OF BOARD WITH OTHER AGENCIES.

    The Board shall cooperate with the State, subdivision, and 
municipality in which the zone is located in the exercise of 
their police, sanitary, and other powers in and in connection 
with the free zone. It shall also cooperate with the United 
States Customs Service, the United States Postal Service, the 
Public Health Service, the Immigration and Naturalization 
Service, and such other Federal agencies as have jurisdiction 
in ports of entry described in section 81b of this title.

SEC. 10. COOPERATION OF OTHER AGENCIES WITH BOARD.

    For the purpose of facilitating the investigations of the 
Board and its work in the granting of the privilege, in the 
establishment, operation, and maintenance of a zone, the 
President may direct the executive departments and other 
establishments of the Government to cooperate with the Board, 
and for such purpose each of the several departments and 
establishments is authorized, upon direction of the President, 
to furnish to the Board such records, papers, and information 
in their possession as may be required by him, and temporarily 
to detail to the service of the Board such officers, experts, 
or engineers as may be necessary.

SEC. 11. AGREEMENTS AS TO USE OF PROPERTY.

    If the title to or the right of user of any of the property 
to be included in a zone is in the United States, an agreement 
to use such property for zone purposes may be entered into 
between the grantee and the department or officer of the United 
States having control of the same, under such conditions 
approved by the Board and such department or officer, as may be 
agreed upon.

SEC. 12. FACILITIES TO BE PROVIDED AND MAINTAINED.

    Each grantee shall provide and maintain in connection with 
the zone--
          (1) Adequate slips, docks, wharves, warehouses, 
        loading and unloading and mooring facilities where the 
        zone is adjacent to water; or, in the case of an inland 
        zone, adequate loading, unloading, and warehouse 
        facilities;
          (2) Adequate transportation connections with the 
        surrounding territory and with all parts of the United 
        States, so arranged as to permit of proper guarding and 
        inspection for the protection of the revenue;
          (3) Adequate facilities for coal or other fuel and 
        for light and power;
          (4) Adequate water and sewer mains;
          (5) Adequate quarters and facilities for the officers 
        and employees of the United States, State, and 
        municipality whose duties may require their presence 
        within the zone;
          (6) Adequate enclosures to segregate the zone from 
        customs territory for protection of the revenue, 
        together with suitable provisions for ingress and 
        egress of persons, conveyances, vessels, and 
        merchandise;
          (7) Such other facilities as may be required by the 
        Board.

SEC. 13. PERMISSION TO OTHERS TO USE ZONE.

    The grantee may, with the approval of the Board, and under 
reasonable and uniform regulations for like conditions and 
circumstances to be prescribed by it, permit other persons, 
firms, corporations, or associations to erect such buildings 
and other structures within the zone as will meet their 
particular requirements: Provided, That such permission shall 
not constitute a vested right as against the United States nor 
interfere with the regulation of the grantee or the permittee 
by the United States, nor interfere with or complicate the 
revocation of the grant by the United States: And provided 
further, That in the event of the United States or the grantee 
desiring to acquire the property of the permittee no good will 
shall be considered as accruing from the privilege granted to 
the zone: And provided further, That such permits shall not be 
granted on terms that conflict with the public use of the zone 
as set forth in this chapter.

SEC. 14. OPERATION OF ZONE AS PUBLIC UTILITY; COST OF CUSTOMS SERVICE.

    Each zone shall be operated as a public utility, and all 
rates and charges for all services or privileges within the 
zone shall be fair and reasonable, and the grantee shall afford 
to all who may apply for the use of the zone and its facilities 
and appurtenances uniform treatment under like conditions, 
subject to such treaties or commercial conventions as are now 
in force or may hereafter be made from time to time by the 
United States with foreign governments and the cost of 
maintaining the additional customs service required under this 
chapter shall be paid by the operator of the zone.

SEC. 15. RESIDENTS OF ZONE.

    (a) Persons Allowed To Reside in Zone.--No person shall be 
allowed to reside within the zone except Federal, State, or 
municipal officers or agents whose resident presence is deemed 
necessary to the Board.
    (b) Rules and Regulations for Employees Entering and 
Leaving Zone.--The Board shall prescribe rules and regulations 
regarding employees and other persons entering and leaving the 
zone. All rules and regulations concerning the protection of 
the revenue shall be approved by the Secretary of the Treasury.
    (c) Exclusion From Zone of Goods or Process of Treatment.--
The Board may at any time order the exclusion from the zone of 
any goods or process of treatment that in its judgment is 
detrimental to the public interest, health, or safety.
    (d) Retail Trade Within Zone.--No retail trade shall be 
conducted within the zone except under permits issued by the 
grantee and approved by the Board. Such permittees shall sell 
no goods except such domestic or duty-paid or duty-free goods 
as are brought into the zone from customs territory.
    (e) Tangible personal property imported from outside the 
United States and held in a zone for the purpose of storage, 
sale, exhibition, repackaging, assembly, distribution, sorting, 
grading, cleaning, mixing, display, manufacturing, or 
processing, and tangible personal property produced in the 
United States and held in a zone for exportation, either in its 
original form or as altered by any of the above processes, 
shall be exempt from State and local ad valorem taxation.

SEC. 16. ACCOUNTS AND RECORDKEEPING.

    (a) Manner of Keeping Accounts.--The form and manner of 
keeping the accounts of each zone shall be prescribed by the 
Board.
    (b) Annual Report by Grantee.--Each grantee shall make to 
the Board annually, and at such other times as it may 
prescribe, reports on zone operations.
    (c) Report to Congress.--The Board shall make a report to 
Congress annually containing a summary of zone operations.

SEC. 17. TRANSFER OF GRANT.

    The grant shall not be sold, conveyed, transferred, set 
over, or assigned.

SEC. 18. REVOCATION OF GRANTS.

    (a) Procedure for Revocation.--In the event of repeated 
willful violations of any of the provisions of this chapter by 
the grantee, the Board may revoke the grant after four months 
notice to the grantee and affording it an opportunity to be 
heard. The testimony taken before the Board shall be reduced to 
writing and filed in the records of the Board together with the 
decision reached thereon.
    (b) Attendance of Witnesses and Production of Evidence.--In 
the conduct of any proceeding under this section for the 
revocation of a grant the Board may compel the attendance of 
witnesses and the giving of testimony and the production of 
documentary evidence, and for such purpose may invoke the aid 
of the district courts of the United States.
    (c) Nature of Order of Revocation; Appeal.--An order under 
the provisions of this section revoking the grant issued by the 
Board shall be final and conclusive, unless within ninety days 
after its service the grantee appeals to the court of appeals 
for the circuit in which the zone is located by filing with the 
clerk of said court a written petition praying that the order 
of the Board be set aside. Such order shall be stayed pending 
the disposition of appellate proceedings by the court. The 
clerk of the court in which such a petition is filed shall 
immediately cause a copy thereof to be delivered to the Board 
and it shall thereupon file in the court the record in the 
proceedings held before it under this section, as provided in 
section 2112 of title 28. The testimony and evidence taken or 
submitted before the Board, duly certified and filed as a part 
of the record, shall be considered by the court as the evidence 
in the case.

SEC. 19. OFFENSES.

    In case of a violation of this chapter, or any regulation 
under this chapter, by the grantee, any officer, agent or 
employee thereof responsible for or permitting any such 
violation shall be subject to a fine of not more than $1,000. 
Each day during which a violation continues shall constitute a 
separate offense.

SEC. 20. SEPARABILITY OF PROVISIONS.

    If any provision of this chapter or the application of such 
provision to certain circumstances be held invalid, the 
remainder of this chapter and the application of such 
provisions to circumstances other than those as to which it is 
held invalid shall not be affected thereby.

SEC. 21. RIGHT TO ALTER, AMEND, OR REPEAL CHAPTER.

    The right to alter, amend, or repeal this chapter is 
reserved.

   K. IMPLEMENTATION OF THE GATT AGREEMENT ON TRADE IN CIVIL AIRCRAFT


              Title VI of the Trade Agreements Act of 1979


              [19 U.S.C. 1202, 19 U.S.C. 2135; P.L. 96-39]

SEC. 601. CIVIL AIRCRAFT AND PARTS.

    (a) General.--When the conditions under section 2(b) of 
this Act on acceptance of the Agreement on Trade in Civil 
Aircraft are fulfilled, the President may proclaim after 
September 30, 1979, the changes provided for under the 
following amendments:
          (1) The headnotes to schedule 6, part 6, subpart C of 
        the Tariff Schedules of the United States are amended 
        by inserting the following new headnote:
          ``3. Certified for Use in Civil Aircraft.
          ``(a) Whenever the term `certified for use in civil 
        aircraft' is used in an item description in the 
        schedules, the importer shall file a written statement, 
        accompanied by such supporting documentation as the 
        Secretary of the Treasury may require, with the 
        appropriate customs officer stating that the imported 
        article has been imported for use in civil aircraft, 
        that it will be so used, and that the article has been 
        approved for such use by the Administrator of the 
        Federal Aviation Administration (FAA) or by the 
        airworthiness authority in the country of exportation, 
        if such approval is recognized by the FAA as an 
        acceptable substitute for FAA certification, or that an 
        application for approval for such use has been 
        submitted to, and accepted by, the Administrator of the 
        FAA.
          ``(b) For purposes of the schedules, the term `civil 
        aircraft' means all aircraft other than aircraft 
        purchased for use by the Department of Defense or the 
        United States Coast Guard.''.
          (2) A duty rate of ``Free'' in rate column numbered 1 
        of the Tariff Schedules of the United States for those 
        articles classified in the following items which the 
        President determines would provide coverage comparable 
        to that provided by foreign countries in the Annex to 
        the Agreement on Trade in Civil Aircraft if such 
        articles are certified for use in civil aircraft in 
        accordance with headnote 3 to schedule 6, part 6, 
        subpart C of the Tariff Schedules of the United States:

    518.51                         661.35                   684.50
    544.41                         661.90                   684.70
    642.20                         661.95                   685.24
    647.03                         662.50                   685.29
    647.05                         664.10                   685.40
    652.09                         676.15                   685.60
    653.39                         676.30                   685.70
    653.94                         678.50                   686.22
    660.44                         680.47                   686.24
    660.46                         680.50                   686.60
    660.52                         680.55                   688.12
    660.54                         680.56                   688.40
    660.85                         682.07                   694.15
    660.97                         682.40                   694.20
    661.10                         682.60                   694.40
    661.12                         683.60                   694.60
    661.15                         684.30                   709.45
    661.20                         684.40                   710.08
    710.14                         711.84                   727.47
    710.16                         711.98                   727.48
    710.30                         712.05                   727.55
    710.46                         712.47                   745.45
    711.36                         712.49                   772.45
    711.37                         715.15                   772.65.
    711.82                         720.08
    
          (3) Section 466 of the Tariff Act of 1930 (19 U.S.C. 
        1466) is amended by adding at the end thereof the 
        following new subsection:
          ``(f) The duty imposed under subsection (a) shall not 
        apply to the cost of repair parts, materials, or 
        expenses of repairs in a foreign country upon a United 
        States civil aircraft, within the meaning of headnote 3 
        to schedule 6, part 6, subpart C of the Tariff 
        Schedules of the United States.''.
    (b) Termination and Withdrawal.--For purposes of section 
125 of the Trade Act of 1974, the amendments made under 
subsection (a), if any, shall be considered to be trade 
agreement obligations entered into under the Trade Act of 1974 
of benefit to foreign countries or instrumentalities.

            Section 234 of the Trade and Tariff Act of 1984


             [19 U.S.C. 1202, 19 U.S.C. 2135; P.L. 98-573]

SEC. 234. MODIFICATION OF DUTIES ON CERTAIN ARTICLES USED IN CIVIL 
                    AVIATION.

    (a) The President may proclaim modifications in the rate of 
duty column numbered 1 and in the article descriptions, 
including the superior headings thereto, for the articles 
provided for in the following items in the Tariff Schedules of 
the United States (19 U.S.C. 1202) in order to provide duty-
free coverage comparable to the expanded coverage provided by 
all other signatories to the Agreement on Trade in Civil 
Aircraft pursuant to the extension of the Annex to the 
Agreement on Trade in Civil Aircraft on October 6, 1983, and 
recorded in the decision of the Committee on March 22, 1984, if 
such articles are certified for use in civil aircraft in 
accordance with headnote 3 to schedule 6, part 6, subpart C of 
such Schedules:

    646.95                         680.95                   708.05
    660.85                         681.01                   708.07
    660.97                         681.15                   708.09
    661.06                         681.18                   708.21
    661.10                         681.21                   708.23
    661.15                         681.24                   708.25
    661.20                         682.05                   708.27
    661.35                         683.05                   708.29
    680.59                         683.07                   711.77
    680.61                         683.15                   711.78
    680.62                         708.01                   711.98
    680.92                         708.03                   711.49

    (b) For purposes of section 125 of the Trade Act of 1974, 
the duty-free treatment, if any, proclaimed under subsection 
(a) shall be considered to be trade agreement obligations 
entered into under the Trade Act of 1974 of benefit to foreign 
countries or instrumentalities.

            General Note 6 of the Harmonized Tariff Schedule


Articles Eligible for Duty-Free Treatment Pursuant to the Agreement on 
        Trade in Civil Aircraft

  (a) Whenever a product is entered under a provision for which 
the rate of duty ``Free (C)'' appears in the ``Special'' 
subcolumn and a claim for such rate of duty is made, the 
importer--
           (i) shall maintain such supporting documentation as 
        the Secretary of the Treasury may require; and
           (ii) shall be deemed to certify that the imported 
        article is a civil aircraft, or has been imported for 
        use in a civil aircraft and will be so used.
        The importer may amend the entry or file a written 
        statement to claim a free rate of duty under this note 
        at any time before the liquidation of the entry becomes 
        final, except that, notwithstanding section 505(c) of 
        the Tariff Act of 1930 (19 U.S.C. 1505(c)), any refund 
        resulting from any such claim shall be without 
        interest.
   (b)(i) For purposes of the tariff schedule, the term ``civil 
aircraft'' means any aircraft, aircraft engine, or ground 
flight simulator (including parts, components, and 
subassemblies thereof)--
                   (A) that is used as original or replacement 
                equipment in the design, development, testing, 
                evaluation, manufacture, repair, maintenance, 
                rebuilding, modification, or conversion of 
                aircraft; and
                   (B)(1) that is manufactured or operated 
                pursuant to a certificate issued by the 
                Administrator of the Federal Aviation 
                Administration (hereafter referred to as the 
                ``FAA'') under section 44704 of title 49, 
                United States Code, or pursuant to the approval 
                of the airworthiness authority in the country 
                of exportation, if such approval is recognized 
                by the FAA as an acceptable substitute for such 
                an FAA certificate;
                   (2) for which an application for such 
                certificate has been submitted to, and accepted 
                by, the Administrator of the FAA by an existing 
                type and production certificate holder pursuant 
                to section 44702 of title 49, United States 
                Code, and regulations promulgated thereunder; 
                or
                   (3) for which an application for such 
                approval or certificate will be submitted in 
                the future by an existing type and production 
                certificate holder, pending the completion of 
                design or other technical requirements 
                stipulated by the Administrator of the FAA.
           (ii) The term ``civil aircraft'' does not include 
        any aircraft, aircraft engine, or ground flight 
        simulator (or parts, components, and subassemblies 
        thereof) purchased for use by the Department of Defense 
        or the United States Coast Guard, unless such aircraft, 
        aircraft engine, or ground flight simulator (or parts, 
        components, and subassemblies thereof) satisfies the 
        requirements of subdivisions (i)(A) and (i)(B)(1) or 
        (2).
           (iii) Subdivision (i)(B)(3) shall apply only to such 
        quantities of the parts, components, and subassemblies 
        as are required to meet the design and technical 
        requirements stipulated by the Administrator. The 
        Commissioner of Customs may require the importer to 
        estimate the quantities of parts, components, and 
        subassemblies covered for purposes of such subdivision.


                      Chapter 9: TRADE REMEDY LAWS

   A. AUTHORITIES TO RESPOND TO FOREIGN SUBSIDY AND DUMPING PRACTICES

                        1. Countervailing Duties

           Section 753 of the Tariff Act of 1930, as amended

[19 U.S.C. 1675b; P.L. 71-361, as amended by P.L. 103-465 and P.L. 104-
                                  295]

SEC. 753. SPECIAL RULES FOR INJURY INVESTIGATIONS FOR CERTAIN SECTION 
                    303 OR SECTION 701(C) COUNTERVAILING DUTY ORDERS 
                    AND INVESTIGATIONS.

  (a) In General.--
          (1) Investigation by the commission upon request.--In 
        the case of a countervailing duty order described in 
        paragraph (2), which--
                  (A) applies to merchandise that is the 
                product of a Subsidies Agreement country, and
                  (B)(i) is in effect on the date on which such 
                country becomes a Subsidies Agreement country, 
                or
                  (ii) is issued on a date that is after the 
                date described in clause (i) pursuant to a 
                court order in an action brought under section 
                516A,
        the Commission, upon receipt of a request from an 
        interested party described in section 771(9) (C), (D), 
        (E), (F), or (G) for an injury investigation with 
        respect to such order, shall initiate an investigation 
        and shall determine whether an industry in the United 
        States is likely to be materially injured by reason of 
        imports of the subject merchandise if the order is 
        revoked.
          (2) Description of countervailing duty orders.--A 
        countervailing duty order described in this paragraph 
        is an order issued under section 303 or section 701(c) 
        with respect to which the requirement of an affirmative 
        determination of material injury was not applicable at 
        the time such order was issued.
          (3) Requirements of request for investigation.--A 
        request for an investigation under this subsection 
        shall be submitted--
                  (A) in the case of an order described in 
                paragraph (1)(B)(i), within 6 months after the 
                date on which the country described in 
                paragraph (1)(A) becomes a Subsidies Agreement 
                country, or
                  (B) in the case of an order described in 
                paragraph (1)(B)(ii), within 6 months after the 
                date the order is issued.
          (4) Suspension of liquidation.--With respect to 
        entries of subject merchandise made on or after--
                  (A) in the case of an order described in 
                paragraph (1)(B)(i), the date on which the 
                country described in paragraph (1)(A) becomes a 
                Subsidies Agreement country, or
                  (B) in the case of an order described in 
                paragraph (1)(B)(ii), the date on which the 
                order is issued,
        liquidation shall be suspended at the cash deposit rate 
        in effect on the date described in subparagraph (A) or 
        (B) (whichever is applicable).
  (b) Investigation Procedure and Schedule.--
          (1) Commission procedure.--
                  (A) In general.--Except as otherwise provided 
                in this section, the provisions of this title 
                regarding evidence in and procedures for 
                investigations conducted under subtitle A shall 
                apply to investigations conducted by the 
                Commission under this section.
                  (B) Time for commission determination.--
                Except as otherwise provided in subparagraph 
                (C), the Commission shall issue its 
                determination under subsection (a)(1), to the 
                extent possible, not later than 1 year after 
                the date on which the investigation is 
                initiated under this section.
                  (C) Special rule to permit administrative 
                flexibility.--In the case of requests for 
                investigations received under this section 
                within 1 year after the date on which the WTO 
                Agreement enters into force with respect to the 
                United States, the Commission may, after 
                consulting with the administering authority, 
                initiate its investigations in a manner that 
                results in determinations being made in all 
                such investigations during the 4-year period 
                beginning on such date.
          (2) Net countervailable subsidy; nature of subsidy.--
                  (A) Net countervailable subsidy.--The 
                administering authority shall provide to the 
                Commission the net countervailable subsidy that 
                is likely to prevail if the order which is the 
                subject of the investigation is revoked. The 
                administering authority normally shall choose a 
                net countervailable subsidy that was determined 
                under section 705 or subsection (a) or (b)(1) 
                of section 751. If the Commission considers the 
                magnitude of the net countervailable subsidy in 
                making its determination under this section, 
                the Commission shall use the net 
                countervailable subsidy provided by the 
                administering authority.
                  (B) Nature of subsidy.--The administering 
                authority shall inform the Commission of, and 
                the Commission, in making its determination 
                under this section, shall consider, the nature 
                of the countervailable subsidy and whether the 
                countervailable subsidy is a subsidy described 
                in Article 3 or Article 6.1 of the Subsidies 
                Agreement.\1\
---------------------------------------------------------------------------
    \1\ Article 6.1 of the Uruguay Round Subsidies Agreement lapsed on 
January 1, 2000.
---------------------------------------------------------------------------
          (3) Effect of commission determination.--
                  (A) Affirmative determination.--Upon being 
                notified by the Commission that it has made an 
                affirmative determination under subsection 
                (a)(1)--
                          (i) the administering authority shall 
                        order the termination of the suspension 
                        of liquidation required pursuant to 
                        subsection (a)(4), and
                          (ii) the countervailing duty order 
                        shall remain in effect until revoked, 
                        in whole or in part, under section 
                        751(d).
        For purposes of section 751(c), a countervailing duty 
        order described in this section shall be treated as 
        issued on the date of publication of the Commission's 
        determination under this subsection.
                  (B) Negative determination.--
                          (i) In general.--Upon being notified 
                        by the Commission that it has made a 
                        negative determination under subsection 
                        (a)(1), the administering authority 
                        shall revoke the countervailing duty 
                        order, and shall refund, with interest, 
                        any estimated countervailing duties 
                        collected during the period liquidation 
                        was suspended pursuant to subsection 
                        (a)(4).
                          (ii) Limitation on negative 
                        determination.--A determination by the 
                        Commission that revocation of the order 
                        is not likely to result in material 
                        injury to an industry by reason of 
                        imports of the subject merchandise 
                        shall not be based, in whole or in 
                        part, on any export taxes, duties, or 
                        other charges levied on the export of 
                        the subject merchandise to the United 
                        States that were specifically intended 
                        to offset the countervailable subsidy 
                        received.
          (4) Countervailing duty orders with respect to which 
        no request for injury investigation is made.--If, with 
        respect to a countervailing duty order described in 
        subsection (a), a request for an investigation is not 
        made within the time required by subsection (a)(3), the 
        Commission shall notify the administering authority 
        that a negative determination has been made under 
        subsection (a) and the provisions of paragraph (3)(B) 
        shall apply with respect to the order.
  (c) Pending and Suspended Countervailing Duty 
Investigations.--If, on the date on which a country becomes a 
Subsidies Agreement country, there is a countervailing duty 
investigation in progress or suspended under section 303 or 
section 701(c) that applies to merchandise which is a product 
of that country and with respect to which the requirement of an 
affirmative determination of material injury was not applicable 
at the time the investigation was initiated, the Commission 
shall--
          (1) in the case of an investigation in progress, make 
        a final determination under section 705(b) within 75 
        days after the date of an affirmative final 
        determination, if any, by the administering authority,
          (2) in the case of a suspended investigation to which 
        section 704(i)(1)(B) applies, make a final 
        determination under section 705(b) within 120 days 
        after receiving notice from the administering authority 
        of the resumption of the investigation pursuant to 
        section 704(i), or within 45 days after the date of an 
        affirmative final determination, if any, by the 
        administering authority, whichever is later, or
          (3) in the case of a suspended investigation to which 
        section 704(i)(1)(C) applies, treat the countervailing 
        duty order issued pursuant to such section as if it 
        were--
                  (A) an order issued under subsection 
                (a)(1)(B)(ii) for purposes of subsection 
                (a)(3); and
                  (B) an order issued under subsection 
                (a)(1)(B)(i) for purposes of subsection (a)(4).
  (d) Publication in Federal Register.--The administering 
authority or the Commission, as the case may be, shall publish 
in the Federal Register a notice of the initiation of any 
investigation, and a notice of any determination or revocation, 
made pursuant to this section.
  (e) Request for Simultaneous Expedited Review Under Section 
751(c).--
          (1) General rule.--
                  (A) Requests for reviews.--Notwithstanding 
                section 751(c)(6)(A) and except as provided in 
                subparagraph (B), an interested party may 
                request a review of an order under section 
                751(c) at the same time the party requests an 
                investigation under subsection (a), if the 
                order involves the same or comparable subject 
                merchandise. Upon receipt of such request, the 
                administering authority, after consulting with 
                the Commission, shall initiate a review of the 
                order under section 751(c). The Commission 
                shall combine such review with the 
                investigation under this section.
                  (B) Exception.--If the administering 
                authority determines that the interested party 
                who requested an investigation under this 
                section is a related party or an importer 
                within the meaning of section 771(4)(B), the 
                administering authority may decline a request 
                by such party to initiate a review of an order 
                under section 751(c) which involves the same or 
                comparable subject merchandise.
          (2) Cumulation.--If a review under section 751(c) is 
        initiated under paragraph (1), such review shall be 
        treated as having been initiated on the same day as the 
        investigation under this section, and the Commission 
        may, in accordance with section 771(7)(G), cumulatively 
        assess the volume and effect of imports of the subject 
        merchandise from all countries with respect to which 
        such investigations are treated as initiated on the 
        same day.
          (3)  Time and procedure for commission 
        determination.--The Commission shall render its 
        determination in the investigation conducted under this 
        section at the same time as the Commission's 
        determination is made in the review under section 
        751(c) that is initiated pursuant to this subsection. 
        The Commission shall in all other respects apply the 
        procedures and standards set forth in section 751(c) to 
        such section 751(c) reviews.

        Section 261 (a)-(c) of the Uruguay Round Agreements Act


                     [19 U.S.C. 1303; P.L. 103-465]

SEC. 261. REPEAL OF SECTION 303.

    (a) In General.--Section 303 of the Tariff Act of 1930 (19 
U.S.C. 1303) is repealed effective on the effective date of 
this title.
    (b) Savings Provisions.--
          (1) Continuing effect of legal documents.--All 
        orders, determinations, and other administrative 
        actions--
                  (A) which have been issued pursuant to an 
                investigation conducted under section 303 of 
                the Tariff Act of 1930, and
                  (B) which are in effect on the effective date 
                of this title, or were final before such date 
                and are to become effective on or after such 
                date,
        shall continue in effect according to their terms until 
        modified, terminated, superseded, set aside, or revoked 
        in accordance with law by the administering authority, 
        the International Trade Commission, or a court of 
        competent jurisdiction, or by operation of law. Except 
        as provided in paragraph (3), such orders or 
        determinations shall be subject to review under section 
        751 of the Tariff Act of 1930 and, to the extent 
        applicable, investigation under section 753 of such Act 
        (as added by this title).
          (2) Proceedings not affected.--The provisions of 
        subsection (a) shall not affect any proceedings, 
        including notices of proposed rulemaking, pending 
        before the administering authority or the International 
        Trade Commission on the effective date of this title 
        with respect to such section 303. Orders shall be 
        issued in such proceedings, appeals shall be taken 
        therefrom, and payments shall be made pursuant to such 
        orders, in accordance with such section 303 as in 
        effect on the day before the effective date of this 
        title and, except as provided in paragraph (3), shall 
        be subject to review under section 751 of the Tariff 
        Act of 1930 and, to the extent applicable, 
        investigation under section 753 of such Act. Orders 
        issued in any such proceedings shall continue in effect 
        until modified, terminated, superseded, set aside, or 
        revoked in accordance with law by the administering 
        authority, a court of competent jurisdiction, or by 
        operation of law. Nothing in this section shall be 
        deemed to prohibit the discontinuance or modification 
        of any such proceeding under the same terms and 
        conditions and to the same extent that such proceeding 
        could have been discontinued or modified if this 
        section had not been enacted.
          (3) Suits not affected.--The provisions of subsection 
        (a) shall not affect the review pursuant to section 
        516A of the Tariff Act of 1930 of a countervailing duty 
        order issued pursuant to an investigation conducted 
        under section 303 of such Act or a review of a 
        countervailing duty order issued under section 751 of 
        such Act, if such review is pending or the time for 
        filing such review has not expired on the effective 
        date of this title.
    (c) Definition of Administering Authority.--For purposes of 
this section, the term ``administering authority'' has the 
meaning given such term by section 771(1) of the Tariff Act of 
1930.

 Subtitle A of Title VII (Sections 701-709) of the Tariff Act of 1930, 
                               as amended


 [19 U.S.C. 1671-1671h; P.L. 71-361, as amended by P.L. 96-39, P.L. 98-
  181, P.L. 98-573, P.L. 99-514, P.L. 100-418, P.L. 100-647, P.L. 103-
                         465, and P.L. 104-295]

SEC. 701. COUNTERVAILING DUTIES IMPOSED.

  (a) General Rule.--If--
          (1) the administering authority determines that the 
        government of a country or any public entity within the 
        territory of a country is providing, directly or 
        indirectly, a countervailable subsidy with respect to 
        the manufacture, production, or export of a class or 
        kind of merchandise imported, or sold (or likely to be 
        sold) for importation, into the United States, and
          (2) in the case of merchandise imported from a 
        Subsidies Agreement country, the Commission determines 
        that--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports of that merchandise or by reason 
        of sales (or the likelihood of sales) of that 
        merchandise for importation,
then there shall be imposed upon such merchandise a 
countervailing duty, in addition to any other duty imposed, 
equal to the amount of the net countervailable subsidy. For 
purposes of this subsection and section 705(b)(1), a reference 
to the sale of merchandise includes the entering into of any 
leasing arrangement regarding the merchandise that is 
equivalent to the sale of the merchandise.
  (b) Subsidies Agreement Country.--For purposes of this title, 
the term ``Subsidies Agreement country'' means--
          (1) a WTO member country,
          (2) a country which the President has determined has 
        assumed obligations with respect to the United States 
        which are substantially equivalent to the obligations 
        under the Subsidies Agreement, or
          (3) a country with respect to which the President 
        determines that--
                  (A) there is an agreement in effect between 
                the United States and that country which--
                          (i) was in force on the date of the 
                        enactment of the Uruguay Round 
                        Agreements Act, and
                          (ii) requires unconditional most-
                        favored-nation treatment with respect 
                        to articles imported into the United 
                        States, and
                  (B) the agreement described in subparagraph 
                (A) does not expressly permit--
                          (i) actions required or permitted by 
                        the GATT 1947 or GATT 1994, as defined 
                        in section 2(1) of the Uruguay Round 
                        Agreements Act, or required by the 
                        Congress, or
                          (ii) nondiscriminatory prohibitions 
                        or restrictions on importation which 
                        are designed to prevent deceptive or 
                        unfair practices.
  (c) Countervailing Duty Investigations Involving Imports Not 
Entitled to a Material Injury Determination.--In the case of 
any article or merchandise imported from a country which is not 
a Subsidies Agreement country--
          (1) no determination by the Commission under section 
        703(a), 704, or 705(b) shall be required,
          (2) an investigation may not be suspended under 
        section 704(c) or 704(l),
          (3) no determination as to the presence of critical 
        circumstances shall be made under section 703(e) or 
        705(a)(2),
          (4) section 706(c) shall not apply,
          (5) any reference to a determination described in 
        paragraph (1) or (3), or to the suspension of an 
        investigation under section 704(c) or 704(l), shall be 
        disregarded, and
          (6) section 751(c) shall not apply.
  (d) Treatment of International Consortia.--For purposes of 
this subtitle, if the members (or other participating entities) 
of an international consortium that is engaged in the 
production of subject merchandise receive countervailable 
subsidies from their respective home countries to assist, 
permit, or otherwise enable their participation in that 
consortium through production or manufacturing operations in 
their respective home countries, then the administering 
authority shall cumulate all such countervailable subsidies, as 
well as countervailable subsidies provided directly to the 
international consortium, in determining any countervailing 
duty upon such merchandise.
  (e) Upstream Subsidy.--Whenever the administering authority 
has reasonable grounds to believe or suspect that an upstream 
subsidy, as defined in section 771A(a)(1), is being paid or 
bestowed, the administering authority shall investigate whether 
an upstream subsidy has in fact been paid or bestowed, and if 
so, shall include the amount of the upstream subsidy as 
provided in section 771A(a)(3).

SEC. 702. PROCEDURES FOR INITIATING A COUNTERVAILING DUTY 
                    INVESTIGATION.

  (a) Initiation by Administering Authority.--A countervailing 
duty investigation shall be initiated whenever the 
administering authority determines, from information available 
to it, that a formal investigation is warranted into the 
question of whether the elements necessary for the imposition 
of a duty under section 701(a) exist.
  (b) Initiation by Petition.--
          (1) Petition requirements.--A countervailing duty 
        proceeding shall be initiated whenever an interested 
        party described in subparagraph (C), (D), (E), (F), or 
        (G) of section 771(9) files a petition with the 
        administering authority, on behalf of an industry, 
        which alleges the elements necessary for the imposition 
        of the duty imposed by section 701(a), and which is 
        accompanied by information reasonably available to the 
        petitioner supporting those allegations. The petition 
        may be amended at such time, and upon such conditions, 
        as the administering authority and the Commission may 
        permit.
          (2) Simultaneous filing with commission.--The 
        petitioner shall file a copy of the petition with the 
        Commission on the same day as it is filed with the 
        administering authority.
          (3) Petition based upon a derogation of an 
        international undertaking on official export credits.--
        If the sole basis of a petition filed under paragraph 
        (1) is the derogation of an international undertaking 
        on official export credits, the administering authority 
        shall immediately notify the Secretary of the Treasury 
        who shall, in consultation with the administering 
        authority, within 5 days after the date on which the 
        administering authority initiates an investigation 
        under subsection (c), determine the existence and 
        estimated value of the derogation, if any, and shall 
        publish such determination in the Federal Register.
          (4) Action with respect to petitions.--
                  (A) Notification of governments.--Upon 
                receipt of a petition filed under paragraph 
                (1), the administering authority shall--
                          (i) notify the government of any 
                        exporting country named in the petition 
                        by delivering a public version of the 
                        petition to an appropriate 
                        representative of such country; and
                          (ii) provide the government of any 
                        exporting country named in the petition 
                        that is a Subsidies Agreement country 
                        an opportunity for consultations with 
                        respect to the petition.
                  (B) Acceptance of communications.--The 
                administering authority shall not accept any 
                unsolicited oral or written communication from 
                any person other than an interested party 
                described in section 771(9) (C), (D), (E), (F), 
                or (G) before the administering authority makes 
                its decision whether to initiate an 
                investigation, except as provided in 
                subparagraph (A)(ii) and subsection (c)(4)(D), 
                and except for inquiries regarding the status 
                of the administering authority's consideration 
                of the petition.
                  (C) Nondisclosure of certain information.--
                The administering authority and the Commission 
                shall not dis-close information with regard to 
                any draft petition sub-mitted for review and 
                comment before it is filed under paragraph (1).
  (c) Petition Determination.--
          (1) In general.--
                  (A) Time for initial determination.--Except 
                as provided in subparagraph (B), within 20 days 
                after the date on which a petition is filed 
                under subsection (b), the administering 
                authority shall--
                          (i) after examining, on the basis of 
                        sources readily available to the 
                        administering authority, the accuracy 
                        and adequacy of the evidence provided 
                        in the petition, determine whether the 
                        petition alleges the elements necessary 
                        for the imposition of a duty under 
                        section 701(a) and contains information 
                        reasonably available to the petitioner 
                        supporting the allegations, and
                          (ii) determine if the petition has 
                        been filed by or on behalf of the 
                        industry.
                  (B) Extension of time.--In any case in which 
                the administering authority is required to poll 
                or otherwise determine support for the petition 
                by the industry under paragraph (4)(D), the 
                administering authority may, in exceptional 
                circumstances, apply subparagraph (A) by 
                substituting ``a maximum of 40 days'' for ``20 
                days''.
                  (C) Time limits where petition involves same 
                merchandise as an order that has been 
                revoked.--If a petition is filed under this 
                section with respect to merchandise that was 
                the subject merchandise of--
                          (i) a countervailing duty order that 
                        was revoked under section 751(d) in the 
                        24 months preceding the date the 
                        petition is filed, or
                          (ii) a suspended investigation that 
                        was terminated under section 751(d) in 
                        the 24 months preceding the date the 
                        petition is filed,
                the administering authority and the Commission 
                shall, to the maximum extent practicable, 
                expedite any investigation initiated under this 
                section with respect to the petition.
          (2) Affirmative determinations.--If the 
        determinations under clauses (i) and (ii) of paragraph 
        (1)(A) are affirmative, the administering authority 
        shall initiate an investigation to determine whether a 
        countervailable subsidy is being provided with respect 
        to the subject merchandise.
          (3) Negative determinations.--If the determination 
        under clause (i) or (ii) of paragraph (1)(A) is 
        negative, the administering authority shall dismiss the 
        petition, terminate the proceeding, and notify the 
        petitioner in writing of the reasons for the 
        determination.
          (4) Determination of industry support.--
                  (A) General rule.--For purposes of this 
                subsection, the administering authority shall 
                determine that the petition has been filed by 
                or on behalf of the industry, if--
                          (i) the domestic producers or workers 
                        who support the petition account for at 
                        least 25 percent of the total 
                        production of the domestic like 
                        product, and
                          (ii) the domestic producers or 
                        workers who support the petition 
                        account for more than 50 percent of the 
                        production of the domestic like product 
                        produced by that portion of the 
                        industry expressing support for or 
                        opposition to the petition.
                  (B)  Certain positions disregarded.--
                          (i) Producers related to foreign 
                        producers.--In determining industry 
                        support under subparagraph (A), the 
                        administering authority shall disregard 
                        the position of domestic producers who 
                        oppose the petition, if such producers 
                        are related to foreign producers, as 
                        defined in section 771(4)(B)(ii), 
                        unless such domestic producers 
                        demonstrate that their interests as 
                        domestic producers would be adversely 
                        affected by the imposition of a 
                        countervailing duty order.
                          (ii) Producers who are importers.--
                        The administering authority may 
                        disregard the position of domestic 
                        producers of a domestic like product 
                        who are importers of the subject 
                        merchandise.
                  (C) Special rule for regional industries.--If 
                the petition alleges that the industry is a 
                regional industry, the administering authority 
                shall determine whether the petition has been 
                filed by or on behalf of the industry by 
                applying subparagraph (A) on the basis of 
                production in the region.
                  (D) Polling the industry.--If the petition 
                does not establish support of domestic 
                producers or workers accounting for more than 
                50 percent of the total production of the 
                domestic like product, the administering 
                authority shall--
                          (i) poll the industry or rely on 
                        other information in order to determine 
                        if there is support for the petition as 
                        required by subparagraph (A), or
                          (ii) if there is a large number of 
                        producers in the industry, the 
                        administering authority may determine 
                        industry support for the petition by 
                        using any statistically valid sampling 
                        method to poll the industry.
                  (E) Comments by interested parties.--Before 
                the administering authority makes a 
                determination with respect to initiating an 
                investigation, any person who would qualify as 
                an interested party under section 771(9) if an 
                investigation were initiated, may submit 
                comments or information on the issue of 
                industry support. After the administering 
                authority makes a determination with respect to 
                initiating an investigation, the determination 
                regarding industry support shall not be 
                reconsidered.
          (5) Definition of domestic producers or workers.--For 
        purposes of this subsection, the term ``domestic 
        producers or workers'' means those interested parties 
        who are eligible to file a petition under subsection 
        (b)(1).
  (d) Notification to Commission of Determination.--The 
administering authority shall--
          (1) notify the Commission immediately of any 
        determination it makes under subsection (a) or (c), and
          (2) if the determination is affirmative, make 
        available to the Commission such information as it may 
        have relating to the matter under investigation, under 
        such procedures as the administering authority and the 
        Commission may establish to prevent disclosure, other 
        than with the consent of the party providing it or 
        under protective order, of any information to which 
        confidential treatment has been given by the 
        administering authority.
  (e) Information Regarding Critical Circumstances.--If, at any 
time after the initiation of an investigation under this 
subtitle, the administering authority finds a reasonable basis 
to suspect that the alleged countervailable subsidy is 
inconsistent with the Subsidies Agreement, the administering 
authority may request the Commissioner of Customs to compile 
information on an expedited basis regarding entries of the 
subject merchandise. Upon receiving such request, the 
Commissioner of Customs shall collect information regarding the 
volume and value of entries of the class or kind of merchandise 
that is the subject of the investigation and shall transmit 
such information to the administering authority at such times 
as the administering authority shall direct (at least once 
every 30 days), until a final determination is made under 
section 705(a), the investigation is terminated, or the 
administering authority withdraws the request.

SEC. 703. PRELIMINARY DETERMINATIONS.

  (a) Determination by Commission of Reasonable Indication of 
Injury.--
          (1) General rule.--Except in the case of a petition 
        dismissed by the administering authority under section 
        702(c)(3), the Commission, within the time specified in 
        paragraph (2), shall determine, based on the 
        information available to it at the time of the 
        determination, whether there is a reasonable indication 
        that--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports of the subject merchandise and 
        that imports of the subject merchandise are not 
        negligible. If the Commission finds that imports of the 
        subject merchandise are negligible or otherwise makes a 
        negative determination under this paragraph, the 
        investigation shall be terminated.
          (2) Time for commission determination.--The 
        Commission shall make the determination described in 
        paragraph (1)--
                  (A) in the case of a petition filed under 
                section 702(b)--
                          (i) within 45 days after the date on 
                        which the petition is filed, or
                          (ii) if the time has been extended 
                        pursuant to section 702(c)(1)(B), 
                        within 25 days after the date on which 
                        the Commission receives notice from the 
                        administering authority of initiation 
                        of the investigation, and
                  (B) in the case of an investigation initiated 
                under section 702(a), within 45 days after the 
                date on which the Commission receives notice 
                from the administering authority that an 
                investigation has been initiated under such 
                section.
  (b)(1) Preliminary Determination by Administering 
Authority.--Within 65 days after the date on which the 
administering authority initiates an investigation under 
section 702(c), or an investigation is initiated under section 
702(a), but not before an affirmative determination by the 
Commission under subsection (a) of this section, the 
administering authority shall make a determination, based upon 
the information available to it at the time of the 
determination, of whether there is a reasonable basis to 
believe or suspect that a countervailable subsidy is being 
provided with respect to the subject merchandise.
  (2) Notwithstanding paragraph (1), when the petition is one 
subject to section 702(b)(3), the administering authority 
shall, taking into account the nature of the countervailable 
subsidy concerned, make the determination required by paragraph 
(1) on an expedited basis and within 65 days after the date on 
which the administering authority initiates an investigation 
under section 702(c) unless the provisions of subsection (c) of 
this section apply.
  (3) Preliminary Determination Under Waiver of Verification.--
Within 55 days after the initiation of an investigation the 
administering authority shall cause an official designated for 
such purpose to review the information concerning the case 
received during the first 50 days of the investigation, and, if 
there appears to be sufficient information available upon which 
the determination can reasonably be based, to disclose to the 
petitioner and any interested party, then a party to the 
proceedings that requests such disclosure, all available 
nonconfidential information and all other information which is 
disclosed pursuant to section 777. Within 3 days (not counting 
Saturdays, Sundays, or legal public holidays) after such 
disclosure, the petitioner and each party which is an 
interested party described in subparagraph (C), (D), (E), (F), 
or (G) of section 771(9) to whom such disclosure was made may 
furnish to the administering authority an irrevocable written 
waiver of verification of the information received by the 
authority, and an agreement that it is willing to have a 
determination made on the basis of the record then available to 
the authority. If a timely waiver and agreement have been 
received from the petitioner and each party which is an 
interested party described in subparagraph (C), (D), (E), (F), 
or (G) of section 771(9) to whom the disclosure was made, and 
the authority finds that sufficient information is then 
available upon which the preliminary determination can 
reasonably be based, a preliminary determination shall be made 
on an expedited basis on the basis of the record established 
during the first 50 days after the investigation was initiated.
          (4) \2\ De minimis countervailable subsidy.--
---------------------------------------------------------------------------
    \2\ Indentation so in law.
---------------------------------------------------------------------------
                  (A) General rule.--In making a determination 
                under this subsection, the administering 
                authority shall disregard any de minimis 
                countervailable subsidy. For purposes of the 
                preceding sentence, a countervailable subsidy 
                is de minimis if the administering authority 
                determines that the aggregate of the net 
                countervailable subsidies is less than 1 
                percent ad valorem or the equivalent specific 
                rate for the subject merchandise.
                  (B) Exception for developing countries.--In 
                the case of subject merchandise imported from a 
                Subsidies Agreement country (other than a 
                country to which subparagraph (C) applies) 
                designated by the Trade Representative as a 
                developing country in accordance with section 
                771(36), a countervailable subsidy is de 
                minimis if the administering authority 
                determines that the aggregate of the net 
                countervailable subsidies does not exceed 2 
                percent ad valorem or the equivalent specific 
                rate for the subject merchandise.
                  (C) Certain other developing countries.--In 
                the case of subject merchandise imported from a 
                Subsidies Agreement country that is--
                          (i) a least developed country, as 
                        determined by the Trade Representative 
                        in accordance with section 771(36), or
                          (ii) a developing country with 
                        respect to which the Trade 
                        Representative has notified the 
                        administering authority that the 
                        country has eliminated its export 
                        subsidies on an expedited basis within 
                        the meaning of Article 27.11 of the 
                        Subsidies Agreement,
                subparagraph (B) shall be applied by 
                substituting ``3 percent'' for ``2 percent''.
                  (D) Limitations on application of 
                subparagraph (c).--
                          (i) In general.--In the case of a 
                        country described in subparagraph 
                        (C)(i), the provisions of subparagraph 
                        (C) shall not apply after the date that 
                        is 8 years after the date the WTO 
                        Agreement enters into force.
                          (ii) Special rule for subparagraph 
                        (C)(ii) countries.--In the case of a 
                        country described in subparagraph 
                        (C)(ii), the provisions of subparagraph 
                        (C) shall not apply after the earlier 
                        of--
                                  (I) the date that is 8 years 
                                after the date the WTO 
                                Agreement enters into force, or
                                  (II) the date on which the 
                                Trade Representative notifies 
                                the administering authority 
                                that such country is providing 
                                an export subsidy.
          (5) \3\ Notification of article 8 violation.--If the 
        only subsidy under investigation is a subsidy with 
        respect to which the administering authority received 
        notice from the Trade Representative of a violation of 
        Article 8 of the Subsidies Agreement, paragraph (1) 
        shall be applied by substituting ``60 days'' for ``65 
        days''.\4\
---------------------------------------------------------------------------
    \3\ Indentation so in law.
    \4\ Article 8 of the Uruguay Round Subsidies Agreement lapsed 
January 1, 2000.
---------------------------------------------------------------------------
  (c) Extension of Period in Extraordinarily Complicated 
Cases.--
          (1) In general.--If--
                  (A) the petitioner makes a timely request for 
                an extension of the period within which the 
                determination must be made under subsection 
                (b), or
                  (B) the administering authority concludes 
                that the parties concerned are cooperating and 
                determines that--
                          (i) the case is extraordinarily 
                        complicated by reason of--
                                  (I) the number and complexity 
                                of the alleged countervailable 
                                subsidy practices;
                                  (II) the novelty of the 
                                issues presented;
                                  (III) the need to determine 
                                the extent to which particular 
                                countervailable subsidies are 
                                used by individual 
                                manufacturers, producers, and 
                                exporters; or
                                  (IV) the number of firms 
                                whose activities must be 
                                investigated; and
                          (ii) additional time is necessary to 
                        make the preliminary determination,
        then the administering authority may postpone making 
        the preliminary determination under subsection (b) 
        until not later than the 130th day after the date on 
        which the administering authority initiates an 
        investigation under section 702(c), or an investigation 
        is initiated under section 702(a).
          (2) Notice of postponement.--The administering 
        authority shall notify the parties to the 
        investigation, not later than 20 days before the date 
        on which the preliminary determination would otherwise 
        be required under subsection (b), if it intends to 
        postpone making the preliminary determination under 
        paragraph (1). The notification shall include an 
        explanation of the reasons for the postponement. Notice 
        of the postponement shall be published in the Federal 
        Register.
  (d) Effect of Determination by the Administering Authority.--
If the preliminary determination of the administering authority 
under subsection (b) is affirmative, the administering 
authority--
          (1)(A) shall--
                  (i) determine an estimated individual 
                countervailable subsidy rate for each exporter 
                and producer individually investigated, and, in 
                accordance with section 705(c)(5), an estimated 
                all-others rate for all exporters and producers 
                not individually investigated and for new 
                exporters and producers within the meaning of 
                section 751(a)(2)(B), or
                  (ii) if section 777A(e)(2)(B) applies, 
                determine a single estimated country-wide 
                subsidy rate, applicable to all exporters and 
                producers, and
          (B) shall order the posting of a cash deposit, bond, 
        or other security, as the administering authority deems 
        appropriate, for each entry of the subject merchandise 
        in an amount based on the estimated individual 
        countervailable subsidy rate, the estimated all-others 
        rate, or the estimated country-wide subsidy rate, 
        whichever is applicable,
          (2) shall order the suspension of liquidation of all 
        entries of merchandise subject to the determination 
        which are entered, or withdrawn from warehouse, for 
        consumption on or after the later of--
                  (A) the date on which notice of the 
                determination is published in the Federal 
                Register, or
                  (B) the date that is 60 days after the date 
                on which notice of the determination to 
                initiate the investigation is published in the 
                Federal Register, and
          (3) shall make available to the Commission all 
        information upon which its determination was based and 
        which the Commission considers relevant to its injury 
        determination, under such procedures as the 
        administering authority and the Commission may 
        establish to prevent disclosure, other than with the 
        consent of the party providing it or under protective 
        order, of any information to which confidential 
        treatment has been given by the administering 
        authority.
The instructions of the administering authority under 
paragraphs (1) and (2) may not remain in effect for more than 4 
months.
  (e) Critical Circumstances Determinations.--
          (1) In general.--If a petitioner alleges critical 
        circumstances in its original petition, or by amendment 
        at any time more than 20 days before the date of a 
        final determination by the administering authority, 
        then the administering authority shall promptly (at any 
        time after the initiation of the investigation under 
        this subtitle) determine, on the basis of the 
        information available to it at that time, whether there 
        is a reasonable basis to believe or suspect that--
                  (A) the alleged countervailable subsidy is 
                inconsistent with the Subsidies Agreement, and
                  (B) there have been massive imports of the 
                subject merchandise over a relatively short 
                period.
          (2) Suspension of liquidation.--If the determination 
        of the administering authority under paragraph (1) is 
        affirmative, then any suspension of liquidation ordered 
        under subsection (d)(2) shall apply, or, if notice of 
        such suspension of liquidation is already published, be 
        amended to apply, to unliquidated entries of 
        merchandise entered, or withdrawn from warehouse, for 
        consumption on or after the later of--
                  (A) the date which is 90 days before the date 
                on which the suspension of liquidation was 
                first ordered, or
                  (B) the date on which notice of the 
                determination to initiate the investigation is 
                published in the Federal Register.
  (f) Notice of Determination.--Whenever the Commission or the 
administering authority makes a determination under this 
section, the Commission or the administering authority, as the 
case may be, shall notify the petitioner, and other parties to 
the investigation, and the Commission or the administering 
authority (whichever is appropriate) of its determination. The 
administering authority shall include with such notification 
the facts and conclusions on which its determination is based. 
Not later than 5 days after the date on which the determination 
is required to be made under subsection (a)(2), the Commission 
shall transmit to the administering authority the facts and 
conclusions on which its determination is based.
  (g) Time Period Where Upstream Subsidization Involved.--
          (1) In general.--Whenever the administering authority 
        concludes prior to a preliminary determination under 
        section 703(b), that there is a reasonable basis to 
        believe or suspect that an upstream subsidy is being 
        bestowed, the time period within which a preliminary 
        determination must be made shall be extended to 250 
        days after the filing of a petition under section 
        702(b) or initiation of an investigation under section 
        702(a) (310 days in cases declared extraordinarily 
        complicated under section 703(c)), if the administering 
        authority concludes that such additional time is 
        necessary to make the required determination concerning 
        upstream subsidization.
          (2) Exceptions.--Whenever the administering authority 
        concludes, after a preliminary determination under 
        section 703(b), that there is a reasonable basis to 
        believe or suspect that an upstream subsidy is being 
        bestowed--
                  (A) in cases in which the preliminary 
                determination was negative, the time period 
                within which a final determination must be made 
                shall be extended to 165 or 225 days, as 
                appropriate, under section 705(a)(1); or
                  (B) in cases in which the preliminary 
                determination is affirmative, the determination 
                concerning upstream subsidization--
                          (i) need not be made until the 
                        conclusion of the first annual review 
                        under section 751 of any eventual 
                        countervailing duty order, or, at the 
                        option of the petitioner, or
                          (ii) will be made in the 
                        investigation and the time period 
                        within which a final determination must 
                        be made shall be extended to 165 or 225 
                        days, as appropriate, under section 
                        705(a)(1), as appropriate, except that 
                        the suspension of liquidation ordered 
                        in the preliminary determination shall 
                        terminate at the end of 120 days from 
                        the date of publication of that 
                        determination and not be resumed unless 
                        and until the publication of a 
                        Countervailing Duty Order under section 
                        706(a).
        There may be an extension of time for the making of a 
        final determination under this subsection only if the 
        administering authority determines that such additional 
        time is necessary to make the required determination 
        concerning upstream subsidization.

SEC. 704. TERMINATION OR SUSPENSION OF INVESTIGATION.

  (a) Termination of Investigation Upon Withdrawal of 
Petition.--
          (1) In general.--
                  (A) Withdrawal of petition.--Except as 
                provided in paragraphs (2) and (3), an 
                investigation under this subtitle may be 
                terminated by either the administering 
                authority or the Commission, after notice to 
                all parties to the investigation, upon 
                withdrawal of the petition by the petitioner or 
                by the administering authority if the 
                investigation was initiated under section 
                702(a).
                  (B) Refiling of petition.--If, within 3 
                months after the withdrawal of a petition under 
                subparagraph (A), a new petition is filed 
                seeking the imposition of duties on both the 
                subject merchandise of the withdrawn petition 
                and the subject merchandise from another 
                country, the administering authority and the 
                Commission may use in the investigation 
                initiated pursuant to the new petition any 
                records compiled in an investigation conducted 
                pursuant to the withdrawn petition. This 
                subparagraph applies only with respect to the 
                first withdrawal of a petition.
          (2) Special rules for quantitative restriction 
        agreements.--
                  (A) In general.--Subject to subparagraphs (B) 
                and (C), the administering authority may not 
                terminate an investigation under paragraph (1) 
                by accepting, with the government of the 
                country in which the countervailable subsidy 
                practice is alleged to occur, an understanding 
                or other kind of agreement to limit the volume 
                of imports into the United States of the 
                subject merchandise unless the administering 
                authority is satisfied that termination on the 
                basis of that agreement is in the public 
                interest.
                  (B) Public interest factors.--In making a 
                decision under subparagraph (A) regarding the 
                public interest, the administering authority 
                shall take into account--
                          (i) whether, based upon the relative 
                        impact on consumer prices and the 
                        availability of supplies of the 
                        merchandise, the agreement would have a 
                        greater adverse impact on United States 
                        consumers than the imposition of 
                        countervailing duties;
                          (ii) the relative impact on the 
                        international economic interests of the 
                        United States; and
                          (iii) the relative impact on the 
                        competitiveness of the domestic 
                        industry producing the like 
                        merchandise, including any such impact 
                        on employment and investment in that 
                        industry.
                  (C) Prior consultations.--Before making a 
                decision under subparagraph (A) regarding the 
                public interest, the administering authority 
                shall, to the extent practicable, consult 
                with--
                          (i) potentially affected consuming 
                        industries; and
                          (ii) potentially affected producers 
                        and workers in the domestic industry 
                        producing the like merchandise, 
                        including producers and workers not 
                        party to the investigation.
          (3) Limitation on termination by commission.--The 
        Commission may not terminate an investigation under 
        paragraph (1) before a preliminary determination is 
        made by the administering authority under section 
        703(b).
  (b) Agreements To Eliminate or Offset Completely a 
Countervailable Subsidy or To Cease Exports of Subject 
Merchandise.--The administering authority may suspend an 
investigation if the government of the country in which the 
countervailable subsidy practice is alleged to occur agrees, or 
exporters who account for substantially all of the imports of 
the subject merchandise agree--
          (1) to eliminate the countervailable subsidy 
        completely or to offset completely the amount of the 
        net countervailable subsidy, with respect to that 
        merchandise exported directly or indirectly to the 
        United States, within 6 months after the date on which 
        the investigation is suspended, or
          (2) to cease exports of that merchandise to the 
        United States within 6 months after the date on which 
        the investigation is suspended.
  (c) Agreements Eliminating Injurious Effect.--
          (1) General rule.--If the administering authority 
        determines that extraordinary circumstances are present 
        in a case, it may suspend an investigation upon the 
        acceptance of an agreement from a government described 
        in subsection (b), or from exporters described in 
        subsection (b), if the agreement will eliminate 
        completely the injurious effect of exports to the 
        United States of the subject merchandise.
          (2) Certain additional requirements.--Except in the 
        case of an agreement by a foreign government to 
        restrict the volume of imports of the subject 
        merchandise into the United States, the administering 
        authority may not accept an agreement under this 
        subsection unless--
                  (A) the suppression or undercutting of price 
                levels of domestic products by imports of that 
                merchandise will be prevented, and
                  (B) at least 85 percent of the net 
                countervailable subsidy will be offset.
          (3) Quantitative restrictions agreements.--The 
        administering authority may accept an agreement with a 
        foreign government under this subsection to restrict 
        the volume of imports of subject merchandise into the 
        United States, but it may not accept such an agreement 
        with exporters.
          (4) Definition of extraordinary circumstances.--
                  (A) Extraordinary circumstances.--For 
                purposes of this subsection, the term 
                ``extraordinary circumstances'' means 
                circumstances in which--
                          (i) suspension of an investigation 
                        will be more beneficial to the domestic 
                        industry than continuation of the 
                        investigation, and
                          (ii) the investigation is complex.
                  (B) Complex.--For purposes of this paragraph, 
                the term ``complex'' means--
                          (i) there are a large number of 
                        alleged countervailable subsidy 
                        practices and the practices are 
                        complicated,
                          (ii) the issues raised are novel, or
                          (iii) the number of exporters 
                        involved is large.
  (d) Additional Rules and Conditions.--
          (1) Public interest; monitoring.--The administering 
        authority shall not accept an agreement under 
        subsection (b) or (c) unless--
                  (A) it is satisfied that suspension of the 
                investigation is in the public interest, and
                  (B) effective monitoring of the agreement by 
                the United States is practicable.
        Where practicable, the administering authority shall 
        provide to the exporters who would have been subject to 
        the agreement the reasons for not accepting the 
        agreement and, to the extent possible, an opportunity 
        to submit comments thereon. In applying subparagraph 
        (A) with respect to any quantitative restriction 
        agreement under subsection (c), the administering 
        authority shall take into account, in addition to such 
        other factors as are considered necessary or 
        appropriate, the factors set forth in subsection 
        (a)(2)(B) (i), (ii), and (iii) as they apply to the 
        proposed suspension and agreement, after consulting 
        with the appropriate consuming industries, producers, 
        and workers referred to in subsection (a)(2)(C) (i) and 
        (ii).
          (2) Exports of merchandise to united states not to 
        increase during interim period.--The administering 
        authority may not accept any agreement under subsection 
        (b) unless that agreement provides a means of ensuring 
        that the quantity of the merchandise covered by that 
        agreement exported to the United States during the 
        period provided for elimination or offset of the 
        countervailable subsidy or cessation of exports does 
        not exceed the quantity of such merchandise exported to 
        the United States during the most recent representative 
        period determined by the administering authority.
          (3) Regulations governing entry or withdrawals.--In 
        order to carry out an agreement concluded under 
        subsection (b) or (c), the administering authority is 
        authorized to prescribe regulations governing the 
        entry, or withdrawal from warehouse, for consumption of 
        subject merchandise.
  (e) Suspension of Investigation Procedure.--Before an 
investigation may be suspended under subsection (b) or (c) the 
administering authority shall--
          (1) notify the petitioner of, and consult with the 
        petitioner concerning, its intention to suspend the 
        investigation, and notify other parties to the 
        investigation and the Commission not less than 30 days 
        before the date on which it suspends the investigation,
          (2) provide a copy of the proposed agreement to the 
        petitioner at the time of the notification, together 
        with an explanation of how the agreement will be 
        carried out and enforced (including any action required 
        of foreign governments), and of how the agreement will 
        meet the requirements of subsections (b) and (d), or 
        (c) and (d), and
          (3) permit all interested parties described in 
        section 771(9) to submit comments and information for 
        the record before the date on which notice of 
        suspension of the investigation is published under 
        subsection (f)(1)(A).
  (f) Effects of Suspension of Investigation.--
          (1) In general.--If the administering authority 
        determines to suspend an investigation upon acceptance 
        of an agreement described in subsection (b) or (c), 
        then--
                  (A) it shall suspend the investigation, 
                publish notice of suspension of the 
                investigation, and issue an affirmative 
                preliminary determination under section 703(b) 
                with respect to the subject merchandise, unless 
                it has previously issued such a determination 
                in the same investigation,
                  (B) the Commission shall suspend any 
                investigation it is conducting with respect to 
                that merchandise, and
                  (C) the suspension of investigation shall 
                take effect on the day on which such notice is 
                published.
          (2) Liquidation of entries.--
                  (A) Cessation of exports; complete 
                elimination of net countervailable subsidy.--If 
                the agreement accepted by the administering 
                authority is an agreement described in 
                subsection (b), then--
                          (i) notwithstanding the affirmative 
                        preliminary determination required 
                        under paragraph (1)(A), the liquidation 
                        of entries of subject merchandise shall 
                        not be suspended under section 
                        703(d)(2),
                          (ii) if the liquidation of entries of 
                        such merchandise was suspended pursuant 
                        to a previous affirmative preliminary 
                        determination in the same case with 
                        respect to such merchandise, that 
                        suspension of liquidation shall 
                        terminate, and
                          (iii) the administering authority 
                        shall refund any cash deposit and 
                        release any bond or other security 
                        deposited under section 703(d)(1)(B).
                  (B) Other agreements.--If the agreement 
                accepted by the administering authority is an 
                agreement described in subsection (c), then the 
                liquidation of entries of the subject 
                merchandise shall be suspended under section 
                703(d)(2), or, if the liquidation of entries of 
                such merchandise was suspended pursuant to a 
                previous affirmative preliminary determination 
                in the same case, that suspension of 
                liquidation shall continue in effect, subject 
                to subsection (h)(3), but the security required 
                under section 703(d)(1)(B) may be adjusted to 
                reflect the effect of the agreement.
          (3) Where investigation is continued.--If, pursuant 
        to subsection (g), the administering authority and the 
        Commission continue an investigation in which an 
        agreement has been accepted under subsection (b) or 
        (c), then--
                  (A) if the final determination by the 
                administering authority or the Commission under 
                section 705 is negative, the agreement shall 
                have no force or effect and the investigation 
                shall be terminated, or
                  (B) if the final determinations by the 
                administering authority and the Commission 
                under such section are affirmative, the 
                agreement shall remain in force, but the 
                administering authority shall not issue a 
                countervailing duty order in the case so long 
                as--
                          (i) the agreement remains in force,
                          (ii) the agreement continues to meet 
                        the requirements of subsections (b) and 
                        (d) or (c) and (d), and
                          (iii) the parties to the agreement 
                        carry out their obligations under the 
                        agreement in accordance with its terms.
  (g) Investigation To Be Continued Upon Request.--If the 
administering authority, within 20 days after the date of 
publication of the notice of suspension of an investigation, 
receives a request for the continuation of the investigation 
from--
          (1) the government of the country in which the 
        countervailable subsidy practice is alleged to occur, 
        or
          (2) an interested party described in subparagraph 
        (C), (D), (E), (F), or (G) of section 771(9) which is a 
        party to the investigation,
then the administering authority and the Commission shall 
continue the investigation.
  (h) Review of Suspension.--
          (1) In general.--Within 20 days after the suspension 
        of an investigation under subsection (c), an interested 
        party which is a party to the investigation and which 
        is described in subparagraph (C), (D), (E), (F), or (G) 
        of section 771(9) may, by petition filed with the 
        Commission and with notice to the administering 
        authority, ask for a review of the suspension.
          (2) Commission investigation.--Upon receipt of a 
        review petition under paragraph (1), the Commission 
        shall, within 75 days after the date on which the 
        petition is filed with it, determine whether the 
        injurious effect of imports of the subject merchandise 
        is eliminated completely by the agreement. If the 
        Commission's determination under this subsection is 
        negative, the investigation shall be resumed on the 
        date of publication of notice of such determination as 
        if the affirmative preliminary determination under 
        section 703(b) had been made on that date.
          (3) Suspension of liquidation to continue during 
        review period.--The suspension of liquidation of 
        entries of the subject merchandise shall terminate at 
        the close of the 20-day period beginning on the day 
        after the date on which notice of suspension of the 
        investigation is published in the Federal Register, or, 
        if a review petition is filed under paragraph (1) with 
        respect to the suspension of the investigation, in the 
        case of an affirmative determination by the Commission 
        under paragraph (2), the date on which notice of the 
        affirmative determination by the Commission is 
        published. If the determination of the Commission under 
        paragraph (2) is affirmative, then the administering 
        authority shall--
                  (A) terminate the suspension of liquidation 
                under section 703(d)(2), and
                  (B) release any bond or other security, and 
                refund any cash deposit, required under section 
                703(d)(1)(B).
  (i) Violation of Agreement.--
          (1) In general.--If the administering authority 
        determines that an agreement accepted under subsection 
        (b) or (c) is being, or has been, violated, or no 
        longer meets the requirements of such subsection (other 
        than the requirement, under subsection (c)(1), of 
        elimination of injury) and subsection (d), then, on the 
        date of publication of its determination, it shall--
                  (A) suspend liquidation under section 
                703(d)(2) of unliquidated entries of the 
                merchandise made on or after the later of--
                          (i) the date which is 90 days before 
                        the date of publication of the notice 
                        of suspension of liquidation, or
                          (ii) the date on which the 
                        merchandise, the sale or export to the 
                        United States of which was in violation 
                        of the agreement, or under an agreement 
                        which no longer meets the requirements 
                        of subsections (b) and (d) or (c) and 
                        (d), was first entered, or withdrawn 
                        from warehouse, for consumption.
                  (B) if the investigation was not completed, 
                resume the investigation as if its affirmative 
                preliminary determination under section 703(b) 
                were made on the date of its determination 
                under this paragraph,
                  (C) if the investigation was completed under 
                subsection (g), issue a countervailing duty 
                order under section 706(a) effective with 
                respect to entries of merchandise the 
                liquidation of which was suspended,
                  (D) if it considers the violation to be 
                intentional, notify the Commissioner of Customs 
                who shall take appropriate action under 
                paragraph (2), and
                  (E) notify the petitioner, interested parties 
                who are or were parties to the investigation, 
                and the Commission of its action under this 
                paragraph.
          (2) Intentional violation to be punished by civil 
        penalty.--Any person who intentionally violates an 
        agreement accepted by the administering authority under 
        subsection (b) or (c) shall be subject to a civil 
        penalty assessed in the same amount, in the same 
        manner, and under the same procedure, as the penalty 
        imposed for a fraudulent violation of section 592(a) of 
        this Act.
  (j) Determination Not To Take Agreement Into Account.--In 
making a final determination under section 705, or in 
conducting a review under section 751, in a case in which the 
administering authority has terminated a suspension of 
investigation under subsection (i)(1), or continued an 
investigation under subsection (g), the Commission and the 
administering authority shall consider all of the subject 
merchandise, without regard to the effect of any agreement 
under subsection (b) or (c).
  (k) Termination of Investigations Initiated by Administering 
Authority.--The administering authority may terminate any 
investigation initiated by the administering authority under 
section 702(a) after providing notice of such termination to 
all parties to the investigation.
  (l) Special Rule for Regional Industry Investigations.--
          (1) Suspension agreements.--If the Commission makes a 
        regional industry determination under section 
        771(4)(C), the administering authority shall offer 
        exporters of the subject merchandise who account for 
        substantially all exports of that merchandise for sale 
        in the region concerned the opportunity to enter into 
        an agreement described in subsection (b) or (c).
          (2) Requirements for suspension agreements.--Any 
        agreement described in paragraph (1) shall be subject 
        to all the requirements imposed under this section for 
        other agreements under subsection (b) or (c), except 
        that if the Commission makes a regional industry 
        determination described in paragraph (1) in the final 
        affirmative determination under section 705(b) but not 
        in the preliminary affirmative determination under 
        section 703(a), any agreement described in paragraph 
        (1) may be accepted within 60 days after the 
        countervailing duty order is published under section 
        706.
          (3) Effect of suspension agreement on countervailing 
        duty order.--If an agreement described in paragraph (1) 
        is accepted after the countervailing duty order is 
        published, the administering authority shall rescind 
        the order, refund any cash deposit and release any bond 
        or other security deposited under section 703(d)(1)(B), 
        and instruct the Customs Service that entries of the 
        subject merchandise that were made during the period 
        that the order was in effect shall be liquidated 
        without regard to countervailing duties.

SEC. 705. FINAL DETERMINATIONS.

  (a) Final Determinations by Administering Authority.--
          (1) In general.--Within 75 days after the date of the 
        preliminary determination under section 703(b), the 
        administering authority shall make a final 
        determination of whether or not a countervailable 
        subsidy is being provided with respect to the subject 
        merchandise; except that when an investigation under 
        this subtitle is initiated simultaneously with an 
        investigation under subtitle B, which involves imports 
        of the same class or kind of merchandise from the same 
        or other countries, the administering authority, if 
        requested by the petitioner, shall extend the date of 
        the final determination under this paragraph to the 
        date of the final determination of the administering 
        authority in such investigation initiated under 
        subtitle B.
          (2) Critical circumstances determinations.--If the 
        final determination of the administering authority is 
        affirmative, then that determination, in any 
        investigation in which the presence of critical 
        circumstances has been alleged under section 703(e), 
        shall also contain a finding as to whether--
                  (A) the countervailable subsidy is 
                inconsistent with the Subsidies Agreement, and
                  (B) there have been massive imports of the 
                subject merchandise over a relatively short 
                period.
        Such findings may be affirmative even though the 
        preliminary determination under section 703(e)(1) was 
        negative.
          (3) De minimis countervailable subsidy.--In making a 
        determination under this subsection, the administering 
        authority shall disregard any countervailable subsidy 
        that is de minimis as defined in section 703(b)(4).
  (b) Final Determination by Commission.--
          (1) In general.--The Commission shall make a final 
        determination of whether--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports, or sales (or the likelihood of 
        sales) for importation, of the merchandise with respect 
        to which the administering authority has made an 
        affirmative determination under subsection (a). If the 
        Commission determines that imports of the subject 
        merchandise are negligible, the investigation shall be 
        terminated.
          (2) Period for injury determination following 
        affirmative preliminary determination by administering 
        authority.--If the preliminary determination by the 
        administering authority under section 703(b) is 
        affirmative, then the Commission shall make the 
        determination required by paragraph (1) before the 
        later of--
                  (A) the 120th day after the day on which the 
                administering authority makes its affirmative 
                preliminary determination under section 703(b), 
                or
                  (B) the 45th day after the day on which the 
                administering authority makes its affirmative 
                final determination under subsection (a).
          (3) Period for injury determination following 
        negative preliminary determination by administering 
        authority.--If the preliminary determination by the 
        administering authority under section 703(b) is 
        negative, and its final determination under subsection 
        (a) is affirmative, then the final determination by the 
        Commission under this subsection shall be made within 
        75 days after the date of that affirmative final 
        determination.
          (4) Certain additional findings.--
                  (A) Commission standard for retroactive 
                application.--
                          (i) In general.--If the finding of 
                        the administering authority under 
                        subsection (a)(2) is affirmative, then 
                        the final determination of the 
                        Commission shall include a finding as 
                        to whether the imports subject to the 
                        affirmative determination under 
                        subsection (a)(2) are likely to 
                        undermine seriously the remedial effect 
                        of the countervailing duty order to be 
                        issued under section 706.
                          (ii) Factors to consider.--In making 
                        the evaluation under clause (i), the 
                        Commission shall consider, among other 
                        factors it considers relevant--
                                  (I) the timing and the volume 
                                of the imports,
                                  (II) any rapid increase in 
                                inventories of the imports, and
                                  (III) any other circumstances 
                                indicating that the remedial 
                                effect of the countervailing 
                                duty order will be seriously 
                                undermined.
                  (B) If the final determination of the 
                Commission is that there is no material injury 
                but that there is threat of material injury, 
                then its determination shall also include a 
                finding as to whether material injury by reason 
                of imports of the merchandise with respect to 
                which the administering authority has made an 
                affirmative determination under subsection (a) 
                would have been found but for any suspension of 
                liquidation of entries of that merchandise.
  (c) Effect of Final Determinations.--
          (1) Effect of affirmative determination by the 
        administering authority.--If the determination of the 
        administering authority under subsection (a) is 
        affirmative, then--
                  (A) the administering authority shall make 
                available to the Commission all information 
                upon which such determination was based and 
                which the Commission considers relevant to its 
                determination, under such procedures as the 
                administering authority and the Commission may 
                establish to prevent disclosure, other than 
                with the consent of the party providing it or 
                under protective order, of any information to 
                which confidential treatment has been given by 
                the administering authority,
                  (B)(i) the administering authority shall--
                          (I) determine an estimated individual 
                        countervailable subsidy rate for each 
                        exporter and producer individually 
                        investigated, and, in accordance with 
                        paragraph (5), an estimated all-others 
                        rate for all exporters and producers 
                        not individually investigated and for 
                        new exporters and producers within the 
                        meaning of section 751(a)(2)(B), or
                          (II) if section 777A(e)(2)(B) 
                        applies, determine a single estimated 
                        country-wide subsidy rate, applicable 
                        to all exporters and producers,
                  (ii) shall order the posting of a cash 
                deposit, bond, or other security, as the 
                administering authority deems appropriate, for 
                each entry of the subject merchandise in an 
                amount based on the estimated individual 
                countervailable subsidy rate, the estimated 
                all-others rate, or the estimated country-wide 
                subsidy rate, whichever is applicable, and
                  (C) in cases where the preliminary 
                determination by the administering authority 
                under section 703(b) was negative, the 
                administering authority shall order the 
                suspension of liquidation under paragraph (2) 
                of section 703(d).
          (2) Issuance of order; effect of negative 
        determination.--If the determinations of the 
        administering authority and the Commission under 
        subsections (a)(1) and (b)(1) are affirmative, then the 
        administering authority shall issue a countervailing 
        duty order under section 706(a). If either of such 
        determinations is negative, the investigation shall be 
        terminated upon the publication of notice of that 
        negative determination and the administering authority 
        shall--
                  (A) terminate the suspension of liquidation 
                under section 703(d)(2), and
                  (B) release any bond or other security and 
                refund any cash deposit required under section 
                703(d)(1)(B).
          (3) Effect of negative determinations under 
        subsections (a)(2) and (b)(4)(a).--If the determination 
        of the administering authority or the Commission under 
        subsection (a)(2) and (b)(4)(A), respectively, is 
        negative, then the administering authority shall--
                  (A) terminate any retroactive suspension of 
                liquidation required under paragraph (4) or 
                section 703(e)(2), and
                  (B) release any bond or other security, and 
                refund any cash deposit required, under section 
                703(d)(1)(B) with respect to entries of the 
                merchandise the liquidation of which was 
                suspended retroactively under section 
                703(e)(2).
          (4) Effect of affirmative determination under 
        subsection (a)(2).--If the determination of the 
        administering authority under subsection (a)(2) is 
        affirmative, then the administering authority shall--
                  (A) in cases where the preliminary 
                determinations by the administering authority 
                under sections 703(b) and 703(e)(1) were both 
                affirmative, continue the retroactive 
                suspension of liquidation and the posting of a 
                cash deposit, bond, or other security 
                previously ordered under section 703(e)(2);
                  (B) in cases where the preliminary 
                determination by the administering authority 
                under section 703(b) was affirmative, but the 
                preliminary determination under section 
                703(e)(1) was negative, shall modify any 
                suspension of liquidation and security 
                requirement previously ordered under section 
                703(d) to apply to unliquidated entries of 
                merchandise entered, or withdrawn from 
                warehouse, for consumption on or after the date 
                which is 90 days before the date on which 
                suspension of liquidation was first ordered; or
                  (C) in cases where the preliminary 
                determination by the administering authority 
                under section 703(b) and was negative, shall 
                apply any suspension of liquidation and 
                security requirement ordered under subsection 
                705(c)(1)(B) to unliquidated entries of 
                merchandise entered, or withdrawn from 
                warehouse, for consumption on or after the date 
                which is 90 days before the date on which 
                suspension of liquidation is first ordered.
          (5) Method for determining the all-others rate and 
        the country-wide subsidy rate.--
                  (A) All-others rate.--
                          (i) General rule.--For purposes of 
                        this subsection and section 703(d), the 
                        all-others rate shall be an amount 
                        equal to the weighted average 
                        countervailable subsidy rates 
                        established for exporters and producers 
                        individually investigated, excluding 
                        any zero and de minimis countervailable 
                        subsidy rates, and any rates determined 
                        entirely under section 776.
                          (ii) Exception.--If the 
                        countervailable subsidy rates 
                        established for all exporters and 
                        producers individually investigated are 
                        zero or de minimis rates, or are 
                        determined entirely under section 776, 
                        the administering authority may use any 
                        reasonable method to establish an all-
                        others rate for exporters and producers 
                        not individually investigated, 
                        including averaging the weighted 
                        average countervailable subsidy rates 
                        determined for the exporters and 
                        producers individually investigated.
                  (B) Country-wide subsidy rate.--The 
                administering authority may calculate a single 
                country-wide subsidy rate, applicable to all 
                exporters and producers, if the administering 
                authority limits its examination pursuant to 
                section 777A(e)(2)(B). The estimated country-
                wide rate determined under section 
                703(d)(1)(A)(ii) or paragraph (1)(B)(i)(II) of 
                this subsection shall be based on industry-wide 
                data regarding the use of subsidies determined 
                to be countervailable.
  (d) Publication of Notice of Determinations.--Whenever the 
administering authority or the Commission makes a determination 
under this section, it shall notify the petitioner, other 
parties to the investigation, and the other agency of its 
determination and of the facts and conclusions of law upon 
which the determination is based, and it shall publish notice 
of its determination in the Federal Register.
  (e) Correction of Ministerial Errors.--The administering 
authority shall establish procedures for the correction of 
ministerial errors in final determinations within a reasonable 
time after the determinations are issued under this section. 
Such procedures shall ensure opportunity for interested parties 
to present their views regarding any such errors. As used in 
this subsection, the term ``ministerial error'' includes errors 
in addition, subtraction or other arithmetic function, clerical 
errors resulting from inaccurate copying, duplication, or the 
like, and any other type of unintentional error which the 
administering authority considers ministerial.

SEC. 706. ASSESSMENT OF DUTY.

  (a) Publication of Countervailing Duty Order.--Within 7 days 
after being notified by the Commission of an affirmative 
determination under section 705(b), the administering authority 
shall publish a countervailing duty order which--
          (1) directs customs officers to assess a 
        countervailing duty equal to the amount of the net 
        countervailable subsidy determined or estimated to 
        exist, within 6 months after the date on which the 
        administering authority receives satisfactory 
        information upon which the assessment may be based, but 
        in no event later than 12 months after the end of the 
        annual accounting period of the manufacturer or 
        exporter within which the merchandise is entered, or 
        withdrawn from warehouse, for consumption,
          (2) includes a description of the subject 
        merchandise, in such detail as the administering 
        authority deems necessary, and
          (3) requires the deposit of estimated countervailing 
        duties pending liquidation of entries of merchandise at 
        the same time as estimated normal customs duties on 
        that merchandise are deposited.
  (b) Imposition of Duties.--
          (1) General rule.--If the Commission, in its final 
        determination under section 705(b), finds material 
        injury or threat of material injury which, but for the 
        suspension of liquidation under section 703(d)(2), 
        would have led to a finding of material injury, then 
        entries of the merchandise subject to the 
        countervailing duty order, the liquidation of which has 
        been suspended under section 703(d)(2), shall be 
        subject to the imposition of countervailing duties 
        under section 701(a).
          (2) Special rule.--If the Commission, in its final 
        determination under section 705(b), finds threat of 
        material injury, other than threat of material injury 
        described in paragraph (1), or material retardation of 
        the establishment of an industry in the United States, 
        then merchandise subject to a countervailing duty order 
        which is entered, or withdrawn from warehouse, for 
        consumption on or after the date of publication of 
        notice of an affirmative determination of the 
        Commission under section 705(b) shall be subject to the 
        imposition of countervailing duties under section 
        701(a), and the administering authority shall release 
        any bond or other security, and refund any cash deposit 
        made, to secure the payment of countervailing duties 
        with respect to entries of the merchandise entered, or 
        withdrawn from warehouse, for consumption before that 
        date.
  (c) Special Rule for Regional Industries.--
          (1) In general.--In an investigation under this 
        subtitle in which the Commission makes a regional 
        industry determination under section 771(4)(C), the 
        administering authority shall, to the maximum extent 
        possible, direct that duties be assessed only on the 
        subject merchandise of the specific exporters or 
        producers that exported the subject merchandise for 
        sale in the region concerned during the period of 
        investigation.
          (2) Exception for new exporters and producers.--After 
        publication of the countervailing duty order, if the 
        administering authority finds that a new exporter or 
        producer is exporting the subject merchandise for sale 
        in the region concerned, the administering authority 
        shall direct that duties be assessed on the subject 
        merchandise of the new exporter or producer consistent 
        with the provisions of section 751(a)(2)(B).

SEC. 707. TREATMENT OF DIFFERENCE BETWEEN DEPOSIT OF ESTIMATED 
                    COUNTERVAILING DUTY AND FINAL ASSESSED DUTY UNDER 
                    COUNTERVAILING DUTY ORDER.

  (a) Deposit of Estimated Countervailing Duty Under Section 
703(d)(1)(B).--If the amount of a cash deposit, or the amount 
of any bond or other security, required as security for an 
estimated countervailing duty under section 703(d)(1)(B) is 
different from the amount of the countervailing duty determined 
under a countervailing duty order issued under section 706, 
then the difference for entries of merchandise entered, or 
withdrawn from warehouse, for consumption before notice of the 
affirmative determination of the Commission under section 
705(b) is published shall be--
          (1) disregarded, to the extent that the cash deposit, 
        bond, or other security is lower than the duty under 
        the order, or
          (2) refunded or released, to the extent that the cash 
        deposit, bond, or other security is higher than the 
        duty under the order.
  (b) Deposit of Estimated Countervailing Duty Under Section 
706(a)(3).--If the amount of an estimated countervailing duty 
deposited under section 706(a)(3) is different from the amount 
of the countervailing duty determined under a countervailing 
duty order issued under section 706, then the difference for 
entries of merchandise entered, or withdrawn from warehouse, 
for consumption after notice of the affirmative determination 
of the Commission under section 705(b) is published shall be--
          (1) collected, to the extent that the deposit under 
        section 706(a)(3) is lower than the duty determined 
        under the order, or
          (2) refunded, to the extent that the deposit under 
        section 706(a)(3) is higher than the duty determined 
        under the order,
together with interest as provided by section 778.

SEC. 708. EFFECT OF DEROGATION OF EXPORT-IMPORT BANK  FINANCING.

  Nothing in this title shall be interpreted as superseding the 
provisions of section 1912 of the Export-Import Bank Act 
Amendments of 1978, except that in the event of an assessment 
of duty based on a derogation under section 706 or action under 
section 703(d)(1)(B), the Secretary of the Treasury shall not 
authorize the Bank to provide guarantees, insurance and credits 
to competing United States sellers pursuant to section 1912 of 
such Act.

SEC. 709. CONDITIONAL PAYMENT OF COUNTERVAILING DUTY.

  (a) In General.--For all entries, or withdrawals from 
warehouse, for consumption of merchandise subject to a 
countervailing duty order on or after the date of publication 
of such order, no customs officer may deliver merchandise of 
that class or kind to the person by whom or for whose account 
it was imported unless that person complies with the 
requirement of subsection (b) and deposits with the appropriate 
customs officer an estimated countervailing duty in an amount 
determined by the administering authority.
  (b) Importer Requirements.--In order to meet the requirements 
of this subsection, a person shall--
          (1) furnish, or arrange to have furnished, to the 
        appropriate customs officer such information as the 
        administering authority deems necessary for 
        ascertaining any countervailing duty to be imposed 
        under this subtitle,
          (2) maintain and furnish to the customs officer such 
        records concerning such merchandise as the 
        administering authority, by regulation, requires, and
          (3) pay, or agree to pay on demand, to the customs 
        officer the amount of countervailing duty imposed under 
        this subtitle on that merchandise.

                         2. Antidumping Duties


 Subtitle B of Title VII (Sections 731-739) of the Tariff Act of 1930, 
                               as amended


 [19 U.S.C. 1673-1673h; P.L. 71-361, as amended by P.L. 96-39, P.L. 98-
 573, P.L. 99-514, P.L. 100-418, P.L. 100-647, P.L. 103-465, and P.L. 
                                104-295]

SEC. 731. ANTIDUMPING DUTIES IMPOSED.

    If--
          (1) the administering authority determines that a 
        class or kind of foreign merchandise is being, or is 
        likely to be, sold in the United States at less than 
        its fair value, and
          (2) the Commission determines that--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports of that merchandise or by reason 
        of sales (or the likelihood of sales) of that 
        merchandise for importation,
then there shall be imposed upon such merchandise an 
antidumping duty, in addition to any other duty imposed, in an 
amount equal to the amount by which the normal value exceeds 
the export price (or the constructed export price) for the 
merchandise. For purposes of this subsection and section 
735(b)(1), a reference to the sale of foreign merchandise 
includes the entering into of any leasing arrangement regarding 
the merchandise that is equivalent to the sale of the 
merchandise.

SEC. 732. PROCEDURES FOR INITIATING AN ANTIDUMPING DUTY INVESTIGATION.

  (a) Initiation by Administering Authority.--
          (1) In general.--An antidumping duty investigation 
        shall be initiated whenever the administering authority 
        determines, from information available to it, that a 
        formal investigation is warranted into the question of 
        whether the elements necessary for the imposition of a 
        duty under section 731 exist.
          (2) Cases involving persistent dumping.--
                  (A) Monitoring.--The administering authority 
                may establish a monitoring program with respect 
                to imports of a class or kind of merchandise 
                from any additional supplier country for a 
                period not to exceed one year if--
                          (i) more than one antidumping order 
                        is in effect with respect to that class 
                        or kind of merchandise;
                          (ii) in the judgment of the 
                        administering authority there is reason 
                        to believe or suspect an extraordinary 
                        pattern of persistent injurious dumping 
                        from one or more additional supplier 
                        countries; and
                          (iii) in the judgment of the 
                        administering authority this 
                        extraordinary pattern is causing a 
                        serious commercial problem for the 
                        domestic industry.
                  (B) If during the period of monitoring 
                referred to in subparagraph (A), the 
                administering authority determines that there 
                is sufficient information to initiate a formal 
                investigation under this subsection regarding 
                an additional supplier country, the 
                administering authority shall immediately 
                initiate such an investigation.
                  (C) Definition.--For purposes of this 
                paragraph, the term ``additional supplier 
                country'' means a country regarding which no 
                antidumping investigation is currently pending, 
                and no antidumping duty order is currently in 
                effect, with respect to imports of the class or 
                kind of merchandise covered by subparagraph 
                (A).
                  (D) Expeditious action.--The administering 
                authority and the Commission, to the extent 
                practicable, shall expedite proceedings under 
                this subtitle undertaken as a result of a 
                formal investigation initiated under 
                subparagraph (B).
  (b) Initiation by Petition.--
          (1) Petition requirements.--An antidumping proceeding 
        shall be initiated whenever an interested party 
        described in subparagraph (C), (D), (E), (F), or (G) of 
        section 771(9) files a petition with the administering 
        authority, on behalf of an industry, which alleges the 
        elements necessary for the imposition of the duty 
        imposed by section 731, and which is accompanied by 
        information reasonably available to the petitioner 
        supporting those allegations. The petition may be 
        amended at such time, and upon such conditions, as the 
        administering authority and the Commission may permit.
          (2) Simultaneous filing with commission.--The 
        petitioner shall file a copy of the petition with the 
        Commission on the same day as it is filed with the 
        administering authority.
          (3) Action with respect to petitions.--
                  (A) Notification of governments.--Upon 
                receipt of a petition filed under paragraph 
                (1), the administering authority shall notify 
                the government of any exporting country named 
                in the petition by delivering a public version 
                of the petition to an appropriate 
                representative of such country.
                  (B) Acceptance of communications.--The 
                administering authority shall not accept any 
                unsolicited oral or written communication from 
                any person other than an interested party 
                described in section 771(9) (C), (D), (E), (F), 
                or (G) before the administering authority makes 
                its decision whether to initiate an 
                investigation, except as provided in subsection 
                (c)(4)(D), and except for inquiries regarding 
                the status of the administering authority's 
                consideration of the petition.
                  (C) Nondisclosure of certain information.--
                The administering authority and the Commission 
                shall not dis-close information with regard to 
                any draft petition sub-mitted for review and 
                comment before it is filed under paragraph (1).
  (c) Petition Determination.--
          (1) In general.--
                  (A) Time for initial determination.--Except 
                as provided in subparagraph (B), within 20 days 
                after the date on which a petition is filed 
                under subsection (b), the administering 
                authority shall--
                          (i) after examining, on the basis of 
                        sources readily available to the 
                        administering authority, the accuracy 
                        and adequacy of the evidence provided 
                        in the petition, determine whether the 
                        petition alleges the elements necessary 
                        for the imposition of a duty under 
                        section 731 and contains information 
                        reasonably available to the petitioner 
                        supporting the allegations, and
                          (ii) determine if the petition has 
                        been filed by or on behalf of the 
                        industry.
                  (B) Extension of time.--In any case in which 
                the administering authority is required to poll 
                or otherwise determine support for the petition 
                by the industry under paragraph (4)(D), the 
                administering authority may, in exceptional 
                circumstances, apply subparagraph (A) by 
                substituting ``a maximum of 40 days'' for ``20 
                days''.
                  (C) Time limits where petition involves same 
                merchandise as an order that has been 
                revoked.--If a petition is filed under this 
                section with respect to merchandise that was 
                the subject merchandise of--
                          (i) an antidumping duty order or 
                        finding that was revoked under section 
                        751(d) in the 24 months preceding the 
                        date the petition is filed, or
                          (ii) a suspended investigation that 
                        was terminated under section 751(d) in 
                        the 24 months preceding the date the 
                        petition is filed,
                the administering authority and the Commission 
                shall, to the maximum extent practicable, 
                expedite any investigation initiated under this 
                section with respect to the petition.
          (2) Affirmative determinations.--If the 
        determinations under clauses (i) and (ii) of paragraph 
        (1)(A) are affirmative, the administering authority 
        shall initiate an investigation to determine whether 
        the subject merchandise is being, or is likely to be, 
        sold in the United States at less than its fair value.
          (3) Negative determinations.--If the determination 
        under clause (i) or (ii) of paragraph (1)(A) is 
        negative, the administering authority shall dismiss the 
        petition, terminate the proceeding, and notify the 
        petitioner in writing of the reasons for the 
        determination.
          (4) Determination of industry support.--
                  (A) General rule.--For purposes of this 
                subsection, the administering authority shall 
                determine that the petition has been filed by 
                or on behalf of the industry, if--
                          (i) the domestic producers or workers 
                        who support the petition account for at 
                        least 25 percent of the total 
                        production of the domestic like 
                        product, and
                          (ii) the domestic producers or 
                        workers who support the petition 
                        account for more than 50 percent of the 
                        production of the domestic like product 
                        produced by that portion of the 
                        industry expressing support for or 
                        opposition to the petition.
                  (B)  Certain positions disregarded.--
                          (i) Producers related to foreign 
                        producers.--In determining industry 
                        support under subparagraph (A), the 
                        administering authority shall disregard 
                        the position of domestic producers who 
                        oppose the petition, if such producers 
                        are related to foreign producers, as 
                        defined in section 771(4)(B)(ii), 
                        unless such domestic producers 
                        demonstrate that their interests as 
                        domestic producers would be adversely 
                        affected by the imposition of an 
                        antidumping duty order.
                          (ii) Producers who are importers.--
                        The administering authority may 
                        disregard the position of domestic 
                        producers of a domestic like product 
                        who are importers of the subject 
                        merchandise.
                  (C) Special rule for regional industries.--If 
                the petition alleges the industry is a regional 
                industry, the administering authority shall 
                determine whether the petition has been filed 
                by or on behalf of the industry by applying 
                subparagraph (A) on the basis of production in 
                the region.
                  (D) Polling the industry.--If the petition 
                does not establish support of domestic 
                producers or workers accounting for more than 
                50 percent of the total production of the 
                domestic like product, the administering 
                authority shall--
                          (i) poll the industry or rely on 
                        other information in order to determine 
                        if there is support for the petition as 
                        required by subparagraph (A), or
                          (ii) if there is a large number of 
                        producers in the industry, the 
                        administering authority may determine 
                        industry support for the petition by 
                        using any statistically valid sampling 
                        method to poll the industry.
                  (E) Comments by interested parties.--Before 
                the administering authority makes a 
                determination with respect to initiating an 
                investigation, any person who would qualify as 
                an interested party under section 771(9) if an 
                investigation were initiated, may submit 
                comments or information on the issue of 
                industry support. After the administering 
                authority makes a determination with respect to 
                initiating an investigation, the determination 
                regarding industry support shall not be 
                reconsidered.
          (5) Definition of domestic producers or workers.--For 
        purposes of this subsection, the term ``domestic 
        producers or workers'' means those interested parties 
        who are eligible to file a petition under subsection 
        (b)(1).
  (d) Notification to Commission of Determination.--The 
administering authority shall--
          (1) notify the Commission immediately of any 
        determination it makes under subsection (a) or (c), and
          (2) if the determination is affirmative, make 
        available to the Commission such information as it may 
        have relating to the matter under investigation, under 
        such procedures as the administering authority and the 
        Commission may establish to prevent disclosure, other 
        than with the consent of the party providing it or 
        under protective order, of any information to which 
        confidential treatment has been given by the 
        administering authority.
  (e) Information Regarding Critical Circumstances.--If, at any 
time after the initiation of an investigation under this 
subtitle, the administering authority finds a reasonable basis 
to suspect that--
          (1) there is a history of dumping in the United 
        States or elsewhere of the subject merchandise, or
          (2) the person by whom, or for whose account, the 
        merchandise was imported knew, or should have known, 
        that the exporter was selling the subject merchandise 
        at less than its fair value,
the administering authority may request the Commissioner of 
Customs to compile information on an expedited basis regarding 
entries of the subject merchandise. Upon receiving such 
request, the Commissioner of Customs shall collect information 
regarding the volume and value of entries of the subject 
merchandise and shall transmit such information to the 
administering authority at such times as the administering 
authority shall direct (at least once every 30 days), until a 
final determination is made under section 735(a), the 
investigation is terminated, or the administering authority 
withdraws the request.

SEC. 733. PRELIMINARY DETERMINATIONS.

  (a) Determination by Commission of Reasonable Indication of 
Injury.--
          (1) General rule.--Except in the case of a petition 
        dismissed by the administering authority under section 
        732(c)(3), the Commission, within the time specified in 
        paragraph (2), shall determine, based on the 
        information available to it at the time of the 
        determination, whether there is a reasonable indication 
        that--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports of the subject merchandise and 
        that imports of the subject merchandise are not 
        negligible. If the Commission finds that imports of the 
        subject merchandise are negligible or otherwise makes a 
        negative determination under this paragraph, the 
        investigation shall be terminated.
          (2) Time for commission determination.--The 
        Commission shall make the determination described in 
        paragraph (1)--
                  (A) in the case of a petition filed under 
                section 732(b)--
                          (i) within 45 days after the date on 
                        which the petition is filed, or
                          (ii) if the time has been extended 
                        pursuant to section 732(c)(1)(B), 
                        within 25 days after the date on which 
                        the Commission receives notice from the 
                        administering authority of initiation 
                        of the investigation, and
                  (B) in the case of an investigation initiated 
                under section 732(a), within 45 days after the 
                date on which the Commission receives notice 
                from the administering authority that an 
                investigation has been initiated under such 
                section.
  (b) Preliminary Determination by Administering Authority.--
          (1) Period of antidumping duty investigation.--
                  (A) In general.--Except as provided in 
                subparagraph (B), within 140 days after the 
                date on which the administering authority 
                initiates an investigation under section 
                732(c), or an investigation is initiated under 
                section 732(a), but not before an affirmative 
                determination by the Commission under 
                subsection (a) of this section, the 
                administering authority shall make a 
                determination, based upon the information 
                available to it at the time of the 
                determination, of whether there is a reasonable 
                basis to believe or suspect that the 
                merchandise is being sold, or is likely to be 
                sold at less than fair value.
                  (B) If certain short life cycle merchandise 
                involved.--If a petition filed under section 
                732(b), or an investigation initiated under 
                section 732(a), concerns short life cycle 
                merchandise that is included in a product 
                category established under section 739(a), 
                subparagraph (A) shall be applied--
                          (i) by substituting ``100 days'' for 
                        ``140 days'' if manufacturers that are 
                        second offenders account for a 
                        significant proportion of the 
                        merchandise under investigation, and
                          (ii) by substituting ``80 days'' for 
                        ``140 days'' if manufacturers that are 
                        multiple offenders account for a 
                        significant proportion of the 
                        merchandise under investigation.
                  (C) Definitions of offenders.--For purposes 
                of subparagraph (B)--
                          (i) the term ``second offender'' 
                        means a manufacturer that is specified 
                        in 2 affirmative dumping determinations 
                        (within the meaning of section 739) as 
                        the manufacturer of short life cycle 
                        merchandise that is--
                                  (I) specified in both such 
                                determinations, and
                                  (II) within the scope of the 
                                product category referred to in 
                                subparagraph (B).
                          (ii) the term ``multiple offender'' 
                        means a manufacturer that is specified 
                        in 3 or more affirmative dumping 
                        determinations (within the meaning of 
                        section 739) as the manufacturer of 
                        short life cycle merchandise that is--
                                  (I) specified in each of such 
                                determinations, and
                                  (II) within the scope of the 
                                product category referred to in 
                                subparagraph (B).
          (2) Preliminary determination under waiver of 
        verification.--Within 75 days after the initiation of 
        an investigation, the administering authority shall 
        cause an official designated for such purpose to review 
        the information concerning the case received during the 
        first 60 days of the investigation, and, if there 
        appears to be sufficient information available upon 
        which the preliminary determination can reasonably be 
        based, to disclose to the petitioner and any interested 
        party, then a party to the proceedings that requests 
        such disclosure, all available non-confidential 
        information and all other information which is 
        disclosed pursuant to section 777. Within 3 days (not 
        counting Saturdays, Sundays, or legal public holidays) 
        after such disclosure, the petitioner and each party 
        which is an interested party described in subparagraph 
        (C), (D), (E), (F), or (G) of section 771(9) to whom 
        such disclosure was made may furnish to the 
        administering authority an irrevocable written waiver 
        of verification of the information received by the 
        authority, and an agreement that it is willing to have 
        a preliminary determination made on the basis of the 
        record then available to the authority. If a timely 
        waiver and agreement have been received from the 
        petitioner and each party which is an interested party 
        described in subparagraph (C), (D), (E), (F), or (G) of 
        section 771(9) to whom the disclosure was made, and the 
        authority finds that sufficient information is then 
        available upon which the preliminary determination can 
        reasonably be based, a preliminary determination shall 
        be made within 90 days after the initiation of the 
        investigation on the basis of the record established 
        during the first 60 days after the investigation was 
        initiated.
          (3) De minimis dumping margin.--In making a 
        determination under this subsection, the administering 
        authority shall disregard any weighted average dumping 
        margin that is de minimis. For purposes of the 
        preceding sentence, a weighted average dumping margin 
        is de minimis if the administering authority determines 
        that it is less than 2 percent ad valorem or the 
        equivalent specific rate for the subject merchandise.
  (c) Extension of Period in Extraordinarily Complicated 
Cases.--
          (1) In general.--If--
                  (A) the petitioner makes a timely request for 
                an extension of the period within which the 
                determination must be made under subsection 
                (b)(1), or
                  (B) the administering authority concludes 
                that the parties concerned are cooperating and 
                determines that--
                          (i) the case is extraordinarily 
                        complicated by reason of--
                                  (I) the number and complexity 
                                of the transactions to be 
                                investigated or adjustments to 
                                be considered,
                                  (II) the novelty of the 
                                issues presented, or
                                  (III) the number of firms 
                                whose activities must be 
                                investigated, and
                          (ii) additional time is necessary to 
                        make the preliminary determination,
        then the administering authority may postpone making 
        the preliminary determination under subsection (b)(1) 
        until not later than the 190th day after the date on 
        which the administering authority initiates an 
        investigation under section 732(c), or an investigation 
        is initiated under section 732(a). No extension of a 
        determination date may be made under this paragraph for 
        any investigation in which a determination date 
        provided for in subsection (b)(1)(B) applies unless the 
        petitioner submits written notice to the administering 
        authority of its consent to the extension.
          (2) Notice of postponement.--The administering 
        authority shall notify the parties to the 
        investigation, not later than 20 days before the date 
        on which the preliminary determination would otherwise 
        be required under subsection (b)(1), if it intends to 
        postpone making the preliminary determination under 
        paragraph (1). The notification shall include an 
        explanation of the reasons for the postponement, and 
        notice of the postponement shall be published in the 
        Federal Register.
  (d) Effect of Determination by the Administering Authority.--
If the preliminary determination of the administering authority 
under subsection (b) is affirmative, the administering 
authority--
          (1)(A) shall--
                  (i) determine an estimated weighted average 
                dumping margin for each exporter and producer 
                individually investigated, and
                  (ii) determine, in accordance with section 
                735(c)(5), an estimated all-others rate for all 
                exporters and producers not individually 
                investigated, and
          (B) shall order the posting of a cash deposit, bond, 
        or other security, as the administering authority deems 
        appropriate, for each entry of the subject merchandise 
        in an amount based on the estimated weighted average 
        dumping margin or the estimated all-others rate, 
        whichever is applicable,
          (2) shall order the suspension of liquidation of all 
        entries of merchandise subject to the determination 
        which are entered, or withdrawn from warehouse, for 
        consumption on or after the later of--
                  (A) the date on which notice of the 
                determination is published in the Federal 
                Register, or
                  (B) the date that is 60 days after the date 
                on which notice of the determination to 
                initiate the investigation is published in the 
                Federal Register, and
          (3) shall make available to the Commission all 
        information upon which such determination was based and 
        which the Commission considers relevant to its injury 
        determination, under such procedures as the 
        administering authority and the Commission may 
        establish to prevent disclosure, other than with the 
        consent of the party providing it or under protective 
        order, of any information to which confidential 
        treatment has been given by the administering 
        authority.
The instructions of the administering authority under 
paragraphs (1) and (2) may not remain in effect for more than 4 
months, except that the administering authority may, at the 
request of exporters representing a significant proportion of 
exports of the subject merchandise, extend that 4-month period 
to not more than 6 months.
  (e) Critical Circumstances Determinations.--
          (1) In general.--If a petitioner alleges critical 
        circumstances in its original petition, or by amendment 
        at any time more than 20 days before the date of a 
        final determination by the administering authority, 
        then the administering authority shall promptly (at any 
        time after the initiation of the investigation under 
        this subtitle) determine, on the basis of the 
        information available to it at that time, whether there 
        is a reasonable basis to believe or suspect that--
                  (A)(i) there is a history of dumping and 
                material injury by reason of dumped imports in 
                the United States or elsewhere of the subject 
                merchandise, or
                  (ii) the person by whom, or for whose 
                account, the merchandise was imported knew or 
                should have known that the exporter was selling 
                the subject merchandise at less than its fair 
                value and that there was likely to be material 
                injury by reason of such sales, and
                  (B) there have been massive imports of the 
                subject merchandise over a relatively short 
                period.
        The administering authority shall be treated as having 
        made an affirmative determination under subparagraph 
        (A) in any investigation to which subsection (b)(1)(B) 
        is applied.
          (2) Suspension of liquidation.--If the determination 
        of the administering authority under paragraph (1) is 
        affirmative, then any suspension of liquidation ordered 
        under subsection (d)(2) shall apply, or, if notice of 
        such suspension of liquidation is already published, be 
        amended to apply, to unliquidated entries of 
        merchandise entered, or withdrawn from warehouse, for 
        consumption on or after the later of--
                  (A) the date which is 90 days before the date 
                on which the suspension of liquidation was 
                first ordered, or
                  (B) the date on which notice of the 
                determination to initiate the investigation is 
                published in the Federal Register.
  (f) Notice of Determination.--Whenever the Commission or the 
administering authority makes a determination under this 
section, the Commission or the administering authority, as the 
case may be, shall notify the petitioner, and other parties to 
the investigation, and the Commission or the administering 
authority (whichever is appropriate) of its determination. The 
administering authority shall include with such notification 
the facts and conclusions on which its determination is based. 
Not later than 5 days after the date on which the determination 
is required to be made under subsection (a)(2), the Commission 
shall transmit to the administering authority the facts and 
conclusions on which its determination is based.

SEC. 734. TERMINATION OR SUSPENSION OF INVESTIGATION.

  (a) Termination of Investigation Upon Withdrawal of 
Petition.--
          (1) In general.--
                  (A) Withdrawal of petition.--Except as 
                provided in paragraphs (2) and (3), an 
                investigation under this subtitle may be 
                terminated by either the administering 
                authority or the Commission, after notice to 
                all parties to the investigation, upon 
                withdrawal of the petition by the petitioner or 
                by the administering authority if the 
                investigation was initiated under section 
                732(a).
                  (B) Refiling of petition.--If, within 3 
                months after the withdrawal of a petition under 
                subparagraph (A), a new petition is filed 
                seeking the imposition of duties on both the 
                subject merchandise of the withdrawn petition 
                and the subject merchandise from another 
                country, the administering authority and the 
                Commission may use in the investigation 
                initiated pursuant to the new petition any 
                records compiled in an investigation conducted 
                pursuant to the withdrawn petition. This 
                subparagraph applies only with respect to the 
                first withdrawal of a petition.
          (2) Special rules for quantitative restriction 
        agreements.--
                  (A) In general.--Subject to subparagraphs (B) 
                and (C), the administering authority may not 
                terminate an investigation under paragraph (1) 
                by accepting an understanding or other kind of 
                agreement to limit the volume of imports into 
                the United States of the subject merchandise 
                unless the administering authority is satisfied 
                that termination on the basis of that agreement 
                is in the public interest.
                  (B) Public interest factors.--In making a 
                decision under subparagraph (A) regarding the 
                public interest the administering authority 
                shall take into account--
                          (i) whether, based upon the relative 
                        impact on consumer prices and the 
                        availability of supplies of the 
                        merchandise, the agreement would have a 
                        greater adverse impact on United States 
                        consumers than the imposition of 
                        antidumping duties;
                          (ii) the relative impact on the 
                        international eco- nomic interests of 
                        the United States; and
                          (iii) the relative impact on the 
                        competitiveness of the domestic 
                        industry producing the like 
                        merchandise, including any such impact 
                        on employment and investment in that 
                        industry.
                  (C) Prior consultations.--Before making a 
                decision under subparagraph (A) regarding the 
                public interest, the administering authority 
                shall, to the extent practicable, consult 
                with--
                          (i) potentially affected consuming 
                        industries; and
                          (ii) potentially affected producers 
                        and workers in the domestic industry 
                        producing the like merchandise, 
                        including producers and workers not 
                        party to the investigation.
          (3) Limitation on termination by commission.--The 
        Commission may not terminate an investigation under 
        paragraph (1) before a preliminary determination is 
        made by the administering authority under section 
        733(b).
  (b) Agreements To Eliminate Completely Sales at Less Than 
Fair Value or To Cease Exports of Merchandise.--The 
administering authority may suspend an investigation if the 
exporters of the subject merchandise who account for 
substantially all of the imports of that merchandise agree--
          (1) to cease exports of the merchandise to the United 
        States within 6 months after the date on which the 
        investigation is suspended, or
          (2) to revise their prices to eliminate completely 
        any amount by which the normal value of the merchandise 
        which is the subject of the agreement exceeds the 
        export price (or the constructed export price) of that 
        merchandise.
  (c) Agreements Eliminating Injurious Effect.--
          (1) General rule.--If the administering authority 
        determines that extraordinary circumstances are present 
        in a case, it may suspend an investigation upon the 
        acceptance of an agreement to revise prices from 
        exporters of the subject merchandise who account for 
        substantially all of the imports of that merchandise 
        into the United States, if the agreement will eliminate 
        completely the injurious effect of exports to the 
        United States of that merchandise and if--
                  (A) the suppression or undercutting of price 
                levels of domestic products by imports of that 
                merchandise will be prevented, and
                  (B) for each entry of each exporter the 
                amount by which the estimated normal value 
                exceeds the export price (or the constructed 
                export price) will not exceed 15 percent of the 
                weighted average amount by which the estimated 
                normal value exceeded the export price (or the 
                constructed export price) for all less-than-
                fair-value entries of the exporter examined 
                during the course of the investigation.
          (2) Definition of extraordinary circumstances.--
                  (A) Extraordinary circumstances.--For 
                purposes of this subsection, the term 
                ``extraordinary circumstances'' means 
                circumstances in which--
                          (i) suspension of an investigation 
                        will be more beneficial to the domestic 
                        industry than continuation of the 
                        investigation, and
                          (ii) the investigation is complex.
                  (B) Complex.--For purposes of this paragraph, 
                the term ``complex'' means--
                          (i) there are a large number of 
                        transactions to be investigated or 
                        adjustments to be considered,
                          (ii) the issues raised are novel, or
                          (iii) the number of firms involved is 
                        large.
  (d) Additional Rules and Conditions.--The administering 
authority may not accept an agreement under subsection (b) or 
(c) unless--
          (1) it is satisfied that suspension of the 
        investigation is in the public interest, and
          (2) effective monitoring of the agreement by the 
        United States is practicable.
Where practicable, the administering authority shall provide to 
the exporters who would have been subject to the agreement the 
reasons for not accepting the agreement and, to the extent 
possible, an opportunity to submit comments thereon.
  (e) Suspension of Investigation Procedure.--Before an 
investigation may be suspended under subsection (b) or (c) the 
administering authority shall--
          (1) notify the petitioner of, and consult with the 
        petitioner concerning, its intention to suspend the 
        investigation, and notify other parties to the 
        investigation and the Commission not less than 30 days 
        before the date on which it suspends the investigation,
          (2) provide a copy of the proposed agreement to the 
        petitioner at the time of the notification, together 
        with an explanation of how the agreement will be 
        carried out and enforced, and of how the agreement will 
        meet the requirements of subsections (b) and (d) or (c) 
        and (d), and
          (3) permit all interested parties described in 
        section 771(9) to submit comments and information for 
        the record before the date on which notice of 
        suspension of the investigation is published under 
        subsection (f)(1)(A).
  (f) Effects of Suspension of Investigation.--
          (1) In general.--If the administering authority 
        determines to suspend an investigation upon acceptance 
        of an agreement described in subsection (b) or (c), 
        then--
                  (A) it shall suspend the investigation, 
                publish notice of suspension of the 
                investigation, and issue an affirmative 
                preliminary determination under section 733(b) 
                with respect to the subject merchandise, unless 
                it has previously issued such a determination 
                in the same investigation,
                  (B) the Commission shall suspend any 
                investigation it is conducting with respect to 
                that merchandise, and
                  (C) the suspension of investigation shall 
                take effect on the day on which such notice is 
                published.
          (2) Liquidation of entries.--
                  (A) Cessation of exports; complete 
                elimination of dumping margin.--If the 
                agreement accepted by the administering 
                authority is an agreement described in 
                subsection (b), then--
                          (i) notwithstanding the affirmative 
                        preliminary determination required 
                        under paragraph (1)(A), the liquidation 
                        of entries of subject merchandise shall 
                        not be suspended under section 
                        733(d)(2),
                          (ii) if the liquidation of entries of 
                        such merchandise was suspended pursuant 
                        to a previous affirmative preliminary 
                        determination in the same case with 
                        respect to such merchandise, that 
                        suspension of liquidation shall 
                        terminate, and
                          (iii) the administering authority 
                        shall refund any cash deposit and 
                        release any bond or other security 
                        deposited under section 733(d)(1)(B).
                  (B) Other agreements.--If the agreement 
                accepted by the administering authority is an 
                agreement described in subsection (c), the 
                liquidation of entries of the subject 
                merchandise shall be suspended under section 
                733(d)(2), or, if the liquidation of entries of 
                such merchandise was suspended pursuant to a 
                previous affirmative preliminary determination 
                in the same case, that suspension of 
                liquidation shall continue in effect, subject 
                to subsection (h)(3), but the security required 
                under section 733(d)(1)(B) may be adjusted to 
                reflect the effect of the agreement.
          (3) Where investigation is continued.--If, pursuant 
        to subsection (g), the administering authority and the 
        Commission continue an investigation in which an 
        agreement has been accepted under subsection (b) or 
        (c), then--
                  (A) if the final determination by the 
                administering authority or the Commission under 
                section 735 is negative, the agreement shall 
                have no force or effect and the investigation 
                shall be terminated, or
                  (B) if the final determinations by the 
                administering authority and the Commission 
                under such section are affirmative, the 
                agreement shall remain in force, but the 
                administering authority shall not issue an 
                antidumping duty order in the case so long as--
                          (i) the agreement remains in force,
                          (ii) the agreement continues to meet 
                        the requirements of subsections (b) and 
                        (d), or (c) and (d), and
                          (iii) the parties to the agreement 
                        carry out their obligations under the 
                        agreement in accordance with its terms.
  (g) Investigation To Be Continued Upon Request.--If the 
administering authority, within 20 days after the date of 
publication of the notice of suspension of an investigation, 
receives a request for the continuation of the investigation 
from--
          (1) an exporter or exporters accounting for a 
        significant proportion of exports to the United States 
        of the subject merchandise, or
          (2) an interested party described in subparagraph 
        (C), (D), (E), (F), or (G) of section 771(9) which is a 
        party to the investigation,
then the administering authority and the Commission shall 
continue the investigation.
  (h) Review of Suspension.--
          (1) In general.--Within 20 days after the suspension 
        of an investigation under subsection (c), an interested 
        party which is a party to the investigation and which 
        is described in subparagraph (C), (D), (E), (F), or (G) 
        of section 771(9) may, by petition filed with the 
        Commission and with notice to the administering 
        authority, ask for a review of the suspension.
          (2) Commission investigation.--Upon receipt of a 
        review petition under paragraph (1), the Commission 
        shall, within 75 days after the date on which the 
        petition is filed with it, determine whether the 
        injurious effect of imports of the subject merchandise 
        is eliminated completely by the agreement. If the 
        Commission's determination under this subsection is 
        negative, the investigation shall be resumed on the 
        date of publication of notice of such determination as 
        if the affirmative preliminary determination under 
        section 733(b) had been made on that date.
          (3) Suspension of liquidation to continue during 
        review period.--The suspension of liquidation of 
        entries of the subject merchandise shall terminate at 
        the close of the 20-day period beginning on the day 
        after the date on which notice of suspension of the 
        investigation is published in the Federal Register, or, 
        if a review petition is filed under paragraph (1) with 
        respect to the suspension of the investigation, in the 
        case of an affirmative determination by the Commission 
        under paragraph (2), the date on which notice of an 
        affirmative determination by the Commission is 
        published. If the determination of the Commission under 
        paragraph (2) is affirmative, then the administering 
        authority shall--
                  (A) terminate the suspension of liquidation 
                under section 733(d)(2), and
                  (B) release any bond or other security, and 
                refund any cash deposit, required under section 
                733(d)(1)(B).
    (i) Violation of Agreement.--
          (1) In general.--If the administering authority 
        determines that an agreement accepted under subsection 
        (b) or (c) is being, or has been, violated, or no 
        longer meets the requirements of such subsection (other 
        than the requirement, under subsection (c)(1), of 
        elimination of injury) and subsection (d), then, on the 
        date of publication of its determination it shall--
                  (A) suspend liquidation under section 
                733(d)(2) of unliquidated entries of the 
                merchandise made on the later of--
                          (i) the date which is 90 days before 
                        the date of publication of the notice 
                        of suspension of liquidation, or
                          (ii) the date on which the 
                        merchandise, the sale or export to the 
                        United States of which was in violation 
                        of the agreement, or under an agreement 
                        which no longer meets the requirements 
                        of subsections (b) and (d) or (c) and 
                        (d), was first entered, or withdrawn 
                        from warehouse, for consumption,
                  (B) if the investigation was not completed, 
                resume the investigation as if its affirmative 
                preliminary determination were made on the date 
                of its determination under this paragraph,
                  (C) if the investigation was completed under 
                subsection (g), issue an antidumping duty order 
                under section 736(a) effective with respect to 
                entries of merchandise liquidation of which was 
                suspended,
                  (D) if it considers the violation to be 
                intentional, notify the Commissioner of Customs 
                who shall take appropriate action under 
                paragraph (2), and
                  (E) notify the petitioner, interested parties 
                who are or were parties to the investigation, 
                and the Commission of its action under this 
                paragraph.
          (2) Intentional violation to be punished by civil 
        penalty.--Any person who intentionally violates an 
        agreement accepted by the administering authority under 
        subsection (b) or (c) shall be subject to a civil 
        penalty assessed in the same amount, in the same 
        manner, and under the same procedures, as the penalty 
        imposed for a fraudulent violation of section 592(a) of 
        this Act.
    (j) Determination Not To Take Agreement Into Account.--In 
making a final determination under section 735, or in 
conducting a review under section 751, in a case in which the 
administering authority has terminated a suspension of 
investigation under subsection (i)(1), or continued an 
investigation under subsection (g), the Commission and the 
administering authority shall consider all of the subject 
merchandise, without regard to the effect of any agreement 
under subsection (b) or (c).
    (k) Termination of Investigation Initiated by Administering 
Authority.--The administering authority may terminate any 
investigation initiated by the administering authority under 
section 732(a) after providing notice of such termination to 
all parties to the investigation.
    (l) Special Rule for Nonmarket Economy Countries.--
          (1) In general.--The administering authority may 
        suspend an investigation under this subtitle upon 
        acceptance of an agreement with a nonmarket economy 
        country to restrict the volume of imports into the 
        United States of the merchandise under investigation 
        only if the administering authority determines that--
                  (A) such agreement satisfies the requirements 
                of subsection (d), and
                  (B) will prevent the suppression or 
                undercutting of price levels of domestic 
                products by imports of the merchandise under 
                investigation.
          (2) Failure of Agreements.--If the administering 
        authority determines that an agreement accepted under 
        this subsection no longer prevents the suppression or 
        undercutting of domestic prices of merchandise 
        manufactured in the United States, the provisions of 
        subsection (i) shall apply.
    (m) Special Rule for Regional Industry Investigations.--
          (1) Suspension agreements.--If the Commission makes a 
        regional industry determination under section 
        771(4)(C), the administering authority shall offer 
        exporters of the subject merchandise who account for 
        substantially all exports of that merchandise for sale 
        in the region concerned the opportunity to enter into 
        an agreement described in subsection (b), (c), or (l).
          (2) Requirements for suspension agreements.--Any 
        agreement described in paragraph (1) shall be subject 
        to all the requirements imposed under this section for 
        other agreements under subsection (b), (c), or (l), 
        except that if the Commission makes a regional industry 
        determination described in paragraph (1) in the final 
        affirmative determination under section 735(b) but not 
        in the preliminary affirmative determination under 
        section 733(a), any agreement described in paragraph 
        (1) may be accepted within 60 days after the 
        antidumping order is published under section 736.
          (3) Effect of suspension agreement on antidumping 
        duty order.--If an agreement described in paragraph (1) 
        is accepted after the antidumping duty order is 
        published, the administering authority shall rescind 
        the order, refund any cash deposit and release any bond 
        or other security deposited under section 733(d)(1)(B), 
        and instruct the Customs Service that entries of the 
        subject merchandise that were made during the period 
        that the order was in effect shall be liquidated 
        without regard to antidumping duties.

SEC. 735. FINAL DETERMINATIONS.

    (a) Final Determinations by Administering Authority.--
          (1) General rule.--Within 75 days after the date of 
        its preliminary determination under section 733(b), the 
        administering authority shall make a final 
        determination of whether the subject merchandise is 
        being, or is likely to be, sold in the United States at 
        less than its fair value.
          (2) Extension of period for determination.--The 
        administering authority may postpone making the final 
        determination under paragraph (1) until not later than 
        the 135th day after the date on which it published 
        notice of its preliminary determination under section 
        733(b) if a request in writing for such a postponement 
        is made by--
                  (A) exporters who account for a significant 
                proportion of exports of the merchandise which 
                is the subject of the investigation, in a 
                proceeding in which the preliminary 
                determination by the administering authority 
                under section 733(b) was affirmative, or
                  (B) the petitioner, in a proceeding in which 
                the preliminary determination by the 
                administering authority under section 733(b) 
                was negative.
          (3) Critical circumstances determinations.--If the 
        final determination of the administering authority is 
        affirmative, then that determination, in any 
        investigation in which the presence of critical 
        circumstances has been alleged under section 733(e), 
        shall also contain a finding of whether--
                  (A)(i) there is a history of dumping and 
                material in jury by reason of dumped imports in 
                the United States or elsewhere of the subject 
                merchandise, or
                  (ii) the person by whom, or for whose 
                account, the merchandise was imported, knew or 
                should have known that the exporter was selling 
                the subject merchandise at less than its fair 
                value and that there would be material injury 
                by reason of such sales, and
                  (B) there have been massive imports of the 
                subject merchandise over a relatively short 
                period.
        Such findings may be affirmative even though the 
        preliminary determination under section 733(e)(1) was 
        negative.
          (4) De minimis dumping margin.--In making a 
        determination under this subsection, the administering 
        authority shall disregard any weighted average dumping 
        margin that is de minimis as defined in section 
        733(b)(3).
    (b) Final Determination by Commission.--
          (1) In general.--The Commission shall make a final 
        determination of whether--
                  (A) an industry in the United States--
                          (i) is materially injured, or
                          (ii) is threatened with material 
                        injury, or
                  (B) the establishment of an industry in the 
                United States is materially retarded,
        by reason of imports, or sales (or the likelihood of 
        sales) for importation, of the merchandise with respect 
        to which the administering authority has made an 
        affirmative determination under subsection (a)(1). If 
        the Commission determines that imports of the subject 
        merchandise are negligible, the investigation shall be 
        terminated.
          (2) Period for injury determination following 
        affirmative preliminary determination by administering 
        authority.--If the preliminary determination by the 
        administering authority under section 733(b) is 
        affirmative, then the Commission shall make the 
        determination required by paragraph (1) before the 
        later of--
                  (A) the 120th day after the day on which the 
                administering authority makes its affirmative 
                preliminary determination under section 733(b), 
                or
                  (B) the 45th day after the day on which the 
                administering authority makes its affirmative 
                final determination under subsection (a).
          (3) Period for injury determination following 
        negative preliminary determination by administering 
        authority.--If the preliminary determination by the 
        administering authority under section 733(b) is 
        negative, and its final determination under subsection 
        (a) is affirmative, then the final determination by the 
        Commission under this subsection shall be made within 
        75 days after the date of that affirmative final 
        determination.
          (4) Certain additional findings.--
                  (A) Commission standard for retroactive 
                application.--
                          (i) In general.--If the finding of 
                        the administering authority under 
                        subsection (a)(3) is affirmative, then 
                        the final determination of the 
                        Commission shall include a finding as 
                        to whether the imports subject to the 
                        affirmative determination under 
                        subsection (a)(3) are likely to 
                        undermine seriously the remedial effect 
                        of the antidumping duty order to be 
                        issued under section 736.
                          (ii) Factors to consider.--In making 
                        the evaluation under clause (i), the 
                        Commission shall consider, among other 
                        factors it considers relevant--
                                  (I) the timing and the volume 
                                of the imports,
                                  (II) a rapid increase in 
                                inventories of the imports, and
                                  (III) any other circumstances 
                                indicating that the remedial 
                                effect of the antidumping order 
                                will be seriously undermined.
                  (B) If the final determination of the 
                Commission is that there is no material injury 
                but that there is threat of material injury, 
                then its determination shall also include a 
                finding as to whether material injury by reason 
                of the imports of the merchandise with respect 
                to which the administering authority has made 
                an affirmative determination under subsection 
                (a) would have been found but for any 
                suspension of liquidation of entries of the 
                merchandise.
  (c) Effect of Final Determinations.--
          (1) Effect of affirmative determination by the 
        administering authority.--If the determination of the 
        administering authority under subsection (a) is 
        affirmative, then--
                  (A) the administering authority shall make 
                available to the Commission all information 
                upon which such determination was based and 
                which the Commission considers relevant to its 
                determination, under such procedures as the 
                administering authority and the Commission may 
                establish to prevent disclosure, other than 
                with the consent of the party providing it or 
                under protective order, of any information as 
                to which confidential treatment has been given 
                by the administering authority,
                  (B)(i) the administering authority shall--
                          (I) determine the estimated weighted 
                        average dumping margin for each 
                        exporter and producer individually 
                        investigated, and
                          (II) determine, in accordance with 
                        paragraph (5), the estimated all-others 
                        rate for all exporters and producers 
                        not individually investigated, and
                  (ii) the administering authority shall order 
                the posting of a cash deposit, bond, or other 
                security, as the administering authority deems 
                appropriate, for each entry of the subject 
                merchandise in an amount based on the estimated 
                weighted average dumping margin or the 
                estimated all-others rate, whichever is 
                applicable, and
                  (C) in cases where the preliminary 
                determination by the administering authority 
                under section 733(b) was negative, the 
                administering authority shall order the 
                suspension of liquidation under section 
                733(d)(2).
          (2) Issuance of order; effect of negative 
        determination.--If the determinations of the 
        administering authority and the Commission under 
        subsections (a)(1) and (b)(1) are affirmative, then the 
        administering authority shall issue an antidumping duty 
        order under section 736(a). If either of such 
        determinations is negative, the investigation shall be 
        terminated upon the publication of notice of that 
        negative determination and the administering authority 
        shall--
                  (A) terminate the suspension of liquidation 
                under section 703(d)(2), and
                  (B) release any bond or other security and 
                refund any cash deposit, required under section 
                733(d)(1)(B).
          (3) Effect of negative determinations under 
        subsections (a)(3) and (b)(4)(a).--If the determination 
        of the administering authority or the Commission under 
        subsection (a)(3) or (b)(4)(A), respectively, is 
        negative, then the administering authority shall--
                  (A) terminate any retroactive suspension of 
                liquidation required under paragraph (4) or 
                section 733(e)(2), and
                  (B) release any bond or other security, and 
                refund any cash deposit required, under section 
                733(d)(1)(B) with respect to entries of the 
                merchandise the liquidation of which was 
                suspended retroactively under section 
                733(e)(2).
          (4) Effect of affirmative determination under 
        subsection (a)(3).--If the determination of the 
        administering authority under subsection (a)(3) is 
        affirmative, then the administering authority shall--
                  (A) in cases where the preliminary 
                determinations by the administering authority 
                under sections 733(b) and 733(e)(1) were both 
                affirmative, continue the retroactive 
                suspension of liquidation and the posting of a 
                cash deposit, bond, or other security 
                previously ordered under section 733(e)(2);
                  (B) in cases where the preliminary 
                determination by the administering authority 
                under section 733(b) was affirmative, but the 
                preliminary determination under section 
                733(e)(1) was negative, shall modify any 
                suspension of liquidation and security 
                requirement previously ordered under section 
                733(d) to apply to unliquidated entries of 
                merchandise entered, or withdrawn from 
                warehouse, for consumption on or after the date 
                which is 90 days before the date on which 
                suspension of liquidation was first ordered; or
                  (C) in cases where the preliminary 
                determination by the administering authority 
                under section 733(b) was negative, shall apply 
                any suspension of liquidation and security 
                requirement ordered under subsection 
                735(c)(1)(B) to unliquidated entries of 
                merchandise entered, or withdrawn from 
                warehouse, for consumption on or after the date 
                which is 90 days before the date on which 
                suspension of liquidation is first ordered.
          (5) Method for determining estimated all-others 
        rate.--
                  (A) General rule.--For purposes of this 
                subsection and section 733(d), the estimated 
                all-others rate shall be an amount equal to the 
                weighted average of the estimated weighted 
                average dumping margins established for 
                exporters and producers individually 
                investigated, excluding any zero and de minimis 
                margins, and any margins determined entirely 
                under section 776.
                  (B) Exception.--If the estimated weighted 
                average dumping margins established for all 
                exporters and producers individually 
                investigated are zero or de minimis margins, or 
                are determined entirely under section 776, the 
                administering authority may use any reasonable 
                method to establish the estimated all-others 
                rate for exporters and producers not 
                individually investigated, including averaging 
                the estimated weighted average dumping margins 
                determined for the exporters and producers 
                individually investigated.
  (d) Publication of Notice of Determinations.--Whenever the 
administering authority or the Commission makes a determination 
under this section, it shall notify the petitioner, other 
parties to the investigation, and the other agency of its 
determination and of the facts and conclusions of law upon 
which the determination is based, and it shall publish notice 
of its determination in the Federal Register.
  (e) Correction of Ministerial Errors.--The administering 
authority shall establish procedures for the correction of 
ministerial errors in final determinations within a reasonable 
time after the determinations are issued under this section. 
Such procedures shall ensure opportunity for interested parties 
to present their views regarding any such errors. As used in 
this subsection, the term ``ministerial error'' includes errors 
in addition, subtraction, or other arithmetic function, 
clerical errors resulting from inaccurate copying, duplication, 
or the like, and any other type of unintentional error which 
the administering authority considers ministerial.

SEC. 736. ASSESSMENT OF DUTY.

  (a) Publication of Antidumping Duty Order.--Within 7 days 
after being notified by the Commission of an affirmative 
determination under section 735(b), the administering authority 
shall publish an antidumping duty order which--
          (1) directs customs officers to assess an antidumping 
        duty equal to the amount by which the normal value of 
        the merchandise exceeds the export price (or the 
        constructed export price) of the merchandise, within 6 
        months after the date on which the administering 
        authority receives satisfactory information upon which 
        the assessment may be based, but in no event later 
        than--
                  (A) 12 months after the end of the annual 
                accounting period of the manufacturer or 
                exporter within which the merchandise is 
                entered, or withdrawn from warehouse, for 
                consumption, or
                  (B) in the case of merchandise not sold prior 
                to its importation into the United States, 12 
                months after the end of the annual accounting 
                period of the manufacturer or exporter within 
                which it is sold in the United States to a 
                person who is not the exporter of that 
                merchandise,
          (2) includes a description of the subject 
        merchandise, in such detail as the administering 
        authority deems necessary, and
          (3) requires the deposit of estimated antidumping 
        duties pending liquidation of entries of merchandise at 
        the same time as estimated normal customs duties on 
        that merchandise are deposited.
  (b) Imposition of Duty.--
          (1) General rule.--If the Commission, in its final 
        determination under section 735(b), finds material 
        injury or threat of material injury which, but for the 
        suspension of liquidation under section 733(d)(2) would 
        have led to a finding of material injury, then entries 
        of the subject merchandise, the liquidation of which 
        has been suspended under section 733(d)(2), shall be 
        subject to the imposition of antidumping duties under 
        section 731.
          (2) Special rule.--If the Commission, in its final 
        determination under section 735(b), finds threat of 
        material injury, other than threat of material injury 
        described in paragraph (1), or material retardation of 
        the establishment of an industry in the United States, 
        then subject merchandise which is entered, or withdrawn 
        from warehouse, for consumption on or after the date of 
        publication of notice of an affirmative determination 
        of the Commission under section 735(b) shall be subject 
        to the assessment of antidumping duties under section 
        731, and the administering authority shall release any 
        bond or other security, and refund any cash deposit 
        made, to secure the payment of antidumping duties with 
        respect to entries of the merchandise entered, or 
        withdrawn from warehouse, for consumption before that 
        date.
  (c) Security in Lieu of Estimated Duty Pending Early 
Determination of Duty.--
          (1) Conditions for waiver of deposit of estimated 
        duties.--The administering authority may permit, for 
        not more than 90 days after the date of publication of 
        an order under subsection (a), the posting of a bond or 
        other security in lieu of the deposit of estimated 
        antidumping duties required under subsection (a)(3) 
        if--
                  (A) the investigation has not been designated 
                as extraordinarily complicated by reason of--
                          (i) the number and complexity of the 
                        transactions to be investigated or 
                        adjustments to be considered,
                          (ii) the novelty of the issues 
                        presented, or
                          (iii) the number of firms whose 
                        activities must be investigated,
                  (B) the final determination in the 
                investigation has not been postponed under 
                section 735(a)(2)(A);
                  (C) on the basis of information presented to 
                the administering authority by any 
                manufacturer, producer, or exporter in such 
                form and within such time as the administering 
                authority may require, the administering 
                authority is satisfied that a determination 
                will be made, within 90 days after the date of 
                publication of an order under subsection (a), 
                of the normal value and the export price (or 
                the constructed export price) for all 
                merchandise of such manufacturer, producer, or 
                exporter described in that order which was 
                entered, or withdrawn from warehouse, for 
                consumption on or after the date of publication 
                of--
                          (i) an affirmative preliminary 
                        determination by the administering 
                        authority under section 733(b), or
                          (ii) if its determination under 
                        section 733(b) was negative, an 
                        affirmative final determination by the 
                        administering authority under section 
                        735(a),
                and before the date of publication of the 
                affirmative final determination by the 
                Commission under section 735(b);
                  (D) the party described in subparagraph (C) 
                provides credible evidence that the amount by 
                which the normal value of the merchandise 
                exceeds the export price (or the constructed 
                export price) of the merchandise is 
                significantly less than the amount of such 
                excess specified in the antidumping duty order 
                published under subsection (a); and
                  (E) the data concerning the normal value and 
                the export price (or the constructed export 
                price) apply to sales in the usual commercial 
                quantities and in the ordinary course of trade 
                and the number of such sales are sufficient to 
                form an adequate basis for comparison.
          (2) Notice; hearing.--If the administering authority 
        permits the posting of a bond or other security in lieu 
        of the deposit of estimated antidumping duties under 
        paragraph (1), it shall--
                  (A) publish notice of its action in the 
                Federal Register, and
                  (B) upon the request of any interested party, 
                hold a hearing in accordance with section 774 
                before determining the normal value and the 
                export price (or the constructed export price) 
                of the merchandise.
          (3) Determinations to be basis of antidumping duty.--
        The administering authority shall publish notice in the 
        Federal Register of the results of its determination of 
        normal value and export price (or the constructed 
        export price), and that determination shall be the 
        basis for the assessment of antidumping duties on 
        entries of merchandise to which the notice under this 
        subsection applies and also shall be the basis for the 
        deposit of estimated antidumping duties on future 
        entries of merchandise of manufacturers, producers, or 
        exporters described in paragraph (1) to which the order 
        issued under subsection (a) applies.
          (4) Provision of business proprietary information; 
        written comments.--Before determining whether to permit 
        the posting of bond or other security under paragraph 
        (1) in lieu of the deposit of estimated antidumping 
        duties, the administering authority shall--
                  (A) make all business proprietary information 
                supplied to the administering authority under 
                paragraph (1) available under a protective 
                order in accordance with section 777(c) to all 
                interested parties described in subparagraph 
                (C), (D), (E), (F), or (G) of section 771(9), 
                and
                  (B) afford all interested parties an 
                opportunity to file written comments on whether 
                the posting of bond or other security under 
                paragraph (1) in lieu of the deposit of 
                estimated antidumping duties should be 
                permitted.
  (d) Special Rule for Regional Industries.--
          (1) In general.--In an investigation in which the 
        Commission makes a regional industry determination 
        under section 771(4)(C), the administering authority 
        shall, to the maximum extent possible, direct that 
        duties be assessed only on the subject merchandise of 
        the specific exporters or producers that exported the 
        subject merchandise for sale in the region concerned 
        during the period of investigation.
          (2) Exception for new exporters and producers.--After 
        publication of the antidumping duty order, if the 
        administering authority finds that a new exporter or 
        producer is exporting the subject merchandise for sale 
        in the region concerned, the administering authority 
        shall direct that duties be assessed on the subject 
        merchandise of the new exporter or producer consistent 
        with the provisions of section 751(a)(2)(B).

SEC. 737. TREATMENT OF DIFFERENCE BETWEEN DEPOSIT OF ESTIMATED 
                    ANTIDUMPING DUTY AND FINAL ASSESSED DUTY UNDER 
                    ANTIDUMPING DUTY ORDER.

  (a) Deposit of Estimated Antidumping Duty Under Section 
733(d)(1)(B).--If the amount of a cash deposit, or the amount 
of any bond or other security, required as security for an 
estimated antidumping duty under section 733(d)(1)(B) is 
different from the amount of the antidumping duty determined 
under an antidumping duty order published under section 736, 
then the difference for entries of merchandise entered, or 
withdrawn from warehouse, for consumption before notice of the 
affirmative determination of the Commission under section 
735(b) is published shall be--
          (1) disregarded, to the extent that the cash deposit, 
        bond, or other security collected is lower than the 
        duty under the order, or
          (2) refunded or released, to the extent that the cash 
        deposit, bond, or other security is higher than the 
        duty under the order.
  (b) Deposit of Estimated Antidumping Duty Under Section 
736(a)(3).--If the amount of an estimated antidumping duty 
deposited under section 736(a)(3) is different from the amount 
of the antidumping duty determined under an antidumping duty 
order published under section 736, then the difference for 
entries of merchandise entered, or withdrawn from warehouse, 
for consumption after notice of the affirmative determination 
of the Commission under section 735(b) is published shall be--
          (1) collected, to the extent that the deposit under 
        section 736(a)(3) is lower than the duty determined 
        under the order, or
          (2) refunded, to the extent that the deposit under 
        section 736(a)(3) is higher than the duty determined 
        under the order, together with interest as provided by 
        section 778.

SEC. 738. CONDITIONAL PAYMENT OF ANTIDUMPING DUTY.

  (a) General Rule.--For all entries, or withdrawals from 
warehouse, for consumption of merchandise subject to an 
antidumping duty order on or after the date of publication of 
such order, no customs officer may deliver merchandise of that 
class or kind to the person by whom or for whose account it was 
imported unless that person complies with the requirements of 
subsection (b) and deposits with the appropriate customs 
officer an estimated antidumping duty in an amount determined 
by the administering authority.
  (b) Importer Requirements.--In order to meet the requirements 
of this subsection, a person shall--
          (1) furnish, or arrange to have furnished, to the 
        appropriate customs officer such information as the 
        administering authority deems necessary for determining 
        the export price (or the constructed export price) of 
        the merchandise imported by or for the account of that 
        person, and such other information as the administering 
        authority deems necessary for ascertaining any 
        antidumping duty to be imposed under this title;
          (2) maintain and furnish to the customs officer such 
        records concerning the sale of the merchandise as the 
        administering authority, by regulation, requires;
          (3) state under oath before the customs officer that 
        he is not an exporter, or if he is an exporter, declare 
        under oath at the time of entry the constructed export 
        price of the merchandise to the customs officer if it 
        is then known, or, if not, so declare within 30 days 
        after the merchandise has been sold, or has been made 
        the subject of an agreement to be sold, in the United 
        States; and
          (4) pay, or agree to pay on demand, to the customs 
        officer the amount of antidumping duty imposed under 
        section 731 on that merchandise.

SEC. 739. ESTABLISHMENT OF PRODUCT CATEGORIES FOR SHORT LIFE CYCLE 
                    MERCHANDISE.

  (a) Establishment of Product Categories.--
          (1) Petitions.--
                  (A) In general.--An eligible domestic entity 
                may file a petition with the Commission 
                requesting that a product category be 
                established with respect to short life cycle 
                merchandise at any time after the merchandise 
                becomes the subject of 2 or more affirmative 
                dumping determinations.
                  (B) Contents.--A petition filed under 
                subparagraph (A) shall--
                          (i) identify the short life cycle 
                        merchandise that is the subject of the 
                        affirmative dumping determinations,
                          (ii) specify the short life cycle 
                        merchandise that the petitioner seeks 
                        to have included in the same product 
                        category as the merchandise that is 
                        subject to the affirmative dumping 
                        determinations,
                          (iii) specify any short life cycle 
                        merchandise the petitioner particularly 
                        seeks to have excluded from the product 
                        category,
                          (iv) provide reasons for the 
                        inclusions and exclusions specified 
                        under clauses (ii) and (iii), and
                          (v) identify such merchandise in 
                        terms of the designations used in the 
                        Harmonized Tariff Schedule of the 
                        United States.
          (2) Determinations on sufficiency of petition.--Upon 
        receiving a petition under paragraph (1), the 
        Commission shall--
                  (A) request the administering authority to 
                confirm promptly the affirmative determinations 
                on which the petition is based, and
                  (B) upon receipt of such confirmation, 
                determine whether the merchandise covered by 
                the confirmed affirmative determinations is 
                short life cycle merchandise and whether the 
                petitioner is an eligible domestic entity.
          (3) Notice; hearings.--If the determinations under 
        paragraph (2)(B) are affirmative, the Commission 
        shall--
                  (A) publish notice in the Federal Register 
                that the petition has been received, and
                  (B) provide opportunity for the presentation 
                of views regarding the establishment of the 
                requested product category, including a public 
                hearing if requested by any interested person.
          (4) Determinations.--
                  (A) In general.--By no later than the date 
                that is 90 days after the date on which a 
                petition is filed under paragraph (1), the 
                Commission shall determine the scope of the 
                product category into which the short life 
                cycle merchandise that is the subject of the 
                affirmative dumping determinations identified 
                in such petition shall be classified for 
                purposes of this section.
                  (B) Modifications not requested by 
                petition.--
                          (i) In general.--The Commission may, 
                        on its own initiative, make a 
                        determination modifying the scope of 
                        any product category established under 
                        subparagraph (A) at any time.
                          (ii) Notice and hearing.--
                        Determinations may be made under clause 
                        (i) only after the Commission has--
                                  (I) published in the Federal 
                                Register notice of the proposed 
                                modification, and
                                  (II) provided interested 
                                parties an opportunity for a 
                                hearing, and a period for the 
                                submission of written comments, 
                                on the classification of 
                                merchandise into the product 
                                categories to be affected by 
                                such determination.
                  (C) Basis of determinations.--In making 
                determinations under subparagraph (A) or (B), 
                the Commission shall ensure that each product 
                category consists of similar short life cycle 
                merchandise which is produced by similar 
                processes under similar circumstances and has 
                similar uses.
  (b) Definitions.--For purposes of this section--
          (1) Eligible domestic entity.--The term ``eligible 
        domestic entity'' means a manufacturer or producer in 
        the United States, or a certified union or recognized 
        union or group of workers which is representative of an 
        industry in the United States, that manufactures or 
        produces short life cycle merchandise that is--
                  (A) like or directly competitive with other 
                merchandise that is the subject of 2 or more 
                affirmative dumping determinations, or
                  (B) is similar enough to such other 
                merchandise as to be considered for inclusion 
                with such merchandise in a product monitoring 
                category established under this section.
          (2) Affirmative dumping determination.--The term 
        ``affirmative dumping determination'' means--
                  (A) any affirmative final determination made 
                by the administering authority under section 
                735(a) during the 8-year period preceding the 
                filing of the petition under this section that 
                results in the issuance of an antidumping duty 
                order under section 736 which requires the 
                deposit of estimated antidumping duties at a 
                rate of not less than 15 percent ad valorem, or
                  (B) any affirmative preliminary determination 
                that--
                          (i) is made by the administering 
                        authority under section 733(b) during 
                        the 8-year period preceding the filing 
                        of the petition under this section in 
                        the course of an investigation for 
                        which no final determination is made 
                        under section 735 by reason of a 
                        suspension of the investigation under 
                        section 734, and
                          (ii) includes a determination that 
                        the estimated average amount by which 
                        the normal value of the merchandise 
                        exceeds the export price (or the 
                        constructed export price) of the 
                        merchandise is not less than 15 percent 
                        ad valorem.
          (3) Subject of affirmative dumping determination.--
                  (A) In general.--Short life cycle merchandise 
                of a manufacturer shall be treated as being the 
                subject of an affirmative dumping determination 
                only if the administering authority--
                          (i) makes a separate determination of 
                        the amount by which the normal value of 
                        such merchandise of the manufacturer 
                        exceeds the export price (or the 
                        constructed export price) of such 
                        merchandise of the manufacturer, and
                          (ii) specifically identifies the 
                        manufacturer by name with such amount 
                        in the affirmative dumping 
                        determination or in an antidumping duty 
                        order issued as a result of the 
                        affirmative dumping determination.
                  (B) Exclusion.--Short life cycle merchandise 
                of a manufacturer shall not be treated as being 
                the subject of an affirmative dumping 
                determination if--
                          (i) such merchandise of the 
                        manufacturer is part of a group of 
                        merchandise to which the administering 
                        authority assigns (in lieu of making 
                        separate determinations described in 
                        subparagraph (A)(i)(I)) an amount 
                        determined to be the amount by which 
                        the normal value of the merchandise in 
                        such group exceeds the export price (or 
                        the constructed export price) of the 
                        merchandise in such group, and
                          (ii) the merchandise and the 
                        manufacturer are not specified by name 
                        in the affirmative dumping 
                        determination or in any antidumping 
                        duty order issued as a result of such 
                        affirmative dumping determination.
          (4) Short life cycle merchandise.--That term ``short 
        life cycle merchandise'' means any product that the 
        Commission determines is likely to become outmoded 
        within 4 years, by reason of technological advances, 
        after the product is commercially available. For 
        purposes of this paragraph, the term ``outmoded'' 
        refers to a kind of style that is no longer state-of-
        the-art.
  (c) Transitional Rules.--
          (1) For purposes of this section and section 
        733(b)(1) (B) and (C), all affirmative dumping 
        determinations described in subsection (b)(2)(A) that 
        were made after December 31, 1980, and before the date 
        of enactment of the Omnibus Trade and Competitiveness 
        Act of 1988, and all affirmative dumping determinations 
        described in subsection (b)(2)(B) that were made after 
        December 31, 1984, and before the date of enactment of 
        such Act, with respect to each category of short life 
        cycle merchandise of the same manufacturer shall be 
        treated as one affirmative dumping determination with 
        respect to that category for that manufacturer which 
        was made on the date on which the latest of such 
        determinations was made.
          (2) No affirmative dumping determination that--
                  (A) is described in subsection (b)(2)(A) and 
                was made before January 1, 1981, or
                  (B) is described in subsection (b)(2)(B) and 
                was made before January 1, 1985,
        may be taken into account under this section or section 
        733(b)(1) (B) and (C).

   3. Administrative Review of Antidumping and Countervailing Duties


Subtitle C of Title VII (Sections 751, 752, 761, and 762) of the Tariff 
                        Act of 1930, as amended


 [19 U.S.C. 1675, 1675a, 1676, 1676a; P.L. 71-361, as amended, by P.L. 
    96-39, P.L. 98-573, P.L. 100-418, P.L. 103-465, and P.O. 106-36]

     Chapter 1--Review of Amount of Duty and Agreements Other Than 
                  Quantitative Restriction Agreements


SEC. 751. ADMINISTRATIVE REVIEW OF DETERMINATIONS.

  (a) Periodic Review of Amount of Duty.--
          (1) In general.--At least once during each 12-month 
        period beginning on the anniversary of the date of 
        publication of a countervailing duty order under this 
        title or under section 303 of this Act, an antidumping 
        duty order under this title or a finding under the 
        Antidumping Act, 1921, or a notice of the suspension of 
        an investigation, the administering authority, if a 
        request for such a review has been received and after 
        publication of notice of such review in the Federal 
        Register, shall--
                  (A) review and determine the amount of any 
                net countervailable subsidy,
                  (B) review, and determine (in accordance with 
                paragraph (2)), the amount of any antidumping 
                duty, and
                  (C) review the current status of, and 
                compliance with, any agreement by reason of 
                which an investigation was suspended, and 
                review the amount of any net countervailable 
                subsidy or dumping margin involved in the 
                agreement,
        and shall publish in the Federal Register the results 
        of such review, together with notice of any duty to be 
        assessed, estimated duty to be deposited, or 
        investigation to be resumed.
          (2) Determination of antidumping duties.--
                  (A) In general.--For the purpose of paragraph 
                (1)(B), the administering authority shall 
                determine--
                          (i) the normal value and export price 
                        (or constructed export price) of each 
                        entry of the subject merchandise, and
                          (ii) the dumping margin for each such 
                        entry.
                  (B) Determination of antidumping or 
                countervailing duties for new exporters and 
                producers.--
                          (i) In general.--If the administering 
                        authority receives a request from an 
                        exporter or producer of the subject 
                        merchandise establishing that--
                                  (I) such exporter or producer 
                                did not export the merchandise 
                                that was the subject of an 
                                antidumping duty or 
                                countervailing duty order to 
                                the United States (or, in the 
                                case of a regional industry, 
                                did not export the subject 
                                merchandise for sale in the 
                                region concerned) during the 
                                period of investigation, and
                                  (II) such exporter or 
                                producer is not affiliated 
                                (within the meaning of section 
                                771(33)) with any exporter or 
                                producer who exported the 
                                subject merchandise to the 
                                United States (or in the case 
                                of a regional industry, who 
                                exported the subject 
                                merchandise for sale in the 
                                region concerned) during that 
                                period,
                        the administering authority shall 
                        conduct a review under this subsection 
                        to establish an individual weighted 
                        average dumping margin or an individual 
                        countervailing duty rate (as the case 
                        may be) for such exporter or producer.
                          (ii) Time for review under clause 
                        (i).--The administering authority shall 
                        commence a review under clause (i) in 
                        the calendar month beginning after--
                                  (I) the end of the 6-month 
                                period beginning on the date of 
                                the countervailing duty or 
                                antidumping duty order under 
                                review, or
                                  (II) the end of any 6-month 
                                period occurring thereafter,
                        if the request for the review is made 
                        during that 6-month period.
                          (iii) Posting bond or security.--The 
                        administering authority shall, at the 
                        time a review under this subparagraph 
                        is initiated, direct the Customs 
                        Service to allow, at the option of the 
                        importer, the posting, until the 
                        completion of the review, of a bond or 
                        security in lieu of a cash deposit for 
                        each entry of the subject merchandise.
                          (iv) Time limits.--The administering 
                        authority shall make a preliminary 
                        determination in a review conducted 
                        under this subparagraph within 180 days 
                        after the date on which the review is 
                        initiated, and a final determination 
                        within 90 days after the date the 
                        preliminary determination is issued, 
                        except that if the administering 
                        authority concludes that the case is 
                        extraordinarily complicated, it may 
                        extend the 180-day period to 300 days 
                        and may extend the 90-day period to 150 
                        days.
                  (C) Results of determinations.--The 
                determination under this paragraph shall be the 
                basis for the assessment of countervailing or 
                antidumping duties on entries of merchandise 
                covered by the determination and for deposits 
                of estimated duties.
          (3) Time limits.--
                  (A) Preliminary and final determinations.--
                The administering authority shall make a 
                preliminary determination under subparagraph 
                (A), (B), or (C) of paragraph (1) within 245 
                days after the last day of the month in which 
                occurs the anniversary of the date of 
                publication of the order, finding, or 
                suspension agreement for which the review under 
                paragraph (1) is requested, and a final 
                determination under paragraph (1) within 120 
                days after the date on which the preliminary 
                determination is published. If it is not 
                practicable to complete the review within the 
                foregoing time, the administering authority may 
                extend that 245-day period to 365 days and may 
                extend that 120-day period to 180 days. The 
                administering authority may extend the time for 
                making a final determination without extending 
                the time for making a preliminary 
                determination, if such final determination is 
                made not later than 300 days after the date on 
                which the preliminary determination is 
                published.
                  (B) Liquidation of entries.--If the 
                administering authority orders any liquidation 
                of entries pursuant to a review under paragraph 
                (1), such liquidation shall be made promptly 
                and, to the greatest extent practicable, within 
                90 days after the instructions to Customs are 
                issued. In any case in which liquidation has 
                not occurred within that 90-day period, the 
                Secretary of the Treasury shall, upon the 
                request of the affected party, provide an 
                explanation thereof.
                  (C) Effect of pending review under section 
                516a.--In a case in which a final determination 
                under paragraph (1) is under review under 
                section 516A and a liquidation of entries 
                covered by the determination is enjoined under 
                section 516A(c)(2) or suspended under section 
                516A(g)(5)(C), the administering authority 
                shall, within 10 days after the final 
                disposition of the review under section 516A, 
                transmit to the Federal Register for 
                publication the final disposition and issue 
                instructions to the Customs Service with 
                respect to the liquidation of entries pursuant 
                to the review. In such a case, the 90-day 
                period referred to in subparagraph (B) shall 
                begin on the day on which the administering 
                authority issues such instructions.
          (4) Absorption of antidumping duties.--During any 
        review under this subsection initiated 2 years or 4 
        years after the publication of an antidumping duty 
        order under section 736(a), the administering 
        authority, if requested, shall determine whether 
        antidumping duties have been absorbed by a foreign 
        producer or exporter subject to the order if the 
        subject merchandise is sold in the United States 
        through an importer who is affiliated with such foreign 
        producer or exporter. The administering authority shall 
        notify the Commission of its findings regarding such 
        duty absorption for the Commission to consider in 
        conducting a review under subsection (c).
  (b) Reviews Based on Changed Circumstances.--
          (1) In general.--Whenever the administering authority 
        or the Commission receives information concerning, or a 
        request from an interested party for a review of--
                  (A) a final affirmative determination that 
                resulted in an antidumping duty order under 
                this title or a finding under the Antidumping 
                Act, 1921, or in a countervailing duty order 
                under this title or section 303,
                  (B) a suspension agreement accepted under 
                section 704 or 734, or
                  (C) a final affirmative determination 
                resulting from an investigation continued 
                pursuant to section 704(g) or 734(g),
        which shows changed circumstances sufficient to warrant 
        a review of such determination or agreement, the 
        administering authority or the Commission (as the case 
        may be) shall conduct a review of the determination or 
        agreement after publishing notice of the review in the 
        Federal Register.
          (2) Commission review.--In conducting a review under 
        this subsection, the Commission shall--
                  (A) in the case of a countervailing duty 
                order or antidumping duty order or finding, 
                determine whether revocation of the order or 
                finding is likely to lead to continuation or 
                recurrence of material injury,
                  (B) in the case of a determination made 
                pursuant to section 704(h)(2) or 734(h)(2), 
                determine whether the suspension agreement 
                continues to eliminate completely the injurious 
                effects of imports of the subject merchandise, 
                and
                  (C) in the case of an affirmative 
                determination resulting from an investigation 
                continued under section 704(g) or 734(g), 
                determine whether termination of the suspended 
                investigation is likely to lead to continuation 
                or recurrence of material injury.
          (3)  Burden of persuasion.--During a review conducted 
        by the Commission under this subsection--
                  (A) the party seeking revocation of an order 
                or finding described in paragraph (1)(A) shall 
                have the burden of persuasion with respect to 
                whether there are changed circumstances 
                sufficient to warrant such revocation, and
                  (B) the party seeking termination of a 
                suspended investigation or a suspension 
                agreement shall have the burden of persuasion 
                with respect to whether there are changed 
                circumstances sufficient to warrant such 
                termination.
          (4) Limitation on period for review.--In the absence 
        of good cause shown--
                  (A) the Commission may not review a 
                determination made under section 705(b) or 
                735(b), or an investigation suspended under 
                section 704 or 734, and
                  (B) the administering authority may not 
                review a determination made under section 
                705(a) or 735(a), or an investigation suspended 
                under section 704 or 734,
        less than 24 months after the date of publication of 
        notice of that determination or suspension.
  (c) Five-Year Review.--
          (1) In general.--Notwithstanding subsection (b) and 
        except in the case of a transition order defined in 
        paragraph (6), 5 years after the date of publication 
        of--
                  (A) a countervailing duty order (other than a 
                countervailing duty order to which subparagraph 
                (B) applies or which was issued without an 
                affirmative determination of injury by the 
                Commission under section 303), an antidumping 
                duty order, or a notice of suspension of an 
                investigation, described in subsection (a)(1),
                  (B) a notice of injury determination under 
                section 753 with respect to a countervailing 
                duty order, or
                  (C) a determination under this section to 
                continue an order or suspension agreement,
        the administering authority and the Commission shall 
        conduct a review to determine, in accordance with 
        section 752, whether revocation of the countervailing 
        or antidumping duty order or termination of the 
        investigation suspended under section 704 or 734 would 
        be likely to lead to continuation or recurrence of 
        dumping or a countervailable subsidy (as the case may 
        be) and of material injury.
          (2) Notice of initiation of review.--Not later than 
        30 days before the fifth anniversary of the date 
        described in paragraph (1), the administering authority 
        shall publish in the Federal Register a notice of 
        initiation of a review under this subsection and 
        request that interested parties submit--
                  (A) a statement expressing their willingness 
                to participate in the review by providing 
                information requested by the administering 
                authority and the Commission,
                  (B) a statement regarding the likely effects 
                of revocation of the order or termination of 
                the suspended investigation, and
                  (C) such other information or industry data 
                as the administering authority or the 
                Commission may specify.
          (3) Responses to notice of initiation.--
                  (A) No response.--If no interested party 
                responds to the notice of initiation under this 
                subsection, the administering authority shall 
                issue a final determination, within 90 days 
                after the initiation of a review, revoking the 
                order or terminating the suspended 
                investigation to which such notice relates. For 
                purposes of this paragraph, an interested party 
                means a party described in section 771(9) (C), 
                (D), (E), (F), or (G).
                  (B) Inadequate response.--If interested 
                parties provide inadequate responses to a 
                notice of initiation, the administering 
                authority, within 120 days after the initiation 
                of the review, or the Commission, within 150 
                days after such initiation, may issue, without 
                further investigation, a final determination 
                based on the facts available, in accordance 
                with section 776.
          (4) Waiver of participation by certain interested 
        parties.--
                  (A) In general.--An interested party 
                described in section 771(9) (A) or (B) may 
                elect not to participate in a review conducted 
                by the administering authority under this 
                subsection and to participate only in the 
                review conducted by the Commission under this 
                subsection.
                  (B) Effect of waiver.--In a review in which 
                an interested party waives its participation 
                pursuant to this paragraph, the administering 
                authority shall conclude that revocation of the 
                order or termination of the investigation would 
                be likely to lead to continuation or recurrence 
                of dumping or a countervailable subsidy (as the 
                case may be) with respect to that interested 
                party.
          (5) Conduct of review.--
                  (A) Time limits for completion of review.--
                Unless the review has been completed pursuant 
                to paragraph (3) or paragraph (4) applies, the 
                administering authority shall make its final 
                determination pursuant to section 752 (b) or 
                (c) within 240 days after the date on which a 
                review is initiated under this subsection. If 
                the administering authority makes a final 
                affirmative determination, the Commission shall 
                make its final determination pursuant to 
                section 752(a) within 360 days after the date 
                on which a review is initiated under this 
                subsection.
                  (B) Extension of time limit.--The 
                administering authority or the Commission (as 
                the case may be) may extend the period of time 
                for making their respective determinations 
                under this subsection by not more than 90 days, 
                if the administering authority or the 
                Commission (as the case may be) determines that 
                the review is extraordinarily complicated. In a 
                review in which the administering authority 
                extends the time for making a final 
                determination, but the Commission does not 
                extend the time for making a determination, the 
                Commission's determination shall be made not 
                later than 120 days after the date on which the 
                final determination of the administering 
                authority is published.
                  (C) Extraordinarily complicated.--For 
                purposes of this subsection, the administering 
                authority or the Commission (as the case may 
                be) may treat a review as extraordinarily 
                complicated if--
                          (i) there is a large number of 
                        issues,
                          (ii) the issues to be considered are 
                        complex,
                          (iii) there is a large number of 
                        firms involved,
                          (iv) the orders or suspended 
                        investigations have been grouped as 
                        described in subparagraph (D), or
                          (v) it is a review of a transition 
                        order.
                  (D) Grouped reviews.--The Commission, in 
                consultation with the administering authority, 
                may group orders or suspended investigations 
                for review if it considers that such grouping 
                is appropriate and will promote administrative 
                efficiency. Where orders or suspended 
                investigations have been grouped, the 
                Commission shall, subject to subparagraph (B), 
                make its final determination under this 
                subsection not later than 120 days after the 
                date that the administering authority publishes 
                notice of its final determination with respect 
                to the last order or agreement in the group.
          (6) Special transition rules.--
                  (A) Schedule for reviews of transition 
                orders.--
                          (i) Initiation.--The administering 
                        authority shall begin its review of 
                        transition orders in the 42d calendar 
                        month after the date such orders are 
                        issued. A review of all transition 
                        orders shall be initiated not later 
                        than the 5th anniversary after the date 
                        such orders are issued.
                          (ii) Completion.--A review of a 
                        transition order shall be completed not 
                        later than 18 months after the date 
                        such review is initiated. Reviews of 
                        all transition orders shall be 
                        completed not later than 18 months 
                        after the 5th anniversary of the date 
                        such orders are issued.
                          (iii) Subsequent reviews.--The time 
                        limits set forth in clauses (i) and 
                        (ii) shall be applied to all subsequent 
                        5-year reviews of transition orders by 
                        substituting ``date of the 
                        determination to continue such orders'' 
                        for ``date such orders are issued''.
                          (iv) Revocation and termination.--No 
                        transition order may be revoked under 
                        this subsection before the date that is 
                        5 years after the date the WTO 
                        Agreement enters into force with 
                        respect to the United States.
                  (B) Sequence of transition reviews.--The 
                administering authority, in consultation with 
                the Commission, shall determine such sequence 
                of review of transition orders as it deems 
                appropriate to promote administrative 
                efficiency. To the extent practicable, older 
                orders shall be reviewed first.
                  (C) Definition of transition order.--For 
                purposes of this section, the term ``transition 
                order'' means--
                          (i) a countervailing duty order under 
                        this title or under section 303,
                          (ii) an antidumping duty order under 
                        this title or a finding under the 
                        Antidumping Act, 1921, or
                          (iii) a suspension of an 
                        investigation under section 704 or 734,
                which is in effect on the date the WTO 
                Agreement enters into force with respect to the 
                United States.
                  (D) Issue date for transition orders.--For 
                purposes of this subsection, a transition order 
                shall be treated as issued on the date the WTO 
                Agreement enters into force with respect to the 
                United States, if such order is based on an 
                investigation conducted by both the 
                administering authority and the Commission.
          (7) Exclusions from computations.--
                  (A) In general.--Subject to subparagraph (B), 
                there shall be excluded from the computation of 
                the 5-year period described in paragraph (1) 
                and the periods described in paragraph (6) and 
                period during which the importation of the 
                subject merchandise is prohibited on account of 
                the imposition, under the International 
                Emergency Economic Powers Act or other 
                provision of law, of sanctions by the United 
                States against the country in which the subject 
                merchandise originates.
                  (b) Application of exclusion.--Subparagraph 
                (A) shall apply only with respect to subject 
                merchandise which originates in a country that 
                is not a WTO member.
  (d) Revocation of Order or Finding; Termination of Suspended 
Investigation.--
          (1) In general.--The administering authority may 
        revoke, in whole or in part, a countervailing duty 
        order or an antidumping duty order or finding, or 
        terminate a suspended investigation, after review under 
        subsection (a) or (b). The administering authority 
        shall not revoke, in whole or in part, a countervailing 
        duty order or terminate a suspended investigation on 
        the basis of any export taxes, duties, or other charges 
        levied on the export of the subject merchandise to the 
        United States which are specifically intended to offset 
        the countervailable subsidy received.
          (2) Five-year reviews.--In the case of a review 
        conducted under subsection (c), the administering 
        authority shall revoke a countervailing duty order or 
        an antidumping duty order or finding, or terminate a 
        suspended investigation, unless--
                  (A) the administering authority makes a 
                determination that dumping or a countervailable 
                subsidy, as the case may be, would be likely to 
                continue or recur, and
                  (B) the Commission makes a determination that 
                material injury would be likely to continue or 
                recur as described in section 752(a).
          (3) Application of revocation or termination.--A 
        determination under this section to revoke an order or 
        finding or terminate a suspended investigation shall 
        apply with respect to unliquidated entries of the 
        subject merchandise which are entered, or withdrawn 
        from warehouse, for consumption on or after the date 
        determined by the administering authority.
  (e) Hearings.--Whenever the administering authority or the 
Commission conducts a review under this section, it shall, upon 
the request of an interested party, hold a hearing in 
accordance with section 774(b) in connection with that review.
  (f) Determination That Basis for Suspension No Longer 
Exists.--If the determination of the Commission under 
subsection (b)(2)(B) is negative, the suspension agreement 
shall be treated as not accepted, beginning on the date of 
publication of the Commission's determination, and the 
administering authority and the Commission shall proceed, under 
section 704(i) or 734(i), as if the suspension agreement had 
been violated on that date, except that no duty under any order 
subsequently issued shall be assessed on merchandise entered, 
or withdrawn from warehouse, for consumption before that date.
  (g) Reviews To Implement Results of Subsidies Enforcement 
Proceeding.--
          (1) Violations of article 8 of the subsidies 
        agreement.--If--
                  (A) the administering authority receives 
                notice from the Trade Representative of a 
                violation of Article 8 of the Subsidies 
                Agreement,
                  (B) the administering authority has reason to 
                believe that merchandise subject to an existing 
                countervailing duty order or suspended 
                investigation is benefiting from the subsidy or 
                subsidy program found to have been in violation 
                of Article 8 of the Subsidies Agreement, and
                  (C) no review pursuant to subsection (a)(1) 
                is in progress,
        the administering authority shall conduct a review of 
        the order or suspended investigation to determine 
        whether the subject merchandise benefits from the 
        subsidy or subsidy program found to have been in 
        violation of Article 8 of the Subsidies Agreement. If 
        the administering authority determines that the subject 
        merchandise is benefiting from the subsidy or subsidy 
        program, it shall make appropriate adjustments in the 
        estimated duty to be deposited or appropriate revisions 
        to the terms of the suspension agreement.\5\
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    \5\ Article 8 of the Uruguary Round Subsidies Agreement lapsed 
January 1, 2000.
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          (2) Withdrawal of subsidy or imposition of 
        countermeasures.--If the Trade Representative notifies 
        the administering authority that, pursuant to Article 4 
        or Article 7 of the Subsidies Agreement--
                  (A)(i) the United States has imposed 
                countermeasures, and
                  (ii) such countermeasures are based on the 
                effects in the United States of imports of 
                merchandise that is the subject of a 
                countervailing duty order, or
                  (B) a WTO member country has withdrawn a 
                countervailable subsidy provided with respect 
                to merchandise subject to a countervailing duty 
                order,
        the administering authority shall conduct a review to 
        determine if the amount of the estimated duty to be 
        deposited should be adjusted or the order should be 
        revoked.
          (3) Expedited review.--The administering authority 
        shall conduct reviews under this subsection on an 
        expedited basis, and shall publish the results of such 
        reviews in the Federal Register.
  (h) Correction of Ministerial Errors.--The administering 
authority shall establish procedures for the correction of 
ministerial errors in final determinations within a reasonable 
time after the determinations are issued under this section. 
Such procedures shall ensure opportunity for interested parties 
to present their views regarding any such errors. As used in 
this subsection, the term ``ministerial error'' includes errors 
in addition, subtraction, or other arithmetic function, 
clerical errors resulting from inaccurate copying, duplication, 
or the like, and any other type of unintentional error which 
the administering authority considers ministerial.

SEC. 752. SPECIAL RULES FOR SECTION 751(B) AND 751(C) REVIEWS.

  (a) Determination of Likelihood of Continuation or Recurrence 
of Material Injury.--
          (1) In general.--In a review conducted under section 
        751 (b) or (c), the Commission shall determine whether 
        revocation of an order, or termination of a suspended 
        investigation, would be likely to lead to continuation 
        or recurrence of material injury within a reasonably 
        foreseeable time. The Commission shall consider the 
        likely volume, price effect, and impact of imports of 
        the subject merchandise on the industry if the order is 
        revoked or the suspended investigation is terminated. 
        The Commission shall take into account--
                  (A) its prior injury determinations, 
                including the volume, price effect, and impact 
                of imports of the subject merchandise on the 
                industry before the order was issued or the 
                suspension agreement was accepted,
                  (B) whether any improvement in the state of 
                the industry is related to the order or the 
                suspension agreement,
                  (C) whether the industry is vulnerable to 
                material injury if the order is revoked or the 
                suspension agreement is terminated, and
                  (D) in an antidumping proceeding under 
                section 751(c), the findings of the 
                administering authority regarding duty 
                absorption under section 751(a)(4).
          (2) Volume.--In evaluating the likely volume of 
        imports of the subject merchandise if the order is 
        revoked or the suspended investigation is terminated, 
        the Commission shall consider whether the likely volume 
        of imports of the subject merchandise would be 
        significant if the order is revoked or the suspended 
        investigation is terminated, either in absolute terms 
        or relative to production or consumption in the United 
        States. In so doing, the Commission shall consider all 
        relevant economic factors, including--
                  (A) any likely increase in production 
                capacity or existing unused production capacity 
                in the exporting country,
                  (B) existing inventories of the subject 
                merchandise, or likely increases in 
                inventories,
                  (C) the existence of barriers to the 
                importation of such merchandise into countries 
                other than the United States, and
                  (D) the potential for product-shifting if 
                production facilities in the foreign country, 
                which can be used to produce the subject 
                merchandise, are currently being used to 
                produce other products.
          (3) Price.--In evaluating the likely price effects of 
        imports of the subject merchandise if the order is 
        revoked or the suspended investigation is terminated, 
        the Commission shall consider whether--
                  (A) there is likely to be significant price 
                underselling by imports of the subject 
                merchandise as compared to domestic like 
                products, and
                  (B) imports of the subject merchandise are 
                likely to enter the United States at prices 
                that otherwise would have a significant 
                depressing or suppressing effect on the price 
                of domestic like products.
          (4) Impact on the industry.--In evaluating the likely 
        impact of imports of the subject merchandise on the 
        industry if the order is revoked or the suspended 
        investigation is terminated, the Commission shall 
        consider all relevant economic factors which are likely 
        to have a bearing on the state of the industry in the 
        United States, including, but not limited to--
                  (A) likely declines in output, sales, market 
                share, profits, productivity, return on 
                investments, and utilization of capacity,
                  (B) likely negative effects on cash flow, 
                inventories, employment, wages, growth, ability 
                to raise capital, and investment, and
                  (C) likely negative effects on the existing 
                development and production efforts of the 
                industry, including efforts to develop a 
                derivative or more advanced version of the 
                domestic like product.
        The Commission shall evaluate all relevant economic 
        factors described in this paragraph within the context 
        of the business cycle and the conditions of competition 
        that are distinctive to the affected industry.
          (5) Basis for determination.--The presence or absence 
        of any factor which the Commission is required to 
        consider under this subsection shall not necessarily 
        give decisive guidance with respect to the Commission's 
        determination of whether material injury is likely to 
        continue or recur within a reasonably foreseeable time 
        if the order is revoked or the suspended investigation 
        is terminated. In making that determination, the 
        Commission shall consider that the effects of 
        revocation or termination may not be imminent, but may 
        manifest themselves only over a longer period of time.
          (6) Magnitude of margin of dumping and net 
        countervailable subsidy; nature of countervailable 
        subsidy.--In making a determination under section 751 
        (b) or (c), the Commission may consider the magnitude 
        of the margin of dumping or the magnitude of the net 
        countervailable subsidy. If a countervailable subsidy 
        is involved the Commission shall consider information 
        regarding the nature of the countervailable subsidy and 
        whether the subsidy is a subsidy described in Article 3 
        or 6.1 of the Subsidies Agreement.\6\
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    \6\ Article 6.1 of the Uruguary Round Subsidies Agreement lapsed 
January 1, 2000.
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          (7) Cumulation.--For purposes of this subsection, the 
        Commission may cumulatively assess the volume and 
        effect of imports of the subject merchandise from all 
        countries with respect to which reviews under section 
        751 (b) or (c) were initiated on the same day, if such 
        imports would be likely to compete with each other and 
        with domestic like products in the United States 
        market. The Commission shall not cumulatively assess 
        the volume and effects of imports of the subject 
        merchandise in a case in which it determines that such 
        imports are likely to have no discernible adverse 
        impact on the domestic industry.
          (8) Special rule for regional industries.--In a 
        review under section 751 (b) or (c) involving a 
        regional industry, the Commission may base its 
        determination on the regional industry defined in the 
        original investigation under this title, another region 
        that satisfies the criteria established in section 
        771(4)(C), or the United States as a whole. In 
        determining if a regional industry analysis is 
        appropriate for the determination in the review, the 
        Commission shall consider whether the criteria 
        established in section 771(4)(C) are likely to be 
        satisfied if the order is revoked or the suspended 
        investigation is terminated.
  (b) Determination of Likelihood of Continuation or Recurrence 
of a Countervailable Subsidy.--
          (1) In general.--In a review conducted under section 
        751(c), the administering authority shall determine 
        whether revocation of a countervailing duty order or 
        termination of a suspended investigation under section 
        704 would be likely to lead to continuation or 
        recurrence of a countervailable subsidy. The 
        administering authority shall consider--
                  (A) the net countervailable subsidy 
                determined in the investigation and subsequent 
                reviews, and
                  (B) whether any change in the program which 
                gave rise to the net countervailable subsidy 
                described in subparagraph (A) has occurred that 
                is likely to affect that net countervailable 
                subsidy.
          (2) Consideration of other factors.--If good cause is 
        shown, the administering authority shall also 
        consider--
                  (A) programs determined to provide 
                countervailable subsidies in other 
                investigations or reviews under this title, but 
                only to the extent that such programs--
                          (i) can potentially be used by the 
                        exporters or producers subject to the 
                        review under section 751(c), and
                          (ii) did not exist at the time that 
                        the countervailing duty order was 
                        issued or the suspension agreement was 
                        accepted, and
                  (B) programs newly alleged to provide 
                countervailable subsidies but only to the 
                extent that the administering authority makes 
                an affirmative countervailing duty 
                determination with respect to such programs and 
                with respect to the exporters or producers 
                subject to the review.
          (3) Net countervailable subsidy.--The administering 
        authority shall provide to the Commission the net 
        countervailable subsidy that is likely to prevail if 
        the order is revoked or the suspended investigation is 
        terminated. The administering authority shall normally 
        choose a net countervailable subsidy that was 
        determined under section 705 or subsection (a) or 
        (b)(1) of section 751.
          (4) Special rule.--
                  (A) Treatment of zero and de minimis rates.--
                A net countervailable subsidy described in 
                paragraph (1)(A) that is zero or de minimis 
                shall not by itself require the administering 
                authority to determine that revocation of a 
                countervailing duty order or termination of a 
                suspended investigation would not be likely to 
                lead to continuation or recurrence of a 
                countervailable subsidy.
                  (B) Application of de minimis standards.--For 
                purposes of this paragraph, the administering 
                authority shall apply the de minimis standards 
                applicable to reviews conducted under 
                subsections (a) and (b)(1) of section 751.
  (c) Determination of Likelihood of Continuation or Recurrence 
of Dumping.--
          (1) In general.--In a review conducted under section 
        751(c), the administering authority shall determine 
        whether revocation of an antidumping duty order or 
        termination of a suspended investigation under section 
        734 would be likely to lead to continuation or 
        recurrence of sales of the subject merchandise at less 
        than fair value. The administering authority shall 
        consider--
                  (A) the weighted average dumping margins 
                determined in the investigation and subsequent 
                reviews, and
                  (B) the volume of imports of the subject 
                merchandise for the period before and the 
                period after the issuance of the antidumping 
                duty order or acceptance of the suspension 
                agreement.
          (2) Consideration of other factors.--If good cause is 
        shown, the administering authority shall also consider 
        such other price, cost, market, or economic factors as 
        it deems relevant.
          (3) Magnitude of the margin of dumping.--The 
        administering authority shall provide to the Commission 
        the magnitude of the margin of dumping that is likely 
        to prevail if the order is revoked or the suspended 
        investigation is terminated. The administering 
        authority shall normally choose a margin that was 
        determined under section 735 or under subsection (a) or 
        (b)(1) of section 751.
          (4) Special rule.--
                  (A) Treatment of zero or de minimis 
                margins.--A dumping margin described in 
                paragraph (1)(A) that is zero or de minimis 
                shall not by itself require the administering 
                authority to determine that revocation of an 
                antidumping duty order or termination of a 
                suspended investigation would not be likely to 
                lead to continuation or recurrence of sales at 
                less than fair value.
                  (B) Application of de minimis standards.--For 
                purposes of this paragraph, the administering 
                authority shall apply the de minimis standards 
                applicable to reviews conducted under 
                subsections (a) and (b) of section 751.

  Chapter 2--Consultations and Determinations Regarding Quantitative 
                         Restriction Agreements


SEC. 761. REQUIRED CONSULTATIONS.

  (a) Agreements in Response to Countervailable Subsidies.--
Within 90 days after the administering authority accepts a 
quantitative restriction agreement under section 704(a)(2) or 
(c)(3), the President shall enter into consultations with the 
government that is party to the agreement for purposes of--
          (1) eliminating the countervailable subsidy 
        completely, or
          (2) reducing the net countervailable subsidy to a 
        level that eliminates completely the injurious effect 
        of exports to the United States of the merchandise.
  (b) Modification of Agreements on Basis of Consultations.--At 
the direction of the President, the administering authority 
shall modify a quantitative restriction agreement as a result 
of consultations entered into under subsection (a).
  (c) Special Rule Regarding Agreements Under Section 
704(c)(3).--This chapter shall cease to apply to a quantitative 
restriction agreement described in section 704(c)(3) at such 
time as that agreement ceases to have force and effect under 
section 704(f) or violation is found under section 704(i).

SEC. 762. REQUIRED DETERMINATIONS.

  (a) In General.--Before the expiration date, if any, of a 
quantitative restriction agreement accepted under section 
704(a)(2) or 704(c)(3) (if suspension of the related 
investigation is still in effect)--
          (1) the administering authority shall, at the 
        direction of the President, initiate a proceeding to 
        determine whether any countervailable subsidy is being 
        provided with respect to the subject merchandise and, 
        if being so provided, the net countervailable subsidy; 
        and
          (2) if the administering authority initiates a 
        proceeding under paragraph (1), the Commission shall 
        determine whether imports of the merchandise of the 
        kind subject to the agreement will, upon termination of 
        the agreement, materially injure, or threaten with 
        material injury, an industry in the United States or 
        materially retard the establishment of such an 
        industry.
  (b) Determinations.--The determinations required to be made 
by the administering authority and the Commission under 
subsection (a) shall be made under such procedures as the 
administering authority and the Commission, respectively, shall 
by regulation prescribe, and shall be treated as final 
determinations made under section 705 for purposes of judicial 
review under section 516A. If the determinations by each are 
affirmative, the administering authority shall--
          (1) issue a countervailing duty order under section 
        706 effective with respect to merchandise entered on 
        and after the date on which the agreement terminates; 
        and
          (2) order the suspension of liquidation of all 
        entries of subject merchandise which are entered, or 
        withdrawn from warehouse for consumption, on or after 
        the date of publication of the order in the Federal 
        Register.
  (c) Hearings.--The determination proceedings required to be 
prescribed under subsection (b) shall provide that the 
administering authority and the Commission must, upon the 
request of any interested party, hold a hearing in accordance 
with section 774 on the issues involved.

4. General Provisions Relating to Antidumping and Countervailing Duties


 Subtitle D of Title VII (Sections 771-782) of the Tariff Act of 1930, 
                               as amended


 [19 U.S.C. 1677, 1677-1, 1677-2, 1677a-1677n; P.L. 71-361, as amended 
 by P.L. 96-39, P.L. 98-573, P.L. 100-418, P.L. 103-465, and P.L. 104-
                                  295]

SEC. 771. DEFINITIONS; SPECIAL RULES.

  For purposes of this title--
          (1) Administering authority.--The term 
        ``administering authority'' means the Secretary of 
        Commerce, or any other officer of the United States to 
        whom the responsibility for carrying out the duties of 
        the administering authority under this title are 
        transferred by law.
          (2) Commission.--The term ``Commission'' means the 
        United States International Trade Commission.
          (3) Country.--The term ``country'' means a foreign 
        country, a political subdivision, dependent territory, 
        or possession of a foreign country, and, except for the 
        purpose of antidumping proceedings, may include an 
        association of 2 or more foreign countries, political 
        subdivisions, dependent territories, or possessions of 
        countries into a customs union outside the United 
        States.
          (4) Industry.--
                  (A) In general.--The term ``industry'' means 
                the producers as a whole of a domestic like 
                product, or those producers whose collective 
                output of a domestic like product constitutes a 
                major proportion of the total domestic 
                production of the product.
                  (B) Related parties.--
                          (i) If a producer of a domestic like 
                        product and an exporter or importer of 
                        the subject merchandise are related 
                        parties, or if a producer of the 
                        domestic like product is also an 
                        importer of the subject merchandise, 
                        the producer may, in appropriate 
                        circumstances, be excluded from the 
                        industry.
                          (ii) For purposes of clause (i), a 
                        producer and an exporter or importer 
                        shall be considered to be related 
                        parties, if--
                                  (I) the producer directly or 
                                indirectly controls the 
                                exporter or importer,
                                  (II) the exporter or importer 
                                directly or indirectly controls 
                                the producer,
                                  (III) a third party directly 
                                or indirectly controls the 
                                producer and the exporter or 
                                importer, or
                                  (IV) the producer and the 
                                exporter or importer directly 
                                or indirectly control a third 
                                party and there is reason to 
                                believe that the relationship 
                                causes the producer to act 
                                differently than a nonrelated 
                                producer.
                        For purposes of this subparagraph, a 
                        party shall be considered to directly 
                        or indirectly control another party if 
                        the party is legally or operationally 
                        in a position to exercise restraint or 
                        direction over the other party.
                  (C) Regional industries.--In appropriate 
                circumstances, the United States, for a 
                particular product market, may be divided into 
                2 or more markets and the producers within each 
                market may be treated as if they were a 
                separate industry if--
                          (i) the producers within such market 
                        sell all or almost all of their 
                        production of the domestic like product 
                        in question in that market, and
                          (ii) the demand in that market is not 
                        supplied, to any substantial degree, by 
                        producers of the product in question 
                        located elsewhere in the United States.
                In such appropriate circumstances, material 
                injury, the threat of material injury, or 
                material retardation of the establishment of an 
                industry may be found to exist with respect to 
                an industry even if the domestic industry as a 
                whole, or those producers whose collective 
                output of a domestic like product constitutes a 
                major proportion of the total domestic 
                production of that product, is not injured, if 
                there is a concentration of dumped imports or 
                imports of merchandise benefiting from a 
                countervailable subsidy into such an isolated 
                market and if the producers of all, or almost 
                all, of the production within that market are 
                being materially injured or threatened by 
                material injury, or if the establishment of an 
                industry is being materially retarded, by 
                reason of the dumped imports or imports of 
                merchandise benefiting from a countervailable 
                subsidy. The term ``regional industry'' means 
                the domestic producers within a region who are 
                treated as a separate industry under this 
                subparagraph.
                  (D) Product lines.--The effect of dumped 
                imports or imports of merchandise benefiting 
                from a countervailable subsidy shall be 
                assessed in relation to the United States 
                production of a domestic like product if 
                available data permit the separate 
                identification of production in terms of such 
                criteria as the production process or the 
                producer's profits. If the domestic production 
                of the domestic like product has no separate 
                identity in terms of such criteria, then the 
                effect of the dumped imports or imports of 
                merchandise benefiting from a countervailable 
                subsidy shall be assessed by the examination of 
                the production of the narrowest group or range 
                of products, which includes a domestic like 
                product, for which the necessary information 
                can be provided.
                  (E) Industry producing processed agricultural 
                products.--
                          (i) In general.--Subject to clause 
                        (v), in an investigation involving a 
                        processed agricultural product produced 
                        from any raw agricultural product, the 
                        producers or growers of the raw 
                        agricultural product may be considered 
                        part of the industry producing the 
                        processed product if--
                                  (I) the processed 
                                agricultural product is 
                                produced from the raw 
                                agricultural product through a 
                                single continuous line of 
                                production; and
                                  (II) there is a substantial 
                                coincidence of economic 
                                interest between the producers 
                                or growers of the raw 
                                agricultural product and the 
                                processors of the processed 
                                agricultural product based upon 
                                relevant economic factors, 
                                which may, in the discretion of 
                                the Commission, include price, 
                                added market value, or other 
                                economic interrelationships 
                                (regardless of whether such 
                                coincidence of economic 
                                interest is based upon any 
                                legal relationship).
                          (ii) Processing.--For purposes of 
                        this subparagraph, the processed 
                        agricultural product shall be 
                        considered to be processed from a raw 
                        agricultural product through a single 
                        continuous line of production if--
                                  (I) the raw agricultural 
                                product is substantially or 
                                completely devoted to the 
                                production of the processed 
                                agricultural product; and
                                  (II) the processed 
                                agricultural product is 
                                produced substantially or 
                                completely from the raw 
                                product.
                          (iii) Relevant economic factors.--For 
                        purposes of clause (i)(II), in addition 
                        to such other factors it considers 
                        relevant to the question of coincidence 
                        of economic interest, the Commission 
                        shall--
                                  (I) if price is taken into 
                                account, consider the degree of 
                                correlation between the price 
                                of the raw agricultural product 
                                and the price of the processed 
                                agricultural product; and
                                  (II) if added market value is 
                                taken into account, consider 
                                whether the value of the raw 
                                agricultural product 
                                constitutes a significant 
                                percentage of the value of the 
                                processed agricultural product.
                          (iv) Raw agricultural product.--For 
                        purposes of this subparagraph, the term 
                        ``raw agricultural product'' means any 
                        farm or fishery product.
                          (v) Termination of this 
                        subparagraph.--This subparagraph shall 
                        cease to have effect if the United 
                        States Trade Representative notifies 
                        the administering authority and the 
                        Commission that the application of this 
                        subparagraph is inconsistent with the 
                        international obligations of the United 
                        States.
          (5) Countervailable subsidy.--
                  (A) In general.--Except as provided in 
                paragraph (5B), a countervailable subsidy is a 
                subsidy described in this paragraph which is 
                specific as described in paragraph (5A).
                  (B) Subsidy described.--A subsidy is 
                described in this paragraph in the case in 
                which an authority--
                          (i) provides a financial 
                        contribution,
                          (ii) provides any form of income or 
                        price support within the meaning of 
                        Article XVI of the GATT 1994, or
                          (iii) makes a payment to a funding 
                        mechanism to provide a financial 
                        contribution, or entrusts or directs a 
                        private entity to make a financial 
                        contribution, if providing the 
                        contribution would normally be vested 
                        in the government and the practice does 
                        not differ in substance from practices 
                        normally followed by governments,
                to a person and a benefit is thereby conferred. 
                For purposes of this paragraph and paragraphs 
                (5A) and (5B), the term ``authority'' means a 
                government of a country or any public entity 
                within the territory of the country.\7\
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    \7\ Article 8 of the Uruguary Round Subsidies Agreement lapsed 
January 1, 2000.
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                  (C) Other factors.--The determination of 
                whether a subsidy exists shall be made without 
                regard to whether the recipient of the subsidy 
                is publicly or privately owned and without 
                regard to whether the subsidy is provided 
                directly or indirectly on the manufacture, 
                production, or export of merchandise. The 
                administering authority is not required to 
                consider the effect of the subsidy in 
                determining whether a subsidy exists under this 
                paragraph.
                  (D) Financial contribution.--The term 
                ``financial contribution'' means--
                          (i) the direct transfer of funds, 
                        such as grants, loans, and equity 
                        infusions, or the potential direct 
                        transfer of funds or liabilities, such 
                        as loan guarantees,
                          (ii) foregoing or not collecting 
                        revenue that is otherwise due, such as 
                        granting tax credits or deductions from 
                        taxable income,
                          (iii) providing goods or services, 
                        other than general infrastructure, or
                          (iv) purchasing goods.
                  (E) Benefit conferred.--A benefit shall 
                normally be treated as conferred where there is 
                a benefit to the recipient, including--
                          (i) in the case of an equity 
                        infusion, if the investment decision is 
                        inconsistent with the usual investment 
                        practice of private investors, 
                        including the practice regarding the 
                        provision of risk capital, in the 
                        country in which the equity infusion is 
                        made,
                          (ii) in the case of a loan, if there 
                        is a difference between the amount the 
                        recipient of the loan pays on the loan 
                        and the amount the recipient would pay 
                        on a comparable commercial loan that 
                        the recipient could actually obtain on 
                        the market,
                          (iii) in the case of a loan 
                        guarantee, if there is a difference, 
                        after adjusting for any difference in 
                        guarantee fees, between the amount the 
                        recipient of the guarantee pays on the 
                        guaranteed loan and the amount the 
                        recipient would pay for a comparable 
                        commercial loan if there were no 
                        guarantee by the authority, and
                          (iv) in the case where goods or 
                        services are provided, if such goods or 
                        services are provided for less than 
                        adequate remuneration, and in the case 
                        where goods are purchased, if such 
                        goods are purchased for more than 
                        adequate remuneration.
                For purposes of clause (iv), the adequacy of 
                remuneration shall be determined in relation to 
                prevailing market conditions for the good or 
                service being provided or the goods being 
                purchased in the country which is subject to 
                the investigation or review. Prevailing market 
                conditions include price, quality, 
                availability, marketability, transportation, 
                and other conditions of purchase or sale.
                  (F) Change in ownership.--A change in 
                ownership of all or part of a foreign 
                enterprise or the productive assets of a 
                foreign enterprise does not by itself require a 
                determination by the administering authority 
                that a past countervailable subsidy received by 
                the enterprise no longer continues to be 
                countervailable, even if the change in 
                ownership is accomplished through an arm's 
                length transaction.
          (5A) Specificity.--
                  (A) In general.--A subsidy is specific if it 
                is an export subsidy described in subparagraph 
                (B) or an import substitution subsidy described 
                in subparagraph (C), or if it is determined to 
                be specific pursuant to subparagraph (D).
                  (B) Export subsidy.--An export subsidy is a 
                subsidy that is, in law or in fact, contingent 
                upon export performance, alone or as 1 of 2 or 
                more conditions.
                  (C) Import substitution subsidy.--An import 
                substitution subsidy is a subsidy that is 
                contingent upon the use of domestic goods over 
                imported goods, alone or as 1 of 2 or more 
                conditions.
                  (D) Domestic subsidy.--In determining whether 
                a subsidy (other than a subsidy described in 
                subparagraph (B) or (C)) is a specific subsidy, 
                in law or in fact, to an enterprise or industry 
                within the jurisdiction of the authority 
                providing the subsidy, the following guidelines 
                shall apply:
                          (i) Where the authority providing the 
                        subsidy, or the legislation pursuant to 
                        which the authority operates, expressly 
                        limits access to the subsidy to an 
                        enterprise or industry, the subsidy is 
                        specific as a matter of law.
                          (ii) Where the authority providing 
                        the subsidy, or the legislation 
                        pursuant to which the authority 
                        operates, establishes objective 
                        criteria or conditions governing the 
                        eligibility for, and the amount of, a 
                        subsidy, the subsidy is not specific as 
                        a matter of law, if--
                                  (I) eligibility is automatic,
                                  (II) the criteria or 
                                conditions for eligibility are 
                                strictly followed, and
                                  (III) the criteria or 
                                conditions are clearly set 
                                forth in the relevant statute, 
                                regulation, or other official 
                                document so as to be capable of 
                                verification.
                        For purposes of this clause, the term 
                        ``objective criteria or conditions'' 
                        means criteria or conditions that are 
                        neutral and that do not favor one 
                        enterprise or industry over another.
                          (iii) Where there are reasons to 
                        believe that a subsidy may be specific 
                        as a matter of fact, the subsidy is 
                        specific if one or more of the 
                        following factors exist:
                                  (I) The actual recipients of 
                                the subsidy, whether considered 
                                on an enterprise or industry 
                                basis, are limited in number.
                                  (II) An enterprise or 
                                industry is a predominant user 
                                of the subsidy.
                                  (III) An enterprise or 
                                industry receives a 
                                disproportionately large amount 
                                of the subsidy.
                                  (IV) The manner in which the 
                                authority providing the subsidy 
                                has exercised discretion in the 
                                decision to grant the subsidy 
                                indicates that an enterprise or 
                                industry is favored over 
                                others.
                        In evaluating the factors set forth in 
                        subclauses (I), (II), (III), and (IV), 
                        the administering authority shall take 
                        into account the extent of 
                        diversification of economic activities 
                        within the jurisdiction of the 
                        authority providing the subsidy, and 
                        the length of time during which the 
                        subsidy program has been in operation.
                          (iv) Where a subsidy is limited to an 
                        enterprise or industry located within a 
                        designated geographical region within 
                        the jurisdiction of the authority 
                        providing the subsidy, the subsidy is 
                        specific.
        For purposes of this paragraph and paragraph (5B), any 
        reference to an enterprise or industry is a reference 
        to a foreign enterprise or foreign industry and 
        includes a group of such enterprises or industries.
          (5B) Categories of noncountervailable subsidies.--
                  (A) In general.--Notwithstanding the 
                provisions of paragraphs (5) and (5A), in the 
                case of merchandise imported from a Subsidies 
                Agreement country, a subsidy shall be treated 
                as noncountervailable if the administering 
                authority determines in an investigation under 
                subtitle A or a review under subtitle C that 
                the subsidy meets all of the criteria described 
                in subparagraph (B), (C), or (D), as the case 
                may be, or the provisions of subparagraph 
                (E)(i) apply.
                  [(B) Research subsidy.--\8\
---------------------------------------------------------------------------
    \8\ Pursuant to section 282(c)(1) of the Uruguary Round Agreement 
Act, subparagraph (B) of section 771(5B) of the Tariff Act of 1930 
ceased to appply as of July 1, 2000.
---------------------------------------------------------------------------
                          (i) In general.--Except for a subsidy 
                        provided on the manufacture, 
                        production, or export of civil 
                        aircraft, a subsidy for research 
                        activities conducted by a person, or by 
                        a higher education or research 
                        establishment on a contract basis with 
                        a person, shall be treated as 
                        noncountervailable, if the subsidy 
                        covers not more than 75 percent of the 
                        costs of industrial research or not 
                        more than 50 percent of the costs of 
                        precompetitive development activity, 
                        and such subsidy is limited exclusively 
                        to--
                                  (I) the costs of researchers, 
                                technicians, and other 
                                supporting staff employed 
                                exclusively in the research 
                                activity,
                                  (II) the costs of 
                                instruments, equipment, land, 
                                or buildings that are used 
                                exclusively and permanently 
                                (except when disposed of on a 
                                commercial basis) for the 
                                research activity,
                                  (III) the costs of 
                                consultancy and equivalent 
                                services used exclusively for 
                                the research activity, 
                                including costs for bought-in 
                                research, technical knowledge, 
                                and patents,
                                  (IV) additional overhead 
                                costs incurred directly as a 
                                result of the research 
                                activity, and
                                  (V) other operating costs 
                                (such as materials and 
                                supplies) incurred directly as 
                                a result of the research 
                                activity.
                          (ii) Definitions.--For purposes of 
                        this subparagraph--
                                  (I) Industrial research.--The 
                                term ``industrial research'' 
                                means planned search or 
                                critical investigation aimed at 
                                the discovery of new knowledge, 
                                with the objective that such 
                                knowledge may be useful in 
                                developing new products, 
                                processes, or services, or in 
                                bringing about a significant 
                                improvement to existing 
                                products, processes, or 
                                services.
                                  (II) Precompetitive 
                                development activity.--The term 
                                ``precompetitive development 
                                activity'' means the 
                                translation of industrial 
                                research findings into a plan, 
                                blueprint, or design for new, 
                                modified, or improved products, 
                                processes, or services, whether 
                                intended for sale or use, 
                                including the creation of a 
                                first prototype that would not 
                                be capable of commercial use. 
                                The term also may include the 
                                conceptual formulation and 
                                design of products, processes, 
                                or services alternatives and 
                                initial demonstration or pilot 
                                projects, if these same 
                                projects cannot be converted or 
                                used for industrial application 
                                or commercial exploitation. The 
                                term does not include routine 
                                or periodic alterations to 
                                existing products, production 
                                lines, manufacturing processes, 
                                services, or other ongoing 
                                operations even if those 
                                alterations may represent 
                                improvements.
                          (iii) Calculation rules.--
                                  (I) In general.--In the case 
                                of a research activity that 
                                spans both industrial research 
                                and precompetitive development 
                                activity, the allowable level 
                                of the noncountervailable 
                                subsidy shall not exceed 62.5 
                                percent of the costs set forth 
                                in subclauses (I), (II), (III), 
                                (IV), and (V) of clause (i).
                                  (II) Total eligible costs.--
                                The allowable level of a 
                                noncountervailable subsidy 
                                described in clause (i) shall 
                                be based on the total eligible 
                                costs incurred over the 
                                duration of a particular 
                                project.]
                  [(C) Subsidy to disadvantaged regions.--\9\
---------------------------------------------------------------------------
    \9\ Pursuant to section 282(c)(1) of the Uruguay Round Agreements 
Act subparagraph (C) of section 771(5B) of the Tariff Act of 1930 
ceased to apply as of July 1, 2000.
---------------------------------------------------------------------------
                          (i) In general.--A subsidy provided, 
                        pursuant to a general framework of 
                        regional development, to a person 
                        located in a disadvantaged region 
                        within a country shall be treated as 
                        noncountervailable, if it is not 
                        specific (within the meaning of 
                        paragraph (5A)) within eligible regions 
                        and if the following conditions are 
                        met:
                                  (I) Each region identified as 
                                disadvantaged within the 
                                territory of a country is a 
                                clearly designated, contiguous 
                                geographical area with a 
                                definable economic and 
                                administrative identity.
                                  (II) Each region is 
                                considered a disadvantaged 
                                region on the basis of neutral 
                                and objective criteria 
                                indicating that the region is 
                                disadvantaged because of more 
                                than temporary circumstances, 
                                and such criteria are clearly 
                                stated in the relevant statute, 
                                regulation, or other official 
                                document so as to be capable of 
                                verification.
                                  (III) The criteria described 
                                in subclause (II) include a 
                                measurement of economic 
                                development.
                                  (IV) Programs provided within 
                                a general framework of regional 
                                development include ceilings on 
                                the amount of assistance that 
                                can be granted to a subsidized 
                                project. Such ceilings are 
                                differentiated according to the 
                                different levels of development 
                                of assisted regions, and are 
                                expressed in terms of 
                                investment costs or costs of 
                                job creation. Within such 
                                ceilings, the distribution of 
                                assistance is sufficiently 
                                broad and even to avoid the 
                                predominant use of a subsidy 
                                by, or the provision of 
                                disproportionately large 
                                amounts of a subsidy to, an 
                                enterprise or industry as 
                                described in paragraph (5A)(D).
                          (ii) Measurement of economic 
                        development.--For purposes of clause 
                        (i), the measurement of economic 
                        development shall be based on one or 
                        more of the following factors:
                                  (I) Per capita income, 
                                household per capita income, or 
                                per capita gross domestic 
                                product that does not exceed 85 
                                percent of the average for the 
                                country subject to 
                                investigation or review.
                                  (II) An unemployment rate 
                                that is at least 110 percent of 
                                the average unemployment rate 
                                for the country subject to 
                                investigation or review.
                        The measurement of economic development 
                        shall cover a 3-year period, but may be 
                        a composite measurement and may include 
                        factors other than those set forth in 
                        this clause.
                          (iii) Definitions.--For purposes of 
                        this subparagraph--
                                  (I) General framework of 
                                regional development.--The term 
                                ``general framework of regional 
                                development'' means that the 
                                regional subsidy programs are 
                                part of an internally 
                                consistent and generally 
                                applicable regional development 
                                policy, and that regional 
                                development subsidies are not 
                                granted in isolated 
                                geographical points having no, 
                                or virtually no, influence on 
                                the development of a region.
                                  (II) Neutral and objective 
                                criteria.--The term ``neutral 
                                and objective criteria'' means 
                                criteria that do not favor 
                                certain regions beyond what is 
                                appropriate for the elimination 
                                or reduction of regional 
                                disparities within the 
                                framework of the regional 
                                development policy.]
                  [(D) Subsidy for adaptation of existing 
                facilities to new environmental requirements.--
                \10\
---------------------------------------------------------------------------
    \10\ Pursuant to sectin 282(c)(1) of the Uruguary Round Agreements 
Act, subparagraph (D) of section 771(5B) of the Tariff Act of 1930 
ceased to apply as of July 1, 2000.
---------------------------------------------------------------------------
                          (i) In general.--A subsidy that is 
                        provided to promote the adaptation of 
                        existing facilities to new 
                        environmental requirements that are 
                        imposed by statute or by regulation, 
                        and that result in greater constraints 
                        and financial burdens on the recipient 
                        of the subsidy, shall be treated as 
                        noncountervailable, if the subsidy--
                                  (I) is a one-time 
                                nonrecurring measure,
                                  (II) is limited to 20 percent 
                                of the cost of adaptation,
                                  (III) does not cover the cost 
                                of replacing and operating the 
                                subsidized investment, a cost 
                                that must be fully borne by the 
                                recipient,
                                  (IV) is directly linked and 
                                proportionate to the 
                                recipient's planned reduction 
                                of nuisances and pollution, and 
                                does not cover any 
                                manufacturing cost savings that 
                                may be achieved, and
                                  (V) is available to all 
                                persons that can adopt the new 
                                equipment or production 
                                processes.
                          (ii) Existing facilities.--For 
                        purposes of this subparagraph, the term 
                        ``existing facilities'' means 
                        facilities that have been in operation 
                        for at least 2 years before the date on 
                        which the new environmental 
                        requirements are imposed.]
                  [(E) Notified subsidy program.--\11\
---------------------------------------------------------------------------
    \11\ Pursuant to section 282(c)(1) of the Uruguay Round Agreements 
Act, subparagraph (E) of section 771(5B) of the Tariff Act of 1930 
ceased to apply as of July 1, 2000.
---------------------------------------------------------------------------
                          (i) General rule.--If a subsidy is 
                        provided pursuant to a program that has 
                        been notified in accordance with 
                        Article 8.3 of the Subsidies Agreement, 
                        the subsidy shall be treated as 
                        noncountervailable and shall not be 
                        subject to investigation or review 
                        under this title.
                          (ii) Exception.--Notwithstanding 
                        clause (i), a subsidy shall be treated 
                        as countervailable if--
                                  (I) the Trade Representative 
                                notifies the administering 
                                authority that a determination 
                                has been made pursuant to 
                                Article 8.4 or 8.5 of the 
                                Subsidies Agreement that the 
                                subsidy, or the program 
                                pursuant to which the subsidy 
                                was provided, does not satisfy 
                                the conditions and criteria of 
                                Article 8.2 of the Subsidies 
                                Agreement; and
                                  (II) the subsidy is specific 
                                within the meaning of paragraph 
                                (5A).]
                  (F) Certain subsidies on agricultural 
                products.--Domestic support measures that are 
                provided with respect to products listed in 
                Annex 1 to the Agreement on Agriculture, and 
                that the administering authority determines 
                conform fully to the provisions of Annex 2 to 
                that Agreement, shall be treated as 
                noncountervailable. Upon request by the 
                administering authority, the Trade 
                Representative shall provide advice regarding 
                the interpretation and application of Annex 2.
                  (G) Provisional application.--
                          (i) Subparagraphs (B), (C), (D), and 
                        (E) shall not apply on or after the 
                        first day of the month that is 66 
                        months after the WTO Agreement enters 
                        into force, unless the provisions of 
                        such subparagraphs are extended 
                        pursuant to section 282(c) of the 
                        Uruguay Round Agreements Act.
                          (ii) Subparagraph (F) shall not apply 
                        to imports from a WTO member country at 
                        the end of the 9-year period beginning 
                        on January 1, 1995. The Trade 
                        Representative shall determine the 
                        precise termination date for each WTO 
                        member country in accordance with 
                        paragraph (i) of Article 1 of the 
                        Agreement on Agriculture and such date 
                        shall be notified to the administering 
                        authority.
          (6) Net countervailable subsidy.--For the purpose of 
        determining the net countervailable subsidy, the 
        administering authority may subtract from the gross 
        countervailable subsidy the amount of--
                  (A) any application fee, deposit, or similar 
                payment paid in order to qualify for, or to 
                receive, the benefit of the countervailable 
                subsidy,
                  (B) any loss in the value of the 
                countervailable subsidy resulting from its 
                deferred receipt, if the deferral is mandated 
                by Government order, and
                  (C) export taxes, duties, or other charges 
                levied on the export of merchandise to the 
                United States specifically intended to offset 
                the countervailable subsidy received.
          (7) Material injury.--
                  (A) In general.--The term ``material injury'' 
                means harm which is not inconsequential, 
                immaterial, or unimportant.
                  (B) Volume and consequent impact.--In making 
                determinations under sections 703(a), 705(b), 
                733(a), and 735(b), the Commission in each 
                case--
                          (i) shall consider--
                                  (I) the volume of imports of 
                                the subject merchandise,
                                  (II) the effect of imports of 
                                that merchandise on prices in 
                                the United States for like 
                                products \1\, and
                                  (III) the impact of imports 
                                of such merchandise on domestic 
                                producers of like products \1\, 
                                but only in the context of 
                                production operations within 
                                the United States; and
                          (ii) may consider such other economic 
                        factors as are relevant to the 
                        determination regarding whether there 
                        is material injury by reason of 
                        imports.
                In the notification required under section 
                705(d) or 735(d), as the case may be, the 
                Commission shall explain its analysis of each 
                factor considered under clause (i), and 
                identify each factor considered under clause 
                (ii) and explain in full its relevance to the 
                determination.
                  (C) Evaluation of relevant factors.--For 
                purposes of subparagraph (B)--
                          (i) Volume.--In evaluating the volume 
                        of imports of merchandise, the 
                        Commission shall consider whether the 
                        volume of imports of the merchandise, 
                        or any increase in that volume, either 
                        in absolute terms or relative to 
                        production or consumption in the United 
                        States, is significant.
                          (ii) Price.--In evaluating the effect 
                        of imports of such merchandise on 
                        prices, the Commission shall consider 
                        whether--
                                  (I) there has been 
                                significant price underselling 
                                by the imported merchandise as 
                                compared with the price of like 
                                products \12\ of the United 
                                States, and
---------------------------------------------------------------------------
    \12\ Section 233(a)(3)(B) of P.L. 103-465 amends this subclause by 
striking ``like product'' and inserting ``domestic like product.'' The 
phrase ``like product'' does not appear.
---------------------------------------------------------------------------
                                  (II) the effect of imports of 
                                such merchandise otherwise 
                                depresses prices to a 
                                significant degree or prevents 
                                price increases, which 
                                otherwise would have occurred, 
                                to a significant degree.
                          (iii) Impact on affected domestic 
                        industry.--In examining the impact 
                        required to be considered under 
                        subparagraph (B)(i)(III), the 
                        Commission shall evaluate all relevant 
                        economic factors which have a bearing 
                        on the state of the industry in the 
                        United States, including, but not 
                        limited to--
                                  (I) actual and potential 
                                decline in output, sales, 
                                market share, profits, 
                                productivity, return on 
                                investments, and utilization of 
                                capacity,
                                  (II) factors affecting 
                                domestic prices,
                                  (III) actual and potential 
                                negative effects on cash flow, 
                                inventories, employment, wages, 
                                growth, ability to raise 
                                capital, and investment,
                                  (IV) actual and potential 
                                negative effects on the 
                                existing development and 
                                production efforts of the 
                                domestic industry, including 
                                efforts to develop a derivative 
                                or more advanced version of the 
                                domestic like product, and
                                  (V) in a proceeding under 
                                subtitle B, the magnitude of 
                                the margin of dumping.
                        The Commission shall evaluate all 
                        relevant economic factors described in 
                        this clause within the context of the 
                        business cycle and conditions of 
                        competition that are distinctive to the 
                        affected industry.
                          (iv) Captive production.--If domestic 
                        producers internally transfer 
                        significant production of the domestic 
                        like product for the production of a 
                        downstream article and sell significant 
                        production of the domestic like product 
                        in the merchant market, and the 
                        Commission finds that--
                                  (I) the domestic like product 
                                produced that is internally 
                                transferred for processing into 
                                that downstream article does 
                                not enter the merchant market 
                                for the domestic like product,
                                  (II) the domestic like 
                                product is the predominant 
                                material input in the 
                                production of that downstream 
                                article, and
                                  (III) the production of the 
                                domestic like product sold in 
                                the merchant market is not 
                                generally used in the 
                                production of that downstream 
                                article,
                        then the Commission, in determining 
                        market share and the factors affecting 
                        financial performance set forth in 
                        clause (iii), shall focus primarily on 
                        the merchant market for the domestic 
                        like product.
                  (D) Special rules for agricultural 
                products.--
                          (i) The Commission shall not 
                        determine that there is no material 
                        injury or threat of material injury to 
                        the United States producers of an 
                        agricultural commodity merely because 
                        the prevailing market price is at or 
                        above the minimum support price.
                          (ii) In the case of agricultural 
                        products, the Commission shall consider 
                        any increased burden on government 
                        income or price support programs.
                  (E) Special rules.--For purposes of this 
                paragraph--
                          (i) Nature of countervailable 
                        subsidy.--In determining whether there 
                        is a threat of material injury, the 
                        Commission shall consider information 
                        provided to it by the administering 
                        authority regarding the nature of the 
                        countervailable subsidy granted by a 
                        foreign country (particularly whether 
                        the countervailable subsidy is a 
                        subsidy described in Article 3 or 6.1 
                        of the Subsidies Agreement) and the 
                        effects likely to be caused by the 
                        countervailable subsidy.\13\
---------------------------------------------------------------------------
    \13\ Article 6.1 of the Uruguray Round Subsidies Agreement lapsed 
January 1, 2000.
---------------------------------------------------------------------------
                          (ii) Standard for determination.--The 
                        presence or absence of any factor which 
                        the Commission is required to evaluate 
                        under subparagraph (C) or (D) shall not 
                        necessarily give decisive guidance with 
                        respect to the determination by the 
                        Commission of material injury.
                  (F) Threat of material injury.--
                          (i) In general.--In determining 
                        whether an industry in the United 
                        States is threatened with material 
                        injury by reason of imports (or sales 
                        for importation) of the subject 
                        merchandise, the Commission shall 
                        consider, among other relevant economic 
                        factors--
                                  (I) if a countervailable 
                                subsidy is involved, such 
                                information as may be presented 
                                to it by the administering 
                                authority as to the nature of 
                                the subsidy (particularly as to 
                                whether the countervailable 
                                subsidy is a subsidy described 
                                in Article 3 or 6.1 of the 
                                Subsidies Agreement), and 
                                whether imports of the subject 
                                merchandise are likely to 
                                increase,\14\
---------------------------------------------------------------------------
    \14\ Article 6.1 of the Uruguray Round Subsidies Agreement lapsed 
January 1, 2000.
---------------------------------------------------------------------------
                                  (II) any existing unused 
                                production capacity or 
                                imminent, substantial increase 
                                in production capacity in the 
                                exporting country indicating 
                                the likelihood of substantially 
                                increased imports of the 
                                subject merchandise into the 
                                United States, taking into 
                                account the availability of 
                                other export markets to absorb 
                                any additional exports,
                                  (III) a significant rate of 
                                increase of the volume or 
                                market penetration of imports 
                                of the subject merchandise 
                                indicating the likelihood of 
                                substantially increased 
                                imports,
                                  (IV) whether imports of the 
                                subject merchandise are 
                                entering at prices that are 
                                likely to have a significant 
                                depressing or suppressing 
                                effect on domestic prices, and 
                                are likely to increase demand 
                                for further imports,
                                  (V) inventories of the 
                                subject merchandise,
                                  (VI) the potential for 
                                product-shifting if production 
                                facilities in the foreign 
                                country, which can be used to 
                                produce the subject 
                                merchandise, are currently 
                                being used to produce other 
                                products,
                                  (VII) in any investigation 
                                under this title which involves 
                                imports of both a raw 
                                agricultural product (within 
                                the meaning of paragraph 
                                (4)(E)(iv)) and any product 
                                processed from such raw 
                                agricultural product, the 
                                likelihood that there will be 
                                increased imports, by reason of 
                                product shifting, if there is 
                                an affirmative determination by 
                                the Commission under section 
                                705(b)(1) or 735(b)(1) with 
                                respect to either the raw 
                                agricultural product or the 
                                processed agricultural product 
                                (but not both),
                                  (VIII) the actual and 
                                potential negative effects on 
                                the existing development and 
                                production efforts of the 
                                domestic industry, including 
                                efforts to develop a derivative 
                                or more advanced version of the 
                                domestic like product, and
                                  (IX) any other demonstrable 
                                adverse trends that indicate 
                                the probability that there is 
                                likely to be material injury by 
                                reason of imports (or sale for 
                                importation) of the subject 
                                merchandise (whether or not it 
                                is actually being imported at 
                                the time).
                          (ii) Basis for determination.--The 
                        Commission shall consider the factors 
                        set forth in clause (i) as a whole in 
                        making a determination of whether 
                        further dumped or subsidized imports 
                        are imminent and whether material 
                        injury by reason of imports would occur 
                         unless an order is issued or a 
                        suspension agreement is accepted under 
                        this title. The presence or absence of 
                        any factor which the Commission is 
                        required to consider under clause (i) 
                        shall not necessarily give decisive 
                        guidance with respect to the 
                        determination. Such a determination may 
                        not be made on the basis of mere 
                        conjecture or supposition.
                          (iii) Effect of dumping in third-
                        country markets.--
                                  (I) In general.--In 
                                investigations under subtitle 
                                B, the Commission shall 
                                consider whether dumping in the 
                                markets of foreign countries 
                                (as evidenced by dumping 
                                findings or antidumping 
                                remedies in other WTO member 
                                markets against the same class 
                                or kind of merchandise 
                                manufactured or exported by the 
                                same party as under 
                                investigation) suggests a 
                                threat of material injury to 
                                the domestic industry. In the 
                                course of its investigation, 
                                the Commission shall request 
                                information from the foreign 
                                manufacturer, exporter, or 
                                United States importer 
                                concerning this issue.
                                  (II) WTO member market.--For 
                                purposes of this clause, the 
                                term ``WTO member market'' 
                                means the market of any country 
                                which is a WTO member.
                                  (III) European communities.--
                                For purposes of this clause, 
                                the European Communities shall 
                                be treated as a foreign 
                                country.
                  (G) Cumulation for determining material 
                injury.--
                          (i) In general.--For purposes of 
                        clauses (i) and (ii) of subparagraph 
                        (C), and subject to clause (ii), the 
                        Commission shall cumulatively assess 
                        the volume and effect of imports of the 
                        subject merchandise from all countries 
                        with respect to which--
                                  (I) petitions were filed 
                                under section 702(b) or 732(b) 
                                on the same day,
                                  (II) investigations were 
                                initiated under section 702(a) 
                                or 732(a) on the same day, or
                                  (III) petitions were filed 
                                under section 702(b) or 732(b) 
                                and investigations were 
                                initiated under section 702(a) 
                                or 732(a) on the same day,
                        if such imports compete with each other 
                        and with domestic like products in the 
                        United States market.
                          (ii) Exceptions.--The Commission 
                        shall not cumulatively assess the 
                        volume and effect of imports under 
                        clause (i)--
                                  (I) with respect to which the 
                                administering authority has 
                                made a preliminary negative 
                                determination, unless the 
                                administering authority 
                                subsequently made a final 
                                affirmative determination with 
                                respect to those imports before 
                                the Commission's final 
                                determination is made;
                                  (II) from any country with 
                                respect to which the 
                                investigation has been 
                                terminated;
                                  (III) from any country 
                                designated as a beneficiary 
                                country under the Caribbean 
                                Basin Economic Recovery Act (19 
                                U.S.C. 2701 et seq.) for 
                                purposes of making a 
                                determination with respect to 
                                that country, except that the 
                                volume and effect of imports of 
                                the subject merchandise from 
                                such country may be 
                                cumulatively assessed with 
                                imports of the subject 
                                merchandise from any other 
                                country designated as such a 
                                beneficiary country to the 
                                extent permitted by clause (i); 
                                or
                                  (IV) from any country that is 
                                a party to an agreement with 
                                the United States establishing 
                                a free trade area, which 
                                entered into force and effect 
                                before January 1, 1987, unless 
                                the Commission determines that 
                                a domestic industry is 
                                materially injured or 
                                threatened with material injury 
                                by reason of imports from that 
                                country.
                          (iii) Records in final 
                        investigations.--In each final 
                        determination in which it cumulatively 
                        assesses the volume and effect of 
                        imports under clause (i), the 
                        Commission shall make its 
                        determinations based on the record 
                        compiled in the first investigation in 
                        which it makes a final determination, 
                        except that when the administering 
                        authority issues its final 
                        determination in a subsequently 
                        completed investigation, the Commission 
                        shall permit the parties in the 
                        subsequent investigation to submit 
                        comments concerning the significance of 
                        the administering authority's final 
                        determination, and shall include such 
                        comments and the administering 
                        authority's final determination in the 
                        record for the subsequent 
                        investigation.
                          (iv) Regional industry 
                        determinations.--In an investigation 
                        which involves a regional industry, and 
                        in which the Commission decides that 
                        the volume and effect of imports should 
                        be cumulatively assessed under this 
                        subparagraph, such assessment shall be 
                        based upon the volume and effect of 
                        imports into the region or regions 
                        determined by the Commission. The 
                        provisions of clause (iii) shall apply 
                        to such investigations.
                  (H) Cumulation for determining threat of 
                material injury.--To the extent practicable and 
                subject to subparagraph (G)(ii), for purposes 
                of clause (i)(III) and (IV) of subparagraph 
                (F), the Commission may cumulatively assess the 
                volume and price effects of imports of the 
                subject merchandise from all countries with 
                respect to which--
                          (i) petitions were filed under 
                        section 702(b) or 732(b) on the same 
                        day,
                          (ii) investigations were initiated 
                        under section 702(a) or 732(a) on the 
                        same day, or
                          (iii) petitions were filed under 
                        section 702(b) or 732(b) and 
                        investigations were initiated under 
                        section 702(a) or 732(a) on the same 
                        day,
                if such imports compete with each other and 
                with domestic like products in the United 
                States market.
                  (I) Consideration of post-petition 
                information.--The Commission shall consider 
                whether any change in the volume, price 
                effects, or impact of imports of the subject 
                merchandise since the filing of the petition in 
                an investigation under subtitle A or B is 
                related to the pendency of the investigation 
                and, if so, the Commission may reduce the 
                weight accorded to the data for the period 
                after the filing of the petition in making its 
                determination of material injury, threat of 
                material injury, or material retardation of the 
                establishment of an industry in the United 
                States.
          (8) Subsidies agreement; agreement on agriculture.--
                  (A) Subsidies agreement.--The term 
                ``Subsidies Agreement'' means the Agreement on 
                Subsidies and Countervailing Measures referred 
                to in section 101(d)(12) of the Uruguay Round 
                Agreements Act.
                  (B) Agreement on agriculture.--The term 
                ``Agreement on Agriculture'' means the 
                Agreement on Agriculture referred to in section 
                101(d)(2) of the Uruguay Round Agreements Act.
          (9) Interested party.--The term ``interested party'' 
        means--
                  (A) a foreign manufacturer, producer, or 
                exporter, or the United States importer, of 
                subject merchandise or a trade or business 
                association a majority of the members of which 
                are producers, exporters, or importers of such 
                merchandise,
                  (B) the government of a country in which such 
                merchandise is produced or manufactured or from 
                which such merchandise is exported,
                  (C) a manufacturer, producer, or wholesaler 
                in the United States of a domestic like 
                product,
                  (D) a certified union or recognized union or 
                group of workers which is representative of an 
                industry engaged in the manufacture, 
                production, or wholesale in the United States 
                of a domestic like product,
                  (E) a trade or business association a 
                majority of whose members manufacture, produce, 
                or wholesale a domestic like product in the 
                United States,
                  (F) an association, a majority of whose 
                members is composed of interested parties 
                described in subparagraph (C), (D), or (E) with 
                respect to a domestic like product, and
                  (G) in any investigation under this title 
                involving an industry engaged in producing a 
                processed agricultural product, as defined in 
                paragraph (4)(E), a coalition or trade 
                association which is representative of either--
                          (i) processors,
                          (ii) processors and producers, or
                          (iii) processors and growers,
                but this subparagraph shall cease to have 
                effect if the United States Trade 
                Representative notifies the administering 
                authority and the Commission that the 
                application of this subparagraph is 
                inconsistent with the international obligations 
                of the United States.
          (10) Domestic like product.--The term ``domestic like 
        product'' means a product which is like, or in the 
        absence of like, most similar in characteristics and 
        uses with, the article subject to an investigation 
        under this title.
          (11) Affirmative determinations by divided 
        commission.--If the Commissioners voting on a 
        determination by the Commission, including a 
        determination under section 751, are evenly divided as 
        to whether the determination should be affirmative or 
        negative, the Commission shall be deemed to have made 
        an affirmative determination. For the purpose of 
        applying this paragraph when the issue before the 
        Commission is to determine whether there is--
                  (A) material injury to an industry in the 
                United States,
                  (B) threat of material injury to such an 
                industry, or
                  (C) material retardation of the establishment 
                of an industry in the United States,
        by reason of imports of the merchandise, an affirmative 
        vote on any of the issues shall be treated as a vote 
        that the determination should be affirmative.
          (12) Attribution of merchandise to country of 
        manufacture or production.--For purposes of subtitle A, 
        merchandise shall be treated as the product of the 
        country in which it was manufactured or produced 
        without regard to whether it is imported directly from 
        that country and without regard to whether it is 
        imported in the same condition as when exported from 
        that country or in a changed condition by reason of 
        remanufacture or otherwise.
          (13) [Repealed.]
          (14) Sold or, in the absence of sales, offered for 
        sale.--The term ``sold or, in the absence of sales, 
        offered for sale'' means sold or, in the absence of 
        sales, offered--
                  (A) to all purchasers in commercial 
                quantities, or
                  (B) in the ordinary course of trade to one or 
                more selected purchasers in commercial 
                quantities at a price which fairly reflects the 
                market value of the merchandise,
        without regard to restrictions as to the disposition or 
        use of the merchandise by the purchaser except that, 
        where such restrictions are found to affect the market 
        value of the merchandise, adjustment shall be made 
        therefor in calculating the price at which the 
        merchandise is sold or offered for sale.
          (15) Ordinary course of trade.--The term ``ordinary 
        course of trade'' means the conditions and practices 
        which, for a reasonable time prior to the exportation 
        of the subject merchandise, have been normal in the 
        trade under consideration with respect to merchandise 
        of the same class or kind. The administering authority 
        shall consider the following sales and transactions, 
        among others, to be outside the ordinary course of 
        trade:
                  (A) Sales disregarded under section 
                773(b)(1).
                  (B) Transactions disregarded under section 
                773(f)(2).
          (16) Foreign like product.--The term ``foreign like 
        product'' means merchandise in the first of the 
        following categories in respect of which a 
        determination for the purposes of subtitle B of this 
        title can be satisfactorily made:
                  (A) The subject merchandise and other 
                merchandise which is identical in physical 
                characteristics with, and was produced in the 
                same country by the same person as, that 
                merchandise.
                  (B) Merchandise--
                          (i) produced in the same country and 
                        by the same person as the subject 
                        merchandise,
                          (ii) like that merchandise in 
                        component material or materials and in 
                        the purposes for which used, and
                          (iii) approximately equal in 
                        commercial value to that merchandise.
                  (C) Merchandise--
                          (i) produced in the same country and 
                        by the same person and of the same 
                        general class or kind as the 
                        merchandise which is the subject of the 
                        investigation,
                          (ii) like that merchandise in the 
                        purposes for which used, and
                          (iii) which the administering 
                        authority determines may reasonably be 
                        compared with that merchandise.
          (17) Usual commercial quantities.--The term ``usual 
        commercial quantities'', in any case in which the 
        subject merchandise is sold in the market under 
        consideration at different prices for different 
        quantities, means the quantities in which such 
        merchandise is there sold at the price or prices for 
        one quantity in an aggregate volume which is greater 
        than the aggregate volume sold at the price or prices 
        for any other quantity.
          (18) Nonmarket economy country.--
                  (A) In general.--The term ``nonmarket economy 
                country'' means any foreign country that the 
                administering authority determines does not 
                operate on market principles of cost or pricing 
                structures, so that sales of merchandise in 
                such country do not reflect the fair value of 
                the merchandise.
                  (B) Factors to be considered.--In making 
                determinations under subparagraph (A) the 
                administering authority shall take into 
                account--
                          (i) the extent to which the currency 
                        of the foreign country is convertible 
                        into the currency of other countries;
                          (ii) the extent to which wage rates 
                        in the foreign country are determined 
                        by free bargaining between labor and 
                        management,
                          (iii) the extent to which joint 
                        ventures or other investments by firms 
                        of other foreign countries are 
                        permitted in the foreign country,
                          (iv) the extent of government 
                        ownership or control of the means of 
                        production,
                          (v) the extent of government control 
                        over the allocation of resources and 
                        over the price and output decisions of 
                        enterprises, and
                          (vi) such other factors as the 
                        administering authority considers 
                        appropriate.
                  (C) Determination in effect.--
                          (i) Any determination that a foreign 
                        country is a nonmarket economy country 
                        shall remain in effect until revoked by 
                        the administering authority.
                          (ii) The administering authority may 
                        make a determination under subparagraph 
                        (A) with respect to any foreign country 
                        at any time.
                  (D) Determinations not in issue.--
                Notwithstanding any other provision of law, any 
                determination made by the administering 
                authority under subparagraph (A) shall not be 
                subject to judicial review in any investigation 
                conducted under subtitle B.
                  (E) Collection of information.--Upon request 
                by the administering authority, the 
                Commissioner of Customs shall provide the 
                administering authority a copy of all public 
                and proprietary information submitted to, or 
                obtained by, the Commissioner of Customs that 
                the administering authority considers relevant 
                to proceedings involving merchandise from 
                nonmarket economy countries. The administering 
                authority shall protect proprietary information 
                obtained under this section from public 
                disclosure in accordance with section 777.
          (19) Equivalency of leases to sales.--In determining 
        whether a lease is equivalent to a sale for purposes of 
        this title, the administering authority shall 
        consider--
                  (A) the terms of the lease,
                  (B) commercial practice within the industry,
                  (C) the circumstances of the transaction,
                  (D) whether the product subject to the lease 
                is integrated into the operations of the lessee 
                or importer,
                  (E) whether in practice there is a likelihood 
                that the lease will be continued or renewed for 
                a significant period of time, and
                  (F) other relevant factors, including whether 
                the lease transaction would permit avoidance of 
                antidumping or countervailing duties.
          (20) Application to governmental importations.--
                  (A) In general.--Except as otherwise provided 
                by this paragraph, merchandise imported by, or 
                for the use of, a department or agency of the 
                United States Government (including merchandise 
                provided for under chapter 98 of the Harmonized 
                Tariff Schedule of the United States) is 
                subject to the imposition of countervailing 
                duties or antidumping duties under this title 
                or section 303.
                  (B) Exceptions.--Merchandise imported by, or 
                for the use of, the Department of Defense shall 
                not be subject to the imposition of 
                countervailing or antidumping duties under this 
                title if--
                          (i) the merchandise is acquired by, 
                        or for use of, such Department--
                                  (I) from a country with which 
                                such Department had a 
                                Memorandum of Understanding 
                                which was in effect on January 
                                1, 1988, and has continued to 
                                have a comparable agreement 
                                (including renewals) or 
                                superseding agreements, and
                                  (II) in accordance with terms 
                                of the Memorandum of 
                                Understanding in effect at the 
                                time of importation, or
                          (ii) the merchandise has no 
                        substantial nonmilitary use.
          (21) United states-canada agreement.--The term 
        ``United States-Canada Agreement'' means the United 
        States-Canada Free-Trade Agreement.
          (22) NAFTA.--The term ``NAFTA'' means the North 
        American Free Trade Agreement.
          (23) Entry.--The term ``entry'' includes, in 
        appropriate circumstances as determined by the 
        administering authority, a reconciliation entry created 
        under a reconciliation process, defined in section 
        401(s), that is initiated by an importer. The liability 
        of an importer under an antidumping or countervailing 
        duty proceeding for entries of merchandise subject to 
        the proceeding will attach to the corresponding 
        reconciliation entry or entries. Suspension of 
        liquidation of the reconciliation entry or entries, for 
        the purpose of enforcing this title, is equivalent to 
        the suspension of liquidation of the corresponding 
        individual entries; but the suspension of liquidation 
        of the reconciliation entry or entries for such purpose 
        does not preclude liquidation for any other purpose.
          (24) Negligible imports.--
                  (A) In general.--
                          (i) Less than 3 percent.--Except as 
                        provided in clauses (ii) and (iv), 
                        imports from a country of merchandise 
                        corresponding to a domestic like 
                        product identified by the Commission 
                        are ``negligible'' if such imports 
                        account for less than 3 percent of the 
                        volume of all such merchandise imported 
                        into the United States in the most 
                        recent 12-month period for which data 
                        are available that precedes--
                                  (I) the filing of the 
                                petition under section 702(b) 
                                or 732(b), or
                                  (II) the initiation of the 
                                investigation, if the 
                                investigation was initiated 
                                under section 702(a) or 732(a).
                          (ii) Exception.--Imports that would 
                        otherwise be negligible under clause 
                        (i) shall not be negligible if the 
                        aggregate volume of imports of the 
                        merchandise from all countries 
                        described in clause (i) with respect to 
                        which investigations were initiated on 
                        the same day exceeds 7 percent of the 
                        volume of all such merchandise imported 
                        into the United States during the 
                        applicable 12-month period.
                          (iii) Determination of aggregate 
                        volume.--In determining aggregate 
                        volume under clause (ii) or (iv), the 
                        Commission shall not consider imports 
                        from any country specified in paragraph 
                        (7)(G)(ii).
                          (iv) Negligibility in threat 
                        analysis.--Notwithstanding clauses (i) 
                        and (ii), the Commission shall not 
                        treat imports as negligible if it 
                        determines that there is a potential 
                        that imports from a country described 
                        in clause (i) will imminently account 
                        for more than 3 percent of the volume 
                        of all such merchandise imported into 
                        the United States, or that the 
                        aggregate volumes of imports from all 
                        countries described in clause (ii) will 
                        imminently exceed 7 percent of the 
                        volume of all such merchandise imported 
                        into the United States. The Commission 
                        shall consider such imports only for 
                        purposes of determining threat of 
                        material injury.
                  (B) Negligibility for certain countries in 
                countervailing duty investigations.--In the 
                case of an investigation under section 701, 
                subparagraph (A) shall be applied to imports of 
                subject merchandise from developing countries 
                by substituting ``4 percent'' for ``3 percent'' 
                in subparagraph (A)(i) and by substituting ``9 
                percent'' for ``7 percent'' in subparagraph 
                (A)(ii).
                  (C) Computation of import volumes.--In 
                computing import volumes for purposes of 
                subparagraphs (A) and (B), the Commission may 
                make reasonable estimates on the basis of 
                available statistics.
                  (D) Regional industries.--In an investigation 
                in which the Commission makes a regional 
                industry determination under paragraph (4)(C), 
                the Commission's examination under 
                subparagraphs (A) and (B) shall be based upon 
                the volume of subject merchandise exported for 
                sale in the regional market in lieu of the 
                volume of all subject merchandise imported into 
                the United States.
          (25) Subject merchandise.--The term ``subject 
        merchandise'' means the class or kind of merchandise 
        that is within the scope of an investigation, a review, 
        a suspension agreement, an order under this title or 
        section 303, or a finding under the Antidumping Act, 
        1921.
          (26) Section 303.--The terms ``section 303'' and 
        ``303'' mean section 303 of this Act as in effect on 
        the day before the effective date of title II of the 
        Uruguay Round Agreements Act.
          (27) Suspension agreement.--The term ``suspension 
        agreement'' means an agreement described in section 
        704(b), 704(c), 734(b), 734(c), or 734(l).
          (28) Exporter or producer.--The term ``exporter or 
        producer'' means the exporter of the subject 
        merchandise, the producer of the subject merchandise, 
        or both where appropriate. For purposes of section 773, 
        the term ``exporter or producer'' includes both the 
        exporter of the subject merchandise and the producer of 
        the same subject merchandise to the extent necessary to 
        accurately calculate the total amount incurred and 
        realized for costs, expenses, and profits in connection 
        with production and sale of that merchandise.
          (29) WTO agreement.--The term ``WTO Agreement'' means 
        the Agreement defined in section 2(9) of the Uruguay 
        Round Agreements Act.
          (30) WTO member and wto member country.--The terms 
        ``WTO member'' and ``WTO member country'' mean a state, 
        or separate customs territory (within the meaning of 
        Article XII of the WTO Agreement), with respect to 
        which the United States applies the WTO Agreement.
          (31) GATT 1994.--The term ``GATT 1994'' means the 
        General Agreement on Tariffs and Trade annexed to the 
        WTO Agreement.
          (32) Trade representative.--The term ``Trade 
        Representative'' means the United States Trade 
        Representative.
          (33) Affiliated persons.--The following persons shall 
        be considered to be ``affiliated'' or ``affiliated 
        persons'':
                  (A) Members of a family, including brothers 
                and sisters (whether by the whole or half 
                blood), spouse, ancestors, and lineal 
                descendants.
                  (B) Any officer or director of an 
                organization and such organization.
                  (C) Partners.
                  (D) Employer and employee.
                  (E) Any person directly or indirectly owning, 
                controlling, or holding with power to vote, 5 
                percent or more of the outstanding voting stock 
                or shares of any organization and such 
                organization.
                  (F) Two or more persons directly or 
                indirectly controlling, controlled by, or under 
                common control with, any person.
                  (G) Any person who controls any other person 
                and such other person.
        For purposes of this paragraph, a person shall be 
        considered to control another person if the person is 
        legally or operationally in a position to exercise 
        restraint or direction over the other person.
          (34) Dumped; dumping.--The terms ``dumped'' and 
        ``dumping'' refer to the sale or likely sale of goods 
        at less than fair value.
          (35) Dumping margin; weighted average dumping 
        margin.--
                  (A) Dumping margin.--The term ``dumping 
                margin'' means the amount by which the normal 
                value exceeds the export price or constructed 
                export price of the subject merchandise.
                  (B) Weighted average dumping margin.--The 
                term ``weighted average dumping margin'' is the 
                percentage determined by dividing the aggregate 
                dumping margins determined for a specific 
                exporter or producer by the aggregate export 
                prices and constructed export prices of such 
                exporter or producer.
                  (C) Magnitude of the margin of dumping.--The 
                magnitude of the margin of dumping used by the 
                Commission shall be--
                          (i) in making a preliminary 
                        determination under section 733(a) in 
                        an investigation (including any 
                        investigation in which the Commission 
                        cumulatively assesses the volume and 
                        effect of imports under paragraph 
                        (7)(G)(i)), the dumping margin or 
                        margins published by the administering 
                        authority in its notice of initiation 
                        of the investigation;
                          (ii) in making a final determination 
                        under section 735(b), the dumping 
                        margin or margins most recently 
                        published by the administering 
                        authority prior to the closing of the 
                        Commission's administrative record;
                          (iii) in a review under section 
                        751(b)(2), the most recent dumping 
                        margin or margins determined by the 
                        administering authority under section 
                        752(c)(3), if any, or under section 
                        733(b) or 735(a); and
                          (iv) in a review under section 
                        751(c), the dumping margin or margins 
                        determined by the administering 
                        authority under section 752(c)(3).
          (36) Developing and least developed country.--
                  (A) Developing country.--The term 
                ``developing country'' means a country 
                designated as a developing country by the Trade 
                Representative.
                  (B) Least developed country.--The term 
                ``least developed country'' means a country 
                which the Trade Representative determines is--
                          (i) a country referred to as a least 
                        developed country within the meaning of 
                        paragraph (a) of Annex VII to the 
                        Subsidies Agreement, or
                          (ii) any other country listed in 
                        Annex VII to the Subsidies Agreement, 
                        but only if the country has a per 
                        capita gross national product of less 
                        than $1,000 per annum as measured by 
                        the most recent data available from the 
                        World Bank.
                  (C) Publication of list.--The Trade 
                Representative shall publish in the Federal 
                Register, and update as necessary, a list of--
                          (i) developing countries that have 
                        eliminated their export subsidies on an 
                        expedited basis within the meaning of 
                        Article 27.11 of the Subsidies 
                        Agreement, and
                          (ii) countries determined by the 
                        Trade Representative to be least 
                        developed or developing countries.
                  (D) Factors to consider.--In determining 
                whether a country is a developing country under 
                subparagraph (A), the Trade Representative 
                shall consider such economic, trade, and other 
                factors which the Trade Representative 
                considers appropriate, including the level of 
                economic development of such country (the 
                assessment of which shall include a review of 
                the country's per capita gross national 
                product) and the country's share of world 
                trade.
                  (E) Limitation on designation.--A 
                determination that a country is a developing or 
                least developed country pursuant to this 
                paragraph shall be for purposes of this title 
                only and shall not affect the determination of 
                a country's status as a developing or least 
                developed country with respect to any other 
                law.

SEC. 771A. UPSTREAM SUBSIDIES.

  (a) Definition.--The term ``upstream subsidy'' means any 
countervailable subsidy, other than an export subsidy, that--
          (1) is paid or bestowed by an authority (as defined 
        in section 771(5)) with respect to a product (hereafter 
        in this section referred to as an ``input product'') 
        that is used in the same country as the authority in 
        the manufacture or production of merchandise which is 
        the subject of a countervailing duty proceeding;
          (2) in the judgment of the administering authority 
        bestows a competitive benefit on the merchandise; and
          (3) has a significant effect on the cost of 
        manufacturing or producing the merchandise.
In applying this subsection, an association of two or more 
foreign countries, political subdivisions, dependent 
territories, or possessions of foreign countries organized into 
a customs union outside the United States shall be treated as 
being one country if the countervailable subsidy is provided by 
the customs union.
  (b) Determination of Competitive Benefit.--
          (1) In general.--Except as provided in paragraph (2), 
        the administering authority shall decide that a 
        competitive benefit has been bestowed when the price 
        for the input product referred to in subsection (a)(1) 
        for such use is lower than the price that the 
        manufacturer or producer of merchandise which is the 
        subject of a countervailing duty proceeding would 
        otherwise pay for the product in obtaining it from 
        another seller in an arms-length transaction.
          (2) Adjustments.--If the administering authority has 
        determined in a previous proceeding that a 
        countervailable subsidy is paid or bestowed on the 
        input product that is used for comparison under 
        paragraph (1), the administering authority may (A) 
        where appropriate, adjust the price that the 
        manufacturer or producer of merchandise which is the 
        subject of such proceeding would otherwise pay for the 
        product to reflect the effects of the countervailable 
        subsidy, or (B) select in lieu of that price a price 
        from another source.
  (c) Inclusion of Amount of Subsidy \15\.--If the 
administering authority decides, during the course of a 
countervailing duty proceeding that an upstream countervailable 
subsidy is being or has been paid or bestowed regarding the 
subject merchandise, the administering authority shall include 
in the amount of any countervailing duty imposed on the 
merchandise an amount equal to the amount of the competitive 
benefit referred to in subparagraph (1)(B), except that in no 
event shall the amount be greater than the amount of the 
countervailable subsidy determined with respect to the upstream 
product.
---------------------------------------------------------------------------
    \15\ Section 270(a)(2)(B) of P.L. 103-465 amended ``section 
771(A)(c)'' in the heading by striking ``Subsidy'' and inserting 
``Countervailable Subsidy.''

SEC. 771B. CALCULATION OF COUNTERVAILABLE SUBSIDIES ON CERTAIN 
                    PROCESSED AGRICULTURAL PRODUCTS.

  In the case of an agricultural product processed from a raw 
agricultural product in which--
          (1) the demand for the prior stage product is 
        substantially dependent on the demand for the latter 
        stage product, and
          (2) the processing operation adds only limited value 
        to the raw commodity,
countervailable subsidies found to be provided to either 
producers or processors of the product shall be deemed to be 
provided with respect to the manufacture, production, or 
exportation of the processed product.

SEC. 772. EXPORT PRICE AND CONSTRUCTED EXPORT PRICE.

  (a) Export Price.--The term ``export price'' means the price 
at which the subject merchandise is first sold (or agreed to be 
sold) before the date of importation by the producer or 
exporter of the subject merchandise outside of the United 
States to an unaffiliated purchaser in the United States or to 
an unaffiliated purchaser for exportation to the United States, 
as adjusted under subsection (c).
  (b) Constructed Export Price.--The term ``constructed export 
price'' means the price at which the subject merchandise is 
first sold (or agreed to be sold) in the United States before 
or after the date of importation by or for the account of the 
producer or exporter of such merchandise or by a seller 
affiliated with the producer or exporter, to a purchaser not 
affiliated with the producer or exporter, as adjusted under 
subsections (c) and (d).
  (c) Adjustments for Export Price and Constructed Export 
Price.--The price used to establish export price and 
constructed export price shall be--
          (1) increased by--
                  (A) when not included in such price, the cost 
                of all containers and coverings and all other 
                costs, charges, and expenses incident to 
                placing the subject merchandise in condition 
                packed ready for shipment to the United States,
                  (B) the amount of any import duties imposed 
                by the country of exportation which have been 
                rebated, or which have not been collected, by 
                reason of the exportation of the subject 
                merchandise to the United States, and
                  (C) the amount of any countervailing duty 
                imposed on the subject merchandise under 
                subtitle A to offset an export subsidy, and
          (2) reduced by--
                  (A) except as provided in paragraph (1)(C), 
                the amount, if any, included in such price, 
                attributable to any additional costs, charges, 
                or expenses, and United States import duties, 
                which are incident to bringing the subject 
                merchandise from the original place of shipment 
                in the exporting country to the place of 
                delivery in the United States, and
                  (B) the amount, if included in such price, of 
                any export tax, duty, or other charge imposed 
                by the exporting country on the exportation of 
                the subject merchandise to the United States, 
                other than an export tax, duty, or other charge 
                described in section 771(6)(C).
  (d) Additional Adjustments to Constructed Export Price.--For 
purposes of this section, the price used to establish 
constructed export price shall also be reduced by--
          (1) the amount of any of the following expenses 
        generally incurred by or for the account of the 
        producer or exporter, or the affiliated seller in the 
        United States, in selling the subject merchandise (or 
        subject merchandise to which value has been added)--
                  (A) commissions for selling the subject 
                merchandise in the United States;
                  (B) expenses that result from, and bear a 
                direct relationship to, the sale, such as 
                credit expenses, guarantees and warranties;
                  (C) any selling expenses that the seller pays 
                on behalf of the purchaser; and
                  (D) any selling expenses not deducted under 
                subparagraph (A), (B), or (C);
          (2) the cost of any further manufacture or assembly 
        (including additional material and labor), except in 
        circumstances described in subsection (e); and
          (3) the profit allocated to the expenses described in 
        paragraphs (1) and (2).
  (e) Special Rule for Merchandise With Value Added After 
Importation.--Where the subject merchandise is imported by a 
person affiliated with the exporter or producer, and the value 
added in the United States by the affiliated person is likely 
to exceed substantially the value of the subject merchandise, 
the administering authority shall determine the constructed 
export price for such merchandise by using one of the following 
prices if there is a sufficient quantity of sales to provide a 
reasonable basis for comparison and the administering authority 
determines that the use of such sales is appropriate:
          (1) The price of identical subject merchandise sold 
        by the exporter or producer to an unaffiliated person.
          (2) The price of other subject merchandise sold by 
        the exporter or producer to an unaffiliated person.
If there is not a sufficient quantity of sales to provide a 
reasonable basis for comparison under paragraph (1) or (2), or 
the administering authority determines that neither of the 
prices described in such paragraphs is appropriate, then the 
constructed export price may be determined on any other 
reasonable basis.
  (f) Special Rule for Determining Profit.--
          (1) In general.--For purposes of subsection (d)(3), 
        profit shall be an amount determined by multiplying the 
        total actual profit by the applicable percentage.
          (2) Definitions.--For purposes of this subsection:
                  (A) Applicable percentage.--The term 
                ``applicable percentage'' means the percentage 
                determined by dividing the total United States 
                expenses by the total expenses.
                  (B) Total united states expenses.--The term 
                ``total United States expenses'' means the 
                total expenses described in subsection (d) (1) 
                and (2).
                  (C) Total expenses.--The term ``total 
                expenses'' means all expenses in the first of 
                the following categories which applies and 
                which are incurred by or on behalf of the 
                foreign producer and foreign exporter of the 
                subject merchandise and by or on behalf of the 
                United States seller affiliated with the 
                producer or exporter with respect to the 
                production and sale of such merchandise:
                          (i) The expenses incurred with 
                        respect to the subject merchandise sold 
                        in the United States and the foreign 
                        like product sold in the exporting 
                        country if such expenses were requested 
                        by the administering authority for the 
                        purpose of establishing normal value 
                        and constructed export price.
                          (ii) The expenses incurred with 
                        respect to the narrowest category of 
                        merchandise sold in the United States 
                        and the exporting country which 
                        includes the subject merchandise.
                          (iii) The expenses incurred with 
                        respect to the narrowest category of 
                        merchandise sold in all countries which 
                        includes the subject merchandise.
                  (D) Total actual profit.--The term ``total 
                actual profit'' means the total profit earned 
                by the foreign producer, exporter, and 
                affiliated parties described in subparagraph 
                (C) with respect to the sale of the same 
                merchandise for which total expenses are 
                determined under such subparagraph.

SEC. 773. NORMAL VALUE.

  (a) Determination.--In determining under this title whether 
subject merchandise is being, or is likely to be, sold at less 
than fair value, a fair comparison shall be made between the 
export price or constructed export price and normal value. In 
order to achieve a fair comparison with the export price or 
constructed export price, normal value shall be determined as 
follows:
          (1) Determination of normal value.--
                  (A) In general.--The normal value of the 
                subject merchandise shall be the price 
                described in subparagraph (B), at a time 
                reasonably corresponding to the time of the 
                sale used to determine the export price or 
                constructed export price under section 772(a) 
                or (b).
                  (B) Price.--The price referred to in 
                subparagraph (A) is--
                          (i) the price at which the foreign 
                        like product is first sold (or, in the 
                        absence of a sale, offered for sale) 
                        for consumption in the exporting 
                        country, in the usual commercial 
                        quantities and in the ordinary course 
                        of trade and, to the extent 
                        practicable, at the same level of trade 
                        as the export price or constructed 
                        export price, or
                          (ii) in a case to which subparagraph 
                        (C) applies, the price at which the 
                        foreign like product is so sold (or 
                        offered for sale) for consumption in a 
                        country other than the exporting 
                        country or the United States, if--
                                  (I) such price is 
                                representative,
                                  (II) the aggregate quantity 
                                (or, if quantity is not 
                                appropriate, value) of the 
                                foreign like product sold by 
                                the exporter or producer in 
                                such other country is 5 percent 
                                or more of the aggregate 
                                quantity (or value) of the 
                                subject merchandise sold in the 
                                United States or for export to 
                                the United States, and
                                  (III) the administering 
                                authority does not determine 
                                that the particular market 
                                situation in such other country 
                                prevents a proper comparison 
                                with the export price or 
                                constructed export price.
                  (C) Third country sales.--This subparagraph 
                applies when--
                          (i) the foreign like product is not 
                        sold (or offered for sale) for 
                        consumption in the exporting country as 
                        described in subparagraph (B)(i),
                          (ii) the administering authority 
                        determines that the aggregate quantity 
                        (or, if quantity is not appropriate, 
                        value) of the foreign like product sold 
                        in the exporting country is 
                        insufficient to permit a proper 
                        comparison with the sales of the 
                        subject merchandise to the United 
                        States, or
                          (iii) the particular market situation 
                        in the exporting country does not 
                        permit a proper comparison with the 
                        export price or constructed export 
                        price.
                For purposes of clause (ii), the aggregate 
                quantity (or value) of the foreign like product 
                sold in the exporting country shall normally be 
                considered to be insufficient if such quantity 
                (or value) is less than 5 percent of the 
                aggregate quantity (or value) of sales of the 
                subject merchandise to the United States.
          (2) Fictitious markets.--No pretended sale or offer 
        for sale, and no sale or offer for sale intended to 
        establish a fictitious market, shall be taken into 
        account in determining normal value. The occurrence of 
        different movements in the prices at which different 
        forms of the foreign like product are sold (or, in the 
        absence of sales, offered for sale) in the exporting 
        country after the issuance of an antidumping duty order 
        may be considered by the administering authority as 
        evidence of the establishment of a fictitious market 
        for the foreign like product if the movement in such 
        prices appears to reduce the amount by which the normal 
        value exceeds the export price (or the constructed 
        export price) of the subject merchandise.
          (3) Exportation from an intermediate country.--Where 
        the subject merchandise is exported to the United 
        States from an intermediate country, normal value shall 
        be determined in the intermediate country, except that 
        normal value may be determined in the country of origin 
        of the subject merchandise if--
                  (A) the producer knew at the time of the sale 
                that the subject merchandise was destined for 
                exportation;
                  (B) the subject merchandise is merely 
                transshipped through the intermediate country;
                  (C) sales of the foreign like product in the 
                intermediate country do not satisfy the 
                conditions of paragraph (1)(C); or
                  (D) the foreign like product is not produced 
                in the intermediate country.
          (4) Use of constructed value.--If the administering 
        authority determines that the normal value of the 
        subject merchandise cannot be determined under 
        paragraph (1)(B)(i), then, notwithstanding paragraph 
        (1)(B)(ii), the normal value of the subject merchandise 
        may be the constructed value of that merchandise, as 
        determined under subsection (e).
          (5) Indirect sales or offers for sale.--If the 
        foreign like product is sold or, in the absence of 
        sales, offered for sale through an affiliated party, 
        the prices at which the foreign like product is sold 
        (or offered for sale) by such affiliated party may be 
        used in determining normal value.
          (6) Adjustments.--The price described in paragraph 
        (1)(B) shall be--
                  (A) increased by the cost of all containers 
                and coverings and all other costs, charges, and 
                expenses incident to placing the subject 
                merchandise in condition packed ready for 
                shipment to the United States;
                  (B) reduced by--
                          (i) when included in the price 
                        described in paragraph (1)(B), the cost 
                        of all containers and coverings and all 
                        other costs, charges, and expenses 
                        incident to placing the foreign like 
                        product in condition packed ready for 
                        shipment to the place of delivery to 
                        the purchaser,
                          (ii) the amount, if any, included in 
                        the price described in paragraph 
                        (1)(B), attributable to any additional 
                        costs, charges, and expenses incident 
                        to bringing the foreign like product 
                        from the original place of shipment to 
                        the place of delivery to the purchaser, 
                        and
                          (iii) the amount of any taxes imposed 
                        directly upon the foreign like product 
                        or components thereof which have been 
                        rebated, or which have not been 
                        collected, on the subject merchandise, 
                        but only to the extent that such taxes 
                        are added to or included in the price 
                        of the foreign like product, and
                  (C) increased or decreased by the amount of 
                any difference (or lack thereof) between the 
                export price or constructed export price and 
                the price described in paragraph (1)(B) (other 
                than a difference for which allowance is 
                otherwise provided under this section) that is 
                established to the satisfaction of the 
                administering authority to be wholly or partly 
                due to--
                          (i) the fact that the quantities in 
                        which the subject merchandise is sold 
                        or agreed to be sold to the United 
                        States are greater than or less than 
                        the quantities in which the foreign 
                        like product is sold, agreed to be 
                        sold, or offered for sale,
                          (ii) the fact that merchandise 
                        described in subparagraph (B) or (C) of 
                        section 771(16) is used in determining 
                        normal value, or
                          (iii) other differences in the 
                        circumstances of sale.
          (7) Additional adjustments.--
                  (A) Level of trade.--The price described in 
                paragraph (1)(B) shall also be increased or 
                decreased to make due allowance for any 
                difference (or lack thereof) between the export 
                price or constructed export price and the price 
                described in paragraph (1)(B) (other than a 
                difference for which allowance is otherwise 
                made under this section) that is shown to be 
                wholly or partly due to a difference in level 
                of trade between the export price or 
                constructed export price and normal value, if 
                the difference in level of trade--
                          (i) involves the performance of 
                        different selling activities; and
                          (ii) is demonstrated to affect price 
                        comparability, based on a pattern of 
                        consistent price differences between 
                        sales at different levels of trade in 
                        the country in which normal value is 
                        determined.
                In a case described in the preceding sentence, 
                the amount of the adjustment shall be based on 
                the price differences between the two levels of 
                trade in the country in which normal value is 
                determined.
                  (B) Constructed export price offset.--When 
                normal value is established at a level of trade 
                which constitutes a more advanced stage of 
                distribution than the level of trade of the 
                constructed export price, but the data 
                available do not provide an appropriate basis 
                to determine under subparagraph (A)(ii) a level 
                of trade adjustment, normal value shall be 
                reduced by the amount of indirect selling 
                expenses incurred in the country in which 
                normal value is determined on sales of the 
                foreign like product but not more than the 
                amount of such expenses for which a deduction 
                is made under section 772(d)(1)(D).
          (8) Adjustments to constructed value.--Constructed 
        value as determined under subsection (e), may be 
        adjusted, as appropriate, pursuant to this subsection.
  (b) Sales at Less Than Cost of Production.--
          (1) Determination; sales disregarded.--Whenever the 
        administering authority has reasonable grounds to 
        believe or suspect that sales of the foreign like 
        product under consideration for the determination of 
        normal value have been made at prices which represent 
        less than the cost of production of that product, the 
        administering authority shall determine whether, in 
        fact, such sales were made at less than the cost of 
        production. If the administering authority determines 
        that sales made at less than the cost of production--
                  (A) have been made within an extended period 
                of time in substantial quantities, and
                  (B) were not at prices which permit recovery 
                of all costs within a reasonable period of 
                time,
        such sales may be disregarded in the determination of 
        normal value. Whenever such sales are disregarded, 
        normal value shall be based on the remaining sales of 
        the foreign like product in the ordinary course of 
        trade. If no sales made in the ordinary course of trade 
        remain, the normal value shall be based on the 
        constructed value of the merchandise.
          (2) Definitions and special rules.--For purposes of 
        this subsection--
                  (A) Reasonable grounds to believe or 
                suspect.--There are reasonable grounds to 
                believe or suspect that sales of the foreign 
                like product were made at prices that are less 
                than the cost of production of the product, 
                if--
                          (i) in an investigation initiated 
                        under section 732 or a review conducted 
                        under section 751, an interested party 
                        described in subparagraph (C), (D), 
                        (E), (F), or (G) of section 771(9) 
                        provides information, based upon 
                        observed prices or constructed prices 
                        or costs, that sales of the foreign 
                        like product under consideration for 
                        the determination of normal value have 
                        been made at prices which represent 
                        less than the cost of production of the 
                        product; or
                          (ii) in a review conducted under 
                        section 751 involving a specific 
                        exporter, the administering authority 
                        disregarded some or all of the 
                        exporter's sales pursuant to paragraph 
                        (1) in the investigation or if a review 
                        has been completed, in the most 
                        recently completed review.
                  (B) Extended period of time.--The term 
                ``extended period of time'' means a period that 
                is normally 1 year, but not less than 6 months.
                  (C) Substantial quantities.--Sales made at 
                prices below the cost of production have been 
                made in substantial quantities if--
                          (i) the volume of such sales 
                        represents 20 percent or more of the 
                        volume of sales under consideration for 
                        the determination of normal value, or
                          (ii) the weighted average per unit 
                        price of the sales under consideration 
                        for the determination of normal value 
                        is less than the weighted average per 
                        unit cost of production for such sales.
                  (D) Recovery of costs.--If prices which are 
                below the per unit cost of production at the 
                time of sale are above the weighted average per 
                unit cost of production for the period of 
                investigation or review, such prices shall be 
                considered to provide for recovery of costs 
                within a reasonable period of time.
          (3) Calculation of cost of production.--For purposes 
        of this subtitle, the cost of production shall be an 
        amount equal to the sum of--
                  (A) the cost of materials and of fabrication 
                or other processing of any kind employed in 
                producing the foreign like product, during a 
                period which would ordinarily permit the 
                production of that foreign like product in the 
                ordinary course of business;
                  (B) an amount for selling, general, and 
                administrative expenses based on actual data 
                pertaining to production and sales of the 
                foreign like product by the exporter in 
                question; and
                  (C) the cost of all containers and coverings 
                of whatever nature, and all other expenses 
                incidental to placing the foreign like product 
                in condition packed ready for shipment.
        For purposes of subparagraph (A), if the normal value 
        is based on the price of the foreign like product sold 
        for consumption in a country other than the exporting 
        country, the cost of materials shall be determined 
        without regard to any internal tax in the exporting 
        country imposed on such materials or their disposition 
        which are remitted or refunded upon exportation.
  (c) Nonmarket Economy Countries.--
          (1) In general.--If--
                  (A) the subject merchandise is exported from 
                a nonmarket economy country, and
                  (B) the administering authority finds that 
                available information does not permit the 
                normal value of the subject merchandise to be 
                determined under subsection (a),
        the administering authority shall determine the normal 
        value of the subject merchandise on the basis of the 
        value of the factors of production utilized in 
        producing the merchandise and to which shall be added 
        an amount for general expenses and profit plus the cost 
        of containers, coverings, and other expenses. Except as 
        provided in paragraph (2), the valuation of the factors 
        of production shall be based on the best available 
        information regarding the values of such factors in a 
        market economy country or countries considered to be 
        appropriate by the administering authority.
          (2) Exception.--If the administering authority finds 
        that the available information is inadequate for 
        purposes of determining the normal value of subject 
        merchandise under paragraph (1), the administering 
        authority shall determine the normal value on the basis 
        of the price at which merchandise that is--
                  (A) comparable to the subject merchandise, 
                and
                  (B) produced in one or more market economy 
                countries that are at a level of economic 
                development comparable to that of the nonmarket 
                economy country,
        is sold in other countries, including the United 
        States.
          (3) Factors of production.--For purposes of paragraph 
        (1), the factors of production utilized in producing 
        merchandise include, but are not limited to--
                  (A) hours of labor required,
                  (B) quantities of raw materials employed,
                  (C) amounts of energy and other utilities 
                consumed, and
                  (D) representative capital cost, including 
                depreciation.
          (4) Valuation of factors of production.--The 
        administering authority, in valuing factors of 
        production under paragraph (1), shall utilize, to the 
        extent possible, the prices or costs of factors of 
        production in one or more market economy countries that 
        are--
                  (A) at a level of economic development 
                comparable to that of the nonmarket economy 
                country, and
                  (B) significant producers of comparable 
                merchandise.
  (d) Special Rule for Certain Multinational Corporations.--
Whenever, in the course of an investigation under this title, 
the administering authority determines that--
          (1) subject merchandise exported to the United States 
        is being produced in facilities which are owned or 
        controlled, directly or indirectly, by a person, firm, 
        or corporation which also owns or controls, directly or 
        indirectly, other facilities for the production of the 
        foreign like product which are located in another 
        country or countries,
          (2) subsection (a)(1)(C) applies, and
          (3) the normal value of the foreign like product 
        produced in one or more of the facilities outside the 
        exporting country is higher than the normal value of 
        the foreign like product produced in the facilities 
        located in the exporting country,
it shall determine the normal value of the subject merchandise 
by reference to the normal value at which the foreign like 
product is sold in substantial quantities from one or more 
facilities outside the exporting country. The administering 
authority, in making any determination under this paragraph, 
shall make adjustments for the difference between the cost of 
production (including taxes, labor, materials, and overhead) of 
the foreign like product produced in facilities outside the 
exporting country and costs of production of the foreign like 
product produced in facilities in the exporting country, if 
such differences are demonstrated to its satisfaction. For 
purposes of this subsection, in determining the normal value of 
the foreign like product produced in a country outside of the 
exporting country, the administering authority shall determine 
its price at the time of exportation from the exporting country 
and shall make any adjustments required by subsection (a) for 
the cost of all containers and coverings and all other costs, 
charges, and expenses incident to placing the merchandise in 
condition packed ready for shipment to the United States by 
reference to such costs in the exporting country.
  (e) Constructed Value.--For purposes of this title, the 
constructed value of imported merchandise shall be an amount 
equal to the sum of--
          (1) the cost of materials and fabrication or other 
        processing of any kind employed in producing the 
        merchandise, during a period which would ordinarily 
        permit the production of the merchandise in the 
        ordinary course of business;
          (2)(A) the actual amounts incurred and realized by 
        the specific exporter or producer being examined in the 
        investigation or review for selling, general, and 
        administrative expenses, and for profits, in connection 
        with the production and sale of a foreign like product, 
        in the ordinary course of trade, for consumption in the 
        foreign country, or
          (B) if actual data are not available with respect to 
        the amounts described in subparagraph (A), then--
                  (i) the actual amounts incurred and realized 
                by the specific exporter or producer being 
                examined in the investigation or review for 
                selling, general, and administrative expenses, 
                and for profits, in connection with the 
                production and sale, for consumption in the 
                foreign country, of merchandise that is in the 
                same general category of products as the 
                subject merchandise,
                  (ii) the weighted average of the actual 
                amounts incurred and realized by exporters or 
                producers that are subject to the investigation 
                or review (other than the exporter or producer 
                described in clause (i)) for selling, general, 
                and administrative expenses, and for profits, 
                in connection with the production and sale of a 
                foreign like product, in the ordinary course of 
                trade, for consumption in the foreign country, 
                or
                  (iii) the amounts incurred and realized for 
                selling, general, and administrative expenses, 
                and for profits, based on any other reasonable 
                method, except that the amount allowed for 
                profit may not exceed the amount normally 
                realized by exporters or producers (other than 
                the exporter or producer described in clause 
                (i)) in connection with the sale, for 
                consumption in the foreign country, of 
                merchandise that is in the same general 
                category of products as the subject 
                merchandise; and
          (3) the cost of all containers and coverings of 
        whatever nature, and all other expenses incidental to 
        placing the subject merchandise in condition packed 
        ready for shipment to the United States.
For purposes of paragraph (1), the cost of materials shall be 
determined without regard to any internal tax in the exporting 
country imposed on such materials or their disposition which 
are remitted or refunded upon exportation of the subject 
merchandise produced from such materials.
  (f) Special Rules for Calculation of Cost of Production and 
for Calculation of Constructed Value.--For purposes of 
subsections (b) and (e).--
          (1) Costs.--
                  (A) In general.--Costs shall normally be 
                calculated based on the records of the exporter 
                or producer of the merchandise, if such records 
                are kept in accordance with the generally 
                accepted accounting principles of the exporting 
                country (or the producing country, where 
                appropriate) and reasonably reflect the costs 
                associated with the production and sale of the 
                merchandise. The administering authority shall 
                consider all available evidence on the proper 
                allocation of costs, including that which is 
                made available by the exporter or producer on a 
                timely basis, if such allocations have been 
                historically used by the exporter or producer, 
                in particular for establishing appropriate 
                amortization and depreciation periods, and 
                allowances for capital expenditures and other 
                development costs.
                  (B) Nonrecurring costs.--Costs shall be 
                adjusted appropriately for those nonrecurring 
                costs that benefit current or future 
                production, or both.
                  (C) Startup costs.--
                          (i) In general.--Costs shall be 
                        adjusted appropriately for 
                        circumstances in which costs incurred 
                        during the time period covered by the 
                        investigation or review are affected by 
                        startup operations.
                          (ii) Startup operations.--Adjustments 
                        shall be made for startup operations 
                        only where--
                                  (I) a producer is using new 
                                production facilities or 
                                producing a new product that 
                                requires substantial additional 
                                investment, and
                                  (II) production levels are 
                                limited by technical factors 
                                associated with the initial 
                                phase of commercial production.
                        For purposes of subclause (II), the 
                        initial phase of commercial production 
                        ends at the end of the startup period. 
                        In determining whether commercial 
                        production levels have been achieved, 
                        the administering authority shall 
                        consider factors unrelated to startup 
                        operations that might affect the volume 
                        of production processed, such as 
                        demand, seasonality, or business 
                        cycles.
                          (iii) Adjustment for startup 
                        operations.--The adjustment for startup 
                        operations shall be made by 
                        substituting the unit production costs 
                        incurred with respect to the 
                        merchandise at the end of the startup 
                        period for the unit production costs 
                        incurred during the startup period. If 
                        the startup period extends beyond the 
                        period of the investigation or review 
                        under this title, the administering 
                        authority shall use the most recent 
                        cost of production data that it 
                        reasonably can obtain, analyze, and 
                        verify without delaying the timely 
                        completion of the investigation or 
                        review. For purposes of this 
                        subparagraph, the startup period ends 
                        at the point at which the level of 
                        commercial production that is 
                        characteristic of the merchandise, 
                        producer, or industry concerned is 
                        achieved.
          (2) Transactions disregarded.--A transaction directly 
        or indirectly between affiliated persons may be 
        disregarded if, in the case of any element of value 
        required to be considered, the amount representing that 
        element does not fairly reflect the amount usually 
        reflected in sales of merchandise under consideration 
        in the market under consideration. If a transaction is 
        disregarded under the preceding sentence and no other 
        transactions are available for consideration, the 
        determination of the amount shall be based on the 
        information available as to what the amount would have 
        been if the transaction had occurred between persons 
        who are not affiliated.
          (3) Major input rule.--If, in the case of a 
        transaction between affiliated persons involving the 
        production by one of such persons of a major input to 
        the merchandise, the administering authority has 
        reasonable grounds to believe or suspect that an amount 
        represented as the value of such input is less than the 
        cost of production of such input, then the 
        administering authority may determine the value of the 
        major input on the basis of the information available 
        regarding such cost of production, if such cost is 
        greater than the amount that would be determined for 
        such input under paragraph (2).

SEC. 773A. CURRENCY CONVERSION.

  (a) In General.--In an antidumping proceeding under this 
title, the administering authority shall convert foreign 
currencies into United States dollars using the exchange rate 
in effect on the date of sale of the subject merchandise, 
except that, if it is established that a currency transaction 
on forward markets is directly linked to an export sale under 
consideration, the exchange rate specified with respect to such 
currency in the forward sale agreement shall be used to convert 
the foreign currency. Fluctuations in exchange rates shall be 
ignored.
  (b) Sustained Movement in Foreign Currency Value.--In an 
investigation under subtitle B, if there is a sustained 
movement in the value of the foreign currency relative to the 
United States dollar, the administering authority shall allow 
exporters at least 60 days to adjust their export prices to 
reflect such sustained movement.

SEC. 774. HEARINGS.

  (a) Investigation Hearings.--
          (1) In general.--Except as provided in paragraph (2), 
        the administering authority and the Commission shall 
        each hold a hearing in the course of an investigation 
        upon the request of any party to the investigation 
        before making a final determination under section 705 
        or 735.
          (2) Exception.--If investigations are initiated under 
        subtitle A and subtitle B regarding the same 
        merchandise from the same country within 6 months of 
        each other (but before a final determination is made in 
        either investigation), the holding of a hearing by the 
        Commission in the course of one of the investigations 
        shall be treated as compliance with paragraph (1) for 
        both investigations, unless the Commission considers 
        that special circumstances require that a hearing be 
        held in the course of each of the investigations. 
        During any investigation regarding which the holding of 
        a hearing is waived under this paragraph, the 
        Commission shall allow any party to submit such 
        additional written comment as it considers relevant.
  (b) Procedures.--Any hearing required or permitted under this 
title shall be conducted after notice published in the Federal 
Register, and a transcript of the hearing shall be prepared and 
made available to the public. The hearing shall not be subject 
to the provisions of subchapter II of chapter 5 of title 5, 
United States Code, or to section 702 of such title.

SEC. 775. COUNTERVAILABLE SUBSIDY PRACTICES DISCOVERED DURING A 
                    PROCEEDING.

  If, in the course of a proceeding under this title, the 
administering authority discovers a practice which appears to 
be a countervailable subsidy, but was not included in the 
matters alleged in a countervailing duty petition, or if the 
administering authority receives notice from the Trade 
Representative that a subsidy or subsidy program is in 
violation of Article 8 of the Subsidies Agreement, then the 
administering authority--
          (1) shall include the practice, subsidy, or subsidy 
        program in the proceeding if the practice, subsidy, or 
        subsidy program appears to be a countervailable subsidy 
        with respect to the merchandise which is the subject of 
        the proceeding, or
          (2) shall transfer the information (other than 
        confidential information) concerning the practice, 
        subsidy, or subsidy program to the library maintained 
        under section 777(a)(1), if the practice, subsidy, or 
        subsidy program appears to be a countervailable subsidy 
        with respect to any other merchandise.\16\
---------------------------------------------------------------------------
    \16\ Article 8 of the Uruguray Round Subsidies Agreement lapsed 
January 1, 2000.
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SEC. 776. DETERMINATIONS ON THE BASIS OF THE FACTS AVAILABLE.

  (a) In General.--If--
          (1) necessary information is not available on the 
        record, or
          (2) an interested party or any other person--
                  (A) withholds information that has been 
                requested by the administering authority or the 
                Commission under this title,
                  (B) fails to provide such information by the 
                deadlines for submission of the information or 
                in the form and manner requested, subject to 
                subsections (c)(1) and (e) of section 782,
                  (C) significantly impedes a proceeding under 
                this title, or
                  (D) provides such information but the 
                information cannot be verified as provided in 
                section 782(i),
the administering authority and the Commission shall, subject 
to section 782(d), use the facts otherwise available in 
reaching the applicable determination under this title.
  (b) Adverse Inferences.--If the administering authority or 
the Commission (as the case may be) finds that an interested 
party has failed to cooperate by not acting to the best of its 
ability to comply with a request for information from the 
administering authority or the Commission, the administering 
authority or the Commission (as the case may be), in reaching 
the applicable determination under this title, may use an 
inference that is adverse to the interests of that party in 
selecting from among the facts otherwise available. Such 
adverse inference may include reliance on information derived 
from--
          (1) the petition,
          (2) a final determination in the investigation under 
        this title,
          (3) any previous review under section 751 or 
        determination under section 753, or
          (4) any other information placed on the record.
  (c) Corroboration of Secondary Information.--When the 
administering authority or the Commission relies on secondary 
information rather than on information obtained in the course 
of an investigation or review, the administering authority or 
the Commission, as the case may be, shall, to the extent 
practicable, corroborate that information from independent 
sources that are reasonably at their disposal.

SEC. 777. ACCESS TO INFORMATION.

  (a) Information Generally Made Available.--
          (1) Public information function.--There shall be 
        established a library of information relating to 
        foreign subsidy practices and countervailing measures. 
        Copies of material in the library shall be made 
        available to the public upon payment of the costs of 
        preparing such copies.
          (2) Progress of investigation reports.--The 
        administering authority and the Commission shall, from 
        time to time upon request, inform the parties to an 
        investigation of the progress of that investigation.
          (3) Ex parte meetings.--The administering authority 
        and the Commission shall maintain a record of any ex 
        parte meeting between--
                  (A) interested parties or other persons 
                providing factual information in connection 
                with a proceeding, and
                  (B) the person charged with making the 
                determination, or any person charged with 
                making a final recommendation to that person, 
                in connection with that proceeding,
        if information relating to that proceeding was 
        presented or discussed at such meeting. The record of 
        such an ex parte meeting shall include the identity of 
        the persons present at the meeting, the date, time, and 
        place of the meeting, and a summary of the matters 
        discussed or submitted. The record of the ex parte 
        meeting shall be included in the record of the 
        proceeding.
          (4) Summaries; non-proprietary submissions.--The 
        administering authority and the Commission shall 
        disclose--
                  (A) any proprietary information received in 
                the course of a proceeding if it is disclosed 
                in a form which cannot be associated with, or 
                otherwise be used to identify, operations of a 
                particular person, and
                  (B) any information submitted in connection 
                with a proceeding which is not designated as 
                proprietary by the person submitting it.
  (b) Proprietary Information.--
          (1) Proprietary status maintained.--
                  (A) In general.--Except as provided in 
                subsection (a)(4)(A) and subsection (c), 
                information submitted to the administering 
                authority or the Commission which is designated 
                as proprietary by the person submitting the 
                information shall not be disclosed to any 
                person without the consent of the person 
                submitting the information, other than--
                          (i) to an officer or employee of the 
                        administering authority or the 
                        Commission who is directly concerned 
                        with carrying out the investigation in 
                        connection with which the information 
                        is submitted or any review under this 
                        title covering the same subject 
                        merchandise, or
                          (ii) to an officer or employee of the 
                        United States Customs Service who is 
                        directly involved in conducting an 
                        investigation regarding fraud under 
                        this title.
                  (B) Additional requirements.--The 
                administering authority and the Commission 
                shall require that information for which 
                proprietary treatment is requested be 
                accompanied by--
                          (i) either--
                                  (I) a non-proprietary summary 
                                in sufficient detail to permit 
                                a reasonable understanding of 
                                the substance of the 
                                information submitted in 
                                confidence, or
                                  (II) a statement that the 
                                information is not susceptible 
                                to summary accompanied by a 
                                statement of the reasons in 
                                support of the contention, and
                          (ii) either--
                                  (I) a statement which permits 
                                the administering authority or 
                                the Commission to release under 
                                administrative protective 
                                order, in accordance with 
                                subsection (c), the information 
                                submitted in confidence, or
                                  (II) a statement to the 
                                administering authority or the 
                                Commission that the business 
                                proprietary information is of a 
                                type that should not be 
                                released under administrative 
                                protective order.
          (2) Unwarranted designation.--If the administering 
        authority or the Commission determines, on the basis of 
        the nature and extent of the information or its 
        availability from public sources, that designation of 
        any information as proprietary is unwarranted, then it 
        shall notify the person who submitted it and ask for an 
        explanation of the reasons for the designation. Unless 
        that person persuades the administering authority or 
        the Commission that the designation is warranted, or 
        withdraws the designation, the administering authority 
        or the Commission, as the case may be, shall return it 
        to the party submitting it. In a case in which the 
        administering authority or the Commission returns the 
        information to the person submitting it, the person may 
        thereafter submit other material concerning the subject 
        matter of the returned information if the submission is 
        made within the time otherwise provided for submitting 
        such material.
          (3) Section 751 reviews.--Notwithstanding the 
        provisions of paragraph (1), information submitted to 
        the administering authority or the Commission in 
        connection with a review under section 751(b) or 751(c) 
        which is designated as proprietary by the person 
        submitting the information may, if the review results 
        in the revocation of an order or finding (or 
        termination of a suspended investigation) under section 
        751(d), be used by the agency to which the information 
        was originally submitted in any investigation initiated 
        within 2 years after the date of the revocation or 
        termination pursuant to a petition covering the same 
        subject merchandise.
  (c) Limited Disclosure of Certain Proprietary Information 
Under Protective Order.--
          (1) Disclosure by administering authority or 
        commission.--
                  (A) In general.--Upon receipt of an 
                application (before or after receipt of the 
                information requested) which describes in 
                general terms the information requested and 
                sets forth the reasons for the request, the 
                administering authority or the Commission shall 
                make all business proprietary information 
                presented to, or obtained by it, during a 
                proceeding (except privileged information, 
                classified information, and specific 
                information of a type for which there is a 
                clear and compelling need to withhold from 
                disclosure) available to interested parties who 
                are parties to the proceeding under a 
                protective order described in subparagraph (B), 
                regardless of when the information is submitted 
                during a proceeding. Customer names obtained 
                during any investigation which requires a 
                determination under section 705(b) or 735(b) 
                may not be disclosed by the administering 
                authority under protective order until either 
                an order is published under section 706(a) or 
                736(a) as a result of the investigation or the 
                investigation is suspended or terminated. The 
                Commission may delay disclosure of customer 
                names under protective order during any such 
                investigation until a reasonable time prior to 
                any hearing provided under section 774.
                  (B) Protective order.--The protective order 
                under which information is made available shall 
                contain such requirements as the administering 
                authority or the Commission may determine by 
                regulation to be appropriate. The administering 
                authority and the Commission shall provide by 
                regulation for such sanctions as the 
                administering authority and the Commission 
                determine to be appropriate, including 
                disbarment from practice before the agency.
                  (C) Time limitation on determinations.--The 
                administering authority or the Commission, as 
                the case may be, shall determine whether to 
                make information available under this 
                paragraph--
                          (i) not later than 14 days (7 days if 
                        the submission pertains to a proceeding 
                        under section 703(a) or 733(a)) after 
                        the date on which the information is 
                        submitted, or
                          (ii) if--
                                  (I) the person that submitted 
                                the information raises 
                                objection to its release, or
                                  (II) the information is 
                                unusually voluminous or 
                                complex,
                        not later than 30 days (10 days if the 
                        submission pertains to a proceeding 
                        under section 703(a) or 733(a)) after 
                        the date on which the information is 
                        submitted.
                  (D) Availability after determination.--If the 
                determination under subparagraph (C) is 
                affirmative, then--
                          (i) the business proprietary 
                        information submitted to the 
                        administering authority or the 
                        Commission on or before the date of the 
                        determination shall be made available, 
                        subject to the terms and conditions of 
                        the protective order, on such date; and
                          (ii) the business proprietary 
                        information submitted to the 
                        administering authority or the 
                        Commission after the date of the 
                        determination shall be served as 
                        required by subsection (d).
                  (E) Failure to disclose.--If a person 
                submitting information to the administering 
                authority refuses to disclose business 
                proprietary information which the administering 
                authority determines should be released under a 
                protective order described in subparagraph (B), 
                the administering authority shall return the 
                information, and any nonconfidential summary 
                thereof, to the person submitting the 
                information and summary and shall not consider 
                either.
          (2) Disclosure under court order.--If the 
        administering authority denies a request for 
        information under paragraph (1), then application may 
        be made to the United States Customs Court for an order 
        directing the administering authority or the Commission 
        to make the information available. After notification 
        of all parties to the investigation and after an 
        opportunity for a hearing on the record, the court may 
        issue an order, under such conditions as the court 
        deems appropriate, which shall not have the effect of 
        stopping or suspending the investigation, directing the 
        administering authority or the Commission to make all 
        or a portion of the requested information described in 
        the preceding sentence available under a protective 
        order and setting forth sanctions for violation of such 
        order if the court finds that, under the standards 
        applicable in proceedings of the court, such an order 
        is warranted, and that--
                  (A) the administering authority or the 
                Commission has denied access to the information 
                under subsection (b)(1),
                  (B) the person on whose behalf the 
                information is requested is an interested party 
                who is a party to the investigation in 
                connection with which the information was 
                obtained or developed, and
                  (C) the party which submitted the information 
                to which the request relates has been notified, 
                in advance of the hearing, of the request made 
                under this section and of its right to appear 
                and be heard.
  (d) Service.--Any party submitting written information, 
including business proprietary information, to the 
administering authority or the Commission during a proceeding 
shall, at the same time, serve the information upon all 
interested parties who are parties to the proceeding, if the 
information is covered by a protective order. The administering 
authority or the Commission shall not accept any such 
information that is not accompanied by a certificate of service 
and a copy of the protective order version of the document 
containing the information. Business proprietary information 
shall only be served upon interested parties who are parties to 
the proceeding that are subject to protective order; however, a 
nonconfidential summary thereof shall be served upon all other 
interested parties who are parties to the proceeding.
  (e) [Repealed.]
  (f) Disclosure of Proprietary Information Under Protective 
Orders Issued Pursuant to the North American Free Trade 
Agreement or the United States-Canada Agreement.--
          (1) Issuance of protective orders.--
                  (A) In general.--If binational panel review 
                of a determination under this title is 
                requested pursuant to article 1904 of the NAFTA 
                or the United States-Canada Agreement, or an 
                extraordinary challenge committee is convened 
                under Annex 1904.13 of the NAFTA or the United 
                States-Canada Agreement, the administering 
                authority or the Commission, as appropriate, 
                may make available to authorized persons, under 
                a protective order described in paragraph (2), 
                a copy of all proprietary material in the 
                administrative record made during the 
                proceeding in question. If the administrating 
                authority or the Commission claims a privilege 
                as to a document or portion of a document in 
                the administrative record of the proceeding in 
                question and a binational panel or 
                extraordinary challenge committee finds that in 
                camera inspection or limited disclosure of that 
                document or portion thereof is required by 
                United States law, the administering authority 
                or the Commission, as appropriate, may restrict 
                access to such document or portion thereof to 
                the authorized persons identified by the panel 
                or committee as requiring access and may 
                require such persons to obtain access under a 
                protective order described in paragraph (2).
                  (B) Authorized persons.--For purposes of this 
                subsection, the term ``authorized persons'' 
                means--
                          (i) the members of, and the 
                        appropriate staff of, the binational 
                        panel or the extraordinary challenge 
                        committee, as the case may be, and the 
                        Secretariat,
                          (ii) counsel for parties to such 
                        panel or committee proceeding, and 
                        employees, and persons under the 
                        direction and control, of such counsel,
                          (iii) any officer or employee of the 
                        United States Government designated by 
                        the administering authority or the 
                        Commission, as appropriate, to whom 
                        disclosure is necessary in order to 
                        make recommendations to the Trade 
                        Representative regarding the convening 
                        of extraordinary challenge committees 
                        under chapter 19 of the NAFTA or the 
                        Agreement, and
                          (iv) any officer or employee of the 
                        Government of a free trade area country 
                        (as defined in section 516A(f)(10)) 
                        designated by an authorized agency of 
                        such country to whom disclosure is 
                        necessary in order to make decisions 
                        regarding the convening of 
                        extraordinary challenge committees 
                        under chapter 19 of the NAFTA or the 
                        Agreement.
                  (C) Review.--A decision concerning the 
                disclosure or nondisclosure of material under 
                protective order by the administering authority 
                or the Commission shall not be subject to 
                judicial review, and no court of the United 
                States shall have power or jurisdiction to 
                review such decision on any question of law or 
                fact by an action in the nature of mandamus or 
                otherwise.
          (2) Contents of protective order.--Each protective 
        order issued under this subsection shall be in such 
        form and contain such requirements as the administering 
        authority or the Commission may determine by regulation 
        to be appropriate. The administering authority and the 
        Commission shall ensure that regulations issued 
        pursuant to this paragraph shall be designed to provide 
        an opportunity for participation in the binational 
        panel proceeding, including any extraordinary 
        challenge, equivalent to that available for judicial 
        review of determinations by the administering authority 
        or the Commission that are not subject to review by a 
        binational panel.
          (3) Prohibited acts.--It is unlawful for any person 
        to violate, to induce the violation of, or knowingly to 
        receive information the receipt of which constitutes a 
        violation of, any provision of a protective order 
        issued under this subsection or to violate, to induce 
        the violation of, or knowingly to receive information 
        the receipt of which constitutes a violation of, any 
        provision of an undertaking entered into with an 
        authorized agency of a free trade area country (as 
        defined in section 516A(f)(10)) to protect proprietary 
        material during binational panel or extraordinary 
        challenge committee review pursuant to article 1904 of 
        the NAFTA or the United States-Canada Agreement.
          (4) Sanctions for violation of protective orders.--
        Any person, except a judge appointed to a binational 
        panel or an extraordinary challenge committee under 
        section 402(b) of the North American Free Trade 
        Agreement Implementation Act, who is found by the 
        administering authority or the Commission, as 
        appropriate, after notice and an opportunity for a 
        hearing in accordance with section 554 of title 5, 
        United States Code, to have committed an act prohibited 
        by paragraph (3) shall be liable to the United States 
        for a civil penalty and shall be subject to such other 
        administrative sanctions, including, but not limited 
        to, debarment from practice before the administering 
        authority or the Commission, as the administering 
        authority or the Commission determines to be 
        appropriate. The amount of the civil penalty shall not 
        exceed $100,000 for each violation. Each day of a 
        continuing violation shall constitute a separate 
        violation. The amount of such civil penalty and other 
        sanctions shall be assessed by the administering 
        authority or the Commission by written notice, except 
        that assessment shall be made by the administering 
        authority for violation, or inducement of a violation 
        or receipt of information with reason to know that such 
        information was disclosed in violation, of an 
        undertaking entered into by any person with an 
        authorized agency of a free trade area country (as 
        defined in section 516A(f)(10)).
          (5) Review of sanctions.--Any person against whom 
        sanctions are imposed under paragraph (4) may obtain 
        review of such sanctions by filing a notice of appeal 
        in the United States Court of International Trade 
        within 30 days from the date of the order imposing the 
        sanction and by simultaneously sending a copy of such 
        notice by certified mail to the administering authority 
        or the Commission, as appropriate. The administering 
        authority or the Commission shall promptly file in such 
        court a certified copy of the record upon which such 
        violation was found or such sanction imposed, as 
        provided in section 2112 of title 28, United States 
        Code. The findings and order of the administering 
        authority or the Commission shall be set aside by the 
        court only if the court finds that such findings and 
        order are not supported by substantial evidence, as 
        provided in section 706(2) of title 5, United States 
        Code.
          (6) Enforcement of sanctions.--If any person fails to 
        pay an assessment of a civil penalty or to comply with 
        other administrative sanctions after the order imposing 
        such sanctions becomes a final and unappealable order, 
        or after the United States Court of International Trade 
        has entered final judgment in favor of the 
        administering authority or the Commission, an action 
        may be filed in such court to enforce the sanctions. In 
        such action, the validity and appropriateness of the 
        final order imposing the sanctions shall not be subject 
        to review.
          (7) Testimony and production of papers.--
                  (A) Authority to obtain information.--For the 
                purpose of conducting any hearing and carrying 
                out other functions and duties under this 
                subsection, the administering authority and the 
                Commission, or their duly authorized agents--
                          (i) shall have access to and the 
                        right to copy any pertinent document, 
                        paper, or record in the possession of 
                        any individual, partnership, 
                        corporation, association, organization, 
                        or other entity,
                          (ii) may summon witnesses, take 
                        testimony, and administer oaths,
                          (iii) and may require any individual 
                        or entity to produce pertinent 
                        documents, books, or records.
                Any member of the Commission, and any person so 
                designated by the administering authority, may 
                sign subpoenas, and members and agents of the 
                administering authority and the Commission, 
                when authorized by the administering authority 
                or the Commission, as appropriate, may 
                administer oaths and affirmations, examine 
                witnesses, take testimony, and receive 
                evidence.
                  (B) Witnesses and evidence.--The attendance 
                of witnesses who are authorized to be summoned, 
                and the production of documentary evidence 
                authorized to be ordered, under subparagraph 
                (A) may be required from any place in the 
                United States at any designated place of 
                hearing. In the case of disobedience to a 
                subpoena issued under subparagraph (A), an 
                action may be filed in any district or 
                territorial court of the United States to 
                require the attendance and testimony of 
                witnesses and the production of documentary 
                evidence. Such court, within the jurisdiction 
                of which such inquiry is carried on, may, in 
                case of contumacy or refusal to obey a subpoena 
                issued to any individual, partnership, 
                corporation, association, organization or other 
                entity, issue any order requiring such 
                individual or entity to appear before the 
                administering authority or the Commission, or 
                to produce documentary evidence if so ordered 
                or to give evidence concerning the matter in 
                question. Any failure to obey such order of the 
                court may be punished by the court as a 
                contempt thereof.
                  (C) Mandamus.--Any court referred to in 
                subparagraph (B) shall have jurisdiction to 
                issue writs of mandamus commanding compliance 
                with the provisions of this subsection or any 
                order of the administering authority or the 
                Commission made in pursuance thereof.
                  (D) Depositions.--For purposes of carrying 
                out any functions or duties under this 
                subsection, the administering authority or the 
                Commission may order testimony to be taken by 
                deposition. Such deposition may be taken before 
                any person designated by the administering 
                authority or Commission and having power to 
                administer oaths. Such testimony shall be 
                reduced to writing by the person taking the 
                deposition, or under the direction of such 
                person, and shall then be subscribed by the 
                deponent. Any individual, partnership, 
                corporation, association, organization or other 
                entity may be compelled to appear and depose 
                and to produce documentary evidence in the same 
                manner as witnesses may be compelled to appear 
                and testify and produce documentary evidence 
                before the administering authority or 
                Commission, as provided in this paragraph.
                  (E) Fees and mileage of witnesses.--Witnesses 
                summoned before the administering authority or 
                the Commission shall be paid the same fees and 
                mileage that are paid witnesses in the courts 
                of the United States.
  (g) Information Relating to Violations of Protective Orders 
and Sanctions.--The administering authority and the Commission 
may withhold from disclosure any correspondence, private 
letters of reprimand, settlement agreements, and documents and 
files compiled in relation to investigations and actions 
involving a violation or possible violation of a protective 
order issued under subsection (c) or (d), and such information 
shall be treated as information described in section 552(b)(3) 
of title 5, United States Code.
  (h) Opportunity for Comment by Consumers and Industrial 
Users.--The administering authority and the Commission shall 
provide an opportunity for industrial users of the subject 
merchandise and, if the merchandise is sold at the retail 
level, for representative consumer organizations, to submit 
relevant information to the administering authority concerning 
dumping or a countervailable subsidy, and to the Commission 
concerning material injury by reason of dumped or subsidized 
imports.
  (i) Publication of Determinations; Requirements for Final 
Determinations.--
          (1) In general.--Whenever the administering authority 
        makes a determination under section 702 or 732 whether 
        to initiate an investigation, or the administering 
        authority or the Commission makes a preliminary 
        determination under section 703 or 733, a final 
        determination under section 705 or section 735, a 
        preliminary or final determination in a review under 
        section 751, a determination to suspend an 
        investigation under this title, or a determination 
        under section 753, the administering authority or the 
        Commission, as the case may be, shall publish the facts 
        and conclusions supporting that determination, and 
        shall publish notice of that determination in the 
        Federal Register.
          (2) Contents of notice or determination.--The notice 
        or determination published under paragraph (1) shall 
        include, to the extent applicable--
                  (A) in the case of a determination of the 
                administering authority--
                          (i) the names of the exporters or 
                        producers of the subject merchandise 
                        or, when providing such names is 
                        impracticable, the countries exporting 
                        the subject merchandise to the United 
                        States,
                          (ii) a description of the subject 
                        merchandise that is sufficient to 
                        identify the subject merchandise for 
                        customs purposes,
                          (iii)(I) with respect to a 
                        determination in an investigation under 
                        subtitle A or section 753 or in a 
                        review of a countervailing duty order, 
                        the amount of the countervailable 
                        subsidy established and a full 
                        explanation of the methodology used in 
                        establishing the amount, and
                          (II) with respect to a determination 
                        in an investigation under subtitle B or 
                        in a review of an antidumping duty 
                        order, the weighted average dumping 
                        margins established and a full 
                        explanation of the methodology used in 
                        establishing such margins, and
                          (iv) the primary reasons for the 
                        determination; and
                  (B) in the case of a determination of the 
                Commission--
                          (i) considerations relevant to the 
                        determination of injury, and
                          (ii) the primary reasons for the 
                        determination.
          (3) Additional requirements for final 
        determinations.--In addition to the requirements set 
        forth in paragraph (2)--
                  (A) the administering authority shall include 
                in a final determination described in paragraph 
                (1) an explanation of the basis for its 
                determination that addresses relevant 
                arguments, made by interested parties who are 
                parties to the investigation or review (as the 
                case may be), concerning the establishment of 
                dumping or a countervailable subsidy, or the 
                suspension of the investigation, with respect 
                to which the determination is made; and
                  (B) the Commission shall include in a final 
                determination of injury an explanation of the 
                basis for its determination that addresses 
                relevant arguments that are made by interested 
                parties who are parties to the investigation or 
                review (as the case may be) concerning volume, 
                price effects, and impact on the industry of 
                imports of the subject merchandise.

SEC. 777A. SAMPLING AND AVERAGING; DETERMINATION OF WEIGHTED AVERAGE 
                    DUMPING MARGIN AND COUNTERVAILABLE SUBSIDY RATE.

  (a) In General.--For purposes of determining the export price 
(or constructed export price) under section 772 or the normal 
value under section 773, and in carrying out reviews under 
section 751, the administering authority may--
          (1) use averaging and statistically valid samples, if 
        there is a significant volume of sales of the subject 
        merchandise or a significant number or types of 
        products, and
          (2) decline to take into account adjustments which 
        are insignificant in relation to the price or value of 
        the merchandise.
  (b) Selection of Averages and Samples.--The authority to 
select averages and statistically valid samples shall rest 
exclusively with the administering authority. The administering 
authority shall, to the greatest extent possible, consult with 
the exporters and producers regarding the method to be used to 
select exporters, producers, or types of products under this 
section.
  (c) Determination of Dumping Margin.--
          (1) General rule.--In determining weighted average 
        dumping margins under section 733(d), 735(c), or 
        751(a), the administering authority shall determine the 
        individual weighted average dumping margin for each 
        known exporter and producer of the subject merchandise.
          (2) Exception.--If it is not practicable to make 
        individual weighted average dumping margin 
        determinations under paragraph (1) because of the large 
        number of exporters or producers involved in the 
        investigation or review, the administering authority 
        may determine the weighted average dumping margins for 
        a reasonable number of exporters or producers by 
        limiting its examination to--
                  (A) a sample of exporters, producers, or 
                types of products that is statistically valid 
                based on the information available to the 
                administering authority at the time of 
                selection, or
                  (B) exporters and producers accounting for 
                the largest volume of the subject merchandise 
                from the exporting country that can be 
                reasonably examined.
  (d) Determination of Less Than Fair Value.--
          (1) Investigations.--
                  (A) In general.--In an investigation under 
                subtitle B, the administering authority shall 
                determine whether the subject merchandise is 
                being sold in the United States at less than 
                fair value--
                          (i) by comparing the weighted average 
                        of the normal values to the weighted 
                        average of the export prices (and 
                        constructed export prices) for 
                        comparable merchandise, or
                          (ii) by comparing the normal values 
                        of individual transactions to the 
                        export prices (or constructed export 
                        prices) of individual transactions for 
                        comparable merchandise.
                  (B) Exception.--The administering authority 
                may determine whether the subject merchandise 
                is being sold in the United States at less than 
                fair value by comparing the weighted average of 
                the normal values to the export prices (or 
                constructed export prices) of individual 
                transactions for comparable merchandise, if--
                          (i) there is a pattern of export 
                        prices (or constructed export prices) 
                        for comparable merchandise that differ 
                        significantly among purchasers, 
                        regions, or periods of time, and
                          (ii) the administering authority 
                        explains why such differences cannot be 
                        taken into account using a method 
                        described in paragraph (1)(A)(i) or 
                        (ii).
          (2) Reviews.--In a review under section 751, when 
        comparing export prices (or constructed export prices) 
        of individual transactions to the weighted average 
        price of sales of the foreign like product, the 
        administering authority shall limit its averaging of 
        prices to a period not exceeding the calendar month 
        that corresponds most closely to the calendar month of 
        the individual export sale.
  (e) Determination of Countervailable Subsidy Rate.--
          (1) General rule.--In determining countervailable 
        subsidy rates under section 703(d), 705(c), or 751(a), 
        the administering authority shall determine an 
        individual countervailable subsidy rate for each known 
        exporter or producer of the subject merchandise.
          (2) Exception.--If the administering authority 
        determines that it is not practicable to determine 
        individual countervailable subsidy rates under 
        paragraph (1) because of the large number of exporters 
        or producers involved in the investigation or review, 
        the administering authority may--
                  (A) determine individual countervailable 
                subsidy rates for a reasonable number of 
                exporters or producers by limiting its 
                examination to--
                          (i) a sample of exporters or 
                        producers that the administering 
                        authority determines is statistically 
                        valid based on the information 
                        available to the administering 
                        authority at the time of selection, or
                          (ii) exporters and producers 
                        accounting for the largest volume of 
                        the subject merchandise from the 
                        exporting country that the 
                        administering authority determines can 
                        be reasonably examined; or
                  (B) determine a single country-wide subsidy 
                rate to be applied to all exporters and 
                producers.
        The individual countervailable subsidy rates determined 
        under subparagraph (A) shall be used to determine the 
        all-others rate under section 705(c)(5).

SEC. 778. INTEREST ON CERTAIN OVERPAYMENTS AND UNDERPAYMENTS.

  (a) General Rule.--Interest shall be payable on overpayments 
and underpayments of amounts deposited on merchandise entered, 
or withdrawn from warehouse, for consumption on and after--
          (1) the date of publication of a countervailing or 
        antidumping duty order under this title or section 303, 
        or
          (2) the date of a finding under the Antidumping Act, 
        1921.
  (b) Rate.--The rate of interest payable under subsection (a) 
for any period of time is the rate of interest established 
under section 6621 of the Internal Revenue Code of 1954 for 
such period.

SEC. 779. DRAWBACK TREATMENT.

  For purposes of any law relating to the drawback of customs 
duties, countervailing duties and antidumping duties imposed by 
this title shall not be treated as being regular customs 
duties.

SEC. 780. DOWNSTREAM PRODUCT MONITORING.

  (a) Petition Requesting Monitoring.--
          (1) In general.--A domestic producer of an article 
        that is like a component part or a downstream product 
        may petition the administering authority to designate a 
        downstream product for monitoring under subsection (b). 
        The petition shall specify--
                  (A) the downstream product,
                  (B) the component product incorporated into 
                such downstream product, and
                  (C) the reasons for suspecting that the 
                imposition of antidumping or countervailing 
                duties has resulted in a diversion of exports 
                of the component part into increased production 
                and exportation to the United States of such 
                downstream product.
          (2) Determination regarding petition.--Within 14 days 
        after receiving a petition submitted under paragraph 
        (1), the administering authority shall determine--
                  (A) whether there is a reasonable likelihood 
                that imports into the United States of the 
                downstream product will increase as an indirect 
                result of any diversion with respect to the 
                component part, and
                  (B) whether--
                          (i) the component part is already 
                        subject to monitoring to aid in the 
                        enforcement of a bilateral arrangement 
                        (within the meaning of section 804 of 
                        the Trade and Tariff Act of 1984),
                          (ii) merchandise related to the 
                        component part and manufactured in the 
                        same foreign country in which the 
                        component part is manufactured has been 
                        the subject of a significant number of 
                        investigations suspended under section 
                        704 or 734 or countervailing or 
                        antidumping duty orders issued under 
                        this title or section 303, or
                          (iii) merchandise manufactured or 
                        exported by the manufacturer or 
                        exporter of the component part that is 
                        similar in description and use to the 
                        component part has been the subject of 
                        at least 2 investigations suspended 
                        under section 704 or 734 or 
                        countervailing or antidumping duty 
                        orders issued under this title or 
                        section 303.
          (3) Factors to take into account.--In making a 
        determination under paragraph (2)(A), the administering 
        authority may, if appropriate, take into account such 
        factors as--
                  (A) the value of the component part in 
                relation to the value of the downstream 
                product,
                  (B) the extent to which the component part 
                has been substantially transformed as a result 
                of its incorporation into the downstream 
                product, and
                  (C) the relationship between the producers of 
                component parts and producers of downstream 
                products.
          (4) Publication of determination.--The administering 
        authority shall publish in the Federal Register notice 
        of each determination made under paragraph (2) and, if 
        the determination made under paragraph (2)(A) and a 
        determination made under any subparagraph of paragraph 
        (2)(B) are affirmative, shall transmit a copy of such 
        determinations and the petition to the Commission.
          (5) Determinations not subject to judicial review.--
        Notwithstanding any other provision of law, any 
        determination made by the administering authority under 
        paragraph (2) shall not be subject to judicial review.
  (b) Monitoring by the Commission.--
          (1) In general.--If the determination made under 
        subsection (a)(2)(A) and a determination made under any 
        clause of subsection (a)(2)(B) with respect to a 
        petition are affirmative, the Commission shall 
        immediately commence monitoring of trade in the 
        downstream product that is the subject of the 
        determination made under subsection (a)(2)(A). If the 
        Commission finds that imports of a downstream product 
        being monitored increased during any calendar quarter 
        by 5 percent or more over the preceding quarter, the 
        Commission shall analyze that increase in the context 
        of overall economic conditions in the product sector.
          (2) Reports.--The Commission shall make quarterly 
        reports to the administering authority regarding the 
        monitoring and analyses conducted under paragraph (1). 
        The Commission shall make the reports available to the 
        public.
  (c) Action on Basis of Monitoring Reports.--The administering 
authority shall review the information in the reports submitted 
by the Commission under subsection (b)(2) and shall--
          (1) consider the information in determining whether 
        to initiate an investigation under section 702(a) or 
        732(a) regarding any downstream product, and
          (2) request the Commission to cease monitoring any 
        downstream product if the information indicates that 
        imports into the United States are not increasing and 
        there is no reasonable likelihood of diversion with 
        respect to component parts.
  (d) Definitions.--For purposes of this section--
          (1) The term ``component part'' means any imported 
        article that--
                  (A) during the 5-year period ending on the 
                date on which the petition is filed under 
                subsection (a), has been subject to--
                          (i) a countervailing or antidumping 
                        duty order issued under this title or 
                        section 303 that requires the deposit 
                        of estimated countervailing or 
                        antidumping duties imposed at a rate of 
                        at least 15 percent ad valorem, or
                          (ii) an agreement entered into under 
                        section 704, 734, or 303 after a 
                        preliminary affirmative determination 
                        under section 703(b), 733(b)(1), or 303 
                        was made by the administering authority 
                        which included a determination that the 
                        estimated net countervailable subsidy 
                        was at least 15 percent ad valorem or 
                        that the estimated average amount by 
                        which the normal value exceeded the 
                        export price (or the constructed export 
                        price) was at least 15 percent ad 
                        valorem, and
                  (B) because of its inherent characteristics, 
                is routinely used as a major part, component, 
                assembly, subassembly, or material in a 
                downstream product.
          (2) The term ``downstream product'' means any 
        manufactured article--
                  (A) which is imported into the United States, 
                and
                  (B) into which is incorporated any component 
                part.

SEC. 781. PREVENTION OF CIRCUMVENTION OF ANTIDUMPING AND COUNTERVAILING 
                    DUTY ORDERS.

  (a) Merchandise Completed or Assembled in the United 
States.--
          (1) In general.--If--
                  (A) merchandise sold in the United States is 
                of the same class or kind as any other 
                merchandise that is the subject of--
                          (i) an antidumping duty order issued 
                        under section 736,
                          (ii) a finding issued under the 
                        Antidumping Act, 1921, or
                          (iii) a countervailing duty order 
                        issued under section 706 or section 
                        303,
                  (B) such merchandise sold in the United 
                States is completed or assembled in the United 
                States from parts or components produced in the 
                foreign country with respect to which such 
                order or finding applies,
                  (C) the process of assembly or completion in 
                the United States is minor or insignificant, 
                and
                  (D) the value of the parts or components 
                referred to in subparagraph (B) is a 
                significant portion of the total value of the 
                merchandise,
        the administering authority, after taking into account 
        any advice provided by the Commission under subsection 
        (e), may include within the scope of such order or 
        finding the imported parts or components referred to in 
        subparagraph (B) that are used in the completion or 
        assembly of the merchandise in the United States at any 
        time such order or finding is in effect.
          (2) Determination of whether process is minor or 
        insignificant.--In determining whether the process of 
        assembly or completion is minor or insignificant under 
        paragraph (1)(C), the administering authority shall 
        take into account--
                  (A) the level of investment in the United 
                States,
                  (B) the level of research and development in 
                the United States,
                  (C) the nature of the production process in 
                the United States,
                  (D) the extent of production facilities in 
                the United States, and
                  (E) whether the value of the processing 
                performed in the United States represents a 
                small proportion of the value of the 
                merchandise sold in the United States.
          (3) Factors to consider.--In determining whether to 
        include parts or components in a countervailing or 
        antidumping duty order or finding under paragraph (1), 
        the administering authority shall take into account 
        such factors as--
                  (A) the pattern of trade, including sourcing 
                patterns,
                  (B) whether the manufacturer or exporter of 
                the parts or components is affiliated with the 
                person who assembles or completes the 
                merchandise sold in the United States from the 
                parts or components produced in the foreign 
                country with respect to which the order or 
                finding described in paragraph (1) applies, and
                  (C) whether imports into the United States of 
                the parts or components produced in such 
                foreign country have increased after the 
                initiation of the investigation which resulted 
                in the issuance of such order or finding.
  (b) Merchandise Completed or Assembled in Other Foreign 
Countries.--
          (1) In general.--If--
                  (A) merchandise imported into the United 
                States is of the same class or kind as any 
                merchandise produced in a foreign country that 
                is the subject of--
                          (i) an antidumping duty order issued 
                        under section 736,
                          (ii) a finding issued under the 
                        Antidumping Act, 1921, or
                          (iii) a countervailing duty order 
                        issued under section 706 or section 
                        303,
                  (B) before importation into the United 
                States, such imported merchandise is completed 
                or assembled in another foreign country from 
                merchandise which--
                          (i) is subject to such order or 
                        finding, or
                          (ii) is produced in the foreign 
                        country with respect to which such 
                        order or finding applies,
                  (C) the process of assembly or completion in 
                the foreign country referred to in subparagraph 
                (B) is minor or insignificant,
                  (D) the value of the merchandise produced in 
                the foreign country to which the antidumping 
                duty order applies is a significant portion of 
                the total value of the merchandise exported to 
                the United States, and
                  (E) the administering authority determines 
                that action is appropriate under this paragraph 
                to prevent evasion of such order or finding,
        the administering authority, after taking into account 
        any advice provided by the Commission under subsection 
        (e), may include such imported merchandise within the 
        scope of such order or finding at any time such order 
        or finding is in effect.
          (2) Determination of whether process is minor or 
        insignificant.--In determining whether the process of 
        assembly or completion is minor or insignificant under 
        paragraph (1)(C), the administering authority shall 
        take into account--
                  (A) the level of investment in the foreign 
                country,
                  (B) the level of research and development in 
                the foreign country,
                  (C) the nature of the production process in 
                the foreign country,
                  (D) the extent of production facilities in 
                the foreign country, and
                  (E) whether the value of the processing 
                performed in the foreign country represents a 
                small proportion of the value of the 
                merchandise imported into the United States.
          (3) Factors to consider.--In determining whether to 
        include merchandise assembled or completed in a foreign 
        country in a countervailing duty order or an 
        antidumping duty order or finding under paragraph (1), 
        the administering authority shall take into account 
        such factors as--
                  (A) the pattern of trade, including sourcing 
                patterns,
                  (B) whether the manufacturer or exporter of 
                the merchandise described in paragraph (1)(B) 
                is affiliated with the person who uses the 
                merchandise described in paragraph (1)(B) to 
                assemble or complete in the foreign country the 
                merchandise that is subsequently imported into 
                the United States, and
                  (C) whether imports into the foreign country 
                of the merchandise described in paragraph 
                (1)(B) have increased after the initiation of 
                the investigation which resulted in the 
                issuance of such order or finding.
  (c) Minor Alterations of Merchandise.--
          (1) In general.--The class or kind of merchandise 
        subject to--
                  (A) an investigation under this title,
                  (B) an antidumping duty order issued under 
                section 736,
                  (C) a finding issued under the Antidumping 
                Act, 1921, or
                  (D) a countervailing duty order issued under 
                section 706 or section 303,
        shall include articles altered in form or appearance in 
        minor respects (including raw agricultural products 
        that have undergone minor processing), whether or not 
        included in the same tariff classification.
          (2) Exception.--Paragraph (1) shall not apply with 
        respect to altered merchandise if the administering 
        authority determines that it would be unnecessary to 
        consider the altered merchandise within the scope of 
        the investigation, order, or finding.
  (d) Later-Developed Merchandise.--
          (1) In general.--For purposes of determining whether 
        merchandise developed after an investigation is 
        initiated under this title or section 303 (hereafter in 
        this paragraph referred to as the ``later-developed 
        merchandise'') is within the scope of an outstanding 
        antidumping or countervailing duty order issued under 
        this title or section 303 as a result of such 
        investigation, the administering authority shall 
        consider whether--
                  (A) the later-developed merchandise has the 
                same general physical characteristics as the 
                merchandise with respect to which the order was 
                originally issued (hereafter in this paragraph 
                referred to as the ``earlier product''),
                  (B) the expectations of the ultimate 
                purchasers of the later-developed merchandise 
                are the same as for the earlier product,
                  (C) the ultimate use of the earlier product 
                and the later-developed merchandise are the 
                same,
                  (D) the later-developed merchandise is sold 
                through the same channels of trade as the 
                earlier product, and
                  (E) the later-developed merchandise is 
                advertised and displayed in a manner similar to 
                the earlier product.
        The administering authority shall take into account any 
        advice provided by the Commission under subsection (e) 
        before making a determination under this subparagraph.
          (2) Exclusion from orders.--The administering 
        authority may not exclude a later-developed merchandise 
        from a countervailing or antidumping duty order merely 
        because the merchandise--
                  (A) is classified under a tariff 
                classification other than that identified in 
                the petition or the administering authority's 
                prior notices during the proceeding, or
                  (B) permits the purchaser to perform 
                additional functions, unless such additional 
                functions constitute the primary use of the 
                merchandise and the cost of the additional 
                functions constitute more than a significant 
                proportion of the total cost of production of 
                the merchandise.
  (e) Commission Advice.--
          (1) Notification to commission of proposed action.--
        Before making a determination--
                  (A) under subsection (a) with respect to 
                merchandise completed or assembled in the 
                United States (other than minor completion or 
                assembly),
                  (B) under subsection (b) with respect to 
                merchandise completed or assembled in other 
                foreign countries, or
                  (C) under subsection (d) with respect to any 
                later-developed merchandise which incorporates 
                a significant technological advance or 
                significant alteration of an earlier product,
        with respect to an antidumping or countervailing duty 
        order or finding as to which the Commission has made an 
        affirmative injury determination, the administering 
        authority shall notify the Commission of the proposed 
        inclusion of such merchandise in such countervailing or 
        antidumping order or finding. Notwithstanding any other 
        provision of law, a decision by the administering 
        authority regarding whether any merchandise is within a 
        category for which notice is required under this 
        paragraph is not subject to judicial review.
          (2) Request for consultation.--After receiving notice 
        under paragraph (1), the Commission may request 
        consultations with the administering authority 
        regarding the inclusion. Upon the request of the 
        Commission, the administering authority shall consult 
        with the Commission and any such consultation shall be 
        completed within 15 days after the date of the request.
          (3) Commission advice.--If the Commission believes, 
        after consultation under paragraph (2), that a 
        significant injury issue is presented by the proposed 
        inclusion, the Commission may provide written advice to 
        the administering authority as to whether the inclusion 
        would be inconsistent with the affirmative 
        determination of the Commission on which the order or 
        finding is based. If the Commission decides to provide 
        such written advice, it shall promptly notify the 
        administering authority of its intention to do so, and 
        must provide such advice within 60 days after the date 
        of notification under paragraph (1). For purposes of 
        formulating its advice with respect to merchandise 
        completed or assembled in the United States from parts 
        or components produced in a foreign country, the 
        Commission shall consider whether the inclusion of such 
        parts or components taken as a whole would be 
        inconsistent with its prior affirmative determination.
  (f) Time Limits for Administering Authority Determinations.--
The administering authority shall, to the maximum extent 
practicable, make the determinations under this section within 
300 days from the date of the initiation of a countervailing 
duty or antidumping circumvention inquiry under this section.

SEC. 782. CONDUCT OF INVESTIGATIONS AND ADMINISTRATIVE REVIEWS.

  (a) Treatment of Voluntary Responses in Countervailing or 
Antidumping Duty Investigations and Reviews.--In any 
investigation under subtitle A or B or a review under section 
751(a) in which the administering authority has, under section 
777A(c)(2) or section 777A(e)(2)(A) (whichever is applicable), 
limited the number of exporters or producers examined, or 
determined a single country-wide rate, the administering 
authority shall establish an individual countervailable subsidy 
rate or an individual weighted average dumping margin for any 
exporter or producer not initially selected for individual 
examination under such sections who submits to the 
administering authority the information requested from 
exporters or producers selected for examination, if--
          (1) such information is so submitted by the date 
        specified--
                  (A) for exporters and producers that were 
                initially selected for examination, or
                  (B) for the foreign government, in a 
                countervailing duty case where the 
                administering authority has determined a single 
                country-wide rate; and
          (2) the number of exporters or producers who have 
        submitted such information is not so large that 
        individual examination of such exporters or producers 
        would be unduly burdensome and inhibit the timely 
        completion of the investigation.
  (b) Certification of Submissions.--Any person providing 
factual information to the administering authority or the 
Commission in connection with a proceeding under this title on 
behalf of the petitioner or any other interested party shall 
certify that such information is accurate and complete to the 
best of that person's knowledge.
  (c) Difficulties in Meeting Requirements.--
          (1) Notification by interested party.--If an 
        interested party, promptly after receiving a request 
        from the administering authority or the Commission for 
        information, notifies the administering authority or 
        the Commission (as the case may be) that such party is 
        unable to submit the information requested in the 
        requested form and manner, together with a full 
        explanation and suggested alternative forms in which 
        such party is able to submit the information, the 
        administering authority or the Commission (as the case 
        may be) shall consider the ability of the interested 
        party to submit the information in the requested form 
        and manner and may modify such requirements to the 
        extent necessary to avoid imposing an unreasonable 
        burden on that party.
          (2) Assistance to interested parties.--The 
        administering authority and the Commission shall take 
        into account any difficulties experienced by interested 
        parties, particularly small companies, in supplying 
        information requested by the administering authority or 
        the Commission in connection with investigations and 
        reviews under this title, and shall provide to such 
        interested parties any assistance that is practicable 
        in supplying such information.
  (d) Deficient Submissions.--If the administering authority or 
the Commission determines that a response to a request for 
information under this title does not comply with the request, 
the administering authority or the Commission (as the case may 
be) shall promptly inform the person submitting the response of 
the nature of the deficiency and shall, to the extent 
practicable, provide that person with an opportunity to remedy 
or explain the deficiency in light of the time limits 
established for the completion of investigations or reviews 
under this title. If that person submits further information in 
response to such deficiency and either--
          (1) the administering authority or the Commission (as 
        the case may be) finds that such response is not 
        satisfactory, or
          (2) such response is not submitted within the 
        applicable time limits,
then the administering authority or the Commission (as the case 
may be) may, subject to subsection (e), disregard all or part 
of the original and subsequent responses.
  (e) Use of Certain Information.--In reaching a determination 
under section 703, 705, 733, 735, 751, or 753 the administering 
authority and the Commission shall not decline to consider 
information that is submitted by an interested party and is 
necessary to the determination but does not meet all the 
applicable requirements established by the administering 
authority or the Commission, if--
          (1) the information is submitted by the deadline 
        established for its submission,
          (2) the information can be verified,
          (3) the information is not so incomplete that it 
        cannot serve as a reliable basis for reaching the 
        applicable determination,
          (4) the interested party has demonstrated that it 
        acted to the best of its ability in providing the 
        information and meeting the requirements established by 
        the administering authority or the Commission with 
        respect to the information, and
          (5) the information can be used without undue 
        difficulties.
  (f) Nonacceptance of Submissions.--If the administering 
authority or the Commission declines to accept into the record 
any information submitted in an investigation or review under 
this title, it shall, to the extent practicable, provide to the 
person submitting the information a written explanation of the 
reasons for not accepting the information.
  (g) Public Comment on Information.--Information that is 
submitted on a timely basis to the administering authority or 
the Commission during the course of a proceeding under this 
title shall be subject to comment by other parties to the 
proceeding within such reasonable time as the administering 
authority or the Commission shall provide. The administering 
authority and the Commission, before making a final 
determination under section 705, 735, 751, or 753 shall cease 
collecting information and shall provide the parties with a 
final opportunity to comment on the information obtained by the 
administering authority or the Commission (as the case may be) 
upon which the parties have not previously had an opportunity 
to comment. Comments containing new factual information shall 
be disregarded.
  (h) Termination of Investigation or Revocation of Order for 
Lack of Interest.--The administering authority may--
          (1) terminate an investigation under subtitle A or B 
        with respect to a domestic like product if, prior to 
        publication of an order under section 706 or 736, the 
        administering authority determines that producers 
        accounting for substantially all of the production of 
        that domestic like product have expressed a lack of 
        interest in issuance of an order; and
          (2) revoke an order issued under section 706 or 736 
        with respect to a domestic like product, or terminate 
        an investigation suspended under section 704 or 734 
        with respect to a domestic like product, if the 
        administering authority determines that producers 
        accounting for substantially all of the production of 
        that domestic like product, have expressed a lack of 
        interest in the order or suspended investigation.
  (i) Verification.--The administering authority shall verify 
all information relied upon in making--
          (1) a final determination in an investigation,
          (2) a revocation under section 751(d), and
          (3) a final determination in a review under section 
        751(a), if--
                  (A) verification is timely requested by an 
                interested party as defined in section 
                771(9)(C), (D), (E), (F), or (G), and
                  (B) no verification was made under this 
                subparagraph during the 2 immediately preceding 
                reviews and determinations under section 751(a) 
                of the same order, finding, or notice, except 
                that this clause shall not apply if good cause 
                for verification is shown.

                5. Continued Dumping and Subsidy Offset


           Section 754 of the Tariff Act of 1930, as amended


       [19 U.S.C. 1675c; P.L. 71-361, as amended by P.L. 106-387]

SEC. 754. CONTINUED DUMPING AND SUBSIDY OFFSET.

    (a) In General.--Duties assessed pursuant to a 
countervailing duty order, an antidumping duty order, or a 
finding under the Antidumping Act of 1921 shall be distributed 
on an annual basis under this section to the affected domestic 
producers for qualifying expenditures. Such distribution shall 
be known as the `continued dumping and subsidy offset'.
    (b) Definitions.--As used in this section:
          (1) Affected domestic producer.--The term ``affected 
        domestic producer'' means any manufacturer, producer, 
        farmer, rancher, or worker representative (including 
        associations of such persons) that--
                  (A) was a petitioner or interested party in 
                support of the petition with respect with 
                respect to which an antidumping duty order, a 
                finding under the Antidumping Act of 1921, or a 
                countervailing duty order has been entered, and
                  (B) remains in operation.
      Companies, businesses, or persons that have ceased the 
production of the product covered by the order or finding or 
who have been acquired by a company or business that is related 
to a company that opposed the investigation shall not be an 
affected domestic producer.
          (2) Commissioner.--The term ``Commissioner'' means 
        the Commissioner of Customs.
          (3) Commission.--The term ``Commission'' means the 
        United States International Trade Commission.
          (4) Qualifying expenditure.--The term ``qualifying 
        expenditure'' means an expenditure incurred after the 
        issuance of the antidumping duty finding or order or 
        countervailing duty order in any of the following 
        categories:
                  (A) Manufacturing facilities.
                  (B) Equipment.
                  (C) Research and development.
                  (E) Acquisition of technology.
                  (F) Health care benefits to employees paid 
                for by the employer.
                  (G) Pension benefits to employees paid for by 
                the employer.
                  (H) Environmental equipment, training, or 
                technology.
                  (I) Acquisition of raw materials and other 
                inputs.
                  (J) Working capital or other funds needed to 
                maintain production.
          (5) Related to.--A company, business, or person shall 
        be considered to be ``related to'' another company, 
        business, or person if--
                  (A)the company, business, or person, directly 
                or indirectly controls or is controlled by the 
                other company, business, or person,
                  (B) a third party directly or indirectly 
                controls both companies, businesses, or 
                persons,
                  (C) both companies, businesses, or persons 
                directly or indirectly control a third party 
                and there is reason to believe that the 
                relationship causes the first company, 
                business, or persons to act differently than a 
                nonrelated party.
      For purposes of this paragraph, a party shall be 
considered to directly or indirectly control another party if 
the party is legally or operationally in a position to exercise 
restraint or direction over the other party.
    (c) Distribution Procedures.--The Commissioner shall 
prescribe procedures for distribution of the continued dumping 
or subsidies offset required by this section. Such distribution 
shall be made not later than 60 days after the first day of the 
fiscal year from duties assessed during the preceding fiscal 
year.
    (d) Parties Eligible for Distribution of Antidumping and 
Countervailing Duties Assessed.--
          (1) List of affected domestic producers.--The 
        Commission shall forward to the Commissioner within 60 
        days after the effective date of this section in the 
        case of orders or findings in effect on January 1, 
        1999, or thereafter, or in any other case, within 60 
        days after the date an antidumping or countervailing 
        duty order or finding is issued, a list of petitioners 
        and persons with respect to each order and finding and 
        a list of persons that indicate support of the petition 
        by letter or through questionnaire response. In those 
        cases in which a determination of injury was not 
        required or the Commission's records do not permit an 
        identification of those in support of a petition, the 
        Commission shall consult with the administering 
        authority to determine the identity of the petitioner 
        and those domestic parties who have entered appearances 
        during administrative reviews conducted by the 
        administering authority under section 751.
          (2) Publication of list; certification.--The 
        Commissioner shall publish in the Federal Register at 
        least 30 days before the distribution of a continued 
        dumping and subsidy offset, a notice of intention to 
        distribute the offset and the list of affected domestic 
        producers potentially eligible for the distribution 
        based on the list obtained from the Commission under 
        paragraph (1). The Commissioner shall request a 
        certification from each potentially eligible affected 
        domestic producer--
                  (A) that the producer desires to receive a 
                distribution;
                  (B) that the producer is eligible to receive 
                the distribution as an affected domestic 
                producer; and
                  (C) the qualifying expenditures incurred by 
                the producer since the issuance of the order or 
                finding for which distribution under this 
                section has not previously been made.
          (3) Distribution of funds.--The Commissioner shall 
        distribute all funds (including all interest earned on 
        the funds) from assessed duties received in the 
        preceding fiscal year to affected domestic producers 
        based on the certifications described in paragraph (2). 
        The distributions shall be made on a pro rata basis 
        based on new and remaining qualifying expenditures.
    (e) Special Accounts.--
          (1) Establishments.--Within 14 days after the 
        effective date of this section, with respect to 
        antidumping duty orders and findings and countervailing 
        duty orders notified under subsection (d)(1), and 
        within 14 days after the date an antidumping duty order 
        or finding or countervailing duty order issued after 
        the effective date takes effect, the Commissioner shall 
        establish in the Treasury of the United States a 
        special account with respect to each such order or 
        finding.
          (2) Deposits into accounts.--The Commissioner shall 
        deposit into the special accounts, all antidumping or 
        countervailing duties (including interest earned on 
        such duties) that are assessed after the effective date 
        of this section under the antidumping order or finding 
        or the countervailing duty order with respect to which 
        the account was established.
          (3) Time and Manner of Distributions.--Consistent 
        with the requirements of subsections (c)(d), the 
        Commissioner shall be regulation prescribe the time and 
        manner in which distribution of the funds in a special 
        account shall be made.
          (4) Termination.--A special account shall terminate 
        after--
                  (A) the order or finding with respect to 
                which the account was established has 
                terminated;
                  (B) all entries relating to the order or 
                finding are liquidated and duties assessed 
                collected;
                  (C) the Commissioner has provided notice and 
                a final opportunity to obtain distribution 
                pursuant to subsection (c); and
                  (D) 90 days has elapsed from the date of the 
                notice descried in subparagraph (C).
      Amounts not claimed within 90 days of the date of the 
notice described in subparagraph (C), shall be deposited into 
the general fund of the Treasury.

  6. Judicial and Panel Review of Antidumping and Countervailing Duty 
                                Actions


           Section 516A of the Tariff Act of 1930, as amended


 [19 U.S.C. 1516A; P.L. 71-361, as amended by P.L. 96-39, P.L. 96-417, 
P.L. 96-542, P.L. 97-164, P.L. 98-573, P.L. 99-514, P.L. 100-449, P.L. 
                101-382, P.L. 103-465, and P.L. 104-295]

SEC. 516A. JUDICIAL REVIEW IN COUNTERVAILING DUTY AND ANTIDUMPING DUTY 
                    PROCEEDINGS.

    (a) Review of Determination.--
          (1) Review of certain determinations.--Within 30 days 
        after the date of publication in the Federal Register 
        of--
                  (A) a determination by the administering 
                authority, under section 702(c) or 732(c) of 
                this Act, not to initiate an investigation,
                  (B) a determination by the Commission, under 
                section 751(b) of this Act, not to review a 
                determination based upon changed circumstances,
                  (C) a negative determination by the 
                Commission, under section 703(a) or 733(a) of 
                this Act, as to whether there is reasonable 
                indication of material injury, threat of 
                material injury, or material retardation, or
                  (D) a final determination by the 
                administering authority or the Commission under 
                section 751(c)(3),
        an interested party who is a party to the proceeding in 
        connection with which the matter arises may commence an 
        action in the United States Court of International 
        Trade by filing concurrently a summons and complaint, 
        each with the content and in the form, manner, and 
        style prescribed by the rules of that court, contesting 
        any factual findings or legal conclusions upon which 
        the determination is based.
          (2) Review of determinations on record.--
                  (A) In general.--Within thirty days after--
                          (i) the date of publication in the 
                        Federal Register of--
                                  (I) notice of any 
                                determination described in 
                                clause (ii), (iii), (iv), (v), 
                                or (viii) of subparagraph (B), 
                                or
                                  (II) an antidumping or 
                                countervailing duty order based 
                                upon any determination 
                                described in clause (i) of 
                                subparagraph (B), or
                                  (III) notice of the 
                                implementation of any 
                                determination described in 
                                clause (vii) of subparagraph 
                                (B), or
                          (ii) the date of mailing of a 
                        determination described in clause (vi) 
                        of subparagraph (B),
                an interested party who is a party to the 
                proceeding in connection with which the matter 
                arises may commence an action in the United 
                States Court of International Trade by filing a 
                summons, and within thirty days thereafter a 
                complaint, each with the content and in the 
                form, manner, and style prescribed by the rules 
                of that court, contesting any factual findings 
                or legal conclusions upon which the 
                determination is based.
                  (B) Reviewable determinations.--The 
                determinations which may be contested under 
                subparagraph (A) are as follows:
                          (i) Final affirmative determinations 
                        by the administering authority and by 
                        the Commission under section 705 or 735 
                        of this Act, including any negative 
                        part of such a determination (other 
                        than a part referred to in clause 
                        (ii)).
                          (ii) A final negative determination 
                        by the administering authority or the 
                        Commission under section 705 or 735 of 
                        this Act, including, at the option of 
                        the appellant, any part of a final 
                        affirmative determination which 
                        specifically excludes any company or 
                        product.
                          (iii) A final determination, other 
                        than a determination reviewable under 
                        paragraph (1), by the administering 
                        authority or the Commission under 
                        section 751 of this Act.
                          (iv) A determination by the 
                        administering authority, under section 
                        704 or 734 of this Act, to suspend an 
                        antidumping duty or a countervailing 
                        duty investigation, including any final 
                        determination resulting from a 
                        continued investigation which changes 
                        the size of the dumping margin or net 
                        subsidy calculated, or the reasoning 
                        underlying such calculations, at the 
                        time the suspension agreement was 
                        concluded.
                          (v) An injurious effect determination 
                        by the Commission under section 704(h) 
                        or 734(h) of this Act.
                          (vi) A determination by the 
                        administering authority as to whether a 
                        particular type of merchandise is 
                        within the class or kind of merchandise 
                        described in an existing finding of 
                        dumping or antidumping or 
                        countervailing duty order.
                          (vii) A determination by the 
                        administering authority or the 
                        Commission under section 129 of the 
                        Uruguay Round Agreements Act concerning 
                        a determination under title VII of the 
                        Tariff Act of 1930.
                          (viii) A determination by the 
                        Commission under section 753(a)(1).
          (3) Exception.--Notwithstanding the limitation 
        imposed by paragraph (2)(A)(i)(II) of this subsection, 
        a final affirmative determination by the administering 
        authority under section 705 or 735 of this Act may be 
        contested by commencing an action, in accordance with 
        the provisions of paragraph (2)(A), within thirty days 
        after the date of publication in the Federal Register 
        of a final negative determination by the Commission 
        under section 705 or 735 of this Act.
          (4) Procedures and fees.--The procedures and fees set 
        forth in chapter 169 of Title 28 apply to an action 
        under this section.
          (5) Time limits in cases involving merchandise from 
        free trade area countries.--Notwithstanding any other 
        provision of this subsection, in the case of a 
        determination to which the provisions of subsection (g) 
        apply, an action under this subsection may not be 
        commenced, and the time limits for commencing an action 
        under this subsection shall not begin to run, until the 
        day specified in whichever of the following 
        subparagraphs applies:
                  (A) For a determination described in 
                paragraph (1)(B) or clause (i), (ii) or (iii) 
                of paragraph (2)(B), the 31st day after the 
                date on which notice of the determination is 
                published in the Federal Register.
                  (B) For a determination described in clause 
                (vi) of paragraph (2)(B), the 31st day after 
                the date on which the government of the 
                relevant FTA country receives notice of the 
                determination.
                  (C) For a determination with respect to which 
                binational panel review has commenced in 
                accordance with subsection (g)(8) of this 
                section, the day after the date as of which--
                          (i) the binational panel has 
                        dismissed binational panel review of 
                        the determination for lack of 
                        jurisdiction, and
                          (ii) any interested party seeking 
                        review of the determination under 
                        paragraph (1), (2), or (3) of this 
                        subsection has provided timely notice 
                        under subsection (g)(3)(B) of this 
                        section.
                If such an interested party files a summons and 
                complaint under this subsection after dismissal 
                by the binational panel, and if a request for 
                an extraordinary challenge committee is made 
                with respect to the decision by the binational 
                panel to dismiss--
                          (I) judicial review under this 
                        subsection shall be stayed during 
                        consideration by the committee of the 
                        request, and
                          (II) the United States Court of 
                        International Trade shall dismiss the 
                        action if the committee vacates or 
                        remands the binational panel decision 
                        to dismiss.
                  (D) For a determination for which review by 
                the United States Court of International Trade 
                is provided for--
                          (i) under subsection (g)(12)(B) of 
                        this section, the day after the date of 
                        publication in the Federal Register of 
                        notice that article 1904 of the NAFTA 
                        has been suspended, or
                          (ii) under subsection (g)(12)(D) of 
                        this section, the day after the date 
                        that notice of settlement is published 
                        in the Federal Register.
                  (E) For a determination described in clause 
                (vii) of paragraph (2)(B), the 31st day after 
                the date on which notice of the implementation 
                of the determination is published in the 
                Federal Register.
    (b) Standards of Review.--
          (1) Remedy.--The court shall hold unlawful any 
        determination, finding, or conclusion found--
                  (A) in an action brought under subparagraph 
                (A), (B), or (C) of subsection (a)(1) of this 
                section, to be arbitrary, capricious, an abuse 
                of discretion, or otherwise not in accordance 
                with law, or
                  (B)(i) in an action brought under paragraph 
                (2) of subsection (a) of this section, to be 
                unsupported by substantial evidence on the 
                record, or otherwise not in accordance with 
                law, or,
                  (ii) in an action brought under paragraph 
                (1)(D) of subsection (a), to be arbitrary, 
                capricious, an abuse of discretion, or 
                otherwise not in accordance with law.
          (2) Record for review.--
                  (A) In general.--For the purposes of this 
                subsection, the record, unless otherwise 
                stipulated by the parties, shall consist of--
                          (i) a copy of all information 
                        presented to or obtained by the 
                        Secretary, the administering authority, 
                        or the Commission during the course of 
                        the administrative proceeding, 
                        including all governmental memoranda 
                        pertaining to the case and the record 
                        of ex parte meetings required to be 
                        kept by section 777(a)(3) of this 
                        title; and
                          (ii) a copy of the determination, all 
                        transcripts or records of conferences 
                        or hearings, and all notices published 
                        in the Federal Register.
                  (B) Confidential or privileged material.--The 
                confidential or privileged status accorded to 
                any documents, comments, or information shall 
                be preserved in any action under this section. 
                Notwithstanding the preceding sentence, the 
                court may examine, in camera, the confidential 
                or privileged material, and may disclose such 
                material under such terms and conditions as it 
                may order.
          (3) Effect of decisions by nafta or united states-
        canada binational panels.--In making a decision in any 
        action brought under subsection (a) of this section, a 
        court of the United States is not bound by, but may 
        take into consideration, a final decision of a 
        binational panel or extraordinary challenge committee 
        convened pursuant to article 1904 of the NAFTA or of 
        the Agreement.
    (c) Liquidation of Entries.--
          (1) Liquidation in accordance with determination.--
        Unless such liquidation is enjoined by the court under 
        paragraph (2) of this subsection, entries of 
        merchandise of the character covered by a determination 
        of the Secretary, the administering authority, or the 
        Commission contested under subsection (a) of this 
        section shall be liquidated in accordance with the 
        determination of the Secretary, the administering 
        authority, or the Commission, if they are entered, or 
        withdrawn from warehouse, for consumption on or before 
        the date of publication in the Federal Register by the 
        Secretary or the administering authority of a decision 
        of the United States Court of International Trade, or 
        of the United States Court of Appeals for the Federal 
        Circuit, not in harmony with that determination. Such 
        notice of a decision shall be published within ten days 
        from the date of the issuance of the court decision.
          (2) Injunctive relief.--In the case of a 
        determination described in paragraph (2) of subsection 
        (a) of this section by the Secretary, the administering 
        authority, or the Commission, the United States Court 
        of International Trade may enjoin the liquidation of 
        some or all entries of merchandise covered by a 
        determination of the Secretary, the administering 
        authority, or the Commission, upon a request by an 
        interested party for such relief and a proper showing 
        that the requested relief should be granted under the 
        circumstances.
          (3) Remand for final disposition.--If the final 
        decision of an action brought under this section is not 
        in harmony with the published determination of the 
        Secretary, the administering authority, or the 
        Commission, the matter shall be remanded to the 
        Secretary, the administering authority, or the 
        Commission, as appropriate, for disposition consistent 
        with the final disposition of the court.
    (d) Standing.--Any interested party who was a party to the 
proceeding under section 303 of this Act or title VII of this 
Act shall have the right to appear and be heard as a party in 
interest before the United States Court of International Trade. 
The party filing the action shall notify all such interested 
parties of the filing of an action under this section, in the 
form, manner, and within the time prescribed by rules of the 
court.
    (e) Liquidation in Accordance With Final Decision.--If the 
cause of action is sustained in whole or in part by a decision 
of the United States Court of International Trade or of the 
United States Court of Appeals for the Federal Circuit--
          (1) entries of merchandise of the character covered 
        by the published determination of the Secretary, the 
        administering authority, or the Commission, which is 
        entered, or withdrawn from warehouse, for consumption 
        after the date of publication in the Federal Register 
        by the Secretary or the administering authority of a 
        notice of the court decision, and
          (2) entries the liquidation of which was enjoined 
        under subsection (c)(2) of this section,
shall be liquidated in accordance with the final court decision 
in the action. Such notice of the court decision shall be 
published within ten days from the date of the issuance of the 
court decision.
    (f) Definitions.--For the purpose of this section--
          (1) Administering authority.--The term 
        ``administering authority'' means the administering 
        authority described in section 771(1) of this Act.
          (2) Commission.--The term ``Commission'' means the 
        United States International Trade Commission.
          (3) Interested party.--The term ``interested party'' 
        means any person described in section 771(9) of this 
        Act.
          (4) Secretary.--The term ``Secretary'' means the 
        Secretary of the Treasury.
          (5) Agreement.--The term ``Agreement'' means the 
        United States-Canada Free-Trade Agreement.
          (6) United states secretary.--The term ``United 
        States Secretary'' means--
                  (A) the secretary for the United States 
                Section referred to in article 1908 of the 
                NAFTA, and
                  (B) the secretary of the United States 
                Section provided for in article 1909 of the 
                Agreement.
          (7) Relevant fta secretary.--The term ``relevant FTA 
        Secretary'' means the Secretary--
                  (A) referred to in article 1908 of the NAFTA, 
                or
                  (B) provided for in paragraph 5 of article 
                1909 of the Agreement, of the relevant FTA 
                country.
          (8) NAFTA.--The term ``NAFTA'' means the North 
        American Free Trade Agreement.
          (9) Relevant fta country.--The term ``relevant FTA 
        country'' means the free trade area country to which an 
        antidumping or countervailing duty proceeding pertains.
          (10) Free trade area country.--The term ``free trade 
        area country'' means the following:
                  (A) Canada for such time as the NAFTA is in 
                force with respect to, and the United States 
                applies the NAFTA to, Canada.
                  (B) Mexico for such time as the NAFTA is in 
                force with respect to, and the United States 
                applies the NAFTA to, Mexico.
                  (C) Canada for such time as--
                          (i) it is not a free trade area 
                        country under subparagraph (A); and
                          (ii) the Agreement is in force with 
                        respect to, and the United States 
                        applies the Agreement to, Canada.
    (g) Review of Countervailing Duty and Antidumping Duty 
Determinations Involving Free Trade Area Country Merchandise.--
          (1) Definition of determination.--For purposes of 
        this subsection, the term ``determination'' means a 
        determination described in--
                  (A) paragraph (1)(B) of subsection (a), or
                  (B) clause (i), (ii), (iii), or (vi) of 
                paragraph (2)(B) of subsection (a) of this 
                section,
        if made in connection with a proceeding regarding a 
        class or kind of free trade area country merchandise, 
        as determined by the administering authority.
          (2) Exclusive review of determination by binational 
        panels.--If binational panel review of a determination 
        is requested pursuant to Article 1904 of the NAFTA or 
        of the Agreement, then, except as provided in paragraph 
        (3) and (4)--
                  (A) the determination is not reviewable under 
                subsection (a), and
                  (B) no court of the United States has power 
                or jurisdiction to review the determination on 
                any question of law or fact by an action in the 
                nature of mandamus or otherwise.
          (3) Exception to exclusive binational panel review.--
                  (A) In general.--A determination is 
                reviewable under subsection (a) of this section 
                if the determination sought to be reviewed is--
                          (i) a determination as to which 
                        neither the United States nor the 
                        relevant FTA country requested review 
                        by a binational panel pursuant to 
                        article 1904 of the NAFTA or of the 
                        Agreement,
                          (ii) a revised determination issued 
                        as a direct result of judicial review, 
                        commenced pursuant to subsection (a), 
                        if neither the United States nor the 
                        relevant FTA country requested review 
                        of the original determination,
                          (iii) a determination issued as a 
                        direct result of judicial review that 
                        was commenced pursuant to subsection 
                        (a) of this section prior to the entry 
                        into force of the NAFTA or of the 
                        Agreement,
                          (iv) a determination which a 
                        binational panel has determined is not 
                        reviewable by the binational panel,
                          (v) a determination as to which 
                        binational panel review has terminated 
                        pursuant to paragraph 12 of article 
                        1905 of the NAFTA, or
                          (vi) a determination as to which 
                        extraordinary challenge committee 
                        review has terminated pursuant to 
                        paragraph 12 of article 1905 of the 
                        NAFTA.
                  (B) Special rule.--A determination described 
                in subparagraph (A)(i) or (iv) is reviewable 
                under subsection (a) of this section only if 
                the party seeking to commence review has 
                provided timely notice of its intent to 
                commence such review to--
                          (i) the United States Secretary, the 
                        relevant FTA Secretary;
                          (ii) all interested parties who were 
                        parties to the proceeding in connection 
                        with which the matter arises; and
                          (iii) the administering authority or 
                        the Commission, as appropriate.
                Such notice is provided timely if the notice is 
                delivered by no later than the date that is 20 
                days after the date described in subparagraph 
                (A) or (B) of subsection (a)(5) of this section 
                that is applicable to such determination, 
                except that, if the time for requesting 
                binational panel review is suspended under 
                paragraph (8)(A)(ii) of this subsection, any 
                unexpired time for providing notice of intent 
                to commence judicial review shall, during the 
                pendency of any such suspension, also be 
                suspended. Such notice shall contain such 
                information, and be in such form, manner, and 
                style, as the administering authority, in 
                consultation with the Commission, shall 
                prescribe by regulations.
          (4) Exception to exclusive binational panel review 
        for constitutional issues.--
                  (A) Constitutionality of binational panel 
                review system.--An action for declaratory 
                judgment or injunctive relief, or both, 
                regarding a determination on the grounds that 
                any provision of, or amendment made by, the 
                North American Free Trade Agreement 
                Implementation Act implementing the binational 
                dispute settlement system under chapter 19 of 
                the NAFTA, the United States-Canada Free-Trade 
                Agreement Implementation Act of 1988 
                implementing the binational panel dispute 
                settlement system under Chapter 19 of the 
                Agreement, violates the Constitution may be 
                brought only in the United States Court of 
                Appeals for the District of Columbia Circuit, 
                which shall have jurisdiction of such action.
                  (B) Other constitutional review.--Review is 
                available under subsection (a) with respect to 
                a determination solely concerning a 
                constitutional issue (other than an issue to 
                which subparagraph (A) applies) arising under 
                any law of the United States as enacted or 
                applied. An action for review under this 
                subparagraph shall be assigned to a 3-judge 
                panel of the United States Court of 
                International Trade.
                  (C) Commencement of review.--Notwithstanding 
                the time limits in subsection (a), within 30 
                days after the date of publication in the 
                Federal Register of notice that binational 
                panel review has been completed, an interested 
                party who is a party to the proceeding in 
                connection with which the matter arises may 
                commence an action under subparagraph (A) or 
                (B) by filing an action in accordance with the 
                rules of the court.
                  (D) Transfer of actions to appropriate 
                court.--Whenever an action is filed in a court 
                under subparagraph (A) or (B) and that court 
                finds that the action should have been filed in 
                the other court, the court in which the action 
                was filed shall transfer the action to the 
                other court and the action shall proceed as if 
                it had been filed in the court to which it is 
                transferred on the date upon which it was 
                actually filed in the court from which it is 
                transferred.
                  (E) Frivolous claims.--Frivolous claims 
                brought under subparagraph (A) or (B) are 
                subject to dismissal and sanctions as provided 
                under section 1927 of title 28, United States 
                Code, and the Federal Rules of Civil Procedure.
                  (F) Security.--
                          (i) Subparagraph (a) actions.--The 
                        security requirements of Rule 65(c) of 
                        the Federal Rules of Civil Procedure 
                        apply with respect to actions commenced 
                        under subparagraph (A).
                          (ii) Subparagraph (b) actions.--No 
                        claim shall be heard, and no temporary 
                        restraining order or temporary or 
                        permanent injunction shall be issued, 
                        under an action commenced under 
                        subparagraph (B), unless the party 
                        seeking review first files an 
                        undertaking with adequate security in 
                        an amount to be fixed by the court 
                        sufficient to recompense parties 
                        affected for any loss, expense, or 
                        damage caused by the improvident or 
                        erroneous issuance of such order or 
                        injunction. If a court upholds the 
                        constitutionality of the determination 
                        in question in such action, the court 
                        shall award to a prevailing party fees 
                        and expenses, in addition to any costs 
                        incurred by that party, unless the 
                        court finds that the position of the 
                        other party was substantially justified 
                        or that special circumstances make an 
                        award unjust.
                  (G) Panel record.--The record of proceedings 
                before the binational panel shall not be 
                considered part of the record for review 
                pursuant to subparagraph (A) or (B).
                  (H) Appeal to supreme court of court orders 
                issued in subparagraph (a) actions.--
                Notwithstanding any other provision of law, any 
                final judgment of the United States Court of 
                Appeals for the District of Columbia Circuit 
                which is issued pursuant to an action brought 
                under subparagraph (A) shall be reviewable by 
                appeal directly to the Supreme Court of the 
                United States. Any such appeal shall be taken 
                by a notice of appeal filed within 10 days 
                after such order is entered; and the 
                jurisdictional statement shall be filed within 
                30 days after such order is entered. No stay of 
                an order issued pursuant to an action brought 
                under subparagraph (A) may be issued by a 
                single Justice of the Supreme Court.
          (5) Liquidation of entries.--
                  (A) Application.--In the case of a 
                determination for which binational panel review 
                is requested pursuant to article 1904 of the 
                NAFTA or of the Agreement, the rules provided 
                in this paragraph shall apply, notwithstanding 
                the provisions of subsection (c).
                  (B) General rule.--In the case of a 
                determination for which binational panel review 
                is requested pursuant to article 1904 of the 
                NAFTA or of the Agreement, entries of 
                merchandise covered by such determination shall 
                be liquidated in accordance with the 
                determination of the administering authority or 
                the Commission, if they are entered, or 
                withdrawn from warehouse, for consumption on or 
                before the date of publication in the Federal 
                Register by the administering authority of 
                notice of a final decision of a binational 
                panel, or of an extraordinary challenge 
                committee, not in harmony with that 
                determination. Such notice of a decision shall 
                be published within 10 days of the date of the 
                issuance of the panel or committee decision.
                  (C) Suspension of liquidation.--
                          (i) In general.--Notwithstanding the 
                        provisions of subparagraph (B), in the 
                        case of a determination described in 
                        clause (iii) or (vi) of subsection 
                        (a)(2)(B) for which binational panel 
                        review is requested pursuant to article 
                        1904 of the NAFTA or of the Agreement, 
                        the administering authority, upon 
                        request of an interested party who was 
                        a party to the proceeding in connection 
                        with which the matter arises and who is 
                        a participant in the binational panel 
                        review, shall order the continued 
                        suspension of liquidation of those 
                        entries of merchandise covered by the 
                        determination that are involved in the 
                        review pending the final disposition of 
                        the review.
                          (ii) Notice.--At the same time as the 
                        interested party makes its request to 
                        the administering authority under 
                        clause (i), that party shall serve a 
                        copy of its request on the United 
                        States Secretary, the relevant FTA 
                        Secretary, and all interested parties 
                        who were parties to the proceeding in 
                        connection with which the matter 
                        arises.
                          (iii) Application of suspension.--If 
                        the interested party requesting 
                        continued suspension of liquidation 
                        under clause (i) is a foreign 
                        manufacturer, producer, or exporter, or 
                        a United States importer, the continued 
                        suspension of liquidation shall apply 
                        only to entries of merchandise 
                        manufactured, produced, exported, or 
                        imported by that particular 
                        manufacturer, producer, exporter, or 
                        importer. If the interested party 
                        requesting the continued suspension of 
                        liquidation under clause (i) is an 
                        interested party described in 
                        subparagraph (C), (D), (E), or (F) of 
                        section 771(9), the continued 
                        suspension of liquidation shall apply 
                        only to entries which could be affected 
                        by a decision of the binational panel 
                        convened under chapter 19 of the NAFTA 
                        or of the Agreement.
                          (iv) Judicial review.--Any action 
                        taken by the administering authority or 
                        the United States Customs Service under 
                        this subparagraph shall not be subject 
                        to judicial review, and no court of the 
                        United States shall have power or 
                        jurisdiction to review such action on 
                        any question of law or fact by an 
                        action in the nature of mandamus or 
                        otherwise.
          (6) Injunctive relief.--Except for cases under 
        paragraph (4)(B), in the case of a determination for 
        which binational level review is requested pursuant to 
        article 1904 of the NAFTA or of the Agreement, the 
        provisions of subsection (c)(2) shall not apply.
          (7) Implementation of international obligations under 
        article 1904 of the nafta or the agreement.--
                  (A) In general.--If a determination is 
                referred to a binational panel or extraordinary 
                challenge committee under the NAFTA or the 
                Agreement and the panel or committee makes a 
                decision remanding the determination to the 
                administering authority or the Commission, the 
                administering authority or the Commission 
                shall, within the period specified by the panel 
                or committee, take action not inconsistent with 
                the decision of the panel or committee. Any 
                action taken by the administering authority or 
                the Commission under this paragraph shall not 
                be subject to judicial review, and no court of 
                the United States shall have power or 
                jurisdiction to review such action on any 
                question of law or fact by an action in the 
                nature of mandamus or otherwise.
                  (B) Application if subparagraph (a) held 
                unconstitutional.--In the event that the 
                provisions of subparagraph (A) are held 
                unconstitutional under the provisions of 
                subparagraphs (A) and (H) of paragraph (4), the 
                provisions of this subparagraph shall take 
                effect. In such event, the President is 
                authorized on behalf of the United States to 
                accept, as a whole, the decision of a 
                binational panel or extraordinary challenge 
                committee remanding the determination to the 
                administering authority or the Commission 
                within the period specified by the panel or 
                committee. Upon acceptance by the President of 
                such a decision, the administering authority or 
                the Commission shall, within the period 
                specified by the panel or committee, take 
                action not inconsistent with such decision. Any 
                action taken by the President, the 
                administering authority, or the Commission 
                under this subparagraph shall not be subject to 
                judical review, and no court of the United 
                States shall have power or jurisdiction to 
                review such action on any question of law or 
                fact by an action in the nature of mandamus or 
                otherwise.
          (8) Requests for binational panel review.--
                  (A) Interested party requests for binational 
                panel review.--
                          (i) General rule.--An interested 
                        party who was a party to the proceeding 
                        in which a determination is made may 
                        request binational panel review of such 
                        determination by filing a request with 
                        the United States Secretary by no later 
                        than the date that is 30 days after the 
                        date described in subparagraph (A), 
                        (B), or (E) of subsection (a)(5) of 
                        this section that is applicable to such 
                        determination. Receipt of such request 
                        by the United States Secretary shall be 
                        deemed to be a request for binational 
                        panel review within the meaning of 
                        article 1904(4) of the NAFTA or of the 
                        Agreement. Such request shall contain 
                        such information and be in such form, 
                        manner, and style as the administering 
                        authority, in consultation with the 
                        Commission, shall prescribe by 
                        regulations.
                          (ii) Suspension of time to request 
                        binational panel review under the 
                        nafta.--Notwithstanding clause (i), the 
                        time for requesting binational panel 
                        review shall be suspended during the 
                        pendency of any stay of binational 
                        panel review that is issued pursuant to 
                        paragraph 11(a) of article 1905 of the 
                        NAFTA.
                  (B) Service of request for binational panel 
                review.--
                          (i) Service by interested party.--If 
                        a request for binational panel review 
                        of a determination is filed under 
                        subparagraph (A), the party making the 
                        request shall serve a copy, by mail or 
                        personal service, on any other 
                        interested party who was a party to the 
                        proceeding in connection with which the 
                        matter arises, and on the administering 
                        authority or the Commission, as 
                        appropriate.
                          (ii) Service by united states 
                        secretary.--If an interested party to 
                        the proceeding requests binational 
                        panel review of a determination by 
                        filing a request with the relevant FTA 
                        Secretary, the United States Secretary 
                        shall serve a copy of the request by 
                        mail on any other interested party who 
                        was a party to the proceeding in 
                        connection with which the matter 
                        arises, and on the administering 
                        authority or the Commission, as 
                        appropriate.
                  (C) Limitation on request for binational 
                panel review.--Absent a request by an 
                interested party under subparagraph (A), the 
                United States may not request binational panel 
                review under article 1904 of the NAFTA or the 
                Agreement of a determination.
          (9) Representation in panel proceedings.--In the case 
        of binational panel proceedings convened under chapter 
        19 of the NAFTA or of the Agreement, the administering 
        authority and the Commission shall be represented by 
        attorneys who are employees of the administering 
        authority or the Commission respectively. Interested 
        parties who were parties to the proceeding in 
        connection with which the matter arises shall have the 
        right to appear and be represented by counsel before 
        the binational panel.
          (10) Notification of class or kind rulings.--In the 
        case of a determination which is described in paragraph 
        (2)(B)(vi) of subsection (a) and which is subject to 
        the provisions of paragraph (2), the administering 
        authority, upon request, shall inform any interested 
        person of the date on which the Government of the 
        relevant FTA country received notice of the 
        determination under article 1904(4) of the NAFTA or the 
        Agreement.
          (11) Suspension and termination of suspension of 
        article 1904 of the nafta.--
                  (A) Suspension of article 1904.--If a special 
                committee established under article 1905 of the 
                NAFTA issues an affirmative finding, the Trade 
                Representative may, in accordance with 
                paragraph 8(a) or 9, as appropriate, of article 
                1905 of the NAFTA, suspend the operation of 
                article 1904 of the NAFTA.
                  (B) Termination of suspension of article 
                1904.--If a special committee is reconvened and 
                makes an affirmative determination described in 
                paragraph 10(b) of article 1905 of the NAFTA, 
                any suspension of the operation of article 1904 
                of the NAFTA shall terminate.
          (12) Judicial review upon termination of binational 
        panel or committee review under the nafta.--
                  (A) Notice of suspension or termination of 
                suspension of article 1904.--
                          (i) Upon notification by the Trade 
                        Representative or the Government of a 
                        country described in subsection 
                        (f)(10)(A) or (B) of this section that 
                        the operation of article 1904 of the 
                        NAFTA has been suspended in accordance 
                        with paragraph 8(a) or 9 of article 
                        1905 of the NAFTA, the United States 
                        Secretary shall publish in the Federal 
                        Register a notice of suspension of 
                        article 1904 of the NAFTA.
                          (ii) Upon notification by the Trade 
                        Representative or the Government of a 
                        country described in subsection 
                        (f)(10)(A) or (B) of this section that 
                        the suspension of the operation of 
                        article 1904 of the NAFTA is terminated 
                        in accordance with paragraph 10 of 
                        article 1905 of the NAFTA, the United 
                        States Secretary shall publish in the 
                        Federal Register a notice of 
                        termination of suspension of article 
                        1904 of the NAFTA.
                  (B) Transfer of final determinations for 
                judicial review upon suspension of article 
                1904.--If the operation of article 1904 of the 
                NAFTA is suspended in accordance with paragraph 
                8(a) or 9 of article 1905 of the NAFTA--
                          (i) upon the request of an authorized 
                        person described in subparagraph (C), 
                        any final determination that is the 
                        subject of a binational panel review or 
                        an extraordinary challenge committee 
                        review shall be transferred to the 
                        United States Court of International 
                        Trade (in accordance with rules issued 
                        by the Court) for review under 
                        subsection (a) of this section; or
                          (ii) in a case in which--
                                  (I) a binational panel review 
                                was completed fewer than 30 
                                days before the suspension, and
                                  (II) extraordinary challenge 
                                committee review has not been 
                                requested,
                        upon the request of an authorized 
                        person described in subparagraph (C) 
                        which is made within 60 days after the 
                        completion of the binational panel 
                        review, the final determination that 
                        was the subject of the binational panel 
                        review shall be transferred to the 
                        United States Court of International 
                        Trade (in accordance with rules issued 
                        by the Court) for review under 
                        subsection (a) of this section.
                  (C) Persons authorized to request transfer of 
                final determinations for judicial review.--A 
                request that a final determination be 
                transferred to the Court of International Trade 
                under subparagraph (B) may be made by--
                          (i) if the United States made an 
                        allegation under paragraph 1 of article 
                        1905 of the NAFTA and the operation of 
                        article 1904 of the NAFTA was suspended 
                        pursuant to paragraph 8(a) of article 
                        1905 of the NAFTA--
                                  (I) the government of the 
                                relevant country described in 
                                subsection (f)(10)(A) or (B) of 
                                this section,
                                  (II) an interested party that 
                                was a party to the panel or 
                                committee review, or
                                  (III) an interested party 
                                that was a party to the 
                                proceeding in connection with 
                                which panel review was 
                                requested, but only if the time 
                                period for filing notices of 
                                appearance in the panel review 
                                has not expired, or
                          (ii) if a country described in 
                        subsection (f)(10)(A) or (B) of this 
                        section made an allegation under 
                        paragraph 1 of article 1905 of the 
                        NAFTA and the operation of article 1904 
                        of the NAFTA was suspended pursuant to 
                        paragraph 9 of article 1905 of the 
                        NAFTA--
                                  (I) the government of that 
                                country,
                                  (II) an interested party that 
                                is a person of that country and 
                                that was a party to the panel 
                                or committee review, or
                                  (III) an interested party 
                                that is a person of that 
                                country and that was a party to 
                                the proceeding in connection 
                                with which panel review was 
                                requested, but only if the time 
                                period for filing notices of 
                                appearance in the panel review 
                                has not expired.
                  (D) Transfer for judicial review upon 
                settlement.--(i) If the Trade Representative 
                achieves a settlement with the government of a 
                country described in subsection (f)(10)(A) or 
                (B) of this section pursuant to paragraph 7 of 
                article 1905 of the NAFTA, and referral for 
                judicial review is among the terms of such 
                settlement, any final determination that is the 
                subject of a binational panel review or an 
                extraordinary challenge committee review shall, 
                upon a request described in clause (ii), be 
                transferred to the United States Court of 
                International Trade (in accordance with rules 
                issued by the Court) for review under 
                subsection (a) of this section.
                  (ii) A request referred to in clause (i) is a 
                request made by--
                          (I) the country referred to in clause 
                        (i),
                          (II) an interested party that was a 
                        party to the panel or committee review, 
                        or
                          (III) an interested party that was a 
                        party to the proceeding in connection 
                        with which panel review was requested, 
                        but only if the time for filing notices 
                        of appearance in the panel review has 
                        not expired.

            Section 129 of the Uruguay Round Agreements Act


                     [19 U.S.C. 3538; P.L. 103-465]

SEC. 129. ADMINISTRATIVE ACTION FOLLOWING WTO PANEL REPORTS.

    (a) Action by United States International Trade 
Commission.--
          (1) Advisory report.--If a dispute settlement panel 
        finds in an interim report under Article 15 of the 
        Dispute Settlement Understanding, or the Appellate Body 
        finds in a report under Article 17 of that 
        Understanding, that an action by the International 
        Trade Commission in connection with a particular 
        proceeding is not in conformity with the obligations of 
        the United States under the Antidumping Agreement, the 
        Safeguards Agreement, or the Agreement on Subsidies and 
        Countervailing Measures, the Trade Representative may 
        request the Commission to issue an advisory report on 
        whether title VII of the Tariff Act of 1930 or title II 
        of the Trade Act of 1974, as the case may be, permits 
        the Commission to take steps in connection with the 
        particular proceeding that would render its action not 
        inconsistent with the findings of the panel or the 
        Appellate Body concerning those obligations. The Trade 
        Representative shall notify the congressional 
        committees of such request.
          (2) Time limits for report.--The Commission shall 
        transmit its report under paragraph (1) to the Trade 
        Representative--
                  (A) in the case of an interim report 
                described in paragraph (1), within 30 calendar 
                days after the Trade Representative requests 
                the report; and
                  (B) in the case of a report of the Appellate 
                Body, within 21 calendar days after the Trade 
                Representative requests the report.
          (3) Consultations on request for commission 
        determination.--If a majority of the Commissioners 
        issues an affirmative report under paragraph (1), the 
        Trade Representative shall consult with the 
        congressional committees concerning the matter.
          (4) Commission determination.--Notwithstanding any 
        provision of the Tariff Act of 1930 or title II of the 
        Trade Act of 1974, if a majority of the Commissioners 
        issues an affirmative report under paragraph (1), the 
        Commission, upon the written request of the Trade 
        Representative, shall issue a determination in 
        connection with the particular proceeding that would 
        render the Commission's action described in paragraph 
        (1) not inconsistent with the findings of the panel or 
        Appellate Body. The Commission shall issue its 
        determination not later than 120 days after the request 
        from the Trade Representative is made.
          (5) Consultations on implementation of commission 
        determination.--The Trade Representative shall consult 
        with the congressional committees before the 
        Commission's determination under paragraph (4) is 
        implemented.
          (6) Revocation of order.--If, by virtue of the 
        Commission's determination under paragraph (4), an 
        antidumping or countervailing duty order with respect 
        to some or all of the imports that are subject to the 
        action of the Commission described in paragraph (1) is 
        no longer supported by an affirmative Commission 
        determination under title VII of the Tariff Act of 1930 
        or this subsection, the Trade Representative may, after 
        consulting with the congressional committees under 
        paragraph (5), direct the administering authority to 
        revoke the antidumping or countervailing duty order in 
        whole or in part.
          (7) Modification of action under title ii of trade 
        act of 1974.--Section 204(b) of the Trade Act of 1974 
        (19 U.S.C. 2254(b)) is amended by adding at the end the 
        following new paragraph:
          ``(3) Notwithstanding paragraph (1), the President 
        may, after receipt of a Commission determination under 
        section 129(a)(4) of the Uruguay Round Agreements Act 
        and consulting with the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate, reduce, modify, or terminate 
        action taken under section 203.''.
    (b) Action by Administering Authority.--
          (1) Consultations with administering authority and 
        congressional committees.--Promptly after a report by a 
        dispute settlement panel or the Appellate body is 
        issued that contains findings that an action by the 
        administering authority in a proceeding under title VII 
        of the Tariff Act of 1930 is not in conformity with the 
        obligations of the United States under the Antidumping 
        Agreement or the Agreement on Subsidies and 
        Countervailing Measures, the Trade Representative shall 
        consult with the administering authority and the 
        congressional committees on the matter.
          (2) Determination by administering authority.--
        Notwithstanding any provision of the Tariff Act of 
        1930, the administering authority shall, within 180 
        days after receipt of a written request from the Trade 
        Representative, issue a determination in connection 
        with the particular proceeding that would render the 
        administering authority's action described in paragraph 
        (1) not inconsistent with the findings of the panel or 
        the Appellate Body.
          (3) Consultations before implementation.--Before the 
        administering authority implements any determination 
        under paragraph (2), the Trade Representative shall 
        consult with the administering authority and the 
        congressional committees with respect to such 
        determination.
          (4) Implementation of determination.--The Trade 
        Representative may, after consulting with the 
        administering authority and the congressional 
        committees under paragraph (3), direct the 
        administering authority to implement, in whole or in 
        part, the determination made under paragraph (2).
    (c) Effects of Determinations; Notice of Implementation.--
          (1) Effects of determinations.--Determinations 
        concerning title VII of the Tariff Act of 1930 that are 
        implemented under this section shall apply with respect 
        to unliquidated entries of the subject merchandise (as 
        defined in section 771 of that Act) that are entered, 
        or withdrawn from warehouse, for consumption on or 
        after--
                  (A) in the case of a determination by the 
                Commission under subsection (a)(4), the date on 
                which the Trade Representative directs the 
                administering authority under subsection (a)(6) 
                to revoke an order pursuant to that 
                determination, and
                  (B) in the case of a determination by the 
                administering authority under subsection 
                (b)(2), the date on which the Trade 
                Representative directs the administering 
                authority under subsection (b)(4) to implement 
                that determination.
          (2) Notice of implementation.--
                  (A) The administering authority shall publish 
                in the Federal Register notice of the 
                implementation of any determination made under 
                this section with respect to title VII of the 
                Tariff Act of 1930.
                  (B) The Trade Representative shall publish in 
                the Federal Register notice of the 
                implementation of any determination made under 
                this section with respect to title II of the 
                Trade Act of 1974.
    (d) Opportunity for Comment by Interested Parties.--Prior 
to issuing a determination under this section, the 
administering authority or the Commission, as the case may be, 
shall provide interested parties with an opportunity to submit 
written comments and, in appropriate cases, may hold a hearing, 
with respect to the determination.

                        7. Third-Country Dumping


   Section 1317 of the Omnibus Trade and Competitiveness Act of 1988


            [19 U.S.C. 1677k; P.L. 100-418 and P.L. 103-465]

SEC. 1317. THIRD-COUNTRY DUMPING.

    (a) Definitions.--For purposes of this section:
          (1)(A) The term ``Agreement'' means the agreement on 
        Implementation of Article VI of the GATT 1994 (relating 
        to antidumping measures).
          (B) The term ``GATT 1994'' has the meaning given that 
        term in section 2(1)(B) of the Uruguay Round Agreements 
        Act.
          (2) The term ``Agreement country'' means a foreign 
        country that has accepted the Agreement.
          (3) The term ``Trade Representative'' means the 
        United States Trade Representative.
    (b) Petition by Domestic Industry.--
          (1) A domestic industry that produces a product that 
        is like or directly competitive with merchandise 
        produced by a foreign country (whether or not an 
        Agreement country) may, if it has reason to believe 
        that--
                  (A) such merchandise is being dumped in an 
                Agreement country; and
                  (B) such domestic industry is being 
                materially injured, or threatened with material 
                injury, by reason of such dumping;
        submit a petition to the Trade Representative that 
        alleges the elements referred to in subparagraphs (A) 
        and (B) and requests the Trade Representative to take 
        action under subsection (c) on behalf of the domestic 
        industry.
          (2) A petition submitted under paragraph (1) shall 
        contain such detailed information as the Trade 
        Representative may require in support of the 
        allegations in the petition.
    (c) Application for Antidumping Action on Behalf of the 
Domestic Industry.--
          (1) If the Trade representative, on the basis of the 
        information contained in a petition submitted under 
        paragraph (1), determines that there is a reasonable 
        basis for the allegations in the petition, the Trade 
        Representative shall submit to the appropriate 
        authority of the Agreement country where the alleged 
        dumping is occurring an application pursuant to article 
        12 of the Agreement which requests that appropriate 
        antidumping action under the law of that country be 
        taken, on behalf of the United States, with respect to 
        imports into that country of the merchandise concerned.
          (2) At the request of the Trade Representative, the 
        appropriate officers of the Department of Commerce and 
        the United States International Trade Commission shall 
        assist the Trade Representative in preparing the 
        application under paragraph (1).
    (d) Consultation After Submission of Application.--After 
submitting an application under subsection (c)(1), the Trade 
Representative shall seek consultations with the appropriate 
authority of the Agreement country regarding the request for 
antidumping action.
    (e) Action Upon Refusal of Agreement Country to Act.--if 
the appropriate authority of an Agreement country refuses to 
undertake antidumping measures in response to a request made 
therefore by the Trade Representative under subsection (c), the 
Trade Representative shall promptly consult with the domestic 
industry on whether action under any other law of the United 
States is appropriate.

              8. Antidumping Petitions by Third Countries


           Section 783 of the Tariff Act of 1930, as amended


      [19 U.S.C. 1677n; P.L. 103-465, as amended by P.L. 104-295]

SEC. 783. ANTIDUMPING PETITIONS BY THIRD COUNTRIES.

  (a) Filing of Petition.--The government of a WTO member may 
file with the Trade Representative a petition requesting that 
an investigation be conducted to determine if--
          (1) imports from another country are being sold in 
        the United States at less than fair value, and
          (2) an industry in the petitioning country is 
        materially injured by reason of those imports.
  (b) Initiation.--The Trade Representative, after consultation 
with the administering authority and the Commission and 
obtaining the approval of the WTO Council for Trade in Goods, 
shall determine whether to initiate an investigation described 
in subsection (a).
  (c) Determinations.--Upon initiation of an investigation 
under this section, the Trade Representative shall request the 
following determinations be made according to substantive and 
pro
cedural requirements specified by the Trade Representative, 
notwithstanding any other provision of this title:
          (1) The administering authority shall determine 
        whether imports into the United States of the subject 
        merchandise are being sold at less than fair value.
          (2) The Commission shall determine whether an 
        industry in the petitioning country is materially 
        injured by reason of imports of the subject merchandise 
        into the United States.
  (d) Public Comment.--An opportunity for public comment shall 
be provided, as appropriate--
          (1) by the Trade Representative, in making the 
        determination required by subsection (b), and
          (2) by the administering authority and the 
        Commission, in making the determination required by 
        subsection (c).
  (e) Issuance of Order.--If the administering authority makes 
an affirmative determination under paragraph (1) of subsection 
(c), and the Commission makes an affirmative determination 
under paragraph (2) of subsection (c), the administering 
authority shall issue an antidumping duty order in accordance 
with section 736 and take such other actions as are required by 
section 736.
  (f) Reviews of Determinations.--For purposes of review under 
section 516A or review under section 751, if an order is issued 
under subsection (c), the final determinations of the 
administering authority and the Commission under this section 
shall be treated as final determinations made under section 
735.
  (g) Access to Information.--Section 777 shall apply to 
investigations under this section, to the extent specified by 
the Trade Representative, after consultation with the 
administering authority and the Commission.

                       9. Antidumping Act of 1916


     [15 U.S.C. 71 et seq.; Act of Sept. 8, 1916, sections 800-806]

SEC. 800. DEFINITION.

    When used in this subchapter, the term ``person'' includes 
partnerships, corporations, and associations.

SEC. 801. IMPORTATION OR SALE OF ARTICLES AT LESS THAN MARKET VALUE OR 
                    WHOLESALE PRICE.

    It shall be unlawful for any person importing or assisting 
in importing any articles from any foreign country into the 
United States, commonly and systematically to import, sell or 
cause to be imported or sold such articles within the United 
States at a price substantially less than the actual market 
value or wholesale price of such articles, at the time of 
exportation to the United States, in the principal markets of 
the country of their production, or of other foreign countries 
to which they are commonly exported after adding to such market 
value or wholesale price, freight, duty, and other charges and 
expenses necessarily incident to the importation and sale 
thereof in the United States: Provided, That such act or acts 
be done with the intent of destroying or injuring an industry 
in the United States, or of preventing the establishment of an 
industry in the United States, or of restraining or 
monopolizing any part of trade and commerce in such articles in 
the United States.
    Any person who violates or combines or conspires with any 
other person to violate this section is guilty of a 
misdemeanor, and, on conviction thereof, shall be punished by a 
fine not exceeding $5,000, or imprisonment not exceeding one 
year, or both, in the discretion of the court.
    Any person injured in his business or property by reason of 
any violation of, or combination or conspiracy to violate, this 
section, may sue therefor in the district court of the United 
States for the district in which the defendant resides or is 
found or has an agent, without respect to the amount in 
controversy, and shall recover threefold the damages sustained, 
and the cost of the suit, including a reasonable attorney's 
fee.
    The foregoing provisions shall not be construed to deprive 
the proper State courts of jurisdiction in actions for damages 
thereunder.

SEC. 802. AGREEMENTS INVOLVING RESTRICTIONS IN FAVOR OF IMPORTED GOODS.

    If any article produced in foreign country is imported into 
the United States under any agreement, understanding, or 
condition that the importer thereof or any other person in the 
United States shall not use, purchase, or deal in, or shall be 
restricted in his using, purchasing, or dealing in, the 
articles of any other person, there shall be levied, collected, 
and paid thereon, in addition to the duty otherwise imposed by 
law, a special duty paid thereon, in addition to the duty 
otherwise imposed by law, a special duty equal to double the 
amount of such duty: Provided, That the above shall not be 
interpreted to prevent the establishing in this country on the 
part of a foreign producer of an exclusive agency for the sale 
in the United States of the products of said foreign producer 
or merchant, nor to prevent such exclusive agent from agreeing 
not to use, purchase, or deal in the article of any other 
person, but this proviso shall not be construed to exempt from 
the provision of this section any article imported by such 
exclusive agent if such agent is required by the foreign 
producer or if it is agreed between such agent and such foreign 
producer that any agreement, understanding or condition set out 
in this section shall be imposed by such agent upon the sale or 
other disposition of such article to any person in the United 
States.

SEC. 803. RULES AND REGULATIONS.

    The Secretary of the Treasury shall make such rules and 
regulations as are necessary for the carrying out of the 
provisions of section 73 of this title.

SEC. 804. RETALIATION AGAINST COUNTRY PROHIBITING IMPORTATIONS.

    Whenever any country, dependency, or colony shall prohibit 
the importation of any article the product of the soil or 
industry of the United States and not injurious to health or 
morals, the President shall have power to prohibit, during the 
period such prohibition is in force, the importation into the 
United States of similar articles, or in case the United States 
does not import similar articles from that country, then other 
articles, the products of such country, dependency, or colony.
    And the Secretary of the Treasury, with the approval of the 
President, shall make such rules and regulations as are 
necessary for the execution of the provisions of this section.

SEC. 805. RETALIATION AGAINST RESTRICTION OF IMPORTATIONS IN TIME OF 
                    WAR.

    Whenever, during the existence of a war in which the United 
States is not engaged, the President shall be satisfied that 
there is reasonable ground to believe that under the laws, 
regulations, or practices of any country, colony, or dependency 
contrary to the law and practice of nations, the importation 
into their own or any other country, dependency, or colony of 
any article the product of the soil or industry of the United 
States and not injurious to health or morals is prevented or 
restricted the President is authorized and empowered to 
prohibit or restrict during the period such prohibition or 
restriction is in force, the importation into the United States 
of similar or other articles, products of such country, 
dependency, or colony as in his opinion the public interest may 
require; and in such case he shall make proclamation stating 
the article or articles which are prohibited from importation 
into the United States; and any person or persons who shall 
import, or attempt or conspire to import, or be concerned in 
importing, such articles, into the United States contrary to 
the prohibition in such proclamation, shall be liable to a fine 
of not less than $2,000 nor more than $50,000, or to 
imprisonment not to exceed two years, or both, in the 
discretion of the court. The President may change, modify, 
revoke, or renew such proclamation in his discretion.

SEC. 806. DISCRIMINATION AGAINST NEUTRAL AMERICANS IN TIME OF WAR.

    Whenever, during the existence of a war in which the United 
States is not engaged, the President shall be satisfied that 
there is reasonable ground to believe that any vessel, American 
or foreign, is, on account of the laws, regulations, or 
practices of a belligerent Government, making or giving any 
undue or unreasonable preference or advantage in any respect 
whatsoever to any particular person, company, firm, or 
corporation, or any particular description of traffic in the 
United States or its possessions or to any citizens of the 
United States residing in neutral countries abroad, or is 
subjecting any particular person, company, firm, or corporation 
or any particular description of traffic in the United States 
or its possessions, or any citizens of the United States 
residing in neutral countries abroad to any undue or 
unreasonable prejudice, disadvantage, injury, or discrimination 
in regard to accepting, receiving, transporting, or delivering, 
or refusing to accept, receive, transfer, or deliver any cargo, 
freight, or passengers, or in any other respect whatsoever, he 
is authorized and empowered to direct the detention of such 
vessels by withholding clearance or by formal notice forbidding 
departure, and to revoke, modify, or renew any such direction.
    Whenever, during the existence of a war in which the United 
States is not engaged, the President shall be satisfied that 
there is reasonable ground to believe that under the laws, 
regulations, or practices of any belligerent country or 
Government, American ships or American citizens are not 
accorded any of the facilities of commerce which the vessels or 
citizens of that belligerent country enjoy in the United States 
or its possessions, or are not accorded by such belligerent 
equal privileges or facilities of trade with vessels or 
citizens of any nationality other than that of such 
belligerent, the President is authorized and empowered to 
withhold clearance from one or more vessels of such belligerent 
country until such belligerent shall restore to such American 
vessels and American citizens reciprocal liberty of commerce 
and equal facilities of trade; or the President may direct that 
similar privileges and facilities, if any, enjoyed by vessels 
or citizens of such belligerent in the United States or its 
possessions be refused to vessels or citizens of such 
belligerent; and in such case he shall make proclamation of his 
direction stating the facilities and privileges which shall be 
refused, and the belligerent to whose vessels or citizens they 
are to be refused, and thereafter the furnishing of such 
prohibited privileges and facilities to any vessel or citizen 
of the belligerent named in such proclamation shall be 
unlawful; and he may change, modify, revoke, or renew such 
proclamation; and any person or persons who shall furnish or 
attempt or conspire to furnish or be concerned in furnishing or 
in the concealment of furnishing facilities or privileges to 
ships or persons contrary to the prohibition in such 
proclamation shall be liable to a fine of not less than $2,000 
nor more than $50,000 or to imprisonment not to exceed two 
years, or both, in the discretion of the court.
    In case any vessel which is detained by virtue of this 
subchapter shall depart or attempt to depart from the 
jurisdiction of the United States without clearance or other 
lawful authority, the owner or master or person or persons 
having charge or command of such vessel shall be severally 
liable to a fine of not less than $2,000 nor more than $10,000, 
or to imprisonment not to exceed two years, or both, and in 
addition such vessel shall be forfeited to the United States.
    The President of the United States is authorized and 
empowered to employ such part of the land or naval forces of 
the United States as shall be necessary to carry out the 
purposes of this subchapter.

   B. ENFORCEMENT OF UNITED STATES RIGHTS UNDER TRADE AGREEMENTS AND 
              RESPONSE TO CERTAIN FOREIGN TRADE PRACTICES


 Title III, Chapter 1 (Sections 301-310) of the Trade Act of 1974, as 
                                amended


 [19 U.S.C. 2411-2420; P.L. 93-618, as amended by P.L. 96-39, P.L. 98-
 573, P.L. 100-418, P.L. 103-465, P.L. 104-295, P.L. 106-113, and P.L. 
                                106-200]

SEC. 301. ACTIONS BY UNITED STATES TRADE REPRESENTATIVE.

      (a) Mandatory Action.--
          (1) If the United States Trade Representative 
        determines under section 304(a)(1) that--
                  (A) the rights of the United States under any 
                trade agreement are being denied; or
                  (B) an act, policy, or practice of a foreign 
                country--
                          (i) violates, or is inconsistent 
                        with, the provisions of, or otherwise 
                        denies benefits to the United States 
                        under, any trade agreement, or
                          (ii) is unjustifiable and burdens or 
                        restricts United States commerce;
        the Trade Representative shall take action authorized 
        in subsection (c), subject to the specific direction, 
        if any, of the President regarding any such action, and 
        shall take all other appropriate and feasible action 
        within the power of the President that the President 
        may direct the Trade Representative to take under this 
        subsection, to enforce such rights or to obtain the 
        elimination of such act, policy, or practice.
Actions may be taken that are within the power of the President 
with respect to trade in any goods or services, or with respect 
to any other area of pertinent relations with the foreign 
country.
          (2) The Trade Representative is not required to take 
        action under paragraph (1) in any case in which--
                  (A) The Dispute Settlement Body (as defined 
                in section 121(5) of the Uruguay Round 
                Agreements Act) has adopted a report, or a 
                ruling issued under the formal dispute 
                settlement proceeding provided under any other 
                trade agreement finds, that--
                          (i) the rights of the United States 
                        under a trade agreement are not being 
                        denied, or
                          (ii) the act, policy, or practice--
                                  (I) is not a violation of, or 
                                inconsistent with, the rights 
                                of the United States, or
                                  (II) does not deny, nullify, 
                                or impair benefits to the 
                                United States under any trade 
                                agreement; or
                  (B) the Trade Representative finds that--
                          (i) the foreign country is taking 
                        satisfactory measures to grant the 
                        rights of the United States under a 
                        trade agreement,
                          (ii) the foreign country has--
                                  (I) agreed to eliminate or 
                                phase out the act, policy, or 
                                practice, or
                                  (II) agreed to an imminent 
                                solution to the burden or 
                                restriction on United States 
                                commerce that is satisfactory 
                                to the Trade Representative,
                          (iii) it is impossible for the 
                        foreign country to achieve the results 
                        described in clause (i) or (ii), as 
                        appropriate, but the foreign country 
                        agrees to provide to the United States 
                        compensatory trade benefits that are 
                        satisfactory to the Trade 
                        Representative,
                          (iv) in extraordinary cases, where 
                        the taking of action under this 
                        subsection would have an adverse impact 
                        on the United States economy 
                        substantially out of proportion to the 
                        benefits of such action, taking into 
                        account the impact of not taking such 
                        action on the credibility of the 
                        provisions of this chapter, or
                          (v) the taking of action under this 
                        subsection would cause serious harm to 
                        the national security of the United 
                        States.
          (3) Any action taken under paragraph (1) to eliminate 
        an act, policy, or practice shall be devised so as to 
        affect goods or services of the foreign country in an 
        amount that is equivalent in value to the burden or 
        restriction being imposed by that country on United 
        States commerce.
    (b) Discretionary Action.--If the Trade Representative 
determines under section 304(a)(1) that--
          (1) an act, policy, or practice of a foreign country 
        is unreasonable or discriminatory and burdens or 
        restricts United States commerce, and
          (2) action by the United States is appropriate, the 
        Trade Representative shall take all appropriate and 
        feasible action authorized under subsection (c), 
        subject to the specific direction, if any, of the 
        President regarding any such action, and all other 
        appropriate and feasible action within the power of the 
        President that the President may direct the Trade 
        Representative to take under this subsection, to obtain 
        the elimination of that act, policy, or practice.
Actions may be taken that are within the power of the President 
with respect to trade in any goods or services, or with respect 
to any other area of pertinent relations with the foreign 
country.
    (c) Scope of Authority.--
          (1) For purposes of carrying out the provisions of 
        subsection (a) or (b), the Trade Representative is 
        authorized to--
                  (A) suspend, withdraw, or prevent the 
                application of, benefits of trade agreement 
                concessions to carry out a trade agreement with 
                the foreign country referred to in such 
                subsection;
                  (B) impose duties or other import 
                restrictions on the goods of, and, 
                notwithstanding any other provision of law, 
                fees or restrictions on the services of, such 
                foreign country for such time as the Trade 
                Representative determines appropriate;
                  (C) in a case in which the act, policy, or 
                practice also fails to meet the eligibility 
                criteria for receiving duty-free treatment 
                under subsections (b) and (c) of section 502 of 
                this Act, subsections (b) and (c) of section 
                212 of the Caribbean Basin Economic Recovery 
                Act (19 U.S.C. 2702 (b) and (c)), or 
                subsections (c) and (d) of section 203 of the 
                Andean Trade Preference Act (19 U.S.C. 3202 (c) 
                and (d)), withdraw, limit, or suspend such 
                treatment under such provisions, 
                notwithstanding the provisions of subsection 
                (a)(3) of this section; or
                  (D) enter into binding agreements with such 
                foreign country that commit such foreign 
                country to--
                          (i) eliminate, or phase out, the act, 
                        policy, or practice that is the subject 
                        of the action to be taken under 
                        subsection (a) or (b),
                          (ii) eliminate any burden or 
                        restriction on United States commerce 
                        resulting from such act, policy, or 
                        practice, or
                          (iii) provide the United States with 
                        compensatory trade benefits that--
                                  (I) are satisfactory to the 
                                Trade Representative, and
                                  (II) meet the requirements of 
                                paragraph (4).
          (2)(A) Notwithstanding any other provision of law 
        governing any service sector access authorization, and 
        in addition to the authority conferred in paragraph 
        (1), the Trade Representative may, for purposes of 
        carrying out the provisions of subsection (a) or (b)--
                  (i) restrict, in the manner and to the extent 
                the Trade Representative determines 
                appropriate, the terms and conditions of any 
                such authorization, or
                  (ii) deny the issuance of any such 
                authorization.
          (B) Actions described in subparagraph (A) may only be 
        taken under this section with respect to service sector 
        access authorizations granted, or applications therefor 
        pending, on or after the date on which--
                  (i) a petition is filed under section 302(a), 
                or
                  (ii) a determination to initiate an 
                investigation is made by the Trade 
                Representative under section 302(b).
          (C) Before the Trade Representative takes any action 
        under this section involving the imposition of fees or 
        other restrictions on the services of a foreign 
        country, the Trade Representative shall, if the 
        services involved are subject to regulation by any 
        agency of the Federal Government or of any State, 
        consult, as appropriate, with the head of the agency 
        concerned.
          (3) The actions the Trade Representative is 
        authorized to take under subsection (a) or (b) may be 
        taken against any goods or economic sector--
                  (A) on a nondiscriminatory basis or solely 
                against the foreign country described in such 
                subsection, and
                  (B) without regard to whether or not such 
                goods or economic sector were involved in the 
                act, policy, or practice that is the subject of 
                such action.
          (4) Any trade agreement described in paragraph 
        (1)(D)(iii) shall provide compensatory trade benefits 
        that benefit the economic sector which includes the 
        domestic industry that would benefit from the 
        elimination of the act, policy, or practice that is the 
        subject of the action to be taken under subsection (a) 
        or (b), or benefit the economic sector as closely 
        related as possible to such economic sector, unless--
                  (A) the provision of such trade benefits is 
                not feasible, or
                  (B) trade benefits that benefit any other 
                economic sector would be more satisfactory than 
                such trade benefits.
          (5) If the Trade Representative determines that 
        actions to be taken under subsection (a) or (b) are to 
        be in the form of import restrictions, the Trade 
        Representative shall--
                  (A) give preference to the imposition of 
                duties over the imposition of other import 
                restrictions, and
                  (B) if an import restriction other than a 
                duty is imposed, consider substituting, on an 
                incremental basis, an equivalent duty for such 
                other import restriction.
          (6) Any action taken by the Trade Representative 
        under this section with respect to export targeting 
        shall, to the extent possible, reflect the full benefit 
        level of the export targeting to the beneficiary over 
        the period during which the action taken has an effect.
    (d) Definitions and Special Rules.--For purposes of this 
chapter--
          (1) The term ``commerce'' includes, but is not 
        limited to--
                  (A) services (including transfers of 
                information) associated with international 
                trade, whether or not such services are related 
                to specific goods, and
                  (B) foreign direct investment by United 
                States persons with implications for trade in 
                goods or services.
          (2) An act, policy, or practice of a foreign country 
        that burdens or restricts United States commerce may 
        include the provision, directly or indirectly, by that 
        foreign country of subsidies for the construction of 
        vessels used in the commercial transportation by water 
        of goods between foreign countries and the United 
        States.
          (3)(A) An act, policy, or practice is unreasonable if 
        the act, policy, or practice, while not necessarily in 
        violation of, or inconsistent with, the international 
        legal rights of the United States, is otherwise unfair 
        and inequitable.
          (B) Acts, policies, and practices that are 
        unreasonable include, but are not limited to, any act, 
        policy, or practice, or any combination of acts, 
        policies, or practices, which--
                  (i) denies fair and equitable--
                          (I) opportunities for the 
                        establishment of an enterprise,
                          (II) provision of adequate and 
                        effective protection of intellectual 
                        property rights notwithstanding the 
                        fact that the foreign country may be in 
                        compliance with the specific 
                        obligations of the Agreement on Trade-
                        Related Aspects of Intellectual 
                        Property Rights referred to in section 
                        101(d)(15) of the Uruguay Round 
                        Agreements Act,
                          (III) nondiscriminatory market access 
                        opportunities for United States persons 
                        that rely upon intellectual property 
                        protection, or
                          (IV) market opportunities, including 
                        the toleration by a foreign government 
                        of systematic anticompetitive 
                        activities by enterprises or among 
                        enterprises in the foreign country that 
                        have the effect of restricting, on a 
                        basis that is inconsistent with 
                        commercial considerations, access of 
                        United States goods or services to a 
                        foreign market,
                  (ii) constitutes export targeting, or
                  (iii) constitutes a persistent pattern of 
                conduct that--
                          (I) denies workers the right of 
                        association,
                          (II) denies workers the right to 
                        organize and bargain collectively,
                          (III) permits any form of forced or 
                        compulsory labor,
                          (IV) fails to provide a minimum age 
                        for the employment of children, or
                          (V) fails to provide standards for 
                        minimum wages, hours of work, and 
                        occupational safety and health of 
                        workers.
          (C)(i) Acts, policies, and practices of a foreign 
        country described in subparagraph (B)(iii) shall not be 
        treated as being unreasonable if the Trade 
        Representative determines that--
                  (I) the foreign country has taken, or is 
                taking, actions that demonstrate a significant 
                and tangible overall advancement in providing 
                throughout the foreign country (including any 
                designated zone within the foreign country) the 
                rights and other standards described in the 
                subclauses of subparagraph (B)(iii), or
                  (II) such acts, policies, and practices are 
                not inconsistent with the level of economic 
                development of the foreign country.
          (ii) The Trade Representative shall publish in the 
        Federal Register any determination made under clause 
        (i), together with a description of the facts on which 
        such determination is based.
          (D) For purposes of determining whether any act, 
        policy, or practice is unreasonable, reciprocal 
        opportunities in the United States for foreign 
        nationals and firms shall be taken into account, to the 
        extent appropriate.
          (E) The term ``export targeting'' means any 
        government plan or scheme consisting of a combination 
        of coordinated actions (whether carried out severally 
        or jointly) that are bestowed on a specific enterprise, 
        industry, or group thereof, the effect of which is to 
        assist the enterprise, industry, or group to become 
        more competitive in the export of a class or kind of 
        merchandise.
          (F)(i) For the purposes of subparagraph (B)(i)(II), 
        adequate and effective protection of intellectual 
        property rights includes adequate and effective means 
        under the laws of the foreign country for persons who 
        are not citizens or nationals of such country to 
        secure, exercise, and enforce rights and enjoy 
        commercial benefits relating to patents, trademarks, 
        copyrights and related rights, mask works, trade 
        secrets, and plant breeder's rights.
                  (ii) For purposes of subparagraph (B)(i)(IV), 
                the denial of fair and equitable 
                nondiscriminatory market access opportunities 
                includes restrictions on market access related 
                to the use, exploitation, or enjoyment of 
                commercial benefits derived from exercising 
                intellectual property rights in protected works 
                or fixations or products embodying protected 
                works.
          (4)(A) An act, policy, or practice is unjustifiable 
        if the act, policy, or practice is in violation of, or 
        inconsistent with, the international legal rights of 
        the United States.
          (B) Acts, policies, and practices that are 
        unjustifiable include, but are not limited to, any act, 
        policy, or practice described in subparagraph (A) which 
        denies national or most-favored-nation treatment or the 
        right of establishment or protection of intellectual 
        property rights.
          (5) Acts, policies, and practices that are 
        discriminatory include, when appropriate, any act, 
        policy, and practice which denies national or most-
        favored-nation treatment to United States goods, 
        services, or investment.
          (6) The term ``service sector access authorization'' 
        means any license, permit, order, or other 
        authorization, issued under the authority of Federal 
        law, that permits a foreign supplier of services access 
        to the United States market in a service sector 
        concerned.
          (7) The term ``foreign country'' includes any foreign 
        instrumentality. Any possession or territory of a 
        foreign country that is administered separately for 
        customs purposes shall be treated as a separate foreign 
        country.
          (8) The term ``Trade Representative'' means the 
        United States Trade Representative.
          (9) The term ``interested persons'', only for 
        purposes of sections 302(a)(4)(B), 304(b)(1)(A), 
        306(c)(2), and 307(a)(2), includes, but is not limited 
        to, domestic firms and workers, representatives of 
        consumer interests, United States product exporters, 
        and any industrial user of any goods or services that 
        may be affected by actions taken under subsection (a) 
        or (b).

SEC. 302. INITIATION OF INVESTIGATIONS.

    (a) Petitions.--
          (1) Any interested person may file a petition with 
        the Trade Representative requesting that action be 
        taken under section 301 and setting forth the 
        allegations in support of the request.
          (2) The Trade Representative shall review the 
        allegations in any petition filed under paragraph (1) 
        and, not later than 45 days after the date on which the 
        Trade Representative received the petition, shall 
        determine whether to initiate an investigation.
          (3) If the Trade Representative determines not to 
        initiate an investigation with respect to a petition, 
        the Trade Representative shall inform the petitioner of 
        the reasons therefor and shall publish notice of the 
        determination, together with a summary of such reasons, 
        in the Federal Register.
          (4) If the Trade Representative makes an affirmative 
        determination under paragraph (2) with respect to a 
        petition, the Trade Representative shall initiate an 
        investigation regarding the issues raised in the 
        petition. The Trade Representative shall publish a 
        summary of the petition in the Federal Register and 
        shall, as soon as possible, provide opportunity for the 
        presentation of views concerning the issues, including 
        a public hearing--
                  (A) within the 30-day period beginning on the 
                date of affirmative determination (or on a date 
                after such period if agreed to by the 
                petitioner) if a public hearing within such 
                period is requested in the petition, or
                  (B) at such other time if a timely request 
                therefor is made by the petitioner or by any 
                interested person.
    (b) Initiation of Investigation by Means Other Than 
Petition.--
          (1)(A) If the Trade Representative determines that an 
        investigation should be initiated under this chapter 
        with respect to any matter in order to determine 
        whether the matter is actionable under section 301, the 
        Trade Representative shall publish such determination 
        in the Federal Register and shall initiate such 
        investigation.
          (B) The Trade Representative shall, before making any 
        determination under subparagraph (A), consult with 
        appropriate committees established pursuant to section 
        135.
          (2)(A) By no later than the date that is 30 days 
        after the date on which a country is identified under 
        section 182(a)(2), the Trade Representative shall 
        initiate an investigation under this chapter with 
        respect to any act, policy, or practice of that country 
        that--
                  (i) was the basis for such identification, 
                and
                  (ii) is not at that time the subject of any 
                other investigation or action under this 
                chapter.
          (B) The Trade Representative is not required under 
        subparagraph (A) to initiate an investigation under 
        this chapter with respect to any act, policy, or 
        practice of a foreign country if the Trade 
        Representative determines that the initiation of the 
        investigation would be detrimental to United States 
        economic interests.
          (C) If the Trade Representative makes a determination 
        under subparagraph (B) not to initiate an 
        investigation, the Trade Representative shall submit to 
        the Congress a written report setting forth, in 
        detail--
                  (i) the reasons for the determination, and
                  (ii) the United States economic interests 
                that would be adversely affected by the 
                investigation.
          (D) The Trade Representative shall, from time to 
        time, consult with the Register of Copyrights, the 
        Under Secretary of Commerce for Intellectual Property 
        and Director of the United States Patent and Trademark 
        Office, and other appropriate officers of the Federal 
        Government, during any investigation initiated under 
        this chapter by reason of subparagraph (A).
    (c) Discretion.--In determining whether to initiate an 
investigation under subsection (a) or (b) of any act, policy, 
or practice that is enumerated in any provision of section 
301(d), the Trade Representative shall have discretion to 
determine whether action under section 301 would be effective 
in addressing such act, policy, or practice.

SEC. 303. CONSULTATION UPON INITIATION OF INVESTIGATION.

    (a) In General.--
          (1) On the date on which an investigation is 
        initiated under section 302, the Trade Representative, 
        on behalf of the United States, shall request 
        consultations with the foreign country concerned 
        regarding the issues involved in such investigation.
          (2) If the investigation initiated under section 302 
        involves a trade agreement and a mutually acceptable 
        resolution is not reached before the earlier of--
                  (A) the close of the consultation period, if 
                any, specified in the trade agreement, or
                  (B) the 150th day after the day on which 
                consultation was commenced,
        the Trade Representative shall promptly request 
        proceedings on the matter under the formal dispute 
        settlement procedures provided under such agreement.
          (3) The Trade Representative shall seek information 
        and advice from the petitioner (if any) and the 
        appropriate committees established pursuant to section 
        135 in preparing United States presentations for 
        consultations and dispute settlement proceedings.
    (b) Delay of Request for Consultations.--
          (1) Notwithstanding the provisions of subsection 
        (a)--
                  (A) the United States Trade Representative 
                may, after consulting with the petitioner (if 
                any), delay for up to 90 days any request for 
                consultations under subsection (a) for the 
                purpose of verifying or improving the petition 
                to ensure an adequate basis for consultation, 
                and
                  (B) if such consultations are delayed by 
                reason of subparagraph (A), each time 
                limitation under section 304 shall be extended 
                for the period of such delay.
          (2) The Trade Representative shall--
                  (A) publish notice of any delay under 
                paragraph (1) in the Federal Register, and
                  (B) report to Congress on the reasons for 
                such delay in the report required under section 
                309(a)(3).

SEC. 304. DETERMINATIONS BY THE TRADE REPRESENTATIVE.

    (a) In General.--
          (1) On the basis of the investigation initiated under 
        section 302 and the consultations (and the proceedings, 
        if applicable) under section 303, the Trade 
        Representative shall--
                  (A) determine whether--
                          (i) the rights to which the United 
                        States is entitled under any trade 
                        agreement are being denied, or
                          (ii) any act, policy, or practice 
                        described in subsection (a)(1)(B) or 
                        (b)(1) of section 301 exists, and
                  (B) if the determination made under 
                subparagraph (A) is affirmative, determine what 
                action, if any, the Trade Representative should 
                take under subsection (a) or (b) of section 
                301.
          (2) The Trade Representative shall make the 
        determinations required under paragraph (1) on or 
        before--
                  (A) in the case of an investigation involving 
                a trade agreement, the earlier of--
                          (i) the date that is 30 days after 
                        the date on which the dispute 
                        settlement procedure is concluded, or
                          (ii) the date that is 18 months after 
                        the date on which the investigation is 
                        initiated, or
                  (B) in all cases not described in 
                subparagraph (A) or paragraph (3), the date 
                that is 12 months after the date on which the 
                investigation is initiated.
          (3)(A) If an investigation is initiated under this 
        chapter by reason of section 302(b)(2) and the Trade 
        Representative does not consider that a trade 
        agreement, including the Agreement on Trade-Related 
        Aspects of Intellectual Property Rights (referred to in 
        section 101(d)(15) of the Uruguay Round Agreements 
        Act), is involved or does not make a determination 
        described in subparagraph (B) with respect to such 
        investigation, the Trade Representative shall make the 
        determinations required under paragraph (1) with 
        respect to such investigation by no later than the date 
        that is 6 months after the date on which such 
        investigation is initiated.
          (B) If the Trade Representative determines with 
        respect to an investigation initiated by reason of 
        section 302(b)(2) (other than an investigation 
        involving a trade agreement) that--
                  (i) complex or complicated issues are 
                involved in the investigation that require 
                additional time,
                  (ii) the foreign country involved in the 
                investigation is making substantial progress in 
                drafting or implementing legislative or 
                administrative measures that will provide 
                adequate and effective protection of 
                intellectual property rights, or
                  (iii) such foreign country is undertaking 
                enforcement measures to provide adequate and 
                effective protection of intellectual property 
                rights,
        the Trade Representative shall publish in the Federal 
        Register notice of such determination and shall make 
        the determinations required under paragraph (1) with 
        respect to such investigation by no later than the date 
        that is 9 months after the date on which such 
        investigation is initiated.
          (4) In any case in which a dispute is not resolved 
        before the close of the minimum dispute settlement 
        period provided for in a trade agreement, the Trade 
        Representative, within 15 days after the close of such 
        dispute settlement period, shall submit a report to 
        Congress setting forth the reasons why the dispute was 
        not resolved within the minimum dispute settlement 
        period, the status of the case at the close of the 
        period, and the prospects for resolution. For purposes 
        of this paragraph, the minimum dispute settlement 
        period provided for under any such trade agreement is 
        the total period of time that results if all stages of 
        the formal dispute settlement procedures are carried 
        out within the time limitations specified in the 
        agreement, but computed without regard to any extension 
        authorized under the agreement at any stage.
    (b) Consultation Before Determinations.--
          (1) Before making the determinations required under 
        subsection (a)(1), the Trade Representative, unless 
        expeditious action is required--
                  (A) shall provide an opportunity (after 
                giving not less than 30 days notice thereof) 
                for the presentation of views by interested 
                persons, including a public hearing if 
                requested by any interested person,
                  (B) shall obtain advice from the appropriate 
                committees established pursuant to section 135, 
                and
                  (C) may request the views of the United 
                States International Trade Commission regarding 
                the probable impact on the economy of the 
                United States of the taking of action with 
                respect to any goods or service.
          (2) If the Trade Representative does not comply with 
        the requirements of subparagraphs (A) and (B) of 
        paragraph (1) because expeditious action is required, 
        the Trade Representative shall, after making the 
        determinations under subsection (a)(1), comply with 
        such subparagraphs.
    (c) Publication.--The Trade Representative shall publish in 
the Federal Register any determination made under subsection 
(a)(1), together with a description of the facts on which such 
determination is based.

SEC. 305. IMPLEMENTATION OF ACTIONS.

    (a) Actions To Be Taken Under Section 301.--
          (1) Except as provided in paragraph (2), the Trade 
        Representative shall implement the action the Trade 
        Representative determines under section 304(a)(1)(B) to 
        take under section 301, subject to the specific 
        direction, if any, of the President regarding any such 
        action, by no later than the date that is 30 days after 
        the date on which such determination is made.
          (2)(A) Except as otherwise provided in this 
        paragraph, the Trade Representative may delay, by not 
        more than 180 days, the implementation of any action 
        that is to be taken under section 301--
                  (i) if--
                          (I) in the case of an investigation 
                        initiated under section 302(a), the 
                        petitioner requests a delay, or
                          (II) in the case of an investigation 
                        initiated under section 302(b)(1) or to 
                        which section 304(a)(3)(B) applies, a 
                        delay is requested by a majority of the 
                        representatives of the domestic 
                        industry that would benefit from the 
                        action, or
                  (ii) if the Trade Representative determines 
                that substantial progress is being made, or 
                that a delay is necessary or desirable to 
                obtain United States rights or satisfactory 
                solution with respect to the acts, policies, or 
                practices that are the subject of the action.
          (B) The Trade Representative may not delay under 
        subparagraph (A) the implementation of any action that 
        is to be taken under section 301 with respect to any 
        investigation to which section 304(a)(3)(A) applies.
          (C) The Trade Representative may not delay under 
        subparagraph (A) the implementation of any action that 
        is to be taken under section 301 with respect to any 
        investigation to which section 304(a)(3)(B) applies by 
        more than 90 days.
    (b) Alternative Actions in Certain Cases of Export 
Targeting.--
          (1) If the Trade Representative makes an affirmative 
        determination under section 304(a)(1)(A) involving 
        export targeting by a foreign country and determines to 
        take no action under section 301 with respect to such 
        affirmation determination, the Trade Representative--
                  (A) shall establish an advisory panel to 
                recommend measures which will promote the 
                competitiveness of the domestic industry 
                affected by the export targeting,
                  (B) on the basis of the report of such panel 
                submitted under paragraph (2)(B) and subject to 
                the specific direction, if any, of the 
                President, may take any administrative actions 
                authorized under any other provision of law, 
                and, if necessary, propose legislation to 
                implement any other actions, that would restore 
                or improve the international competitiveness of 
                the domestic industry affected by the export 
                targeting, and
                  (C) shall, by no later than the date that is 
                30 days after the date on which the report of 
                such panel is submitted under paragraph (2)(B), 
                submit a report to the Congress on the 
                administrative actions taken, and legislative 
                proposals made, under subparagraph (B) with 
                respect to the domestic industry affected by 
                the export targeting.
          (2)(A) The advisory panels established under 
        paragraph (1)(A) shall consist of individuals appointed 
        by the Trade Representative who--
                  (i) earn their livelihood in the private 
                sector of the economy, including individuals 
                who represent management and labor in the 
                domestic industry affected by the export 
                targeting that is the subject of the 
                affirmative determination made under section 
                304(a)(1)(A), and
                  (ii) by education or experience, are 
                qualified to serve on the advisory panel.
          (B) By no later than the date that is 6 months after 
        the date on which an advisory panel is established 
        under paragraph (1)(A), the advisory panel shall submit 
        to the Trade Representative and to the Congress a 
        report on measures that the advisory panel recommends 
        be taken by the United States to promote the 
        competitiveness of the domestic industry affected by 
        the export targeting that is the subject of the 
        affirmative determination made under section 
        304(a)(1)(A).

SEC. 306. MONITORING OF FOREIGN COMPLIANCE.

    (a) In General.--The Trade Representative shall monitor the 
implementation of each measure undertaken, or agreement that is 
entered into to by a foreign country provide a satisfactory 
resolution of a matter subject to investigation under this 
chapter or subject to dispute settlement proceedings to enforce 
the rights of the United States under a trade agreement 
providing for such proceedings.
    (b) Further Action.--
          (1) In general.--If, on the basis of the monitoring 
        carried out under subsection (a), the Trade 
        Representative considers that a foreign country is not 
        satisfactorily implementing a measure or agreement 
        referred to in subsection (a), the Trade Representative 
        shall determine what further action the Trade 
        Representative shall take under section 301(a). For 
        purposes of section 301, any such determination shall 
        be treated as a determination made under section 
        304(a)(1).
          (2) WTO dispute settlement recommendations.--
                  (A) Failure to implement Recommendation.--If 
                the measure or agreement referred to in 
                subsection (a) concerns the implementation of a 
                recommendation made pursuant to dispute 
                settlement proceedings under the World Trade 
                Organization, and the Trade Representative 
                considers that the foreign country has failed 
                to implement it, the Trade Representative shall 
                make the determination in paragraph (1) no 
                later than 30 days after the expiration of the 
                reasonable period of time provided for such 
                implementation under paragraph 21 of the 
                Understanding on Rules and Procedures Governing 
                the Settlement of Disputes that is referred to 
                in section 101(d)(16) of the Uruguay Round 
                Agreements Act.
                  (B) Revision of retaliation list and 
                action.--
                          ``(i) In general.--Except as provided 
                        in clause (ii), in the event that the 
                        United States initiates a retaliation 
                        list or takes any other action 
                        described in section 301(c)(1) (A) or 
                        (B) against the goods of a foreign 
                        country or countries because of the 
                        failure of such country or countries to 
                        implement the recommendation made 
                        pursuant to a dispute settlement 
                        proceeding under the World Trade 
                        Organization, the Trade Representative 
                        shall periodically revise the list or 
                        action to affect other goods of the 
                        country or countries that have failed 
                        to implement the recommendation.
                          (ii) Exception.--The Trade 
                        Representative is not required to 
                        revise the retaliation list or the 
                        action described in clause (i) with 
                        respect to a country, if--
                                  (I) the Trade Representative 
                                determines that implementation 
                                of a recommendation made 
                                pursuant to a dispute 
                                settlement proceeding described 
                                in clause (i) by the country is 
                                imminent; or
                                  (II) the Trade Representative 
                                together with the petitioner 
                                involved in the initial 
                                investigation under this 
                                chapter (or if no petition was 
                                filed, the affected United 
                                States industry) agree that it 
                                is unnecessary to revise the 
                                retaliation list.
                  ``(C) Schedule for revising list or action.--
                The Trade Representative shall, 120 days after 
                the date the retaliation list or other section 
                301(a) action is first taken, and every 180 
                days thereafter, review the list or action 
                taken and revise, in whole or in part, the list 
                or action to affect other goods of the subject 
                country or countries.
                  (D) Standards for revising list or action.--
                In revising any list or action against a 
                country or countries under this subsection, the 
                Trade Representative shall act in a manner that 
                is most likely to result in the country or 
                countries implementing the recommendations 
                adopted in the dispute settlement proceeding or 
                in achieving a mutually satisfactory solution 
                to the issue that gave rise to the dispute 
                settlement proceeding. The Trade Representative 
                shall consult with the petitioner, if any, 
                involved in the initial investigation under 
                this chapter.
                  (E) Retaliation list.--The term ``retaliation 
                list'' means the list of products of a foreign 
                country or countries that have failed to comply 
                with the report of the panel or appellate Body 
                of the WTO and with respect to which the Trade 
                Representative is imposing duties above the 
                level that would otherwise be imposed under the 
                Harmonized Tariff Schedule of the United 
                States.
                  (F) Requirement to include reciprocal goods 
                on retaliation list.--The Trade Representative 
                shall include on the retaliation list, and on 
                any revised lists, reciprocal goods of the 
                industries affected by the failure of the 
                foreign country or countries to implement the 
                recommendation made pursuant to a dispute 
                settlement proceeding under the World Trade 
                Organization, except in cases where existing 
                retaliation and its corresponding preliminary 
                retaliation list do not already meet the 
                requirement.
    (c) Consultations.--Before making any determination under 
subsection (b), the Trade Representative shall--
          (1) consult with the petitioner, if any, involved in 
        the initial investigation under this chapter and with 
        representatives of the domestic industry concerned; and
          (2) provide an opportunity for the presentation of 
        views by interested persons.

SEC. 307. MODIFICATION AND TERMINATION OF ACTIONS.

    (a) In General.--
          (1) The Trade Representative may modify or terminate 
        any action, subject to the specific direction, if any, 
        of the President with respect to such action, that is 
        being taken under section 301 if--
                  (A) any of the conditions described in 
                section 301(a)(2) exist,
                  (B) the burden or restriction on United 
                States commerce of the denial rights, or of the 
                acts, policies, and practices, that are the 
                subject of such action has increased or 
                decreased, or
                  (C) such action is being taken under section 
                301(b) and is no longer appropriate.
          (2) Before taking any action under paragraph (1) to 
        modify or terminate any action taken under section 301, 
        the Trade Representative shall consult with the 
        petitioner, if any, and with representatives of the 
        domestic industry concerned, and shall provide 
        opportunity for the presentation of views by other 
        interested persons affected by the proposed 
        modification or termination concerning the effects of 
        the modification or termination and whether any 
        modification or termination of the action is 
        appropriate.
    (b) Notice; Report to Congress.--The Trade Representative 
shall promptly publish in the Federal Register notice of, and 
report in writing to the Congress with respect to, any 
modification or termination of any action taken under section 
301 and the reasons therefor.
    (c) Review of Necessity.--
          (1) If--
                  (A) a particular action has been taken under 
                section 301 during any 4-year period, and
                  (B) neither the petitioner nor any 
                representative of the domestic industry which 
                benefits from such action has submitted to the 
                Trade Representative during the last 60 days of 
                such 4-year period a written request for the 
                continuation of such action,
        such action shall terminate at the close of such 4-year 
        period.
          (2) The Trade Representative shall notify by mail the 
        petitioner and representatives of the domestic industry 
        described in paragraph (1)(B) of any termination of 
        action by reason of paragraph (1) at least 60 days 
        before the date of such termination.
          (3) If a request is submitted to the Trade 
        Representative under paragraph (1)(B) to continue 
        taking a particular action under section 301, the Trade 
        Representative shall conduct a review of--
                  (A) the effectiveness in achieving the 
                objectives of section 301 of--
                          (i) such action, and
                          (ii) other actions that could be 
                        taken (including actions against other 
                        products or services), and
                  (B) the effects of such actions on the United 
                States economy, including consumers.

SEC. 308. REQUEST FOR INFORMATION.

    (a) In General.--Upon receipt of written request therefor 
from any person, the Trade Representative shall make available 
to that person information (other than that to which 
confidentiality applies) concerning--
          (1) the nature and extent of a specific trade policy 
        or practice of a foreign country with respect to 
        particular goods, services, investment, or intellectual 
        property rights, to the extent that such information is 
        available to the Trade Representative, or other Federal 
        agencies;
          (2) United States rights under any trade agreement 
        and the remedies which may be available under that 
        agreement and under the laws of the United States; and
          (3) past and present domestic and international 
        proceedings or actions with respect to the policy or 
        practice concerned.
    (b) If Information Not Available.--If information that is 
requested by a person under subsection (a) is not available to 
the Trade Representative or other Federal agencies, the Trade 
Representative shall, within 30 days after receipt of the 
request--
          (1) request the information from the foreign 
        government; or
          (2) decline to request the information and inform the 
        person in writing of the reasons for refusal.
    (c) Certain Business Information Not Made Available.--
          (1) Except as provided in paragraph (2), and 
        notwithstanding any other provision of law (including 
        section 552 of title 5, United States Code), no 
        information requested and received by the Trade 
        Representative in aid of any investigation under this 
        chapter shall be made available to any person if--
                  (A) the person providing such information 
                certifies that--
                          (i) such information is business 
                        confidential,
                          (ii) the disclosure of such 
                        information would endanger trade 
                        secrets or profitability, and
                          (iii) such information is not 
                        generally available;
                  (B) the Trade Representative determines that 
                such certification is well-founded; and
                  (C) to the extent required in regulations 
                prescribed by the Trade Representative, the 
                person providing such information provides an 
                adequate nonconfidential summary of such 
                information.
          (2) The Trade Representative may--
                  (A) use such information, or make such 
                information available (in his own discretion) 
                to any employee of the Federal Government for 
                use, in any investigation under this chapter, 
                or
                  (B) may make such information available to 
                any other person in a form which cannot be 
                associated with, or otherwise identify, the 
                person providing the information.

SEC. 309. ADMINISTRATION.

    The Trade Representative shall--
          (1) issue regulations concerning the filing of 
        petitions and the conduct of investigations and 
        hearings under this subchapter,
          (2) keep the petitioner regularly informed of all 
        determinations and developments regarding the 
        investigation conducted with respect to the petition 
        under this chapter, including the reasons for any undue 
        delays, and
          (3) submit a report to the House of Representatives 
        and the Senate semiannually describing--
                  (A) the petitions filed and the 
                determinations made (and reasons therefor) 
                under section 302,
                  (B) developments in, and the current status 
                of, each investigation or proceeding under this 
                chapter,
                  (C) the actions taken, or the reasons for no 
                action, by the Trade Representative under 
                section 301 with respect to investigations 
                conducted under this chapter, and
                  (D) the commercial effects of actions taken 
                under section 301.

SEC. 310. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

    (a) Identification.--
          (1) Within 180 days after the submission in calendar 
        year 1995 of the report required by section 181(b), the 
        Trade Representative shall--
                  (A) review United States trade expansion 
                priorities,
                  (B) identify priority foreign country 
                practices, the elimination of which is likely 
                to have the most significant potential to 
                increase United States exports, either directly 
                or through the establishment of a beneficial 
                precedent, and
                  (C) submit to the Committee on Finance of the 
                Senate and the Committee on Ways and Means of 
                the House of Representatives and publish in the 
                Federal Register a report on the priority 
                foreign country practices identified.
          (2) In identifying priority foreign country practices 
        under paragraph (1) of this section, the Trade 
        Representative shall take into account all relevant 
        factors, including--
                  (A) the major barriers and trade distorting 
                practices described in the National Trade 
                Estimate Report required under section 181(b);
                  (B) the trade agreements to which a foreign 
                country is a party and its compliance with 
                those agreements;
                  (C) the medium- and long-term implications of 
                foreign government procurement plans; and
                  (D) the international competitive position 
                and export potential of United States products 
                and services.
          (3) The Trade Representative may include in the 
        report, if appropriate--
                  (A) a description of foreign country 
                practices that may in the future warrant 
                identification as priority foreign country 
                practices; and
                  (B) a statement about other foreign country 
                practices that were not identified because they 
                are already being addressed by provisions of 
                United States trade law, by existing bilateral 
                trade agreements, or as part of trade 
                negotiations with other countries and progress 
                is being made toward the elimination of such 
                practices.
    (b) Initiation of Investigations.--By no later than the 
date which is 21 days after the date on which a report is 
submitted to the appropriate congressional committees under 
subsection (a)(1), the Trade Representative shall initiate 
under section 302(b)(1) investigations under this chapter with 
respect to all of the priority foreign country practices 
identified.
    (c) Agreements for the Elimination of Barriers.--In the 
consultations with a foreign country that the Trade 
Representative is required to request under section 303(a) with 
respect to an investigation initiated by reason of subsection 
(b), the Trade Representative shall seek to negotiate an 
agreement that provides for the elimination of the practices 
that are the subject of the investigation as quickly as 
possible or, if elimination of the practices is not feasible, 
an agreement that provides for compensatory trade benefits.
    (d) Reports.--The Trade Representative shall include in the 
semiannual report required by section 309 a report on the 
status of any investigations initiated pursuant to subsection 
(b) and, where appropriate, the extent to which such 
investigations have led to increased opportunities for the 
export of products and services of the United States.

  Sections 281 and 282 of the Uruguay Round Agreements Act, as amended


    [19 U.S.C. 3571, 3572; P.L. 103-465, as amended by P.L. 104-295]

SEC. 281. SUBSIDIES ENFORCEMENT.

  (a) Assistance Regarding Multilateral Subsidy Remedies.--The 
administering authority shall provide information to the public 
upon request, and, to the extent feasible, assistance and 
advice to interested parties concerning--
          (1) remedies and benefits available under relevant 
        provisions of the Subsidies Agreement, and
          (2) the procedures relating to such remedies and 
        benefits.
    (b) Prohibited Subsidies.--
          (1) Notification of trade representative.--If the 
        administering authority determines pursuant to title 
        VII of the Tariff Act of 1930 that a class or kind of 
        merchandise is benefiting from a subsidy which is 
        prohibited under Article 3 of the Subsidies Agreement, 
        the administering authority shall notify the Trade 
        Representative and shall provide the Trade 
        Representative with the information upon which the 
        administering authority based its determination.
          (2) Request by interested party regarding prohibited 
        subsidy.--An interested party may request that the 
        administering authority determine if there is reason to 
        believe that merchandise produced in a WTO member 
        country is benefiting from a subsidy which is 
        prohibited under Article 3 of the Subsidies Agreement. 
        The request shall contain such information as the 
        administering authority may require to support the 
        allegations contained in the request. If the 
        administering authority, after analyzing the request 
        and other information reasonably available to the 
        administering authority, determines that there is 
        reason to believe that such merchandise is benefiting 
        from a subsidy which is prohibited under Article 3 of 
        the Subsidies Agreement, the administering authority 
        shall so notify the Trade Representative, and shall 
        include supporting information with the notification.
    (c) Subsidies Actionable Under the Agreement.--
          (1) In general.--If the administering authority 
        determines pursuant to title VII of the Tariff Act of 
        1930 that a class or kind of merchandise is benefiting 
        from a subsidy described in Article 6.1 of the 
        Subsidies Agreement,\19\ the administering authority 
        shall notify the Trade Representative, and shall 
        provide the Trade Representative with the information 
        upon which the administering authority based its 
        determination.
---------------------------------------------------------------------------
    \19\ Article 6.1 of the Uruguay Round Subsides Agreement lapsed on 
January 1, 2000.
---------------------------------------------------------------------------
          (2) Request by interested party regarding adverse 
        effects.--An interested party may request the 
        administering authority to determine if there is reason 
        to believe that a subsidy which is actionable under the 
        Subsidies Agreement is causing adverse effects. The 
        request shall contain such information as the 
        administering authority may require to support the 
        allegations contained in the request. At the request of 
        the administering authority, the Commission shall 
        assist the administering authority in analyzing the 
        information pertaining to the existence of such adverse 
        effects. If the administering authority, after 
        analyzing the request and other information reasonably 
        available to the administering authority, determines 
        that there is reason to believe that a subsidy which is 
        actionable under the Subsidies Agreement is causing 
        adverse effects, the administering authority shall so 
        notify the Trade Representative, and shall include 
        supporting information with the notification.
    (d) Initiation of Section 301 Investigation.--On the basis 
of the notification and information provided by the 
administering authority pursuant to subsection (b) or (c), such 
other information as the Trade Representative may have or 
obtain, and where applicable, after consultation with an 
interested party referred to in subsection (b)(2) or (c)(2), 
the Trade Representative shall, unless such interested party 
objects, determine as expeditiously as possible, in accordance 
with the procedures in section 302(b)(1) of the Trade Act of 
1974 (19 U.S.C. 2412(b)(1)), whether to initiate an 
investigation pursuant to title III of that Act (19 U.S.C. 2411 
et seq.). At the request of the Trade Representative, the 
administering authority and the Commission shall assist the 
Trade Representative in an investigation initiated pursuant to 
this subsection.
    (e) Nonactionable Subsidies.--
          (1) Compliance with article 8 of the subsidies 
        agreement.--\20\
---------------------------------------------------------------------------
    \20\ Article 8 of the Uruguay Round Subsidies Agreement lapsed on 
January 1, 2000.
---------------------------------------------------------------------------
                  (A) Monitoring.--In order to monitor whether 
                a subsidy meets the conditions and criteria 
                described in Article 8.2 of the Subsidies 
                Agreement and is nonactionable, the Trade 
                Representative shall provide the administering 
                authority on a timely basis with any 
                information submitted or report made pursuant 
                to Article 8.3 or 8.4 of the Subsidies 
                Agreement regarding a notified subsidy program. 
                The administering authority shall review such 
                information and reports, and where appropriate, 
                shall recommend to the Trade Representative 
                that the Trade Representative seek pursuant to 
                Article 8.3 or 8.4 of the Subsidies Agreement 
                additional information regarding the notified 
                subsidy program or a subsidy granted pursuant 
                to the notified subsidy program. If the 
                administering authority has reason to believe 
                that a violation of Article 8 of the Subsidies 
                Agreement exists, the administering authority 
                shall so notify the Trade Representative, and 
                shall include supporting information with the 
                notification.
                  (B) Request by interested party regarding 
                violation of article 8.--An interested party 
                may request the administering authority to 
                determine if there is reason to believe that a 
                violation of Article 8 of the Subsidies 
                Agreement exists. The request shall contain 
                such information as the administering authority 
                may require to support the allegations 
                contained in the request. If the administering 
                authority, after analyzing the request and 
                other information reasonably available to the 
                administering authority, determines that 
                additional information is needed, the 
                administering authority shall recommend to the 
                Trade Representative that the Trade 
                Representative seek, pursuant to Article 8.3 or 
                8.4 of the Subsidies Agreement, additional 
                information regarding the particular notified 
                subsidy program or a subsidy granted pursuant 
                to the notified subsidy program. If the 
                administering authority determines that there 
                is reason to believe that a violation of 
                Article 8 of the Subsidies Agreement exists, 
                the administering authority shall so notify the 
                Trade Representative, and shall include 
                supporting information with the notification.
                  (C) Action by trade representative.--
                          (i) If the Trade Representative, on 
                        the basis of the notification and 
                        information provided by the 
                        administering authority pursuant to 
                        subparagraph (A) or (B), and such other 
                        information as the Trade Representative 
                        may have or obtain, and after 
                        consulting with the interested party 
                        referred to in subparagraph (B) and 
                        appropriate domestic industries, 
                        determines that there is reason to 
                        believe that a violation of Article 8 
                        of the Subsidies Agreement exists, the 
                        Trade Representative shall invoke the 
                        procedures of Article 8.4 or 8.5 of the 
                        Subsidies Agreement.
                          (ii) For purposes of clause (i), the 
                        Trade Representative shall determine 
                        that there is reason to believe that a 
                        violation of Article 8 exists in any 
                        case in which the Trade Representative 
                        determines that a notified subsidy 
                        program or a subsidy granted pursuant 
                        to a notified subsidy program does not 
                        satisfy the conditions and criteria 
                        required for a nonactionable subsidy 
                        program under this Act, the Subsidies 
                        Agreement, and the statement of 
                        administrative action approved under 
                        section 101(a).
                  (D) Notification of administering 
                authority.--The Trade Representative shall 
                notify the administering authority whenever a 
                violation of Article 8 of the Subsidies 
                Agreement has been found to exist pursuant to 
                Article 8.4 or 8.5 of that Agreement.
          (2) Serious adverse effects.--
                  (A) Request by interested party.--An 
                interested party may request the administering 
                authority to determine if there is reason to 
                believe that serious adverse effects resulting 
                from a program referred to in Article 8.2 of 
                the Subsidies Agreement exist. The request 
                shall contain such information as the 
                administering authority may require to support 
                the allegations contained in the request.
                  (B) Action by administering authority.--
                Within 90 days after receipt of the request 
                described in subparagraph (A), the 
                administering authority, after analyzing the 
                request and other information reasonably 
                available to the administering authority, shall 
                determine if there is reason to believe that 
                serious adverse effects resulting from a 
                program referred to in Article 8.2 of the 
                Subsidies Agreement exist. If the determination 
                of the administering authority is affirmative, 
                it shall so notify the Trade Representative and 
                shall include supporting information with the 
                notification. The Commission shall assist the 
                administering authority in analyzing the 
                information pertaining to the existence of such 
                serious adverse effects if the administering 
                authority requests the Commission's assistance. 
                If the subsidy program that is alleged to 
                result in serious adverse effects has been the 
                subject of a countervailing duty investigation 
                or review under subtitle A or C of title VII of 
                the Tariff Act of 1930, the administering 
                authority shall take into account the 
                determinations made by the administering 
                authority and the Commission in such 
                investigation or review and the administering 
                authority shall complete its analysis as 
                expeditiously as possible.
                  (C) Action by trade representative.--The 
                Trade Representative, on the basis of the 
                notification and information provided by the 
                administering authority pursuant to 
                subparagraph (B), and such other information as 
                the Trade Representative may have or obtain, 
                shall determine as expeditiously as possible, 
                but not later than 30 days after receipt of the 
                notification provided by the administering 
                authority, if there is reason to believe that 
                serious adverse effects exist resulting from 
                the subsidy program which is the subject of the 
                administering authority's notification. The 
                Trade Representative shall make an affirmative 
                determination regarding the existence of such 
                serious adverse effects unless the Trade 
                Representative finds that the notification of 
                the administering authority is not supported by 
                the facts.
                  (D) Consultations.--If the Trade 
                Representative determines that there is reason 
                to believe that serious adverse effects 
                resulting from the subsidy program exist, the 
                Trade Representative, unless the interested 
                party referred to in subparagraph (A) objects, 
                shall invoke the procedures of Article 9 of the 
                Subsidies Agreement, and shall request 
                consultations pursuant to Article 9.2 of the 
                Subsidies Agreement with respect to such 
                serious adverse effects. If such consultations 
                have not resulted in a mutually acceptable 
                solution within 60 days after the request is 
                made for such consultations, the Trade 
                Representative shall refer the matter to the 
                Subsidies Committee pursuant to Article 9.3 of 
                the Subsidies Agreement.
                  (E) Determination by subsidies committee.--If 
                the Trade Representative determines that--
                          (i) the Subsidies Committee has been 
                        prevented from making an affirmative 
                        determination regarding the existence 
                        of serious adverse effects under 
                        Article 9 of the Subsidies Agreement by 
                        reason of the refusal of the WTO member 
                        country with respect to which the 
                        consultations have been invoked to join 
                        in an affirmative consensus--
                                  (I) that such serious adverse 
                                effects exist, or
                                  (II) regarding a 
                                recommendation to such WTO 
                                member country to modify the 
                                subsidy program in such a way 
                                as to remove the serious 
                                adverse effects, or
                          (ii) the Subsidies Committee has not 
                        presented its conclusions regarding the 
                        existence of such serious adverse 
                        effects within 120 days after the date 
                        the matter was referred to it, as 
                        required by Article 9.4 of the 
                        Subsidies Agreement,
        the Trade Representative shall, within 30 days after 
        such determination, make a determination under section 
        304(a)(1) of the Trade Act of 1974 (19 U.S.C. 
        2414(a)(1)) regarding what action to take under section 
        301(a)(1)(A) of that Act.
                  (F) Noncompliance with committee 
                recommendation.--In the event that the 
                Subsidies Committee makes a recommendation 
                under Article 9.4 of the Subsidies Agreement 
                and the WTO member country with respect to 
                which such recommendation is made does not 
                comply with such recommendation within 6 months 
                after the date of the recommendation, the Trade 
                Representative shall make a determination under 
                section 304(a)(1) of the Trade Act of 1974 (19 
                U.S.C. 2414(a)(1)) regarding what action to 
                take under section 301(a) of that Act.
    (f) Notification, Consultation, and Publication.--\21\
---------------------------------------------------------------------------
    \21\ Paragraphs (1), (2), and (3) of subsection (f) refer to 
Article 8 of the Uruguary Round Subsidies Agreement, which lapsed on 
January 1, 2000.
---------------------------------------------------------------------------
          (1) Notification of congress.--The Trade 
        Representative shall submit promptly to the Committee 
        on Ways and Means of the House of Representatives, the 
        Committee on Finance of the Senate, and other 
        appropriate committees of the Congress any information 
        submitted or report made pursuant to Article 8.3 or 8.4 
        of the Subsidies Agreement regarding a notified subsidy 
        program.
          (2) Publication in the federal register.--The 
        administering authority shall publish regularly in the 
        Federal Register a summary notice of any information 
        submitted or report made pursuant to Article 8.3 or 8.4 
        of the Subsidies Agreement regarding notified subsidy 
        programs.
          (3) Consultations with congress and private sector.--
        The Trade Representative and the administering 
        authority promptly shall consult with the committees 
        referred to in paragraph (1), and with interested 
        representatives of the private sector, regarding all 
        information submitted or reports made pursuant to 
        Article 8.3 or 8.4 of the Subsidies Agreement regarding 
        a notified subsidy program.
          (4) Annual report.--Not later than February 1 of each 
        year beginning in 1996, the Trade Representative and 
        the administering authority shall issue a joint report 
        to the Congress detailing--
                  (A) the subsidies practices of major trading 
                partners of the United States, including 
                subsidies that are prohibited, are causing 
                serious prejudice, or are nonactionable, under 
                the Subsidies Agreement, and
                  (B) the monitoring and enforcement activities 
                of the Trade Representative and the 
                administering authority during the preceding 
                calendar year which relate to subsidies 
                practices.
    (g) Cooperation of Other Agencies.--All agencies, 
departments, and independent agencies of the Federal Government 
shall cooperate fully with one another in carrying out the 
provisions of this section, and, upon the request of the 
administering authority, shall furnish to the administering 
authority all records, papers, and information in their 
possession which relate to the requirements of this section.
  (h) Definitions.--For purposes of this section--\22\
---------------------------------------------------------------------------
    \22\ Paragraphs (5), (6), (7), and (12) refer to Article 8 of the 
Uruguary Round Subsidies Agreement, which lapsed an January 1, 2000.
---------------------------------------------------------------------------
          (1) Adverse effects.--The term ``adverse effects'' 
        has the meaning given that term in Articles 5(a) and 
        5(c) of the Subsidies Agreement.
          (2) Administering authority.--The term 
        ``administering authority'' has the meaning given that 
        term in section 771(1) of the Tariff Act of 1930 (19 
        U.S.C. 1677(1)).
          (3) Commission.--The term ``Commission'' means the 
        United States International Trade Commission.
          (4) Interested party.--The term ``interested party'' 
        means a party described in subparagraph (C), (D), (E), 
        (F), or (G) of section 771(9) of the Tariff Act of 1930 
        (19 U.S.C. 1677(9) (C), (D), (E), (F), or (G)).
          (5) Nonactionable subsidy.--The term ``nonactionable 
        subsidy'' means a subsidy described in Article 8.1(b) 
        of the Subsidies Agreement.
          (6) Notified subsidy program.--The term ``notified 
        subsidy program'' means a subsidy program which has 
        been notified pursuant to Article 8.3 of the Subsidies 
        Agreement.
          (7) Serious adverse effects.--The term ``serious 
        adverse effects'' has the meaning given that term in 
        Article 9.1 of the Subsidies Agreement.
          (8) Subsidies agreement.--The term ``Subsidies 
        Agreement'' means the Agreement on Subsidies and 
        Countervailing Measures described in section 771(8) of 
        the Tariff Act of 1930 (19 U.S.C. 1677(8)).
          (9) Subsidies committee.--The term ``Subsidies 
        Committee'' means the committee established pursuant to 
        Article 24 of the Subsidies Agreement.
          (10) Subsidy.--The term ``subsidy'' has the meaning 
        given that term in Article 1 of the Subsidies 
        Agreement.
          (11) Trade representative.--The term ``Trade 
        Representative'' means the United States Trade 
        Representative.
          (12) Violation of article 8.--The term ``violation of 
        Article 8'' means the failure of a notified subsidy 
        program or an individual subsidy granted pursuant to a 
        notified subsidy program to meet the applicable 
        conditions and criteria described in Article 8.2 of the 
        Subsidies Agreement.
  (i) Treatment of Proprietary Information.--Notwithstanding 
any other provision of law, the administering authority may 
provide the Trade Representative with a copy of proprietary 
information submitted to, or obtained by, the administering 
authority that the Trade Representative considers relevant in 
carrying out its responsibilities under this part. The Trade 
Representative shall protect from public disclosure proprietary 
information obtained from the administering authority under 
this part.

SEC. 282. REVIEW OF SUBSIDIES AGREEMENT.

  (a) General Objectives.--The general objectives of the United 
States under this part are--
          (1) to ensure that parts II and III of the Agreement 
        on Subsidies and Countervailing Measures referred to in 
        section 101(d)(12) (hereafter in this section referred 
        to as the ``Subsidies Agreement'') are effective in 
        disciplining the use of subsidies and in remedying the 
        adverse effects of subsidies, and
          (2) to ensure that part IV of the Subsidies Agreement 
        does not undermine the benefits derived from any other 
        part of that Agreement.
  (b) Specific Objective.--The specific objective of the United 
States under this part shall be to create a mechanism which 
will provide for an ongoing review of the operation of part IV 
of the Subsidies Agreement.
  (c) Sunset of Noncountervailable Subsidies Provisions.--
          (1) In general.--Subparagraphs (B), (C), (D), and (E) 
        of section 771(5B) of the Tariff Act of 1930 shall 
        cease to apply as provided in subparagraph (G)(i) of 
        such section, unless, before the date referred to in 
        such subparagraph (G)(i)--
                  (A) the Subsidies Committee determines to 
                extend Articles 6.1, 8, and 9 of the Subsidies 
                Agreement as in effect on the date on which the 
                Subsidies Agreement enters into force or in a 
                modified form, in accordance with Article 31 of 
                such Agreement,
                  (B) the President consults with the Congress 
                in accordance with paragraph (2), and
                  (C) an implementing bill is submitted and 
                enacted into law in accordance with paragraphs 
                (3) and (4).
          (2) Consultation with congress before subsidies 
        committee agrees to extend.--Before a determination is 
        made by the Subsidies Committee to extend Articles 6.1, 
        8, and 9 of the Subsidies Agreement, the President 
        shall consult with the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate regarding such extension.
          (3) Implementation of extension.--
                  (A) Notification and submission.--Any 
                extension of subparagraphs (B), (C), (D), and 
                (E) of section 771(5B) of the Tariff Act of 
                1930 shall take effect if (and only if)--
                          (i) after the Subsidies Committee 
                        determines to extend Articles 6.1, 8, 
                        and 9 of the Subsidies Agreement, the 
                        President submits to the committees 
                        referred to in paragraph (2) a copy of 
                        the document describing the terms of 
                        such extension, together with--
                                  (I) a draft of an 
                                implementing bill,
                                  (II) a statement of any 
                                administrative action proposed 
                                to implement the extension, and
                                  (III) the supporting 
                                information described in 
                                subparagraph (C); and
                          (ii) the implementing bill is enacted 
                        into law.
                  (B) Implementing bill.--The implementing bill 
                referred to in subparagraph (A) shall contain 
                only those provisions that are necessary or 
                appropriate to implement an extension of the 
                provisions of section 771(5B) (B), (C), (D), 
                and (E) of the Tariff Act of 1930 as in effect 
                on the day before the date of the enactment of 
                the implementing bill or as modified to reflect 
                the determination of the Subsidies Committee to 
                extend Articles 6.1, 8, and 9 of the Subsidies 
                Agreement.
                  (C) Supporting information.--The supporting 
                information required under subparagraph 
                (A)(i)(III) consists of--
                          (i) an explanation as to how the 
                        implementing bill and proposed 
                        administrative action will change or 
                        affect existing law; and
                          (ii) a statement regarding--
                                  (I) how the extension serves 
                                the interests of United States 
                                commerce, and
                                  (II) why the implementing 
                                bill and proposed 
                                administrative action is 
                                required or appropriate to 
                                carry out the extension.
          [(4) Application of congressional ``fast track'' 
        procedures to implementing bill.--Amendments to section 
        151 of the Trade Act of 1974.]
          (5) Report by the trade representative.--Not later 
        than the date referred to in section 771(5B)(G)(i) of 
        the Tariff Act of 1930, the Trade Representative shall 
        submit to the Congress a report setting forth the 
        provisions of law which were enacted to implement 
        Articles 6.1, 8, and 9 of the Subsidies Agreement and 
        should be repealed or modified if such provisions are 
        not extended.
  (d) Review of the Operation of the Subsidies Agreement.--The 
Secretary of Commerce, in consultation with other appropriate 
departments and agencies of the Federal Government, shall 
undertake an ongoing review of the operation of the Subsidies 
Agreement. The review shall address--
          (1) the effectiveness of part II of the Subsidies 
        Agreement in disciplining the use of subsidies which 
        are prohibited under Article 3 of the Agreement,
          (2) the effectiveness of part III and, in particular, 
        Article 6.1 of the Subsidies Agreement, in remedying 
        the adverse effects of subsidies which are actionable 
        under the Agreement, and
          (3) the extent to which the provisions of part IV of 
        the Subsidies Agreement may have undermined the 
        benefits derived from other parts of the Agreement, 
        and, in particular--
                  (A) the extent to which WTO member countries 
                have cooperated in reviewing and improving the 
                operation of part IV of the Subsidies 
                Agreement,
                  (B) the extent to which the provisions of 
                Articles 8.4 and 8.5 of the Subsidies Agreement 
                have been effective in identifying and 
                remedying violations of the conditions and 
                criteria described in Article 8.2 of the 
                Agreement, and
                  (C) the extent to which the provisions of 
                Article 9 of the Subsidies Agreement have been 
                effective in remedying the serious adverse 
                effects of subsidy programs described in 
                Article 8.2 of the Agreement.
Not later than 4 years and 6 months after the date of the 
enactment of this Act, the Secretary of Commerce shall submit 
to the Congress a report on the review required under this 
subsection.

           Section 307(b) of the Trade and Tariff Act of 1984


            [19 U.S.C. 2114d; P.L. 98-573, and P.L. 99-514]

SEC. 307. NEGOTIATING AUTHORITY WITH RESPECT TO FOREIGN DIRECT 
                    INVESTMENT.

           *       *       *       *       *       *       *


    (b)(1) If the United States Trade Representative, with the 
advice of the committee established by section 242 of the Trade 
Expansion [Act] of 1962 (19 U.S.C. 1872), determines that 
action by the United States is appropriate to respond to any 
export performance requirements of any foreign country or 
instrumentality that adversely affect the economic interests of 
the United States, then the United States Trade Representative 
shall seek to obtain the reduction and elimination of such 
export performance requirements through consultations and 
negotiations with the foreign country or instrumentality 
concerned.
    (2) In addition to the action referred to in paragraph (1), 
the United States Trade Representative may impose duties or 
other import restrictions on the products or services of such 
foreign country or instrumentality for such time as he 
determines appropriate, including the exclusion from entry into 
the United States of products subject to such requirements.
    (3) Nothing in paragraph (2) shall apply to any products or 
services with respect to which--
          (A) any foreign direct investment (including a 
        purchase of land or facilities) has been made directly 
        or indirectly by any United States person before the 
        date of enactment of this Act, or
          (B) any written commitment relating to a foreign 
        direct investment that is binding on the date of 
        enactment of this Act has been made directly or 
        indirectly by any United States person.
    (4) Whenever the international obligations of the United 
States and actions taken under paragraph (2) make compensation 
necessary or appropriate, compensation may be provided by the 
United States Trade Representative subject to the limitations 
and conditions contained in section 123 of the Trade Act of 
1974 (19 U.S.C. 2133) for providing compensation for actions 
taken under section 203 of that Act.

    Foreign Air Transportation: Section 2 of the International Air 
 Transportation Fair Competitiveness Act of 1974, as amended, and the 
                Federal Aviation Act of 1958, as amended


 [49 U.S.C. 41310 (previously codified as 49 App. U.S.C. 1159b); P.L. 
         85-726, P.L. 103-272, P.L. 104-287, and P.L. 106-181]

SEC. 41310. DISCRIMINATORY PRACTICES.

    (a) Prohibition.--An air carrier or foreign air carrier may 
not subject a person, place, port, or type of traffic in 
foreign air transportation to unreasonable discrimination.
    (b) Review and Negotiation of Discriminatory Foreign 
Charges.--(1) The Secretary of Transportation shall survey 
charges imposed on an air carrier by the government of a 
foreign country or another foreign entity for the use of 
airport property or airway property in foreign air 
transportation. If the Secretary of Transportation decides that 
a charge is discriminatory, the Secretary promptly shall report 
the decision to the Secretary of State. The Secretaries of 
State and Transportation promptly shall begin negotiations with 
the appropriate government to end the discrimination. If the 
discrimination is not ended in a reasonable time through 
negotiation, the Secretary of Transportation shall establish a 
compensating charge equal to the discriminatory charge. With 
the approval of the Secretary of State, the Secretary of the 
Treasury shall impose the compensating charge on a foreign air 
carrier of that country as a condition to accepting the general 
declaration of the aircraft of the foreign air carrier when it 
lands or takes off.
    (2) The Secretary of the Treasury shall maintain an account 
to credit money collected under paragraph (1) of this 
subsection. An air carrier shall be paid from the account an 
amount certified by the Secretary of Transportation to 
compensate the air carrier for the discriminatory charge paid 
to the government.
    (c) Actions Against Discriminatory Activity.--(1) The 
Secretary of Transportation may take actions the Secretary 
considers are in the public interest to eliminate an activity 
of a government of a foreign country or another foreign entity, 
including a foreign air carrier, when the Secretary, on the 
initiative of the Secretary or on complaint, decides that the 
activity--
          (A) is an unjustifiable or unreasonable 
        discriminatory, predatory, or anticompetitive practice 
        against an air carrier; or
          (B) imposes an unjustifiable or unreasonable 
        restriction on access of an air carrier to a foreign 
        market.
    (2) The Secretary of Transportation may deny, amend, 
modify, suspend, revoke, or transfer under paragraph (1) of 
this subsection a foreign air carrier permit or tariff under 
section 41302, 41303, 41304(a), 41504(c), 41507, or 41509 of 
this title [Sections 402, 403, 801, and 1002 of the Federal 
Aviation Act of 1958, as amended].
    (d) Filing of, and Acting on, Complaints.--(1) An air 
carrier computer reservations system firm, or a department, 
agency, or instrumentality of the United States Government may 
file a complaint under subsection (c) or (g) of this section 
with the Secretary of Transportation. The Secretary shall 
approve, deny, or dismiss the complaint, set the complaint for 
a hearing or investigation, or begin another proceeding 
proposing remedial action not later than 60 days after 
receiving the complaint. The Secretary may extend the period 
for acting for additional periods totaling not more than 30 
days if the Secretary decides that with additional time it is 
likely that a complaint can be resolved satisfactorily through 
negotiations with the government of the foreign country or 
foreign entity. The Secretary must act not later than 90 days 
after receiving the complaint. However, the Secretary may 
extend this 90-day period for not more than an additional 90 
days if, on the last day of the initial 90-day period, the 
Secretary finds that--
          (A) negotiations with the government have progressed 
        to a point that a satisfactory resolution of the 
        complaint appears imminent;
          (B) an air carrier has not been subjected to economic 
        injury by the government or entity as a result of 
        filing the complaint; and
          (C) the public interest requires additional time 
        before the Secretary acts on the complaint.
    (2) In carrying out paragraph (1) of this subsection and 
subsection (c) of this section, the Secretary of Transportation 
shall--
          (A) solicit the views of the Secretaries of Commerce 
        and State and the United States Trade Representative;
          (B) give an affected air carrier or foreign air 
        carrier reasonable notice and an opportunity to submit 
        written evidence and arguments within the time limits 
        of this subsection; and
          (C) submit to the President under section 41307 or 
        41509(f) of this title [Section 801 of the Federal 
        Aviation Act of 1958, as amended] actions proposed by 
        the Secretary of Transportation.
    (e) Review.--(1) the Secretaries of State, the Treasury, 
and Transportation and the heads of other departments, 
agencies, and instrumentalities of the Government shall keep 
under review, to the extent of each of their jurisdictions, 
each form of discrimination or unfair competitive practice to 
which an air carrier is subject when providing foreign air 
transportation or a computer reservations system firm is 
subject when providing service with respect to airline service. 
Each Secretary and head shall--
          (A) take appropriate action to eliminate any 
        discrimination or unfair competitive practice found to 
        exist; and
          (B) request Congress to enact legislation when the 
        authority to eliminate the discrimination or unfair 
        practice is inadequate.
    (2) The Secretary of Transportation shall report to 
Congress annually on each action taken under paragraph (1) of 
this subsection and on the continuing program to eliminate 
discrimination and unfair competitive practices. The 
Secretaries of State and the Treasury each shall give the 
Secretary of Transportation information necessary to prepare 
the report.
    (f) Reports.--Not later than 30 days after acting on a 
complaint under this section, the Secretary of Transportation 
shall report to the Committee on Transportation and 
Infrastructure of the House of Representatives and the 
Committee on Commerce, Science, and Transportation of the 
Senate on action taken under this section on the complaint.
    (g) Actions against discriminatory activity by foreign CRS 
systems.--The Secretary of Transportation may take such actions 
as the Secretary considers are in the public interest to 
eliminate an activity of a foreign air carrier that owns or 
markets a computer reservations system, or of a computer 
reservations system firm whose principal offices are located 
outside the United States, when the Secretary, on the 
initiative of the Secretary or on complaint, decides that the 
activity, with respect to airline service--
      (1) is an unjustifiable or unreasonable discriminatory, 
predatory, or anticompetitive practice against a computer 
reservations system firm whose principal offices are located 
outside the United States, when the Secretary, on the 
initiative of the Secretary or on complaint, decides that the 
activity, with respect to airline service--
      (2) imposes an unjustifiable or unreasonable restriction 
on access of such a computer reservations system to a foreign 
market.

       Section 19 of the Merchant Marine Act of 1920, as amended


[46 App. U.S.C. 876; Act June 5, 1920, as amended by Act June 29, 1936, 
Reorganization Plan No. 21 of 1950, Reorganization Plan No. 7 of 1961; 
       P.L. 97-31; P.L. 101-595, P.L. 102-587, and P.L. 105-258]

    Sec. 19. (a) The Secretary of Transportation is authorized 
and directed in aid of the accomplishment of the purposes of 
this Act--
          (1) To make all necessary rules and regulations to 
        carry out the provisions of this Act;
          And the Federal Maritime Commission is authorized and 
        directed in aid of the accomplishment of the purposes 
        of this Act:
          (2) To make rules and regulations affecting shipping 
        in the foreign trade not in conflict with law in order 
        to adjust or meet general or special conditions 
        unfavorable to shipping in the foreign trade, whether 
        in any particular trade or upon any particular route or 
        in commerce generally, including intermodal movements, 
        terminal operations, cargo solicitation, agency 
        services, ocean transportation intermediary services 
        and operations, and other activities and services 
        integral to transportation systems, and which arise out 
        of or result from foreign laws, rules, or regulations 
        or from competitive methods, pricing practices, or 
        other practices employed by owners, operators, agents, 
        or masters of vessels of a foreign country; and
          (3) To request the head of any department, board, 
        bureau, or agency of the Government to suspend, modify, 
        or annul rules or regulations which have been 
        established by such department, board, bureau, or 
        agency, or to make new rules or regulations affecting 
        shipping in the foreign trade other than such rules or 
        regulations relating to the Public Health Service, the 
        Consular Service, and the Steamboat Inspection Service.
    (b) No rule or regulation shall be established by any 
department, board, bureau, or agency of the Government which 
affects shipping in the foreign trade, except rules or 
regulations affecting the Public Health Service, the Consular 
Service, and the Steamboat Inspection Service, until such rule 
or regulation has been submitted to the board [Federal Maritime 
Commission] for its approval and final action has been taken 
thereon by the board or the President.
    (c) Whenever the head of any department, board, bureau, or 
agency of the Government refuses to suspend, modify, or annul 
any rule or regulation, or make a new rule or regulation upon 
request of the board [Federal Maritime Commission], as provided 
in subsection (a)(3) of this section, or objects to the 
decision of the board in respect to the approval of any rule or 
regulation, as provided in subsection (b) of this section, 
either the board or the head of the department, board, bureau, 
or agency which has established or is attempting to establish 
the rule or regulation in question may submit the facts to the 
President, who is hereby authorized to establish or suspend, 
modify, or annul such rule or regulation.
    (d) No rule or regulation shall be established which in any 
manner gives vessels owned by the United States any preference 
or favor over those vessels documented under the laws of the 
United States and owned by persons who are citizens of the 
United States.
    (e) The Commission may initiate a rule or regulation under 
subsection (a)(2) of this section either on its own motion or 
pursuant to a petition. Any person, including a common carrier, 
tramp operator, bulk operator, shipper, shippers' association, 
ocean transportation intermediary, marine terminal operator, or 
any component of the Government of the United States, may file 
a petition for relief under subsection (a)(2) of this section.
    (f) In furtherance of the purposes of subsection (a)(2) of 
this section--
          (1) the Commission may, by order, require any person 
        (including any common carrier, tramp operator, bulk 
        operator, shipper, shippers' association, ocean 
        transportation intermediary or marine terminal 
        operator, or an officer, receiver, trustee, lessee, 
        agent, or employee thereof) to file with the Commission 
        a report, answers to questions, documentary material, 
        or other information which the Commission considers 
        necessary or appropriate;
          (2) the Commission may require a report or answers to 
        questions to be made under oath;
          (3) the Commission may prescribe the form and the 
        time for response to a report and answers to questions; 
        and
          (4) a person who fails to file a report, answer, 
        documentary material, or other information required 
        under this paragraph shall be liable to the United 
        States Government for a civil penalty of not more than 
        $5,000 for each day that the information is not 
        provided.
    (g) In proceedings under subsection (a)(2) of this 
section--
          (1) the Commission may authorize a party to use 
        depositions, written interrogatories, and discovery 
        procedures that, to the extent practicable, are in 
        conformity with the rules applicable in civil 
        proceedings in the district courts of the United 
        States;
          (2) the Commission may by subpoena compel the 
        attendance of witnesses and the production of books, 
        papers, documents, and other evidence;
          (3) subject to funds being provided by appropriations 
        Acts, witnesses are, unless otherwise prohibited by 
        law, entitled to the same fees and mileage as in the 
        courts of the United States;
          (4) for failure to supply information ordered to be 
        produced or compelled by subpoena under paragraph (2) 
        of this section, the Commission may--
                  (A) after notice and an opportunity for 
                hearing, suspend tariffs and service contracts 
                of a common carrier or that common carrier's 
                right to use tariffs of conferences and service 
                contracts of agreements of which it is a 
                member, or
                  (B) assess a civil penalty of not more than 
                $5,000 for each day that the information is not 
                provided; and
          (5) when a person violates an order of the Commission 
        or fails to comply with a subpoena, the Commission may 
        seek enforcement by a United States district court 
        having jurisdiction over the parties, and if, after 
        hearing, the court determines that the order was 
        regularly made and duly issued, it shall enforce the 
        order by an appropriate injunction or other process, 
        mandatory or otherwise.
    (h) Notwithstanding any other law, the Commission may 
refuse to disclose to the public a response or other 
information provided under the terms of this section.
    (i) If the Commission finds that conditions that are 
unfavorable to shipping under subsection (a)(2) of this section 
exist, the Commission may--
          (1) limit sailings to and from United States ports or 
        the amount or type of cargo carried;
          (2) suspend, in whole or in part, tariffs and service 
        contracts for carriage to or from United States ports, 
        including a common carrier's right to use tariffs of 
        conferences and service contracts of agreements in 
        United States trades of which it is a member for any 
        period the Commission specifies;
          (3) suspend, in whole or in part, an ocean common 
        carrier's right to operate under an agreement filed 
        with the Commission, including any agreement 
        authorizing preferential treatment at terminals, 
        preferential terminal leases, space chartering, or 
        pooling of cargoes or revenue with other ocean common 
        carriers;
          (4) impose a fee, not to exceed $1,000,000 per 
        voyage; or
          (5) take any other action the Commission finds 
        necessary and appropriate to adjust or meet any 
        condition unfavorable to shipping in the foreign trade 
        of the United States.
    (j) Upon request by the Commission--
          (1) the collector of customs at the port or place of 
        destination in the United States shall refuse the 
        clearance required by section 4197 of the Revised 
        Statutes (46 App. U.S.C. 91) to a vessel of a country 
        that is named in a rule or regulation issued by the 
        Commission under subsection (a)(2) of this section, and 
        shall collect any fees imposed by the Commission under 
        subsection (i)(4) of this section; and
          (2) the Secretary of the department in which the 
        Coast Guard is operating shall deny entry for purpose 
        of oceanborne trade, of a vessel of a country that is 
        named in a rule or regulation issued by the Commission 
        under subsection (a)(2) of this section, to any port or 
        place in the United States or the navigable waters of 
        the United States, or shall detain that vessel at the 
        port or place in the United States from which it is 
        about to depart for another port or place in the United 
        States.
    (k) A common carrier that accepts or handles cargo for 
carriage under a tariff or service contract that has been 
suspended under subsection (g)(4) or (i)(2) of this section, or 
after its right to use another tariff or service contract has 
been suspended under those paragraphs, is subject to a civil 
penalty of not more than $50,000 for each day that it is found 
to be operating under a suspended tariff or service contract.
    (l) The Commission may consult with, seek the cooperation 
of, or make recommendations to other appropriate Government 
agencies prior to taking any action under this section.

      Section 10002 of the Foreign Shipping Practices Act of 1988


         [46 App. U.S.C. 1710a; P.L. 100-418, and P.L. 105-258]

SEC. 10002. FOREIGN LAWS AND PRACTICES.

    (a) Definitions.--For purposes of this section--
          (1) ``common carrier'', ``marine terminal operator'', 
        ``ocean transportation intermediary'', ``ocean common 
        carrier'', ``person'', ``shipper'', ``shippers' 
        association'', and ``United States'' have the meanings 
        given each such term, respectively, in section 3 of the 
        Shipping Act of 1984 (46 App. U.S.C. 1702);
          (2) ``foreign carrier'' means an ocean common carrier 
        a majority of whose vessels are documented under the 
        laws of a country other than the United States;
          (3) ``maritime services'' means port-to-port carriage 
        of cargo by the vessels operated by ocean common 
        carriers;
          (4) ``maritime-related services'' means intermodal 
        operations, terminal operations, cargo solicitation, 
        agency services, ocean transportation intermediary 
        services and operations, and all other activities and 
        services integral to total transportation systems of 
        ocean common carriers and their foreign domiciled 
        affiliates on their own and others' behalf;
          (5) ``United States carrier'' means an ocean common 
        carrier which operates vessels documented under the 
        laws of the United States; and
          (6) ``United States oceanborne trade'' means the 
        carriage of cargo between the United States and a 
        foreign country, whether direct or indirect, by an 
        ocean common carrier.
    (b) Authority To Conduct Investigations.--The Federal 
Maritime Commission shall investigate whether any laws, rules, 
regulations, policies, or practices of foreign governments, or 
any practices of foreign carriers or other persons providing 
maritime or maritime-related services in a foreign country 
result in the existence of conditions that--
          (1) adversely affect the operations of United States 
        carriers in United States oceanborne trade; and
          (2) do not exist for foreign carriers of that country 
        in the United States under the laws of the United 
        States or as a result of acts of United States carriers 
        or other persons providing maritime or maritime-related 
        services in the United States.
    (c) Investigations.--(1) Investigations under subsection 
(b) of this section may be initiated by the Commission on its 
own motion or on the petition of any person, including any 
common carrier, shipper, shippers' association, ocean 
transportation intermediary, or marine terminal operator, or 
any branch, department, agency, or other component of the 
Government of the United States.
    (2) The Commission shall complete any such investigation 
and render a decision within 120 days after it is initiated, 
except that the Commission may extend such 120-day period for 
an additional 90 days if the Commission is unable to obtain 
sufficient information to determine whether a condition 
specified in subsection (b) of this section exists. Any notice 
providing such an extension shall clearly state the reasons for 
such extension.
    (d) Information Requests.--(1) In order to further the 
purposes of subsection (b) of this section, the Commission may, 
by order, require any person (including any common carrier, 
shipper, shippers' association, ocean transportation 
intermediary, or marine terminal operator, or any officer, 
receiver, trustee, lessee, agent or employee thereof) to file 
with the Commission any periodic or special report, answers to 
questions, documentary material, or other information which the 
Commission considers necessary or appropriate. The Commission 
may require that the response to any such order shall be made 
under oath. Such response shall be furnished in the form and 
within the time prescribed by the Commission.
    (2) In an investigation under subsection (b) of this 
section, the Commission may issue subpoenas to compel the 
attendance and testimony of witnesses and the production of 
records or other evidence.
    (3) Notwithstanding any other provision of law, the 
Commission may, in its discretion, determine that any 
information submitted to it in response to a request under this 
subsection, or otherwise, shall not be disclosed to the public.
    (e) Action Against Foreign Carriers.--(1) Whenever, after 
notice and opportunity for comment or hearing, the Commission 
determines that the conditions specified in subsection (b) of 
this section exist, the Commission shall take such action as it 
considers necessary and appropriate against any foreign carrier 
that is a contributing cause to, or whose government is a 
contributing cause to, such conditions, in order to offset such 
conditions. Such action may include--
          (A) limitations on sailings to and from United States 
        ports or on the amount or type of cargo carried;
          (B) suspension, in whole or in part, of any or all 
        tariffs and service contracts, including the right of 
        an ocean common carrier to use any or all tariffs of 
        conferences in United States trades of which it is a 
        member for such period as the Commission specifies;
          (C) suspension, in whole or in part, of the right of 
        an ocean common carrier to operate under any agreement 
        filed with the Commission, including agreements 
        authorizing preferential treatment at terminals, 
        preferential terminal leases, space chartering, or 
        pooling of cargo or revenues with other ocean common 
        carriers; and
          (D) a fee, not to exceed $1,000,000 per voyage.
    (2) The Commission may consult with, seek the cooperation 
of, or make recommendations to other appropriate Government 
agencies prior to taking any action under this subsection.
    (3) Before a determination under this subsection becomes 
effective or a request is made under subsection (f) of this 
section, the determination shall be submitted immediately to 
the President who may, within 10 days after receiving such 
determination, disapprove the determination in writing, setting 
forth the reasons for the disapproval, if the President finds 
that disapproval is required for reasons of the national 
defense or the foreign policy of the United States.
    (f) Actions Upon Request of the Commission.--Whenever the 
conditions specified in subsection (b) of this section are 
found by the Commission to exist, upon the request of the 
Commission--
          (1) the collector of customs at any port or place of 
        destination in the United States shall refuse the 
        clearance required by section 4197 of the Revised 
        Statutes (46 App. U.S.C. 91) to any vessel of a foreign 
        carrier that is identified by the Commission under 
        subsection (e) of this section; and
          (2) the Secretary of the department in which the 
        Coast Guard is operating shall deny entry, for purposes 
        of oceanborne trade, of any vessel of a foreign carrier 
        that is identified by the Commission under subsection 
        (e) of this section to any port or place in the United 
        States or the navigable waters of the United States, or 
        shall detain any such vessel at the port or place in 
        the United States from which it is about to depart for 
        any other port or place in the United States.
    (g) Report.--The Commission shall include in its annual 
report to Congress--
          (1) a list of the twenty foreign countries which 
        generated the largest volume of oceanborne liner cargo 
        for the most recent calendar year in bilateral trade 
        with the United States;
          (2) an analysis of conditions described in subsection 
        (b) of this section being investigated or found to 
        exist in foreign countries;
          (3) any actions being taken by the Commission to 
        offset such conditions;
          (4) any recommendations for additional legislation to 
        offset such conditions; and
          (5) a list of petitions filed under subsection (c) of 
        this section that the Commission rejected, and the 
        reasons for each such rejection.
    (h) The actions against foreign carriers authorized in 
subsections (e) and (f) of this section may be used in the 
administration and enforcement of section 13(b)(6) of the 
Shipping Act of 1984 (46 App. U.S.C. 1712(b)(6)) or section 
19(1)(b) of the Merchant Marine Act, 1920 (46 App. U.S.C. 876).
    (i) Any rule, regulation or final order of the Commission 
issued under this section shall be reviewable exclusively in 
the same forum and in the same manner as provided in section 
2342(3)(B) of title 28, United States Code.

                  C. UNFAIR PRACTICES IN IMPORT TRADE


           Section 337 of the Tariff Act of 1930, as amended


 [19 U.S.C. 1337; P.L. 71-361, as amended by P.L. 85-686, P.L. 93-618, 
 P.L. 96-39, P.L. 96-417, P.L. 97-164, P.L. 98-620, P.L. 100-418, P.L. 
 100-647, P.L. 102-563, P.L. 102-572, P.L. 103-465, P.L. 104-295, P.L. 
                                106-113]

SEC. 337. UNFAIR PRACTICES IN IMPORT TRADE.

    (a) Unfair Methods of Competition Declared Unlawful.--
          (1) Subject to paragraph (2), the following are 
        unlawful, and when found by the Commission to exist 
        shall be dealt with, in addition to any other provision 
        of law, as provided in this section:
                  (A) unfair methods of competition and unfair 
                acts in the importation of articles (other than 
                articles provided for in subparagraphs (B), 
                (C), (D), and (E) into the United States, or in 
                the sale of such articles by the owner, 
                importer, or consignee, the threat or effect or 
                which is--
                          (i) to destroy or substantially 
                        injure an industry in the United 
                        States;
                          (ii) to prevent the establishment of 
                        such an industry; or
                          (iii) to restrain or monopolize trade 
                        and commerce in the United States.
                  (B) the importation into the United States, 
                the sale for importation, or the sale within 
                the United States after importation by the 
                owner, importer, or consignee of articles 
                that--
                          (i) infringe a valid and enforceable 
                        United States patent or a valid and 
                        enforceable United States copy-right 
                        registered under title 17, United 
                        States Code; or
                          (ii) are made, produced, processed, 
                        or mined under, or by means of, a 
                        process covered by the claims of a 
                        valid and enforceable United States 
                        patent.
                  (C) the importation into the United States, 
                the sale for importation, or the sale within 
                the United States after importation by the 
                owner, importer, or consignee, of articles that 
                infringe a valid and enforceable United States 
                trademark registered under the Trademark Act of 
                1946.
                  (D) the importation into the United States, 
                the sale for importation or the sale within the 
                United States after importation by the owner, 
                importer, or consignee, of a semiconductor chip 
                product in a manner that constitutes 
                infringement of a mask work registered under 
                chapter 9 of title 17, United States Code.
                  (E) the importation into the United States, 
                the sale for importation, or the sale within 
                the United States after importation by the 
                owner, importer, or consigner, of an article 
                that constitutes infringement of the exclusive 
                rights in a design protected under chapter 13 
                of title 17, United States Code.
          (2) Subparagraphs (B), (C), and (D) of paragraph (1) 
        apply only if an industry in the United States, 
        relating to the articles protected by the patent, 
        copyright, trademark, mask work, or design concerned, 
        exists or is in the process of being established.
          (3) For purposes of paragraph (2), an industry in the 
        United States shall be considered to exist if there is 
        in the United States, with respect to the articles 
        protected by the patent, copyright, trademark, mask 
        work, or design concerned--
                  (A) significant investment in plant and 
                equipment;
                  (B) significant employment of labor or 
                capital; or
                  (C) substantial investment in its 
                exploitation, including engineering, research 
                and development, or licensing.
          (4) For the purposes of this section, the phrase 
        ``owner, importer, or consignee'' includes any agent of 
        the owner, importer, or consignee.
    (b) Investigations of Violations by Commission.--(1) The 
Commission shall investigate any alleged violation of this 
section on complaint under oath or upon its initiative. Upon 
commencing any such investigation, the Commissioner shall 
publish notice thereof in the Federal Register. The Commission 
shall conclude any such investigation and make its 
determination under this section at the earliest practicable 
time after the date of publication of notice of such 
investigation. To promote expeditious adjudication, the 
Commission shall, within 45 days after an investigation is 
initiated, establish a target date for its final determination.
    (2) During the course of each investigation under this 
section, the Commission shall consult with, and seek advice and 
information from, the Department of Health and Human Services, 
the Department of Justice, the Federal Trade Commission, and 
such other departments and agencies as it considers 
appropriate.
    (3) Whenever, in the course of an investigation under this 
section, the Commission has reason to believe, based on 
information before it, that a matter, in whole or in part, may 
come within the purview of subtitle B of title VII of this Act, 
it shall promptly notify the Secretary of Commerce so that such 
action may be taken as is otherwise authorized by such 
subtitle. If the Commission has reason to believe that the 
matter before it (A) is based solely on alleged acts and 
effects which are within the purview of section 701 or 731, or 
(B) relates to an alleged copyright infringement with respect 
to which action is prohibited by section 1008 of title 17, 
United States Code, the Commission shall terminate, or not 
institute, any investigation into the matter. If the Commission 
has reason to believe the matter before it is based in part on 
alleged acts and effects which are within the purview of 
section 701 or 731 of this Act, and in part on alleged acts and 
effects which may, independently from or in conjunction with 
those within the purview of such section, establish a basis for 
relief under this section, then it may institute or continue an 
investigation into the matter. If the Commission notifies the 
Secretary or the administering authority (as defined in section 
771(1) of this Act) with respect to a matter under this 
paragraph, the Commission may suspend its investigation during 
the time the matter is before the Secretary or administering 
authority for final decision. Any final decision by the 
administering authority under section 701 or 731 of this Act 
with respect to the matter within such section 701 or 731 of 
which the Commission has notified the Secretary or 
administering authority shall be conclusive upon the Commission 
with respect to the issue of less-than-fair-value sales or 
subsidization and the matters necessary for such decision.
    (c) Determinations; Review.--The Commission shall 
determine, with respect to each investigation conducted by it 
under this section, whether or not there is a violation of this 
section, except that the Commission may, by issuing a consent 
order or on the basis of an agreement between the private 
parties to the investigation, including an agreement to present 
the matter for arbitration, terminate any such investigation, 
in whole or in part, without making such a determination. Each 
determination under subsection (d) or (e) shall be made on the 
record after notice and opportunity for a hearing in conformity 
with the provisions of subchapter II of chapter 5 of title 5, 
United States Code. All legal and equitable defenses may be 
presented in all cases. A respondent may raise any counterclaim 
in a manner prescribed by the Commission. Immediately after a 
counterclaim is received by the Commission, the respondent 
raising such counterclaim shall file a notice of removal with a 
United States district court in which venue for any of the 
counterclaims raised by the party would exist under section 
1391 of title 28, United States Code. Any counterclaim raised 
pursuant to this section shall relate back to the date of the 
original complaint in the proceeding before the Commission. 
Action on such counterclaim shall not delay or affect the 
proceeding under this section, including the legal and 
equitable defenses that may be raised under this subsection. 
Any person adversely affected by a final determination of the 
Commission under subsection (d), (e), (f), or (g) may appeal 
such determination, within 60 days after the determination 
becomes final, to the United States Court of Appeals for the 
Federal Circuit for review in accordance with chapter 7 of 
title 5, United States Code. Notwithstanding the foregoing 
provisions of this subsection, Commission determinations under 
subsections (d), (e), (f), and (g) with respect to its findings 
on the public health and welfare, competitive conditions in the 
United States economy, the production of like or directly 
competitive articles in the United States, and United States 
consumers, the amount and nature of bond, or the appropriate 
remedy shall be reviewable in accordance with section 706 of 
title 5, United States Code. Determinations by the Commission 
under subsections (e), (f), and (j) with respect to forfeiture 
of bonds and under subsection (h) with respect to the 
imposition of sanctions for abuse of discovery or abuse of 
process shall also be reviewable in accordance with section 706 
of title 5, United States Code.
    (d) Exclusion of Articles From Entry.--(1) If the 
Commission determines, as a result of an investigation under 
this section, that there is a violation of this section, it 
shall direct that the articles concerned, imported by any 
person violating the provision of this section, be excluded 
from entry into the United States, unless, after considering 
the effect of such exclusion upon the public health and 
welfare, competitive conditions in the United States economy, 
the production of like or directly competitive articles in the 
United States, and United States consumers, it finds that such 
articles should not be excluded from entry. The Commission 
shall notify the Secretary of the Treasury of its action under 
this subsection directing such exclusion from entry, and upon 
receipt of such notice, the Secretary shall, through the proper 
officers, refuse such entry.
    (2) The authority of the Commission to order an exclusion 
from entry of articles shall be limited to persons determined 
by the Commission to be violating this section unless the 
Commission determines that--
          (A) a general exclusion from entry of articles is 
        necessary to prevent circumvention of an exclusion 
        order limited to products of named persons; or
          (B) there is a pattern of violation of this section 
        and it is difficult to identify the source of 
        infringing products.
    (e) Exclusion of Articles From Entry During Investigation 
Except Under Bond.--(1) If, during the course of an 
investigation under this section, the Commission determines 
that there is reason to believe that there is a violation of 
this section, it may direct that the articles concerned, 
imported by any person with respect to whom there is reason to 
believe that such person is violating this section, be excluded 
from entry into the United States, unless, after considering 
the effect of such exclusion upon the public health and 
welfare, competitive conditions in the United States economy, 
the production of like or directly competitive articles in the 
United States, and United States consumers, it finds that such 
articles should not be excluded from entry. The Commission 
shall notify the Secretary of the Treasury of its action under 
this subsection directing such exclusion from entry, and upon 
receipt of such notice, the Secretary shall, through the proper 
officers, refuse such entry, except that such articles shall be 
entitled to entry under bond prescribed by the Secretary in an 
amount determined by the Commission to be sufficient to protect 
the complainant from any injury. If the Commission later 
determines that the respondent has violated the provisions of 
this section, the bond may be forfeited to the complainant.
    (2) A complainant may petition the Commission for the 
issuance of an order under this subsection. The Commission 
shall make a determination with regard to such petition by no 
later than the 90th day after the date on which the 
Commission's notice of investigation is published in the 
Federal Register. The Commission may extend the 90-day period 
for an additional 60 days in a case it designates as a more 
complicated case. The Commission shall publish in the Federal 
Register its reasons why it designated the case as being more 
complicated. The Commission may require the complainant to post 
a bond as a prerequisite to the issuance of an order under this 
subsection. If the Commission later determines that the 
respondent has not violated the provisions of this section, the 
bond may be forfeited to the respondent.
    (3) The Commission may grant preliminary relief under this 
subsection or subsection (f) to the same extent as preliminary 
injunctions and temporary restraining orders may be granted 
under the Federal Rules of Civil Procedure.
    (4) The Commission shall prescribe the terms and conditions 
under which bonds may be forfeited under paragraphs (1) and 
(2).
    (f) Cease and Desist Orders.--(1) In addition to, or in 
lieu of, taking action under subsection (d) or (e), the 
Commission may issue and cause to be served on any person 
violating this section, or believed to be violating this 
section, as the case may be, an order directing such person to 
cease and desist from engaging in the unfair methods or acts 
involved, unless after considering the effect of such order 
upon the public health and welfare, competitive conditions in 
the United States economy, the production of like or directly 
competitive articles in the United States, and United States 
consumers, it finds that such order should not be issued. The 
Commission may at any time, upon such notice and in such manner 
as it deems proper, modify or revoke any such order, and, in 
the case of a revocation, may take action under subsection (d) 
or (e), as the case may be. If a temporary cease and desist 
order is issued in addition to, or in lieu of, an exclusion 
order under subsection (e), the Commission may require the 
complainant to post a bond, in an amount determined by the 
Commission to be sufficient to protect the respondent from any 
injury, as a prerequisite to the issuance of an order under 
this subsection. If the Commission later determines that the 
respondent has not violated the provisions of this section, the 
bond may be forfeited to the respondent. The Commission shall 
prescribe the terms and conditions under which the bonds may be 
forfeited under this paragraph.
    (2) Any person who violates an order issued by the 
Commission under paragraph (1) after it has become final shall 
forfeit and pay to the United States a civil penalty for each 
day on which an importation of articles, or their sale, occurs 
in violation of the order of not more than the greater of 
$100,000, twice the domestic value of the articles entered or 
sold on such day in violation of the order. Such penalty shall 
accrue to the United States and may be recovered for the United 
States in a civil action brought by the Commission in the 
Federal District Court for the District of Columbia or for the 
district in which the violation occurs. In such actions, the 
United States district courts may issue mandatory injunctions 
incorporating the relief sought by the Commission as they deem 
appropriate in the enforcement of such final orders of the 
Commission.
    (g)(1) If--
          (A) a complaint is filed against a person under this 
        section;
          (B) the complaint and a notice of investigation are 
        served on the person;
          (C) the person fails to respond to the complaint and 
        notice or otherwise fails to appear to answer the 
        complaint and notice;
          (D) the person fails to show good cause why the 
        person should not be found in default; and
          (E) the complainant seeks relief limited solely to 
        that person;
the Commission shall presume the facts alleged in the complaint 
to be true and shall, upon request, issue an exclusion from 
entry or a cease and desist order, or both, limited to that 
person unless, after considering the effect of such exclusion 
or order upon the public health and welfare, competitive 
conditions in the United States economy, the production of like 
or directly competitive articles in the United States, and 
United States consumers, the Commission finds that such 
exclusion or order should not be issued.
    (2) In addition to the authority of the Commission to issue 
a general exclusion from entry of articles when a respondent 
appears to contest an investigation concerning a violation of 
the provisions of this section, a general exclusion from entry 
of articles, regardless of the source or importer of the 
articles, may be issued if--
          (A) no person appears to contest an investigation 
        concerning a violation of the provisions of this 
        section,
          (B) such a violation is established by substantial, 
        reliable, and probative evidence, and
          (C) the requirements of subsection (d)(2) are met.
  (h) The Commission may by rule prescribe sanctions for abuse 
of discovery and abuse of process to the extent authorized by 
Rule 11 and Rule 37 of the Federal Rules of Civil Procedure.
    (i) Forfeiture.--
          (1) In addition to taking action under subsection 
        (d), the Commission may issue an order providing that 
        any article imported in violation of the provisions of 
        this section be seized and forfeited to the United 
        States if--
                  (A) the owner, importer, or consignee of the 
                article previously attempted to import the 
                article into the United States;
                  (B) the article was previously denied entry 
                into the United States by reason of an order 
                issued under subsection (d); and
                  (C) upon such previous denial of entry, the 
                Secretary of the Treasury provided the owner, 
                importer, or consignee of the article written 
                notice of--
                          (i) such order, and
                          (ii) the seizure and forfeiture that 
                        would result from any further attempt 
                        to import the article into the United 
                        States.
          (2) The Commission shall notify the Secretary of the 
        Treasury of any order issued under this subsection and, 
        upon receipt of such notice, the Secretary of the 
        Treasury shall enforce such order in accordance with 
        the provisions of this section.
          (3) Upon the attempted entry of articles subject to 
        an order issued under this subsection, the Secretary of 
        the Treasury shall immediately notify all ports of 
        entry of the attempted importation and shall identify 
        the persons notified under paragraph (1)(C).
          (4) The Secretary of the Treasury shall provide--
                  (A) the written notice described in paragraph 
                (1)(C) to the owner, importer, or consignee of 
                any article that is denied entry into the 
                United States by reason of an order issued 
                under subsection (d); and
                  (B) a copy of such written notice to the 
                Commission.
  (j) Referral to the President.--(1) If the Commission 
determines that there is a violation of this section, or that, 
for purposes of subsection (e), there is reason to believe that 
there is such a violation, it shall--
          (A) publish such determination in the Federal 
        Register, and
          (B) transmit to the President a copy of such 
        determination and the action taken under subsection 
        (d), (e), (f), (g), or (i), with respect thereto, 
        together with the record upon which such determination 
        is based.
    (2) If, before the close of the 60-day period beginning on 
the day after the day on which he receives a copy of such 
determination, the President, for policy reasons, disapproves 
such determination and notifies the Commission of his 
disapproval, then, effective on the date of such notice, such 
determination and the action taken under subsection (d), (e), 
(f), (g), or (i) with respect thereto shall have no force or 
effect.
    (3) Subject to the provisions of paragraph (2), such 
determination shall, except for purposes of subsection (c), be 
effective upon publication thereof in the Federal Register, and 
the action taken under subsection (d), (e), (f), (g), or (i) 
with respect thereto shall be effective as provided in such 
subsections, except that articles directed to be excluded from 
entry under subsection (d) or subject to a cease and desist 
order under subsection (f) shall, until such determination 
becomes final, be entitled to entry under bond prescribed by 
the Secretary in an amount determined by the Commission to be 
sufficient to protect the complainant from any injury. If the 
determination becomes final, the bond may be forfeited to the 
complainant. The Commission shall prescribe the terms and 
conditions under which bonds may be forfeited under this 
paragraph.
    (4) If the President does not disapprove such determination 
within such 60-day period, or if he notifies the Commission 
before the close of such period that he approves such 
determination, then, for purposes of paragraph (3) and 
subsection (c) such determination shall become final on the day 
after the close of such period or the day on which the 
President notifies the Commission of his approval, as the case 
may be.
    (k) Period of Effectiveness.--(1) Except as provided in 
subsections (f) and (j), any exclusion from entry or order 
under this section shall continue in effect until the 
Commission finds, and in the case of exclusion from entry 
notifies the Secretary of the Treasury, that the conditions 
which led to such exclusion from entry or order no longer 
exist.
    (2) If any person who has previously been found by the 
Commission to be in violation of this section petitions the 
Commission for a determination that the petitioner is no longer 
in violation of this section or for a modification or 
rescission of an exclusion from entry or order under subsection 
(d), (e), (f), (g), or (i)--
          (A) the burden of proof in any proceeding before the 
        Commission regarding such petition shall be on the 
        petitioner; and
          (B) relief may be granted by the Commission with 
        respect to such petition--
                  (i) on the basis of new evidence or evidence 
                that could not have been presented at the prior 
                proceeding, or
                  (ii) on grounds which would permit relief 
                from a judgment or order under the Federal 
                Rules of Civil Procedure.
    (l) Importations by or for the United States.--Any 
exclusion from entry or order under subsection (d), (e), (f), 
(g), or (i), in cases based on a preceding involving a patent, 
copyright, mask work, or design under subsection (a)(1), shall 
not apply to any articles imported by and for the use of the 
United States, or imported for, and to be used for, the United 
States with the authorization or consent of the Government. 
Whenever any article would have been excluded from entry or 
would not have been entered pursuant to the provisions of such 
subsections but for the operation of this subsection, an owner 
of the patent, copyright, or mask work adversely affected shall 
be entitled to reasonable and entire compensation in an action 
before the United States Court of Federal Claims pursuant to 
the procedures of section 1498 of title 28, United States Code.
    (m) Definition of United States.--For purposes of this 
section and sections 338 and 340, the term ``United States'' 
means the customs territory of the United States as defined in 
general note 2 of the Harmonized Tariff Schedule of the United 
States.
    (n)(1) Information submitted to the Commission or exchanged 
among the parties in connection with proceedings under this 
section which is properly designated as confidential pursuant 
to Commission rules may not be disclosed (except under a 
protective order issued under regulations of the Commission 
which authorizes limited disclosure of such information) to any 
person (other than a person described in paragraph (2)) without 
the consent of the person submitting it.
    (2) Notwithstanding the prohibition contained in paragraph 
(1), information referred to in that paragraph may be disclosed 
to--
          (A) an officer or employee of the Commission who is 
        directly concerned with--
                  (i) carrying out the investigation or related 
                proceeding in connection with which the 
                information is submitted,
                  (ii) the administration of a bond posted 
                pursuant to subsection (e), (f), or (j),
                  (iii) the administration or enforcement of an 
                exclusion order issued pursuant to subsection 
                (d), (e), or (g), a cease and desist order 
                issued pursuant to subsection (f), or a consent 
                order issued pursuant to subsection (c),
                  (iv) proceedings for the modification or 
                rescission of a temporary or permanent order 
                issued under subsection (d), (e), (f), (g), or 
                (i), or a consent order issued under this 
                section, or
                  (v) maintaining the administrative record of 
                the investigation or related proceeding,
          (B) an officer or employee of the United States 
        Government who is directly involved in the review under 
        subsection (j), or
          (C) an officer or employee of the United States 
        Customs Service who is directly involved in 
        administering an exclusion from entry under subsection 
        (d), (e), or (g) resulting from the investigation or 
        related proceeding in connection with which the 
        information is submitted.

                          D. SAFEGUARD ACTIONS


 Chapter 1 of Title II (Sections 201-204) of the Trade Act of 1974, as 
                                amended


    [19 U.S.C. 2251 et seq.; P.L. 93-618, as amended by P.L. 96-39, 
Reorganization Plan No. 3 of 1979, P.L. 98-573, P.L. 100-418, P.L. 100-
           647, P.L. 103-182, P.L. 103-465, and P.L. 104-295]

    Chapter 1--Positive Adjustment by Industries Injured by Imports


SEC. 201. ACTION TO FACILITATE POSITIVE ADJUSTMENT TO IMPORT 
                    COMPETITION.

    (a) Presidential Action.--If the United States 
International Trade Commission (hereinafter referred to in this 
chapter as the ``Commission'') determines under section 202(b) 
that an article is being imported into the United States in 
such increased quantities as to be a substantial cause of 
serious injury, or the threat thereof, to the domestic industry 
producing an article like or directly competitive with the 
imported article, the President, in accordance with this 
chapter, shall take all appropriate and feasible action within 
his power which the President determines will facilitate 
efforts by the domestic industry to make a positive adjustment 
to import competition and provide greater economic and social 
benefits than costs.
    (b) Positive Adjustment to Import Competition.--
          (1) For purposes of this chapter, a positive 
        adjustment to import competition occurs when--
                  (A) the domestic industry--
                          (i) is able to compete successfully 
                        with imports after actions taken under 
                        section 204 terminate, or
                          (ii) the domestic industry 
                        experiences an orderly transfer of 
                        resources to other productive pursuits; 
                        and
                  (B) dislocated workers in the industry 
                experience an orderly transition to productive 
                pursuits.
          (2) The domestic industry may be considered to have 
        made a positive adjustment to import competition even 
        though the industry is not of the same size and 
        composition as the industry at the time the 
        investigation was initiated under section 202(b).

SEC. 202. INVESTIGATIONS, DETERMINATIONS, AND RECOMMENDATIONS BY 
                    COMMISSION.

    (a) Petitions and Adjustment Plans.--
          (1) A petition requesting action under this chapter 
        for the purpose of facilitating positive adjustment to 
        import competition may be filed with the Commission by 
        an entity, including a trade association, firm, 
        certified or recognized union, or group of workers, 
        which is representative of an industry.
          (2) A petition under paragraph (1)--
                  (A) shall include a statement describing the 
                specific purposes for which action is being 
                sought, which may include facilitating the 
                orderly transfer of resources to more 
                productive pursuits, enhancing competitiveness, 
                or other means of adjustment to new conditions 
                of competition; and
                  (B) may-- 
                          (i) subject to subsection 
                        (d)(1)(C)(i), request provisional 
                        relief under subsection (d)(1); or
                          (ii) request provisional relief under 
                        subsection (d)(2).
          (3) Whenever a petition is filed under paragraph (1), 
        the Commission shall promptly transmit copies of the 
        petition to the Office of the United States Trade 
        Representative and other Federal agencies directly 
        concerned.
          (4) A petitioner under paragraph (1) may submit to 
        the Commission and the United States Trade 
        Representative (hereafter in this chapter referred to 
        as the ``Trade Representative''), either with the 
        petition, or at any time within 120 days after the date 
        of filing of the petition, a plan to facilitate 
        positive adjustment to import competition.
          (5)(A) Before submitting an adjustment plan under 
        paragraph (4), the petitioner and other entities 
        referred to in paragraph (1) that wish to participate 
        may consult with the Trade Representative and the 
        officers and employees of any Federal agency that is 
        considered appropriate by the Trade Representative, for 
        purposes of evaluating the adequacy of the proposals 
        being considered for inclusion in the plan in relation 
        to specific actions that may be taken under this 
        chapter.
          (B) A request for any consultation under subparagraph 
        (A) must be made to the Trade Representative. Upon 
        receiving such a request, the Trade Representative 
        shall confer with the petitioner and provide such 
        assistance, including publication of appropriate notice 
        in the Federal Register, as may be practicable in 
        obtaining other participants in the consultation. No 
        consultation may occur under subparagraph (A) unless 
        the Trade Representative, or his delegate, is in 
        attendance.
          (6)(A) In the course of any investigation under 
        subsection (b), the Commission shall seek information 
        (on a confidential basis, to the extent appropriate) on 
        actions being taken, or planned to be taken, or both, 
        by firms and workers in the industry to make a positive 
        adjustment to import competition.
          (B) Regardless whether an adjustment plan is 
        submitted under paragraph (4) by the petitioner, if the 
        Commission makes an affirmative determination under 
        subsection (b), any--
                  (i) firm in the domestic industry;
                  (ii) certified or recognized union or group 
                of workers in the domestic industry;
                  (iii) State or local community;
                  (iv) trade association representing the 
                domestic industry; or
                  (v) any other person or group of persons,
        may, individually, submit to the Commission commitments 
        regarding actions such persons and entities intend to 
        take to facilitate positive adjustment to import 
        competition.
          (7) Nothing in paragraphs (5) and (6) may be 
        construed to provide immunity under the antitrust laws.
          (8) The procedures concerning the release of 
        confidential business information set forth in section 
        332(g) of the Tariff Act of 1930 shall apply with 
        respect to information received by the Commission in 
        the course of investigations conducted under this 
        chapter and part 1 of title III of the North American 
        Free Trade Agreement Implementation Act. The Commission 
        may request that parties providing confidential 
        business information furnish nonconfidential summaries 
        thereof or, if such parties indiciate that the 
        information in the submission cannot be summarized, the 
        reasons why a summary cannot be provided. If the 
        Commission finds that a request for confidentiality is 
        not warranted and if the party concerned is either 
        unwilling to make the information public or to 
        authorize its disclosure in generalized or summarized 
        form, the Commission may disregard the submission.
    (b) Investigations and Determinations by Commission.--
          (1)(A) Upon the filing of a petition under subsection 
        (a), the request of the President or the Trade 
        Representative, the resolution of either the Committee 
        on Ways and Means of the House of Representatives or 
        the Committee on Finance of the Senate, or on its own 
        motion, the Commission shall promptly make an 
        investigation to determine whether an article is being 
        imported into the United States in such increased 
        quantities as to be a substantial cause of serious 
        injury, or the threat thereof, to the domestic industry 
        producing an article like or directly competitive with 
        the imported article.
          (B) For purposes of this section, the term 
        ``substantial cause'' means a cause which is important 
        and not less than any other cause.
          (2)(A) Except as provided in subparagraph (B), the 
        Commission shall make the determination under paragraph 
        (1) within 120 days (180 days if the petition alleges 
        that critical circumstances exist) after the date on 
        which the petition is filed, the request or resolution 
        is received, or the motion is adopted, as the case may 
        be.
          (B) If before the 100th day after a petition is filed 
        under subsection (a)(1) the Commission determines that 
        the investigation is extraordinarily complicated, the 
        Commission shall make the determination under paragraph 
        (1) within 150 days (210 days if the petition alleges 
        that critical circumstances exist) after the date 
        referred to in subparagraph (A).
          (3) The Commission shall publish notice of the 
        commencement of any proceeding under this subsection in 
        the Federal Register and shall, within a reasonable 
        time thereafter, hold public hearings at which the 
        Commission shall afford interested parties and 
        consumers an opportunity to be present, to present 
        evidence, to comment on the adjustment plan, if any, 
        submitted under subsection (a), to respond to the 
        presentations of other parties and consumers, and 
        otherwise to be heard.
    (c) Factors Applied in Making Determinations.--
          (1) In making determinations under subsection (b), 
        the Commission shall take into account all economic 
        factors which it considers relevant, including (but not 
        limited to)--
                  (A) with respect to serious injury--
                          (i) the significant idling of 
                        productive facilities in the domestic 
                        industry,
                          (ii) the inability of a significant 
                        number of firms to carry out domestic 
                        production operations at a reasonable 
                        level of profit, and
                          (iii) significant unemployment or 
                        underemployment within the domestic 
                        industry;
                  (B) with respect to threat of serious 
                injury--
                          (i) a decline in sales or market 
                        share, a higher and growing inventory 
                        (whether maintained by domestic 
                        producers, importers, wholesalers, or 
                        retailers), and a downward trend in 
                        production, profits, wages, 
                        productivity, or employment (or 
                        increasing underemployment) in the 
                        domestic industry,
                          (ii) the extent to which firms in the 
                        domestic industry are unable to 
                        generate adequate capital to finance 
                        the modernization of their domestic 
                        plants and equipment, or are unable to 
                        maintain existing levels of 
                        expenditures for research and 
                        development,
                          (iii) the extent to which the United 
                        States market is the focal point for 
                        the diversion of exports of the article 
                        concerned by reason of restraints on 
                        exports of such article to, or on 
                        imports of such article into, third 
                        country markets; and
                  (C) with respect to substantial cause, an 
                increase in imports (either actual or relative 
                to domestic production) and a decline in the 
                proportion of the domestic market supplied by 
                domestic producers.
          (2) In making determinations under subsection (b), 
        the Commission shall--
                  (A) consider the condition of the domestic 
                industry over the course of the relevant 
                business cycle, but may not aggregate the 
                causes of declining demand associated with a 
                recession or economic downturn in the United 
                States economy into a single cause of serious 
                injury or threat of injury; and
                  (B) examine factors other than imports which 
                may be a cause of serious injury, or threat of 
                serious injury, to the domestic industry.
        The Commission shall include the results of its 
        examination under subparagraph (B) in the report 
        submitted by the Commission to the President under 
        subsection (e).
          (3) The presence or absence of any factor which the 
        Commission is required to evaluate in subparagraphs (A) 
        and (B) of paragraph (1) is not necessarily dispositive 
        of whether an article is being imported into the United 
        States in such increased quantities as to be a 
        substantial cause of serious injury, or the threat 
        thereof, to the domestic industry.
          (4) For purposes of subsection (b), in determining 
        the domestic industry producing an article like or 
        directly competitive with an imported article, the 
        Commission--
                  (A) to the extent information is available, 
                shall, in the case of a domestic producer which 
                also imports, treat as part of such domestic 
                industry only its domestic production;
                  (B) may, in the case of a domestic producer 
                which produces more than one article, treat as 
                part of such domestic industry only that 
                portion or subdivision of the producer which 
                produces the like or directly competitive 
                article; and
                  (C) may, in the case of one or more domestic 
                producers which produce a like or directly 
                competitive article in a major geographic area 
                of the United States and whose production 
                facilities in such area for such article 
                constitute a substantial portion of the 
                domestic industry in the United States and 
                primarily serve the market in such area, and 
                where the imports are concentrated in such 
                area, treat as such domestic industry only that 
                segment of the production located in such area.
          (5) In the course of any proceeding under this 
        subsection, the Commission shall investigate any factor 
        which in its judgment may be contributing to increased 
        imports of the article under investigation. Whenever in 
        the course of its investigation the Commission has 
        reason to believe that the increased imports are 
        attributable in part to circumstances which come within 
        the purview of subtitles A and B of title VII or 
        section 337 of the Tariff Act of 1930, or other 
        remedial provisions of law, the Commission shall 
        promptly notify the appropriate agency so that such 
        action may be taken as is otherwise authorized by such 
        provisions of law.
          (6) For purposes of this section:
                  (A)(i) The term ``domestic industry'' means, 
                with respect to an article, the producers as a 
                whole of the like or directly competitive 
                article or those producers whose collective 
                production of the like or directly competitive 
                article constitutes a major proportion of the 
                total domestic production of such article.
                  (ii) The term ``domestic industry'' includes 
                producers located in the United States insular 
                possessions.
                  (B) The term ``significant idling of 
                productive facilities'' includes the closing of 
                plants or the underutilization of production 
                capacity.
                  (C) The term ``serious injury'' means a 
                significant overall impairment in the position 
                of a domestic industry.
                  (D) The term ``threat of serious injury'' 
                means serious injury that is clearly imminent.
    (d) Provisional Relief.--
          (1)(A) An entity representing a domestic industry 
        that produces a perishable agricultural product or 
        citrus product that is like or directly competitive 
        with an imported perishable agricultural product or 
        citrus product may file a request with the Trade 
        Representative for the monitoring of imports of that 
        product under subparagraph (B). Within 21 days after 
        receiving the request, the Trade Representative shall 
        determine if--
                  (i) the imported product is a perishable 
                agricultural product or citrus product; and
                  (ii) there is a reasonable indication that 
                such product is being imported into the United 
                States in such increased quantities as to be, 
                or likely to be, a substantial cause of serious 
                injury, or the threat thereof, to such domestic 
                industry.
          (B) If the determinations under subparagraph (A) (i) 
        and (ii) are affirmative, the Trade Representative 
        shall request, under section 332(g) of the Tariff Act 
        of 1930, the Commission to monitor and investigate the 
        imports concerned for a period not to exceed 2 years. 
        The monitoring and investigation may include the 
        collection and analysis of information that would 
        expedite an investigation under subsection (b).
          (C) If a petition filed under subsection (a)--
                  (i) alleges injury from imports of a 
                perishable agricultural product or citrus 
                product that has been, on the date the 
                allegation is included in the petition, subject 
                to monitoring by the Commission under 
                subparagraph (B) for not less than 90 days; and
                  (ii) requests that provisional relief be 
                provided under this subsection with respect to 
                such imports;
        the Commission shall, not later than the 21st day after 
        the day on which the request was filed, make a 
        determination, on the basis of available information, 
        whether increased imports (either actual or relative to 
        domestic production) of the perishable agricultural 
        product or citrus product are a substantial cause of 
        serious injury, or the threat thereof, to the domestic 
        industry producing a like or directly competitive 
        perishable product or citrus product, and whether 
        either--
                  (I) the serious injury is likely to be 
                difficult to repair by reason of perishability 
                of the like or directly competitive 
                agricultural product; or
                  (II) the serious injury cannot be timely 
                prevented through investigation under 
                subsection (b) and action under section 203.
          (D) At the request of the Commission, the Secretary 
        of Agriculture shall promptly provide to the Commission 
        any relevant information that the Department of 
        Agriculture may have for purposes of making 
        determinations and findings under this subsection.
          (E) Whenever the Commission makes an affirmative 
        preliminary determination under subparagraph (C), the 
        Commission shall find the amount or extent of 
        provisional relief that is necessary to prevent or 
        remedy the serious injury. In carrying out this 
        subparagraph, the Commission shall give preference to 
        increasing or imposing a duty on imports, if such form 
        of relief is feasible and would prevent or remedy the 
        serious injury.
          (F) The Commission shall immediately report to the 
        President its determination under subparagraph (C) and, 
        if the determination is affirmative, the finding under 
        subparagraph (E).
          (G) Within 7 days after receiving a report from the 
        Commission under subparagraph (F) containing an 
        affirmative determination, the President, if he 
        considers provisional relief to be warranted and after 
        taking into account the finding of the Commission under 
        subparagraph (E), shall proclaim such provisional 
        relief that the President considers necessary to 
        prevent or remedy the serious injury.
          (2)(A) When a petition filed under subsection (a) 
        alleges that critical circumstances exist and requests 
        that provisional relief be provided under this 
        subsection with respect to imports of the article 
        identified in the petition, the Commission shall, not 
        later than 60 days after the petition containing the 
        request was filed, determine, on the basis of available 
        information, whether--
                  (i) there is clear evidence that increased 
                imports (either actual or relative to domestic 
                production) of the article are a substantial 
                cause of serious injury, or the threat thereof, 
                to the domestic industry producing an article 
                like or directly competitive with the imported 
                article; and
                  (ii) delay in taking action under this 
                chapter would cause damage to that industry 
                that would be difficult to repair.
          (B) If the determinations under subparagraph (A)(i) 
        and (ii) are affirmative, the Commission shall find the 
        amount or extent of provisional relief that is 
        necessary to prevent or remedy the serious injury. In 
        carrying out this subparagraph, the Commission shall 
        give preference to increasing or imposing a duty on 
        imports, if such form of relief is feasible and would 
        prevent or remedy the serious injury.
          (C) The Commission shall immediately report to the 
        President its determinations under subparagraph (A)(i) 
        and (ii) and, if the determinations are affirmative, 
        the finding under subparagraph (B).
          (D) Within 30 days after receiving a report from the 
        Commission under subparagraph (C) containing an 
        affirmative determination under subparagraph (A)(i) and 
        (ii), the President, if he considers provisional relief 
        to be warranted and after taking into account the 
        finding of the Commission under subparagraph (B), shall 
        proclaim, for a period not to exceed 200 days, such 
        provisional relief that the President considers 
        necessary to prevent or remedy the serious injury. Such 
        relief shall take the form of an increase in, or the 
        imposition of, a duty on imports, if such form of 
        relief is feasible and would prevent or remedy the 
        serious injury.
          (3) If provisional relief is proclaimed under 
        paragraph (1)(G) or (2)(D) in the form of an increase, 
        or the imposition of, a duty, the President shall order 
        the suspension of liquidation of all imported articles 
        subject to the affirmative determination under 
        paragraph (1)(C) or paragraph (2)(A), as the case may 
        be, that are entered, or withdrawn from warehouse for 
        consumption, on or after the date of the determination.
          (4)(A) Any provisional relief implemented under this 
        subsection with respect to an imported article shall 
        terminate on the day on which--
                  (i) if such relief was proclaimed under 
                paragraph (1)(G) or (2)(D), the Commission 
                makes a negative determination under subsection 
                (b) regarding injury or the threat thereof by 
                imports of such article;
                  (ii) action described in section 203(a)(3) 
                (A) or (C) takes effect under section 203 with 
                respect to such article;
                  (iii) a decision by the President not to take 
                any action under section 203(a) with respect to 
                such article becomes final; or
                  (iv) whenever the President determines that, 
                because of changed circumstances, such relief 
                is no longer warranted.
          (B) Any suspension of liquidation ordered under 
        paragraph (3) with respect to an imported article shall 
        terminate on the day on which provisional relief is 
        terminated under subparagraph (A) with respect to the 
        article.
          (C) If an increase in, or the imposition of, a duty 
        that is proclaimed under section 203 on an imported 
        article is different from a duty increase or imposition 
        that was proclaimed for such an article under this 
        section, then the entry of any such article for which 
        liquidation was suspended under paragraph (3) shall be 
        liquidated at whichever of such rates of duty is lower.
          (D) If provisional relief in the form of an increase 
        in, or the imposition of, a duty is proclaimed under 
        this section with respect to an imported article and 
        neither a duty increase nor a duty imposition is 
        proclaimed under section 203 regarding such article, 
        the entry of any such article for which liquidation was 
        suspended under paragraph (3) may be liquidated at the 
        rate of duty that applied before provisional relief was 
        provided.
          (5) For purposes of this subsection:
                  (A) The term ``citrus product'' means any 
                processed oranges or grapefruit or any orange 
                or grapefruit juice, including concentrate.
                  (B) A perishable agricultural product is any 
                agricultural article, including livestock, 
                regarding which the Trade Representative 
                considers action under this section to be 
                appropriate after taking into account--
                          (i) whether the article has--
                                  (I) a short shelf life,
                                  (II) a short growing season, 
                                or
                                  (III) a short marketing 
                                period,
                          (ii) whether the article is treated 
                        as a perishable product under any other 
                        Federal law or regulation; and
                          (iii) any other factor considered 
                        appropriate by the Trade 
                        Representative.
                The presence or absence of any factor which the 
                Trade Representative is required to take into 
                account under clause (i), (ii), or (iii) is not 
                necessarily dispositive of whether an article 
                is a perishable agricultural product.
                  (C) The term ``provisional relief'' means--
                          (i) any increase in, or imposition 
                        of, any duty;
                          (ii) any modification or imposition 
                        of any quantitative restriction on the 
                        importation of an article into the 
                        United States; or
                          (iii) any combination of actions 
                        under clauses (i) and (ii).
    (e) Commission Recommendations.--
          (1) If the Commission makes an affirmative 
        determination under subsection (b)(1), the Commission 
        shall also recommend the action that would address the 
        serious injury, or threat thereof, to the domestic 
        industry and be most effective in facilitating the 
        efforts of the domestic industry to make a positive 
        adjustment to import competition.
          (2) The Commission is authorized to recommend under 
        paragraph (1)--
                  (A) an increase in, or the imposition of, any 
                duty on the imported article;
                  (B) a tariff-rate quota on the article;
                  (C) a modification or imposition of any 
                quantitative restriction on the importation of 
                the article into the United States;
                  (D) one or more appropriate adjustment 
                measures, including the provision of trade 
                adjustment assistance under chapter 2; or
                  (E) any combination of the actions described 
                in subparagraphs (A) through (D).
          (3) The Commission shall specify the type, amount, 
        and duration of the action recommended by it under 
        paragraph (1). The limitations set forth in section 
        203(e) are applicable to the action recommended by the 
        Commission.
          (4) In addition to the recommendation made under 
        paragraph (1), the Commission may also recommend that 
        the President--
                  (A) initiate international negotiations to 
                address the underlying cause of the increase in 
                imports of the article or otherwise to 
                alleviate the injury or threat; or
                  (B) implement any other action authorized 
                under law that is likely to facilitate positive 
                adjustment to import competition.
          (5) For purposes of making its recommendation under 
        this subsection, the Commission shall--
                  (A) after reasonable notice, hold a public 
                hearing at which all interested parties shall 
                be provided an opportunity to present testimony 
                and evidence; and
                  (B) take into account--
                          (i) the form and amount of action 
                        described in paragraph (2) (A), (B), 
                        and (C) that would prevent or remedy 
                        the injury or threat thereof,
                          (ii) the objectives and actions 
                        specified in the adjustment plan, if 
                        any, submitted under subsection (a)(4),
                          (iii) any individual commitment that 
                        was submitted to the Commission under 
                        subsection (a)(6),
                          (iv) any information available to the 
                        Commission concerning the conditions of 
                        competition in domestic and world 
                        markets, and likely developments 
                        affecting such conditions during the 
                        period for which action is being 
                        requested, and
                          (v) whether international 
                        negotiations may be constructive to 
                        address the injury or threat thereof or 
                        to facilitate adjustment.
          (6) Only those members of the Commission who agreed 
        to the affirmative determination under subsection (b) 
        are eligible to vote on the recommendation required to 
        be made under paragraph (1) or that may be made under 
        paragraph (3). Members of the Commission who did not 
        agree to the affirmative determination may submit, in 
        the report required under subsection (f), separate 
        views regarding what action, if any, should be taken 
        under section 203.
    (f) Report by Commission.--
          (1) The Commission shall submit to the President a 
        report on each investigation undertaken under 
        subsection (b). The report shall be submitted at the 
        earliest practicable time, but not later than 180 days 
        (240 days if the petition alleges that crucial 
        circumstances exist) after the date on which the 
        petition is filed, the request or resolution is 
        received, or the motion is adopted, as the case may be.
          (2) The Commission shall include in the report 
        required under paragraph (1) the following:
                  (A) The determination made under subsection 
                (b) and an explanation of the basis for the 
                determination.
                  (B) If the determination under subsection (b) 
                is affirmative, the recommendations for action 
                made under subsection (e) and an explanation of 
                the basis for each recommendation.
                  (C) Any dissenting or separate views by 
                members of the Commission regarding the 
                determination and any recommendation referred 
                to in subparagraphs (A) and (B).
                  (D) The findings required to be included in 
                the report under subsection (c)(2).
                  (E) A copy of the adjustment plan, if any, 
                submitted under section 201(b)(4).
                  (F) Commitments submitted, and information 
                obtained, by the Commission regarding steps 
                that firms and workers in the domestic industry 
                are taking, or plan to take, to facilitate 
                positive adjustment to import competition.
                  (G) A description of--
                          (i) the short- and long-term effects 
                        that implementation of the action 
                        recommended under subsection (e) is 
                        likely to have on the petitioning 
                        domestic industry, on other domestic 
                        industries, and on consumers, and
                          (ii) the short- and long-term effects 
                        of not taking the recommended action on 
                        the petitioning domestic industry, its 
                        workers and the communities where 
                        production facilities of such industry 
                        are located, and on other domestic 
                        industries.
          (3) The Commission, after submitting a report to the 
        President under paragraph (1), shall promptly make it 
        available to the public (with the exception of the 
        confidential information obtained under section 
        202(a)(6)(B) and any other information which the 
        Commission determines to be confidential) and cause a 
        summary thereof to be published in the Federal 
        Register.
    (g) Expedited Consideration of Adjustment Assistance 
Petitions.--If the Commission makes an affirmative 
determination under subsection (b)(1), the Commission shall 
promptly notify the Secretary of Labor and the Secretary of 
Commerce of the determination. After receiving such 
notification--
          (1) the Secretary of Labor shall give expedited 
        consideration to petitions by workers in the domestic 
        industry for certification for eligibility to apply for 
        adjustment assistance under chapter 2; and
          (2) the Secretary of Commerce shall give expedited 
        consideration to petitions by firms in the domestic 
        industry for certification of eligibility to apply for 
        adjustment assistance under chapter 3.
    (h) Limitations on Investigations.--
          (1) Except for good cause determined by the 
        Commission to exist, no investigation for the purposes 
        of this section shall be made with respect to the same 
        subject matter as a previous investigation under this 
        chapter, unless 1 year has elapsed since the Commission 
        made its report to the President of the results of such 
        previous investigation.
          (2) No new investigation shall be conducted with 
        respect to an article that is or has been the subject 
        of an action under section 203(a)(3)(A), (B), (C), or 
        (E) if the last day on which the President could take 
        action under section 203 in the new investigation is a 
        date earlier than that permitted under section 
        203(e)(7).
          (3)(A) Not later than the date on which the Textiles 
        Agreement enters into force with respect to the United 
        States, the Secretary of Commerce shall publish in the 
        Federal Register a list of all articles that are 
        subject to the Textiles Agreement. An investigation may 
        be conducted under this section concerning imports of 
        any article that is subject to the Textiles Agreement 
        only if the United States has integrated that article 
        into GATT 1994 pursuant to the Textiles Agreement, as 
        set forth in notices published in the Federal Register 
        by the Secretary of Commerce, including the notice 
        published under section 331 of the Uruguay Round 
        Agreements Act.
          (B) For purposes of this paragraph:
                  (i) The term `Textiles Agreement' means the 
                Agreement on Textiles and Clothing referred to 
                in section 101(d)(4) of the Uruguay Round 
                Agreements Act.
                  (ii) The term `GATT 1994' has the meaning 
                given that term in section 2(1)(B) of the 
                Uruguay Round Agreements Act.
    (i) Limited Disclosure of Confidential Business Information 
Under Protective Order.--The Commission shall promulgate 
regulations to provide access to confidential business 
information under protective order to authorized 
representatives of interested parties who are parties to an 
investigation under this section.

SEC. 203. ACTION BY PRESIDENT AFTER DETERMINATION OF IMPORT INJURY.

    (a) In General.--
          (1)(A) After receiving a report under section 202(f) 
        containing an affirmative finding regarding serious 
        injury, or the threat thereof, to a domestic industry, 
        the President shall take all appropriate and feasible 
        action within his power which the President determines 
        will facilitate efforts by the domestic industry to 
        make a positive adjustment to import competition and 
        provide greater economic and social benefits than 
        costs.
          (B) The action taken by the President under 
        subparagraph (A) shall be to such extent, and for such 
        duration, subject to subsection (e)(1), that the 
        President determines to be appropriate and feasible 
        under such subparagraph.
          (C) The interagency trade organization established 
        under section 242(a) of the Trade Expansion Act of 1962 
        shall, with respect to each affirmative determination 
        reported under section 202(f), make a recommendation to 
        the President as to what action the President should 
        take under subparagraph (A).
          (2) In determining what action to take under 
        paragraph (1), the President shall take into account--
                  (A) the recommendation and report of the 
                Commission;
                  (B) the extent to which workers and firms in 
                the domestic industry are--
                          (i) benefiting from adjustment 
                        assistance and other manpower programs, 
                        and
                          (ii) engaged in worker retraining 
                        efforts;
                  (C) the efforts being made, or to be 
                implemented, by the domestic industry 
                (including the efforts included in any 
                adjustment plan or commitment submitted to the 
                Commission under section 202(a)) to make a 
                positive adjustment to import competition;
                  (D) the probable effectiveness of the actions 
                authorized under paragraph (3) to facilitate 
                positive adjustment to import competition;
                  (E) the short- and long-term economic and 
                social costs of the actions authorized under 
                paragraph (3) relative to their short- and 
                long-term economic and social benefits and 
                other considerations relative to the position 
                of the domestic industry in the United States 
                economy;
                  (F) other factors related to the national 
                economic interest of the United States, 
                including, but not limited to--
                          (i) the economic and social costs 
                        which would be incurred by taxpayers, 
                        communities, and workers if import 
                        relief were not provided under this 
                        chapter,
                          (ii) the effect of the implementation 
                        of actions under this section on 
                        consumers and on competition in 
                        domestic markets for articles, and
                          (iii) the impact on United States 
                        industries and firms as a result of 
                        international obligations regarding 
                        compensation;
                  (G) the extent to which there is diversion of 
                foreign exports to the United States market by 
                reason of foreign restraints;
                  (H) the potential for circumvention of any 
                action taken under this section;
                  (I) the national security interests of the 
                United States; and
                  (J) the factors required to be considered by 
                the Commission under section 202(e)(5).
          (3) The President may, for purposes of taking action 
        under paragraph (1)--
                  (A) proclaim an increase in, or the 
                imposition of, any duty on the imported 
                article;
                  (B) proclaim a tariff-rate quota on the 
                article;
                  (C) proclaim a modification or imposition of 
                any quantitative restriction on the importation 
                of the article into the United States;
                  (D) implement one or more appropriate 
                adjustment measures, including the provision of 
                trade adjustment assistance under chapter 2;
                  (E) negotiate, conclude, and carry out 
                agreements with foreign countries limiting the 
                export from foreign countries and the import 
                into the United States of such article;
                  (F) proclaim procedures necessary to allocate 
                among importers by the auction of import 
                licenses quantities of the article that are 
                permitted to be imported into the United 
                States;
                  (G) initiate international negotiations to 
                address the underlying cause of the increase in 
                imports of the article or otherwise to 
                alleviate the injury or threat thereof;
                  (H) submit to Congress legislative proposals 
                to facilitate the efforts of the domestic 
                industry to make a positive adjustment to 
                import competition;
                  (I) take any other action which may be taken 
                by the President under the authority of law and 
                which the President considers appropriate and 
                feasible for purposes of paragraph (1); and
                  (J) take any combination of actions listed in 
                subparagraphs (A) through (I).
          (4)(A) Subject to subparagraph (B), the President 
        shall take action under paragraph (1) within 60 days 
        (50 days if the President has proclaimed provisional 
        relief under section 202(d)(2)(D) with respect to the 
        article concerned) after receiving a report from the 
        Commission containing an affirmative determination 
        under section 202(b)(1) (or a determination under such 
        section which he considers to be an affirmative 
        determination by reason of section 330(d) of the Tariff 
        Act of 1930).
          (B) If a supplemental report is requested under 
        paragraph (5), the President shall take action under 
        paragraph (1) within 30 days after the supplemental 
        report is received, except that, in a case in which the 
        President has proclaimed provisional relief under 
        section 202(d)(2)(D) with respect to the article 
        concerned, action by the President under paragraph (1) 
        may not be taken later than the 200th day after the 
        provisional relief was proclaimed.
          (5) The President may, within 15 days after the date 
        on which he receives a report from the Commission 
        containing an affirmative determination under section 
        202(b)(1), request additional information from the 
        Commission. The Commission shall, as soon as 
        practicable but in no event more than 30 days after the 
        date on which it receives the President's request, 
        furnish additional information with respect to the 
        industry in a supplemental report.
    (b) Reports to Congress.--
          (1) On the day the President takes action under 
        subsection (a)(1), the President shall transmit to 
        Congress a document describing the action and the 
        reasons for taking the action. If the action taken by 
        the President differs from the action required to be 
        recommended by the Commission under section 202(e)(1), 
        the President shall state in detail the reasons for the 
        difference.
          (2) On the day on which the President decides that 
        there is no appropriate and feasible action to take 
        under subsection (a)(1) with respect to a domestic 
        industry, the President shall transmit to Congress a 
        document that sets forth in detail the reasons for the 
        decision.
          (3) On the day on which the President takes any 
        action under subsection (a)(1) that is not reported 
        under paragraph (1), the President shall transmit to 
        Congress a document setting forth the action being 
        taken and the reasons therefor.
    (c) Implementation of Action Recommended by Commission.--If 
the President reports under subsection (b)(1) or (2) that--
          (1) the action taken under subsection (a)(1) differs 
        from the action recommended by the Commission under 
        section 202(e)(1); or
          (2) no action will be taken under subsection (a)(1) 
        with respect to the domestic industry;
the action recommended by the Commission shall take effect (as 
provided in subsection (d)(2)) upon the enactment of a joint 
resolution described in section 152(a)(1)(A) within the 90-day 
period beginning on the date on which the document referred to 
in subsection (b)(1) or (2) is transmitted to the Congress.
    (d) Time for Taking Effect of Certain Relief.--
          (1) Except as provided in paragraph (2), any action 
        described in subsection (a)(3) (A), (B), or (C), that 
        is taken under subsection (a)(1) shall take effect 
        within 15 days after the day on which the President 
        proclaims the action, unless the President announces, 
        on the date he decides to take such action, his 
        intention to negotiate one or more agreements described 
        in subsection (a)(3)(E) in which case the action under 
        subsection (a)(3) (A), (B), or (C) shall be proclaimed 
        and take effect within 90 days after the date of such 
        decision.
          (2) If the contingency set forth in subsection (c) 
        occurs, the President shall, within 30 days after the 
        date of the enactment of the joint resolution referred 
        to in such subsection, proclaim the action recommended 
        by the Commission under section 202(e)(1).
    (e) Limitations on Actions.--
          (1)(A) Subject to subparagraph (B), the duration of 
        the period in which an action taken under this section 
        may be in effect shall not exceed 4 years. Such period 
        shall include the period, if any, in which provisional 
        relief under section 202(d) was in effect.
          (B)(i) Subject to clause (ii), the President, after 
        receiving an affirmative determination from the 
        Commission under section 204(c) (or, if the Commission 
        is equally divided in its determination, a 
        determination which the President considers to be an 
        affirmative determination of the Commission), may 
        extend the effective period of any action under this 
        section if the President determines that--
                  (I) the action continues to be necessary to 
                prevent or remedy the serious injury; and
                  (II) there is evidence that the domestic 
                industry is making a positive adjustment to 
                import competition.
          (ii) The effective period of any action under this 
        section, including any extensions thereof, may not, in 
        the aggregate, exceed 8 years.
          (2) Action of a type described in subsection (a)(3) 
        (A), (B), or (C) may be taken under subsection (a)(1), 
        under section 202(d)(1)(G), or under section 
        202(d)(2)(D) only to the extent the cumulative impact 
        of such action does not exceed the amount necessary to 
        prevent or remedy the serious injury.
          (3) No action may be taken under this section which 
        would increase a rate of duty to (or impose a rate) 
        which is more than 50 percent ad valorem above the rate 
        (if any) existing at the time the action is taken.
          (4) Any action taken under this section proclaiming a 
        quantitative restriction shall permit the importation 
        of a quantity or value of the article which is not less 
        than the average quantity or value of such article 
        entered into the United States in the most recent 3 
        years that are representative of imports of such 
        article and for which data are available, unless the 
        President finds that the importation of a different 
        quantity or value is clearly justified in order to 
        prevent or remedy the serious injury.
          (5) An action described in subsection (a)(3) (A), 
        (B), or (C) that has an effective period of more than 1 
        year shall be phased down at regular intervals during 
        the period in which the action is in effect.
          (6)(A) The suspension, pursuant to any action taken 
        under this section, of--
                  (i) subheadings 9802.00.60 or 9802.00.80 of 
                the Harmonized Tariff Schedule of the United 
                States with respect to an article; and
                  (ii) the designation of any article as an 
                eligible article for purposes of title V;
        shall be treated as an increase in duty.
          (B) No proclamation providing for a suspension 
        referred to in subparagraph (A) with respect to any 
        article may be made by the President, nor may any such 
        suspension be recommended by the Commission under 
        section 202(e), unless the Commission, in addition to 
        making an affirmative determination under section 
        202(b)(1), determines in the course of its 
        investigation under section 202(b) that the serious 
        injury, or threat thereof, substantially caused by 
        imports to the domestic industry producing a like or 
        directly competitive article results from, as the case 
        may be--
                  (i) the application of subheadings 9802.00.60 
                or 9802.00.80 of the Harmonized Tariff Schedule 
                of the United States; or
                  (ii) the designation of the article as an 
                eligible article for the purposes of title V.
          (7)(A) If an article was the subject of an action 
        under subparagraph (A), (B), (C), or (E) of subsection 
        (a)(3), no new action may be taken under any of those 
        subparagraphs with respect to such article for--
                  (i) a period beginning on the date on which 
                the previous action terminates that is equal to 
                the period in which the previous action was in 
                effect, or
                  (ii) a period of 2 years beginning on the 
                date on which the previous action terminates,
        whichever is greater.
          (B) Notwithstanding subparagraph (A), if the previous 
        action under subparagraph (A), (B), (C), or (E) of 
        subsection (a)(3) with respect to an article was in 
        effect for a period of 180 days or less, the President 
        may take a new action under any of those subparagraphs 
        with respect to such article if--
                  (i) at least 1 year has elapsed since the 
                previous action went into effect; and
                  (ii) an action described in any of those 
                subparagraphs has not been taken with respect 
                to such article more than twice in the 5-year 
                period immediately preceding the date on which 
                the new action with respect to such article 
                first becomes effective.
    (f) Certain Agreements.--
          (1) If the President takes action under this section 
        other than the implementation of agreements of the type 
        described in subsection (a)(3)(E), the President may, 
        after such action takes effect, negotiate agreements of 
        the type described in subsection (a)(3)(E), and may, 
        after such agreements take effect, suspend or 
        terminate, in whole or in part, any action previously 
        taken.
          (2) If an agreement implemented under subsection 
        (a)(3)(E) is not effective, the President may, 
        consistent with the limitations contained in subsection 
        (e), take additional action under subsection (a).
    (g) Regulations.--
          (1) The President shall by regulation provide for the 
        efficient and fair administration of all actions taken 
        for the purpose of providing import relief under this 
        chapter.
          (2) In order to carry out an international agreement 
        concluded under this chapter, the President may 
        prescribe regulations governing the entry or withdrawal 
        from warehouse of articles covered by such agreement. 
        In addition, in order to carry out any agreement of the 
        type described in subsection (a)(3)(E) that is 
        concluded under this chapter with one or more countries 
        accounting for a major part of United States imports of 
        the article covered by such agreement, including 
        imports into a major geographic area of the United 
        States, the President may issue regulations governing 
        the entry or withdrawal from warehouse of like articles 
        which are the product of countries not parties to such 
        agreement.
          (3) Regulations prescribed under this subsection 
        shall, to the extent practicable and consistent with 
        efficient and fair administration, insure against 
        inequitable sharing of imports by a relatively small 
        number of the larger importers.

SEC. 204. MONITORING, MODIFICATION, AND TERMINATION OF ACTION.

    (a) Monitoring.--
          (1) So long as any action taken under section 203 
        remains in effect, the Commission shall monitor 
        developments with respect to the domestic industry, 
        including the progress and specific efforts made by 
        workers and firms in the domestic industry to make a 
        positive adjustment to import competition.
          (2) If the initial period during which the action 
        taken under section 203 is in effect exceeds 3 years, 
        or if an extension of such action exceeds 3 years, the 
        Commission shall submit a report on the results of the 
        monitoring under paragraph (1) to the President and to 
        the Congress not later than the date that is the mid-
        point of the initial period, and of each such 
        extension, during which the action is in effect.
          (3) In the course of preparing each report under 
        paragraph (2), the Commission shall hold a hearing at 
        which interested persons shall be given a reasonable 
        opportunity to be present, to produce evidence, and to 
        be heard.
          (4) Upon request of the President, the Commission 
        shall advise the President of its judgment as to the 
        probable economic effect on the industry concerned of 
        any reduction, modification, or termination of the 
        action taken under section 203 which is under 
        consideration.
    (b) Reduction, Modification, and Termination of Action.--
          (1) Action taken under section 203 may be reduced, 
        modified, or terminated by the President (but not 
        before the President receives the report required under 
        subsection (a)(2)(A)) if the President--
                  (A) after taking into account any report or 
                advice submitted by the Commission under 
                subsection (a) and after seeking the advice of 
                the Secretary of Commerce and the Secretary of 
                Labor, determines, on the basis that either--
                          (i) the domestic industry has not 
                        made adequate efforts to make a 
                        positive adjustment to import 
                        competition, or
                          (ii) the effectiveness of the action 
                        taken under section 203 has been 
                        impaired by changed economic 
                        circumstances,
                that changed circumstances warrant such 
                reduction, or termination; or
                  (B) determines, after a majority of the 
                representatives of the domestic industry 
                submits to the President a petition requesting 
                such reduction, modification, or termination on 
                such basis, that the domestic industry has made 
                a positive adjustment to import competition.
          (2) Notwithstanding paragraph (1), the President is 
        authorized to take such additional action under section 
        203 as may be necessary to eliminate any circumvention 
        of any action previously taken under such section.
          (3) Notwithstanding paragraph (1), the President may, 
        after receipt of a Commission determination under 
        section 129(a)(4) of the Uruguay Round Agreements Act 
        and consulting with the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate, reduce, modify, or terminate 
        action taken under section 203.
    (c) Extension of Action.--
          (1) Upon request of the President, or upon petition 
        on behalf of the industry concerned filed with the 
        Commission not earlier than the date which is 9 months, 
        and not later than the date which is 6 months, before 
        the date any action taken under section 203 is to 
        terminate, the Commission shall investigate to 
        determine whether action under section 203 continues to 
        be necessary to prevent or remedy serious injury and 
        whether there is evidence that the industry is making a 
        positive adjustment to import competition.
          (2) The Commission shall publish notice of the 
        commencement of any proceeding under this subsection in 
        the Federal Register and shall, within a reasonable 
        time thereafter, hold a public hearing at which the 
        Commission shall afford interested parties and 
        consumers an opportunity to be present, to present 
        evidence, and to respond to the presentations of other 
        parties and consumers, and otherwise to be heard.
          (3) The Commission shall transmit to the President a 
        report on its investigation and determination under 
        this subsection not later than 60 days before the 
        action under section 203 is to terminate, unless the 
        President specifies a different date.
    (d) Evaluation of Effectiveness of Action.--
          (1) After any action taken under section 203 has 
        terminated, the Commission shall evaluate the 
        effectiveness of the actions in facilitating positive 
        adjustment by the domestic industry to import 
        competition, consistent with the reasons set out by the 
        President in the report submitted to the Congress under 
        section 203(b).
          (2) During the course of the evaluation conducted 
        under paragraph (1), the Commission shall, after 
        reasonable public notice, hold a hearing on the 
        effectiveness of the action. All interested persons 
        shall have the opportunity to attend such hearing and 
        to present evidence or testimony at such hearing.
          (3) A report on the evaluation made under paragraph 
        (1) and the hearings held under paragraph (2) shall be 
        submitted by the Commission to the President and to the 
        Congress by no later than the 180th day after the day 
        on which the actions taken under section 203 
        terminated.
    (e) Other Provisions.--
          (1) Action by the President under this chapter may be 
        taken without regard to the provisions of section 
        126(a) of this Act but only after consideration of the 
        relation of such actions to the international 
        obligations of the United States.
          (2) If the Commission treats as the domestic industry 
        production located in a major geographic area of the 
        United States under section 202(c)(4)(C), then the 
        President shall take into account the geographic 
        concentration of domestic production and of imports in 
        that area in taking any action authorized under 
        paragraph (1).

  E. RELIEF FROM MARKET DISRUPTION BY IMPORTS FROM COMMUNIST COUNTRIES


            Section 406 of the Trade Act of 1974, as amended


 [19 U.S.C. 2436; P.L. 93-618, as amended by Reorganization Plan No. 3 
                 of 1979 P.L. 100-418 and P.L. 106-36]

SEC. 406. MARKET DISRUPTION.

    (a)(1) Upon the filing of a petition by an entity described 
in section 202(a), upon request of the President or the United 
States Trade Representative, upon resolution of either the 
Committee on Ways and Means of the House of Representatives or 
the Committee on Finance of the Senate, or on its own motion, 
the International Trade Commission (hereafter in this section 
referred to as the ``Commission'') shall promptly make an 
investigation to determine, with respect to imports of an 
article which is the product of a Communist country, whether 
market disruption exists with respect to an article produced by 
a domestic industry.
    (2) The provisions of subsections (a)(3), (b)(4), and 
(c)(4) of section 202 shall apply with respect to 
investigations by the Commission under paragraph (1).
    (3) The Commission shall report to the President its 
determination with respect to each investigation under 
paragraph (1) and the basis therefor and shall include in each 
report any dissenting or separate views. If the Commission 
finds, as a result of its investigation, that market disruption 
exists with respect to an article produced by a domestic 
industry, it shall find the amount of the increase in, or 
imposition of, any duty or other import restriction on such 
article which is necessary to prevent or remedy such market 
disruption and shall include such finding in its report to the 
President. The Commission shall furnish to the President a 
transcript of the hearings and any briefs which may have been 
submitted in connection with each investigation.
    (4) The report of the Commission of its determination with 
respect to an investigation under paragraph (1) shall be made 
at the earliest practicable time, but not later than 3 months 
after the date on which the petition is filed (or the date on 
which the request or resolution is received or the motion is 
adopted, as the case may be). Upon making such report to the 
President, the Commission shall also promptly make public such 
report (with the exception of information which the Commission 
determines to be confidential) and shall cause a summary 
thereof to be published in the Federal Register.
    (b) With respect to any affirmative determination of the 
Commission under subsection (a)--
          (1) such determination shall be treated as an 
        affirmative determination made under section 201(b) of 
        this Act (as in effect on the day before the date of 
        the enactment of the Omnibus Trade and Competitiveness 
        Act of 1988); and
          (2) sections 202 and 203 of this Act (as in effect on 
        the day before the date of the enactment of such Act of 
        1988), rather than the provisions of chapter 1 of title 
        II of this Act as amended by section 1401 of such Act 
        of 1988, shall apply with respect to the taking of 
        subsequent action, if any, by the President in response 
        to such affirmative determination;
except that--
          (A) the President may take action under such sections 
        202 and 203 only with respect to imports from the 
        country or countries involved of the article with 
        respect to which the affirmative determination was 
        made; and
          (B) if such action consists of, or includes, an 
        orderly marketing agreement, such agreement shall be 
        entered into within 60 days after the import relief 
        determination date.
    (c) If, at any time, the President finds that there are 
reasonable grounds to believe, with respect to imports of an 
article which is the product of a Communist country, that 
market disruption exists with respect to an article produced by 
a domestic industry, he shall request the Commission to 
initiate an investigation under subsection (a). If the 
President further finds that emergency action is necessary, he 
may take action under sections 202 and 203 referred to in 
subsection (b) as if an affirmative determination of the 
Commission had been made under subsection (a). Any action taken 
by the President under the preceding sentence shall cease to 
apply (1) if a negative determination is made by the Commission 
under subsection (a) with respect to imports of such article, 
on the day on which the Commission's report of such 
determination is submitted to the President, or (2) if an 
affirmative determination is made by the Commission under 
subsection (a) with respect to imports of such article, on the 
day on which the action was taken by the President pursuant to 
such determination becomes effective.
    (d)(1) A petition may be filed with the President by an 
entity described in section 202(a) requesting the President to 
initiate consultations provided for by the safeguard 
arrangements of any agreement entered into under section 405 
with respect to imports of an article which is the product of 
the country which is the other party to such agreement.
    (2) If the President determines that there are reasonable 
grounds to believe, with respect to imports of such article, 
that market disruption exists with respect to an article 
produced by a domestic industry, he shall initiate 
consultations with such country with respect to such imports.
    (e) For purposes of this section--
          (1) The term ``Communist country'' means any country 
        dominated or controlled by communism.
          (2)(A) Market disruption exists within a domestic 
        industry whenever imports of an article, like or 
        directly competitive with an article produced by such 
        domestic industry, are increasing rapidly, either 
        absolutely or relatively, so as to be a significant 
        cause of material injury, or threat thereof, to such 
        domestic industry.
          (B) For purposes of subparagraph (A):
                  (i) Imports of an article shall be considered 
                to be increasing rapidly if there has been a 
                significant increase in such imports (either 
                actual or relative to domestic production) 
                during a recent period of time.
                  (ii) The term ``significant cause'' refers to 
                a cause which contributes significantly to the 
                material injury of the domestic industry, but 
                need not be equal to or greater than any other 
                cause.
          (C) The Commission, in determining whether market 
        disruption exists, shall consider, among other 
        factors--
                  (i) the volume of imports of the merchandise 
                which is the subject of the investigation;
                  (ii) the effect of imports of the merchandise 
                on prices in the United States for like or 
                directly competitive articles;
                  (iii) the impact of imports of such 
                merchandise on domestic producers of like or 
                directly competitive articles; and
                  (iv) evidence of disruptive pricing 
                practices, or other efforts to unfairly manage 
                trade patterns.

F. RELIEF FROM MARKET DISRUPTION BY IMPORTS FROM THE PEOPLE'S REPUBLIC 
                                OF CHINA


    Section 421-423 of the Trade Agreements Act of 1974, as amended


[19 U.S.C. 2451, 2451a, 2451b; P.L. 93-618, as amended by P.L. 106-286]

CHAPTER 2--RELIEF FROM MARKET DISRUPTION TO INDUSTRIES AND DIVERSION OF 
                    TRADE TO THE UNITED STATES MARKET

SEC. 421. ACTION TO ADDRESS MARKET DISRUPTION.

    (a) Presidential Action.--If a product of the People's 
Republic of China is being imported into the United States in 
such increased quantities or under such conditions as to cause 
or threaten to cause market disruption to the domestic 
producers of a like or directly competitive product, the 
President shall, in accordance with the provisions of this 
section, proclaim increased duties or other import restrictions 
with respect to such product, to the extent and for such period 
as the President considers necessary to prevent or remedy the 
market disruption.
    (b) Intiation of an Investigation.--(1) Upon the filing of 
a petition by an entity described in section 202(a) of the 
Trade Act of 1974 (19 U.S.C. 2252(a)), upon the request of the 
President or the United States Trade Representative (in this 
subtitle referred to as the ``Trade Representative''), upon 
resolution of either the Committee on Ways and Means of the 
House of Representatives, or the Committee on Finance of the 
Senate (in this subtitle referred to as the ``Committees'') or 
on its own motion, the United States International Trade 
Commission (in this subtitle referred to as the ``Commission'') 
shall promptly make an investigation to determine whether 
products of the People's Republic of China are being imported 
into the United States in such increased quantities or under 
such conditions as to cause or threaten to cause market 
disruption to the domestic producers of like or directly 
competitive products.
    (2) The limitations on investigations set forth in section 
202(h)(1) of the Trade Act of 1974 (19 U.S.C. 2252(h)(1)) shall 
apply to investigations conducted under this section.
    (3) The provisions of subsections (a)(8) and (i) of section 
202 of the Trade Act of 1974 (19 U.S.C. 2252(a)(8) and (i)), 
relating to treatment of confidential business information, 
shall apply to investigations conducted under this section.
    (4) Whenever a petition is filed, or a request or 
resolution is received, under this subsection, the Commission 
shall transmit a copy thereof to the President, the Trade 
Representative, the Committee on Ways and Means of the House of 
Representatives, and the Committee on Finance of the Senate, 
except that in the case of confidential business information, 
the copy may include only nonconfidential summaries of such 
information.
    (5) The Commission shall publish notice of the commencement 
of any proceeding under this subsection in the Federal Register 
and shall, within a reasonable time thereafter, hold public 
hearings at which the Commission shall afford interested 
parties an opportunity to be present, to present evidence, to 
respond to the presentations of other parties, and otherwise to 
be heard.
    (c) Market Disruption.--(1) For purposes of this section, 
market disruption exists whenever imports of an article like or 
directly competitive with an article produced by a domestic 
industry are increasing rapidly, either absolutely or 
relatively, so as to be a significant cause of material injury, 
or threat of material injury, to the domestic industry.
    (2) For purposes of paragraph (1), the term ``significant 
cause'' refers to a cause which contributes significantly to 
the material injury of the domestic industry, but need not be 
equal to or greater than any other cause.
    (d) Factors in Determination.--In determining whether 
market disruption exists, the Commission shall consider 
objective factors, including--
          (1) the volume of imports of the product which is the 
        subject of the investigation;
          (2) the effect of imports of such product on prices 
        in the United States for like or directly competitive 
        articles.
          (3) the effect of imports of such product on the 
        domestic industry producing like or directly 
        competitive articles.
The presence or absence of any factor under paragraph (1), (2), 
or (3) is not necessarily dispositive of whether market 
disruption exists.
    (e) Time for Commission Determinations.--The Commission 
shall make and transmit to the President and the Trade 
Representative its determination under subsection (b)(1) at the 
earliest practicable time, but in no case later than 60 days 
(or 90 days in the case of a petition requesting relief under 
subsection (i)) after the date on which the petition is filed, 
the request or resolution is received, or the motion is 
adopted, under subsection (b). If the Commissioners voting are 
equally divided with respect to its determination, then the 
determination agreed upon by either group of Commissioners may 
be considered by the President and the Trade Representative as 
the determination of the Commission.
    (f) Recommendations of Commission on Proposed Remedies.--If 
the Commission makes an affirmative determination under 
subsection (b), or a determination which the President or the 
Trade Representative may consider as affirmative under 
subsection (e), the Commission shall propose the amount of 
increase in, or imposition of, any duty or other import 
restrictions necessary to prevent or remedy the market 
disruption. Only those members of the Commission who agreed to 
the affirmative determination under subsection (b) are eligible 
to vote on the proposed action to prevent or remedy market 
disruption. Members of the Commission who did not agree to the 
affirmative determination may submit, in the report required 
under subsection (g), separate views regarding what action, if 
any, should be taken to prevent or remedy market disruption.
    (g) Report by Commission.--(1) Not later than 20 days after 
a determination under subsection (b) is made, the Commission 
shall submit a report to the president and the Trade 
Representative.
    (2) The Commission shall include in the report required 
under paragraph (1) the following:
          (A) The determination made under subsection (b) and 
        an explanation of the basis for the determination.
          (B) If the determination under subsection (b) is 
        affirmative, or may be considered by the President of 
        the Trade Representative as affirmative under 
        subsection (e), the recommendations of the Commission 
        on proposed remedies under subsection (f) and an 
        explanation of the basis for each recommendation.
          (C) Any dissenting or separate views by members of 
        the Commission regarding the determination and any 
        recommendation referred to in subparagraphs (A) and 
        (B).
          (D) A description of--
                  (i) the short- and long-term effects that 
                implementation of the action recommended under 
                subsection (f) is likely to have on the 
                petitioning domestic industry, on other 
                domestic industries, and on consumers; and
                  (ii) the short- and long-term effects of not 
                taking the recommended action on the 
                petitioning domestic industry, its workers, and 
                the communities where production facilities of 
                such industry are located, and on other 
                domestic industries.
    (3) The Commission, after submitting a report to the 
President under paragraph (1), shall promptly make it available 
to the public (but shall not include confidential business 
information) and cause a summary thereof to be published in the 
Federal Register.
    (h) Opportunity To Present Views and Evidence on Proposed 
Measure and Recommendation to the President.--(1) Within 20 
days after receipt of the Commission's report under subsection 
(g) (or 15 days in the case of an affirmative preliminary 
determination under subsection (i)(1)(B)), the Trade 
Representative shall publish in the Federal Register notice of 
any measure proposed by the Trade Representative to be taken 
pursuant to subsection (a) and of the opportunity, including a 
public hearing, if requested, for importers, exporters, and 
other interested parties to submit their views and evidence on 
the appropriateness of the proposed measure and whether it 
would be in the public interest.
    (2) Within 55 days after receipt of the report under 
subsection (g) (or 35 days in the case of an affirmative 
preliminary determination under subsection (i)(1)(B)), The 
Trade Representative, taking into account the views and 
evidence received under paragraph (1) on the measure proposed 
by the Trade Representative, shall make a recommendation to the 
President concerning what action, if any, to take to prevent or 
remedy the market disruption.
    (i) Critical Circumstances.--(1) When a petition filed 
under subsection (b) alleges that critical circumstances exist 
and requests that provisional relief be provided under this 
subsection with respect to the product identified in the 
petition, the Commission shall, not later than 45 days after 
the petition containing the request is filed--
          (A) determine whether delay in taking action under 
        this section would cause damage to the relevant 
        domestic industry which would be difficult to repair; 
        and
          (B) if the determination under subparagraph (A) is 
        affirmative, make a preliminary determination of 
        whether imports of the product which is the subject of 
        the investigation have caused or threatened to cause 
        market disruption.
If the Commissioners voting are equally divided with respect to 
either of its determinations, then the determination agreed 
upon by either group of Commissioners may be Considered by the 
President and the Trade Representative as the determination of 
the Commission.
    (2) On the date on which the Commission completes its 
determinations under paragraph (1), the Commission shall 
transmit a report on the determinations to the President and 
the Trade Representative, including the reasons for its 
determinations. If the determinations under paragraph (1) are 
affirmative, or may be considered by the President or the Trade 
Representative as affirmative under paragraph (1), the 
Commission shall include in its report its recommendations on 
proposed provisional measures to be taken to prevent or remedy 
the market disruption. Only those members of the Commission who 
agreed to the affirmative determinations under paragraph (1) 
are eligible to vote on the proposed provisional measures to 
prevent or remedy market disruption. Members of the Commission 
who did not agree to the affirmative determinations may submit, 
in the report, dissenting or separate views regarding the 
determination and any recommendation of provisional measures 
referred to in this paragraph.
    (3) If the determinations under paragraph (1) are 
affirmative, or may be considered by the President or the Trade 
Representative as affirmative under paragraph (1), the Trade 
Representative shall, within 10 days after receipt of the 
Commission's report, determine the amount or extent of 
provisional relief that is necessary to prevent or remedy the 
market disruption and shall provide a recommendation to the 
President on what provisional measures, if any, to take.
    (4)(A) The President shall determine whether to provide 
provisional relief and proclaim such relief, if any, within 10 
days after receipt of the recommendation from the Trade 
Representative.
    (B) Such relief may take the form of--
          (i) the imposition of or increase in any duty;
          (ii) any modification, or imposition of any 
        quantitative restriction on the importation of any 
        article into the United States; or
          (iii) any combination of actions under clauses (i) 
        and (ii).
    (C) Any provisional action proclaimed by the President 
pursuant to a determination of critical circumstances shall 
remain in effect not more than 200 days.
    (D) Provisional relief shall cease to apply upon the 
effective date of relief proclaimed under subsection (a), upon 
a decision by the President not to provide such relief, or upon 
a negative determination by the Commission under subsection 
(b).
    (j) Agreements With the People's Republic of China.--(1) 
The Trade Representative is authorized to enter into agreements 
for the People's Republic of China to take such action as 
necessary to prevent or remedy market disruption, and should 
seek to conclude such agreement before the expiration of the 
60-days consultation period provided for under the product-
specific safeguard provision of the Protocol of Accession of 
the People's Republic of China to the WTO, which shall commence 
not later than 5 days after the Trade Representative receives 
an affirmative determination provided for in subsection (e) or 
a determination which the Trade Representative considers to be 
an affirmative determination pursuant to subsection (e).
    (2) If no agreement is reached with the People's Republic 
of china pursuant to consultations under paragraph (1), or if 
the President determines than an agreement reached pursuant to 
such consultations is not preventing or remedying them market 
disruption at issue, the President shall provide import relief 
in accordance with subsection (a).
    (k) Standard for Presidential Action.--(1) Within 15 days 
after receipt of a recommendation from the Trade Representative 
under subsection (h) on the appropriate action, if any, to take 
to prevent or remedy the market disruption, the President shall 
provide import relief for such industry pursuant to subsection 
(a), unless the President determines that provision of such 
relief is not in the national economic interest of the United 
States or, in extraordinary cases, that the taking of action 
pursuant to subsection (a) would cause serious harm to the 
national security of the United States.
    (2) The President may determine under paragraph (1) that 
providing import relief is not in the national economic 
interest of the United States only if the President finds that 
the taking of such action would have an adverse impact on the 
United States economy clearly greater than the benefits of such 
action
    (l) Publication of Decision and Reports.--The President's 
decision, including the reasons therefor and the scope and 
duration of any action taken, shall be published in the Federal 
Register.
    (2) The Commission shall promptly make public any report 
transmitted under this section, but shall not make public any 
information which the Commission determines to be confidential, 
and shall publish notice of such report in the Federal 
Register.
    (m) Effective Date of Relief.--Import relief under this 
section shall take effect not later than 15 days after the 
President's determination to provide such relief.
    (n) Modifications of Relief.--(1) At any time after the end 
of the 6-month period beginning on the date on which relief 
under subsection (m) first takes effect, the President may 
request that the Commission provide a report on the Probable 
effect of the modification, reduction, or termination of the 
relief provided on the relevant industry. The Commission shall 
transmit such report to the President within 60 days of the 
request.
    (2) The President may, after receiving a report from the 
Commission under paragraph (1), take such action to modify, 
reduce, or terminate relief that the President determines is 
necessary to continue to prevent or remedy the market 
disruption at issue.
          (3) Upon the granting of relief under subsection (k), 
        the Commission shall collect such data as is necessary 
        to allow it to respond rapidly to a request by the 
        President under paragraph (1).
          (o) Extension of Action.--(1) Upon request of the 
        President or upon petition on behalf of the industry 
        concerned filed with the Commission not earlier than 
        the date which is 9 months, and not later than the date 
        which is 6 months, before the date any relief provided 
        under subsection (k) is to terminate, the Commission 
        shall investigate to determine whether action under 
        this section continues to be necessary to prevent or 
        remedy market disruption.
          (2) The Commission shall publish notice of the 
        commencement of any proceeding under this subsection in 
        the Federal register and shall, within a reasonable 
        time thereafter, hold a public hearing at which the 
        Commission shall afford interested parties and 
        consumers an opportunity to be present, to present 
        evidence, and to respond to the presentations of other 
        parties and consumers, and otherwise to be heard.
          (3) The Commission shall transmit to the President a 
        report on its investigation and determination under 
        this subsection not later than 60 days before the 
        action under subsection (m) is to terminate.
          (4) The President, after receiving an affirmative 
        determination from the Commission under paragraph (3), 
        may extend the effective period of any action under 
        this section if the President determines that the 
        action continues to be necessary to prevent or remedy 
        the market disruption.

SEC. 422. ACTION TO RESPONSE TO TRADE DIVERSION.

    (a) Monitoring by Customs Service.--In any case in which a 
WTO member other than the United States requests consultations 
with the People's Republic of China under the product-specific 
safeguard provision of the Protocol of Accession of the 
People's Republic of China to the World Trade Organization, the 
Trade Representative shall inform the United States Customs 
Service, which shall monitor imports into the United States of 
those products of Chinese origin that are the subject of the 
consultation request. Data from such monitoring shall promptly 
be made available to the Commission upon request by the 
Commission.
    (b) Initiation of Investigation.--Upon the filing of a 
petition by an entity described in section 202(a) of the Trade 
Act of 1974, upon the request of the President or the Trade 
Representative, upon resolution of either of the Committees, or 
on its own motion, the Commission shall promptly make an 
investigation to determine whether an action described in 
subsection (c) has caused, or threatens to cause, a significant 
diversion of trade into the domestic market of the United 
States.
    (2) The Commission shall publish notice of the commencement 
of any proceeding under this subsection in the Federal Register 
and shall, within a reasonable time thereafter, hold public 
hearings at which the Commission shall afford interested 
parties an opportunity to be present, to present evidence, to 
respond to the presentations of other parties, and otherwise to 
be hear.
    (3) The provisions of subsection (a)(8) and (i) of section 
202 of the Trade Act of 1974 (19 U.S.C. 2252(a)(8) and (i)), 
relating to treatment of confidential business information, 
shall apply to investigations conducted under this section.
    (c) Actions Described.--An action is described in this 
subsection if it is an action--
          (1) by the People's Republic of China to prevent or 
        remedy market disruption in a WTO member other than the 
        United States;
          (2) by a WTO member other than the United States to 
        withdraw concessions under the WTO Agreement or 
        otherwise to limit imports to prevent or remedy market 
        disruption;
          (3) by a WTO member other than the United States to 
        apply a provisional safeguard within the meaning of the 
        product-specific safeguard provison of the Protocol of 
        Accession of the People's Republic of China to the WTO; 
        or
          (4) any combination of actions described in 
        paragraphs (1) through (3).
    (d) Basic for Determination of Significant Diversion.--(1) 
In determining whether significant diversion or the treat 
thereof exists for purposes of this section, the Commission 
shall take into account, to the extent such evidence is 
reasonably available--
          (A) the monitoring conducted under subsection (A);
          (B) the actual or imminent increase in United States 
        market share held by such imports from the People's 
        Republic of China;
          (C) the actual or imminent increase in volume of such 
        imports into the United States;
          (D) the nature and extent of the action taken or 
        proposed by the WTO member concerned;
          (E) the extent of exports from the People's Republic 
        of China to that WTO member and to the United States;
          (F) the actual or imminent changes in exports to that 
        WTO member due to the action taken or proposed
          (G) the actual or imminent diversion of exports from 
        the People's Republic of China to countries other than 
        the Unites States;
          (H) cyclical or seasonal trend in import volumes into 
        the United States of the products at issue; and
          (I) conditions of demand and supply in the United 
        States market for the products at issue.
The presence or absence of any factor under any of 
subparagraphs (A) through (I) is not necessarily dispositive of 
whether a significant diversion of trade or the treat thereof 
exists.
      (2) For purposes of making its determination, the 
Commission shall examine changes in imports into the United 
States from the People's Republic of China since the time that 
the WTO member commenced the investigation that led to a 
request for consultations described in subsection (a).
      (3) If more than one action by a WTO member or WTO 
members against a particular product is identified in the 
petition, request, or resolution under subsection (b) or during 
the investigation, the Commission may cumulatively assess the 
actual or likely effects of such actions jointly in determining 
whether a significant diversion of trade or threat thereof 
exists.
      (e) Commission Determination; Agreement Authority.--(1) 
The Commission shall make and transmit to the President and the 
trade Representative its determination under subsection (b) at 
the earliest practicable time, but in no case later than 45 
days after the date on which the petition is filed, the request 
or resolution is received, or the motion is adopted, under 
subsection (b). If the Commissioners voting are equally divided 
with respect to its determination, then the determination 
agreed upon by either group of Commissioners may be considered 
by the President and the Trade Representative as the 
determination of the Commission.
      (2) The Trade Representative is authorized to enter into 
agreements with the People's Republic of China or the other WTO 
members concerned to take such action as necessary to prevent 
or remedy significant trade diversion or treat thereof into the 
domestic market of the United States, and should seek to 
conclude such agreements before the expiration of the 60-day 
consultation period provided for under the product-specific 
safeguard provision of the Protocol of Accession of the 
People's Republic of China to the WTO, which shall commence not 
later than 5 days after the Trade Representative receives an 
affirmative determination provided for in paragraph (1) or a 
determination which the Trade Representative considers to be an 
affirmative determination pursuant to paragraph (1).
      (3) Report by Commission.--
          (A) Not later than 10 days after a determination 
        under subsection (b), is made, the Commission shall 
        transmit a report to the President and the Trade 
        Representative.
          (B) The Commission shall include in the report 
        required under subparagraph (A) the following:
                  (i) The determination made under subsection 
                (b) and an explanation of the basis for the 
                determination.
                  (ii) If the determination under subsection 
                (b) is affirmative, or may be considered by the 
                President or the Trade Representative as 
                affirmative under subsection (e)(1), the 
                recommendations of the Commission on increased 
                tariffs or other import restrictions to be 
                imposed to prevent or remedy the trade 
                diversion or threat thereof, and explanations 
                of the bases for such recommendations. Only 
                those members of the Commission who agreed to 
                the affirmative determination under subsection 
                (b) are eligible to vote on the proposed action 
                to prevent or remedy the trade diversion or 
                threat thereof.
                  (iii) Any dissenting or separate views by 
                members of the Commission regarding the 
                determination and any recommendation referred 
                to in clauses (i) and (ii).
                  (iv) A description of--
                          (I) The short- and long-term effects 
                        that implementation of the action 
                        recommended under clause (ii) is likely 
                        to have on the petitioning domestic 
                        industry, on other domestic industries, 
                        and on consumers; and
                          (II) the short- and long-term effects 
                        of not taking the recommended action on 
                        the petitioning domestic industry, its 
                        workers and the communities where 
                        production facilities of such industry 
                        are located, and on other domestic 
                        industries.
          (C) The Commission, after submitting a report to the 
        President under subparagraph (A), shall promptly make 
        it available to the public (with the exception of 
        confidential business information) and cause a summary 
        thereof to be published in the Federal Register.
      (f) Public Comment.--If consultations fail to lead to an 
agreement with the People's Republic of China or the WTO member 
concerned within 60 days, the Trade Representative shall 
promptly publish notice in the Federal Register of any proposed 
action to prevent or remedy the trade diversion, and provide an 
opportunity for interested persons to present views and 
evidence on whether the proposed action is in the public 
interest.
      (g) Recommendation to the President.--Within 20 days 
after the end of consultations pursuant to subsection (e), the 
Trade Representative shall make a recommendation to the 
President on what action, if any, should be taken to prevent or 
remedy the trade diversion or threat thereof.
      (h) Presidential Action.--Within 20 days after receipt of 
the recommendation from the Trade Representative, the President 
shall determine what action to take to prevent or remedy the 
trade diversion or threat thereof.
      (i) Duration of Action.--Action taken under subsection 
(h) shall be terminated not later than 30 days after expiration 
of the action taken by the WTO member or members involved 
against imports from the People's Republic of China.
      (j) Review of Circumstances.--The Commission shall review 
the continued need for action taken under subsection (h) if the 
WTO member of members involved notify the Committee of 
Safeguards of the WTO of any modification in the action taken 
by them against the People's Republic of China pursuant to 
consultation referred to in subsection (a). The Commission 
shall, not later than 60 days after such notification, 
determine whether a significant diversion of trade continues to 
exist and report its determination to the President. The 
President shall determine, within 15 days after receiving the 
Commission's report, whether to modify, withdraw, or keep in 
place the action taken under subsection (h).

SEC. 423. REGULATIONS; TERMINATION OF PROVISION.

      (a) To Carry Out Restrictions and Monitoring.--The 
President shall by regulation provide for the efficient and 
fair administration of any restriction proclaimed pursuant to 
the subtitle and to provide for effective monitoring of imports 
under section 422(a).
      (b) To Carry Out Agreements.--To carry out an agreement 
concluded pursuant to consultations under section 421(j) or 
422(e)(2), the President is authorized to prescribe regulations 
governing the entry or withdrawal from warehouse of articles 
covered by such agreement.
      (c) Termination Date.--This subtitle and any regulations 
issued under this subtitle shall cease to be effective 12 years 
after the date of entry into force of the Protocol of Accession 
of the People's Republic of China to the WTO.

                G. AUTHORITY TO AUCTION IMPORT LICENSES


            Section 1102 of the Trade Agreements Act of 1979


[19 U.S.C. 2581, P.L. 96-39, as amended by P.L. 100-418, P.L. 105-220, 
              P.L. 105-277, P.L. 106-36, and P.L. 106-113]

SEC. 1102. AUCTION OF IMPORT LICENSES.

    (a) In General.--Notwithstanding any other provision of 
law, the President may sell import licenses at public auction 
under such terms and conditions as he deems appropriate. 
Regulations prescribed under this subsection shall, to the 
extent practicable and consistent with efficient and fair 
administration, insure against inequitable sharing of imports 
by a relatively small number of the larger importers.
    (b) Definition of Import License.--For purposes of this 
section, the term ``import license'' means any documentation 
used to administer a quantitative restriction imposed or 
modified after the date of enactment of this Act under--
          (1) section 125, 203, 301, or 406 of the Trade Act of 
        1974 (19 U.S.C. 2135, 2253, 2411, or 2436),
          (2) the International Emergency Economic Powers Act 
        (50 U.S.C. App. 1701-1706),
          (3) authority under the notes of the Harmonized 
        Tariff Schedule of the United States, but not including 
        any quantitative restriction imposed under section 22 
        of the Agriculture Adjustment Act of 1934 (7 U.S.C. 
        624),
          (4) the Trading With the Enemy Act (50 U.S.C. App. 1-
        44),
          (5) section 204 of the Agricultural Act of 1956 (7 
        U.S.C. 1854) other than for meat or meat products, or
          (6) any Act enacted explicitly for the purpose of 
        implementing any international agreement to which the 
        United States is a party, including such agreements 
        relating to commodities, but not including any 
        agreement relating to cheese or dairy products.

                     H. TRADE ADJUSTMENT ASSISTANCE


   Chapters 2, 3, 4, and 5 of Title II of the Trade Act of 1974, as 
                                amended


 [19 U.S.C. 2271 et seq.; P.L. 93-618, as amended by P.L. 96-417, P.L. 
97-35, P.L. 98-120, P.L. 98-369, P.L. 99-107, P.L. 99-155, P.L. 99-181, 
  P.L. 99-189, P.L. 99-272, P.L. 100-418, P.L. 100-647, P.L. 101-382, 
  P.L. 102-318, P.L. 103-66, and P.L. 103-182, P.L. 105-220, P.L. 105-
                  277, P.L. 106-36, and P.L. 106-113]

              Chapter 2--Adjustment Assistance for Workers


               Subchapter A--Petitions and Determinations


SEC. 221. PETITIONS.

    (a) A petition for certification of eligibility to apply 
for adjustment assistance under this subchapter may be filed 
with the Secretary of Labor (hereinafter in this chapter 
referred to as the ``Secretary'') by a group of workers 
(including workers in any agricultural firm or subdivision of 
an agricultural firm) or by their certified or recognized union 
or other duly authorized representative. Upon receipt of the 
petition, the Secretary shall promptly publish notice in the 
Federal Register that he has received the petition and 
initiated an investigation.
    (b) If the petitioner, or any other person found by the 
Secretary to have a substantial interest in the proceedings, 
submits not later than 10 days after the date of the 
Secretary's publication under subsection (a) a request for a 
hearing, the Secretary shall provide for a public hearing and 
afford such interested persons an opportunity to be present, to 
produce evidence, and to be heard.

SEC. 222. GROUP ELIGIBILITY REQUIREMENTS.

    (a) The Secretary shall certify a group of workers 
(including workers in any agricultural firm or subdivision of 
an agricultural firm) as eligible to apply for adjustment 
assistance under this subchapter if he determines--
          (1) that a significant number or proportion of the 
        workers in such workers' firm or an appropriate 
        subdivision of the firm have become totally or 
        partially separated, or are threatened to become 
        totally or partially separated,
          (2) that sales or production, or both, of such firm 
        or subdivision have decreased absolutely, and
          (3) that increases of imports of articles like or 
        directly competitive with articles produced by such 
        workers' firm or an appropriate subdivision thereof 
        contributed importantly to such total or partial 
        separation, or threat thereof, and to such decline in 
        sales or production.
    (b) For purposes of subsection (a)(3)--
          (1) The term ``contributed importantly'' means a 
        cause which is important but not necessarily more 
        important than any other cause.
          (2)(A) Any firm, or appropriate subdivision of a 
        firm, that engages in exploration or drilling for oil 
        or natural gas shall be considered to be a firm 
        producing oil or natural gas.
          (B) Any firm, or appropriate subdivision of a firm, 
        that engages in exploration or drilling for oil or 
        natural gas, or otherwise produces oil or natural gas, 
        shall be considered to be producing articles directly 
        competitive with imports of oil and with imports of 
        natural gas.

SEC. 223. DETERMINATIONS BY SECRETARY OF LABOR.

    (a) As soon as possible after the date on which a petition 
is filed under section 221, but in any event not later than 60 
days after that date, the Secretary shall determine whether the 
petitioning group meets the requirements of section 222 and 
shall issue a certification of eligibility to apply for 
assistance under this subchapter covering workers in any group 
which meets such requirements. Each certification shall specify 
the date on which the total or partial separation began or 
threatened to begin.
    (b) A certification under this section shall not apply to 
any worker whose last total or partial separation from the firm 
or appropriate subdivision of the firm before his application 
under section 231 occurred--
          (1) more than one year before the date of the 
        petition on which such certification was granted, or
          (2) more than 6 months before the effective date of 
        this chapter.
    (c) Upon reaching his determination on a petition, the 
Secretary shall promptly publish a summary of the determination 
in the Federal Register together with his reasons for making 
such determination.
    (d) Whenever the Secretary determines, with respect to any 
certification of eligibility of the workers of a firm or 
subdivision of the firm, that total or partial separations from 
such firm or subdivision are no longer attributable to the 
conditions specified in section 222, he shall terminate such 
certification and promptly have notice of such termination 
published in the Federal Register together with his reasons for 
making such determination. Such termination shall apply only 
with respect to total or partial separations occurring after 
the termination date specified by the Secretary.

SEC. 224. STUDY BY SECRETARY OF LABOR WHEN INTERNATIONAL TRADE 
                    COMMISSION BEGINS INVESTIGATION.

    (a) Whenever the International Trade Commission (hereafter 
referred to in this chapter as the ``Commission'') begins an 
investigation under section 202 with respect to an industry, 
the Commission shall immediately notify the Secretary of such 
investigation, and the Secretary shall immediately begin a 
study of--
          (1) the number of workers in the domestic industry 
        producing the like or directly competitive article who 
        have been or are likely to be certified as eligible for 
        adjustment assistance, and
          (2) the extent to which the adjustment of such 
        workers to the import competition may be facilitated 
        through the use of existing programs.
    (b) The report of the Secretary of the study under 
subsection (a) shall be made to the President not later than 15 
days after the day on which the Commission makes its report 
under section 202(f). Upon making his report to the President, 
the Secretary shall also promptly make it public (with the 
exception of information which the Secretary determines to be 
confidential) and shall have a summary of it published in the 
Federal Register.

SEC. 225. BENEFIT INFORMATION TO WORKERS.

    (a) The Secretary shall provide full information to workers 
about the benefit allowances, training, and other employment 
services available under this chapter and about the petition 
and application procedures, and the appropriate filing dates, 
for such allowances, training and services. The Secretary shall 
provide whatever assistance is necessary to enable groups of 
workers to prepare petitions or applications for program 
benefits. The Secretary shall make every effort to insure that 
cooperating State agencies fully comply with the agreements 
entered into under section 239(a) and shall periodically review 
such compliance. The Secretary shall inform the State Board for 
Vocational Education or equivalent agency and other public or 
private agencies, institutions, and employers, as appropriate, 
of each certification issued under section 223 and of 
projections, if available, of the needs for training under 
section 236 as a result of such certification.
    (b)(1) The Secretary shall provide written notice through 
the mail of the benefits available under this chapter to each 
worker whom the Secretary has reason to believe is covered by a 
certification made under subchapter A or subchapter D of this 
chapter--
          (A) at the time such certification is made, if the 
        worker was partially or totally separated from the 
        adversely affected employment before such 
        certification, or
          (B) at the time of the total or partial separation of 
        the worker from the adversely affected employment, if 
        subparagraph (A) does not apply.
    (2) The Secretary shall publish notice of the benefits 
available under this chapter to workers covered by each 
certification made under subchapter A or subchapter D in 
newspapers of general circulation in the areas in which such 
workers reside.

                     Subchapter B--Program Benefits


                 Part I--Trade Readjustment Allowances


SEC. 231. QUALIFYING REQUIREMENTS FOR WORKERS.

    (a) Payment of a trade readjustment allowance shall be made 
to an adversely affected worker covered by a certification 
under subchapter A who files an application for such allowance 
for any week of unemployment which begins more than 60 days 
after the date on which the petition that resulted in such 
certification was filed under section 221, if the following 
conditions are met:
          (1) Such worker's total or partial separation before 
        his application under this chapter occurred--
                  (A) on or after the date, as specified in the 
                certification under which he is covered, on 
                which total or partial separation began or 
                threatened to begin in the adversely affected 
                employment,
                  (B) before the expiration of the 2-year 
                period beginning on the date on which the 
                determination under section 223 was made, and
                  (C) before the termination date (if any) 
                determined pursuant to section 223(d).
          (2) Such worker had, in the 52-week period ending 
        with the week in which such total or partial separation 
        occurred, at least 26 weeks of employment at wages of 
        $30 or more a week in adversely affected employment 
        with a single firm or subdivision of a firm, or, if 
        data with respect to weeks of employment with a firm 
        are not available, equivalent amounts of employment 
        computed under regulations prescribed by the Secretary. 
        For the purpose of this paragraph, any week in which 
        such worker--
                  (A) is on the employer-authorized leave for 
                purposes of vacation, sickness, injury, 
                maternity, or inactive duty or active duty 
                military service for training,
                  (B) does not work because of a disability 
                that is compensable under a workmen's 
                compensation law or plan of a State or the 
                United States, 
                  (C) had his employment interrupted in order 
                to serve as a full-time representative of a 
                labor organization in such firm or subdivision, 
                or
                  (D) is on call-up for purposes of active duty 
                in a reserve status in the Armed Forces of the 
                United States, provided such active duty is 
                ``Federal service'' as defined in 5 U.S.C. 
                8521(a)(1),\18\
---------------------------------------------------------------------------
    \18\ Effective with respect to weeks beginning after August 1, 
1990.
---------------------------------------------------------------------------
        shall be treated as a week of employment at wages of 
        $30 or more, but not more than 7 weeks, in case of 
        weeks described in subparagraph (A) or (C), or both 
        (and not more than 26 weeks, in the case of weeks 
        described in subparagraph (B) or (D)), may be treated 
        as weeks of employment under this sentence.
          (3) Such worker--
                  (A) was entitled to (or would be entitled to 
                if he applied therefor) unemployment insurance 
                for a week within the benefit period (i) in 
                which such total or partial separation took 
                place, or (ii) which began (or would have 
                begun) by reason of the filing of a claim for 
                unemployment insurance by such worker after 
                such total or partial separation;
                  (B) has exhausted all rights to any 
                unemployment insurance to which he was entitled 
                (or would be entitled if he applied therefor); 
                and
                  (C) does not have an unexpired waiting period 
                applicable to him for any such unemployment 
                insurance.
          (4) Such worker, with respect to such week of 
        unemployment, would not be disqualified for extended 
        compensation payable under the Federal-State Extended 
        Unemployment Compensation Act of 1970 by reason of the 
        work acceptance and job search requirements in section 
        202(a)(3) of such Act.
          (5) Such worker--
                  (A) is enrolled in a training program 
                approved by the Secretary under section 236(a), 
                or
                  (B) has, after the date on which the worker 
                became totally separated, or partially 
                separated, from the adversely affected 
                employment, completed a training program 
                approved by the Secretary under section 236(a), 
                or
                  (C) has received a written statement 
                certified under subsection (c)(1) after the 
                date described in subparagraph (B).
    (b)(1) If--
          (A) the Secretary determines that--
                  (i) the adversely affected worker--
                          (I) has failed to begin participation 
                        in the training program the enrollment 
                        in which meets the requirement of 
                        subsection (a)(5), or
                          (II) has ceased to participate in 
                        such training program before completing 
                        such training program, and
                  (ii) there is no justifiable cause for such 
                failure or cessation, or
          (B) the certification made with respect to such 
        worker under subsection (c)(1) is revoked under 
        subsection (c)(2),
no trade readjustment allowance may be paid to the adversely 
affected worker under this part for the week in which such 
failure, cessation, or revocation occurred, or any succeeding 
week, until the adversely affected worker begins or resumes 
participation in a training program approved under section 
236(a).
    (2) The provisions of subsection (a)(5) and paragraph (1) 
shall not apply with respect to any week of unemployment which 
begins--
          (A) after the date that is 60 days after the date on 
        which the petition that results in the certification 
        that covers the worker is filed under section 221, and
          (B) before the first week following the week in which 
        such certification is made under subchapter (A).
    (c)(1)(A) If the Secretary finds that it is not feasible or 
appropriate to approve a training program for a worker under 
section 236(a), the Secretary shall submit to such worker a 
written statement certifying such finding.
    (B) If a State or State agency has an agreement with the 
Secretary under section 239 and the State or State agency finds 
that it is not feasible or appropriate to approve a training 
program for a worker pursuant to the requirements of section 
236(a), the State or State agency shall--
          (i) submit to such worker a written statement 
        certifying such finding, and
          (ii) submit to the Secretary a written statement 
        certifying such finding and the reasons for such 
        finding.
    (2)(A) If, after submitting to a worker a written statement 
certified under paragraph (1)(A), the Secretary finds that it 
is feasible or appropriate to approve a training program for 
such worker under section 236(a), the Secretary shall submit to 
such worker a written statement that revokes the certification 
made under paragraph (1)(A) with respect to such worker.
    (B) If, after submitting to a worker a written statement 
certified under paragraph (1)(B), a State or State agency finds 
that it is feasible or appropriate to approve a training 
program for such worker pursuant to the requirements of section 
236(a), the State or State agency shall submit to such worker, 
and to the Secretary, a written statement that revokes the 
certification made under paragraph (1)(B) with respect to such 
worker.
    (3) The Secretary shall submit to the Finance Committee of 
the Senate and to the Ways and Means Committee of the House of 
Representatives an annual report on the number of workers who 
received certifications under paragraph (1) during the 
preceding year and the number of certifications made under 
paragraph (1) that were revoked during the preceding year.

SEC. 232. WEEKLY AMOUNTS.

    (a) Subject to subsections (b) and (c), the trade 
readjustment allowance payable to an adversely affected worker 
for a week of total unemployment shall be an amount equal to 
the most recent weekly benefit amount of the unemployment 
insurance payable to the worker for a week of total 
unemployment preceding the worker's first exhaustion of 
unemployment insurance (as determined for purposes of section 
231(a)(3)(B)) reduced (but not below zero) by--
          (1) any training allowance deductible under 
        subsection (c); and
          (2) income that is deductible from unemployment 
        insurance under the disqualifying income provisions of 
        the applicable State law or Federal unemployment 
        insurance law.
    (b) Any adversely affected worker who is entitled to trade 
readjustment allowances and who is undergoing training approved 
by the Secretary shall receive for each week in which he is 
undergoing any such training, a trade readjustment allowance in 
an amount (computed for such week) equal to the amount computed 
under subsection (a) or (if greater) the amount of any weekly 
allowance for such training to which he would be entitled under 
any other Federal law for the training of workers, if he 
applied for such allowance. Such trade readjustment allowance 
shall be paid in lieu of any training allowance to which the 
worker would be entitled under such other Federal law.
    (c) If a training allowance under any Federal law other 
than this Act, is paid to an adversely affected worker for any 
week of unemployment with respect to which he would be entitled 
(determined without regard to any disqualification under 
section 231(b)) to a trade readjustment allowance if he applied 
for such allowance, each such week shall be deducted from the 
total number of weeks of trade readjustment allowance otherwise 
payable to him under section 233(a) when he applies for a trade 
readjustment allowance and is determined to be entitled to such 
allowance. If such training allowance paid to such worker for 
any week of unemployment is less than the amount of the trade 
readjustment allowance to which he would be entitled if he 
applied for such allowance, he shall receive, when he applies 
for a trade readjustment allowance and is determined to be 
entitled to such allowance, a trade readjustment allowance for 
such week equal to such difference.

SEC. 233. LIMITATIONS ON TRADE READJUSTMENT ALLOWANCES.

    (a)(1) The maximum amount of trade readjustment allowances 
payable with respect to the period covered by any certification 
to an adversely affected worker shall be the amount which is 
the product of 52 multiplied by the trade readjustment 
allowance payable to the worker for a week of total 
unemployment (as determined under section 232(a)), but such 
product shall be reduced by the total sum of the unemployment 
insurance to which the worker was entitled (or would have been 
entitled if he had applied therefor) in the worker's first 
benefit period described in section 231(a)(3)(A).
    (2) A trade readjustment allowance shall not be paid for 
any week occurring after the close of the 104-week period that 
begins with the first week following the week in which the 
adversely affected worker was most recently totally separated 
from adversely affected employment--
          (A) within the period which is described in section 
        231(a)(1), and
          (B) with respect to which the worker meets the 
        requirements of section 231(a)(2).
    (3) Notwithstanding paragraph (1), in order to assist the 
adversely affected worker to complete training approved for him 
under section 236, and in accordance with regulations 
prescribed by the Secretary, payments may be made as trade 
readjustment allowances for up to 26 additional weeks in the 
26-week period that--
          (A) follows the last week of entitlement to trade 
        readjustment allowances otherwise payable under this 
        chapter; or
          (B) begins with the first week of such training, if 
        such training begins after the last week described in 
        subparagraph (A).
Payments for such additional weeks may be made only for weeks 
in such 26-week period during which the individual is 
participating in such training.
    (b) A trade readjustment allowance may not be paid for an 
additional week specified in subsection (a)(3) if the adversely 
affected worker who would receive such allowance did not make a 
bona fide application to a training program approved by the 
Secretary under section 236 within 210 days after the date of 
the worker's first certification of eligibility to apply for 
adjustment assistance issued by the Secretary, or, if later, 
within 210 days after the date of the worker's total or partial 
separation referred to in section 231(a)(1).
    (c) Amounts payable to an adversely affected worker under 
this part shall be subject to such adjustment on a week-to-week 
basis as may be required by section 232(b).
    (d) Notwithstanding any other provision of this Act or 
other Federal law, if the benefit year of a worker ends within 
an extended benefit period, the number of weeks of extended 
benefits that such worker would, but for this subsection, be 
entitled to in that extended benefit period shall be reduced 
(but not below zero) by the number of weeks for which the 
worker was entitled, during such benefit year, to trade 
readjustment allowances under this part. For purposes of this 
paragraph, the terms ``benefit year'' and ``extended benefit 
period'' shall have the same respective meanings given to them 
in the Federal-State Extended Unemployment Compensation Act of 
1970.
    (e) No trade readjustment allowance shall be paid to a 
worker under this part for any week during which the worker is 
receiving on-the-job training.
    (f) For purposes of this chapter, a worker shall be treated 
as participating in training during any week which is part of a 
break in training that does not exceed 14 days if--
          (1) the worker was participating in a training 
        program approved under section 236(a) before the 
        beginning of such break in training, and
          (2) the break is provided under such training 
        program.

SEC. 234. APPLICATION OF STATE LAWS.

    Except where inconsistent with the provisions of this 
chapter and subject to such regulations as the Secretary may 
prescribe, the availability and disqualification provisions of 
the State law--
          (1) under which an adversely affected worker is 
        entitled to unemployment insurance (whether or not he 
        has filed a claim for such insurance), or
          (2) if he is not so entitled to unemployment 
        insurance, of the State in which he was totally or 
        partially separated,
shall apply to any such worker who files a claim for trade 
readjustment allowances. The State law so determined with 
respect to a separation of a worker shall remain applicable, 
for purposes of the preceding sentence, with respect to such 
separation until such worker becomes entitled to unemployment 
insurance under another State law (whether or not he has filed 
a claim for such insurance).

      Part II--Training, Other Employment Services, and Allowances


SEC. 235. EMPLOYMENT SERVICES.

    The Secretary shall make every reasonable effort to secure 
for adversely affected workers covered by a certification under 
subchapter A of this chapter counseling, testing, and placement 
services, and supportive and other services, provided for under 
any other Federal law. The Secretary shall, whenever 
appropriate, procure such services through agreements with the 
States.

SEC. 236. TRAINING.

    (a)(1) If the Secretary determines that--
          (A) there is no suitable employment (which may 
        include technical and professional employment) 
        available for an adversely affected worker,
          (B) the worker would benefit from appropriate 
        training,
          (C) there is a reasonable expectation of employment 
        following completion of such training,
          (D) training approved by the Secretary is reasonably 
        available to the worker from either governmental 
        agencies or private sources (which may include area 
        vocational education schools, as defined in section 
        195(2) of the Vocational Education Act of 1963, and 
        employers),
          (E) the worker is qualified to undertake and complete 
        such training, and
          (F) such training is suitable for the worker and 
        available at a reasonable cost,
the Secretary shall approve such training for the worker. Upon 
such approval, the worker shall be entitled to have payment of 
the costs of such training (subject to the limitations imposed 
by this section) paid on his behalf by the Secretary directly 
or through a voucher system. Insofar as possible, the Secretary 
shall provide or assure the provision of such training on the 
job, which shall include related education necessary for the 
acquisition of skills needed for a position within a particular 
occupation.
    (2)(A) The total amount of payments that may be made under 
paragraph (1) for any fiscal year shall not exceed $80,000,000, 
except that for fiscal year 1997, the total amount of payments 
made under paragraph (1) shall not exceed $70,000,000.
    (B) If, during any fiscal year, the Secretary estimates 
that the amount of funds necessary to pay the costs of training 
approved under this section will exceed the amount of the 
limitation proposed under subparagraph (A), the Secretary shall 
decide how the portion of such limitation that has not been 
expended at the time of such estimate is to be apportioned 
among the States for the remainder of such fiscal year.
    (3) For purposes of applying paragraph (1)(C), a reasonable 
expectation of employment does not require that employment 
opportunities for a worker be available, or offered, 
immediately upon the completion of training approved under this 
paragraph (1).
    (4)(A) If the costs of training an adversely affected 
worker are paid by the Secretary under paragraph (1), no other 
payment for such costs may be made under any other provision of 
Federal law.
    (B) No payment may be made under paragraph (1) of the costs 
of training an adversely affected worker if such costs--
          (i) have already been paid under any other provision 
        of Federal law, or
          (ii) are reimbursable under any other provision of 
        Federal law and a portion of such costs have already 
        been paid under such other provision of Federal law.
    (C) The provisions of this paragraph shall not apply to, or 
take into account, any funds provided under any other provision 
of Federal law which are used for any purpose other than the 
direct payment of the costs incurred in training a particular 
adversely affected worker, even if such use has the effect of 
indirectly paying or reducing any portion of the costs involved 
in training the adversely affected worker.
    (5) The training programs that may be approved under 
paragraph (1) include, but are not limited to--
          (A) on-the-job training,
          (B) any training program provided by a State pursuant 
        to title I of the Workforce Investment Act of 1998,
          (C) any training program approved by a private 
        industry council established under section 102 of such 
        Act,
          (D) any program of remedial education,
          (E) any training program (other than a training 
        program described in paragraph (7)) for which all, or 
        any portion, of the costs of training the worker are 
        paid--
                  (i) under any Federal or State program other 
                than this chapter, or
                  (ii) from any source other than this section, 
                and
          (F) any other training program approved by the 
        Secretary.
    (6)(A) The Secretary is not required under paragraph (1) to 
pay the costs of any training approved under paragraph (1) to 
the extent that such costs are paid--
          (i) under any Federal or State program other than 
        this chapter, or
          (ii) from any source other than this section.
    (B) Before approving any training to which subparagraph (A) 
may apply, the Secretary may require that the adversely 
affected worker enter into an agreement with the Secretary 
under which the Secretary will not be required to pay under 
this section the portion of the costs of such training that the 
worker has reason to believe will be paid under the program, or 
by the source, described in clause (i) or (ii) of subparagraph 
(A).
    (7) The Secretary shall not approve a training program if--
          (A) all or a portion of the costs of such training 
        program are paid under any nongovernmental plan or 
        program,
          (B) the adversely affected worker has a right to 
        obtain training or funds for training under such plan 
        or program, and
          (C) such plan or program requires the worker to 
        reimburse the plan or program from funds provided under 
        this chapter, or from wages paid under such training 
        program, for any portion of the costs of such training 
        program paid under the plan or program.
    (8) The Secretary may approve training for any adversely 
affected worker who is a member of a group certified under 
subchapter A at any time after the date on which the group is 
certified under subchapter A, without regard to whether such 
worker has exhausted all rights to any unemployment insurance 
to which the worker is entitled.
    (9) The Secretary shall prescribe regulations which set 
forth the criteria under each of the subparagraphs of paragraph 
(1) that will be used as the basis for making determinations 
under paragraph (1).
    (b) The Secretary may, where appropriate, authorize 
supplemental assistance necessary to defray reasonable 
transportation and subsistence expenses for separate 
maintenance when training is provided in facilities which are 
not within commuting distance of a worker's regular place of 
residence. The Secretary may not authorize--
          (1) payments for subsistence that exceed whichever is 
        the lesser of (A) the actual per diem expenses for 
        subsistence, or (B) payments at 50 percent of the 
        prevailing per diem allowance rate authorized under the 
        Federal travel regulations, or
          (2) payments for travel expenses exceeding the 
        prevailing mileage rate authorized under the Federal 
        travel regulations, and
    (c) The Secretary shall pay the costs of any on-the-job 
training of an adversely affected worker that is approved under 
subsection (a)(1) in equal monthly installments, but the 
Secretary may pay such costs, notwithstanding any other 
provision of this section, only if--
          (1) no currently employed worker is displaced by such 
        adversely affected worker (including partial 
        displacement such as a reduction in the hours of 
        nonovertime work, wages, or employment benefits),
          (2) such training does not impair existing contracts 
        for services or collective bargaining agreements,
          (3) in the case of training which would be 
        inconsistent with the terms of a collective bargaining 
        agreement, the written concurrence of the labor 
        organization concerned has been obtained,
          (4) no other individual is on layoff from the same, 
        or any substantially equivalent, job for which such 
        adversely affected worker is being trained,
          (5) the employer has not terminated the employment of 
        any regular employee or otherwise reduced the work 
        force of the employer with the intention of filling the 
        vacancy so created by hiring such adversely affected 
        worker,
          (6) the job for which such adversely affected worker 
        is being trained is not being created in a promotional 
        line that will infringe in any way upon the promotional 
        opportunities of currently employed individuals,
          (7) such training is not for the same occupation from 
        which the worker was separated and with respect to 
        which such worker's group was certified pursuant to 
        section 222,
          (8) the employer certifies to the Secretary that the 
        employer will continue to employ such worker for at 
        least 26 weeks after completion of such training if the 
        worker desires to continue such employment and the 
        employer does not have due cause to terminate such 
        employment,
          (9) the employer has not received payment under 
        subsection (a)(1) with respect to any other on-the-job 
        training provided by such employer which failed to meet 
        the requirements of paragraphs (1), (2), (3), (4), (5), 
        and (6), and
          (10) the employer has not taken, at any time, any 
        action which violated the terms of any certification 
        described in paragraph (8) made by such employer with 
        respect to any other on-the-job training provided by 
        such employer for which the Secretary has made a 
        payment under subsection (a)(1).
    (d) A worker may not be determined to be ineligible or 
disqualified for unemployment insurance or program benefits 
under this subchapter because the individual is in training 
approved under subsection (a), because of leaving work which is 
not suitable employment to enter such training, or because of 
the application to any such week in training of provisions of 
State law or Federal unemployment insurance law relating to 
availability for work, active search for work, or refusal to 
accept work. The Secretary shall submit to the Congress a 
quarterly report regarding the amount of funds expended during 
the quarter concerned to provide training under paragraph (1) 
and the anticipated demand for such funds for any remaining 
quarters in the fiscal year concerned.
    (e) For purposes of this section the term ``suitable 
employment'' means, with respect to a worker, work of a 
substantially equal or higher skill level than the worker's 
past adversely affected employment, and wages for such work at 
not less than 80 percent of the worker's average weekly wage.

SEC. 237. JOB SEARCH ALLOWANCES.

    (a) Any adversely affected worker covered by a 
certification under subchapter A of this chapter may file an 
application with the Secretary for a job search allowance. Such 
allowance, if granted, shall provide reimbursement to the 
worker of 90 percent of the cost of necessary job search 
expenses as prescribed by regulations of the Secretary; except 
that--
          (1) such reimbursement may not exceed $800 for any 
        worker, and
          (2) reimbursement may not be made for subsistence and 
        transportation expenses at levels exceeding those 
        allowable under section 236(b) (1) and (2).
    (b) A job search allowance may be granted only--
          (1) to assist an adversely affected worker who has 
        been totally separated in securing a job within the 
        United States;
          (2) where the Secretary determines that such worker 
        cannot reasonably be expected to secure suitable 
        employment in the commuting area in which he resides; 
        and
          (3) where the worker has filed an application for 
        such allowance with the Secretary before--
                  (A) the later of--
                          (i) the 365th day after the date of 
                        the certification under which the 
                        worker is eligible, or
                          (ii) the 365th day after the date of 
                        the worker's last total separation; or
                  (B) the 182d day after the concluding date of 
                any training received by the worker, if the 
                worker was referred to such training by the 
                Secretary.
    (c) The Secretary shall reimburse any adversely affected 
worker for necessary expenses incurred by such worker in 
participating in a job search program approved by the 
Secretary.

SEC. 238. RELOCATION ALLOWANCES.

    (a) Any adversely affected worker covered by a 
certification under subchapter A of this chapter may file an 
application with the Secretary for a relocation allowance, 
subject to the terms and conditions of this section, if such 
worker files such application before--
          (1) the later of--
                  (A) the 425th day after the date of the 
                certification, or
                  (B) the 425th day after the date of the 
                worker's last total separation; or
          (2) the 182d day after the concluding date of any 
        training received by such worker, if the worker was 
        referred to such training by the Secretary.
    (b) A relocation allowance may be granted only to assist an 
adversely affected worker in relocating within the United 
States and only if the Secretary determines that such worker 
cannot reasonably be expected to secure suitable employment in 
the commuting area in which he resides and that such worker--
          (1) has obtained suitable employment affording a 
        reasonable expectation of long-term duration in the 
        area in which he wishes to relocate, or
          (2) has obtained a bona fide offer of such 
        employment, and
          (3) is totally separated from employment at the time 
        relocation commences.
    (c) A relocation allowance shall not be granted to such 
worker unless his relocation occurs within 182 days after the 
filing of the application therefor or (in the case of a worker 
who has been referred to training by the Secretary) within 182 
days after the conclusion of such training.
    (d) For the purposes of this section, the term ``relocation 
allowance'' means--
          (1) 90 percent of the reasonable and necessary 
        expenses (including, but not limited to, subsistence 
        and transportation expenses at levels not exceeding 
        those allowable under section 236(b) (1) and (2)) 
        specified in regulations prescribed by the Secretary, 
        incurred in transporting a worker and his family if 
        any, and household effects, and
          (2) a lump sum equivalent to three times the worker's 
        average weekly wage, up to a maximum payment of $800.

                    Subchapter C--General Provisions


SEC. 239. AGREEMENTS WITH STATES.

    (a) The Secretary is authorized on behalf of the United 
States to enter into an agreement with any State, or with any 
State agency (referred to in this subchapter as ``cooperating 
States'' and ``cooperating States agencies'' respectively). 
Under such an agreement, the cooperating State agency (1) as 
agent of the United States, will receive applications for, and 
will provide, payments on the basis provided in this chapter, 
(2) where appropriate, but in accordance with subsection (f), 
will afford adversely affected workers testing, counseling, 
referral to training and job search programs, and placement 
services, (3) will make any certifications required under 
section 231(c)(2), and (4) will otherwise cooperate with the 
Secretary and with other State and Federal agencies in 
providing payments and services under this chapter.
    (b) Each agreement under this subchapter shall provide the 
terms and conditions upon which the agreement may be amended, 
suspended, or terminated.
    (c) Each agreement under this subchapter shall provide that 
unemployment insurance otherwise payable to any adversely 
affected worker will not be denied or reduced for any week by 
reason of any right to payments under this chapter.
    (d) A determination by a cooperating State agency with 
respect to entitlement to program benefits under an agreement 
is subject to review in the same manner and to the same extent 
as determinations under the applicable State law and only in 
that manner and to that extent.
    (e) Any agreement entered into under this section shall 
provide for the coordination of the administration of the 
provisions for employment services, training, and supplemental 
assistance under sections 235 and 236 of this Act and under 
title I of the Workforce Investment Act of 1998 upon such terms 
and conditions as are established by the Secretary in 
consultation with the States and set forth in such agreement. 
Any agency of the State jointly administering such provisions 
under such agreement shall be considered to be a cooperating 
State agency for purposes of this chapter.
    (f) Each cooperating State agency shall, in carrying out 
subsection (a)(2)--
          (1) advise each worker who applies for unemployment 
        insurance of the benefits under this chapter and the 
        procedures and deadlines for applying for such 
        benefits,
          (2) facilitate the early filing of petitions under 
        section 221 for any workers that the agency considers 
        are likely to be eligible for benefits under this 
        chapter,
          (3) advise each adversely affected worker to apply 
        for training under section 236(a) before, or at the 
        same time, the worker applies for trade readjustment 
        allowances under part I of subchapter B, and
          (4) as soon as practicable, interview the adversely 
        affected worker regarding suitable training 
        opportunities available to the worker under section 236 
        and review such opportunities with the worker.
      (g) In order to promote the coordination of workforce 
investment activities in each State with activities carried out 
under this chapter, any agreement entered into under this 
section shall provide that the State shall submit to the 
Secretary, in such form as the Secretary may require, the 
description and information described in paragraphs (8) and 
(14) of section 112(b) of the Workforce Investment Act of 1998.
    [Section 3302(c)(3) of the Internal Revenue Code of 1986 
(relating to credits against Federal unemployment tax) was 
originally enacted as part of section 239 of the Trade Act of 
1974:
          [``(3) If the Secretary of Labor determines that a 
        State, or State agency, has not--
                  [``(A) entered into the agreement described 
                in section 239 of the Trade Act of 1974, with 
                the Secretary of Labor before July 15, 1975, or
                  [``(B) fulfilled its commitments under an 
                agreement with the Secretary of Labor as 
                described in section 239 of the Trade Act of 
                1974,
        then, in the case of a taxpayer subject to the 
        unemployment compensation law of such State, the total 
        credits (after applying subsections (a) and (b) and 
        paragraphs (1) and (2) of this section) otherwise 
        allowable under this section for a year during which 
        such State or agency does not enter into or fulfill 
        such an agreement shall be reduced by 7\1/2\ percent of 
        the tax imposed with respect to wages paid by such 
        taxpayer during such year which are attributable to 
        such State.''.]

SEC. 240. ADMINISTRATION ABSENT STATE AGREEMENT.

    (a) In any State where there is no agreement in force 
between a State or its agency under section 239, the Secretary 
shall arrange under regulations prescribed by him for 
performance of all necessary functions under subchapter B of 
this chapter, including provision for a fair hearing for any 
worker whose application for payments is denied.
    (b) A final determination under subsection (a) with respect 
to entitlement to program benefits under subchapter B of this 
chapter is subject to review by the courts in the same manner 
and to the same extent as is provided by section 205(g) of the 
Social Security Act (42 U.S.C. 405(g)).

SEC. 241. PAYMENTS TO STATES.

    (a) The Secretary shall from time to time certify to the 
Secretary of the Treasury for payment to each cooperating State 
the sums necessary to enable such State as agent of the United 
States to make payments provided for by this chapter.
    (b) All money paid a State under this section shall be used 
solely for the purposes for which it is paid; and money so paid 
which is not used for such purposes shall be returned, at the 
time specified in the agreement under this subchapter, to the 
Secretary of the Treasury.
    (c) Any agreement under this subchapter may require any 
officer or employee of the State certifying payments or 
disbursing funds under the agreement or otherwise participating 
in the performance of the agreement, to give a surety bond to 
the United States in such amount as the Secretary may deem 
necessary, and may provide for the payment of the cost of such 
bond from funds for carrying out the purposes of this chapter.

SEC. 242. LIABILITIES OF CERTIFYING AND DISBURSING OFFICERS.

    (a) No person designated by the Secretary, or designated 
pursuant to an agreement under this subchapter, as a certifying 
officer, shall, in the absence of gross negligence or intent to 
defraud the United States, be liable with respect to any 
payment certified by him under this chapter.
    (b) No disbursing officer shall, in the absence of gross 
negligence or intent to defraud the United States, be liable 
with respect to any payment by him under this chapter if it was 
based upon a voucher signed by a certifying officer designated 
as provided in subsection (a).

SEC. 243. FRAUD AND RECOVERY OF OVERPAYMENTS.

    (a)(1) If a cooperating State agency, the Secretary, or a 
court of competent jurisdiction determines that any person has 
received any payment under this chapter to which the person was 
not entitled, including a payment referred to in subsection 
(b), such person shall be liable to repay such amount to the 
State agency or the Secretary, as the case may be, except that 
the State agency or the Secretary may waive such repayment if 
such agency or the Secretary determines, in accordance with 
guidelines prescribed by the Secretary, that--
          (A) the payment was made without fault on the part of 
        such individual, and
          (B) requiring such repayment would be contrary to 
        equity and good conscience.
    (2) Unless an overpayment is otherwise recovered, or waived 
under paragraph (1), the State agency or the Secretary shall 
recover the overpayment by deductions from any sums payable to 
such person under this chapter, under any Federal unemployment 
compensation law administered by the State agency or the 
Secretary, or under any other Federal law administered by the 
State agency or the Secretary which provides for the payment of 
assistance or an allowance with respect to unemployment, and, 
notwithstanding any other provision of State law or Federal law 
to the contrary, the Secretary may require the State agency to 
recover any overpayment under this chapter by deduction from 
any unemployment insurance payable to such person under the 
State law, except that no single deduction under this paragraph 
shall exceed 50 percent of the amount otherwise payable.
    (b) If a cooperating State agency, the Secretary, or a 
court of competent jurisdiction determines that an individual--
          (1) knowingly has made, or caused another to make, a 
        false statement or representation of a material fact, 
        or
          (2) knowingly has failed, or caused another to fail, 
        to disclose a material fact,
and as a result of such false statement or representation, or 
of such nondisclosure, such individual has received any payment 
under this chapter to which the individual was not entitled, 
such individual shall, in addition to any other penalty 
provided by law, be ineligible for any further payments under 
this chapter.
    (c) Except for overpayments determined by a court of 
competent jurisdiction, no repayment may be required, and no 
deduction may be made, under this section until a determination 
under subsection (a)(1) by the State agency or the Secretary, 
as the case may be, has been made, notice of the determination 
and an opportunity for a fair hearing thereon has been given to 
the individual concerned, and the determination has become 
final.
    (d) Any amount recovered under this section shall be 
returned to the Treasury of the United States.

SEC. 244. PENALTIES.

    Whoever makes a false statement of a material fact knowing 
it to be false, or knowingly fails to disclose a material fact, 
for the purpose of obtaining or increasing for himself or for 
any other person any payment authorized to be furnished under 
this chapter or pursuant to an agreement under section 239 
shall be fined not more than $1,000 or imprisoned for not more 
than one year, or both.

SEC. 245. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--There are authorized to be appropriated to 
the Department of Labor, for the period beginning October 1, 
1998, and ending September 30, 2001, such sums as may be 
necessary to carry out the purposes of this chapter, other than 
subchapter D.
    (b) Subchapter D.--There are authorized to be appropriated 
to the Department of Labor, for the period beginning October 1, 
1998, and ending September 30, 2001, such sums as may be 
necessary to carry out the purposes of subchapter D of this 
chapter.

SEC. 246. SUPPLEMENTAL WAGE ALLOWANCE DEMONSTRATION PROJECTS.

    (a) The Secretary shall establish one or more demonstration 
projects during fiscal years 1989 and 1990 for the purpose of--
          (1) determining the attractiveness of a supplemental 
        wage allowance to various categories of workers 
        eligible for assistance under this chapter, based on 
        the amount and duration of the supplement;
          (2) determining the effectiveness of a supplemental 
        wage allowance as an option under this chapter in 
        facilitating the readjustment of adversely affected 
        workers; and
          (3) determining whether a supplemental wage allowance 
        should be made an option under the Trade Adjustment 
        Assistance program for all fiscal years.
    (b)(1) For purposes of this section, the term 
``supplemental wage allowance'' means a payment that is made to 
an adversely affected worker who--
          (A) accepts full-time employment at an average weekly 
        wage that is less than the average weekly wage of the 
        worker in the adversely affected employment,
          (B) prior to such acceptance, is eligible for trade 
        readjustment allowances under part I of subchapter B, 
        and
          (C) voluntarily elects to receive such payment in 
        lieu of any trade readjustment allowances that the 
        worker would otherwise be eligible to receive with 
        respect to the period covered by the certification made 
        under subchapter A that applies to such worker.
    (2) A supplemental wage allowance shall be provided under 
any demonstration project established under subsection (a) to a 
worker described in paragraph (1) for each week during which 
the worker performs services in the full-time employment 
referred to in paragraph (1)(A) in an amount that does not 
exceed the lesser of--
          (A) the amount of the trade readjustment allowance 
        that the worker would have been eligible to receive for 
        any week under part 1 of subchapter B if the worker had 
        not accepted the full-time employment and had not made 
        the election described in paragraph (1)(C), or
          (B) the excess of--
                  (i) an amount equal to 80 percent of the 
                average weekly wage of the worker in the 
                adversely affected employment, over
                  (ii) the average weekly wage in the full-time 
                employment.
    (3)(A) Supplemental wage allowances shall not be provided 
under any demonstration project established under subsection 
(a) for more than 52 weeks.
    (B) The total amount of supplemental wage allowances that 
may be paid to any worker under any demonstration project 
established under subsection (a) with respect to the period 
covered by the certification applicable to such worker shall 
not exceed an amount that is equal to the excess of--
          (i) the amount of the limitation imposed under 
        section 233(a)(1) with respect to such worker for such 
        period, over
          (ii) the amount of the trade readjustment allowances 
        paid under part I of subchapter B to such worker for 
        such period.
    (c) The Secretary shall provide for an evaluation of 
demonstration projects conducted under this section to 
determine at least the following:
          (1) the extent to which different age groups of 
        eligible recipients utilize the supplemental wage 
        allowance;
          (2) the effect of the amount and duration of the 
        supplemental wage allowance on the utilization of the 
        allowance;
          (3) the extent to which the supplemental wage 
        allowance affects the demand for training and the 
        appropriateness thereof;
          (4) the extent to which the supplemental wage 
        allowance facilitates the readjustment of workers who 
        would not otherwise utilize benefits provided under 
        this chapter;
          (5) the extent to which the allowance affects the 
        cost of carrying out the provisions of this chapter; 
        and
          (6) the effectiveness of the supplemental wage 
        allowance as an option under this chapter in 
        facilitating the readjustment of adversely affected 
        workers.
    (d) By no later than the date that is 6 years after the 
date of enactment of the Omnibus Trade and Competitiveness Act 
of 1988, the Secretary shall transmit to the Congress a report 
that includes--
          (1) an evaluation of the projects authorized under 
        this section that is conducted in accordance with 
        subsection (c), and
          (2) a recommendation as to whether the supplemental 
        wage allowance should be available on a permanent basis 
        as an option for some or all workers eligible for 
        assistance under this chapter.
    [Paragraph 2 of section 1423(d) of the Omnibus Trade and 
Competitiveness Act of 1988 provides:
          [``For purposes of funding the demonstration projects 
        established under section 246(a) of the Trade Act of 
        1974, as added by paragraph (1) of this subsection--
                  [``(A) the supplemental wage allowances 
                payable under such projects shall be considered 
                to be trade readjustment allowances payable 
                under part I of subchapter B of chapter 2 of 
                title II of the Trade Act of 1974, and
                  [``(B) the costs of administering such 
                projects by the States shall be considered to 
                be costs of administering such part I.''.]

SEC. 247. DEFINITIONS.

    For purposes of this chapter--
          (1) The term ``adversely affected employment'' means 
        employment in a firm or appropriate subdivision of a 
        firm, if workers of such firm or subdivision are 
        eligible to apply for adjustment assistance under this 
        chapter.
          (2) The term ``adversely affected worker'' means an 
        individual who, because of lack of work in adversely 
        affected employment--
                  (A) has been totally or partially separated 
                from such employment, or
                  (B) has been totally separated from 
                employment with the firm in a subdivision of 
                which such adversely affected employment 
                exists.
          [(3) Repealed.]
          (4) The term ``average weekly wage'' means one-
        thirteenth of the total wages paid to an individual in 
        the high quarter. For purposes of this computation, the 
        high quarter shall be that quarter in which the 
        individual's total wages were highest among the first 4 
        of the last 5 completed calendar quarters immediately 
        before the quarter in which occurs the week with 
        respect to which the computation is made. Such week 
        shall be the week in which total separation occurred, 
        or, in cases where partial separation is claimed, an 
        appropriate week, as defined in regulations prescribed 
        by the Secretary.
          (5) The term ``average weekly hours'' means the 
        average hours worked by the individual (excluding 
        overtime) in the employment from which he has been or 
        claims to have been separated in the 52 weeks 
        (excluding weeks during which the individual was sick 
        or on vacation) preceding the week specified in the 
        last sentence of paragraph (4).
          (6) The term ``partial separation'' means, with 
        respect to an individual who has not been totally 
        separated, that he has had--
                  (A) his hours of work reduced to 80 percent 
                or less of his average weekly hours in 
                adversely affected employment, and
                  (B) his wages reduced to 80 percent or less 
                of his average weekly wage in such adversely 
                affected employment.
          [(7) Repealed.]
          (8) The term ``State'' includes the District of 
        Columbia and the Commonwealth of Puerto Rico; and the 
        term ``United States'' when used in the geographical 
        sense includes such Commonwealth.
          (9) The term ``State agency'' means the agency of the 
        State which administers the State law.
          (10) The term ``State law'' means the unemployment 
        insurance law of the State approved by the Secretary of 
        Labor under section 3304 of the Internal Revenue Code 
        of 1954.
          (11) The term ``total separation'' means the layoff 
        or severance of an individual from employment with a 
        firm in which, or in a subdivision of which, adversely 
        affected employment exists.
          (12) The term ``unemployment insurance'' means the 
        unemployment compensation payable to an individual 
        under any State law or Federal unemployment 
        compensation law, including chapter 85 of title 5, 
        United States Code, and the Railroad Unemployment 
        Insurance Act. The terms ``regular compensation'', 
        ``additional compensation'', and ``extended 
        compensation'' have the same respective meanings that 
        are given them in section 205(2), (3), and (4) of the 
        Federal-State Extended Unemployment Compensation Act of 
        1970 (26 U.S.C. 3304 note.)
          (13) The term ``week'' means a week as defined in the 
        applicable State law.
          (14) The term ``week of unemployment'' means a week 
        of total, part-total, or partial unemployment as 
        determined under the applicable State law or Federal 
        unemployment insurance law.
          (15) The term ``benefit period'' means, with respect 
        to an individual--
                  (A) the benefit year and any ensuing period, 
                as determined under applicable State law, 
                during which the individual is eligible for 
                regular compensation, additional compensation, 
                or extended compensation, or
                  (B) the equivalent to such a benefit year or 
                ensuing period provided for under the 
                applicable Federal unemployment insurance law.
          (16) The term ``on-the-job training'' means training 
        provided by an employer to an individual who is 
        employed by the employer.
          (17)(A) The term ``job search program'' means a job 
        search workshop or job finding club.
          (B) The term ``job search workshop'' means a short (1 
        to 3 days) seminar designed to provide participants 
        with knowledge that will enable the participants to 
        find jobs. Subjects are not limited to, but should 
        include, labor market information, resume writing, 
        interviewing techniques, and techniques for finding job 
        openings.
          (C) The term ``job finding club'' means a job search 
        workshop which includes a period (1 and 2 weeks) of 
        structured, supervised activity in which participants 
        attempt to obtain jobs.

SEC. 248. REGULATIONS.

    The Secretary shall prescribe such regulations as may be 
necessary to carry out the provisions of this chapter.

SEC. 249. SUBPENA POWER.

    (a) The Secretary may require by subpena the attendance of 
witnesses and the production of evidence necessary for him to 
make a determination under the provisions of this chapter.
    (b) If a person refuses to obey a subpena issued under 
subsection (a), a United States district court within the 
jurisdiction of which the relevant proceeding under this 
chapter is conducted may, upon petition by the Secretary, issue 
an order requiring compliance with such subpena.

SEC. 249A. NONDUPLICATION OF ASSISTANCE.

    No worker may receive assistance relating to a separation 
pursuant to certifications under both subchapters A and D of 
this chapter.

     Subchapter D--NAFTA Transitional Adjustment Assistance Program


SEC. 250. ESTABLISHMENT OF TRANSITIONAL PROGRAM.

    (a) Group Eligibility Requirements.--
          (1) Criteria.--A group of workers (including workers 
        in any agricultural firm or subdivision of an 
        agricultural firm) shall be certified as eligible to 
        apply for adjustment assistance under this subchapter 
        pursuant to a petition filed under subsection (b) if 
        the Secretary determines that a significant number or 
        proportion of the workers in such worker's firm or an 
        appropriate subdivision of the firm have become totally 
        or partially separated, or are threatened to become 
        totally or partially separated, and either--
                  (A) that--
                          (i) the sales or production, or both, 
                        of such firm or subdivision have 
                        decreased absolutely,
                          (ii) imports from Mexico or Canada of 
                        articles like or directly competitive 
                        with articles produced by such firm or 
                        subdivision have increased, and
                          (iii) the increase in imports under 
                        clause (ii) contributed importantly to 
                        such workers' separation or threat of 
                        separation and to the decline in the 
                        sales or production of such firm or 
                        subdivision; or
                  (B) that there has been a shift in production 
                by such workers' firm or subdivision to Mexico 
                or Canada of articles like or directly 
                competitive with articles which are produced by 
                the firm or subdivision.
          (2) Definition of contributed importantly.--The term 
        ``contributed importantly'', as used in paragraph 
        (1)(A)(iii), means a cause which is important but not 
        necessarily more important than any other cause.
          (3) Regulations.--The Secretary shall issue 
        regulations relating to the application of the criteria 
        described in paragraph (1) in making preliminary 
        findings under subsection (b) and determinations under 
        subsection (c).
    (b) Preliminary Findings and Basic Assistance.--
          (1) Filing of petitions.--A petition for 
        certification of eligibility to apply for adjustment 
        assistance under this subchapter may be filed by a 
        group of workers (including workers in any agricultural 
        firm or subdivision of an agricultural firm) or by 
        their certified or recognized union or other duly 
        authorized representative with the Governor of the 
        State in which such workers' firm or subdivision 
        thereof is located.
          (2) Findings and assistance.--Upon receipt of a 
        petition under paragraph (1), the Governor shall--
                  (A) notify the Secretary that the Governor 
                has received the petition;
                  (B) within 10 days after receiving the 
                petition--
                          (i) make a preliminary finding as to 
                        whether the petition meets the criteria 
                        described in subsection (a)(1) (and for 
                        purposes of this clause the criteria 
                        described under subparagraph (A)(iii) 
                        of such subsection shall be 
                        disregarded), and
                          (ii) transmit the petition, together 
                        with a statement of the finding under 
                        clause (i) and reasons therefor, to the 
                        Secretary for action under subsection 
                        (c); and
                  (C) if the preliminary finding under 
                subparagraph (B)(i) is affirmative, ensure that 
                rapid response and basic readjustment services 
                authorized under other Federal law are made 
                available to the workers.
    (c) Review of Petitions by Secretary; Certifications.--
          (1) In general.--The Secretary, within 30 days after 
        receiving a petition under subsection (b), shall 
        determine whether the petition meets the criteria 
        described in subsection (a)(1). Upon a determination 
        that the petition meets such criteria, the Secretary 
        shall issue to workers covered by the petition a 
        certification of eligibility to apply for assistance 
        described in subsection (d).
          (2) Denial of certification.--Upon denial of 
        certification with respect to a petition under 
        paragraph (1), the Secretary shall review the petition 
        in accordance with the requirements of subchapter A to 
        determine if the workers may be certified under such 
        subchapter.
    (d) Comprehensive Assistance.--Workers covered by 
certification issued by the Secretary under subsection (c) 
shall be provided, in the same manner and to the same extent as 
workers covered under a certification under subchapter A, the 
following:
          (1) Employment services described in section 235.
          (2) Training described in section 236, except that 
        notwithstanding the provisions of section 236(a)(2)(A), 
        the total amount of payments for training under this 
        subchapter for the period beginning October 1, 1998, 
        and ending september 30, 2001, shall not exceed 
        $30,000,000 for any fiscal year.
          (3) Trade readjustment allowances described in 
        sections 231 through 234, except that--
                  (A) the provisions of sections 231(a)(5)(c) 
                and 231(c), authorizing the payment of trade 
                readjustment allowances upon a finding that it 
                is not feasible or appropriate to approve a 
                training program for a worker, shall not be 
                applicable to payment of such allowances under 
                this subchapter; and
                  (B) notwithstanding the provisions of section 
                233(b), in order for a worker to qualify for 
                trade readjustment allowances under this 
                subchapter, the worker shall be enrolled in a 
                training program approved by the Secretary 
                under section 236(a) by the later of--
                          (i) the last day of the 16th week of 
                        such worker's initial unemployment 
                        compensation benefit period, or
                          (ii) the last day of the 6th week 
                        after the week in which the Secretary 
                        issues a certification covering such 
                        worker.
        In cases of extenuating circumstances relating to 
        enrollment in a training program, the Secretary may 
        extend the time for enrollment for a period not to 
        exceed 30 days.
          (4) Job search allowances described in section 237.
          (5) Relocation allowances described in section 238.
    (e) Administration.--The provisions of subchapter C shall 
apply to the administration of the program under this 
subchapter in the same manner and to the same extent as such 
provisions apply to the administration of the program under 
subchapters A and B, except that the agreement between the 
Secretary and the States described in section 239 shall specify 
the procedures that will be used to carry out the certification 
process under subsection (c) and the procedures for providing 
relevant data by the Secretary to assist the States in making 
prliminary findings under subsection (b).
    [Section 506(b) of the NAFTA Implementation Act provides:
    [``(b) Covered Workers.--
          [``(1) General rule.--Except as provided in paragraph 
        (2), no worker shall be certified as eligible to 
        receive assistance under subchapter D of chapter 2 of 
        title II of the Trade Act of 1974 (as added by this 
        subtitle) whose last total or partial separation from a 
        firm (or appropriate subdivision of a firm) occurred 
        before such date of entry into force.
          [``(2) Reachback.--Notwithstanding paragraph (1), any 
        worker--
                  [``(A) whose last total or partial separation 
                from a firm (or appropriate subdivision of a 
                firm) occurs--
                          [``(i) after the date of the 
                        enactment of this Act, and
                          [``(ii) before such date of entry 
                        into force, and
                  [``(B) who would otherwise be eligible to 
                receive assistance under subchapter D of 
                chapter 2 of title II of the Trade Act of 1974,
[``shall be eligible to receive such assistance in the same 
manner as if such separation occurred on or after such date of 
entry into force.''.]

               Chapter 3--Adjustment Assistance for Firms


SEC. 251. PETITIONS AND DETERMINATIONS.

    (a) A petition for a certification of eligibility to apply 
for adjustment assistance under this chapter may be filed with 
the Secretary of Commerce (hereinafter in this chapter referred 
to as the ``Secretary'') by a firm (including any agricultural 
firm) or its representative. Upon receipt of the petition, the 
Secretary shall promptly publish notice in the Federal Register 
that he has received the petition and initiated an 
investigation.
    (b) If the petitioner, or any other person, organization, 
or group found by the Secretary to have a substantial interest 
in the proceedings, submits not later than 10 days after the 
date of the Secretary's publication under subsection (a) a 
request for a hearing, the Secretary shall provide for a public 
hearing and afford such interested persons an opportunity to be 
present, to produce evidence, and to be heard.
    (c)(1) The Secretary shall certify a firm (including any 
agricultural firm) as eligible to apply for adjustment 
assistance under this chapter if the Secretary determines--
          (A) that a significant number or proportion of the 
        workers in such firm have become totally or partially 
        separated, or are threatened to become totally or 
        partially separated,
          (B) that--
                  (i) sales or production, or both, of the firm 
                have decreased absolutely, or
                  (ii) sales or production, or both, of an 
                article that accounted for not less than 25 
                percent of the total production or sales of the 
                firm during the 12-month period preceding the 
                most recent 12-month period for which data are 
                available have decreased absolutely, and
          (C) increases of imports of articles like or directly 
        competitive with articles which are produced by such 
        firm contributed importantly to such total or partial 
        separation, or threat thereof, and to such decline in 
        sales or production.
    (2) For purposes of paragraph (1)(C)--
          (A) The term ``contributed importantly'' means a 
        cause which is important but not necessarily more 
        important than any other cause.
          (B)(i) Any firm which engages in exploration or 
        drilling for oil or natural gas shall be considered to 
        be a firm producing oil or natural gas.
          (ii) Any firm that engages in exploration or drilling 
        for oil or natural gas, or otherwise producing articles 
        directly competitive with imports of oil and with 
        imports of natural gas.
    (d) A determination shall be made by the Secretary as soon 
as possible after the date on which the petition is filed under 
this section, but in any event not later than 60 days after 
that date.

SEC. 252. APPROVAL OF ADJUSTMENT PROPOSALS.

    (a) A firm certified under section 251 as eligible to apply 
for adjustment assistance may, at any time within 2 years after 
the date of such certification, file an application with the 
Secretary for adjustment assistance under this chapter. Such 
application shall include a proposal for the economic 
adjustment of such firm.
    (b)(1) Adjustment assistance under this chapter consists of 
technical assistance. The Secretary shall approve a firm's 
application for adjustment assistance only if the Secretary 
determines that the firm's adjustment proposal--
          (A) is reasonably calculated to materially contribute 
        to the economic adjustment of the firm,
          (B) gives adequate consideration to the interests of 
        the workers of such firm, and
          (C) demonstrates that the firm will make all 
        reasonable efforts to use its own resources for 
        economic development.
    (2) The Secretary shall make a determination as soon as 
possible after the date on which an application is filed under 
this section, but in no event later than 60 days after such 
date.
    (c) Whenever the Secretary determines that any firm no 
longer requires assistance under this chapter, he shall 
terminate the certification of eligibility of such firm and 
promptly have notice of such termination published in the 
Federal Register. Such termination shall take effect on the 
termination date specified by the Secretary.

SEC. 253. TECHNICAL ASSISTANCE.

    (a) The Secretary may provide a firm, on terms and 
conditions as the Secretary determines to be appropriate, with 
such technical assistance as in his judgment will carry out the 
purposes of this chapter with respect to the firm. The 
technical assistance furnished under this chapter may consist 
of one or more of the following:
          (1) Assistance to a firm in preparing its petition 
        for certification of eligibility under section 251 of 
        this chapter.
          (2) Assistance to a certified firm in developing a 
        proposal for its economic adjustment.
          (3) Assistance of a certified firm in the 
        implementation of such a proposal.
    (b)(1) The Secretary shall furnish technical assistance 
under this chapter through existing agencies and through 
private individuals, firms, or institutions (including private 
consulting services), or by grants to intermediary 
organizations (including Trade Adjustment Assistance Centers).
    (2) In the case of assistance furnished through private 
individuals, firms, or institutions (including private 
consulting services), the Secretary may share the cost thereof 
(but not more than 75 percent of such cost for assistance 
described in paragraph (2) or (3) of subsection (a) may be 
borne by the United States).
    (3) The Secretary may make grants to intermediary 
organizations in order to defray up to 100 percent of 
administrative expenses incurred in providing such technical 
assistance to a firm.

SEC. 254. FINANCIAL ASSISTANCE.

    (a) The Secretary may provide to a firm, on such terms and 
conditions as he determines to be appropriate, such financial 
assistance in the form of direct loans or guarantees of loans 
as in his judgment will materially contribute to the economic 
adjustment of the firm. The assumption of an outstanding 
indebtedness of the firm, with or without recourse, shall be 
considered to be the making of a loan for purposes of this 
section.
    (b) Loans or guarantee of loans shall be made under this 
chapter only for the purpose of making funds available to the 
firm--
          (1) for acquisition, construction, installation, 
        modernization, development, conversion, or expansion of 
        land, plant, buildings, equipment, facilities, or 
        machinery, or
          (2) to supply such working capital as may be 
        necessary to enable the firm to implement its 
        adjustment proposal.
    (c) No direct loan may be provided to a firm under this 
chapter if the firm can obtain loan funds from private sources 
(with or without a guarantee) at a rate no higher than the 
maximum interest per annum that a participating financial 
institution may establish on guaranteed loans made pursuant to 
section 7(a) of the Small Business Act.
    (d) Notwithstanding any other provision of this chapter, no 
direct loans or guarantees of loans may be made under this 
chapter after the date of enactment of the Trade Adjustment 
Assistance Reform and Extension Act of 1986.

SEC. 255. CONDITIONS FOR FINANCIAL ASSISTANCE.

    (a) No financial assistance shall be provided under this 
chapter unless the Secretary determines--
          (1) that the funds required are not available from 
        the firm's own resources; and
          (2) that there is reasonable assurance of repayment 
        of the loan.
    (b)(1) The rate of interest on direct loans made under this 
chapter shall be--
          (A) a rate determined by the Secretary of the 
        Treasury taking into consideration the current average 
        market yield on outstanding marketable obligations of 
        the United States with remaining periods of maturity 
        that are comparable to the average maturities of such 
        loans, adjusted to the nearest one-eighth of 1 percent, 
        plus
          (B) an amount adequate in the judgment of the 
        Secretary of Commerce to cover administrative costs and 
        probable losses under the program.
    (2) The Secretary may not guarantee any loan under this 
chapter if--
          (A) the rate of interest on either the portion to be 
        guaranteed, or the portion not to be guaranteed, is 
        determined by the Secretary to be excessive when 
        compared with other loans bearing Federal guarantees 
        and subject to similar terms and conditions; and
          (B) the interest on the loan is exempt from Federal 
        income taxation under section 103 of the Internal 
        Revenue Code of 1954.
    (c) The Secretary shall make no loan or guarantee of a loan 
under section 254(b)(1) having a maturity in excess of 25 years 
or the useful life of the fixed assets (whichever period is 
shorter), including renewals and extensions; and shall make no 
loan or guarantee of a loan under section 254(b)(2) having a 
maturity in excess of 10 years, including extensions and 
renewals. Such limitations on maturities shall not, however, 
apply--
          (1) to securities or obligations received by the 
        Secretary as claimant in bankruptcy or equitable 
        reorganization, or as creditor in other proceedings 
        attendant upon insolvency of the obligor, or
          (2) to an extension or renewal for an additional 
        period not exceeding 10 years, if the Secretary 
        determines that such extension or renewal is reasonably 
        necessary for the orderly liquidation or servicing of 
        the loan.
    (d)(1) In making guarantees of loans, and in making direct 
loans, the Secretary shall give priority to firms which are 
small within the meaning of the Small Business Act (and 
regulations promulgated thereunder).
    (2) For any direct loan made, or any loan guaranteed, under 
the authority of this chapter, the Secretary may enter into 
arrangements for the servicing, including foreclosure, of such 
loans or evidences of indebtedness on terms which are 
reasonable and which protect the financial interests of the 
United States.
    (e) The following conditions apply with respect to any loan 
guaranteed under this chapter:
          (1) No guarantee may be made for an amount which 
        exceeds 90 percent of the outstanding balance of the 
        unpaid principal and interest on the loan.
          (2) The loan may be evidenced by multiple obligations 
        for the guaranteed and nonguaranteed portions of the 
        loan.
          (3) The guarantee agreement shall be conclusive 
        evidence of the eligibility of any obligation 
        guaranteed thereunder for such guarantee, and the 
        validity of any guarantee agreement shall be 
        incontestable, except for fraud or misrepresentation by 
        the holder.
    (f) The Secretary shall maintain operating reserve with 
respect to anticipated claims under guarantees made under this 
chapter. Such reserves shall be considered to constitute 
obligations for purposes of section 1311 of the Supplemental 
Appropriation Act, 1955 (31 U.S.C. 200).
    (g) The Secretary may charge a fee to a lender which makes 
a loan guaranteed under this chapter in such amount as is 
necessary to cover the cost of administration of such 
guarantee.
    (h)(1) The aggregate amount of loans made to any firm which 
are guaranteed under this chapter and which are outstanding at 
any time shall not exceed $3,000,000.
    (2) The aggregate amount of direct loans made to any firm 
under this chapter which are outstanding at any time shall not 
exceed $1,000,000.
    (i)(1) When considering whether to grant a direct loan or 
to guarantee a loan to a corporation which is otherwise 
certified under section 251, the Secretary shall give 
preference to a corporation which agrees with respect to such 
loan to fulfill the following requirements--
          (A) 25 percent of the principal amount of the loan is 
        paid by the lender to a qualified trust established 
        under an employee stock ownership plan established and 
        maintained by the recipient corporation, by a parent or 
        subsidiary of such corporation, or by several 
        corporations including the recipient corporation,
          (B) the employee stock ownership plan meets the 
        requirements of this subsection, and
          (C) the agreement among the recipient corporation, 
        the lender, and the qualified trust relating to the 
        loan meets the requirements of this section.
    (2) An employee stock ownership plan does not meet the 
requirements of this subsection unless the governing instrument 
of the plan provides that--
          (A) the amount of the loan paid under paragraph 
        (1)(A) to the qualified trust will be used to purchase 
        qualified employer securities,
          (B) the qualified trust will repay to the lender the 
        amount of such loan, together with the interest 
        thereon, out of amounts contributed to the trust by the 
        recipient corporation, and
          (C) from time to time, as the qualified trust repays 
        such amount, the trust will allocate qualified employer 
        securities among the individual accounts of 
        participants and their beneficiaries in accordance with 
        the provisions of paragraph (4).
    (3) The agreement among the recipient corporation, the 
lender, and the qualified trust does not meet the requirements 
of this subsection unless--
          (A) it is unconditionally enforceable by any party 
        against the others, jointly and severally,
          (B) it provides that the liability of the qualified 
        trust to repay loan amounts paid to the qualified trust 
        may not, at any time, exceed an amount equal to the 
        amount of contributions required under paragraph (2)(B) 
        which are actually received by such trust,
          (C) it provides that amounts received by the 
        recipient corporation from the qualified trust for 
        qualified employer securities purchased for the purpose 
        of this subsection will be used exclusively by the 
        recipient corporation for those purposes for which it 
        may use that portion of the loan paid directly to it by 
        the lender,
          (D) it provides that the recipient corporation may 
        not reduce the amount of its equity capital during the 
        one year period beginning on the date on which the 
        qualified trust purchases qualified employer securities 
        for purposes of this subsection, and
          (E) it provides that the recipient corporation will 
        make contributions to the qualified trust of not less 
        than such amounts as are necessary for such trust to 
        meet its obligations to make repayments of principal 
        and interest on the amount of the loan received by the 
        trust without regard to whether such contributions are 
        deductible by the corporation under section 404 of the 
        Internal Revenue Code of 1954 and without regard to any 
        other amounts the recipient corporation is obligated 
        under law to contribute to or under the employee stock 
        ownership plan.
    (4) At the close of each plan year, an employee stock 
ownership plan shall allocate to the accounts of participating 
employees that portion of the qualified employer securities the 
cost of which bears substantially the same ratio to the cost of 
all the qualified employer securities purchased under paragraph 
(2)(A) of this subsection as the amount of the loan principal 
and interest repaid by the qualified trust during that year 
bears to the total amount of the loan principal and interest 
payable by such trust during the term of such loan. Qualified 
employer securities allocated to the individual account of a 
participant during one plan year must bear substantially the 
same proportion to the amount of all such securities allocated 
to all participants in the plan as the amount of compensation 
paid to such participant bears to the total amount of 
compensation paid to all such participants during that year.
    (5) For purposes of this subsection, the term--
          (A) ``employee stock ownership plan'' means a plan 
        described in section 4975(e)(7) of the Internal Revenue 
        Code of 1954,
          (B) ``qualified trust'' means a trust established 
        under an employee stock ownership plan and meeting the 
        requirements of title I of the Employee Retirement 
        Income Security Act of 1974 and section 401 of the 
        Internal Revenue Code of 1954,
          (C) ``qualified employer securities'' means common 
        stock issued by the recipient corporation or by a 
        parent or subsidiary of such corporation with voting 
        power and dividend rights no less favorable than the 
        voting power and dividend rights on other common stock 
        issued by the issuing corporation and with voting power 
        being exercised by the participants in the employee 
        stock ownership plan after it is allocated to their 
        plan accounts, and
          (D) ``equity capital'' means, with respect to the 
        recipient corporation, the sum of its money and other 
        property (in an amount equal to the adusted basis of 
        such property but disregarding adjustments made on 
        account of depreciation or amortization made during the 
        period described in paragraph (3)(D)), less the amount 
        of its indebtedness.

SEC. 256. DELEGATION OF FUNCTIONS TO SMALL BUSINESS ADMINISTRATION; 
                    AUTHORIZATION OF APPROPRIATIONS.

    (a) In the case of any firm which is small (within the 
meaning of the Small Business Act and regulations promulgated 
thereunder), the Secretary may delegate all of his functions 
under this chapter (other than the functions under sections 251 
and 252(d) with respect to the certification of eligibility and 
section 264) to the Administrator of the Small Business 
Administration.
    (b) There are hereby authorized to be appropriated to the 
Secretary for the period beginning October 1, 1998, and ending 
September 30, 2001, such sums as may be necessary to carry out 
his functions under this chapter in connection with furnishing 
adjustment assistance to firms (including, but not limited to, 
the payment of principal, interest, and reasonable costs 
incident to default on loans guaranteed by the Secretary under 
the authority of this chapter), which sums are authorized to be 
appropriated to remain available until expended.
    (c) The unexpended balances of appropriations authorized by 
section 312(d) of the Trade Expansion Act of 1962 are 
transferred to the Secretary to carry out his functions under 
this chapter.

SEC. 257. ADMINISTRATION OF FINANCIAL ASSISTANCE.

    (a) In making and administering guarantees and loans under 
section 254, the Secretary may--
          (1) require security for any such guarantee or loan, 
        and enforce, waive, or subordinate such security;
          (2) assign or sell at public or private sale, or 
        otherwise dispose of, upon such terms and conditions 
        and for such consideration as he shall determine to be 
        reasonable, any evidence of debt, contract, claim, 
        personal property, or security assigned to or held by 
        him in connection with such guarantees or loans, and 
        collect, compromise, and obtain deficiency judgments 
        with respect to all obligations assigned to or held by 
        him in connection with such guarantees or loans until 
        such time as such obligations may be referred to the 
        Attorney General for suit or collection;
          (3) renovate, improve, modernize, complete, insure, 
        rent, sell, or otherwise deal with, upon such terms and 
        conditions and for such consideration as he shall 
        determine to be reasonable, any real or personal 
        property conveyed to or otherwise acquired by him in 
        connection with such guarantees or loans;
          (4) acquire, hold, transfer, release, or convey any 
        real or personal property or any interest therein 
        whenever deemed necessary or appropriate, and execute 
        all legal documents for such purposes; and
          (5) exercise all such other powers and take all such 
        other acts as may be necessary or incidental to the 
        carrying out of functions pursuant to section 254.
    (b) Any mortgage acquired as security under subsection (a) 
shall be recorded under applicable State law.
    (c) All repayments of loans, payments of interest, and 
other receipts arising out of transactions entered into by the 
Secretary pursuant to this chapter, shall be available for 
financing functions performed under this chapter, including 
administrative expenses in connection with such functions.
    (d) To the extent the Secretary deems it appropriate, and 
consistent with the provisions of section 552(b)(4) and section 
552b(c)(4) of title 5, United States Code, that portion of any 
record, material or data received by the Secretary in 
connection with any application for financial assistance under 
this chapter which contains trade secrets or commercial or 
financial information regarding the operation or competitive 
position of any business shall be deemed to be privileged or 
confidential within the meaning of those provisions.
    (e) Direct loans made, or loans guaranteed, under this 
chapter for the acquisition or development of real property or 
other capital assets shall ordinarily be secured by a first 
lien on the assets to be financed and shall be fully amortized. 
To the extent that the Secretary finds that exceptions to these 
standards are necessary to achieve the objectives of this 
chapter, he shall develop appropriate criteria for the 
protection of the interests of the United States.

SEC. 258. PROTECTIVE PROVISIONS.

    (a) Each recipient of adjustment assistance under this 
chapter shall keep records which fully disclose the amount and 
disposition by such recipient of the proceeds, if any, of such 
adjustment assistance, and which will facilitate an effective 
audit. The recipient shall also keep such other records as the 
Secretary may prescribe.
    (b) The Secretary and the Comptroller General of the United 
States shall have access for the purposes of audit and 
examination to any books, documents, papers, and records of the 
recipient petaining to adjustment assistance under this 
chapter.
    (c) No adjustment assistance under this chapter shall be 
extended to any firm unless the owners, partners, or officers 
certify to the Secretary--
          (1) the names of any attorneys, agents, and other 
        persons engaged by or on behalf of the firm for the 
        purpose of expediting applications for such adjustment 
        assistance; and
          (2) the fees paid or to be paid to any such person.
    (d) No financial assistance shall be provided to any firm 
under this chapter unless the owners, partners, or officers 
shall execute an agreement binding them and the firm for a 
period of 2 years after such financial assistance is provided, 
to refrain from employing, tendering any office or employment 
to, or retaining for professional services any person who, on 
the date such assistance or any part thereof was provided, or 
within 1 year prior thereto, shall have served as an officer, 
attorney, agent, or employee occupying a position or engaging 
in activities which the Secretary shall have determined involve 
discretion with respect to the provision of such financial 
assistance.

SEC. 259. PENALTIES.

    Whoever makes a false statement of a material fact knowing 
it to be false, or knowingly fails to disclose a material fact, 
or whoever willfully overvalues any security, for the purpose 
of influencing in any way a determination under this chapter, 
or for the purpose of obtaining money, property, or anything of 
value under this chapter, shall be fined not more than $5,000 
or imprisoned for not more than 2 years, or both.

SEC. 260. CIVIL ACTIONS.

    In providing technical and financial assistance under this 
chapter the Secretary may sue and be sued in any court of 
record of a State having general jurisidiction or in any United 
States district court, and jurisdiction is conferred upon such 
district court to determine such controversies without regard 
to the amount in controversy; but no attachment, injunction, 
garnishment, or other similar process, mesne or final, shall be 
issued against him or his property. Nothing in this section 
shall be construed to except the activities pursuant to 
sections 253 and 254 from the application of sections 516, 547, 
and 2679 of title 28 of the United States Code.

SEC. 261. DEFINITIONS.

    For purposes of this chapter, the term ``firm'' includes an 
individual proprietorship, partnership, joint venture, 
association, corporation (including a development corporation), 
business trust, cooperative, trustee in bankruptcy, and 
receiver under decree of any court. A firm, together with any 
predecessor or successor firm, or any affiliated firm 
controlled or substantially beneficially owned by substantially 
the same persons, may be considered a single firm where 
necessary to prevent unjustifiable benefits.

SEC. 262. REGULATIONS.

    The Secretary shall prescribe such regulations as may be 
necessary to carry out the provisions of this chapter.

[SEC. 263. REPEALED.]

SEC. 264. STUDY BY SECRETARY OF COMMERCE WHEN INTERNATIONAL TRADE 
                    COMMISSION BEGINS INVESTIGATION; ACTION WHERE THERE 
                    IS AFFIRMATIVE FINDING.

    (a) Whenever the Commission begins an investigation under 
section 202 with respect to an industry, the Commission shall 
immediately notify the Secretary of such investigation, and the 
Secretary shall immediately begin a study of--
          (1) the number of firms in the domestic industry 
        producing the like or directly competitive article 
        which have been or are likely to be certified as 
        eligible for adjustment assistance, and
          (2) the extent to which the orderly adjustment of 
        such firms to the import competition may be facilitated 
        through the use of existing programs.
    (b) The report of the Secretary of the study under 
subsection (a) shall be made to the President not later than 15 
days after the day on which the Commission makes its report 
under section 202(f). Upon making its report to the President, 
the Secretary shall also promptly make it public (with the 
exception of information which the Secretary determines to be 
confidential) and shall have a summary of it published in the 
Federal Register.
    (c) Whenever the Commission makes an affirmative finding 
under section 202(b) that increased imports are a substantial 
cause of serious injury or threat thereof with respect to an 
industry, the Secretary shall make available, to the extent 
feasible, full information to the firms in such industry about 
programs which may facilitate the orderly adjustment to import 
competition of such firms, and he shall provide assistance in 
the preparation and processing of petitions and applications of 
such firms for program benefits.

SEC. 265. ASSISTANCE TO INDUSTRIES.

    (a) The Secretary may provide technical assistance, on such 
terms and conditions as the Secretary deems appropriate, for 
the establishment of industrywide programs for new product 
development, new process development, export development, or 
other uses consistent with the purposes of this chapter. Such 
technical assistance may be provided through existing agencies, 
private individuals, firms, universities and institutions, and 
by grants, contracts, or cooperative agreements to 
associations, unions, or other nonprofit industry organizations 
in which a substantial number of firms or workers have been 
certified as eligible to apply for adjustment assistance under 
section 223 or 251.
    (b) Expenditures for technical assistance under this 
section may be up to $10,000,000 annually per industry and 
shall be made under such terms and conditions as the Secretary 
deems appropriate.

    [Chapter 4--Adjustment Assistance for Communities.--The program 
                   terminated on September 30, 1982.]


                  Chapter 5--Miscellaneous Provisions


SEC. 280. GENERAL ACCOUNTING OFFICE REPORT.

    (a) The Comptroller General of the United States shall 
conduct a study of the adjustment assistance programs 
established under chapters 2, 3, and 4 of this title and shall 
report the results of such study to the Congress no later than 
January 31, 1980. Such report shall include an evaluation of--
          (1) the effectiveness of such programs in aiding 
        workers, firms, and communities to adjust to changed 
        economic conditions resulting from changes in the 
        patterns of international trade; and
          (2) the coordination of the administration of such 
        programs and other Government programs which provide 
        unemployment compensation and relief to depressed 
        areas.
    (b) In carrying out his responsibilities under this 
section, the Comptroller General shall, to the extent 
practical, avail himself of the assistance of the Departments 
of Labor and Commerce. The Secretaries of Labor and Commerce 
shall make available to the Comptroller General any assistance 
necessary for an effective evaluation of the adjustment 
assistance programs established under this title.

SEC. 281. COORDINATION.

    There is established the Adjustment Assistance Coordinating 
Committee to consist of a Deputy United States Trade 
Representative as Chairman, and the officials charged with 
adjustment assistance responsibilities of the Departments of 
Labor and Commerce and the Small Business Administration. It 
shall be the function of the Committee to coordinate the 
adjustment assistance policies, studies, and programs of the 
various agencies involved and to promote the efficient and 
effective delivery of adjustment assistance benefits.

SEC. 282. TRADE MONITORING SYSTEM.

    The Secretary of Commerce and the Secretary of Labor shall 
establish and maintain a program to monitor imports of articles 
into the United States which will reflect changes in the volume 
of such imports, the relation of such imports to changes in 
domestic production, changes in employment within domestic 
industries producing articles like or directly competitive with 
such imports, and the extent to which such changes in 
production and employment are concentrated in specific 
geographic regions of the United States. A summary of the 
information gathered under this section shall be published 
regularly and provided to the Adjustment Assistance 
Coordinating Committee, the International Trade Commission, and 
to the Congress.

SEC. 283. FIRMS RELOCATING IN FOREIGN COUNTRIES.

    Before moving productive facilities from the United States 
to a foreign country, every firm should--
          (1) provide notice of the move to its employees who 
        are likely to be totally or partially separated as a 
        result of the move at least 60 days before the date of 
        such move, and
          (2) provide notice of the move to the Secretary of 
        Labor and the Secretary of Commerce on the same day it 
        notifies employees under paragraph (1).
    (b) It is the sense of the Congress that every such firm 
should--
          (1) apply for and use all adjustment assistance for 
        which it is eligible under this title,
          (2) offer employment opportunities in the United 
        States, if any exist, to its employees who are totally 
        or partially separated workers as a result of the move, 
        and
          (3) assist in relocating employees to other locations 
        in the United States where employment opportunities 
        exist.

SEC. 284. JUDICIAL REVIEW.

    (a) A worker, group of workers, certified or recognized 
union, or authorized representative of such worker or group 
aggrieved by a final determination of the Secretary of Labor 
under section 223 or section 250(c) of this title, a firm or 
its representative or any other interested domestic party 
aggrieved by a final determination of the Secretary of Commerce 
under section 251 of this title, or a community or any other 
interested domestic party aggrieved by a final determination of 
the Secretary of Commerce under section 271 of this title may, 
within sixty days after notice of such determination, commence 
a civil action in the United States Court of International 
Trade for review of such determination. The clerk of such court 
shall send a copy of the summons and the complaint in such 
action to the Secretary of Labor or the Secretary of Commerce, 
as the case may be. Upon receiving a copy of such summons and 
complaint, such Secretary shall promptly certify and file in 
such court the record on which he based such determination.
    (b) The findings of fact by the Secretary of Labor or the 
Secretary of Commerce, as the case may be, if supported by 
substantial evidence, shall be conclusive; but the court, for 
good cause shown, may remand the case to such Secretary to take 
further evidence, and such Secretary may thereupon make new or 
modified findings of fact and may modify his previous action, 
and shall certify to the court the record of the further 
proceedings. Such new or modified findings of fact shall 
likewise be conclusive if supported by substantial evidence.
    (c) The Court of International Trade shall have 
jurisdiction to affirm the action of the Secretary of Labor or 
the Secretary of Commerce, as the case may be, or to set such 
action aside, in whole or in part. The judgment of the Court of 
International Trade shall be subject to review by the United 
States Court of Appeals for the Federal Circuit as prescribed 
by the rules of such court. The judgment of the Court of 
Appeals for the Federal Circuit shall be subject to review by 
the Supreme Court of the United States upon certiorari as 
provided in section 1256 of title 28.

SEC. 285. TERMINATION.

    (a) Chapter 4 shall terminate on September 30, 1982.
    (b) No duty shall be imposed under section 287, after 
September 30, 1993.
    (c)(1) Except as provided in paragraph (2), no assistance, 
vouchers, allowances, or other payments may be provided under 
chapter 2, and no technical assistance may be provided under 
chapter 3, after September 30, 2001.
    (2)(A) Except as provided in subparagraph (B), no 
assistance, vouchers, allowances, or other payments may be 
provided under subchapter D of chapter 2 after September 30, 
2001.
    (B) Nothwithstanding subparagraph (A), if, on or before the 
day described in subparagraph (A), a worker--
          (i) is certified as eligible to apply for assistance, 
        under subchapter D of chapter 2; and
          (ii) is otherwise eligible to receive assistance in 
        accordance with section 250,
such worker shall continue to be eligible to receive such 
assistance for any week for which the worker meets the 
eligibility requirements of such section.

      Section 401 and 408 of the Trade and Development Act of 2000


                             [P.L. 106-200]

SEC. 401. REPORT ON EMPLOYMENT AND TRADE ADJUSTMENT ASSISTANCE.

    (a) In General.--Not later than 9 months after the date of 
the enactment of this section, the Comptroller General of the 
United States shall submit to Congress a report regarding the 
efficiency and effectiveness of Federal and State coordination 
of employment and retraining activities associated with the 
following programs and legislation:
          (1) Trade adjustment assistance (including NAFTA 
        trade adjustment assistance) provided for under title 
        II of the Trade Act of 1974.
          (2) The Job Training Partnership Act.
          (3) The Workforce Investment Act of 1998.
          (4) Unemployment insurance.
      (b) Period Covered.--The report shall cover the 
activities involved in the programs and legislation listed in 
subsection (a) from January 1, 1994, to December 31, 1999.
      (c) Data and Recommendations.--The report shall at a 
minimum include specific data and recommendations regarding--
          (1) the compatibility of program requirements related 
        to the employment and retraining of dislocated workers 
        in the United States, with particular emphasis on the 
        trade adjustment assistance programs provided for under 
        title II of the Trade Act of 1974;
          (2) the compatibility of application procedures 
        related to the employment and retraining of dislocated 
        workers in the United States;
          (3) the capacity of the programs in addressing 
        foreign trade and the transfer of production to other 
        countries on workers in the United States measured in 
        terms of loss of employment and wages;
          (4) the capacity of the programs in addressing 
        foreign trade and the transfer of production to other 
        countries on secondary workers in the United States 
        measured in terms of loss of employment and wages;
          (5) how the impact of foreign trade and the transfer 
        of production to other countries would have changed the 
        number of beneficiaries covered under the trade 
        adjustment assistance program if the trade adjustment 
        assistance program covered secondary workers in the 
        United States; and
          (6) the effectiveness of the programs described in 
        subsection (a) in achieving reemployment of the United 
        States workers and maintaining wage levels of United 
        States workers who have been dislocated as a result of 
        foreign trade and the transfer of production to other 
        countries.

SEC. 408. REPORT ON TRADE ADJUSTMENT ASSISTANCE FOR AGRICULTURAL 
                    COMMODITY PRODUCERS.

    (a) In General.--Not later than 4 months after the date of 
the enactment of this Act, the Secretary of Labor, in 
consultation with the Secretary of Agriculture and the 
Secretary of Commerce, shall submit to the Committee on Ways 
and Means of the House of Representatives and the Committee on 
Finance of the Senate a report that--
          (1) examines the applicability to agricultural 
        commodity producers of trade adjustment assistance 
        programs established under title II of the Trade Act of 
        1974; and
        (2) sets forth recommendations to improve the operation 
        of these programs as the programs apply to agricultural 
        commodity producers or to establish a new trade 
        adjustment assistance program for agricultural 
        commodity producers.
      (b) Contents.--In preparing the report required by 
subsection (a), the Secretary of Labor shall--
          (1) assess the degree to which the existing trade 
        adjustment assistance programs address the adverse 
        effects on agricultural commodity producers due to 
        price suppression caused by increased imports of like 
        or directly competitive agricultural commodities; and
          (2) examine the effectiveness of the program benefits 
        authorized under subchapter B of chapter 2 and chapter 
        3 of title II of the Trade Act of 1974 in remedying the 
        adverse effects, including price suppression, caused by 
        increased imports of like or directly competitive 
        agricultural commodities.
      (c) Definitions.--In this section:
          (1) Agricultural commodity.--The term ``agricultural 
        commodity'' means any agricultural commodity, including 
        livestock, fish or harvested seafood in its raw or 
        natural state.
          (2) Agricultural commodity producer.--The term 
        ``agricultural commodity producer'' means any person 
        who is engaged in the production and sale of an 
        agricultural commodity in the United States and who 
        owns or shares the ownership and risk of loss of the 
        agricultural commodity.

           *       *       *       *       *       *       *

               Chapter 10: OTHER LAWS REGULATING IMPORTS

A. AUTHORITIES TO RESTRICT IMPORTS OF AGRICULTURAL AND TEXTILE PRODUCTS

        Section 204 of the Agricultural Act of 1956, as amended

 [7 U.S.C. 1854; P.L. 84-540, as amended by P.L. 87-488, P.L. 103-465, 
                           and P.L. 104-295]

    Sec. 204. The President may, whenever he determines such 
action appropriate, negotiate with representatives of foreign 
governments in an effort to obtain agreements limiting the 
export from such countries and the importation into the United 
States of any agricultural commodity or product manufactured 
therefrom or textiles or textile products, and the President is 
authorized to issue regulations governing the entry or 
withdrawal from warehouse of any such commodity, product, 
textiles, or textile products to carry out any such agreement. 
In addition, if a multilateral agreement, including but not 
limited to the agreement on textiles and clothing referred to 
in section 101(d)(4) of the Uruguay Round Agreements Act, has 
been or is concluded under the authority of this section among 
countries accounting for a significant part of world trade in 
the articles with respect to which the agreement was concluded, 
the President may also issue, in order to carry out such 
agreement, regulations governing the entry or withdrawal from 
warehouse of the same articles which are the products of 
countries not parties to the agreement, or countries to which 
the United States does not apply the agreement. Nothing herein 
shall affect the authority provided under section 22 of the 
Agricultural Adjustment Act (of 1933) as amended.

   Section 22 of the Agricultural Adjustment Act of 1933, as amended

   [7 U.S.C. 624; Act of May 12, 1933, as added by P.L. 74-320, and 
 amended by Act of Feb. 29, 1936, Act of June 3, 1937, Act of Jan. 25, 
1940, Act of July 3, 1948, Act of June 28, 1950, Act of June 16, 1951, 
          Act of Aug. 7, 1953, P.L. 100-449, and P.L. 103-465]

    Sec. 22. (a) Whenever the Secretary of Agriculture has 
reason to believe that any article or articles are being or are 
practically certain to be imported into the United States under 
such conditions and in such quantities as to render or tend to 
render ineffective, or materially interfere with, any program 
or operation undertaken under this title or the Soil 
Conservation and Domestic Allotment Act, as amended, or section 
32, Public Law Numbered 320, Seventy-Fourth Congress, approved 
August 24, 1935, as amended, or any loan, purchase, or other 
program or operation undertaken by the Department of 
Agriculture, or any agency operating under its direction, with 
respect to any agricultural commodity or product thereof, or to 
reduce substantially the amount of any product processed in the 
United States from any agricultural commodity or product 
thereof with respect to which any such program or operation is 
being undertaken, he shall so advise the President, and, if the 
President agrees that there is reason for such belief, the 
President shall cause an immediate investigation to be made by 
the United States International Trade Commission, which shall 
give precedence to investigations under this section to 
determine such facts. Such investigation shall be made after 
due notice and opportunity for hearing to interested parties, 
and shall be conducted subject to such regulations as the 
President shall specify.
    (b) If, on the basis of such investigation and report to 
him of findings and recommendations made in connection 
therewith, the President finds the existence of such facts, he 
shall by proclamation impose such fees not in excess of 50 per 
centum ad valorem or such quantitative limitations on any 
article or articles which may be entered, or withdrawn from 
warehouse, for consumption as he finds and declares shown by 
such investigation to be necessary in order that the entry of 
such article or articles will not render or tend to render 
ineffective, or materially interfere with, any program or 
operation referred to in subsection (a) of this section, or 
reduce substantially the amount of any product processed in the 
United States from any such agricultural commodity or product 
thereof with respect to which any such program or operation is 
being undertaken: Provided, That no proclamation under this 
section shall impose any limitation on the total quantity of 
any article or articles which may be entered, or withdrawn from 
warehouse, for consumption which reduces such permissible total 
quantity to proportionately less than 50 per centum of the 
total quantity of such article or articles which was entered, 
or withdrawn from warehouse, for consumption during a 
representative period as determined by the President. And 
provided further, That in designating any article or articles, 
the President may describe them by physical qualities, value, 
use, or upon such other bases as he shall determine.
    In any case where the Secretary of Agriculture determines 
and reports to the President with regard to any article or 
articles that a condition exists requiring emergency treatment, 
the President may take immediate action under this section 
without awaiting the recommendations of the International Trade 
Commission, such action to continue in effect pending the 
report and recommendations of the Trade Commission and action 
thereon by the President.
    (c) The fees and limitations imposed by the President by 
proclamation under this section and any revocation, suspension, 
or modification thereof, shall become effective on such date as 
shall be therein specified, and such fees shall be treated for 
administrative purposes and for the purposes of section 32, 
Public Law Numbered 320, Seventy-Fourth Congress, approved 
August 24, 1935, as amended, as duties imposed by the Tariff 
Act of 1930, but such fees shall not be considered as duties 
for the purpose of granting any preferential concession under 
any international obligation of the United States.
    (d) After investigation, report, finding, and declaration 
in the manner provided in the case of a proclamation issued 
pursuant to subsection (b) of this section, any proclamation or 
provision of such proclamation may be suspended or terminated 
by the President whenever he finds and proclaims that the 
circumstances requiring the proclamation or provision thereof 
no longer exist or may be modified by the President whenever he 
finds and proclaims that changed circumstances require such 
modification to carry out the purposes of this section.
    (e) Any decision of the President as to facts under this 
section shall be final.
  (f) No quantitative limitation or fee shall be imposed under 
this section with respect to any article that is the product of 
a WTO member (as defined in section 2(10) of the Uruguay Round 
Agreements Act).
    [Paragraph (2) of section 401 (a) of the Uruguay Round 
Agreements Act provides that subsection (f) as amended shall 
take effect on the date of entry into force of the WTO 
Agreement with respect to the United States, except that with 
respect to wheat, that amendment shall take effect on the later 
of such date or September 12, 1995.]

                   Tariff-Rate Quotas and Safeguards

       (Sections 404 and 405 of the Uruguay Round Agreements Act)

    [19 U.S.C. 3601, 3602; P.L. 103-465, as amended by P.L. 104-295]

SEC. 404. ADMINISTRATION OF TARIFF-RATE QUOTAS.

  (a) Orderly Marketing.--In implementing the tariff-rate 
quotas set out in Schedule XX for the entry, or withdrawal from 
warehouse, for consumption of goods in the United States, the 
President shall take such action as may be necessary to ensure 
that imports of agricultural products do not disrupt the 
orderly marketing of commodities in the United States.
  (b) Inadequate Supply.--Where imports of an agricultural 
product are subject to a tariff-rate quota, and where the 
President determines and proclaims that the supply of the same 
or directly competitive or substitutable agricultural product 
will be inadequate, because of a natural disaster, disease, or 
major national market disruption, to meet domestic demand at 
reasonable prices, the President may temporarily increase the 
quantity of imports of the agricultural product that is subject 
to the in-quota rate of duty established under the tariff-rate 
quota.
  (c) Monitoring.--The Secretary of Agriculture shall monitor 
the domestic supply of agricultural products subject to a 
tariff-rate quota as the Secretary considers appropriate and 
shall advise the President when the domestic supply of the 
products and substitutable products combined with the estimated 
imports of the products under the tariff-rate quota may be 
inadequate to meet domestic demand at reasonable prices.
    (d) Coverage of Tariff-Rate Quotas.--
          (1) Exclusions.--The President may, subject to terms 
        and conditions determined appropriate by the President, 
        provide that the entry, or withdrawal from warehouse, 
        for consumption in the United States of an agricultural 
        product shall not be subject to the over-quota rate of 
        duty established under a tariff-rate quota if the 
        agricultural product--
                  (A) is imported by, or for the account of, 
                any agency of the United States or of any 
                foreign embassy;
                  (B) is imported as a sample for taking 
                orders, for the personal use of the importer, 
                or for the testing of equipment;
                  (C) is a commercial sample or is entered for 
                exhibition, display, or sampling at a trade 
                fair or for research; or
                  (D) is a blended syrup provided for in 
                subheadings 1702.20.28, 1702.30.28, 1702.40.28, 
                1702.60.28, 1702.90.58, 1806.20.92, 1806.20.93, 
                1806.90.38, 1806.90.40, 2101.10.38, 2101.20.38, 
                2106.90.38, or 2106.90.67 of Schedule XX, if 
                entered from a foreign trade zone by a foreign 
                trade zone user whose facilities were in 
                operation on June 1, 1990, to the extent that 
                the annual quantity entered into the customs 
                territory from such zone does not contain a 
                quantity of sugar of nondomestic origin greater 
                than the quantity authorized by the Foreign 
                Trade Zones Board for processing in that zone 
                during calendar year 1985.
          (2) Reclassification.--Subject to the consultation 
        and layover requirements of section 115, the President 
        may proclaim a modification to the coverage of a 
        tariff-rate quota for any agricultural product if the 
        President determines the modification is necessary or 
        appropriate to conform the tariff-rate quota to 
        Schedule XX as a result of a reclassification of any 
        item by the Secretary of the Treasury.
          (3) Allocation.--The President may allocate the in-
        quota quantity of a tariff-rate quota for any 
        agricultural product among supplying countries or 
        customs areas and may modify any allocation as 
        determined appropriate by the President.
          (4) Bilateral agreement.--The President may proclaim 
        an increase in the tariff-rate quota for beef if the 
        President determines that an increase is necessary to 
        implement--
                  (A) the March 24, 1994, agreement between the 
                United States and Argentina; or
                  (B) the March 9, 1994, agreement between the 
                United States and Uruguay.
          (5) Continuation of sugar headnote.--The President is 
        authorized to proclaim additional United States note 3 
        to chapter 17 of the HTS, and to proclaim the 
        modifications to the note, as determined appropriate by 
        the President to reflect Schedule XX.
  [(e) Conforming Amendments.--Amendments to section 213(d) of 
the Caribbean Basin Economic Recovery Act, section 204 of the 
Andean Trade Preference Act, section 503 of the Trade Act of 
1974, General Note 3(a)(iv) of the HTS, section 313 of the 
Tariff Act of 1930, and Section 358e(f)(6) of the Agricultural 
Adjustment Act of 1938 (reprinted elsewhere).]

SEC. 405. SPECIAL AGRICULTURAL SAFEGUARD AUTHORITY.

  (a) Determination of Trigger Levels.--Consistent with Article 
5 as determined by the President, the President shall cause to 
be published in the Federal Register--
          (1) the list of special safeguard agricultural goods 
        not later than the date of entry into force of the WTO 
        Agreement with respect to the United States; and
          (2) for each special safeguard agricultural good--
                  (A) the trigger level specified in 
                subparagraph 1(a) of Article 5, on an annual 
                basis;
                  (B) the trigger price specified in 
                subparagraph 1(b) of Article 5; and
                  (C) the relevant period.
  (b) Determination of Safeguard.--If the President determines 
with respect to a special safeguard agricultural good that it 
is appropriate to impose--
          (1) the price-based safeguard in accordance with 
        subparagraph 1(b) of Article 5; or
          (2) the volume-based safeguard in accordance with 
        subparagraph 1(a) of Article 5,
the President shall, consistent with Article 5 as determined by 
the President, determine the amount of the duty to be imposed, 
the period such duty shall be in effect, and any other terms 
and conditions applicable to the duty.
  (c) Imposition of Safeguard.--The President shall direct the 
Secretary of the Treasury to impose a duty on a special 
safeguard agricultural good entered, or withdrawn from 
warehouse, for consumption in the United States in accordance 
with a determination made under subsection (b).
  (d) No Simultaneous Safeguard.--A duty may not be in effect 
for a special safeguard agricultural good pursuant to this 
section during any period in which such good is the subject of 
any action proclaimed pursuant to section 202 or 203 of the 
Trade Act of 1974 (19 U.S.C. 2252 or 2253).
  (e) Exclusion of NAFTA Countries.--The President may exempt 
from any duty imposed under this section any good originating 
in a NAFTA country (as determined in accordance with section 
202 of the North American Free Trade Agreement Implementation 
Act (19 U.S.C. 3332)).
  (f) Advice of Secretary of Agriculture.--The Secretary of 
Agriculture shall advise the President on the implementation of 
this section.
  (g) Termination Date.--This section shall cease to be 
effective on the date, as determined by the President, that the 
special safeguard provisions of Article 5 are no longer in 
force with respect to the United States.
  (h) Definitions.--For purposes of this section--
          (1) the term ``Article 5'' means Article 5 of the 
        Agreement on Agriculture described in section 
        101(d)(2);
          (2) the term ``relevant period'' means the period 
        determined by the President to be applicable to a 
        special safeguard agricultural good for purposes of 
        applying this section; and
          (3) the term ``special safeguard agricultural good'' 
        means an agricultural good on which an additional duty 
        may be imposed pursuant to the special safeguard 
        provisions of Article 5.

                 Reciprocal Meat Inspection Requirement

           (Section 20(h) of the Federal Meat Inspection Act)

  [21 U.S.C. 620; P.L. 90-201 as added by P.L. 100-418, section 4604]

SEC. 20.

           *       *       *       *       *       *       *


    (h)(1) As used in this subsection:
          (A) The term ``meat articles'' means carcasses, meat 
        and meat food products of cattle, sheep, swine, goats, 
        horses, mules, or other equines, that are capable of 
        use as human food.
          (B) The term ``standards'' means inspection, building 
        construction, sanitary, quality, species verification, 
        residue, and other standards that are applicable to 
        meat articles.
    (2) On request of the Committee on Agriculture or the 
Committee on Ways and Means of the House of Representatives or 
the Committee on Agriculture, Nutrition, and Forestry or the 
Committee on Finance of the Senate, or at the initiative of the 
Secretary, the Secretary shall, as soon as practicable, 
determine whether a particular foreign country applies 
standards for the importation of meat articles from the United 
States that are not related to public health concerns about 
end-product quality that can be substantiated by reliable 
analytical methods.
    (3) If the Secretary determines that a foreign country 
applies standards described in paragraph (2)--
          (A) the Secretary shall consult with the United 
        States Trade Representative; and
          (B) within 30 days after the determination of the 
        Secretary under paragraph (2), the Secretary and the 
        United States Trade Representative shall recommend to 
        the President whether action should be taken under 
        paragraph (4).
    (4) Within 30 days after receiving a recommendation for 
action under paragraph (3), the President shall, if and for 
such time as the President considers appropriate, prohibit 
imports into the United States of any meat articles produced in 
such foreign country unless it is determined that the meat 
articles produced in that country meet the standards applicable 
to meat articles in commerce within the United States.
    (5) The action authorized under paragraph (4) may be used 
instead of, or in addition to, any other action taken under any 
other law.

           Sugar Tariff-Rate Quotas Under Headnote Authority

[Additional U.S. Notes of Chapter 17 of the Harmonized Tariff Schedule 
                         of the United States]

              Chapter 17.--Sugars and Sugar Confectionery

                         Additional U.S. Notes

    1. The term ``degree'' as used in the ``Rates of Duty'' 
columns of this chapter means International Sugar Degree as 
determined by polarimetric test performed in accordance with 
procedures recognized by the International Commission for 
Uniform Methods of Sugar Analysis (ICUMSA).
    2. For the purposes of this schedule, the term ``articles 
containing over 65 percent by dry weight of sugar described in 
additional U.S. note 2 to chapter 17'' means articles 
containing over 65 percent by dry weight of sugars derived from 
sugar cane or sugar beets, whether or not mixed with other 
ingredients, capable of being further processed or mixed with 
similar or other ingredients, and not prepared for marketing to 
the ultimate consumer in the identical form and package in 
which imported.
    3. For the purposes of this schedule, the term ``articles 
containing over 10 percent by dry weight of sugar described in 
additional U.S. note 3 to chapter 17'' means articles 
containing over 10 percent by dry weight of sugars derived from 
sugar cane or sugar beets, whether or not mixed with other 
ingredients, except (a) articles not principally of crystalline 
structure or not in dry amorphous form, the foregoing that are 
prepared for marketing to the ultimate consumer in the 
identical form and package in which imported; (b) blended 
syrups containing sugars derived from sugar cane or sugar 
beets, capable of being further processed or mixed with similar 
or other ingredients, and not prepared for marketing to the 
ultimate consumer in the identical form and package in which 
imported; (c) articles containing over 65 percent by dry weight 
of sugars derived from sugar cane or sugar beets, whether or 
not mixed with other ingredients, capable of being further 
processed or mixed with similar or other ingredients, and not 
prepared for marketing to the ultimate consumer in the 
identical form and package in which imported; or (d) cake 
decorations and similar products to be used in the same 
condition as imported without any further processing other than 
the direct application to individual pastries or confections, 
finely ground or masticated coconut meat or juice thereof mixed 
with those sugars, and sauces and preparations therefor.
    4. For the purposes of this schedule, the term ``blended 
syrups described in additional U.S. note 4 to chapter 17'' 
means blended syrups containing sugars derived from sugar cane 
or sugar beets, capable of being further processed or mixed 
with similar or other ingredients, and not prepared for 
marketing to the ultimate consumer in the identical form and 
package in which imported.
    5. (a)(i) The aggregate quantity of raw cane sugar entered, 
or withdrawn from warehouse for consumption, under subheading 
1701.11.10, during any fiscal year, shall not exceed in the 
aggregate an amount (expressed in terms of raw value), not less 
than 1,117,195 metric tons, as shall be established by the 
Secretary of Agriculture (hereinafter referred to as ``the 
Secretary''), and the aggregate quantity of sugars, syrups and 
molasses entered, or withdrawn from warehouse for consumption, 
under subheadings 1701.12.10, 1701.91.10, 1701.99.10, 
1702.90.10 and 2106.90.44, during any fiscal year, shall not 
exceed in the aggregate an amount (expressed in terms of raw 
value), not less than 22,000 metric tons, as shall be 
established by the Secretary. With either the aggregate 
quantity for raw cane sugar or the aggregate quantity for 
sugars, syrups and molasses other than raw cane sugar, the 
Secretary may reserve a quota quantity for the importation of 
specialty sugars as defined by the United States Trade 
Representative.
    (ii) Whenever the Secretary believes that domestic supplies 
of sugars may be inadequate to meet domestic demand at 
reasonable prices, the Secretary may modify any quantitative 
limitations which have previously been established under this 
note but may not reduce the total amounts below the amounts 
provided for in subdivision (i) hereof.
    (iii) The Secretary shall inform the Secretary of the 
Treasury of any determination made under this note. Notice of 
such determinations shall be published in the Federal Register.
    (iv) Sugar entering the United States during a quota period 
established under this note may be charged to the previous or 
subsequent quota period with the written approval of the 
Secretary.
    (b)(i) The quota amounts established under subdivision (a) 
may be allocated among supplying countries and areas by the 
United States Trade Representative.
    (ii) The United States Trade Representative, after 
consultation with the Secretaries of State and Agriculture, may 
modify, suspend (for all or part of the quota amount), or 
reinstate the allocations provided for in this subdivision 
(including the addition or deletion of any country or area) if 
he finds that such action is appropriate to carry out the 
rights or obligations of the United States under any 
international agreement to which the United States is a party 
or is appropriate to promote the economic interests of the 
United States.
    (iii) The United States Trade Representative shall inform 
the Secretary of the Treasury of any such action and shall 
publish notice thereof in the Federal Register. Such action 
shall not become effective until the day following the date of 
publication of such notice in the Federal Register or such 
later date as may be specified by the United States Trade 
Representative.
    (iv) The United States Trade Representative may promulgate 
regulations appropriate to provide for the allocations 
authorized pursuant to this note. Such regulations may, among 
other things, provide for the issuance of certificates of 
eligibility to accompany any sugars, syrups or molasses 
(including any speciality sugars) imported from any country or 
area for which an allocation has been provided and for such 
minimum quota amounts as may be appropriate to provide 
reasonable access to the U.S. market for articles the product 
of those countries or areas having small allocations.
    (c) For purposes of this note, the term raw value means the 
equivalent of such articles in terms of ordinary commercial raw 
sugar testing 96 degrees by the polariscope as determined in 
accordance with regulations or instructions issued by the 
Secretary of the Treasury. Such regulations or instructions 
may, among other things, provide: (i) for the entry of such 
articles pending a final determination of polarity; and (ii) 
that positive or negative adjustments for differences in 
preliminary and final raw values be made in the same or 
succeeding quota periods. The principal grades and types of 
sugar shall be translated into terms of raw value in the 
following manner--
          (A) For articles described in subheadings 1701.11.05, 
        1701.11.10, 1701.11.20, 1701.11.50, 1701.12.05, 
        1701.12.10, 1701.12.50, 1701.91.05, 1701.91.10, 
        1701.91.30, 1701.99.05, 1701.99.10, 1701.99.50, 
        2106.90.42, 2106.90.44 and 2106.90.46 by multiplying 
        the number of kilograms thereof by the greater of 0.93, 
        or 1.07 less 0.0175 for each degree of polarization 
        under 100 degrees (and fractions of a degree in 
        proportion).
          (B) For articles described in subheadings 1702.90.05, 
        1702.90.10 and 1702.90.20, by multiplying the number of 
        kilograms of the total sugars thereof (the sum of the 
        sucrose and reducing or invert sugars) by 1.07.
          (C) The Secretary of the Treasury shall establish 
        methods for translating sugar into terms of raw value 
        for any special grade or type of sugar, syrup, or 
        molasses for which he/she determines that the raw value 
        cannot be measured adequately under the above 
        provisions.
    6. Raw cane sugar classifiable in subheading 1701.11.20 
shall be entered only to be used for the production (other than 
by distillation) of polyhydric alcohols, except polyhydric 
alcohols for use as a substitute for sugar in human food 
consumption, or to be refined and reexported in refined form or 
in sugar-containing products, or to be substituted for 
domestically produced raw cane sugar that has been or will be 
exported. The Secretary of Agriculture may issue licenses for 
such entries and may promulgate such regulations (including any 
terms, conditions, certifications, bonds, civil penalties, or 
other limitations) as are appropriate to ensure that sugar 
entered under subheading 1701.11.20 is used only for such 
purposes.
    7. The aggregate quantity of articles containing over 65 
percent by dry weight of sugars described in additional U.S. 
note 2 to chapter 17, entered under subheadings 1701.91.44, 
1702.90.64, 1704.90.64, 1806.10.24, 1806.10.45, 1806.20.71, 
1806.90.45, 1901.20.20, 1901.20.55, 1901.90.52, 2101.12.44, 
2101.20.44, 2106.90.74 and 2106.90.92 during the 12-month 
period from October 1 in any year to the following September 
30, inclusive, shall be none and no such articles shall be 
classifiable therein.
    8. The aggregate quantity of articles containing over 10 
percent by dry weight of sugars described in additional U.S. 
note 3 to chapter 17, entered under subheadings 1701.91.54, 
1704.90.74, 1806.20.75, 1806.20.95, 1806.90.56, 1901.90.56, 
2101.12.54, 2101.20.54, 2106.90.78 and 2106.90.95 during the 
12-month period from October 1, in any year to the following 
September 30, inclusive, shall be exceed 64,709 metric tons 
(articles the product of Mexico shall not be permitted or 
included under this quantitative limitation and no such 
articles shall be classifiable therein).
    9. The aggregate quantity of blended syrups described in 
additional U.S. note 4 to chapter 17, the foregoing goods 
entered under subheadings 1704.20.24, 1702.30.24, 1702.40.24, 
1702.60.24, 1702.90.54, 1806.20.91, 1806.90.35, 2101.12.34, 
2101.20.34, 2106.90.68 and 2106.90.89 during the 12-month 
period from October 1, in any year to the following September 
30, inclusive, shall be none and no such articles shall be none 
and no such articles shall be classifiable therein.
    10. Heading 1703 does not include products derived from 
sugar cane or sugar beet and containing soluble non-sugar 
solids (excluding any foreign substance that may have been 
added or developed in the product) equal to percent or less by 
weight of the total soluble solids.
    11. For the purposes of subheading 1704.90.25, ``cough 
drops'' must contain a minimum of 5 mg per dose of menthol, of 
eucalyptol, or of a combination of menthol, and of eucalptol, 
or of a combination of menthol and eucalyptol.

Import Prohibitions on Certain Agricultural Commodities Under Marketing 
                                 Orders

      (Section 8e of the Agricultural Adjustment Act, as amended)

  [7 U.S.C. 608e-1; Act of Mar. 12, 1933, as amended by Act of Aug. 31, 
1954, P.L. 87-128, P.L. 91-670, P.L. 95-133, P.L. 97-312, P.L. 100-418, 
                           and P.L. 101-624]

SEC. 8E. IMPORT PROHIBITIONS ON TOMATOES, AVOCADOS, LIMES, ETC; RULES 
                    AND REGULATIONS.

    (a) Subject to the provisions of subsections (c) and (d) 
and notwithstanding any other provision of law, whenever a 
marketing order issued by the Secretary of Agriculture pursuant 
to section 608c of this title contains any terms or conditions 
regulating the grade, size, quality or maturity of tomatoes, 
raisins, olives (other than Spanish-style green olives), 
prunes, avocados, mangoes, limes, grapefruit, green peppers, 
Irish potatoes, cucumbers, oranges, onions, walnuts, dates, 
filberts, table grapes, eggplants, kiwifruit, nectarines, 
plums, pistachios, or apples produced in the United States the 
importation into the United States of any such commodity, other 
than dates for processing, during the period of time such order 
is in effect shall be prohibited unless it complies with the 
grade, size, quality, and maturity provisions of such order or 
comparable restrictions promulgated hereunder: Provided, That 
this prohibition shall not apply to such commodities when 
shipped into the continental United States from the 
Commonwealth of Puerto Rico or any Territory or possession of 
the United States where this chapter has force and effect; 
Provided further, That whenever two or more such marketing 
orders regulating the same agricultural commodity produced in 
different areas of the United States are concurrently in 
effect, the importation into the United States of any such 
commodity, other than dates for processing, shall be prohibited 
unless it complies with the grade, size, quality, and maturity 
provisions of the order which, as determined by the Secretary 
of Agriculture, regulates the commodity produced in the area 
with which the imported commodity is in most direct 
competition. Such prohibition shall not become effective until 
after the giving of such notice as the Secretary of Agriculture 
determines reasonable, which shall not be less than three days. 
In determining the amount of notice that is reasonable in the 
case of tomatoes the Secretary of Agriculture shall give due 
consideration to the time required for their transportation and 
entry into the United States after picking. Whenever the 
Secretary of Agriculture finds that the application of the 
restrictions under a marketing order to an imported commodity 
is not practicable because of variations in characteristics 
between the domestic and imported commodity he shall establish 
with respect to the imported commodity, other than dates for 
processing, such grade, size, quality, and maturity 
restrictions by varieties, types, or other classifications as 
he finds will be equivalent or comparable to those imposed upon 
the domestic commodity under such order. The Secretary of 
Agriculture may promulgate such rules and regulations as he 
deems necessary, to carry out the provisions of this section. 
Any person who violates any provision of this section or of any 
rule, regulation, or order promulgated hereunder shall be 
subject to a forfeiture in the amount prescribed in section 
608a(5) of this title or, upon conviction, a penalty in the 
amount prescribed in section 608c(14) of this title, or to both 
such forfeiture and penalty.
    (b)(1) The Secretary may provide for a period of time (not 
to exceed 35 days) in addition to the period of time covered by 
a marketing order during which the marketing order requirements 
would be in effect for a particular commodity during any year 
if the Secretary determines that such additional period of time 
is necessary--
          (A) to effectuate the purpose of this Act; and
          (B) to prevent the circumvention of the grade, size, 
        quality, or maturity standards of a seasonal marketing 
        order applicable to a commodity produced in the United 
        States by imports of such commodity.
    (2) In making the determination required by paragraph (1), 
the Secretary, through notice and comment procedures, shall 
consider--
          (A) to what extent, during the previous year, imports 
        of a commodity that did not meet the requirements of a 
        marketing order applicable to such commodity were 
        marketed in the United States during the period that 
        such marketing order requirements were in effect for 
        available domestic commodities (or would have been 
        marketed during such time if not for any additional 
        period established by the Secretary);
          (B) if the importation into the United States of such 
        commodity did, or was likely to, circumvent the grade, 
        size, quality or maturity standards of a seasonal 
        marketing order applicable to such commodity produced 
        in the United States; and
          (C) the availability and price of commodities of the 
        variety covered by the marketing order during any 
        additional period the marketing order requirements are 
        to be in effect.
    (3) An additional period established by the Secretary in 
accordance with this subsection shall be--
          (A) announced not later than 30 days before the date 
        such additional period is to be in effect; and
          (B) reviewed by the Secretary on request, through 
        notice and comment procedures, at least every 3 years 
        in order to determine if the additional period is still 
        needed to prevent circumvention of the seasonal 
        marketing order by imported commodities.
    (4) For the purposes of carrying out this subsection, the 
Secretary is authorized to make such reasonable inspections as 
may be necessary.
    (c) Prior to any import prohibition or regulation under 
this section being made effective with respect to any 
commodity--
          (1) the Secretary of Agriculture shall notify the 
        United States Trade Representative of such import 
        prohibition or regulation; and
          (2) the United States Trade Representative shall 
        advise the Secretary of Agriculture, within 60 days of 
        the notification under paragraph (1), to ensure that 
        the application of the grade, size, quality, and 
        maturity provisions of the relevant marketing order, or 
        comparable restrictions, to imports is not inconsistent 
        with United States international obligations under any 
        trade agreement, including the General Agreement on 
        Tariffs and Trade.
    (d) The Secretary may proceed with the proposed prohibition 
or regulation if the Secretary receives the advice and 
concurrence of the United States Trade Representative within 60 
days of the notification under subsection (c)(1).

  B. AUTHORITIES TO RESTRICT IMPORTS UNDER CERTAIN ENVIRONMENTAL LAWS

            Marine Mammal Protection Act of 1972, as amended

                               [Excerpts]

 [16 U.S.C. 1371, 1411-1412, and 1415-1417; P.L. 92-522, as amended by 
 P.L. 93-205, P.L. 94-265, P.L. 95-136, P.L. 96-470, P.L. 97-58, P.L. 
  97-389, P.L. 98-364, P.L. 102-523, P.L. 102-582, P.L. 102-587, P.L. 
                 103-238, P.L. 105-18, and P.L. 105-42]

         TITLE I--CONSERVATION AND PROTECTION OF MARINE MAMMALS

                       moratorium and exceptions

    Sec. 101. (a) There shall be a moratorium on the taking and 
importation of marine mammals and marine mammal products, 
commencing on the effective date of this Act, during which time 
no permit may be issued for the taking of any marine mammal and 
no marine mammal or marine mammal product may be imported into 
the United States except in the following cases:
          (1) Consistent with the provisions of section 104, 
        permits may be issued by the Secretary for taking, and 
        importation for purposes of scientific research, public 
        display, photography for educational or commercial 
        purposes, or enhancing the survival or recovery of a 
        species or stock, or for importation of polar bear 
        parts (other than internal organs) taken in sport hunts 
        in Canada. Such permits, except permits issued under 
        section 104(c)(5), may be issued if the taking or 
        importation proposed to be made is first reviewed by 
        the Marine Mammal Commission and the Committee of 
        Scientific Advisors on Marine Mammals established under 
        title II. The Commission and Committee shall recommend 
        any proposed taking or importation, other than 
        importation under section 104(c)(5), which is 
        consistent with the purposes and policies of section 2 
        of this Act. If the Secretary issues such a permit for 
        importation, the Secretary shall issue to the importer 
        concerned a certificate to that effect in such form as 
        the Secretary of the Treasury prescribes, and such 
        importation may be made upon presentation of the 
        certificate to the customs officer concerned.
          (2) Marine mammals may be taken incidentally in the 
        course of commercial fishing operations and permits may 
        be issued thereof pursuant to section 104 of this 
        title, subject to regulations prescribed by the 
        Secretary in accordance with section 103 hereof, or in 
        lieu of such permits, authorizations may be granted 
        therefor under section 118, subject to regulations 
        prescribed under that section by the Secretary without 
        regard to section 103. Such authorizations may be 
        granted under title III with respect to purse seine 
        fishing for yellowfin tuna in the eastern tropical 
        Pacific Ocean, subject to regulations prescribed under 
        that title by the Secretary without regard to section 
        103. In any event it shall be the immediate goal that 
        the incidental kill or incidental serious injury of 
        marine mammals permitted in the course of commercial 
        fishing operations be reduced to insignificant levels 
        approaching a zero mortality and serious injury rate. 
        The Secretary of the Treasury shall ban the importation 
        of commercial fish or products from fish which have 
        been caught with commercial fishing technology which 
        results in the incidental kill or incidental serious 
        injury of ocean mammals in excess of United States 
        standards. For purposes of applying the preceding 
        sentence, the Secretary--
                  (A) shall insist on reasonable proof from the 
                government of any nation from which fish or 
                fish products will be exported to the United 
                States of the effects on ocean mammals of the 
                commercial fishing technology in use for such 
                fish or fish products exported from such nation 
                to the United States;
                  (B) in the case of yellowfin tuna harvested 
                with purse seines nets in the eastern tropical 
                Pacific Ocean, and products therefrom, to be 
                exported to the United States, shall require 
                that the government of the exporting nation 
                provide documentary evidence that--
                          (i)(I) the tuna or products therefrom 
                        were not banned from importation under 
                        this paragraph before the effective 
                        date of section 4 of the International 
                        Dolphin Conservation Program Act; or
                          (II) the tuna or products therefrom 
                        were harvested after the effective date 
                        of section 4 of the International 
                        Dolphin Conservation Program Act by 
                        vessels of a nation which participates 
                        in the International Dolphin 
                        Conservation Program, and such 
                        harvesting nation is either a member of 
                        the Inter-American Tropical Tuna 
                        Commission or has initiated (and within 
                        6 months thereafter completed) all 
                        steps required of applicant nations, in 
                        accordance with article V, paragraph 3 
                        of the Convention establishing the 
                        Inter-American Tropical Tuna 
                        Commission, to become a member of that 
                        organization;
                          (ii) such nation is meeting the 
                        obligations of the International 
                        Dolphin Conservation Program and the 
                        obligations of membership in the Inter-
                        American Tropical Tuna Commission, 
                        including all financial obligations; 
                        and
                          (iii) the total dolphin mortality 
                        limits, and per-stock per-year dolphin 
                        mortality limits permitted for that 
                        nation's vessels under the 
                        International Dolphin Conservation 
                        Program do not exceed the limits 
                        determined for 1997, or for any year 
                        thereafter, consistent with the 
                        objective of progressively reducing 
                        dolphin mortality to a level 
                        approaching zero through the setting of 
                        annual limits and the goal of 
                        eliminating dolphin mortality, and 
                        requirements of the International 
                        Dolphin Conservation Program;
                  (C) shall not accept such documentary 
                evidence if--
                          (i) the government of the harvesting 
                        nation does not provide directly or 
                        authorize the Inter-American Tropical 
                        Tuna Commission to release complete and 
                        accurate information to the Secretary 
                        in a timely manner--
                                  (I) to allow determination of 
                                compliance with the 
                                International Dolphin 
                                Conservation Program; and
                                  (II) for the purposes of 
                                tracking and verifying 
                                compliance with the minimum 
                                requirements established by the 
                                Secretary in regulations 
                                promulgated under subsection 
                                (f) of the Dolphin Protection 
                                Consumer Information Act (16 
                                U.S.C. 1385(f)); or
                          (ii) after taking into consideration 
                        such information, findings of the 
                        Inter-American Tropical Tuna 
                        Commission, and any other relevant 
                        information, including information that 
                        a nation is consistently failing to 
                        take enforcement actions on violations 
                        which diminish the effectiveness of the 
                        International Dolphin Conservation 
                        Program, the Secretary, in consultation 
                        with the Secretary of State, finds that 
                        the harvesting nation is not in 
                        compliance with the International 
                        Dolphin Conservation Program.
                  (D) shall require the government of any 
                intermediary nation to certify and provide 
                reasonable proof to the Secretary that it has 
                not imported, within the preceding six months, 
                any yellowfin tuna or yellowfin tuna products 
                that are subject to a direct ban on importation 
                to the United States under subparagraph (B);
                  (E) shall, six months after importation of 
                yellowfin tuna or tuna products has been banned 
                under this section, certify such fact to the 
                President, which certification shall be deemed 
                to be a certification for the purposes of 
                section 8(a) of the Fishermen's Protective Act 
                of 1967 (22 U.S.C. 1978(a)) for as long as such 
                ban is in effect; and
                  (F)(i) except as provided in clause (ii), in 
                the case of fish or products containing fish 
                harvested by a nation whose fishing vessels 
                engage in high seas driftnet fishing, shall 
                require that the government of the exporting 
                nation provide documentary evidence that the 
                fish or fish product was not harvested with a 
                large-scale driftnet in the South Pacific Ocean 
                after July 1, 1991, or in any other water of 
                the high seas after January 1, 1993, and
                  (ii) in the case of tuna or a product 
                containing tuna harvested by a nation whose 
                fishing vessels engage in high seas driftnet 
                fishing, shall require that the government of 
                the exporting nation provide documentary 
                evidence that the tuna or tuna product was not 
                harvested with a large-scale driftnet anywhere 
                on the high seas after July 1, 1991.
        For purposes of subparagraph (F), the term ``driftnet'' 
        has the meaning given such term in section 4003 of the 
        Driftnet Impact Monitoring, Assessment, and Control Act 
        of 1987 (16 U.S.C. 1822 note), except that, until 
        January 1, 1994, the term ``driftnet'' does not include 
        the use in the northeast Atlantic Ocean of gillnets 
        with a total length not to exceed 5 kilometers if the 
        use is in accordance with regulations adopted by the 
        European Community pursuant to the October 28, 1991, 
        decision by the Council of Fisheries Ministers of the 
        Community.
          (3)(A) The Secretary, on the basis of the best 
        scientific evidence available and in consultation with 
        the Marine Mammal Commission, is authorized and 
        directed, from time to time, having due regard to the 
        distribution, abundance, breeding habits, and times and 
        lines of migratory movements of such marine mammals, to 
        determine when, to what extent, if at all, and by what 
        means, it is compatible with this Act to waive the 
        requirements of this section so as to allow taking, or 
        importing of any marine mammal, or any marine mammal 
        product, and to adopt suitable regulations, issue 
        permits, and make determinations in accordance with 
        sections 102, 103, 104, and 111 of this title 
        permitting and governing such taking and importing, in 
        accordance with such determinations: Provided, however, 
        That the Secretary, in making such determinations, must 
        be assured that the taking of such marine mammal is in 
        accord with sound principles of resource protection and 
        conservation as provided in the purposes and policies 
        of this Act: Provided further, however, That no marine 
        mammal or no marine mammal product may be imported into 
        the United States unless the Secretary certifies that 
        the program for taking marine mammals in the country of 
        origin is consistent with the provisions and policies 
        of this Act. Products of nations not so certified may 
        not be imported into the United States for any purpose, 
        including processing for exportation.
          (B) Except for scientific research purposes, 
        photography for educational or commercial purposes, or 
        enhancing the survival or recovery of a species or 
        stock as provided for in paragraph (1) of this 
        subsection, or as provided for under paragraph (5) of 
        this subsection, during the moratorium no permit may be 
        issued for the taking of any marine mammal which has 
        been designated by the Secretary as depleted, and no 
        importation may be made of any such mammal.
          (4)(A) Except as provided in subparagraphs (B) and 
        (C), the provisions of this Act shall not apply to the 
        use of measures--
                  (i) by the owner of fishing gear or catch, or 
                an employee or agent of such owner, to deter a 
                marine mammal from damaging the gear or catch;
                  (ii) by the owner of other private property, 
                or an agent, bailee, or employee of such owner, 
                to deter a marine mammal from damaging private 
                property;
                  (iii) by any person, to deter a marine mammal 
                from endangering personal safety; or
                  (iv) by a government employee, to deter a 
                marine mammal from damaging public property,
        so long as such measures do not result in the death or 
        serious injury of a marine mammal.
          (B) The Secretary shall, through consultation with 
        appropriate experts, and after notice and opportunity 
        for public comment, publish in the Federal Register a 
        list of guidelines for use in safely deterring marine 
        mammals. In the case of marine mammals listed as 
        endangered species or threatened species under the 
        Endangered Species Act of 1973, the Secretary shall 
        recommend specific measures which may be used to 
        nonlethally deter marine mammals. Actions to deter 
        marine mammals consistent with such guidelines or 
        specific measures shall not be a violation of this Act.
          (C) If the Secretary determines, using the best 
        scientific information available, that certain forms of 
        deterrence have a significant adverse effect on marine 
        mammals, the Secretary may prohibit such deterrent 
        methods, after notice and opportunity for public 
        comment, through regulation under this Act.
          (D) The authority to deter marine mammals pursuant to 
        subparagraph (A) applies to all marine mammals, 
        including all stocks designated as depleted under this 
        Act.
          (5)(A) Upon request therefor by citizens of the 
        United States who engage in a specified activity (other 
        than commercial fishing) within a specified 
        geographical region, the Secretary shall allow, during 
        periods of not more than five consecutive years each, 
        the incidental, but not intentional, taking by citizens 
        while engaging in that activity within that region of 
        small numbers of marine mammals of a species or 
        population stock if the Secretary, after notice (in the 
        Federal Register and in newspapers of general 
        circulation, and through appropriate electronic media, 
        in the coastal areas that may be affected by such 
        activity) and opportunity for public comment--
                  (i) finds that the total of such taking 
                during each five-year (or less) period 
                concerned will have a negligible impact on such 
                species or stock and will not have an 
                unmitigable adverse impact on the availability 
                of such species or stock for taking for 
                subsistence uses pursuant to subsection (b) of 
                this section or section 109(f) of this title 
                or, in the case of a cooperative agreement 
                under both this Act and the Whaling Convention 
                Act of 1949 [16 U.S.C.A. Sec. 916 et seq.], 
                pursuant to section 112(c) of this title; and
                  (ii) prescribes regulations setting forth--
                          (I) permissible methods of taking 
                        pursuant to such activity, and other 
                        means of effecting the least 
                        practicable adverse impact on such 
                        species or stock and its habitat, 
                        paying particular attention to 
                        rookeries, mating grounds, and areas of 
                        similar significance, and on the 
                        availability of such species or stock 
                        for subsistence uses; and
                          (II) requirements pertaining to the 
                        monitoring and reporting of such 
                        taking.
          (B) The Secretary shall withdraw, or suspend for a 
        time certain (either on an individual or class basis, 
        as appropriate) the permission to take marine mammals 
        under subparagraph (A) pursuant to a specified activity 
        within a specified geographical region if the Secretary 
        finds, after notice and opportunity for public comment 
        (as required under subparagraph (A) unless subparagraph 
        (C)(i) applies), that--
                  (i) the regulations prescribed under 
                subparagraph (A) regarding methods of taking, 
                monitoring, or reporting are not being 
                substantially complied with by a person 
                engaging in such activity; or
                  (ii) the taking allowed under subparagraph 
                (A) pursuant to one or more activities within 
                one or more regions is having, or may have, 
                more than a negligible impact on the species or 
                stock concerned.
          (C)(i) The requirement for notice and opportunity for 
        public comment in subparagraph (B) shall not apply in 
        the case of a suspension of permission to take if the 
        Secretary determines that an emergency exists which 
        poses a significant risk to the well-being of the 
        species or stock concerned.
          (ii) Sections 103 and 104 of this title shall not 
        apply to the taking of marine mammals under the 
        authority of this paragraph.
          (D)(i) Upon request therefor by citizens of the 
        United States who engage in a specified activity (other 
        than commercial fishing) within a specific geographic 
        region, the Secretary shall authorize, for periods of 
        not more than 1 year, subject to such conditions as the 
        Secretary may specify, the incidental, but not 
        intentional, taking by harassment of small numbers of 
        marine mammals of a species or population stock by such 
        citizens while engaging in that activity within that 
        region if the Secretary finds that such harassment 
        during each period concerned--
                  (I) will have a negligible impact on such 
                species or stock, and
                  (II) will not have an unmitigable adverse 
                impact on the availability of such species or 
                stock for taking for subsistence uses pursuant 
                to subsection (b), or section 109(f) or 
                pursuant to a cooperative agreement under 
                section 119.
          (ii) The authorization for such activity shall 
        prescribe, where applicable--
                  (I) permissible methods of taking by 
                harassment pursuant to such activity, and other 
                means of effecting the least practicable impact 
                on such species or stock and its habitat, 
                paying particular attention to rookeries, 
                mating grounds, and areas of similar 
                significance, and on the availability of such 
                species or stock for taking for subsistence 
                uses pursuant to subsection (b) or section 
                109(f) or pursuant to a cooperative agreement 
                under section 119,
                  (II) the measures that the Secretary 
                determines are necessary to ensure no 
                unmitigable adverse impact on the availability 
                of the species or stock for taking for 
                subsistence uses pursuant to subsection (b) or 
                section 109(f) or pursuant to a cooperative 
                agreement under section 119, and
                  (III) requirements pertaining to the 
                monitoring and reporting of such taking by 
                harassment, including requirements for the 
                independent peer review of proposed monitoring 
                plans or other research proposals where the 
                proposed activity may affect the availability 
                of a species or stock for taking for 
                subsistence uses pursuant to subsection (b) or 
                section 109(f) or pursuant to a cooperative 
                agreement under section 119.
          (iii) The Secretary shall publish a proposed 
        authorization not later than 45 days after receiving an 
        application under this subparagraph and request public 
        comment through notice in the Federal Register, 
        newspapers of general circulation, and appropriate 
        electronic media and to all locally affected 
        communities for a period of 30 days after publication. 
        Not later than 45 days after the close of the public 
        comment period, if the Secretary makes the findings set 
        forth in clause (i), the Secretary shall issue an 
        authorization with appropriate conditions to meet the 
        requirements of clause (ii).
          (iv) The Secretary shall modify, suspend, or revoke 
        an authorization if the Secretary finds that the 
        provisions of clauses (i) or (ii) are not being met.
          (v) A person conducting an activity for which an 
        authorization has been granted under this subparagraph 
        shall not be subject to the penalties of this Act for 
        taking by harassment that occurs in compliance with 
        such authorization.
          (E)(i) During any period of up to 3 consecutive 
        years, the Secretary shall allow the incidental, but 
        not the intentional, taking by persons using vessels of 
        the United States or vessels which have valid fishing 
        permits issued by the Secretary in accordance with 
        section 204(b) of the Magnuson Fishery Conservation and 
        Management Act (16 U.S.C. 1824(b)), while engaging in 
        commercial fishing operations, of marine mammals from a 
        species or stock designated as depleted because of its 
        listing as an endangered species or threatened species 
        under the Endangered Species Act of 1973 (16 U.S.C. 
        1531 et seq.) if the Secretary, after notice and 
        opportunity for public comment, determines that--
                  (I) the incidental mortality and serious 
                injury from commercial fisheries will have a 
                negligible impact on such species or stock;
                  (II) a recovery plan has been developed or is 
                being developed for such species or stock 
                pursuant to the Endangered Species Act of 1973; 
                and
                  (III) where required under section 118, a 
                monitoring program is established under 
                subsection (d) of such section, vessels engaged 
                in such fisheries are registered in accordance 
                with such section, and a take reduction plan 
                has been developed or is being developed for 
                such species or stock.
          (ii) Upon a determination by the Secretary that the 
        requirements of clause (i) have been met, the Secretary 
        shall publish in the Federal Register a list of those 
        fisheries for which such determination was made, and, 
        for vessels required to register under section 118, 
        shall issue an appropriate permit for each 
        authorization granted under such section to vessels to 
        which this paragraph applies. Vessels engaged in a 
        fishery included in the notice published by the 
        Secretary under this clause which are not required to 
        register under section 118 shall not be subject to the 
        penalties of this Act for the incidental taking of 
        marine mammals to which this paragraph applies, so long 
        as the owner or master of such vessel reports any 
        incidental mortality or injury of such marine mammals 
        to the Secretary in accordance with section 118.
          (iii) If, during the course of the commercial fishing 
        season, the Secretary determines that the level of 
        incidental mortality or serious injury from commercial 
        fisheries for which a determination was made under 
        clause (i) has resulted or is likely to result in an 
        impact that is more than negligible on the endangered 
        or threatened species or stock, the Secretary shall use 
        the emergency authority granted under section 118 to 
        protect such species or stock, and may modify any 
        permit granted under this paragraph as necessary.
          (iv) The Secretary may suspend for a time certain or 
        revoke a permit granted under this subparagraph only if 
        the Secretary determines that the conditions or 
        limitations set forth in such permit are not being 
        complied with. The Secretary may amend or modify, after 
        notice and opportunity for public comment, the list of 
        fisheries published under clause (ii) whenever the 
        Secretary determines there has been a significant 
        change in the information or conditions used to 
        determine such list.
          (v) Sections 103 and 104 shall not apply to the 
        taking of marine mammals under the authority of this 
        subparagraph.
          (vi) This subparagraph shall not govern the 
        incidental taking of California sea otters and shall 
        not be deemed to amend or repeal the Act of November 7, 
        1986 (Public Law 99-625; 100 Stat. 3500).
          (6)(A) A marine mammal product may be imported into 
        the United States if the product--
                  (i) was legally possessed and exported by any 
                citizen of the United States in conjunction 
                with travel outside the United States, provided 
                that the product is imported into the United 
                States by the same person upon the termination 
                of travel;
                  (ii) was acquired outside of the United 
                States as part of a cultural exchange by an 
                Indian, Aleut, or Eskimo residing in Alaska; or
                  (iii) is owned by a Native inhabitant of 
                Russia, Canada, or Greenland and is imported 
                for noncommercial purposes in conjunction with 
                travel within the United States or as part of a 
                cultural exchange with an Indian, Aleut, or 
                Eskimo residing in Alaska.
          (B) For the purposes of this paragraph, the term--
                  (i) ``Native inhabitant of Russia, Canada, or 
                Greenland'' means a person residing in Russia, 
                Canada, or Greenland who is related by blood, 
                is a member of the same clan or ethnological 
                grouping, or shares a common heritage with an 
                Indian Aleut or Eskimo residing in Alaska; and
                  (ii) ``cultural exchange'' means the sharing 
                or exchange of ideas, information, gifts, 
                clothing, or handicrafts between an Indian, 
                Aleut, or Eskimo residing in Alaska and a 
                native inhabitant of Russia, Canada, or 
                Greenland, including rendering of raw marine 
                mammal parts as part of such exchange into 
                clothing or handicrafts through carving, 
                painting, sewing, or decorating.
    (b) Except as provided in section 109 of this title the 
provisions of this Act shall not apply with respect to the 
taking of any marine mammal by any Indian, Aleut, or Eskimo who 
resides in Alaska and who dwells on the coast of the North 
Pacific Ocean or the Arctic Ocean if such taking--
          (1) is for subsistence purposes; or
          (2) is done for purposes of creating and selling 
        authentic native articles of handicrafts and clothing: 
        Provided, That only authentic native articles of 
        handicrafts and clothing may be sold in interstate 
        commerce: And provided further, That any edible portion 
        of marine mammals may be sold in native villages and 
        towns in Alaska or for native consumption. For the 
        purposes of this subsection, the term ``authentic 
        native articles of handicrafts and clothing'' means 
        items composed wholly or in some significant respect of 
        natural materials, and which are produced, decorated, 
        or fashioned in the exercise of traditional native 
        handicrafts without the use of pantographs, multiple 
        carvers, or other mass copying devices. Traditional 
        native handicrafts include, but are not limited to 
        weaving, carving, stitching, sewing, lacing, beading, 
        drawing, and painting; and
          (3) in each case, is not accomplished in a wasteful 
        manner.
Notwithstanding the preceding provisions of this subsection, 
when, under this Act, the Secretary determines any species or 
stock of marine mammal subject to taking by Indians, Aleuts, or 
Eskimos to be depleted, he may prescribe regulations upon the 
taking of such marine mammals by any Indian, Aleut, or Eskimo 
described in this subsection. Such regulations may be 
established with reference to species or stocks, geographical 
description of the area included, the season for taking, or any 
other factors related to the reason for establishing such 
regulations and consistent with the purposes of this Act. Such 
regulations shall be prescribed after notice and hearing 
required by section 103 of this title and shall be removed as 
soon as the Secretary determines that the need for their 
imposition has disappeared. In promulgating any regulation or 
making any assessment pursuant to a hearing or proceeding under 
this subsection or section 117(b)(2), or in making any 
determination of depletion under this subsection or finding 
regarding unmitigable adverse impacts under subsection (a)(5) 
that affects stocks or persons to which this subsection 
applies, the Secretary shall be responsible for demonstrating 
that such regulation, assessment, determination, or finding is 
supported by substantial evidence on the basis of the record as 
a whole. The preceding sentence shall only be applicable in an 
action brought by one or more Alaska Native organizations 
representing persons to which this subsection applies.
    (c) It shall not be a violation of this Act to take a 
marine mammal if such taking is imminently necessary in self-
defense or to save the life of a person in immediate danger, 
and such taking is reported to the Secretary within 48 hours. 
The Secretary may seize and dispose of any carcass.
    (d) Good Samaritan Exemption.--Is shall not be a violation 
of this Act to take a marine mammal if--
          (1) such taking is imminently necessary to avoid 
        serious injury, additional injury, or death to a marine 
        mammal entangled in fishing gear or debris;
          (2)reasonable care is taken to ensure the safe 
        release of the marine mammal, taking into consideration 
        the equipment, expertise, and conditions at hand;
          (3) reasonable care is exercised to prevent any 
        further injury to the marine mammal; and
          (4) such taking is reported to the Secretary within 
        48 hours.
    (e) Act Not to Apply to Incidental Takings by United States 
Citizens Employed on Foreign Vessels Outside the United States 
EEZ.--The provisions of this Act shall not apply to a citizen 
of the United States who incidentally takes any marine mammal 
during fishing operations outside the United States exclusive 
economic zone (as defined in section 3 of the Magnuson-Stevens 
Fishery Conservation and Management Act (16 U.S.C. 1802)) when 
employed on a foreign fishing vessel of a harvesting nation 
which is in compliance with the International Dolphin 
Conservation Program.

           *       *       *       *       *       *       *


         TITLE III--INTERNATIONAL DOLPHIN CONSERVATION PROGRAM

SEC. 301. FINDINGS AND POLICY.

    (a) Findings.--The Congress finds the following:
          (1) The yellowfin tuna fishery of the eastern 
        tropical Pacific Ocean has resulted in the deaths of 
        millions of dolphins.
          (2) Significant awareness and increased concern for 
        the health and safety of dolphin populations has 
        encouraged a change in fishing methods worldwide.
          (3) United States tuna fishing vessels have led the 
        world in the development of fishing methods to reduce 
        dolphin mortalities in the eastern tropical Pacific 
        Ocean and United States tuna processing companies have 
        voluntarily promoted the marketing of tuna that is 
        dolphin safe.
          (4) Nations harvesting yellowfin tuna in the eastern 
        tropical Pacific Ocean have demonstrated their 
        willingness to participate in appropriate multilateral 
        agreements to reduce dolphin mortality progressively to 
        a level approaching zero through the setting of annual 
        limits, with the goal of eliminating dolphin mortality 
        in that fishery. Recognition of the International 
        Dolphin Conservation Program will assure that the 
        existing trend of reduced dolphin mortality continues; 
        that individual stocks of dolphins are adequately 
        protected; and that the goal of eliminating all dolphin 
        mortality continues to be a priority.
    (b) Policy.--It is the policy of the United States to--
          (1) eliminate the marine mammal mortality resulting 
        from the intentional encirclement of dolphins and other 
        marine mammals in tuna purse seine fisheries;
          (2) support the International Dolphin Conservation 
        Program and efforts within the Program to reduce, with 
        the goal of eliminating, the mortality referred to in 
        paragraph (1);
          (3) ensure that the market of the United States does 
        not act as an incentive to the harvest of tuna caught 
        with driftnets or caught by purse seine vessels in the 
        eastern tropical Pacific Ocean not operating in 
        compliance with the International Dolphin Conservation 
        Program;
          (4) secure appropriate multilateral agreements to 
        ensure that United States tuna fishing vessels shall 
        have continued access to productive tuna fishing 
        grounds in the South Pacific Ocean and elsewhere; and
          (5) encourage observer coverage on purse seine 
        vessels fishing for tuna outside of the eastern 
        tropical Pacific Ocean in a fishery in which the 
        Secretary has determined that a regular and significant 
        association occurs between marine mammals and tuna, and 
        in which tuna is harvested through the use of purse 
        seine nets deployed on or to encircle marine mammals.

SEC. 302. INTERNATIONAL DOLPHIN CONSERVATION PROGRAM.

    The Secretary of State, in consultation with the Secretary, 
shall seek to secure a binding international agreement to 
establish an International Dolphin Conservation Program that 
requires--
    (1) that the total annual dolphin mortality in the purse 
seine fishery for yellowfin tuna in the eastern tropical 
Pacific Ocean shall not exceed 5,000 animals with a commitment 
and objective to progressively reduce dolphin mortality to a 
level approaching zero through the setting of annual limits;
    (2) the establishment of a per-sock per-year dolphin 
mortality limit, to be in effect through calendar year 2000, at 
a level between 0.2 percent and 0.1 percent of the minimum 
population estimate, as calculated, revised, or approved by the 
Secretary;
    (3) the establishment of a per-stock per-year dolphin 
mortality limit, beginning with the calendar year 2001, at a 
level less than or equal to 0.1 percent of the minimum 
population estimate as calculated, revised, or approved by the 
Secretary;
    (4) that if a dolphin mortality limit is exceeded under--
          (A) paragraph (1), all sets on dolphins shall cease 
        for the applicable fishing year; and
          (B) paragraph (2) or (3), all sets on the stocks 
        covered under paragraph (2) or (3) and any mixed 
        schools that contain any of those stocks shall cease 
        for the applicable fishing year;
    (5) a scientific review and assessment to be conducted in 
calendar year 1998 to--
          (A) assess progress in meeting the objectives set for 
        calendar year 2000 under paragraph (2); and
          (B) as apppropriate, consider recommendations for 
        meeting these objectives;
    (6) a scientific review and assessment to be conducted in 
calendar year 2000--
          (A) to review the stocks covered under paragraph (3); 
        and
          (B) as appropriate to consider recommendations to 
        further the objectives set under that paragraph;
    (7) the establishment of a per vessel maximum annual 
dolphin mortality limit consistent with the established per-
year mortality limits, as determined under paragraph (1) 
through (3); and
    (8) the provision of a system of incentives to vessel 
captains to continue to reduce dolphin mortality, with the goal 
of eliminating dolphin mortality.

SEC. 303. REGULATORY AUTHORITY OF THE SECRETARY.

    (a) Regulations.--
          (1) The Secretary shall issue regulations, and revise 
        those regulations as may be appropriate, to implement 
        the International Dolphin Conservation Program.
        (2)(A) The Secretary shall issue regulations to 
        authorize and govern the taking of marine mammals in 
        the eastern tropical Pacific Ocean, including any 
        species of marine mammal designated as depleted under 
        this Act but not listed as endangered or threatened 
        under the Endangered Species Act (16 U.S.C. 1531 et 
        seq.), by vessels of the United States participating in 
        the International Dolphin Conservation Program.
          (B) Regulations issued under this section shall 
        include provisions--
                  (i) requiring observers on each vessel;
                  (ii) requiring use of the backdown procedure 
                or other procedures equally or more effective 
                in avoiding mortality of, or serious injury to, 
                marine mammals in fishing operations;
                  (iii) prohibiting intentional sets on stocks 
                and schools in accordance with the 
                International Dolphin Conservation Program;
                  (iv) requiring the use of special equipment, 
                including dolphin safety panels in nets, 
                monitoring devices as identified by the 
                International Dolphin Conservation Program to 
                detect unsafe fishing conditions that may cause 
                high incidental dolphin mortality before nets 
                are deployed by a tuna vessel, operable rafts, 
                speedboats with towing bridles, floodlights in 
                operable condition, and diving masks and 
                snorkels;
                  (v) ensuring that the backdown procedure 
                during sets of purse seine net on marine 
                mammals is completed and rolling of the net to 
                sack up has begun no later than 30 minutes 
                before sundown;
                  (vii) establishing per vessel maximum annual 
                dolphin mortality limits, total dolphin 
                mortality limits and per-stock per-year 
                mortality limits in accordance with the 
                International Dolphin Conservation Program;
                  (viii) preventing the making of intentional 
                sets on dolphins after reaching either the 
                vessel maximum annual dolphin mortality limits, 
                total dolphin mortality limits, or per-stock 
                per-year mortality limits;
                  (ix) preventing the fishing on dolphins by a 
                vessel without an assigned vessel dolphin 
                mortality limit;
                  (x) allowing for the authorization and 
                conduct of experimental fishing operations, 
                under such terms and conditions as the 
                Secretary may prescribe, for the purpose of 
                testing proposed improvements in fishing 
                techniques and equipment that may reduce or 
                eliminate dolphin mortality or serious injury 
                do not require the encirclement of dolphins in 
                the course of commercial yellowfin tuna 
                fishing;
                  (xi) authorizing fishing within the area 
                covered by the International Dolphin 
                Conservation Program by vessels of the United 
                States without the use of special equipment or 
                nets if the vessel takes an observer and does 
                not intentionally deploy nets on, or encircle, 
                dolphins, under such terms and conditions as 
                the Secretary may prescribe; and
                  (xii) containing such other restrictions and 
                requirements as the Secretary determines are 
                necessary to implement the International 
                Dolphin Conservation Program with respect to 
                vessels of the United States.
          (C) Adjustments to requirements.--The Secretary may 
        make such adjustments as may be appropriate to 
        requirements of subparagraph (B) that pertain to 
        fishing gear, vessel equipment, and fishing practices 
        to the extent the adjustments are consistent with the 
        International Dolphin Conservation Program.
    (b) Consultation.--In developing any regulation under this 
section, the Secretary shall consult with the Secretary of 
State, the Marine Mammal Commission, and the United States 
Commissioners to the Inter-American Tropical Tuna Commission 
appointed under section 3 of the Tuna Conventions Act of 1950 
(16 U.S.C. 952).
    (c) Emergency Regulations.--
          (1) If the Secretary determines, on the basis of the 
        best scientific information available (including 
        research conducted under section 304 and information 
        obtained under the International Dolphin Conservation 
        Program) that the incidental mortality and serious 
        injury of marine mammals authorized under this title is 
        having, or is likely to have, a significant adverse 
        impact on a marine mammal stock or species, the 
        Secretary shall--
                  (A) notify the Inter-American Tropical Tuna 
                Commission of his or her determination, along 
                with recommendations to the Commission as to 
                actions necessary to reduce incidental 
                mortality and serious injury and mitigate such 
                adverse impact; and
                  (B) prescribe emergency regulations to reduce 
                incidental mortality and serious injury and 
                mitigate such adverse impact.
          (2) Before taking action under subparagraph (A) or 
        (B) of paragraph (1), the Secretary shall consult with 
        the Secretary of State, the marine Mammal Commission, 
        and the United States Commissioners to the Inter-
        American Tropical Tuna Commission.
          (3) Emergency regulations prescribed under this 
        subsection--
                  (A) shall be published in the Federal 
                Register, together with an explanation thereof;
                  (B) shall remain in effect for the duration 
                of the applicable fishing year; and
                  (C) may be terminated by the Secretary at an 
                earlier date by publication in the Federal 
                Register of a notice of termination if the 
                Secretary determines that the reasons for the 
                emergency action no longer exist.
          (4) If the Secretary finds that the incidental 
        mortality and serious injury of marine mammals in the 
        yellowfin tuna fishery in the eastern tropical Pacific 
        Ocean is continuing to have a significant adverse 
        impact on a stock or species, the Secretary may extend 
        the emergency regulations for such additional periods 
        as may be necessary.
          (5) Within 120 days after the Secretary notifies the 
        United States Commissioners to the Inter-American 
        Tropical Tuna Commission of the Secretary's 
        determination under paragraph (1)(A), the United States 
        Commissioners shall call for a special meeting of the 
        Commission to address the actions necessary to reduce 
        incidental mortality and serious injury and mitigate 
        the adverse impact which resulted in the determination. 
        The Commissioners shall report the results of the 
        special meeting in writing to the Secretary and to the 
        Secretary of State. In their report, the Commissioners 
        shall--
                  (A) include a description of the actions 
                taken by the harvesting nations or under the 
                International Dolphin Conservation Program to 
                reduce the incidental mortality and serious 
                injury and measures to mitigate the adverse 
                impact on the marine mammal species or stock;
                  (B) indicate whether, in their judgment, the 
                actions taken address the problem adequately; 
                and
                  (C) if they indicate that the actions taken 
                do not address the problem adequately, include 
                recommendations of such additional action to be 
                taken as may be necessary.

           *       *       *       *       *       *       *


SEC. 306. PERMITS.

    (a) In General.--
          (1) Consistent with the regulations issued pursuant 
        to section 303, the Secretary shall issue a permit to a 
        vessel of the United States authorizing participation 
        in the International Dolphin Conservation Program and 
        may require a permit for the person actually in charge 
        of and controlling the fishing operation of the vessel. 
        The Secretary shall prescribe such procedures as are 
        necessary to carry out this subsection, including 
        requiring the submission of--
                  (A) the name and official number or other 
                identification of each fishing vessel for which 
                a permit is sought, together with the name and 
                address of the owner thereof; and
                  (B) the tonnage, hold capacity, speed, 
                processing equipment, and type and quantity of 
                gear, including an inventory of special 
                equipment required under section 303, with 
                respect to each to each vessel.
          (2) The Secretary is authorized to charge a fee for 
        granting an authorization and issuing a permit under 
        this section. The level of fees charged under this 
        paragraph may not exceed the administrative cost 
        incurred in granting an authorization and issuing a 
        permit. Fees collected under this paragraph shall be 
        available to the Under Secretary of Commerce for Oceans 
        and Atmosphere for expenses incurred in granting 
        authorizations and issuing permits under this section.
          (3) After the effective date of the International 
        Dolphin Conservation Program Act, no vessel of the 
        United States shall operate in the yellowfin tuna 
        fishery in the eastern tropical Pacific Ocean without a 
        valid permit issued under this section.
      (b) Permit Sanctions.--
                  (A) a vessel for which a permit has been 
                issued under this section has been used in the 
                commission of an act prohibited under section 
                307;
                  (B) the owner or operator of any such vessel 
                or any other person who has applied for or been 
                issued a permit under this section has acted in 
                violation of section 307; or
                  (C) any civil penalty or criminal fine 
                imposed on a vessel, owner or operator of a 
                vessel, or other person who has applied for or 
                been issued a permit under this section has not 
                been paid or is overdue, the Secretary may--
                          (i) revoke any permit with respect to 
                        such vessel, with or without prejudice 
                        to the issuance of subsequent permits;
                          (ii) suspend such permit for a period 
                        of time considered by the Secretary to 
                        be appropriate;
                          (iii) deny such permit; or
                          (iv) impose additional conditions or 
                        restrictions on any permit issued to, 
                        or applied for by any such vessel or 
                        person under this section.
          (2) In imposing a sanction under this subsection, the 
        Secretary shall take into account--
                  (A) the nature, circumstances, extent, and 
                gravity of the prohibited acts for which the 
                sanction is imposed; and
                  (B) with respect to the violator, the degree 
                of culpability, and history of prior offenses, 
                an other such matters as justice requires.
          (3) Transfer of ownership of a vessel, by sale or 
        otherwise, shall not extinguish any permit sanction 
        that is in effect or is pending at the time of transfer 
        of ownership. Before executing the transfer of 
        ownership of a vessel, by sale or otherwise, the owner 
        shall disclose in writing to the prospective transferee 
        the existence of any permit sanction that will be in 
        effect or pending with respect to the vessel at the 
        time of transfer.
          (4) In the case of any permit that is suspended for 
        the failure to pay a civil penalty or criminal fine, 
        the Secretary shall reinstate the permit upon payment 
        of the penalty or fine and interest thereon at the 
        prevailing rate.
          (5) No sanctions shall be imposed under this section 
        unless there has been a prior opportunity for a hearing 
        on the facts underlying the violation for which the 
        sanction is imposed, either in conjunction with a civil 
        penalty proceeding under this title or otherwise.

SEC. 307. PROHIBITIONS.

    (a) In General.--It is unlawful--
          (1) for any person to sell, purchase, offer for sale 
        transport, or ship, in the United States, any tuna or 
        tuna product unless the tuna or tuna product is either 
        dolphin safe or has been harvested in compliance with 
        the International Dolphin Conservation Program by a 
        country that is a member of the Inter-American Tropical 
        Tuna Commission or has initiated and within 6 months 
        thereafter completed all steps required of applicant 
        nations in accordance with Article V, paragraph 3 of 
        the Convention establishing the Inter-American Tropical 
        Tuna Commission, to become a member of that 
        organization;
          (2) except as provided for in subsection 101(d), for 
        any person or vessel subject to the jurisdiction of the 
        United States intentionally to set a purse seine net on 
        or to encircle any marine mammal in the course of tuna 
        fishing operations in the eastern tropical Pacific 
        Ocean except in accordance with this title and 
        regulations issued pursuant to this title; and
          (3) for any person to import any yellowfin tuna or 
        yellowfin tuna product or any other fish or fish 
        product in violation of a ban on importation imposed 
        under section 101(a)(2);
          (4) for any person to violate any regulation 
        promulgated under this title;
          (5) for any person to refuse to permit any duly 
        authorized officer to board a vessel subject to that 
        person's control for purposes of conducting any search 
        or inspection in connection with the enforcement of 
        this title; and
          (6) for any person to assault, resist, oppose, 
        impede, intimidate, or interfere with any such 
        authorized officer in the conduct of any search or 
        inspection described in paragraph (5).
    (b) Penalties.--
          (1) Civil penalty.--A person that knowingly and 
        willfully violates subsection (a) (1), (2), (3), (4), 
        or (5) shall be subject to a civil penalty under 
        section 105(a).
          (2) Criminal penalty.--A person that knowingly and 
        willfully violates subsection (a)(5) or (a)(6) shall be 
        subject to a criminal penalty under section 105(b).
    (c) Civil Forfeitures.--Any vessel (including its fishing 
gear, appurtenances, stores, and cargo) used, and any fish (or 
its fair market value) taken or retained, in any manner, in 
connection with or as a result of the commission of any act 
prohibited by this section shall be subject to forfeiture to 
the United States in the manner provided in section 310 of the 
Magnuson Fishery Conservation and Management Act.

      Section 9 of the Endangered Species Act of 1973, as amended

 [16 U.S.C. 1538; P.L. 93-205, as amended by P.L. 94-359, P.L. 95-212, 
 P.L. 95-632, P.L. 96-159, P.L. 96-246, P.L. 97-304, P.L. 99-659, P.L. 
         100-478, P.L. 100-653, P.L. 100-707, and P.L. 102-582]

                            PROHIBITED ACTS

    Sec. 9. (a) General.--(1) Except as provided in sections 
6(g)(2) and 10 of this Act, with respect to any endangered 
species of fish or wildlife listed pursuant to section 4 of 
this Act it is unlawful for any person subject to the 
jurisdiction of the United States to--
          (A) import any such species into, or export any such 
        species from the United States;
          (B) take any such species within the United States or 
        the territorial sea of the United States;
          (C) take any such species upon the high seas;
          (D) possess, sell, deliver, carry, transport, or 
        ship, by any means whatsoever, any such species taken 
        in violation of subparagraphs (B) and (C);
          (E) deliver, receive, carry, transport, or ship in 
        interstate or foreign commerce, by any means whatsoever 
        and in the course of a commercial activity, any such 
        species;
          (F) sell or offer for sale in interstate or foreign 
        commerce any such species; or
          (G) violate any regulation pertaining to such species 
        or to any threatened species of fish or wildlife listed 
        pursuant to section 4 of this Act and promulgated by 
        the Secretary pursuant to authority provided by this 
        Act.
    (2) Except as provided in sections 6(g)(2) and 10 of this 
Act, with respect to any endangered species of plants listed 
pursuant to section 4 of this Act, it is unlawful for any 
person subject to the jurisdiction of the United States to--
          (A) import any such species into, or export any such 
        species from, the United States;
          (B) remove and reduce to possession any such species 
        from areas under Federal jurisdiction; maliciously 
        damage or destroy any such species on any such area; or 
        remove, cut, dig up, or damage or destroy any such 
        species on any other area in knowing violation of any 
        law or regulation of any State or in the course of any 
        violation of a State criminal trespass law;
          (C) deliver, receive, carry, transport, or ship in 
        interstate or foreign commerce, by any means whatsover 
        and in the course of a commercial activity, any such 
        species;
          (D) sell or offer for sale in interstate or foreign 
        commerce any such species; or
          (E) violate any regulation pertaining to such species 
        or to any threatened species of plants listed pursuant 
        to section 4 of this Act and promulgated by the 
        Secretary pursuant to authority provided by this Act.
    (b) Species Held in Captivity or Controlled Environment.--
(1) The provisions of subsections (a)(1)(A) and (a)(1)(G) of 
this section shall not apply to any fish or wildlife which was 
held in captivity or in a controlled environment on (A) the 
effective date of this Act or (B) the date of the publication 
in the Federal Register of a final regulation adding such fish 
or wildlife species to any list published pursuant to 
subsection (c) of section 4 of this Act: Provided, That such 
holding and any subsequent holding or use of the fish or 
wildlife was not in the course of a commercial activity. With 
respect to any act prohibited by subsections (a)(1)(A) and 
(a)(1)(G) of this section which occurs after a period of 180 
days from (i) the effective date of this Act, or (ii) the date 
of publication in the Federal Register of a final regulation 
adding such fish or wildlife species to any list published 
pursuant to subsection (c) of section 4 of this Act, there 
shall be a rebuttable presumption that the fish or wildlife 
involved in such act is not entitled to the exemption contained 
in this subsection.
    (2)(A) The provisions of subsection (a)(1) of this section 
shall not apply to--
          (i) any raptor legally held in captivity or in a 
        controlled environment on November 10, 1978; or
          (ii) any progeny of any raptor described in clause 
        (i);
until such time as any such raptor or progeny is intentionally 
returned to a wild state.
    (B) Any person holding any raptor or progeny described in 
subparagraph (A) must be able to demonstrate that the raptor or 
progeny does, in fact, qualify under the provisions of this 
paragraph, and shall maintain and submit to the Secretary, on 
request, such inventories, documentation, and records as the 
Secretary may by regulation require as being reasonably 
appropriate to carry out the purposes of this paragraph. Such 
requirements shall not unnecessarily duplicate the requirements 
of other rules and regulations promulgated by the Secretary.
    (c) Violation of Convention.--(1) It is unlawful for any 
person subject to the jurisdiction of the United States to 
engage in any trade in any specimens contrary to the provisions 
of the Convention, or to possess any specimens traded contrary 
to the provisions of the Convention, including the definitions 
of terms in article I thereof.
    (2) Any importation into the United States of fish or 
wildlife shall, if--
          (A) such fish or wildlife is not an endangered 
        species listed pursuant to section 4 of this Act but is 
        listed in Appendix II to the Convention,
          (B) the taking and exportation of such fish or 
        wildlife is not contrary to the provisions of the 
        Convention and all other applicable requirements of the 
        Convention have been satisfied,
          (C) the applicable requirements of subsections (d), 
        (e), and (f) of this section have been satisfied, and
          (D) such importation is not made in the course of a 
        commercial activity,
be presumed to be an importation not in violation of any 
provisions of this Act or any regulation issued pursuant to 
this Act.
    (d) Imports and Exports.--(1) It is unlawful for any 
person, without first having obtained permission from the 
Secretary, to engage in business--
          (A) as an importer or exporter of fish or wildlife 
        (other than shellfish and fishery products which (i) 
        are not listed pursuant to section 4 of this Act as 
        endangered species or threatened species, and (ii) are 
        imported for purposes of human or animal consumption or 
        taken in waters under the jurisdiction of the United 
        States or on the high seas for recreational purposes) 
        or plants; or
          (B) as an importer or exporter of any amount of raw 
        or worked African elephant ivory.
    (2) Any person required to obtain permission under 
paragraph (1) of this subsection shall--
          (A) keep such records as willfully and correctly 
        disclose each importation or exportation of fish, 
        wildlife, plants, or African elephant ivory made by him 
        and the subsequent disposition made by him with respect 
        to such fish, wildlife, plants, or ivory;
          (B) at all reasonable times upon notice by a duly 
        authorized representative of the Secretary, afford such 
        representative access to his place of business, an 
        opportunity to examine his inventory of imported fish, 
        wildlife, plants, or African elephant ivory and the 
        records required to be kept under subparagraph (A) of 
        this paragraph, and to copy such records; and
          (C) file such reports as the Secretary may require.
    (3) The Secretary shall prescribe such regulations as are 
necessary and appropriate to carry out the purposes of this 
subsection.
    (4) In granting permission under this subsection for 
importation or exportation of African elephant ivory, the 
Secretary shall not vary the requirements for obtaining such 
permission on the basis of the value or amount of ivory 
imported or exported under such permission.
    (e) Reports.--It is unlawful for any person importing or 
exporting fish or wildlife (other than shellfish and fishery 
products which (1) are not listed pursuant to section 4 of this 
Act as endangered or threatened species, and (2) are imported 
for purposes of human or animal consumption or taken in waters 
under the jurisdiction of the United States or on the high seas 
for recreational purposes) or plants to fail to file any 
declaration or report as the Secretary deems necessary to 
facilitate enforcement of this Act or to meet the obligations 
of the Convention.
    (f) Designation of Ports.--(1) It is unlawful for any 
person subject to the jurisdiction of the United States to 
import into or export from the United States any fish or 
wildlife (other than shellfish and fishery products which (A) 
are not listed pursuant to section 4 of this Act as endangered 
species or threatened species, and (B) are imported for 
purposes of human or animal consumption or taken in waters 
under the jurisdiction of the United States or on the high seas 
for recreational purposes) or plants, except at a port or ports 
designated by the Secretary of the Interior. For the purpose of 
facilitating enforcement of this Act and reducing the costs 
thereof, the Secretary of the Interior, with approval of the 
Secretary of the Treasury and after notice and opportunity for 
public hearing, may, by regulation, designate ports and change 
such designations. The Secretary of the Interior, under such 
terms and conditions as he may prescribe, may permit the 
importation or exportation at nondesignated ports in the 
interest of the health or safety of the fish or wildlife or 
plants, or for other reasons if, in his discretion, he deems it 
appropriate and consistent with the purpose of this subsection.
    (2) Any port designated by the Secretary of the Interior 
under the authority of section 4(d) of the Act of December 5, 
1969 (16 U.S.C. 666cc-4(d)), shall, if such designation is in 
effect on the day before the date of the enactment of this Act, 
be deemed to be a port designated by the Secretary under 
paragraph (1) of this subsection until such time as the 
Secretary otherwise provides.
    (g) Violations.--It is unlawful for any person subject to 
the jurisdiction of the United States to attempt to commit, 
solicit another to commit, or cause to be committed, any 
offense defined in this section.

           Section 527 of the Tariff Act of 1930, as amended

                     [19 U.S.C. 1527; P.L. 71-361]

SEC. 527. IMPORTATION OF WILD MAMMALS AND BIRDS IN VIOLATION OF FOREIGN 
                    LAW.

    (a) Importation Prohibited.--If the laws or regulations of 
any country, dependency, province, or other subdivision of 
government restrict the taking, killing, possession, or 
exportation to the United States, of any wild mammal or bird, 
alive or dead, or restrict the exportation to the United States 
or any part or product of any wild mammal or bird, whether raw 
or manufactured, no such mammal or bird, whether raw or 
manufactured, no such mammal or bird, or part or product 
thereof, shall, after the expiration of ninety days after the 
enactment of this Act, be imported into the United States from 
such country, dependency, province, or other subdivision of 
government, directly or indirectly, unless accompanied by a 
certification of the United States consul, for the consular 
district in which is located the port or place from which such 
mammal or bird, or part or product thereof, was exported from 
such country, dependency, province, or other subdivision of 
government, that such mammal or bird, or part of product 
thereof, has not been acquired or exported in violation of the 
laws or regulations of such country, dependency, province, or 
other subdivision of government.
    (b) Forfeiture.--Any mammal or bird, alive or dead, or any 
part or product thereof, whether raw or manufactured, imported 
into the United States in violation of the provisions of the 
preceding subdivision shall be subject to seizure and 
forfeiture under the customs laws. Any such article so 
forfeited may, in the discretion of the Secretary of the 
Treasury and under such regulations as he may prescribe, be 
placed with the departments or bureaus of the Federal or State 
Governments, or with societies or museums, for exhibition or 
scientific or educational purposes, or destroyed, or (exempt in 
the case of heads or horns of wild mammals) sold in the manner 
provided by law.
    (e) Section Not to Apply in Certain Cases.--The provisions 
of this section shall not apply in the cases of--
          (A) Prohibited importation.--Articles the importation 
        of which is prohibited under the provisions of this 
        Act, or of section 241 of the Criminal Code, or of any 
        other law;
          (2) Scientific or educational pruposes.--Wild mammals 
        or birds, alive or dead, or parts or products thereof, 
        whether raw or manufactured, imported for scientific or 
        educational purposes;
          (3) Certain migratory game birds.--Migratory game 
        birds (for which an open season is provided by the laws 
        of the United States and any foreign country which is a 
        part to a treaty with the United States, in effect on 
        the date of importation, relating to the protection of 
        such migratory game birds) brought into the United 
        States by bona fide sportsmen returning from hunting 
        trips in such country, if at the time of importation 
        the possession of such birds is not prohibited by the 
        laws of such country or of the United States.

   Section 2201-2204 of the Endangered Species Act Amendment of 1988

                   African Elephant Conservation Act

                               [Excerpts]

                  [16 U.S.C. 4221-4224; P.L. 100-478]

                 PART 2--MORATORIA AND PROHIBITED ACTS

    Sec. 2201. Review of African Elephant Conservation 
Programs.
    (a) In General.--Within one month after the date of the 
enactment of this title, the Secretary shall issue a call for 
information on the African elephant conservation program of 
each ivory producing country by--
          (1) publishing a notice in the Federal Register 
        requesting submission of such information to the 
        Secretary by all interested parties; and
          (2) submitting a written request for such information 
        through the Secretary of State to each ivory producing 
        country.
    (b) Review and Determination.--
          (1) In general.--The Secretary shall review the 
        African elephant conservation program of each ivory 
        producing country and, not later than one year after 
        the date of the enactment of this title, shall issue 
        and publish in the Federal Register a determination of 
        whether or not the country meets the following 
        criteria;
                  (A) The country is a party to CITES and 
                adheres to the CITES Ivory Control System.
                  (B) The country's elephant conservation 
                program is based on the best available 
                information, and the country is making 
                expeditious progress in compiling information 
                on the elephant habitat condition and carrying 
                capacity, total population and population and 
                population trends, and the annual reproduction 
                and mortality of the elephant populations 
                within the country.
                  (C) The taking of elephants in the country is 
                effectively controlled and monitored.
                  (D) The country's ivory quota is determined 
                on the basis of information referred to in 
                subparagraph (B) and reflects the amount of 
                ivory which is confiscated or consumed 
                domestically by the country.
                  (E) The country has not authorized or allowed 
                the export of amounts of raw ivory which exceed 
                its ivory quota under the CITES Ivory Control 
                System.
          (2) Delay in issuing determination.--If the Secretary 
        finds within one year after the date of the enactment 
        of this title that there is insufficient information 
        upon which to make the determination under paragraph 
        (1), the Secretary may delay issuing the determination 
        until no later than December 31, 1989. The Secretary 
        shall issue and publish in the Federal Register at the 
        time of the finding a statement explaining the reasons 
        for any such delay.
    Sec. 2202. Moratoria.
    (a) Ivory Producing Countries.--
          (1) In general.--The Secretary shall establish a 
        moratorium on the importation of raw and worked ivory 
        from an ivory producing country immediately upon making 
        a determination that the country does not meet all the 
        criteria set forth in section 2201(b)(1).
          (2) Later establishment.--With regard to any ivory 
        producing country for which the Secretary has 
        insufficient information to make a determination 
        pursuant to section 2201(b), the Secretary shall 
        establish a moratorium the importation of raw and 
        worked ivory from such country not later than January 
        1, 1990, unless, based on new information, the 
        Secretary concludes before that date that the country 
        meets all of the criteria set forth in section 
        2201(b)(1).
    (b) Intermediary Countries.--The Secretary shall establish 
a moratorium on the importation of raw and worked ivory from an 
intermediary country immediately upon making a determination 
that the country--
          (1) is not a party to CITES;
          (2) does not adhere to the CITES Ivory Control 
        System;
          (3) imports raw ivory from a country that is not an 
        ivory producing country;
          (4) imports raw or worked ivory from a country that 
        is not a party to CITES;
          (5) imports raw or worked ivory that originates in an 
        ivory producing country in violation of the laws of 
        that ivory producing country;
          (6) substantially increases its imports of raw or 
        worked ivory from a country that is subject to a 
        moratorium under this title during the first three 
        months of that moratorium; or
          (7) imports raw or worked ivory from a country that 
        is subject to a moratorium under this title after the 
        first three months of that moratorium, unless the ivory 
        is imported by vessel during the first six months of 
        that moratorium and is accompanied by shipping 
        documents which show that it was exported before the 
        establishment of the moratorium.
    (c) Suspension of Moratorium.--The Secretary shall suspend 
a moratorium established under this section if, after notice 
and public comment, the Secretary determines that the reasons 
for establishing the moratorium no longer exist.
    (d) Petition.--
          (1) In general.--Any person may at any time submit a 
        petition in writing requesting that the Secretary 
        establish or suspend a moratorium under this section. 
        Such a petition shall include such substantial 
        information as may be necessary to demonstrate the need 
        for the action requested by the petition.
          (2) Consideration and ruling.--The Secretary shall 
        publish a notice of receipt of a petition under this 
        subsection in the Federal Register and shall provide an 
        opportunity for the public to comment on the petition. 
        The Secretary shall rule on such petition not later 
        than 90 days after the close of the public comment 
        period.
    (e) Sport-Hunted Trophies.--Individuals may import sport-
hunted elephant trophies that they have legally taken in an 
ivory producing country that has submitted an ivory quota. The 
Secretary shall not establish any moratorium under this 
section, pursuant to a petition or otherwise, which prohibits 
the importation into the United States of sport-hunted trophies 
from elephants that are legally taken by the importer or the 
importer's principal in an ivory producing country that has 
submitted an ivory quota.
    (f) Confiscated Ivory.--Trade in raw or worked ivory that 
is confiscated by an ivory producing country or an intermediary 
country and is disposed of pursuant to the CITES Ivory Control 
System shall not be the sole cause for the establishment of a 
moratorium under this part if all proceeds from the disposal of 
the confiscated ivory are used solely to enhance wildlife 
conservation programs or conservation purposes of CITES. With 
respect to any country that was not a party to CITES at the 
time of such confiscation, this subsection shall not apply 
until such country develops appropriate measures to assure that 
persons with a history of illegal dealings in ivory shall not 
benefit from the disposal of confiscated ivory.
    Sec. 2203. Prohibited Acts.
    Except as provided in section 2202(e), it is unlawful for 
any person--
          (1) to import raw ivory from any country other than 
        an ivory producing country;
          (2) to export raw ivory from the United States;
          (3) to import raw or worked ivory that was exported 
        from an ivory producing country in violation of that 
        country's laws or of the CITES Ivory Control System;
          (4) to import worked ivory, other than personal 
        effects, from any country unless that country has 
        certified that such ivory was derived from legal 
        sources; or
          (5) to import raw or worked ivory from a country for 
        which a moratorium is in effect under section 2202.
    Sec. 2204. Penalties and Enforcement.
    (a) Criminal Violations.--Whoever knowingly violates 
section 2203 shall, upon conviction, be fined under title 18, 
United States Code, or imprisoned for not more than one year, 
or both.
    (b) Civil Violations.--Whoever violates section 2203 may be 
assessed a civil penalty by the Secretary of not more than 
$5,000 for each such violation.
    (c) Procedures for Assessment of Civil Penalty.--
Proceedings for the assessment of a civil penalty under this 
section shall be conducted in accordance with the procedures 
provided for in section 11(a) of the Endangered Species Act of 
1973 (16 U.S.C. 1540(a)).
          (D) Use of Penalties.--Subject to appropriations, 
        penalties collected under this section may be used by 
        the Secretary of the Treasury to pay rewards under 
        section 2205 and, to the extent not used to pay such 
        rewards, shall be deposited by the Secretary of the 
        Treasury into the Fund.
          (e) Enforcement.--The Secretary, the Secretary of the 
        Treasury, and the Secretary of the department in which 
        the Coast Guard is operating shall enforce this part in 
        the same manner such Secretaries carry out enforcement 
        activities under section 11(e) of the Endangered 
        Species Act of 1973 (16 U.S.C. 1540(e)). Section 11(c) 
        of the Endangered Species Act of 1973 (16 U.S.C. 
        1540(c)) shall apply to actions arising under this 
        part.

  Section 7 of the Rhinoceros and Tiger Conservation Act of 1994, as 
                                amended

      [16 U.S.C. 5305a; P.L. 103-391, as amended by P.L. 105-312]

    sec. 7--prohibition on sale, importation or exportation of 
products labeled or advertised as rhinoceros or tiger products.
    (a) Prohibition.--A person shall not sell, import, or 
export, or attempt to sell, import, or export, any product, 
item or substance intended for human consumption or application 
containing, or labeled or advertised as containing, any 
substance derived from any species of rhinoceros or tiger.
    (b) Penalties.--
          (1) Criminal Penalty.--A person engaged in business 
        as an importer, exporter, or distributor that knowingly 
        violates subsection (a) shall be fined under title 18, 
        United States Code, imprisoned not more than 6 months, 
        or both.
          (2) Civil Penalties.--
                  (A) In General.--A person that knowingly 
                violates subsection (a), and a person engaged 
                in business as an importer, exporter, or 
                distributor that violates subsection (a), may 
                be assessed a civil penalty by the Secretary of 
                not more than $12,000 for each violation.
                  (B) Manner of Assessment and Collection.--A 
                civil penalty under this paragraph shall be 
                assessed, and may be collected, in the manner 
                in which a civil penalty under the Endangered 
                Species Act of 1973 may be assessed and 
                collected under section 11(a) of that Act (16 
                U.S.C. 1540(a)).
    (c) Products, Items, and Substances.--Any product, item, or 
substance sold, imported, or exported, or attempted to be sold, 
imported, or exported, in violation of this section or any 
regulation issued under this section shall be subject to 
seizure and forfeiture to the United States.
    (d) Regulations.--After consultation with the Secretary of 
the Treasury, the Secretary of Health and Human Services, and 
the United States Trade Representative, the Secretary shall 
issue such regulations as are appropriate to carry out this 
section.
    (e) Enforcement.--The Secretary, the Secretary of the 
Treasury, and the Secretary of the department in which the 
Coast Guard is operating shall enforce this section in the 
manner in which the Secretaries carry out enforcement 
activities under section 11(e) of the Endangered Species Act of 
1973 (16 U.S.C. 1540(e)).
    (f) Use of Penalty Amounts.--Amounts received as penalties, 
fines, or forfeiture of property under this section shall be 
used in accordance with section 6(d) of the Lacey Act 
Amendments of 1981 (16 U.S.C. 3375(d)).

    Section 8 of the Fishermen's Protective Act of 1967, as amended

 [22 U.S.C. 1978; P.L. 90-578, as added by P.L. 92-219 and amended by 
 P.L. 95-376, P.L. 96-61, P.L. 96-88, P.L. 100-711, P.L. 102-582, and 
                              P.L. 106-36]

    Sec. 8. (a)(1) When the Secretary of Commerce determines 
that nationals of a foreign country, directly or indirectly, 
are conducting fishing operations in a manner or under 
circumstances which diminish the effectiveness of an 
international fishery conservation program, the Secretary of 
Commerce shall certify such fact to the President.
    (2) When the Secretary of Commerce or the Secretary of the 
Interior finds that nationals of a foreign country, directly or 
indirectly, are engaging in trade or taking which diminishes 
the effectiveness of any international program for endangered 
or threatened species, the Secretary making such finding shall 
certify such fact to the President.
    (3) In administering this subsection, the Secretary of 
Commerce or the Secretary of the Interior, as appropriate, 
shall--
          (A) periodically monitor the activities of foreign 
        nationals that may affect the international programs 
        referred to in paragraphs (1) and (2);
          (B) promptly investigate any activity by foreign 
        nationals that, in the opinion of the Secretary, may be 
        cause for certification under paragraph (1) or (2); and
          (C) promptly conclude; and reach a decision with 
        respect to; any investigation commenced under 
        subparagraph (B).
    (4) Upon receipt of any certification made under paragraph 
(1) or (2), the President may direct the Secretary of the 
Treasury to prohibit the bringing or the importation into the 
United States of any products from the offending country for 
any duration as the President determines appropriate and to the 
extent that such prohibition is sanctioned by the World Trade 
Organization (as defined in section 2(8) of the Uruguay Round 
Agreements Act) or the multilateral trade agreements (as 
defined in section 2(4) of that Act).
    (b) Within sixty days following certification by the 
Secretary of Commerce or the Secretary of the Interior, the 
President shall notify the Congress of any action taken by him 
pursuant to such certification. In the event the President 
fails to direct the Secretary of the Treasury to prohibit the 
importation of fish products or wildlife products of the 
offending country, or if such prohibition does not cover all 
fish products or wildlife products of the offending country, 
the President shall inform the Congress of the reasons 
therefor.
    (c) It shall be unlawful for any person subject to the 
jurisdiction of the United States knowingly to bring or import 
into, or cause to be imported into, the United States any 
products prohibited by the Secretary of the Treasury pursuant 
to this section.
    (d) After making a certification to the President under 
subsection (a) of this section, the Secretary of Commerce or 
the Secretary of the Interior, as the case may be, shall 
periodically review the activities of the nationals of the 
offending country to determine if the reasons for which the 
certification was made no longer prevail. Upon determining that 
such reasons no longer prevail, the Secretary concerned shall 
terminate the certification and publish notice thereof, 
together with a statement of the facts on which such 
determination is based, in the Federal Register.
    (e)(1) Any person violating the provisions of this section 
shall be fined not more than $10,000 for the first violation, 
and not more than $25,000 for each subsequent violation.
    (2) All products brought or imported into the United States 
in violation of this section, or the monetary value thereof, 
may be forfeited.
    (3) All provisions of law relating to the seizure, judicial 
forfeiture, and condemnation of a cargo for violation of the 
customs laws, the disposition of such cargo or the proceeds 
from the sale thereof, and the remission or mitigation of such 
forfeitures shall apply to seizures and forfeitures incurred, 
or alleged to have incurred, under the provisions of this 
section, insofar as such provisions of law are applicable and 
not inconsistent with this section.
    (f)(1) Enforcement of the provisions of this section 
prohibiting the bringing or importation of products into the 
United States shall be the responsibility of the Secretary of 
the Treasury.
    (2) The judges of the United States district courts, and 
United States magistrates may, within their respective 
jurisdictions, upon proper oath or affirmation showing probable 
cause, issue such warrants or other process as may be required 
for enforcement of this Act and regulations issued thereunder.
    (3) Any person authorized to carry out enforcement 
activities hereunder shall have the power to execute any 
warrant or process issued by any officer or court of competent 
jurisdiction for the enforcement of this section.
    (4) Such person so authorized shall have the power--
          (A) with or without a warrant or other process, to 
        arrest any persons subject to the jurisdiction of the 
        United States committing in his presence or view a 
        violation of this section or the regulations issued 
        thereunder;
          (B) with or without a warrant or other process, to 
        search any vessel or other conveyance subject to the 
        jurisdiction of the United States, and, if as a result 
        of such search he has reasonable cause to believe that 
        such vessel or other conveyance or any person on board 
        is engaging in operations in violation of this section 
        or the regulations issued thereunder, then to arrest 
        such person.
    (5) Such person so authorized, may seize, whenever and 
wherever lawfully found, all products brought or imported into 
the United States in violation of this section or the 
regulations issued thereunder. Products so seized may be 
disposed of pursuant to the order of a court of competent 
jurisdiction, or, if perishable, in a manner prescribed by 
regulations promulgated by the Secretary of the Treasury after 
consultation with the Secretary of Health and Human Services.
    (g) The Secretary of the Treasury, the Secretary of 
Commerce, and the Secretary of the Interior are each authorized 
to prescribe such regulations as he determines necessary to 
carry out the provisions of this section.
    (h) As used in this section--
          (1) The term ``person'' means any individual, 
        partnership, corporation, or association.
          (2) The term ``United States'' means the several 
        States, the District of Columbia, Puerto Rico, the 
        Northern Mariana Islands, American Samoa, Guam, the 
        Virgin Islands, and every other territory and 
        possession of the United States.
          (3) The term ``international fishery conservation 
        program'' means any ban, restriction, regulation, or 
        other measure in effect pursuant to a bilateral or 
        multilateral agreement which is in force with respect 
        to the United States, the purpose of which is to 
        conserve or protect the living resources of the sea, 
        including marine mammals.
          (4) The term ``international program for endangered 
        or threatened species'' means any ban, restriction, 
        regulation, or other measure in effect pursuant to a 
        multilateral agreement which is in force with respect 
        to the United States, the purpose of which is to 
        protect endangered or threatened species of animals.
          (5) The term ``taking'', as used with respect to 
        animals to which an international program for 
        endangered or threatened species applies, means to--
                  (A) harass, harm, pursue, hunt, shoot, wound, 
                kill, trap, capture, or collect; or
                  (B) attempt to harass, harm, pursue, hunt, 
                shoot, wound, kill, trap, capture, or collect.

              High Seas Driftnet Fisheries Enforcement Act

                               [Excerpts]

    [16 U.S.C. 1826a-1826c, 1826a note, and 1861 note; P.L. 102-582]

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``High Seas Driftnet Fisheries 
Enforcement Act''.

SEC. 2. FINDINGS AND POLICY.

    (a) Findings.--Congress makes the following findings:
          (1) Large-scale driftnet fishing on the high seas is 
        highly destructive to the living marine resources and 
        ocean ecosystems of the world's oceans, including 
        anadromous fish and other living marine resources of 
        the United States.
          (2) The cumulative effects of large-scale driftnet 
        fishing pose a significant threat to the marine 
        ecosystem, and slow-reproducing species like marine 
        mammals, sharks, and seabirds may require many years to 
        recover.
          (3) Members of the international community have 
        reviewed the best available scientific data on the 
        impacts of large-scale pelagic driftnet fishing, and 
        have failed to conclude that this practice has no 
        significant adverse impacts which threaten the 
        conservation and sustainable management of living 
        marine resources.
          (4) The United Nations, via General Assembly 
        Resolutions numbered 44-225, 45-197, and most recently 
        46-215 (adopted on December 20, 1991), has called for a 
        worldwide moratorium on all high seas driftnet fishing 
        by December 31, 1992, in all the world's oceans, 
        including enclosed seas and semi-enclosed seas.
          (5) The United Nations has commended the unilateral, 
        regional, and international efforts undertaken by 
        members of the international community and 
        international organizations to implement and support 
        the objectives of the General Assembly resolutions.
          (6) Operative paragraph (4) of United Nations General 
        Assembly Resolution numbered 46-215 specifically 
        ``encourages all members of the international community 
        to take measures individually and collectively to 
        prevent large-scale pelagic driftnet fishing operations 
        on the high seas of the world's oceans and seas''.
          (7) The United States, in section 307(1)(M) of the 
        Magnuson Fishery Conservation and Management Act (16 
        U.S.C. 1857(1)(M)), has specifically prohibited the 
        practice of large-scale driftnet fishing by United 
        States nationals and vessels both within the exclusive 
        economic zone of the United States and beyond the 
        exclusive economic zone of any nation.
          (8) The Senate, through Senate Resolution 396 of the 
        100th Congress, approved on March 18, 1988), has called 
        for a moratorium on fishing in the Central Bering Sea, 
        and the United States has taken concrete steps to 
        implement such moratorium through international 
        negotiations.
          (9) Despite the continued evidence of a decline in 
        the fishery resources of the Bering Sea and the 
        multiyear cooperative negotiations undertaken by the 
        United States, the Russian Federation, Japan, and other 
        concerned fishing nations, some nations refuse to agree 
        to measures to reduce or eliminate unregulated fishing 
        practices in the waters of the Bering Sea beyond the 
        exclusive economic zones of the United States and the 
        Russian Federation.
          (10) In order to ensure that the global moratorium on 
        large-scale driftnet fishing called for in United 
        Nations General Assembly Resolution numbered 46-215 
        takes effect by December 31, 1992, and that unregulated 
        fishing practices in the waters of the Central Bering 
        Sea are reduced or eliminated, the United States should 
        take the actions described in this Act and encourage 
        other nations to take similar action.
    (b) Policy.--It is the stated policy of the United States 
to--
          (1) implement United Nations General Assembly 
        Resolution numbered 46-215, approved unanimously on 
        December 20, 1991, which calls for an immediate 
        cessation to further expansion of large-scale driftnet 
        fishing, a 50 percent reduction in existing large-scale 
        driftnet fishing effort by June 30, 1992, and a global 
        moratorium on the use of large-scale driftnets beyond 
        the exclusive economic zone of any nation by December 
        31, 1992;
          (2) bring about a moratorium on fishing in the 
        Central Bering Sea, or an international conservation 
        and management agreement to which the United States and 
        the Russian Federation are parties that regulates 
        fishing in the Central Bering Sea; and
          (3) secure a permanent ban on the use of destructive 
        fishing practices, and in particular large-scale 
        driftnets, by persons or vessels fishing beyond the 
        exclusive economic zone of any nation.

SEC. 101. DENIAL OF PORT PRIVILEGES AND SANCTIONS FOR HIGH SEAS LARGE-
                    SCALE DRIFTNET FISHING.

    (a) Denial of Port Privileges.--
          (1) Publication of list.--Not later than 30 days 
        after the date of enactment of this Act and 
        periodically thereafter, the Secretary of Commerce, in 
        consultation with the Secretary of State, shall publish 
        a list of nations whose nationals or vessels conduct 
        large-scale driftnet fishing beyond the exclusive 
        economic zone of any nation.
          (2) Denial of port privileges.--The Secretary of the 
        Treasury shall, in accordance with recognized 
        principles of international law--
                  (A) withhold or revoke the clearance required 
                by section 4197 of the Revised Statutes of the 
                United States (46 App. U.S.C. 91) for any 
                large-scale driftnet fishing vessel that is 
                documented under the laws of the United States 
                or of a nation included on a list published 
                under paragraph (1); and
                  (B) deny entry of that vessel to any place in 
                the United States and to the navigable waters 
                of the United States.
          (3) Notification of nation.--Before the publication 
        of a list of nations under paragraph (1), the Secretary 
        of State shall notify each nation included on that list 
        regarding--
                  (A) the effect of that publication on port 
                privileges of vessels of that nation under 
                paragraph (1); and
                  (B) any sanctions or requirements, under this 
                Act or any other law, that may be imposed on 
                that nation if nationals or vessels of that 
                nation continue to conduct large-scale driftnet 
                fishing beyond the exclusive economic zone of 
                any nation after December 31, 1992.
    (b) Sanctions.--
          (1) Identifications.--
                  (A) Initial identifications.--Not later than 
                January 10, 1993, the Secretary of Commerce 
                shall--
                          (i) identify each nation whose 
                        nationals or vessels are conducting 
                        large-scale driftnet fishing beyond the 
                        exclusive economic zone of any nation; 
                        and
                          (ii) notify the President and that 
                        nation of the identification under 
                        clause (i).
                  (B) Additional identifications.--At any time 
                after January 10, 1993, whenever the Secretary 
                of Commerce has reason to believe that the 
                nationals or vessels of any nation are 
                conducting large-scale driftnet fishing beyond 
                the exclusive economic zone of any nation, the 
                Secretary of Commerce shall--
                          (i) identify that nation; and
                          (ii) notify the President and that 
                        nation of the identification under 
                        clause (i).
          (2) Consultations.--Not later than 30 days after a 
        nation is identified under paragraph (1)(B), the 
        President shall enter into consultations with the 
        government of that nation for the purpose of obtaining 
        an agreement that will effect the immediate termination 
        of large-scale driftnet fishing by the nationals or 
        vessels of that nation beyond the exclusive economic 
        zone of any nation.
          (3) Prohibition on imports of fish and fish products 
        and sport fishing equipment.--
                  (A) Prohibition.--The President--
                          (i) upon receipt of notification of 
                        the identification of a nation under 
                        paragraph (1)(A); or
                          (ii) if the consultations with the 
                        government of a nation under paragraph 
                        (2) are not satisfactorily concluded 
                        within 90 days,
                 shall direct the Secretary of the Treasury to 
                prohibit the importation into the United States 
                of fish and fish products and sport fishing 
                equipment (as that term is defined in section 
                4162 of the Internal Revenue Code of 1986 (26 
                U.S.C. 4162)) from that nation.
                  (B) Implementation of prohibition.--With 
                respect to an import prohibition directed under 
                subparagraph (A), the Secretary of the Treasury 
                shall implement such prohibition not later than 
                the date that is 45 days after the date on 
                which the Secretary has received the direction 
                from the President.
                  (C) Public notice of prohibition.--Before the 
                effective date of any import prohibition under 
                this paragraph, the Secretary of the Treasury 
                shall provide public notice of the impending 
                prohibition.
          (4) Additional economic sanctions.--
                  (A) Determination of effectiveness of 
                sanctions.--Not later than 6 months after the 
                date the Secretary of Commerce identifies a 
                nation under paragraph (1), the Secretary shall 
                determine whether--
                          (i) any prohibition established under 
                        paragraph (3) is insufficient to cause 
                        that nation to terminate large-scale 
                        driftnet fishing conducted by its 
                        nationals and vessels beyond the 
                        exclusive economic zone of any nation; 
                        or
                          (ii) That nation has retaliated 
                        against the United States as a result 
                        of that prohibition.
                  (B) Certification.--The Secretary of Commerce 
                shall certify to the President each affirmative 
                determination under subparagraph (A) with 
                respect to a nation.
                  (C) Effect of certification.--Certification 
                by the Secretary of Commerce under subparagraph 
                (B) is deemed to be a certification under 
                section 8(a) of the Fishermen's Protective Act 
                of 1967 (22 U.S.C. 1978(a)), as amended by this 
                Act.

SEC. 102. DURATION OF DENIAL OF PORT PRIVILEGES AND SANCTIONS.

    Any denial of port privileges or sanction under section 101 
with respect to a nation shall remain in effect until such time 
as the Secretary of Commerce certifies to the President and the 
Congress that such nation has terminated large-scale driftnet 
fishing by its nationals and vessels beyond the exclusive 
economic zone of any nation.

           *       *       *       *       *       *       *


SEC. 104. DEFINITIONS.

    In this title, the following definitions apply:
    (1) Fish and fish products.--The term ``fish and fish 
products'' means any aquatic species (including marine mammals 
and plants) and all products thereof exported from a nation, 
whether or not taken by fishing vessels of that nation or 
packed, processed, or otherwise prepared for export in that 
nation or within the jurisdiction thereof.
    (2) Large-scale driftnet fishing.--
          (A) In general.--Except as provided in subparagraph 
        (B), the term ``large-scale driftnet fishing'' means a 
        method of fishing in which a gillnet composed of a 
        panel or panels of webbing, or a series of such 
        gillnets, with a total length of two and one-half 
        kilometers or more is placed in the water and allowed 
        to drift with the currents and winds for the purpose of 
        entangling fish in the webbing.
          (B) Exception.--Until January 1, 1994, the term 
        ``large-scale driftnet fishing'' does not include the 
        use in the northeast Atlantic Ocean of gillnets with a 
        total length not to exceed 5 kilometers if the use is 
        in accordance with regulations adopted by the European 
        Community pursuant to the October 28, 1991, decision by 
        the Council of Fisheries Ministers of the Community.
    (3) Large-scale driftnet fishing vessel.--The term ``large-
scale driftnet fishing vessel'' means any vessel which is--
          (A) used for, equipped to be used for, or of a type 
        which is normally used for large-scale driftnet 
        fishing; or
          (B) used for aiding or assisting one or more vessels 
        at sea in the performance of large-scale driftnet 
        fishing, including preparation, supply, storage, 
        refrigeration, transportation, or processing.

           *       *       *       *       *       *       *


SEC. 202. ENFORCEMENT.

    (a) In General.--Not later than 6 months after the date of 
the enactment of this Act, the Secretary of the department in 
which the Coast Guard is operating, the Secretary of Commerce, 
and the Secretary of Defense shall enter into an agreement 
under section 311(a) of the Magnuson Fishery Conservation and 
Management Act (16 U.S.C. 1861(a)) in order to make more 
effective the enforcement of domestic laws and international 
agreements that conserve and manage the living marine resources 
of the United States.
    (b) Terms.--The agreement entered into under subsection (a) 
shall include--
          (1) procedures for identifying and providing the 
        location of vessels that are in violation of domestic 
        laws or international agreements to conserve and manage 
        the living marine resources of the United States;
          (2) requirements for the use of the surveillance 
        capabilities of the Department of Defense; and
          (3) procedures for communicating vessel locations to 
        the Secretary of Commerce and the Coast Guard.

SEC. 203. TRADE NEGOTIATIONS AND THE ENVIRONMENT.

    It is the sense of the Congress that the President, in 
carrying out multilateral, bilateral, and regional trade 
negotiations, should seek to--
          (1) address environmental issues related to the 
        negotiations;
          (2) modify articles of the General Agreement on 
        Tariffs and Trade (referred to in this section as 
        ``GATT'') to take into consideration the national 
        environmental laws of the GATT Contracting Parties and 
        international environmental treaties;
          (3) secure a working party on trade and the 
        environment within GATT as soon as possible;
          (4) take an active role in developing trade policies 
        that make GATT more responsive to national and 
        international environmental concerns;
          (5) include Federal agencies with environmental 
        expertise during the negotiations to determine the 
        impact of the proposed trade agreements on national 
        environmental law; and
          (6) periodically consult with interested parties 
        concerning the progress of the negotiations.

     Sections 105 and 108 of the Wild Bird Conservation Act of 1992

                  [16 U.S.C. 4904, 4907; P.L. 102-440]

SEC. 105. MORATORIA ON IMPORTS OF EXOTIC BIRDS COVERED BY CONVENTION.

    (a) Immediate Moratorium.--
          (1) Establishment of moratorium.--The importation of 
        any exotic bird of a species identified as a category B 
        species in the report entitled ``Report of the Animals 
        Committee'', adopted by the 8th meeting of the 
        Conference of the Parties to the Convention, is 
        prohibited.
          (2) Termination of moratorium.--A species of exotic 
        birds shall be subject to the prohibition on 
        importation established by paragraph (1) until the 
        Secretary, after notice and an opportunity for public 
        comment--
                  (A) determines that appropriate remedial 
                measures have been taken in the countries of 
                origin for that species, so as to eliminate the 
                threat of trade to the conservation of the 
                species; and
                  (B) makes the findings described in section 
                106(c) for the species and includes the species 
                in the list published under section 106(a).
    (b) Emergency Authority To Suspend Imports of Listed 
Species.--
          (1) Authority to suspend imports.--The Secretary is 
        authorized to suspend the importation of exotic birds 
        of any species that is listed in any Appendix to the 
        Convention, and if applicable remove the species from 
        the list under section 106(a), if the Secretary 
        determines that--
                  (A)(i) trade in that species is detrimental 
                to the species,
                  (ii) there is not sufficient information 
                available on which to base a judgment that the 
                species is not detrimentally affected by trade 
                in that species, or
                  (iii) remedial measures have been recommended 
                by the Standing Committee of the Convention 
                that have not been implemented; and
                  (B) the suspension might be necessary for the 
                conservation of the species.
          (2) Termination of suspension.--A species of exotic 
        birds shall be subject to a suspension of importation 
        under paragraph (1) until the Secretary, after notice 
        and an opportunity for public comment, makes the 
        findings described in section 106(c) and includes the 
        species in the list published under section 106(a).
    (c) Moratorium After One Year for Other Species Listed in 
Appendices.--Effective on the date that is one year after the 
date of the enactment of this Act, the importation of any 
exotic bird of a species that is listed in any Appendix to the 
Convention is prohibited unless the Secretary makes the 
findings described in section 106(c) and includes the species 
in the list published under section 106(a).
    (d) Limitation on Number Imported During First Year.--
Notwithstanding any other provision of this Act, the Secretary 
shall prohibit the importation, during the 1-year period 
beginning on the date of the enactment of this Act, of exotic 
birds of each species that is listed under any Appendix to the 
Convention in excess of the number of that species that were 
imported during the most recent year for which the Secretary 
has complete import data.

SEC. 108. MORATORIA FOR SPECIES NOT COVERED BY CONVENTION.

    (a) In General.--The Secretary shall--
          (1) review periodically the trade in species of 
        exotic birds that are not listed in any Appendix to the 
        Convention; and
          (2) after notice and an opportunity for public 
        comment, establish a moratorium or quota on--
                  (A) importation of any species of exotic 
                birds from one or more countries of origin for 
                the species, if the Secretary determines that--
                          (i) the findings described in section 
                        106(c) (2), (3), and (4) cannot be made 
                        with respect to the species;
                          (ii) the moratorium or quota is 
                        necessary for the conservation of the 
                        species or is otherwise consistent with 
                        the purpose of this title; or
                  (B) the importation of all species of exotic 
                birds from a particular country, if--
                          (i) the country has not developed and 
                        implemented a management program for 
                        exotic birds in trade generally, that 
                        ensures both the conservation and the 
                        humane treatment of exotic birds during 
                        capture, transport, and maintenance; 
                        and
                          (ii) the Secretary finds that the 
                        moratorium or quota is necessary for 
                        the conservation of the species or is 
                        otherwise consistent with the purpose 
                        of this title.
    (b) Termination of Quota or Moratorium.--The Secretary 
shall terminate a quota or moratorium established under 
subsection (a) if the Secretary finds that the reasons for 
establishing the quota or moratorium no longer exist.

           Atlantic Tunas Convention Act of 1975, as amended

                               [Excerpts]

 [16 U.S.C. 971 and 971d; P.L. 94-70, as amended by P.L. 94-265, P.L. 
                 95-33, P.L. 104-43, and P.L. 105-384]

SEC. 2. DEFINITIONS.

  For the purpose of this chapter--
          (1) The term ``Convention'' means the International 
        Convention for the Conservation of Atlantic Tunas, 
        signed at Rio de Janeiro May 14, 1966, including any 
        amendments or protocols which are or become effective 
        for the United States.
          (2) The term ``Commission'' means the International 
        Commission for the Conservation of Atlantic Tunas 
        provided for in article III of the Convention.
          (3) The term ``conservation recommendation'' means 
        any recommendation of the Commission made pursuant to 
        Article VIII of the Convention and acted upon favorably 
        by the Secretary of State under section 5(a) of this 
        Act.
          (4) The term ``Council'' means the Council 
        established within the International Commission for the 
        Conservation of Atlantic Tunas pursuant to article V of 
        the Convention.
          (5) The term ``exclusive economic zone'' means an 
        exclusive economic zone as defined in section 3 of the 
        Magnuson Fishery Conservation and Management Act.
          (6) The term ``fishing'' means the catching, taking, 
        or fishing for or the attempted catching, taking, or 
        fishing for any species of fish covered by the 
        Convention, or any activities in support thereof.
          (7) The term ``fishing vessel'' means any vessel 
        engaged in catching fish or processing or transporting 
        fish loaded on the high seas, or any vessel outfitted 
        for such activities.
          (8) The term ``Panel'' means any panel established by 
        the Commission pursuant to article VI of the 
        Convention.
          (9) The term ``person'' means every individual, 
        partnership, corporation, and association subject to 
        the jurisdiction of the United States.
          (10) The term ``Secretary'' means the Secretary of 
        Commerce.
          (11) The term ``State'' includes each of the States 
        of the United States, the District of Columbia, the 
        Commonwealth of Puerto Rico, and the territories and 
        possessions of the United States.

           *       *       *       *       *       *       *


SEC. 6(C). REGULATIONS TO CARRY OUT COMMISSION RECOMMENDATIONS AND 
                    OTHER MEASURES.

           *       *       *       *       *       *       *


          (4) Upon the promulgation of regulations provided for 
        in paragraph (3) of this subsection, the Secretary 
        shall promulgate, with the concurrence of the Secretary 
        of State and pursuant to the procedures prescribed in 
        paragraph (2) of this subsection, additional 
        regulations which shall become effective simultaneously 
        with the appplication of the regulations provided for 
        in paragraph (3) of this subsection, which prohibit--
                  (A) the entry into the United States of fish 
                in any form of those species which are subject 
                to regulation pursuant to a recommendation of 
                the Commission and which were taken from the 
                Convention area in such manner or in such 
                circumstances as would tend to diminish the 
                effectiveness of the conservation 
                recommendations of the Commission; and
                  (B) the entry into the United States, from 
                any country when the vessels of such country 
                are being used in the conduct of fishing 
                operations in the Convention area in such 
                manner or in such circumstances as would tend 
                to diminish the effectiveness of the 
                conservation recommendations of the Commission, 
                of fish in any form of those species which are 
                subject to regulation pursuant to a 
                recommendation of the Commission and which were 
                taken from the Convention area.
          (5) In the case of repeated and flagrant fishing 
        operations in the Convention area by the vessels of any 
        country which seriously threaten the achievement of the 
        objectives of the Commission's recommendations, the 
        Secretary with the concurrence of the Secretary of 
        State, may by regulations promulgated pursuant to 
        paragraph (2) of this subsection prohibit the entry in 
        any form from such country of other species covered by 
        the Convention as may be under investigation by the 
        Commission and which were taken in the Convention area. 
        Any such prohibition shall continue until the Secreary 
        is satisfied that the condition warranting the 
        prohibition no longer exists, except that all fish in 
        any form of the species under regulation which were 
        previously prohibited from entry shall continue to be 
        prohibited from entry.
          (6) Identification and notification.--
                  (A) Not later than July 1, 1996, and annually 
                thereafter, the Secretary, in consultation with 
                the Secretary of State, the Commissioners, and 
                the advisory committee, shall--
                          (i) identify those nations whose 
                        fishing vessels are fishing, or have 
                        fished during the preceding calendar 
                        year, within the convention area in a 
                        manner or under circumstances that 
                        diminish the effectiveness of a 
                        conservation recommendation;
                          (ii) notify the President and the 
                        nation so identified, including an 
                        explanation of the reasons therefor; 
                        and
                          (iii) publish a list of those Nations 
                        identified under clause (i).
                (B) In identifying those Nations, the Secretary 
                shall consider, based on the best available 
                information, whether those Nations have 
                measures in place for reporting, monitoring, 
                and enforcement, and whether those measures 
                diminish the effectiveness of any conservation 
                recommendation.
          (7) Consultation.--Not later than 30 days after a 
        Nation is notified under paragraph (6), the President 
        may enter into consultations with the Government of 
        that Nation for the purpose of obtaining an agreement 
        that will--
                  (A) effect the immediate termination and 
                prevent the resumption of any fishing operation 
                by vessels of that Nation within the Convention 
                area which is conducted in a manner or under 
                circumstances that diminish the effectiveness 
                of the conservation recommendation;
                  (B) when practicable, require actions by that 
                Nation, or vessels of that Nation, to mitigate 
                the negative impacts of fishing operations on 
                the effectiveness of the conservation 
                recommendation involved, including but not 
                limited to, the imposition of subsequent-year 
                deductions for quota overages; and
                  (C) result in the establishment, if 
                necessary, by such Nation of reporting, 
                monitoring, and enforcement measures that are 
                adequate to ensure the effectiveness of 
                conservation recommendations.

           *       *       *       *       *       *       *


     Section 609 of Public Law 101-162; Conservation of Sea Turtles

                  [16 U.S.C. 1537 note; P.L. 101-162]

    Sec. 609.--(a) The Secretary of State, in consultation with 
the Secretary of Commerce, shall, with respect to those species 
of sea turtles the conservation of which is the subject of 
regulations promulgated by the Secretary of Commerce on June 
29, 1987--
          (1) initiate negotiations as soon as possible for the 
        development of bilateral or multilateral agreements 
        with other nations for the protection and conservation 
        of such species of sea turtles;
          (2) initiate negotiations as soon as possible with 
        all foreign governments which are engaged in, or which 
        have persons or companies engaged in, commercial 
        fishing operations which, as determined by the 
        Secretary of Commerce, may affect adversely such 
        species of sea turtles, for the purposes of entering 
        into bilateral and multilateral treaties with such 
        countries to protect such species of sea turtles;
          (3) encourage such other agreements to promote the 
        purposes of this section with other nations for the 
        protection of specific ocean and land regions which are 
        of special significance to the health and stability of 
        such species of sea turtles;
          (4) initiate the amendment of any existing 
        international treaty for the protection and 
        conservation of such species of sea turtles to which 
        the United States is a party in order to make such 
        treaty consistent with the purposes and policies of 
        this section; and
          (5) provide to the Congress by not later than one 
        year after the date of enactment of this section--
                  (A) a list of each nation which conducts 
                commercial shrimp fishing operations within the 
                geographic range of distribution of such sea 
                turtles;
                  (B) a list of each nation which conducts 
                commercial shrimp fishing operations which may 
                affect adversely such species of sea turtles; 
                and
                  (C) a full report on--
                          (i) the results of his efforts under 
                        this section; and
                          (ii) the status of measures taken by 
                        each nation listed pursuant to 
                        paragraph (A) or (B) to protect and 
                        conserve such sea turtles.
    (b)(1) In General.--The importation of shrimp or products 
from shrimp which have been harvested with commercial fishing 
technology which may affect adversely such species of sea 
turtles shall be prohibited not later than May 1, 1991, except 
as provided in paragraph (2).
          (2) Certification Procedure.--The ban on importation 
        of shrimp or products from shrimp pursuant to paragraph 
        (1) shall not apply if the President shall determine 
        and certify to the Congress not later than May 1, 1991, 
        a annually thereafter that--
                  (A) the government of the harvesting nation 
                has provided documentary evidence of the 
                adoption of a regulatory program governing the 
                incidental taking of such sea turtles in the 
                course of such harvesting that is comparable to 
                that of the United States; and
                  (B) The average rate of that incidental 
                taking by the vessels of the harvesting nation 
                is comparable to the average rate of incidental 
                taking of sea turtles by United States vessels 
                in the course of such harvesting; or
                  (C) the particular fishing environment of the 
                harvesting nation does not pose a threat of the 
                incidental taking of such sea turtles in the 
                course of such harvesting.

                C. NATIONAL SECURITY IMPORT RESTRICTIONS

  Sections 232 and 233 of the Trade Expansion Act of 1962, as amended

    [19 U.S.C. 1862, 1864; P.L. 87-794, as amended by P.L. 93-618, 
Reorganization Plan No. 3 of 1979, P.L. 96-223, and P.L. 100-418; P.L. 
      87-794, as added by P.L. 99-64 and amended by P.L. 100-418]

SEC. 232. SAFEGUARDING NATIONAL SECURITY.

    (a) No action shall be taken pursuant to section 201(a) or 
pursuant to section 350 of the Tariff Act of 1930 to decrease 
or eliminate the duty or other import restriction on any 
article if the President determines that such reduction or 
elimination would threaten to impair the national security.
    (b)(1)(A) Upon request of the head of any department or 
agency, upon application of an interested party, or upon his 
own motion, the Secretary of Commerce (hereafter in the section 
referred to as the ``Secretary'') shall immediately initiate an 
appropriate investigation to determine the effects of the 
national security of imports of the article which is the 
subject of such request, application, or motion.
    (B) The Secretary shall immediately provide notice to the 
Secretary of Defense of any investigation initiated under this 
section.
    (2)(A) In the course of any investigation conducted under 
this subsection, the Secretary shall--
          (i) consult with the Secretary of Defense regarding 
        the methodological and policy questions raised in any 
        investigation initiated under paragraph (1),
          (ii) seek information and advice from, and consult 
        with, appropriate officers of the United States, and
          (iii) if it is appropriate and after reasonable 
        notice, hold public hearings or otherwise afford 
        interested parties an opportunity to present 
        information and advice relevant to such investigation.
    (B) Upon the request of the Secretary, the Secretary of 
Defense shall provide the Secretary an assessment of the 
defense requirements of any article that is the subject of an 
investigation conducted under this section.
    (3)(A) By no later than the date that is 270 days after the 
date on which an investigation is initiated under paragraph (1) 
with respect to any article, the Secretary shall submit to the 
President a report on the findings of such investigation with 
respect to the effect of the importation of such article in 
such quantities or under such circumstances upon the national 
security and, based on such findings, the recommendations of 
the Secretary for action or inaction under this section. If the 
Secretary finds that such article is being imported into the 
United States in such quantities or under such circumstances as 
to threaten to impair the national security, the Secretary 
shall so advise the President in such report.
    (B) Any portion of the report submitted by the Secretary 
under subparagraph (A) which does not contain classified 
information or proprietary information shall be published in 
the Federal Register.
    (4) The Secretary shall prescribe such procedural 
regulations as may be necessary to carry out the provisions of 
this subsection.
    (c)(1)(A) Within 90 days after receiving a report submitted 
under subsection (b)(3)(A) in which the Secretary finds that an 
article is being imported into the United States in such 
quantities or under such circumstances as to threaten to impair 
the national security, the President shall--
          (i) determine whether the President concurs with the 
        finding of the Secretary, and
          (ii) if the President concurs, determine the nature 
        and duration of the action that, in the judgment of the 
        President, must be taken to adjust the imports of the 
        article and its derivatives so that such imports will 
        not threaten to impair the national security.
    (B) If the President determines under subparagraph (A) to 
take action to adjust imports of an article and its 
derivatives, the President shall implement that action by no 
later than the date that is 15 days after the day on which the 
President determines to take action under subparagraph (A).
    (2) By no later than the date that is 30 days after the 
date on which the President makes any determinations under 
paragraph (1), the President shall submit to the Congress a 
written statement of the reasons why the President has decided 
to take action, or refused to take action, under paragraph (1). 
Such statement shall be included in the report published under 
subsection (e).
    (3)(A) If--
          (i) the action taken by the President under paragraph 
        (1) is the negotiation of an agreement which limits or 
        restricts the importation into, or the exportation to, 
        the United States of the article that threatens to 
        impair national security, and
          (ii) either--
                  (I) no such agreement is entered into before 
                the date that is 180 days after the date on 
                which the President makes the determination 
                under paragraph (1)(A) to take such action, or
                  (II) such an agreement that has been entered 
                into is not being carried out or is ineffective 
                in eliminating the threat to the national 
                security posed by imports of such article,
the President shall take such other actions as the President 
deems necessary to adjust the imports of such article so that 
such imports will not threaten to impair the national security. 
The President shall publish in the Federal Register notice of 
any additional actions being taken under this section by reason 
of this subparagraph.
    (B) If--
          (i) clauses (i) and (ii) of subparagraph (A) apply, 
        and
          (ii) the President determines not to take any 
        additional actions under this subsection,
the President shall publish in the Federal Register such 
determination and the reasons on which such determination is 
based.
    (d) For the purposes of this section, the Secretary and the 
President shall, in the light of the requirements of national 
security and without excluding other relevant factors, give 
consideration to domestic production needed for projected 
national defense requirements, the capacity of domestic 
industries to meet such requirements, existing and anticipated 
availabilities of the human resources, products, raw materials, 
and other supplies and services essential to the national 
defense, the requirements of growth of such industries and such 
supplies and services including the investment, exploration, 
and development necessary to assure such growth, and the 
importation of goods in terms of their quantities, 
availabilities, character, and use as those affect such 
industries and the capacity of the United States to meet 
national security requirements. In the administration of this 
section, the Secretary and the President shall further 
recognize the close relation of the economic welfare of the 
Nation to our national security, and shall take into 
consideration the impact of foreign competition on the economic 
welfare of individual domestic industries; and any substantial 
unemployment, decrease in revenues of government, loss of 
skills or investment, or other serious effects resulting from 
the displacement of any domestic products by excessive imports 
shall be considered, without excluding other factors, in 
determining whether such weakening of our internal economy may 
impair the national security.
    (e)(1) Upon the disposition of each request, application, 
or motion under subsection (b), the Secretary shall submit to 
the Congress, and publish in the Federal Register, a report on 
such disposition.
    (2) The President shall submit to the Congress an annual 
report on the operation of the provisions of this section.
    (f)(1) An action taken by the President under subsection 
(c) to adjust imports of petroleum, or petroleum products shall 
cease to have force and effect upon the enactment of a 
disapproval resolution, provided for in paragraph (2), relating 
to that action.
    (2)(A) This paragraph is enacted by the Congress--
          (i) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such is deemed a part of the rules of each 
        House, respectively, but applicable only with respect 
        to the procedures to be followed in that House in the 
        case of disapproval resolutions and such procedures 
        supersede other rules only to the extent that they are 
        inconsistent therewith; and
          (ii) with the full recognition of the constitutional 
        right of either House to change the rules (so far as 
        relating to the procedure of that House) at any time, 
        in the same manner, and to the same extent as any other 
        rule of that House.
    (B) For purposes of this subsection, the term ``disapproval 
resolution'' means only a joint resolution of either House of 
Congress the matter after the resolving clause of which is as 
follows: ``That the Congress disapproves the action taken under 
section 232 of the Trade Expansion Act of 1962 with respect to 
petroleum imports under ------------ dated ------------.'', the 
first blank space being filled with the number of the 
proclamation, Executive order, or other Executive act issued 
under the authority of subsection (c) of such section 232 for 
purposes of adjusting imports of petroleum or petroleum 
products and the second blank being filled with the appropriate 
date.
    (C)(i) All disapproval resolutions introduced in the House 
of Representatives shall be referred to the Committee on Ways 
and Means and all disapproval resolutions introduced in the 
Senate shall be referred to the Committee on Finance.
    (ii) No amendment to a disapproval resolution shall be in 
order in either the House of Representatives or the Senate, and 
no motion to suspend the application of this clause shall be in 
order in either House nor shall it be in order in either House 
for the Presiding Officer to entertain a request to suspend the 
application of this clause by unanimous consent.

SEC. 233. IMPORT SANCTIONS FOR EXPORT VIOLATIONS.

    Any person who violates any national security export 
control imposed under section 5 of the Export Administration 
Act of 1979 (50 U.S.C. App. 2404), or any regulation, order, or 
license issued under that section, may be subject to such 
controls on the importing of goods or technology into the 
United States as the President may prescribe.

                    D. BALANCE OF PAYMENTS AUTHORITY

                  Section 122 of the Trade Act of 1974

                     [19 U.S.C. 2132; P.L. 93-618]

SEC. 122. BALANCE-OF-PAYMENTS AUTHORITY.

    (a) Whenever fundamental international payments problems 
require special import measures to restrict imports--
          (1) to deal with large and serious United States 
        balance-of-payments deficits,
          (2) to prevent an imminent and significant 
        depreciation of the dollar in foreign exchange markets, 
        or
          (3) to cooperate with other countries in correcting 
        an international balance-of-payments disequilibrium,
the President shall proclaim, for a period not exceeding 150 
days (unless such period is extended by Act of Congress)--
                  (A) a temporary import surcharge, not to 
                exceed 15 percent ad valorem, in the form of 
                duties (in addition to those already imposed, 
                if any) on articles imported into the United 
                States;
                  (B) temporary limitations through the use of 
                quotas on the importation of articles into the 
                United States; or
                  (C) both a temporary import surcharge 
                described in subparagraph (A) and temporary 
                limitations described in subparagraph (B).
The authority delegated under subparagraph (B) (and so much of 
subparagraph (C) as relates to subparagraph (B)) may be 
exercised (i) only if international trade or monetary 
agreements to which the United States is a party permit the 
imposition of quotas and a balance-of-payments measure, and 
(ii) only to the extent that the fundamental imbalance cannot 
be dealt with effectively by a surcharge proclaimed pursuant to 
subparagraph (A) and (C). Any temporary import surcharge 
proclaimed pursuant to subparagraph (A) or (C) shall be treated 
as a regular customs duty.
    (b) If the President determines that the imposition of 
import restrictions under subsection (a) will be contrary to 
the national interest of the United States, then he may refrain 
from proclaiming such restrictions and he shall--
          (1) immediately inform Congress of his determination, 
        and
          (2) immediately convene the group of congressional 
        official advisers designated under section 161(a) and 
        consult with them as to the reasons for such 
        determination.
    (c) Whenever the President determines that fundamental 
international payments problems require special import measures 
to increase imports--
          (1) to deal with large and persistent United States 
        balance-of-trade surpluses, as determined on the basis 
        of the cost-insurance-freight value of imports, as 
        reported by the Bureau of the Census, or
          (2) to prevent significant appreciation of the dollar 
        in foreign exchange markets,
the President is authorized to proclaim, for a period of 150 
days (unless such period is extended by Act of Congress)--
                  (A) a temporary reduction (of not more than 5 
                percent ad valorem) in the rate of duty on any 
                article; and
                  (B) a temporary increase in the value or 
                quantity of articles which may be imported 
                under any import restriction, or a temporary 
                suspension of any import restriction.
Import liberalizing actions proclaimed pursuant to this 
subsection shall be of broad and uniform application with 
respect to product coverage except that the President shall not 
proclaim measures under this subsection with respect to those 
articles where in his judgment such action will cause or 
contribute to material injury to firms or workers in any 
domestic industry, including agriculture, mining, fishing, or 
commerce, or to impairment of the national security, or will 
otherwise be contrary to the national interest.
    (d)(1) Import restricting actions proclaimed pursuant to 
subsection (a) shall be applied consistently with the principle 
of nondiscriminatory treatment. In addition, any quota 
proclaimed pursuant to subparagraph (B) of subsection (a) shall 
be applied on a basis which aims at a distribution of trade 
with the United States approaching as closely as possible that 
which various foreign countries might have expected to obtain 
in the absence of such restrictions.
    (2) Notwithstanding paragraph (1), if the President 
determines that the purposes of this section will best be 
served by action against one or more countries having large or 
persistent balance-of-payments surpluses, he may exempt all 
other countries from such action.
    (3) After such time when there enters into force for the 
United States new rules regarding the application of surcharges 
as part of a reform of internationally agreed balance-of-
payments adjustment procedures, the exemption authority 
contained in paragraph (2) shall be applied consistently with 
such new international rules.
    (4) It is the sense of Congress that the President seek 
modifications in international agreements aimed at allowing the 
use of surcharges in place of quantitative restrictions (and 
providing rules to govern the use of such surcharges) as a 
balance-of-payments adjustment measure within the context of 
arrangements for an equitable sharing of balance-of-payments 
adjustment responsibility among deficit and surplus countries.
    (e) Import restricting actions proclaimed pursuant to 
subsection (a) shall be of broad and uniform application with 
respect to product coverage except where the President 
determines, consistently with the purposes of this section, 
that certain articles should not be subject to import 
restricting actions because of the needs of the United States 
economy. Such exceptions shall be limited to the un-
availability of domestic supply at reasonable prices, the 
necessary importation of raw materials, avoiding serious 
dislocations in the supply of imported goods, and other similar 
factors. In addition, uniform exceptions may be made where 
import restricting actions will be unnecessary or ineffective 
in carrying out the purposes of this section, such as with 
respect to articles already subject to import restrictions, 
goods in transit, or goods under binding contract. Neither the 
authorization of import restricting actions nor the 
determination of exceptions with respect to product coverage 
shall be made for the purpose of protecting individual domestic 
industries from import competition.
    (f) Any quantitative limitation proclaimed pursuant to 
subparagraph (B) or (C) of subsection (a) on the quantity or 
value, or both, of an article--
          (1) shall permit the importation of a quantity or 
        value which is not less than the quantity or value of 
        such article imported into the United States from the 
        foreign countries to which such limitation applies 
        during the most recent period which the President 
        determines is representative of imports of such 
        article, and
          (2) shall take into account any increase since the 
        end of such representative period in domestic 
        consumption of such article and like or similar 
        articles of domestic manufacture or production.
    (g) The President may at any time, consistent with the 
provisions of this section, suspend, modify, or terminate, in 
whole or in part, any proclamation under this section either 
during the initial 150-day period of effectiveness or as 
extended by subsequent Act of Congress.
    (h) No provision of law authorizing the termination of 
tariff concessions shall be used to impose a surcharge on 
imports into the United States.

E. IMPLEMENTATION OF THE GATT AGREEMENT ON TECHNICAL BARRIERS TO TRADE 
                          (PRODUCT STANDARDS)

       Excerpts from Title IV of the Trade Agreements Act of 1979

[19 U.S.C. 2531; P.L. 96-39, as amended by Reorganization Plan No. 3 of 
          1979, P.L. 103-182, P.L. 103-465, and P.L. 104-295]

              Subtitle A--Obligations of the United States

SEC. 401. CERTAIN STANDARDS-RELATED ACTIVITIES.

    (a) No Bar To Engaging in Standards Activity.--Nothing in 
this title may be construed--
          (1) to prohibit a Federal agency from engaging in 
        activity related to standards-related measures, 
        including any such measure relating to safety, the 
        protection of human, animal, or plant life or health, 
        the environment, or consumers; or
          (2) to limit the authority of a Federal agency to 
        determine the level it considers appropriate of safety 
        or of protection of human, animal, or plant life or 
        health, the environment, or consumers.
    (b) Unnecessary Obstacles.--Nothing in this title may be 
construed as prohibiting any private person, Federal agency, or 
State agency from engaging in standards-related activities that 
do not create unnecessary obstacles to the foreign commerce of 
the United States. No standards-related activity of any private 
person, Federal agency, or State agency shall be deemed to 
constitute an unnecessary obstacle to the foreign commerce of 
the United States if the demonstrable purpose of the standards-
related activity is to achieve a legitimate domestic objective 
including, but not limited to, the protection of legitimate 
health or safety, essential security, environmental, or 
consumer interests and if such activity does not operate to 
exclude imported products which fully meet the objectives of 
such activity.

SEC. 402. FEDERAL STANDARDS-RELATED ACTIVITIES.

    No Federal agency may engage in any standards-related 
activity that creates unnecessary obstacles to the foreign 
commerce of the United States, including, but not limited to, 
standards-related activities that violate any of the following 
requirements:
          (1) Nondiscriminatory treatment.--Each Federal agency 
        shall ensure, in applying standards-related activities 
        with respect to any imported product, that such product 
        is treated no less favorably than are like domestic or 
        imported products, including, but not limited to, when 
        applying tests or test methods, no less favorable 
        treatment with respect to--
                  (A) the acceptance of the product for testing 
                in comparable situations;
                  (B) the administration of the tests in 
                comparable situations;
                  (C) the fees charged for tests;
                  (D) the release of test results to the 
                exporter, importer, or agents;
                  (E) the siting of testing facilities and the 
                selection of samples for testing; and
                  (F) the treatment of confidential information 
                pertaining to the product.
          (2) Use of international standards.--
                  (A) In general.--Except as provided in 
                subparagraph (B)(ii), each Federal agency, in 
                developing standards, shall take into 
                consideration international standards and 
                shall, if appropriate, base the standards on 
                international standards.
                  (B) Application of requirement.--For purposes 
                of this paragraph, the following apply:
                          (i) International standards not 
                        appropriate.--The reasons for which the 
                        basing of a standard on an 
                        international standard may not be 
                        appropriate include, but are not 
                        limited to, the following:
                                  (I) National security 
                                requirements.
                                  (II) The prevention of 
                                deceptive practices.
                                  (III) The protection of human 
                                health or safety, animal or 
                                plant life or health, or the 
                                environment.
                                  (IV) Fundamental climatic or 
                                other geographical factors.
                                  (V) Fundamental technological 
                                problems.
                          (ii) Regional standards.--In 
                        developing standards, a Federal agency 
                        may, but is not required to, take into 
                        consideration any international 
                        standard promulgated by an 
                        international standards organization 
                        the membership of which is described in 
                        section 451(6)(A)(ii).
          (3) Performance criteria.--Each Federal agency shall, 
        if appropriate, develop standards based on performance 
        criteria, such as those relating to the intended use of 
        a product and the level of performance that the product 
        must achieve under defined conditions, rather than on 
        design criteria, such as those relating to the physical 
        form of the product or the types of material of which 
        the product is made.
          (4) Access for foreign suppliers.--Each Federal 
        agency shall, with respect to any conformity assessment 
        procedure used by it, permit access for obtaining an 
        assessment of conformity and the mark of the system, if 
        any, to foreign suppliers of a product on the same 
        basis as access is permitted to suppliers of like 
        products, whether of domestic or other foreign origin.

SEC. 403. STATE AND PRIVATE STANDARDS-RELATED ACTIVITIES.

    (a) In General.--It is the sense of the Congress that no 
State agency and no private person should engage in any 
standards-related activity that creates unnecessary obstacles 
to the foreign commerce of the United States.
    (b) Presidential Action.--The President shall take such 
reasonable measures as may be available to promote the 
observance by State agencies and private persons, in carrying 
out standards-related activities, of requirements equivalent to 
those imposed on Federal agencies under section 402, and of 
procedures that provide for notification, participation, and 
publication with respect to such activities.

               Subtitle B--Functions of Federal Agencies

SEC. 411. FUNCTIONS OF TRADE REPRESENTATIVE.

    (a) In General.--The Trade Representative shall coordinate 
the consideration of international trade policy issues that 
arise as a result of, and shall develop international trade 
policy as it relates to, the implementation of this title.
    (b) Negotiating Functions.--The Trade Representative has 
responsibility for coordinating United States discussions and 
negotiations with foreign countries for the purpose of 
establishing mutual arrangements with respect to standards-
related activities. In carrying out this responsibility, the 
Trade Representative shall inform and consult with any Federal 
agency having expertise in the matters under discussion and 
negotiation.
    (c) Cross Reference.--For provisions of law regarding 
general authority of the Trade Representative with respect to 
trade agreements, see section 141 of the Trade Act of 1974 (19 
U.S.C. 2171).

           *       *       *       *       *       *       *


     Subtitle C--Administrative and Judicial Proceedings Regarding 
                      Standards-Related Activities

    Chapter 1--Representations Alleging United States Violations of 
                              Obligations

SEC. 421. RIGHT OF ACTION UNDER THIS CHAPTER.

    Except as provided under this chapter, the provisions of 
this subtitle do not create any right of action under the laws 
of the United States with respect to allegations that any 
standards-related activity engaged in within the United States 
violates the obligations of the United States under the 
Agreement.

SEC. 422. REPRESENTATIONS.

    Any--
          (1) Party to the Agreement; or
          (2) foreign country that is not a Party to the 
        Agreement but is found by the Trade Representative to 
        extend rights and privileges to the United States that 
        are substantially the same as those that would be so 
        extended if that foreign country were a Party to the 
        Agreement;
may make a representation to the Trade Representative alleging 
that a standards-related activity engaged in within the United 
States violates the obligations of the United States under the 
Agreement. Any such representation must be made in accordance 
with procedures that the Trade Representative shall by 
regulation prescribe and must provide a reasonable indication 
that the standards-related activity concerned is having a 
significant trade effect. No person other than a Party to the 
Agreement or a foreign country described in paragraph (2) may 
make such a representation.

SEC. 423. ACTION AFTER RECEIPT OF REPRESENTATIONS.

    (a) Review.--Upon receipt of any representation made under 
section 422, the Trade Representative shall review the issues 
concerned in consultation with--
          (1) the agency or person alleged to be engaging in 
        violations under the Agreement;
          (2) the member agencies of the interagency trade 
        organization established under section 242(a) of the 
        Trade Expansion Act of 1962 (19 U.S.C. 1872(a));
          (3) other appropriate Federal agencies; and
          (4) appropriate representatives referred to in 
        section 417.
    (b) Resolution.--The Trade Representative shall undertake 
to resolve, on a mutually satisfactory basis, the issues set 
forth in the representation through consultation with the 
parties concerned.

SEC. 424. PROCEDURE AFTER FINDING BY INTERNATIONAL FORUM.

    (a) In General.--If an appropriate international forum 
finds that a standards-related activity being engaged in within 
the United States conflicts with the obligations of the United 
States under the Agreement, the interagency trade organization 
established under section 242(a) of the Trade Expansion Act of 
1962 (19 U.S.C. 1872(a)) shall review the finding and the 
matters related thereto with a view to recommending appropriate 
action.
    (b) Cross Reference.--For provisions of law regarding 
remedies available to domestic persons alleging that standards 
activities engaged in by Parties to the Agreement (other than 
the United States) violate the obligations of the Agreement, 
see section 301 of the Trade Act of 1974 (19 U.S.C. 2411).

   Chapter 2--Other Proceedings Regarding Certain Standards-Related 
                               Activities

SEC. 441. FINDINGS OF RECIPROCITY REQUIRED IN ADMINISTRATIVE 
                    PROCEEDINGS.

    (a) In General.--Except as provided under chapter 1, no 
Federal agency may consider a complaint or petition against any 
standards-related activity regarding an imported product, if 
that activity is engaged in within the United States and is 
covered by the Agreement, unless the Trade Representative 
finds, and informs the agency concerned in writing, that--
          (1) the country of origin of the imported product is 
        a Party to the Agreement or a foreign country described 
        in section 422(2); and
          (2) the dispute settlement procedures provided under 
        the Agreement are not appropriate.
    (b) Exemptions.--This section does not apply with respect 
to causes of action arising under--
          (1) the antitrust laws as defined in subsection (a) 
        of the first section of the Clayton Act (15 U.S.C. 
        12(a)); or
          (2) statutes administered by the Secretary of 
        Agriculture.
This section does not apply with respect to petitions and 
proceedings that are provided for under the practices of any 
Federal agency for the purpose of ensuring, in accordance with 
section 553 of title 5, United States Code, that interested 
persons are given an opportunity to participate in agency 
rulemaking or to seek the issuance, amendment, or appeal of a 
rule.

SEC. 442. NOT CAUSE FOR STAY IN CERTAIN CIRCUMSTANCES.

    No standards-related activity being engaged in within the 
United States may be stayed in any judicial or administrative 
proceeding on the basis that such activity is currently being 
considered, pursuant to the Agreement, by an international 
forum.

          Subtitle D--Definitions and Miscellaneous Provisions

SEC. 451. DEFINITIONS.

    As used in this title--
          (1) Agreement.--The term ``Agreement'' means the 
        Agreement on Technical Barriers to Trade referred to in 
        section 101(d)(5) of the Uruguay Round Agreements Act.
          (2) Conformity assessment procedure.--The term 
        ``conformity assessment procedure'' means any procedure 
        used, directly or indirectly, to determine that 
        relevant requirements in technical regulations or 
        standards are fulfilled.
          (3) Federal agency.--The term ``Federal agency'' 
        means any of the following within the meaning of 
        chapter 2 of part I of title 5, United States Code:
                  (A) Any executive department.
                  (B) Any military department.
                  (C) Any Government corporation.
                  (D) Any Government-controlled corporation.
                  (E) Any independent establishment.
          (4) International conformity assessment procedure.--
        The term ``international conformity assessment 
        procedure'' means a conformity assessment procedure 
        that is adopted by an international standards 
        organization.
          (5) International standard.--The term ``international 
        standard'' means any standard that is promulgated by an 
        international standards organization.
          (6) International standards organization.--The term 
        ``international standards organization'' means any 
        organization--
                  (A) the membership of which is open to 
                representatives, whether public or private, of 
                the United States and at least all Members; and
                  (B) that is engaged in international 
                standards-related activities.
          (7) International standards-related activity.--The 
        term ``international standards-related activity'' means 
        the negotiation, development, or promulgation of, or 
        any amendment or change to, an international standard, 
        or an international conformity assessment procedure, or 
        both.
          (8) Member.--The term ``Member'' means a WTO member 
        as defined in section 2(10) of the Uruguay Round 
        Agreements Act.
          (9) Private person.--The term ``private person'' 
        means--
                  (A) any individual who is a citizen or 
                national of the United States; and
                  (B) any corporation, partnership, 
                association, or other legal entity organized or 
                existing under the law of any State, whether 
                for profit or not for profit.
          (10) Product.--The term ``product'' means any natural 
        or manufactured item.
          (11) Secretary concerned.--The term ``Secretary 
        concerned'' means the Secretary of Commerce with 
        respect to functions under this title relating to 
        nonagricultural products, and the Secretary of 
        Agriculture with respect to functions under this title 
        relating to agricultural products.
          (12) Trade representative.--The term ``Trade 
        Representative'' means the United States Trade 
        Representative.
          (13) Standard.--The term ``standard'' means a 
        document approved by a recognized body, that provides, 
        for common and repeated use, rules, guidelines, or 
        characteristics for products or related processes and 
        production methods, with which compliance is not 
        mandatory. Such term may also include or deal 
        exclusively with terminology, symbols, packaging, 
        marking, or labeling requirements as they apply to a 
        product, process, or production method.
          (14) Standards-related activity.--The term 
        ``standards-related activity'' means the development, 
        adoption, or application of any standard, technical 
        regulation, or conformity assessment procedure.
          (15) State.--The term ``State'' means any of the 
        several States, the District of Columbia, the 
        Commonwealth of Puerto Rico, the Virgin Islands, 
        American Samoa, Guam and any other Commonwealth, 
        territory, or possession of the United States.
          (16) State agency.--The term ``State agency'' means 
        any department, agency, or other instrumentality of the 
        government of any State or of any political subdivision 
        of any State.
          (17) Technical regulation.--The term ``technical 
        regulation'' means a document which lays down product 
        characteristics or their related processes and 
        production methods, including the applicable 
        administrative provisions, with which compliance is 
        mandatory. Such term may also include or deal 
        exclusively with terminology, symbols, packaging, 
        marking, or labeling requirements as they apply to a 
        product, process, or production method.
          (18) United states.--The term ``United States'', when 
        used in a geographical context, means all States.

SEC. 452. EXEMPTIONS UNDER TITLE.

    This title does not apply to--
          (1) any standards activity engaged in by any Federal 
        agency or State agency for the use (including, but not 
        limited to, use with respect to research and 
        development, production, or consumption) of that agency 
        or the use of another such agency; or
          (2) any standards activity engaged in by any private 
        person solely for use in the production or consumption 
        of products by that person.

SEC. 453. REPORTS TO CONGRESS ON OPERATION OF AGREEMENT.

    As soon as practicable after the close of the 3-year period 
beginning on the date on which this title takes effect, and as 
soon as practicable after the close of each succeeding 3-year 
period through 2001, the Trade Representative shall prepare and 
submit to Congress a report containing an evaluation of the 
operation of the Agreement, both domestically and 
internationally, during the period.

Subtitle E--Standards and Measures Under the North American Free Trade 
                               Agreement

             Chapter 1--Sanitary and Phytosanitary Measures

SEC. 461. GENERAL.

    Nothing in this chapter may be construed--
          (1) to prohibit a Federal agency or State agency from 
        engaging in activity related to sanitary or 
        phytosanitary measures to protect human, animal, or 
        plant life or health; or
          (2) to limit the authority of a Federal agency or 
        State agency to determine the level of protection of 
        human, animal, or plant life or health the agency 
        considers appropriate.

SEC. 462. INQUIRY POINT.

    The standards information center maintained under section 
414 shall, in addition to the functions specified therein, make 
available to the public relevant documents, at such reasonable 
fees as the Secretary of Commerce may prescribe, and 
information regarding--
          (1) any sanitary or phytosanitary measure of general 
        application, including any control or inspection 
        procedure or approval procedure proposed, adopted, or 
        maintained by a Federal or State agency;
          (2) the procedures of a Federal or State agency for 
        risk assessment, and factors the agency considers in 
        conducting the assessment and in establishing the 
        levels of protection that the agency considers 
        appropriate;
          (3) the membership and participation of the Federal 
        Government and State governments in international and 
        regional sanitary and phytosanitary organizations and 
        systems, and in bilateral and multilateral arrangements 
        regarding sanitary and phytosanitary measures, and the 
        provisions of those systems and arrangements; and
          (4) the location of notices of the type required 
        under article 719 of the NAFTA, or where the 
        information contained in such notices can be obtained.

SEC. 463. CHAPTER DEFINITIONS.

    Notwithstanding section 451, for purposes of this chapter--
          (1) Animal.--The term ``animal'' includes fish, bees, 
        and wild fauna.
          (2) Approval procedure.--The term ``approval 
        procedure'' means any registration, notification, or 
        other mandatory administrative procedure for--
                  (A) approving the use of an additive for a 
                stated purpose or under stated conditions, or
                  (B) establishing a tolerance for a stated 
                purpose or under stated conditions for a 
                contaminant,
        in a food, beverage, or feedstuff prior to permitting 
        the use of the additive or the marketing of a food, 
        beverage, or feedstuff containing the additive or 
        contaminant.
          (3) Contaminant.--The term ``contaminant'' includes 
        pesticide and veterinary drug residues and extraneous 
        matter.
          (4) Control or inspection procedure.--The term 
        ``control or inspection procedure'' means any procedure 
        used, directly or indirectly, to determine that a 
        sanitary or phytosanitary measure is fulfilled, 
        including sampling, testing, inspection, evaluation, 
        verification, monitoring, auditing, assurance of 
        conformity, accreditation, registration, certification, 
        or other procedure involving the physical examination 
        of a good, of the packaging of a good, or of the 
        equipment or facilities directly related to production, 
        marketing, or use of a good, but does not mean an 
        approval procedure.
          (5) Plant.--The term ``plant'' includes wild flora.
          (6) Risk assessment.--The term ``risk assessment'' 
        means an evaluation of--
                  (A) the potential for the introduction, 
                establishment or spread of a pest or disease 
                and associated biological and economic 
                consequences; or
                  (B) the potential for adverse effects on 
                human or animal life or health arising from the 
                presence of an additive, contaminant, toxin or 
                disease-causing organism in a food, beverage, 
                or feedstuff.
          (7) Sanitary or phytosanitary measure.--
                  (A) In general.--The term ``sanitary or 
                phytosanitary measure'' means a measure to--
                          (i) protect animal or plant life or 
                        health in the United States from risks 
                        arising from the introduction, 
                        establishment, or spread of a pest or 
                        disease;
                          (ii) protect human or animal life or 
                        health in the United States from risks 
                        arising from the presence of an 
                        additive, contaminant, toxin, or 
                        disease-causing organism in a food, 
                        beverage, or feedstuff;
                          (iii) protect human life or health in 
                        the United States from risks arising 
                        from a disease-causing organism or pest 
                        carried by an animal or plant, or a 
                        product thereof; or
                          (iv) prevent or limit other damage in 
                        the United States arising from the 
                        introduction, establishment, or spread 
                        of a pest.
                  (B) Form.--The form of a sanitary or 
                phytosanitary measure includes--
                          (i) end product criteria;
                          (ii) a product-related processing or 
                        production method;
                          (iii) a testing, inspection, 
                        certification, or approval procedure;
                          (iv) a relevant statistical method;
                          (v) a sampling procedure;
                          (vi) a method of risk assessment;
                          (vii) a packaging and labeling 
                        requirement directly related to food 
                        safety; and
                          (viii) a quarantine treatment, such 
                        as a relevant requirement associated 
                        with the transportation of animals or 
                        plants or with material necessary for 
                        their survival during transportation.

           *       *       *       *       *       *       *


                 Chapter 2--Standards-Related Measures

         Subtitle F--International Standard-Setting Activities

SEC. 491. NOTICE OF UNITED STATES PARTICIPATION IN INTERNATIONAL 
                    STANDARD-SETTING ACTIVITIES.

  (a) In General.--The President shall designate an agency to 
be responsible for informing the public of the sanitary and 
phytosanitary standard-setting activities of each international 
standard-setting organization.
  (b) Notification.--Not later than June 1 of each year, the 
agency designated under subsection (a) with respect to each 
international standard-setting organization shall publish 
notice in the Federal Register of the information specified in 
subsection (c) with respect to that organization. The notice 
shall cover the period ending on June 1 of the year in which 
the notice is published, and beginning on the date of the 
preceding notice under this subsection, except that the first 
such notice shall cover the 1-year period ending on the date of 
the notice.
    (c) Required Information.--The information to be provided 
in the notice under subsection (b) is--
          (1) the sanitary or phytosanitary standards under 
        consideration or planned for consideration by that 
        organization;
          (2) for each sanitary or phytosanitary standard 
        specified in paragraph (1)--
                  (A) a description of the consideration or 
                planned consideration of the standard;
                  (B) whether the United States is 
                participating or plans to participate in the 
                consideration of the standard;
                  (C) the agenda for the United States 
                participation, if any; and
                  (D) the agency responsible for representing 
                the United States with respect to the standard.
    (d) Public Comment.--The agency specified in subsection 
(c)(2)(D) shall provide an opportunity for public comment with 
respect to the standards for which the agency is responsible 
and shall take the comments into account in participating in 
the consideration of the standards and in proposing matters to 
be considered by the organization.

SEC. 492. EQUIVALENCE DETERMINATIONS.

    (a) In General.--An agency may not determine that a 
sanitary or phytosanitary measure of a foreign country is 
equivalent to a sanitary or phytosanitary measure established 
under the authority of Federal law unless the agency determines 
that the sanitary or phytosanitary measure of the foreign 
country provides at least the same level of sanitary or 
phytosanitary protection as the comparable sanitary or 
phytosanitary measure established under the authority of 
Federal law.
    (b) FDA Determination.--If the Commissioner proposes to 
issue a determination of the equivalency of a sanitary or 
phytosanitary measure of a foreign country to a measure that is 
required to be promulgated as a rule under the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) or other statute 
administered by the Food and Drug Administration, the 
Commissioner shall issue a proposed regulation to incorporate 
such determination and shall include in the notice of proposed 
rulemaking the basis for the determination that the sanitary or 
phytosanitary measure of a foreign country provides at least 
the same level of sanitary or phytosanitary protection as the 
comparable Federal sanitary or phytosanitary measure. The 
Commissioner shall provide opportunity for interested persons 
to comment on the proposed regulation. The Commissioner shall 
not issue a final regulation based on the proposal without 
taking into account the comments received.
    (c) Notice.--If the Commissioner proposes to issue a 
determination of the equivalency of a sanitary or phytosanitary 
measure of a foreign country to a sanitary or phytosanitary 
measure of the Food and Drug Administration that is not 
required to be promulgated as a rule under the Federal Food, 
Drug, and Cosmetic Act or other statute administered by the 
Food and Drug Administration, the Commissioner shall publish a 
notice in the Federal Register that identifies the basis for 
the determination that the measure provides at least the same 
level of sanitary or phytosanitary protection as the comparable 
Federal sanitary or phytosanitary measure. The Commissioner 
shall provide opportunity for interested persons to comment on 
the notice. The Commissioner shall not issue a final 
determination on the issue of equivalency without taking into 
account the comments received.

SEC. 493. DEFINITIONS.

    (a) In General.--As used in this subtitle:
          (1) Agency.--The term ``agency'' means a Federal 
        department or agency (or combination of Federal 
        departments or agencies).
          (2) Commissioner.--The term ``Commissioner'' means 
        the Commissioner of Food and Drugs.
          (3) International standard-setting organization.--The 
        term ``international standard-setting organization'' 
        means an organization consisting of representatives of 
        2 or more countries, the purpose of which is to 
        negotiate, develop, promulgate, or amend an 
        international standard.
          (4) Sanitary or phytosanitary standard.--The term 
        ``sanitary or phytosanitary standard'' means a standard 
        intended to form a basis for a sanitary or 
        phytosanitary measure.
          (5) International standard.--The term ``international 
        standard'' means a standard, guideline, or 
        recommendation--
                  (A) regarding food safety, adopted by the 
                Codex Alimentarius Commission, including a 
                standard, guideline, or recommendation 
                regarding decomposition elaborated by the Codex 
                Committee on Fish and Fishery Products, food 
                additives, contaminants, hygienic practice, and 
                methods of analysis and sampling;
                  (B) regarding animal health and zoonoses, 
                developed under the auspices of the 
                International Office of Epizootics;
                  (C) regarding plant health, developed under 
                the auspices of the Secretariat of the 
                International Plant Protection Convention in 
                cooperation with the North American Plant 
                Protection Organization; or
                  (D) established by or developed under any 
                other international organization agreed to by 
                the NAFTA countries (as defined in section 2(4) 
                of the North American Free Trade Agreement 
                Implementation Act) or by the WTO members (as 
                defined in section 2(10) of the Uruguay Round 
                Agreements Act).
    (b) Other Definitions.--The definitions set forth in 
section 463 apply for purposes of this subtitle except that in 
applying paragraph (7) of section 463 with respect to a 
sanitary or phytosanitary measure of a foreign country, any 
reference in such paragraph to the United States shall be 
deemed to be a reference to that foreign country.

                       F. GOVERNMENT PROCUREMENT

                      1. Buy American Requirements

                            Buy American Act

          (Title III of the Act of March 3, 1933, as amended)

 [41 U.S.C. 10a, 10b, 10b-1, and 10c; P.L. 72-428, as amended by P.L. 
                                100-418]

SECTION 1. [41 U.S.C. 10C. DEFINITION OF TERMS USED IN SECTIONS 10A TO 
                    10C.]

    That when used in this title--
          (a) The term ``United States'', when used in a 
        geographical sense, includes the United States and any 
        place subject to the jurisdiction thereof;
          (b) The terms ``public use'', ``public building'', 
        and ``public work'' shall mean use by, public building 
        of, and public work of, the United States, the District 
        of Columbia, Puerto Rico, American Samoa, the Canal 
        Zone, and the Virgin Islands;
          (c) The term ``Federal agency'' has the meaning given 
        such term by section 3 of the Federal Property and 
        Administrative Services Act of 1949 (40 U.S.C. 472), 
        which includes the Departments of the Army, Navy, and 
        Air Force.

SEC. 2. [41 U.S.C. 10A. AMERICAN MATERIALS REQUIRED FOR PUBLIC USE.]

    Notwithstanding any other provision of law, and unless the 
head of the Federal agency concerned shall determine it to be 
inconsistent with the public interest, or the cost to be 
unreasonable, only such unmanufactured articles, materials, and 
supplies as have been mined or produced in the United States, 
and only such manufactured articles, materials, or supplies as 
have been manufactured in the United States substantially all 
from articles, materials, or supplies mined, produced, or 
manufactured, as the case may be, in the United States, shall 
be acquired for public use. This section shall not apply with 
respect to articles, materials, or supplies for use outside the 
United States, or if articles, materials, or supplies [of the 
class or kind to be used or the articles, materials, or 
supplies] from which they are manufactured are not mined, 
produced, or manufactured, as the case may be, in the United 
States in sufficient and reasonably available commercial 
quantities and of a satisfactory quality.

SEC. 3. [41 U.S.C. 10B. CONTRACTS FOR PUBLIC WORKS; SPECIFICATION FOR 
                    USE OF AMERICAN MATERIALS; BLACKLISTING CONTRACTORS 
                    VIOLATING REQUIREMENTS.]

    (a) Every contract for the construction, alteration, or 
repair of any public building or public work in the United 
States growing out of an appropriation heretofore made or 
hereafter to be made shall contain a provision that in the 
performance of the work the contractor, subcontractors, 
material men, or suppliers, shall use only such unmanufactured 
articles, materials, and supplies as have been mined or 
produced in the United States, and only such manufactured 
articles, materials, and supplies as have been manufactured in 
the United States substantially all from articles, materials, 
or supplies mined, produced, or manufactured, as the case may 
be, in the United States except as provided in section 2: 
Provided, however, That if the head of the Federal agency 
making the contract shall find that in respect to some 
particular articles, materials, or supplies it is impracticable 
to make such requirement or that it would unreasonably increase 
the cost, an exception shall be noted in the specifications as 
to that particular article, material, or supply, and a public 
record made of the findings which justified the exception.
    (b) If the head of a Federal agency which has made any 
contract containing the provision required by subsection (a) of 
this section finds that in the performance of such contract 
there has been a failure to comply with such provisions, he 
shall make public his findings, including therein the name of 
the contractor obligated under such contract, and no other 
contract for the construction, alteration, or repair of any 
public building or public work in the United States or 
elsewhere shall be awarded to such contractor, subcontractors, 
material men, or suppliers with which such contractor is 
associated or affiliated, within a period of three years after 
such finding is made public.

SEC. 4. [41 U.S.C. 10B-1. PROHIBITION ON PROCUREMENT CONTRACTS; 
                    EXCEPTIONS.]

    (a) A Federal agency shall not award any contract--
          (1) for the procurement of an article, material, or 
        supply mined, produced, or manufactured--
                  (A) in a signatory country that is considered 
                to be a signatory not in good standing of the 
                Agreement pursuant to section 305(f)(3)(A) of 
                the Trade Agreements Act of 1979; or
                  (B) in a foreign country whose government 
                maintains, in government procurement, a 
                significant and persistent pattern or practice 
                of discrimination against United States 
                products or services which results in 
                identifiable harm to United States businesses, 
                as identified by the President pursuant to 
                section 305(g)(1)(A) of such Act; or
          (2) for the procurement of a service of any 
        contractor or subcontractor that is a citizen or 
        national of a foreign country identified by the 
        President pursuant to section 305(f)(3)(A) or 
        305(g)(1)(A) of such Act, or is owned or controlled 
        directly or indirectly by citizens or nationals of such 
        a foreign country.
    (b) The prohibition on procurement in subsection (a) is 
subject to sections 305(h) and 305(j) of such Act and shall not 
apply--
          (1) with respect to services, articles, materials, or 
        supplies procured and used outside the United States 
        and its territories;
          (2) notwithstanding section 305(g) of such Act, to an 
        eligible product of a country which is a signatory 
        country unless that country is considered to be a 
        signatory not in good standing pursuant to section 
        305(f)(3)(A) of such Act; or
          (3) notwithstanding section 305(g) of such Act, to a 
        country that is a least developed country (as that term 
        is defined in section 308(6) of that Act).
    (c) Notwithstanding subsection (a) of this section, the 
President or the head of a Federal agency may authorize the 
award of a contract or class of contracts if the President or 
the head of the Federal agency--
          (1) determines that such action is necessary--
                  (A) in the public interest;
                  (B) to avoid the restriction of competition 
                in a manner which would limit the procurement 
                in question to, or would establish a preference 
                for, the services, articles, materials, or 
                supplies of a single manufacturer or supplier; 
                or
                  (C) because there would be or are an 
                insufficient number of potential or actual 
                bidders to assure procurement of services, 
                articles, materials, or supplies or requisite 
                quality at competitive prices; and
          (2) notifies the Committee on Governmental Affairs of 
        the Senate, as well as other appropriate Senate 
        committees, and the appropriate committees of the House 
        of Representatives, of such determination--
                  (A) not less than 30 days prior to the date 
                of the award of the contract or the date of 
                authorization of the award of a class of 
                contracts; or
                  (B) if the agency's need for the service, 
                article, material, or supply is of such urgency 
                that the United States would be seriously 
                injured by delaying the award or authorization, 
                not more than 90 days after the date of such 
                award or authorization.
    (d) The authority of the head of a Federal agency under 
subsection (c) shall not apply to contracts subject to 
memorandums of understanding entered into by the Department of 
Defense (or any military department) and a representative of a 
foreign country (or agency or instrumentality thereof). In the 
case of any such contracts, any determinations and notice 
required by subsection (c) shall be made by--
          (1) the President, or
          (2) if delegated, by the Secretary of Defense or the 
        Secretary of the Army, Navy, or Air Force, subject to 
        review and policy guidance by the organization 
        established under section 242(a) of the Trade Expansion 
        Act of 1962 (19 U.S.C. 1872(a)).
    (e) The authority of the head of a Federal agency under 
subsection (c) or (d) of this section may not be delegated.
    (f) Nothing in this section shall restrict the application 
of the prohibition under section 302(a)(1) of the Trade 
Agreements Act of 1979.
    (g)(1) For purposes of this section with respect to 
construction services, a contractor or subcontractor is owned 
or controlled directly or indirectly by citizens or nationals 
of a foreign country if--
          (A) 50 percent or more of the voting stock of the 
        contractor or subcontractor is owned by one or more 
        citizens or nationals of the foreign country;
          (B) the title to 50 percent or more of the stock of 
        the contractor or subcontractor is held subject to 
        trust or fiduciary obligations in favor of one or more 
        citizens or nationals of the foreign country;
          (C) 50 percent or more of the voting stock of the 
        contractor or subcontractor is vested in or exercisable 
        on behalf of one or more citizens or nationals of the 
        foreign country;
          (D) in the case of a corporation--
                  (i) the number of its directors necessary to 
                constitute a quorum are citizens or nationals 
                of the foreign country; or
                  (ii) the corporation is organized under the 
                laws of the foreign country or any subdivision, 
                territory, or possession thereof; or
          (E) in the case of a contractor or subcontractor who 
        is a participant in a joint venture or a member of a 
        partnership, any participant of the joint venture or 
        partner meets any of the criteria in subparagraphs (A) 
        through (D) of this paragraph.
    (2)(A) For purposes of this section, except as provided in 
paragraph (1), a determination of whether a contractor or 
subcontractor is a citizen or national of a foreign country or 
is owned or controlled directly or indirectly by citizens or 
nationals of a foreign country shall be made in accordance with 
policy guidance prescribed by the Administrator for Federal 
Procurement Policy after conducting one or more public hearings 
at which interested parties may present comments. Sections 556 
and 557 of title 5, United States Code, shall not apply to the 
conduct of any such hearing.
    (B) The Administrator shall include in the policy guidance 
prescribed under subparagraph (A) definitions, procedures, 
standards, and rules that, to the extent the Administrator 
considers appropriate and consistent with the applicability of 
such policy guidance to all services (other than construction 
services), is the same as or similar to the definitions, 
procedures, standards, and rules that the Administrator has 
developed and issued for the administration of section 109 of 
the Treasury, Postal Service, and General Government 
Appropriations Act, 1988 (101 Stat. 1329-434).
    (C) The policy guidance required by subparagraph (A) shall 
be prescribed not later than 180 days after the date of 
enactment of this subsection.
    (3)(A) The Administrator for Federal Procurement Policy 
shall conduct an assessment of the current rules under this Act 
for making determinations of country of origin and alternatives 
to such rules. Such assessment shall identify and evaluate (i) 
reasonable alternatives to such rules of origin, including one 
or more alternative rules that require a determination on the 
basis of total cost, and (ii) the specific cost factors that 
should be included in determining total cost.
    (B) In conducting the analysis, the Administrator shall 
consult and seek comment from representatives of United States 
labor and business, other interested United States persons, and 
other Federal agencies. The Administrator shall hold public 
hearings for the purpose of obtaining such comment, and a 
transcript of such hearings shall be appended to the report 
required by subparagraph (C).
    (C) A report on the results of the analysis shall be 
submitted to the appropriate committees of the House of 
Representatives and to the Committee on Governmental Affairs 
and other appropriate committees of the Senate not later than 
18 months after the date of enactment of this subsection. Such 
report shall include proposed policy guidance or any 
recommended legislative changes on the factors to be used in 
making determinations of country of origin.
    (h) As used in this section--
          (1) the term ``Agreement'' means the Agreement on 
        Government Procurement as defined in section 308(1) of 
        the Trade Agreements Act of 1979;
          (2) the term ``signatory'' means a party to the 
        Agreement; and
          (3) the term ``eligible product'' has the meaning 
        given such term by section 308(4) of the Trade 
        Agreements Act of 1979 (19 U.S.C. 2518(4)).

SEC. 5.

    This title shall take effect on the date of its enactment, 
but shall not apply to any contract entered into prior to such 
effective date.

SEC. 6.

    If any provision of this Act, or the application thereof to 
any person or circumstances, is held invalid, the remainder of 
the Act, and the application thereof to other persons or 
circumstances, shall not be affected thereby.
    [Section 7004 of the Omnibus Trade and Competitiveness Act 
of 1988 establishes a sunset on new section 4 and the 
conforming amendments made to the Buy American Act and Act of 
October 29, 1949 by title VII of the 1988 Act:

[SEC. 7004. SUNSET PROVISION.

    [The amendments made by this title shall cease to be 
effective on April 30, 1996, unless the Congress, after 
reviewing the report required by section 305(k) of the Trade 
Agreements Act of 1979, and other relevant information, extends 
such date. After such date, the President may modify or 
terminate any or all actions taken pursuant to such 
amendments.]

     Section 833 of the Defense Production Act of 1950, as amended

     [41 U.S.C. 10b-2; P.L. 102-190, P.L. 103-335, and P.L. 104-61]

SEC. 833. BUY AMERICAN ACT WAIVER RESCISSIONS.

    (a) Determinations by the Secretary of Defense.--(1) If the 
Secretary of Defense, after consultation with the United States 
Trade Representative, determines that a foreign country which 
is party to an agreement described in paragraph (2) has 
violated the terms of the agreement by discriminating against 
certain types of products produced in the United States that 
are covered by the agreement, the Secretary of Defense shall 
rescind the Secretary's blanket waiver of the Buy American Act 
with respect to such types of products produced in that foreign 
country.
    (2) An agreement referred to in paragraph (1) is any 
reciprocal defense procurement memorandum of understanding 
between the United States and a foreign country pursuant to 
which the Secretary of Defense has prospectively waived the Buy 
American Act for certain products in that country.
    (b) Report to Congress.--The Secretary of Defense shall 
submit to Congress a report on the amount of Department of 
Defense purchases from foreign entities in fiscal year 1996. 
Such report shall separately indicate the dollar value of items 
for which the Buy American Act was waived pursuant to any 
agreement described in subsection (a)(2), the Trade Agreement 
Act of 1979 (19 U.S.C. 2501 et seq.), or any international 
agreement to which the United States is a party.
    (c) Buy American Act Defined.--For purposes of this 
section, the term ``Buy American Act'' means title III of the 
Act entitled ``An Act making appropriations for the Treasury 
and Post Office Departments for the fiscal year ending June 30, 
1934, and for other purposes'', approved March 3, 1933 (41 
U.S.C. 10a et seq.).

                        Act of October 29, 1949

        [41 U.S.C 10d; P.L. 81-434, as amended by P.L. 100-418]

SEC. 633. [41 U.S.C. 10D. CLARIFICATION OF CONGRESSIONAL INTENT 
                    REGARDING SECTIONS 10A AND 10B(A).]

    In order to clarify the original intent of Congress, 
hereafter, section 2 and that part of section 3 (a) preceding 
the words ``Provided, however,'' of title III of the Act of 
March 3, 1933 (47 Stat. 1520), shall be regarded as requiring 
the purchase, for public use within the United States, of 
articles, materials, or supplies manufactured in the United 
States in sufficient and reasonably available commercial 
quantities and of a satisfactory quality, unless the head of 
the Federal agency concerned shall determine their purchase to 
be inconsistent with the public interest or their cost to be 
unreasonable.

   2. Implementation of the GATT Agreement on Government Procurement

       Title III of the Trade Agreements Act of 1979, as amended

[19 U.S.C. 2511-2518; P.L. 96-39, as amended by Reorganization Plan No. 
 3 of 1979, P.L. 99-47, P.L. 100-418, P.L. 100-449, P.L. 103-182, P.L. 
                       103-465, and P.L. 104-295]

SEC. 301. GENERAL AUTHORITY TO MODIFY DISCRIMINATORY PURCHASING 
                    REQUIREMENTS.

    (a) Presidental Waiver of Discriminatory Purchasing 
Requirements.--Subject to subsection (f) of this section, the 
President may waive, in whole or in part, with respect to 
eligible products of any foreign country or instrumentality 
designated under subsection (b), and suppliers of such 
products, the application of any law, regulation, procedure, or 
practice regarding Government procurement that would, if 
applied to such products and suppliers, result in treatment 
less favorable than that accorded--
          (1) to United States products and suppliers of such 
        products; or
          (2) to eligible products of another foreign country 
        or instrumentality which is a party to the Agreement 
        and suppliers of such products.
    (b) Designation of Eligible Countries and 
Instrumentalities.--The President may designate a foreign 
country or instrumentality for purposes of subsection (a) only 
if he determines that such country or instrumentality--
          (1) is a country or instrumentality which (A) has 
        become a party to the Agreement or the North American 
        Free Trade Agreement, and (B) will provide appropriate 
        reciprocal competitive government procurement 
        opportunities to United States products and suppliers 
        of such products;
          (2) is a country or instrumentality, other than a 
        major industrial country, which (A) will otherwise 
        assume the obligations of the Agreement, and (B) will 
        provide such opportunities to such products and 
        suppliers;
          (3) is a country or instrumentality, other than a 
        major industrial country, which will provide such 
        opportunities to such products and suppliers; or
          (4) is a least developed country.
    (c) Modification or Withdrawal of Waivers and 
Designations.--The President may modify or withdraw any waiver 
granted pursuant to subsection (a) or designation made pursuant 
to subsection (b).
    (d) Limitations on Waiver Authority Not Effective Unless 
Provision Amended.--The authority of the President under 
subsection (a) to waive any laws, regulations, procedure, or 
practice shall be effective notwithstanding any other provision 
of law hereafter enacted (excluding the provisions of and 
amendments made by the Buy American Act of 1988) unless such 
other provision specifically refers to and amends this section.
    (e) Procurement Procedures by Certain Federal Agencies.--
Notwithstanding any other provision of law, the President may 
direct any agency of the United States listed in Annex 1001.1a-
2 of the North American Free Trade Agreement to procure 
eligible products in compliance with the procedural provisions 
of chapter 10 of such Agreement.
    (f) Small Business and Minority Preferences.--The authority 
of the President under subsection (a) of this section to waive 
any law, regulation, procedure, or practice regarding 
Government procurement does not authorize the waiver of any 
small business or minority preference.

SEC. 302. AUTHORITY TO ENCOURAGE RECIPROCAL COMPETITIVE PROCUREMENT 
                    PRACTICES.

    (a) Authority To Bar Procurement From Nondesignated 
Countries.--
          (1) In general.--Subject to paragraph (2), the 
        President, in order to encourage additional countries 
        to become parties to the Agreement and to provide 
        appropriate reciprocal competitive government 
        procurement opportunities to United States products and 
        suppliers of such products--
                  (A) shall, with respect to procurement 
                covered by the Agreement, prohibit the 
                procurement, after the date on which any waiver 
                under section 301(a) first takes effect, of 
                products--
                          (i) which are products of a foreign 
                        country or instrumentality which is not 
                        designated pursuant to section 301(b), 
                        and
                          (ii) which would otherwise be 
                        eligible products; and
                  (B) may, with respect to procurement covered 
                by the Agreement, take such other actions 
                within the President's authority as the 
                President deems necessary.
          (2) Exception.--Paragraph (1) shall not apply in the 
        case of procurements for which--
                  (A) there are no offers of products or 
                services of the United States or of eligible 
                products; or
                  (B) the offers of products or services of the 
                United States or of eligible products are 
                insufficient to fulfill the requirements of the 
                United States Government.
    (b) Deferrals and Waivers.--Notwithstanding subsection (a), 
but in furtherance of the objective of encouraging countries to 
become parties to the Agreement and provide appropriate 
reciprocal competitive government procurement opportunities to 
United States products and suppliers of such products, the 
President may--
          (1) waive the prohibition required by subsection 
        (a)(1) on procurement of products of a foreign country 
        or instrumentality which has not yet become a party to 
        the Agreement but--
                  (A) has agreed to apply transparent and 
                competitive procedures to its government 
                procurement equivalent to those in the 
                Agreement, and
                  (B) maintains and enforces effective 
                prohibitions on bribery and other corrupt 
                practices in connection with its government 
                procurement;
          (2) authorize agency heads to waive, subject to 
        interagency review and general policy guidance by the 
        organization established under section 242(a) of the 
        Trade Expansion Act of 1962 (19 U.S.C. 1872(a)), such 
        prohibition on a case-by-case basis when in the 
        national interest; and
          (3) authorize the Secretary of Defense to waive, 
        subject to interagency review and policy guidance by 
        the organization established under section 242(a) of 
        the Trade Expansion Act of 1962 (19 U.S.C. 1872(a)), 
        such prohibition for products of any country or 
        instrumentality which enters into a reciprocal 
        procurement agreement with the Department of Defense. 
        Before exercising the waiver authority under paragraph 
        (1), the President shall consult with the appropriate 
        private sector advisory committees established under 
        section 135 of the Trade Act of 1974 and with the 
        appropriate committees of the Congress.
    (c) Report on Impact of Restrictions.--
          (1) Impact of the economy.--On or before July 1, 
        1981, the President shall report to the Committee on 
        Ways and Means and the Committee on Government 
        Operations of the House of Representatives and to the 
        Committee on Finance and the Committee on Governmental 
        Affairs of the Senate on the effects on the United 
        States economy (including effects on employment, 
        production, competition, costs and prices, 
        technological development, export trade, balance of 
        payments, inflation, and the Federal budget) of the 
        refusal of developed countries to allow the Agreement 
        to cover the entities of the governments of such 
        countries which are the principal purchasers of goods 
        and equipment in appropriate product sectors.
          (2) Recommendations for attaining reciprocity.--The 
        report required by paragraph (1) shall include an 
        evaluation of alternative means to obtain equity and 
        reciprocity in such product sectors, including (A) 
        prohibiting the procurement of products of such 
        countries by United States entities not covered by the 
        Agreement, and (B) modifying the application of title 
        III of the Act of March 3, 1933 (41 U.S.C. 10a et 
        seq.), commonly referred to as the Buy American Act. 
        The report shall include an analysis of the effect of 
        such alternative means on the United States economy 
        (including effects on employment, production, 
        competition, costs and prices, technological 
        development, export trade, balance of payments, 
        inflation, and the Federal budget), and on successful 
        negotiations on the expansion of the coverage of the 
        Agreement pursuant to section 304 (a) and (b), other 
        trade negotiating objectives, the relationship of the 
        Federal Government to State and local governments, and 
        such other factors as the President deems appropriate.
          (3) Consultation.--In the preparation of the report 
        required by paragraph (1) and the evaluation and 
        analysis required by paragraph (2), the President shall 
        consult with representatives of the public, industry, 
        and labor, and make available pertinent, 
        nonconfidential information obtained in the course of 
        such preparation to the advisory committees established 
        pursuant to section 135 of the Trade Act of 1974.
    (d) Proposed Action.--
          (1) Presidential report.--On or before October 1, 
        1981, the President shall prepare and transmit to the 
        congressional committees referred to in subsection 
        (c)(1) a report which describes the actions he deems 
        appropriate to establish reciprocity with major 
        industrialized countries in the area of Government 
        procurement.
          (2) Procedure.--
                  (A) Presidential determination.--If the 
                President determines that any changes in 
                existing law or new statutory authority are 
                required to authorize or to implement any 
                action proposed in the report submitted under 
                paragraph (1), he shall, on or after January 1, 
                1982, submit to the Congress a bill to 
                accomplish such changes or provide such new 
                statutory authority. Prior to submitting such a 
                bill, the President shall consult with the 
                appropriate committees of the Congress having 
                jurisdiction over legislation involving subject 
                matters which would be affected by such action, 
                and shall submit to such committees a proposed 
                draft of such bill.
                  (B) Congressional consideration.--The 
                appropriate committee of each House of the 
                Congress shall give a bill submitted pursuant 
                to subparagraph (A) prompt consideration and 
                shall make its best efforts to take final 
                committee action on such bill in an expeditious 
                manner.

SEC. 303. WAIVER OF DISCRIMINATORY PURCHASING REQUIREMENTS WITH RESPECT 
                    TO PURCHASES OF CIVIL AIRCRAFT.

    The President may waive the application of the provisions 
of title III of the Act of March 3, 1933 (41 U.S.C. 10a et 
seq.), popularly referred to as the Buy American Act, in the 
case of any procurement of civil aircraft and related articles 
of a country or instrumentality which is a party to the 
Agreement on Trade in Civil Aircraft referred to in section 
2(c) and approved under section 2(a). The President may modify 
or withdraw any waiver granted pursuant to this section.

SEC. 304. EXPANSION OF THE COVERAGE OF THE AGREEMENT.

    (a) Overall Negotiating Objective.--The President shall 
seek in the renegotiations provided for in article XXIV(7) of 
the Agreement more open and equitable market access abroad, and 
the harmonization, reduction, or elimination of devices which 
distort trade or commerce related to Government procurement, 
with the overall goal of maximizing the economic benefit to the 
United States through maintaining and enlarging foreign markets 
for products of United States agriculture, industry, mining, 
and commerce, the development of fair and equitable market 
opportunities, and open and nondiscriminatory world trade. In 
carrying out the provisions of this subsection, the President 
shall consider the assessment made in the report required under 
section 306(a).
    (b) Sector Negotiating Objectives.--The President shall 
seek, consistent with the overall objective set forth in 
subsection (a) and to the maximum extent feasible, with respect 
to appropriate product sectors, competitive opportunities for 
the export of United States products to the developed countries 
of the world equivalent to the competitive opportunities 
afforded by the United States, taking into account all barriers 
to, and other distortions of, international trade affecting 
that sector.
    (c) Independent Verification Objective.--The President 
shall seek to establish in the renegotiation provided for in 
article XXIV(7) of the Agreement a system for independent 
verification of information provided by parties to the 
Agreement to the Committee on Government Procurement pursuant 
to article XIX(5) of the Agreement.
    (d) Reports on Negotiations.--
          (1) Report in the event of inadequate progress.--If, 
        during the renegotiations of the Agreement, the 
        President at any time determines that the 
        renegotiations are not progressing satisfactorily and 
        are not likely to result, within twelve months of the 
        commencement thereof, in an expansion of the Agreement 
        to cover purchases by the entities of the governments 
        of developed countries which are the principal 
        purchasers of goods and equipment in appropriate 
        product sectors, he shall so report to the 
        congressional committees referred to in section 
        302(c)(1). Taking into account the objectives set forth 
        in subsections (a) and (b) of this section and the 
        factors required to be analyzed under section 302(c), 
        the President shall further report to such committees 
        appropriate actions to seek reciprocity in such product 
        sectors with such countries in the area of government 
        procurement.
          (2) Legislative recommendations.--Taking into account 
        the factors required to be analyzed under section 
        302(c), the President may recommend to the Congress 
        legislation (with respect to entities of the Government 
        which are not covered by the Agreement) which may 
        prohibit such entities from purchasing products of such 
        countries.
          (3) Annual reports.--Each annual report of the 
        President under section 163(a) of the Trade Act of 1974 
        made after the date of enactment of this Act shall 
        report the actions, if any, the President deemed 
        appropriate to establish reciprocity in appropriate 
        product sectors with major industrial countries in the 
        area of government procurement.
    (e) Extension of Nondiscrimination and National 
Treatment.--Before exercising the waiver authority in section 
301 for procurement not covered by the Agreement on the date it 
enters into force with respect to the United States, the 
President shall follow the consultation provisions of section 
135 and chapter 6 of title I of the Trade Act of 1974 for 
private sector and congressional consultations.

SEC. 305. MONITORING AND ENFORCEMENT.

    (a) Monitoring and Enforcement Structure Recommendations.--
In the preparation of the recommendations for the 
reorganization of trade functions, the President shall ensure 
that careful consideration is given to monitoring and enforcing 
the requirements of the Agreement and this title, with 
particular regard to the tendering procedures required by the 
Agreement or otherwise agreed to by a country or 
instrumentality likely to be designated pursuant to section 
301(b).
    (b) Rules of Origin.--
          (1) Advisory rulings and final determinations.--For 
        the purposes of this title, and Secretary of the 
        Treasury shall provide for the prompt issuance of 
        advisory rulings and final determinations on whether, 
        under section 308(4)(B), and article is or would be a 
        product of a foreign country or instrumentality 
        designated pursuant to section 301(b).
          (2) Penalties for fraudulent conduct.--In addition to 
        any other provisions of law which may be applicable, 
        section 1001 of title 18, United States Code, shall 
        apply to fraudulent conduct with respect to the origin 
        of products for purposes of qualifying for a waiver 
        under section 301 or avoiding a prohibition under 
        section 302.
    (c) Report to Congress on Rules of Origin.--
          (1) Domestic administrative practices.--As soon as 
        practicable after the close of the two-year period 
        beginning on the date on which any waiver under section 
        301(a) first takes effect, the President shall prepare 
        and transmit to Congress a report containing an 
        evaluation of administrative practices under any 
        provision of law which requires determinations to be 
        made of the country of origin of goods, products, 
        commodities, or other articles of commerce. Such 
        evaluation shall be accompanied by the President's 
        recommendations for legislative and executive measures 
        required to improve and simplify and to make more 
        uniform and consistent such practices. Such evaluation 
        and recommendations shall take into account the special 
        problems affecting insular possessions of the United 
        States with respect to such practices.
          (2) Foreign administrative practices.--The report 
        required under paragraph (1) shall contain an 
        evaluation of the administrative practices under the 
        laws of each major industrial country which require 
        determinations to be made of the country of origin of 
        goods, products, commodities, or other articles of 
        commerce, including an assessment of such practices on 
        the exports of the United States.
    (d) Annual Report on Foreign Discrimination.--
          (1) Annual report required.--The President shall, no 
        later than April 30 of each year, submit to the 
        appropriate committees of the House of Representatives 
        and the Committee on Governmental Affairs of the 
        Senate, as well as other appropriate Senate committees, 
        a report on the extent to which foreign countries 
        discriminate against United States products or services 
        in making government procurements.
          (2) Identifications required.--In the annual report, 
        the President shall identify (and continue to identify 
        subject to subsections (f)(5) and (g)(3)) any 
        countries, other than least developed countries, that--
                  (A) are signatories to the Agreement and not 
                in compliance with the requirements of the 
                Agreement;
                  (B)(i) are signatories to the Agreement; (ii) 
                are in compliance with the Agreement but, in 
                the government procurement of products or 
                services not covered by the Agreement, maintain 
                a significant and persistent pattern or 
                practice of discrimination against United 
                States products or services which results in 
                identifiable harm to United States businesses; 
                and (iii) whose products or services are 
                acquired in significant amounts by the United 
                States Government;
                  (C)(i) are not signatories to the Agreement; 
                (ii) maintain, in government procurement, a 
                significant and persistent pattern or practice 
                of discrimination against United States 
                products or services which results in 
                identifiable harm to United States businesses; 
                and (iii) whose products or services are 
                acquired in significant amounts by the United 
                States Government;
                  (D)(i) are not signatories to the Agreement;
                  (ii) fail to apply transparent and 
                competitive procedures to its government 
                procurement equivalent to those in the 
                Agreement; and
                  (iii) whose products or services are acquired 
                in significant amounts by the United States 
                Government; or
                  (E)(i) are not signatories to the Agreement;
                  (ii) fail to maintain and enforce effective 
                prohibitions on bribery and other corrupt 
                practices in connection with government 
                procurement; and
                  (iii) whose products or services are acquired 
                in significant amounts by the United States 
                Government.
          (3) Considerations in making identifications.--In 
        making the identifications required by paragraph (1), 
        the President shall--
                  (A) use the requirements of the Agreement, 
                government procurement practices, and the 
                effects of such practices on United States 
                businesses as a basis for evaluating whether 
                the procurement practices of foreign 
                governments do not provide fair market 
                opportunities for United States products or 
                services;
                  (B) take into account, among other factors, 
                whether and to what extent countries that are 
                signatories to the Agreement, and other 
                countries described in paragraph (1) of this 
                subsection--
                          (i) use sole-sourcing or otherwise 
                        noncompetitive procedures for 
                        procurements that could have been 
                        conducted using competitive procedures;
                          (ii) conduct what normally would have 
                        been one procurement as two or more 
                        procurements, to decrease the 
                        anticipated contract values below the 
                        Agreement's value threshold or to make 
                        the procurements less attractive to 
                        United States businesses;
                          (iii) announce procurement 
                        opportunities with inadequate time 
                        intervals for United States businesses 
                        to submit bids; and
                          (iv) use specifications in such a way 
                        as to limit the ability of United 
                        States suppliers to participate in 
                        procurements; and
                  (C) use any other additional criteria deemed 
                appropriate, including the failure to maintain 
                and enforce effective prohibitions on bribery 
                and other corrupt practices in connection with 
                government procurement.
          (4) Contents of reports.--The reports required by 
        this subsection shall include, with respect to each 
        country identified under subparagraph (A), (B), or (C) 
        of paragraph (1), the following:
                  (A) a description of the specific nature of 
                the discrimination, including (for signatory 
                countries) any provision of the Agreement with 
                which the country is not in compliance;
                  (B) an identification of the United States 
                products or services that are affected by the 
                noncompliance or discrimination;
                  (C) an analysis of the impact of the 
                noncompliance or discrimination on the commerce 
                of the United States and the ability of United 
                States companies to compete in foreign 
                government procurement markets; and
                  (D) a description of the status, action 
                taken, and disposition of cases of 
                noncompliance or discrimination identified in 
                the preceding annual report with respect to 
                such country.
          (5) Information and advice from government agencies 
        and united states businesses.--In developing the annual 
        reports required by this subsection, the President 
        shall seek information and advice from executive 
        agencies through the interagency trade organization 
        established under section 242(a) of the Trade Expansion 
        Act of 1962, and from United States businesses in the 
        United States and in countries that are signatories to 
        the Agreement and in other foreign countries whose 
        products or services are acquired in significant 
        amounts by the United States Government.
          (6) Impact of noncompliance.--The President shall 
        take into account, in identifying countries in the 
        annual report and in any action required by this 
        section, the relative impact of any noncompliance with 
        the Agreement or of other discrimination on United 
        States commerce and the extent to which such 
        noncompliance or discrimination has impeded the ability 
        of United States suppliers to participate in 
        procurements on terms comparable to those available to 
        suppliers of the country in question when seeking to 
        sell goods or services to the United States Government.
          (7) Impact on procurement costs.--Such report shall 
        also include an analysis of the impact on United States 
        Government procurement costs that may occur as a 
        consequence of any sanctions that may be required by 
        subsection (f) or (g) of this section.
    (e) Consultation.--No later than the date the annual report 
is submitted under subsection (d)(1), the United States Trade 
Representative, on behalf of the United States, shall request 
consultations with any countries identified in the report to 
obtain their compliance with the Agreement or the elimination 
of their discriminatory procurement practices unless the 
country is identified as discriminatory pursuant to section 
305(d)(1) in the preceding annual report.
    (f) Procedures With Respect to Violations of the 
Agreement.--
          (1) Initiation of dispute settlement procedures.--If, 
        within 60 days after the annual report is submitted 
        under subsection (d)(1), a signatory country identified 
        pursuant to subsection (d)(1)(A) has not complied with 
        the Agreement, then the United States Trade 
        Representative shall promptly request proceedings on 
        the matter under the formal dispute settlement 
        procedures provided under the Agreement unless such 
        proceedings are already underway pursuant to the 
        identification of the signatory country under section 
        305(d)(1) as not in compliance in a preceding annual 
        report.
          (2) Settlement of disputes.--If, before the end of 
        the 18 months following the initiation of dispute 
        settlement procedures--
                  (A) the other participant to the dispute 
                settlement procedures has complied with the 
                Agreement,
                  (B) the other participant to the procedures 
                takes the action recommended as a result of the 
                procedures to the satisfaction of the 
                President,
                  (C) the procedures result in a determination 
                providing a specific period of time for the 
                other participant to bring its practices into 
                compliance with the Agreement, or
                  (D) the procedures result in a determination 
                requiring no action by the other participant, 
                the President shall take no action to limit 
                Government procurement from that participant.
          (3) Sanctions after dispute resolution fails.--
                  (A) Failures resulting in sanctions.--If--
                          (i) within 18 months from the date 
                        dispute settlement procedures are 
                        initiated with a signatory country 
                        pursuant to this section--
                                  (I) such procedures are not 
                                concluded, or
                                  (II) the country has not met 
                                the requirements of 
                                subparagraph (A) or (B) of 
                                paragraph (2), or
                          (ii) the period of time provided for 
                        pursuant to paragraph (2)(C) has 
                        expired and procedures for suspending 
                        concessions under the Agreement have 
                        been completed,
                then the sanctions described in subparagraph 
                (B) shall be imposed.
                  (B) Sanctions.--
                          (i) In general.--If subparagraph (A) 
                        applies to any signatory country--
                                  (I) the signatory country 
                                shall be considered as a 
                                signatory not in good standing 
                                of the Agreement and the 
                                prohibition on procurement 
                                contained in section 4 of the 
                                Act of March 3, 1933 (41 U.S.C. 
                                10b-1) shall apply to such 
                                country, and
                                  (II) the President shall 
                                revoke the waiver of 
                                discriminatory purchasing 
                                requirements granted to the 
                                signatory country pursuant to 
                                section 301(a).
                          (ii) Time sanctions are imposed.--Any 
                        sanction--
                                  (I) described in clause 
                                (i)(I) shall apply from the 
                                date that is the last day of 
                                the 18-month period described 
                                in subparagraph (A)(i) or, in 
                                the case of paragraph (2)(C), 
                                from the date procedures for 
                                suspending concessions under 
                                the Agreement have been 
                                completed, and
                                  (II) described in clause 
                                (i)(II) shall apply beginning 
                                on the day after the date 
                                described in subclause (I).
          (4) Withholding and modification of sanctions.--If 
        the President determines that imposing or continuing 
        the sanctions required by subclause (I) or (II) of 
        paragraph (3)(B)(i) would harm the public interest of 
        the United States, the President may, to the extent 
        necessary to apply appropriate limitations that are 
        equivalent, in their effect, to the noncompliance with 
        Agreement by that signatory country--
                  (A) withhold the imposition of either (but 
                not both) of such sanctions;
                  (B) modify or restrict the application of 
                either or both such sanctions, subject to such 
                terms and conditions as the President considers 
                appropriate; or
                  (C) take any combination of the actions 
                permitted by subparagraph (A) or (B) of this 
                paragraph.
          (5) Termination of sanctions and reinstatement of 
        waivers.--The President may terminate the sanctions 
        imposed under paragraph (3) or (4), reinstate the 
        waiver of discriminatory purchasing requirements 
        granted to that signatory country pursuant to section 
        301(a) of this Act, and remove that country from the 
        report under subsection (d)(1) of this section at such 
        time as the President determines that--
                  (A) the signatory country has complied with 
                the Agreement;
                  (B) the signatory country has taken 
                corrective action as a result of the dispute 
                settlement procedures to the satisfaction of 
                the President; or
                  (C) the dispute settlement procedures result 
                in a determination requiring no action by the 
                other signatory country.
    (g) Procedures With Respect to Other Discrimination.--
          (1) Imposition of sanctions.--If, within 60 days 
        after the annual report is submitted under subsection 
        (d)(1), a country that is identified pursuant to 
        subparagraph (B), (C), (D), or (E) of subsection (d)(2) 
        has not eliminated the practices regarding government 
        procurement identified under subparagraph (B)(ii), 
        (C)(ii), (D)(ii), or (E)(ii) (as the case may be) of 
        subsection (d)(2), then, on the day after the end of 
        such 60-day period--
                  (A) the President shall identify such country 
                as a country that maintains, in government 
                procurement, a significant and persistent 
                pattern or practice of discrimination against 
                United States products or services which 
                results in identifiable harm to United States 
                businesses; and
                  (B) the prohibition on procurement contained 
                in section 4 of the Act of March 3, 1933, shall 
                apply to such country.
          (2) Withholding and modification of sanctions.--If 
        the President determines that imposing or continuing 
        the sanction required by paragraph (1) would harm the 
        public interest of the United States, the President 
        may, to the extent necessary to impose appropriate 
        limitations that are equivalent, in their effect, to 
        the discrimination against United States products or 
        services in government procurement by that country, 
        modify or restrict the application of such sanction, 
        subject to such terms and conditions as the President 
        considers appropriate.
          (3) Termination of sanctions.--The President may 
        terminate the sanctions imposed under paragraph (1) or 
        (2) and remove a country from the report under 
        subsection (d)(1) at such time as the President 
        determines that the country has eliminated the 
        practices regarding government procurement identified 
        under subparagraph (B)(ii), (C)(ii), (D)(ii), or 
        (E)(ii) (as the case may be) of subsection (d)(2).
    (h) Limitations on Imposing Sanctions.--
          (1) Avoiding adverse impact on competition.--The 
        President shall not take any action under subsection 
        (f) or (g) of this section if the President determines 
        that such action--
                  (A) would limit the procurement or class of 
                procurements to, or would establish a 
                preference for, the products or services of a 
                single manufacturer or supplier; or
                  (B) would, with respect to any procurement or 
                class of procurements, result in an 
                insufficient number of potential or actual 
                bidders to assure procurement of services, 
                articles, materials, or supplies of requisite 
                quality at competitive prices.
          (2) Advice from u.s. agencies and businesses.--The 
        President, in taking any action under this subsection 
        to limit government procurements from foreign 
        countries, shall seek the advice of executive agencies 
        through the interagency trade organization established 
        under section 242(a) of the Trade Expansion Act of 1962 
        and the advice of United States businesses and other 
        interested parties.
    (i) Renegotiation To Secure Full and Open Competition.--The 
President shall instruct the United States Trade 
Representative, in conducting renegotiations of the Agreement, 
to seek improvements in the Agreement that will secure full and 
open competition consistent with the requirements imposed by 
the amendments made by the Competition in Contracting Act 
(Public Law 98-369; 98 Stat. 1175).
    (j) Federal Register Notices of Actions.--
          (1) Notices required.--A notice shall be published in 
        the Federal Register on the date of any action under 
        this section, describing--
                  (A) the results of dispute settlement 
                proceedings under subsection (f)(2);
                  (B) any sanction imposed under subsection 
                (f)(3) or (g)(1);
                  (C) any withholding, modification, or 
                restriction of any sanction under subsection 
                (f)(4) or (g)(2); and
                  (D) the termination of any sanction under 
                subsection (f)(5) or (g)(3).
          (2) Publication of determinations lifting 
        sanctions.--A notice describing the termination of any 
        sanction under subsection (f)(5) or (g)(3) shall 
        include a copy of the President's determination under 
        such subsection.
    (k) General Report on Actions Under This Section.--
          (1) Advice to the congress.--The President shall, as 
        necessary, advise the Congress and, by no later than 
        April 30, 1994, submit to the appropriate committees of 
        the House of Representatives, and to the Committee on 
        Governmental Affairs and other appropriate committees 
        of the Senate, a general report on actions taken 
        pursuant to this section.
          (2) Contents of report.--The general report required 
        by this subsection shall include an evaluation of the 
        adequacy and effectiveness of actions taken pursuant to 
        subsections (e), (f), and (g) of this section as a 
        means toward eliminating discriminatory government 
        procurement practices against United States businesses.
          (3) Legislative recommendations.--The general report 
        may also include, if appropriate, legislative 
        recommendations for enhancing the usefulness of this 
        section or for other measures to be used as means for 
        eliminating or responding to discriminatory foreign 
        government procurement practices.
    [Section 7004 of the Omnibus Trade and Competitiveness Act 
of 1988 imposes a sunset on section 305(d) (i.e., the 
amendments made by Title VII of that Act):
          [The amendments made by this title shall cease to be 
        effective on April 30, 1996, unless the Congress, after 
        reviewing the report required by section 305(k) of the 
        Trade Agreements Act of 1979, as amended, and other 
        relevant information, extends such date. After such 
        date, the President may modify or terminate any or all 
        actions taken pursuant to such amendments.]

[SEC. 306. LABOR SURPLUS AREA STUDIES. REPEALED.]

SEC. 307. AVAILABILITY OF INFORMATION TO CONGRESSIONAL ADVISERS.

    The United States Trade Representative shall make available 
to the Members of Congress designated as official advisers 
pursuant to section 161 of the Trade Act of 1974 information 
compiled by the Committee on Government Procurement under 
article XIX(5) of the Agreement.

SEC. 308. DEFINITIONS.

    As used in this title--
          (1) Agreement.--The term ``Agreement'' means the 
        agreement on Government Procurement referred to in 
        section 101(d)(17) of the Uruguay Round Agreements Act, 
        as submitted to the Congress, but including 
        rectifications, modifications, and amendments which are 
        accepted by the United States.
          (2) Civil aircraft.--The term ``civil aircraft and 
        related articles'' means--
                  (A) all aircraft other than aircraft to be 
                purchased for use by the Department of Defense 
                or the United States Coast Guard;
                  (B) the engines (and parts of the components 
                for incorporation therein) of such aircraft;
                  (C) any other parts, components, and 
                subassemblies for incorporation in such 
                aircraft; and
                  (D) any ground flight simulators, and parts 
                and components thereof, for use with respect to 
                such aircraft,
        whether to be purchased for use as original or 
        replacement equipment in the manufacture, repair, 
        maintenance, rebuilding, modification, or conversion of 
        such aircraft, and without regard to whether such 
        aircraft or articles receive duty-free treatment 
        pursuant to section 601(a)(2).
          (3) Developed countries.--The term ``developed 
        countries'' means countries so designated by the 
        President.
          (4) Eligible products.--
                  (A) In general.--The term ``eligible 
                product'' means, with respect to any foreign 
                country or instrumentality that is--
                          (i) a party to the Agreement, a 
                        product or service of that country or 
                        instrumentality which is covered under 
                        the Agreement for procurement by the 
                        United States; or
                          (ii) a party to the North American 
                        Free Trade Agreement, a product or 
                        service of that country or 
                        instrumentality which is covered under 
                        the North American Free Trade Agreement 
                        for procurement by the United States.
                  (B) Rule of origin.--An article is a product 
                of a country or instrumentality only if (i) it 
                is wholly the growth, product, or manufacture 
                of that country or instrumentality, or (ii) in 
                the case of an article which consists in whole 
                or in part of materials from another country or 
                instrumentality, it has been substantially 
                transformed into a new and different article of 
                commerce with a name, character, or use 
                distinct from that of the article or articles 
                from which it was so transformed.
                  (C) Lowered threshold for certain products as 
                a consequence of united states-israel free 
                trade area provisions.--The term ``eligible 
                product'' includes a product or service of 
                Israel for which the United States is obligated 
                to waive Buy National restrictions under--
                          (i) the Agreement on the 
                        Establishment of a Free Trade Area 
                        between the Government of the United 
                        States of America and the Government of 
                        Israel, regardless of the thresholds 
                        provided for in the Agreement (as 
                        defined in paragraph (1)), or
                          (ii) any subsequent agreement between 
                        the United States and Israel which 
                        lowers on a reciprocal basis the 
                        applicable threshold for entities 
                        covered by the Agreement.
                  (D) Lowered threshold for certain products as 
                a consequence of united states-canada free-
                trade agreement.--Except as otherwise agreed by 
                the United States and Canada under paragraph 3 
                of article 1304 of the United States-Canada 
                Free-Trade Agreement, the term ``eligible 
                product'' includes a product or service of 
                Canada having a contract value of $25,000 or 
                more that would be covered for procurement by 
                the United States under the Agreement (as 
                defined in paragraph (1)), but for the 
                thresholds provided for in the Agreement.
          (5) Instrumentality.--The term ``instrumentality'' 
        shall not be construed to include an agency or division 
        of the government of a country, but may be construed to 
        include such arrangements as the European Economic 
        Community
          (6) Least developed country.--The term ``least 
        developed country'' means any country on the United 
        Nations General Assembly list of least developed 
        countries.
          (7) Major industrial country.--The term ``major 
        industrial country'' means any country as defined in 
        section 126 of the Trade Act of 1974 and any 
        instrumentality of such a country.

SEC. 309. EFFECTIVE DATES.

    The provisions of this title shall be effective on the date 
of enactment of this Act, except that--
          (1) the authority of the President to grant waivers 
        under section 303 shall be effective on January 1, 
        1980; and
          (2) the authority of the President to grant waivers 
        under section 301 shall be effective on January 1, 
        1981.


             Chapter 11: LAWS REGULATING EXPORT ACTIVITIES

                           A. EXPORT CONTROLS

      Excerpts from Export Administration Act of 1979, as amended

 [50 U.S.C. App. 2401 et seq.; P.L. 96-72, as amended by P.L. 96-533, 
 P.L. 97-145, P.L. 98-108, P.L. 98-207, P.L. 98-222, P.L. 99-64, P.L. 
99-399, P.L. 99-633, P.L. 100-180, P.L. 100-418, P.L. 100-449 P.L. 101-
           222, P.L. 101-510, P.L. 102-138, and P.L. 102-182]

                 multilateral export control violations

    Sec. 11A. (a) Determination by the President.--The 
President, subject to subsection (c), shall apply sanctions 
under subsection (b) for a period of not less than 2 years and 
not more than 5 years, if the President determines that--
          (1) a foreign person has violated any regulation 
        issued by a country to control exports for national 
        security purposes pursuant to the agreement of the 
        group known as the Coordinating Committee, and
          (2) such violation has resulted in substantial 
        enhancement of Soviet and East bloc capabilities in 
        submarine or antisubmarine warfare, ballistic or 
        antiballistic missile technology, strategic aircraft, 
        command, control, communications and intelligence, or 
        other critical technologies as determined by the 
        President, on the advice of the National Security 
        Council, to represent a serious adverse impact on the 
        strategic balance of forces.
The President shall notify the Congress of each action taken 
under this section. This section, except subsections (h) and 
(j), applies only to violations that occur after the date of 
the enactment of the Export Enhancement Act of 1988.
    (b) Sanctions.--The sanctions referred to in subsection (a) 
shall apply to the foreign person committing the violation, as 
well as to any parent, affiliate, subsidiary, and successor 
entity of the foreign person, and except as provided in 
subsection (c), are as follows:
          (1) a prohibition on contracting with, and 
        procurement of products and services from, a sanctioned 
        person, by any department, agency, or instrumentality 
        of the United States Government, and
          (2) a prohibition on importation into the United 
        States of all products produced by a sanctioned person.
    (c) Exceptions.--The President shall not apply sanctions 
under this section--
          (1) in the case of procurement of defense articles or 
        defense services--
                  (A) under existing contracts or subcontracts, 
                including the exercise of options for 
                production quantities to satisfy United States 
                operational military requirements;
                  (B) if the President determines that the 
                foreign person or other entity to which the 
                sanctions would otherwise be applied is a sole 
                source supplier of essential defense articles 
                or services and no alternative supplier can be 
                identified; or
                  (C) if the President determines that such 
                articles or services are essential to the 
                national security under defense coproduction 
                agreements; or
          (2) to--
                  (A) products or services provided under 
                contracts or other binding agreements (as such 
                terms are defined by the President in 
                regulations) entered into before the date on 
                which the President notifies the Congress of 
                the intention to impose the sanctions;
                  (B) spare parts;
                  (C) component parts, but not finished 
                products, essential to United States products 
                or production;
                  (D) routine servicing and maintenance of 
                products; or
                  (E) information and technology.
    (d) Exclusion.--The President shall not apply sanctions 
under this section to a parent, affiliate, subsidiary, and 
successor entity of a foreign person if the President 
determines that--
          (1) the parent, affiliate, subsidiary, or successor 
        entity (as the case may be) has not knowingly violated 
        the export control regulation violated by the foreign 
        person, and
          (2) the government of the country with jurisdiction 
        over the parent, affiliate, subsidiary, or successor 
        entity had in effect, at the time of the violation by 
        the foreign person, an effective export control system 
        consistent with principles agreed to in the 
        Coordinating Committee, including the following:
                  (A) national laws providing appropriate civil 
                and criminal penalties and statutes of 
                limitations sufficient to deter potential 
                violations;
                  (B) a program to evaluate export license 
                applications that includes sufficient technical 
                expertise to assess the licensing status of 
                exports and ensure the reliability of end-
                users;
                  (C) an enforcement mechanism that provides 
                authority for trained enforcement officers to 
                investigate and prevent illegal exports;
                  (D) a system of export control documentation 
                to verify the movement of goods and technology; 
                and
                  (E) procedures for the coordination and 
                exchange of information concerning violations 
                of the agreement of the Coordinating Committee.
    (e) Definitions.--For purposes of this section--
          (1) the term ``component part'' means any article 
        which is not usable for its intended functions without 
        being imbedded in or integrated into any other product 
        and which, if used in production of a finished product, 
        would be substantially transformed in that process;
          (2) the term ``finished product'' means any article 
        which is usable for its intended functions without 
        being imbedded or integrated into any other product, 
        but in no case shall such term be deemed to include an 
        article produced by a person other than a sanctioned 
        person that contains parts or components of the 
        sanctioned person if the parts or components have been 
        substantially transformed during production of the 
        finished product; and
          (3) the term ``sanctioned person'' means a foreign 
        person, and any parent, affiliate, subsidiary, or 
        successor entity of the foreign person, upon whom 
        sanctions have been imposed under this section.
    (f) Subsequent Modifications of Sanctions.--The President 
may, after consultation with the Congress, limit the scope of 
sanctions applied to a parent, affiliate, subsidiary, or 
successor entity of the foreign person determined to have 
committed the violation on account of which the sanctions were 
imposed if the President determines that--
          (1) the parent, affiliate, subsidiary, or successor 
        entity (as the case may be) has not, on the basis of 
        available evidence, itself violated the export control 
        regulation involved, either directly or through a 
        course of conduct;
          (2) the government with jurisdiction over the parent, 
        affiliate, subsidiary, or successor entity has improved 
        its export control system as measured by the criteria 
        set forth in subsection (d)(2);
          (3) the parent, affiliate, subsidiary, or successor 
        entity, has instituted improvements in internal 
        controls sufficient to detect and prevent violations of 
        the export control regime implemented under paragraph 
        (2); and
          (4) the impact of the sanctions imposed on the 
        parent, affiliate, subsidiary, or successor entity is 
        proportionate to the increased defense expenditures 
        imposed on the United States.
Notwithstanding the preceding sentence, the President may not 
limit the scope of the sanction referred to in subsection 
(b)(1) with respect to the parent of the foreign person 
determined to have committed the violation, until that sanction 
has been in effect for at least 2 years.
    (g) Reports to Congress.--The President shall include in 
the annual report submitted under section 14, a report on the 
status of any sanctions imposed under this section, including 
any exceptions, exclusions, or modifications of sanctions that 
have been applied under subsection (c), (d), or (f).
    (h) Discretionary Imposition of Sanctions.--If the 
President determines that a foreign person has violated a 
regulation issued by a country to control exports for national 
security purposes pursuant to the agreement of the group known 
as the Coordinating Committee, but in a case in which 
subsection (a)(2) may not apply, the President may apply the 
sanctions referred to in subsection (b) against that foreign 
person for a period of not more than 5 years.
    (i) Compensation for Diversion of Militarily Critical 
Technologies to Controlled Countries.--(1) In cases in which 
sanctions have been applied against a foreign person under 
subsection (a), the President shall initiate discussions with 
the foreign person and the government with jurisdiction over 
that foreign person regarding compensation on the part of the 
foreign person in an amount proportionate to the costs of 
research and development and procurement of new defensive 
systems by the United States and the allies of the United 
States to counteract the effort of the technological advance 
achieved by the Soviet Union as a result of the violation by 
that foreign person.
    (2) The President shall, at the time that discussions are 
initiated under paragraph (1), report to the Congress that such 
discussions are being undertaken, and shall report to the 
Congress the outcome of those discussions.
    (j) Other Actions by the President.--Upon making a 
determination under subsection (a) or (h), the President 
shall--
          (1) initiate consultations with the foreign 
        government with jurisdiction over the foreign person 
        who committed the violation involved, in order to seek 
        prompt remedial action by that government;
          (2) initiate discussions with the governments 
        participating in the Coordinating Committee regarding 
        the violation and means to ensure that similar 
        violations do not occur; and
          (3) consult with and report to the Congress on the 
        nature of the violation and the actions the President 
        proposes to take, or has taken, to rectify the 
        situation.
    (k) Damages for Certain Violations.--(1) In any case in 
which the President makes a determination under subsection (a), 
the Secretary of Defense shall determine the costs of restoring 
the military preparedness of the United States on account of 
the violation involved. The Secretary of Defense shall notify 
the Attorney General of his determination, and the Attorney 
General may bring an action for damages, in any appropriate 
district court of the United States, to recover such costs 
against the person who committed the violation, any person that 
is owned or controlled by the person who committed the 
violation, and any person who owns and controls the person who 
committed the violation.
    (3) The total amount awarded in any case brought under 
paragraph (2) shall be determined by the court in light of the 
facts and circumstances, but shall not exceed the amount of the 
net loss to the national security of the United States. An 
action under this subsection shall be commenced not later than 
3 years after the violation occurs, or one year after the 
violation is discovered, whichever is later.
    (l) Definition.--For purposes of this section, the term 
``foreign person'' means any person other than a United States 
person.

                missile proliferation control violations

    Sec. 11B. (a) Violations by United States Persons.--
          (1) Sanctions.--(A) If the President determines that 
        a United States person knowingly--
                  (i) exports, transfers, or otherwise engages 
                in the trade of any item on the MTCR Annex, in 
                violation of the provisions of section 38 (22 
                U.S.C. 2778) or chapter 7 of the Arms Export 
                Control Act, section 5 or 6 of this Act, or any 
                regulations or orders issued under any such 
                provisions,
                  (ii) conspires to or attempts to engage in 
                such export, transfer, or trade, or
                  (iii) facilitates such export, transfer, or 
                trade by any other person,
        then the President shall impose the applicable 
        sanctions described in subparagraph (B).
          (B) The sanctions which apply to a United States 
        person under subparagraph (A) are the following:
                  (i) If the item on the MTCR Annex involved in 
                the export, transfer, or trade is missile 
                equipment or technology within category II of 
                the MTCR Annex, then the President shall deny 
                to such United States person, for a period of 2 
                years, licenses for the transfer of missile 
                equipment or technology controlled under this 
                Act.
                  (ii) If the item on the MTCR Annex involved 
                in the export, transfer, or trade is missile 
                equipment or technology within category I of 
                the MTCR Annex, then the President shall deny 
                to such United States person, for a period of 
                not less than 2 years, all licenses for items 
                the export of which is controlled under this 
                Act.
          (2) Discretionary sanctions.--In the case of any 
        determination referred to in paragraph (1), the 
        Secretary may pursue any other appropriate penalties 
        under section 11 of this Act.
          (3) Waiver.--The President may waive the imposition 
        of sanctions under paragraph (1) on a person with 
        respect to a product or service if the President 
        certifies to the Congress that--
                  (A) the product or service is essential to 
                the national security of the United States; and
                  (B) such person is a sole source supplier of 
                the product or service, the product or service 
                is not available from any alternative reliable 
                supplier, and the need for the product or 
                service cannot be met in a timely manner by 
                improved manufacturing processes or 
                technological developments.
    (b) Transfers of Missile Equipment or Technology by Foreign 
Persons.--
          (1) Sanctions.--(A) Subject to paragraphs (3) through 
        (7), if the President determines that a foreign person, 
        after the date of the enactment of this section, 
        knowingly--
                  (i) exports, transfers, or otherwise engages 
                in the trade of any MTCR equipment or 
                technology that contributes to the design, 
                development, or production of missiles in a 
                country that is not an MTCR adherent and would 
                be, if it were United States-origin equipment 
                or technology, subject to the jurisdiction of 
                the United States under this Act,
                  (ii) conspires to or attempts to engage in 
                such export, transfer, or trade, or
                  (iii) facilitates such export, transfer, or 
                trade by any other person,
        or if the President has made a determination with 
        respect to a foreign person under section 73(a) of the 
        Arms Export Control Act, then the President shall 
        impose on that foreign person the applicable sanctions 
        under subparagraph (B).
          (B) The sanctions which apply to a foreign person 
        under subparagraph (A) are the following:
                  (i) If the item involved in the export, 
                transfer, or trade is within category II of the 
                MTCR Annex, then the President shall deny, for 
                a period of 2 years, licenses for the transfer 
                to such foreign person of missile equipment or 
                technology the export of which is controlled 
                under this Act.
                  (ii) If the item involved in the export, 
                transfer, or trade is within category I of the 
                MTCR Annex, then the President shall deny, for 
                a period of not less than 2 years, licenses for 
                the transfer to such foreign person of items 
                the export of which is controlled under this 
                Act.
                  (iii) If, in addition to actions taken under 
                clauses (i) and (ii), the President determines 
                that the export, transfer, or trade has 
                substantially contributed to the design, 
                development, or production of missiles in a 
                country that is not an MTCR adherent, then the 
                President shall prohibit, for a period of not 
                less than 2 years, the importation into the 
                United States of products produced by that 
                foreign person.
          (2) Inapplicability with respect to mtcr adherents.--
        Paragraph (1) does not apply with respect to--
                  (A) any export, transfer, or trading activity 
                that is authorized by the laws of an MTCR 
                adherent, if such authorization is not obtained 
                by misrepresentation or fraud; or
                  (B) any export, transfer, or trade of an item 
                to an end user in a country that is an MTCR 
                adherent.
          (3) Effect of enforcement actions by mtcr 
        adherents.--Sanctions set forth in paragraph (1) may 
        not be imposed under this subsection on a person with 
        respect to acts described in such paragraph or, if such 
        sanctions are in effect against a person on account of 
        such acts, such sanctions shall be terminated, if an 
        MTCR adherent is taking judicial or other enforcement 
        action against that person with respect to such acts, 
        or that person has been found by the government of an 
        MTCR adherent to be innocent of wrongdoing with respect 
        to such acts.
          (4) Advisory opinions.--The Secretary, in 
        consultation with the Secretary of State and the 
        Secretary of Defense, may, upon the request of any 
        person, issue an advisory opinion to that person as to 
        whether a proposed activity by that person would 
        subject that person to sanctions under this subsection. 
        Any person who relies in good faith on such an advisory 
        opinion which states that the proposed activity would 
        not subject a person to such sanctions, and any person 
        who thereafter engages in such activity, may not be 
        made subject to such sanctions on account of such 
        activity.
          (5) Waiver and report to congress.--(A) In any case 
        other than one in which an advisory opinion has been 
        issued under paragraph (4) stating that a proposed 
        activity would not subject a person to sanctions under 
        this subsection, the President may waive the 
        application of paragraph (1) to a foreign person if the 
        President determines that such waiver is essential to 
        the national security of the United States.
          (B) In the event that the President decides to apply 
        the waiver described in subparagraph (A), the President 
        shall so notify the Congress not less than 20 working 
        days before issuing the waiver. Such notification shall 
        include a report fully articulating the rationale and 
        circumstances which led the President to apply the 
        waiver.
          (6) Additional waiver.--The President may waiver the 
        imposition of sanctions under paragraph (1) on a person 
        with respect to a product or service if the President 
        certifies to the Congress that--
                  (A) the product or service is essential to 
                the national security of the United States; and
                  (B) such person is a sole source supplier of 
                the product or service, the product or service 
                is not available from any alternative reliable 
                supplier, and the need for the product or 
                service cannot be met in a timely manner by 
                improved manufacturing processes or 
                technological developments.
          (7) Exceptions.--The President shall not apply the 
        sanction under this subsection prohibiting the 
        importation of the products of a foreign person--
                  (A) in the case of procurement of defense 
                articles or defense services--
                          (i) under existing contracts or 
                        subcontracts, including the exercise of 
                        options for production quantities to 
                        satisfy requirements essential to the 
                        national security of the United States;
                          (ii) if the President determines that 
                        the person to which the sanctions would 
                        be applied is a sole source supplier of 
                        the defense articles and services, that 
                        the defense articles or services are 
                        essential to the national security of 
                        the United States, and that alternative 
                        sources are not readily or reasonably 
                        available; or
                          (iii) if the President determines 
                        that such articles or services are 
                        essential to the national security of 
                        the United States under defense 
                        coproduction agreements or NATO 
                        Programs of Cooperation;
                  (B) to products or services provided under 
                contracts entered into before the date on which 
                the President publishes his intention to impose 
                the sanctions; or
                  (C) to--
                          (i) spare parts,
                          (ii) component parts, but not 
                        finished products, essential to United 
                        States products or production,
                          (iii) routine services and 
                        maintenance of products, to the extent 
                        that alternative sources are not 
                        readily or reasonably available, or
                          (iv) information and technology 
                        essential to United States products or 
                        production.
    (c) Definitions.--For purposes of this section and 
subsections (k) and (l) of section 6--
          (1) the term ``missile'' means a category I system as 
        defined in the MTCR Annex, and any other unmanned 
        delivery system of similar capability, as well as the 
        specially designed production facilities for these 
        systems;
          (2) the term ``Missile Technology Control Regime'' or 
        ``MTCR'' means the policy statement, between the United 
        States, the United Kingdom, the Federal Republic of 
        Germany, France, Italy, Canada, and Japan, announced on 
        April 16, 1987, to restrict sensitive missile-relevant 
        transfers based on the MTCR Annex, and any amendments 
        thereto;
          (3) the term ``MTCR adherent'' means a country that 
        participates in the MTCR or that, pursuant to an 
        international understanding to which the United States 
        is a party, controls MTCR equipment or technology in 
        accordance with the criteria and standards set forth in 
        the MTCR;
          (4) the term ``MTCR Annex'' means the Guidelines and 
        Equipment and Technology Annex of the MTCR, and any 
        amendments thereto;
          (5) the terms ``missile equipment or technology'' and 
        ``MTCR equipment or technology'' means those items 
        listed in category I or category II of the MTCR Annex;
          (6) the term ``foreign person'' means any person 
        other than a United States person;
          (7)(A) the term ``person'' means a natural person as 
        well as a corporation, business association, 
        partnership, society, trust, any other nongovernmental 
        entity, organization, or group, and any governmental 
        entity operating as a business enterprise, and any 
        successor of any such entity; and
          (B) in the case of countries where it may be 
        impossible to identify a specific governmental entity 
        referred to in subparagraph (A), the term ``person'' 
        means--
                  (i) all activities of that government 
                relating to the development or production of 
                any missile equipment or technology; and
                  (ii) all activities of that government 
                affecting the development or production of 
                aircraft, electronics, and space systems or 
                equipment; and
          (8) the term ``otherwise engaged in the trade of'' 
        means, with respect to a particular export or transfer, 
        to be a freight forwarder or designated exporting 
        agent, or a consignee or end user of the item to be 
        exported or transferred.

        chemical and biological weapons proliferation sanctions

    Sec. 11C. (a) Imposition of Sanction.--
          (1) Determination by the president.--Except as 
        provided in subsection (b)(2), the President shall 
        impose the sanction described in subsection (c) if the 
        President determines that a foreign person, on or after 
        the date of the enactment of this section, has 
        knowingly and materially contributed--
                  (A) through the export from the United States 
                of any goods or technology that are subject to 
                the jurisdiction of the United States under 
                this Act, or
                  (B) through the export from any other country 
                of any goods or technology that would be, if 
                they were United States goods or technology, 
                subject to the jurisdiction of the United 
                States under this Act,
        to the efforts by any foreign country, project, or 
        entity described in paragraph (2) to use, develop, 
        produce, stockpile, or otherwise acquire chemical or 
        biological weapons.
          (2) Countries, projects, or entities receiving 
        assistance.--Paragraph (1) applies in the case of--
                  (A) any foreign country that the President 
                determines has, at any time after January 1, 
                1980--
                          (i) used chemical or biological 
                        weapons in violation of international 
                        law;
                          (ii) used lethal chemical or 
                        biological weapons against its own 
                        nationals; or
                          (iii) made substantial preparations 
                        to engage in the activities described 
                        in clause (i) or (ii);
                  (B) any foreign country whose government is 
                determined for purposes of section 6(j) of this 
                Act to be a government that has repeatedly 
                provided support for acts of international 
                terrorism; or
                  (C) any other foreign country, project, or 
                entity designated by the President for purposes 
                of this section.
          (3) Persons against whom sanction is to be imposed.--
        A sanction shall be imposed pursuant to paragraph (1) 
        on--
                  (A) the foreign person with respect to which 
                the President makes the determination described 
                in that paragraph;
                  (B) any successor entity to that foreign 
                person;
                  (C) any foreign person that is a parent or 
                subsidiary of that foreign person if that 
                parent or subsidiary knowingly assisted in the 
                activities which were the basis of that 
                determination; and
                  (D) any foreign person that is an affiliate 
                of that foreign person if that affiliate 
                knowingly assisted in the activities which were 
                the basis of that determination and if that 
                affiliate is controlled in fact by that foreign 
                person.
    (b) Consultations With and Actions by Foreign Government of 
Jurisdiction.--
          (1) Consultations.--If the President makes the 
        determination described in subsection (a)(1) with 
        respect to a foreign person, the Congress urges the 
        President to initiate consultations immediately with 
        the government with primary jurisdiction over that 
        foreign person with respect to the imposition of a 
        sanction pursuant to this section.
          (2) Actions by government of jurisdiction.--In order 
        to pursue such consultations with that government, the 
        President may delay the imposition of a sanction 
        pursuant to this section for a period of up to 90 days. 
        Following these consultations, the President shall 
        impose the sanction unless the President determines and 
        certifies to the Congress that that government has 
        taken specific and effective actions, including 
        appropriate penalties, to terminate the involvement of 
        the foreign person in the activities described in 
        subsection (a)(1). The President may delay the 
        imposition of the sanction for an additional period of 
        up to 90 days if the President determines and certifies 
        to the Congress that that government is in the process 
        of taking the actions described in the preceding 
        sentence.
          (3) Report to congress.--The President shall report 
        to the Congress, not later than 90 days after making a 
        determination under subsection (a)(1), on the status of 
        consultations with the appropriate government under 
        this subsection, and the basis for any determination 
        under paragraph (2) of this subsection that such 
        government has taken specific corrective actions.
    (c) Sanction.--
          (1) Description of sanction.--The sanction to be 
        imposed pursuant to subsection (a)(1) is, except as 
        provided in paragraph (2) of this subsection, that the 
        United States Government shall not procure, or enter 
        into any contract for the procurement of, any goods or 
        services from any person described in subsection 
        (a)(3).
          (2) Exceptions.--The President shall not be required 
        to apply or maintain a sanction under this section--
                  (A) in the case of procurement of defense 
                articles or defense services--
                          (i) under existing contracts or 
                        subcontracts, including the exercise of 
                        options for production quantities to 
                        satisfy United States operational 
                        military requirements;
                          (ii) if the President determines that 
                        the person or other entity to which the 
                        sanction would otherwise be applied is 
                        a sole source supplier of the defense 
                        articles or services, that the defense 
                        articles or services are essential, and 
                        that alternative sources are not 
                        readily or reasonably available; or
                          (iii) if the President determines 
                        that such articles or services are 
                        essential to the national security 
                        under defense coproduction agreements;
                  (B) to products or services provided under 
                contracts entered into before the date on which 
                the President publishes his intention to impose 
                the sanction;
                  (C) to--
                          (i) spare parts,
                          (ii) component parts, but not 
                        finished products, essential to United 
                        States products or production, or
                          (iii) routine servicing and 
                        maintenance of products, to the extent 
                        that alternative sources are not 
                        readily or reasonably available;
                  (D) to information and technology essential 
                to United States products or production; or
                  (E) to medical or other humanitarian items.
    (d) Termination of Sanction.--A sanction imposed pursuant 
to this section shall apply for a period of at least 12 months 
following the imposition of the sanction and shall cease to 
apply thereafter only if the President determines and certifies 
to the Congress that reliable information indicates that the 
foreign person with respect to which the determination was made 
under subsection (a)(1) has ceased to aid or abet any foreign 
government, project, or entity in its efforts to acquire 
chemical or biological weapons capability as described in that 
subsection.
    (e) Waiver.--
          (1) Criterion for waiver.--The President may waive 
        the application of the sanction imposed on any person 
        pursuant to this section, after the end of the 12-month 
        period beginning on the date on which the sanction was 
        imposed on that person, if the President determines and 
        certifies to the Congress that such waiver is important 
        to the national security interests of the United 
        States.
          (2) Notification of and report to congress.--If the 
        President decides to exercise the waiver authority 
        provided in paragraph (1), the President shall so 
        notify the Congress not less than 20 days before the 
        waiver takes effect. Such notification shall include a 
        report fully articulating the rationale and 
        circumstances which led the President to exercise the 
        waiver authority.
    (f) Definition of Foreign Person.--For purposes of this 
section, the term ``foreign person'' means--
          (1) an individual who is not a citizen of the United 
        States or an alien admitted for permanent residence to 
        the United States; or
          (2) a corporation, partnership, or other entity which 
        is created or organized under the laws of a foreign 
        country or which has its principal place of business 
        outside the United States.

                   B. EXPORT FINANCING AND PROMOTION


               1. Agriculture Export Sales and Promotion


               Agricultural Trade Act of 1978, as amended


                               [Excerpts]


 [7 U.S.C. 5621 et seq.; P.L. 95-501, as amended by P.L. 101-624, P.L. 
         102-237, P.L. 102-511, P.L. 103-465, and P.L. 104-127]

TITLE I--GENERAL PROVISIONS

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SEC. 106. IMPLEMENTATION OF COMMITMENTS UNDER URUGUAY ROUND AGREEMENTS.

  Not later than September 30 of each year, the Secretary shall 
evaluate whether the obligations undertaken by foreign 
countries under the Uruguay Round Agreement on Agriculture are 
being fully implemented. If the Secretary has reason to believe 
(based on the evaluation) that any foreign country, by not 
implementing the obligations of the country, may be 
significantly constraining an opportunity for United States 
agricultural exports, the Secretary shall--
          (1) submit the evaluation to the United States Trade 
        Representative; and
          (2) transmit a copy of the evaluation to the 
        Committee on Agriculture, and the Committee on Ways and 
        Means, of the House of Representatives and the 
        Committee on Agriculture, Nutrition, and Forestry, and 
        the Committee on Finance, of the Senate.

           *       *       *       *       *       *       *


                 TITLE III--EXPORT ENHANCEMENT PROGRAM


SEC. 301. EXPORT ENHANCEMENT PROGRAM.

  (a)  In General.--The Commodity Credit Corporation shall 
carry out an export enhancement program in accordance with this 
section to encourage the commercial sale of United States 
agricultural commodities in world markets at competitive 
prices. The program shall be carried out in a market sensitive 
manner. Activities under the program shall not be limited to 
responses to unfair trade practices.
  (b) Export Bonus.--
          (1) In general.--In carrying out the program 
        established under this section, the Commodity Credit 
        Corporation may--
                  (A) make agricultural commodities, acquired 
                by the Commodity Credit Corporation, available 
                to exporters, users, processors, or foreign 
                purchasers at no cost either directly or 
                through the issuance of commodity certificates; 
                and
                  (B) make cash payments to exporters, users, 
                and processors.
          (2) Calculation of bonus levels.--The Commodity 
        Credit Corporation shall--
                  (A) maintain an established procedure for 
                evaluating program bonus requests, with 
                guidelines for determining prevailing market 
                prices for targeted commodities and 
                destinations to be used in the calculation of 
                acceptable bonus levels;
                  (B) use a clear set of established procedures 
                for measuring transportation and incidental 
                costs to be used in the calculation of 
                acceptable bonus levels and for determining the 
                amount of such costs actually incurred; and
                  (C) maintain consistent and effective 
                controls and procedures for auditing and 
                reviewing payment of bonuses and for securing 
                refunds where appropriate.
          (3) Disclosure of information.--The Secretary may, 
        notwithstanding the provisions of section 552 of title 
        5, United States Code, provide for withholding from the 
        public the procedures and guidelines established under 
        paragraphs (2) and (B) if the Secretary determines that 
        release of such information would adversely affect the 
        operation of the program. Nothing in this paragraph 
        shall be construed to authorize the withholding of 
        information, including such procedures and guidelines, 
        from the Congress.
          (4) Competitive disadvantage.--The Secretary shall 
        take such action as is necessary to ensure that equal 
        treatment is provided to domestic and foreign 
        purchasers and users of agricultural commodities in any 
        case in which the importation of a manufactured product 
        made, in whole or in part, from a commodity made 
        available for export under this section would place 
        domestic users of the commodity at a competitive 
        disadvantage.
          (5) Different commodities.--The Commodity Credit 
        Corporation may provide to an exporter, user, or 
        processor, or foreign purchaser, under the program 
        established under this section, agricultural 
        commodities of a kind different than the agricultural 
        commodity involved in the transaction for which 
        assistance under this section is being provided.
          (6) Other export programs.--The Commodity Credit 
        Corporation may provide bonuses under this section in 
        conjunction with other export promotion programs 
        conducted by the Secretary or the Commodity Credit 
        Corporation.
          (7) Avoidance of preferential application.--When 
        using the authorities of this section to promote the 
        exporting of wheat, the Secretary shall make reasonable 
        efforts to avoid giving a preference to one class of 
        wheat disproportionately more than another class.
          (8) Displacement.--The Secretary shall avoid the 
        displacement of usual marketings of United States 
        agricultural commodities in carrying out this section.
  (c) Priority in the Case of Livestock.--In the case of 
proposals for bonuses for dairy cattle or other appropriate 
livestock, the Commodity Credit Corporation shall give priority 
to proposals that include, in connection with the purchase of 
the livestock, appropriate herd management training, veterinary 
services, nutritional training, and other technical assistance 
necessary for the adaptation of the livestock to foreign 
environments.
  (d) Inapplicability of Price Restrictions.--Any price 
restrictions that otherwise may be applicable to dispositions 
of agricultural commodities owned by the Commodity Credit 
Corporation shall not apply to agricultural commodities 
provided under this section.
  (e) Funding Levels.--
          (1)  In general.--The Commodity Credit Corporation 
        shall make available to carry out the program 
        established under this section not more than--
                  (A) $350,000,000 for fiscal year 1996;
                  (B) $250,000,000 for fiscal year 1997;
                  (C) $500,000,000 for fiscal year 1998;
                  (D) $550,000,000 for fiscal year 1999;
                  (E) $579,000,000 for fiscal year 2000;
                  (F) $478,000,000 for fiscal year 2001; and
                  (G) $478,000,000 for fiscal year 2002.
          (2)  Set-asides.--(A) For each fiscal year, the 
        Corporation shall, to the extent practicable and 
        subject to subparagraph (B), ensure that no less than 
        25 percent of the total of--
                  (i) the funds expended, and
                  (ii) the value of any commodities made 
                available, under this section in connection 
                with sales of agricultural commodities to the 
                independent states of the former Soviet Union 
                is used to promote the export of processed and 
                high-value United States agricultural products 
                and that the balance of the funds expended and 
                commodities made available under this section 
                in connection with such sales is used to 
                promote the export of bulk or raw United States 
                agricultural commodities.
          (B) The 25 percent requirement of subparagraph (A) 
        shall apply for a fiscal year only to the extent that 
        the percentage of the total of--
                  (i) the funds expended, and
                  (ii) the value of commodities made available, 
                for that fiscal year under this section to 
                promote the export to all countries of 
                processed and high-value United States 
                agricultural products is less than 15 percent.
  (f)  Effect on Third Countries.--It is not the purpose of the 
program established under this section to affect adversely the 
exports of fairly traded agricultural commodities.
  (g)  Consistency With International Obligations.--
Notwithstanding any other provision of this section, the 
Commodity Credit Corporation shall administer and carry out the 
program authorized by this section in a manner consistent, as 
determined by the President, with the obligations undertaken by 
the United States set forth in the Uruguay Round Agreements.
  (h)  Priority Funding for Intermediate Products.--
          (1) In general.--Effective beginning in fiscal year 
        1996, and consistent, as determined by the Secretary, 
        with the obligations and reduction commitments 
        undertaken by the United States under the Uruguay Round 
        Agreements, the Secretary may make available not more 
        than $100,000,000 for each fiscal year under this 
        section for the sale of intermediate agricultural 
        products in sufficient quantities to attain the volume 
        of export sales consistent with the volume of 
        intermediate agricultural products exported by the 
        United States during the Uruguay Round base period 
        years of 1986 through 1990.
          (2) Additional assistance.--Notwithstanding paragraph 
        (1), if the export sale of any intermediate 
        agricultural product attains the volume of export sales 
        consistent with the volume of the intermediate 
        agricultural product exported by the United States 
        during the Uruguay Round base period years of 1986 
        through 1990, the Secretary may make available 
        additional amounts under this section for the 
        encouragement of export sales of the intermediate 
        agricultural product.

SEC. 302. RELIEF FROM UNFAIR TRADE PRACTICES.

  (a) Use of Programs.--
          (1) In general.--The Secretary may, for each article 
        described in paragraph (2), make available some or all 
        of the commercial export promotion programs of the 
        Department of Agriculture and the Commodity Credit 
        Corporation to help mitigate or offset the effects of 
        the unfair trade practice serving as the basis for the 
        proceeding described in paragraph (2).
          (2) Commodities specified.--Paragraph (1) shall apply 
        in the case of articles for which the United States has 
        instituted, under any international trade agreement, 
        any dispute settlement proceeding based on an unfair 
        trade practice if such proceeding has been prevented 
        from progressing to a decision by the refusal of the 
        party maintaining the unfair trade practice to permit 
        the proceeding to progress.
  (b) Consultations Required.--For any article described in 
subsection (a)(2), the Secretary shall--
          (1) promptly consult with representatives of the 
        industry producing such articles and other allied 
        groups or individuals regarding specific actions or the 
        development of an integrated marketing strategy 
        utilizing some or all of the commercial export programs 
        of the Department of Agriculture and the Commodity 
        Credit Corporation to help mitigate or offset the 
        effects of the unfair trade practice identified in 
        subsection (a)(2); and
          (2) ascertain and take into account the industry 
        preference for the practical use of available 
        commercial export promotion programs in implementing 
        subsection (a)(1).

SEC. 303. EQUITABLE TREATMENT OF HIGH-VALUE AND VALUE-ADDED UNITED 
                    STATES AGRICULTURAL COMMODITIES.

    In the case of any program, such as that established under 
section 301, operated by the Secretary or the Commodity Credit 
Corporation during the fiscal years 1991 through 1995, for the 
purpose of discouraging unfair trade practices, the Secretary 
shall establish as an objective to expend annually at least 25 
percent of the total funds available (or 25 percent of the 
value of any commodities employed) for program activities 
involving the export sales of high-value agricultural 
commodities and value-added products of United States 
agricultural commodities.

           *       *       *       *       *       *       *


TITLE IV--GENERAL PROVISIONS

           *       *       *       *       *       *       *



SEC. 414. TRADE CONSULTATIONS CONCERNING IMPORTS.

  (a) Consultation Between Agencies.--The Secretary shall 
require consultation between the Administrator of the Service 
and the heads of other appropriate agencies and offices of the 
Department of Agriculture, including the Administrator of the 
Animal and Plant Health Inspection Service, prior to relaxing 
or removing any restriction on the importation of any 
agricultural commodity into the United States.
  (b) Consultation With Trade Representative.--The Secretary 
shall consult with the United States Trade Representative prior 
to relaxing or removing any restriction on the importation of 
any agricultural commodity or a product thereof into the United 
States.
  (c) Monitoring Compliance With Sanitary and Phytosanitary 
Measures.--The Secretary shall monitor the compliance of World 
Trade Organization member countries with the sanitary and 
phytosanitary measures of the Agreement on Agriculture of the 
Uruguay Round of Multilateral Trade Negotiations of the General 
Agreement on Tariffs and Trade. If the Secretary has reason to 
believe that any country may have failed to meet the commitment 
on sanitary and phytosanitary measures under the Agreement in a 
manner that adversely impacts the exports of a United States 
agricultural commodity, the Secretary shall--
          (1) provide such information to the United States 
        Trade Representative of the circumstances surrounding 
        the matter arising under this subsection; and
          (2) with respect to any such circumstances that the 
        Secretary considers to have a continuing adverse effect 
        on United States agricultural exports, report to the 
        Committee on Agriculture, and the Committee on Ways and 
        Means, of the House of Representatives and the 
        Committee on Agriculture, Nutrition, and Forestry, and 
        the Committee on Finance, of the Senate--
                  (A) that a country may have failed to meet 
                the sanitary and phytosanitary commitments; and
                  (B) any notice given by the Secretary to the 
                United States Trade Representative.

SEC. 415. TECHNICAL ASSISTANCE IN TRADE NEGOTIATIONS.

  The Secretary shall provide technical services to the United 
States Trade Representative on matters pertaining to 
agricultural trade and with respect to international 
negotiations on issues related to agricultural trade.

           *       *       *       *       *       *       *


             Section 1123 of the Food Security Act of 1985


       [7 U.S.C. 1736r; P.L. 99-198, as amended by P.L. 104-127]

SEC. 1123. TRADE NEGOTIATIONS POLICY.

   (a) Findings.--Congress finds that--
           (1) on a level playing field, United States 
        producers are the most competitive suppliers of 
        agricultural products in the world;
          (2)  exports  of  United  States  agricultural  
        products  accounted for $54,000,000,000 in 1995, 
        contributing a net $24,000,000,000 to the merchandise 
        trade balance of the United States and supporting 
        approximately 1,000,000 jobs;
           (3) increased agricultural exports are critical to 
        the future of the farm, rural, and overall United 
        States economy, but the opportunities for increased 
        agricultural exports are limited by the unfair 
        subsidies of the competitors of the United States, and 
        a variety of tariff and nontariff barriers to highly 
        competitive United States agricultural products;
           (4) international negotiations can play a key role 
        in breaking down barriers to United States agricultural 
        exports;
           (5) the Uruguay Round Agreement on Agriculture made 
        significant progress in the attainment of increased 
        market access opportunities for United States exports 
        of agricultural products, for the first time--
                   (A) restraining foreign trade-distorting 
                domestic support and export subsidy programs; 
                and
                   (B) developing common rules for the 
                application of sanitary and phytosanitary 
                restrictions;
         that should result in increased exports of United 
        States agricultural products, jobs, and income growth 
        in the United States;
           (6) the Uruguay Round Agreement on Agriculture did 
        not succeed in completely eliminating trade distorting 
        domestic support and export subsidies by--
                   (A) allowing the European Union to continue 
                unreasonable levels of spending on export 
                subsidies; and
                   (B) failing to discipline monopolistic state 
                trading entities, such as the Canadian Wheat 
                Board, that use nontransparent and 
                discriminatory pricing as a hidden de facto 
                export subsidy;
           (7) during the period 1996 through 2002, there will 
        be several opportunities for the United States to 
        negotiate fairer trade in agricultural products, 
        including further negotiations under the World Trade 
        Organization, and steps toward possible free trade 
        agreements of the Americas and Asian-Pacific Economic 
        Cooperation (APEC); and
           (8) the United States should aggressively use these 
        opportunities to achieve more open and fair 
        opportunities for trade in agricultural products.
   (b) Goals of the United States in Agricultural Trade 
Negotiations.--The objectives of the United States with respect 
to future negotiations on agricultural trade include--
           (1) increasing opportunities for United States 
        exports of agricultural products by eliminating tariff 
        and nontariff barriers to trade;
           (2) leveling the playing field for United States 
        producers of agricultural products by limiting per unit 
        domestic production supports to levels that are no 
        greater than those available in the United States;
           (3) ending the practice of export dumping by 
        eliminating all trade distorting export subsidies and 
        disciplining state trading entities so that they do not 
        (except in cases of bona fide food aid) sell in foreign 
        markets at prices below domestic market prices or 
        prices below their full costs of acquiring and 
        delivering agricultural products to the foreign 
        markets; and
           (4) encouraging government policies that avoid 
        price-depressing surpluses.

               2. Export Promotion of Goods and Services


Sections 2303, 2306, and 2312 of the Export Enhancement Act of 1988, as 
                                amended


[15 U.S.C. 4723, 4726, 4732; P.L. 100-418, as amended by P.L. 102-240, 
      P.L. 102-429, P.L. 102-549, P.L. 103-392, and P.L. 106-158]

SEC. 2303. MARKET DEVELOPMENT COOPERATOR PROGRAM.

    (a) Authority of Secretary of Commerce.--In order to 
promote further the exportation of goods and services from the 
United States, the Secretary of Commerce is authorized to 
establish, in the International Trade Administration of the 
Department of Commerce, a Market Development Cooperator 
Program. The purpose of the program is to develop, maintain, 
and expand foreign markets for nonagricultural goods and 
services produced in the United States.
    (b) Implementation of the Program.--The Secretary of 
Commerce shall carry out the Market Development Cooperator 
Program by entering into contracts with--
          (1) nonprofit industry organizations,
          (2) trade associations,
          (3) State departments of trade and their regional 
        associations, including centers for international trade 
        development, and
          (4) private industry firms or groups of firms in 
        cases where no entity described in paragraph (1), (2), 
        or (3) represents that industry,
(in this section referred to as ``cooperators'') to engage in 
activities in order to carry out the purpose of the Market 
Development Cooperator Program set forth in subsection (a). The 
costs of activities under such a contract shall be shared 
equitably among the Department of Commerce, the cooperator 
involved, and, whenever appropriate, foreign businesses. The 
Department of Commerce shall undertake to support direct costs 
of activities under such a contract, and the cooperator shall 
undertake to support indirect costs of such activities. 
Activities under such a contract shall be carried out by the 
cooperator with the approval and assistance of the Secretary.
    (c) Cooperator Partnership Program.--
          (1) In general.--(A) As part of the Market 
        Development Cooperator Program established under 
        subsection (a), the Secretary of Commerce shall 
        establish a partnership program with cooperators under 
        which a cooperator may detail individuals, subject to 
        the approval of the Secretary, to the United States and 
        Foreign Commercial Service for a period of not less 
        than 1 year or more than 2 years to supplement the 
        Commercial Service.
          (B) Any individual detailed to the United States and 
        Foreign Commercial Service under this subsection shall 
        be responsible for such duties as the Secretary may 
        prescribe in order to carry out the purpose of the 
        Market Development Cooperator Program set forth in 
        subsection (a).
          (C) Individuals detailed to the United States and 
        Foreign Commercial Service under this subsection shall 
        not be considered to be employees of the United States 
        for the purposes of any law administered by the Office 
        of Personnel Management, except that the Secretary of 
        State may determine the applicability to such 
        individuals of section 2(f) of the State Department 
        Basic Authorities Act of 1956 (22 U.S.C. 2669(f)) and 
        of any other law administered by the Secretary of State 
        concerning the detail of such individuals abroad.
          (2) Qualifications of participants.--In order to 
        qualify for the program established under this 
        subsection, individuals shall have demonstrated 
        expertise in the international business arena in at 
        least 2 of the following areas: marketing, market 
        research, and computer data bases.
          (3) Expenses of the program.--(A) The cooperator who 
        details an individual to the United States and Foreign 
        Commercial Service under this subsection shall be 
        responsible for that individual's salary and related 
        expenses, including health care, life insurance, and 
        other noncash benefits, if any, normally paid by such 
        cooperator.
          (B) The Secretary of Commerce shall pay 
        transportation and housing costs for each individual 
        participating in the program established under this 
        subsection.
    (d) Budget Act.--Contracts may be entered into under this 
section in a fiscal year only to such extent or in such amounts 
as are provided in appropriations Acts.

SEC. 2306. UNITED STATES AND FOREIGN COMMERCIAL SERVICE PACIFIC RIM 
                    INITIATIVE.

    (a) In General.--In order to encourage the export of United 
States goods and services to Japan, South Korea, and Taiwan, 
the United States and Foreign Commercial Service shall make a 
special effort to--
          (1) identify United States goods and services which 
        are not being exported to the markets of Japan, South 
        Korea, and Taiwan but which could be exported to these 
        markets under competitive market conditions;
          (2) identify and notify United States persons who 
        sell or provide such goods or services of potential 
        opportunities identified under paragraph (1);
          (3) present, periodically, a list of the goods and 
        services identified under paragraph (1), together with 
        a list of any impediments to the export of such goods 
        and services, to appropriate authorities in Japan, 
        South Korea, and Taiwan, with a view toward 
        liberalizing markets to such goods and services;
          (4) facilitate the entrance into such markets by 
        United States persons identified and notified under 
        paragraph (2); and
          (5) monitor and evaluate the results of efforts to 
        increase the sale of goods and services in such 
        markets.
    (b) Reports to the Congress.--The Secretary of Commerce 
shall report periodically to the Congress on activities carried 
out under subsection (a).
    (c) Definition.--As used in this section, the term ``United 
States person'' means--
          (1) a United States citizen; or
          (2) a corporation, partnership, or other association 
        created under the laws of the United States or any 
        State (including the District of Columbia or any 
        commonwealth, territory, or possession of the United 
        States).

SEC. 2312. TRADE PROMOTION COORDINATING COMMITTEE.

    (a) Establishment and Purpose.--The President shall 
establish the Trade Promotion Coordinating Committee (hereafter 
in this section referred to as the ``TPCC''). The purpose of 
the TPCC shall be--
          (1) to provide a unifying framework to coordinate the 
        export promotion and export financing activities of the 
        United States Government; and
          (2) to develop a governmentwide strategic plan for 
        carrying out Federal export promotion and export 
        financing programs.
    (b) Duties.--The TPCC shall--
          (1) coordinate the development of the trade promotion 
        policies and programs of the United States Government;
          (2) provide a central source of information for the 
        business community on Federal export promotion and 
        export financing programs;
          (3) coordinate official trade promotion efforts to 
        ensure better delivery of services to United States 
        businesses, including--
                  (A) information and counseling on United 
                States export promotion and export financing 
                programs and opportunities in foreign markets;
                  (B) representation of United States business 
                interests abroad; and
                  (C) assistance with foreign business contacts 
                and projects;
          (4) prevent unnecessary duplication in Federal export 
        promotion and export financing activities;
          (5) assess the appropriate levels and allocation of 
        resources among agencies in support of export promotion 
        and export financing and provide recommendations to the 
        President based on its assessment; and
          (6) carry out such other duties as are deemed to be 
        appropriate consistent with the purpose of the TPCC.
    (c) Strategic Plan.--To carry out subsection (b), the TPCC 
shall develop and implement a governmentwide strategic plan for 
Federal trade promotion efforts. Such plan shall--
          (1) establish a set of priorities for Federal 
        activities in support of United States exports and 
        explain the rationale for the priorities;
          (2) review current Federal programs designed to 
        promote the sale of United States exports in light of 
        the priorities established under paragraph (1) and 
        develop a plan to bring such activities into line with 
        the priorities and to improve coordination of such 
        activities;
          (3) identify areas of overlap and duplication among 
        Federal export promotion activities and propose means 
        of eliminating them;
          (4) propose to the President an annual unified 
        Federal trade promotion budget that supports the plan 
        for priority activities and improved coordination 
        established under paragraph (2) and eliminates funding 
        for the areas of overlap and duplication identified 
        under paragraph (3); and
          (5) review efforts by the States (as defined in 
        section 2301(i)) to promote United States exports and 
        propose means of developing cooperation between State 
        and Federal efforts, including co-location, cost-
        sharing between Federal and State export promotion 
        programs, and sharing of market research data.
    (d) Membership.--
          (1) In general.--Members of the TPCC shall include 
        representatives from--
                  (A) the Department of Commerce;
                  (B) the Department of State;
                  (C) the Department of the Treasury;
                  (D) the Department of Agriculture;
                  (E) the Department of Energy;
                  (F) the Department of Transportation;
                  (G) the Office of the United States Trade 
                Representative;
                  (H) the Small Business Administration;
                  (I) the Agency for International Development;
                  (J) the Trade and Development Program;
                  (K) the Overseas Private Investment 
                Corporation;
                  (L) the Export-Import Bank of the United 
                States; and
                  (M) at the discretion of the President, such 
                other departments or agencies as may be 
                necessary.
          (2) Chairperson.--The Secretary of Commerce shall 
        serve as the chairperson of the TPCC.
    (e) Member Qualifications.--Members of the TPCC shall be 
appointed by the heads of their respective departments or 
agencies. Such members, as well as alternates designated by any 
members unable to attend a meeting of the TPCC, shall be 
individuals who exercise significant decisionmaking authority 
in their respective departments or agencies.
    (f) Report to the Congress.--The chairperson of the TPCC 
shall prepare and submit to the Committee on Banking, Housing, 
and Urban Affairs of the Senate, and the Committee on Foreign 
Affairs of the House of Representatives, not later than March 
30 of each year, a report describing the strategic plan 
developed by the TPCC pursuant to subsection (c), the 
implementation of such plan, and any revisions thereto.
   Chapter 12: AUTHORITIES RELATING TO POLITICAL OR ECONOMIC SECURITY

            A. ECONOMIC AUTHORITIES IN NATIONAL EMERGENCIES

        International Emergency Economic Powers Act, as amended

[50 U.S.C. 1701, 50 App. 5 note; P.L. 95-223, title I and title II, as 
               amended by P.L. 100-418 and P.L. 103-236]

         TITLE I--AMENDMENTS TO THE TRADING WITH THE ENEMY ACT

 removal of national emergency powers under the trading with the enemy 
act

           *       *       *       *       *       *       *


    Sec. 101. (b) Notwithstanding the amendment made by 
subsection (a), the authorities conferred upon the President by 
section 5(b) of the Trading With the Enemy Act, which were 
being exercised with respect to a country on July 1, 1977, as a 
result of a national emergency declared by the President before 
such date, may continue to be exercised with respect to such 
country, except that, unless extended, the exercise of such 
authorities shall terminate (subject to the savings provisions 
of the second sentence of section 101(a) of the National 
Emergencies Act) at the end of the two-year period beginning on 
the date of enactment of the National Emergencies Act. The 
President may extend the exercise of such authorities for one-
year periods upon a determination of each such extension that 
the exercise of such authorities with respect to such country 
for another year is in the national interest of the United 
States.
    (c) The termination and extension provisions of subsection 
(b) of this section supersede the provisions of section 101(a) 
and of title II of the National Emergencies Act to the extent 
that the provisions of subsection (b) of this section are 
inconsistent with those provisions.

           *       *       *       *       *       *       *


           TITLE II--INTERNATIONAL EMERGENCY ECONOMIC POWERS

                              short title

    Sec. 201. This title may be cited as the ``International 
Emergency Economic Powers Act''.

            situations in which authorities may be exercised

    Sec. 202. (a) Any authority granted to the President by 
section 203 may be exercised to deal with any unusual and 
extraordinary threat, which has its source in whole or 
substantial part outside the United States, to the national 
security, foreign policy, or economy of the United States, if 
the President declares a national emergency with respect to 
such threat.
    (b) The authorities granted to the President by section 203 
may only be exercised to deal with an unusual and extraordinary 
threat with respect to which a national emergency has been 
declared for purposes of this title and may not be exercised 
for any other purpose. Any exercise of such authorities to deal 
with any new threat shall be based on a new declaration of 
national emergency which must be with respect to such threat.

                          grant of authorities

    Sec. 203. (a)(1) At the times and to the extent specified 
in section 202, the President may, under such regulations as he 
may prescribe, by means of instructions, licenses, or 
otherwise--
          (A) investigate, regulate, or prohibit--
                  (i) any transactions in foreign exchange,
                  (ii) transfers of credit or payments between, 
                by, through, or to any banking institution, to 
                the extent that such transfers or payments 
                involve any interest of any foreign country or 
                a national thereof,
                  (iii) the importing or exporting of currency 
                or securities; and
          (B) investigate, regulate, direct and compel, 
        nullify, void, prevent or prohibit, any acquisition, 
        holding, withholding, use, transfer, withdrawal, 
        transportation, importation or exportation of, or 
        dealing in, or exercising any right, power, or 
        privilege with respect to, or transactions involving, 
        any property in which any foreign country or a national 
        thereof has any interest;
by any person, or with respect to any property, subject to the 
jurisdiction of the United States.
    (2) In exercising the authorities granted by paragraph (1), 
the President may require any person to keep a full record of, 
and to furnish under oath, in the form of reports or otherwise, 
complete information relative to any act or transaction 
referred to in paragraph (1) either before, during, or after 
the completion thereof, or relative to any interest in foreign 
property, or relative to any property in which any foreign 
country or any national thereof has or has had any interest, or 
as may be otherwise necessary to enforce the provisions of such 
paragraph. In any case in which a report by a person could be 
required under this paragraph, the President may require the 
production of any books of account, records, contracts, 
letters, memoranda, or other papers, in the custody or control 
of such person.
    (3) Compliance with any regulation, instruction, or 
direction issued under this title shall to the extent thereof 
be a full acquittance and discharge for all purposes of the 
obligation of the person making the same. No person shall be 
held liable in any court for or with respect to anything done 
or omitted in good faith in connection with the administration 
of, or pursuant to and in reliance on, this title, or any 
regulation, instruction, or direction issued under this title.
    (b) The authority granted to the President by this section 
does not include the authority to regulate or prohibit, 
directly or indirectly--
          (1) any postal, telegraphic, telephonic, or other 
        personal communication, which does not involve a 
        transfer of anything of value;
          (2) donations, by persons subject to the jurisdiction 
        of the United States, of articles, such as food, 
        clothing, and medicine, intended to be used to relieve 
        human suffering, except to the extent that the 
        President determines that such donations (A) would 
        seriously impair his ability to deal with any national 
        emergency declared under section 202 of this title, (B) 
        are in response to coercion against the proposed 
        recipient or donor, or (C) would endanger Armed Forces 
        of the United States which are engaged in hostilities 
        or are in a situation where imminent involvement in 
        hostilities is clearly indicated by the circumstances; 
        or
          (3) the importation from any country, or the 
        exportation to any country, whether commercial or 
        otherwise, regardless of format or medium of 
        transmission, of any information or informational 
        materials, including but not limited to, publications, 
        films, posters, phonograph records, photographs, 
        microfilms, microfiche, tapes, compact disks, CD ROMs, 
        artworks, and news wire feeds. The exports exempted 
        from regulation or prohibition by this paragraph do not 
        include those which are otherwise controlled for export 
        under section 5 of the Export Administration Act of 
        1979, or under section 6 of such Act to the extent that 
        such controls promote the nonproliferation or 
        antiterrorism policies of the United States, or with 
        respect to which acts are prohibited by chapter 37 of 
        title 18, United States Code; or
          (4) any transactions ordinarily incident to travel to 
        or from any country, including importation of 
        accompanied baggage for personal use, maintenance 
        within any country including payment of living expenses 
        and acquisition of goods or services for personal use, 
        and arrangement or facilitation of such travel 
        including nonscheduled air, sea, or land voyages.
    [Section 525(c) of P.L. 103-236 provides that paragraph (3) 
as amended applies to actions taken by the President under 
section 203 of such Act before the date of enactment of this 
Act which are in effect on such date, and to actions taken 
under such section on or after such date and that paragraph (4) 
shall not apply to restrictions on the transactions and 
activities described in section 203(b)(4) in force on the date 
of enactment of this Act, with respect to countries embargoed 
under the International Emergency Economic Powers Act on the 
date of enactment of this Act.]

                        consultation and reports

    Sec. 204. (a) The President, in every possible instance, 
shall consult with the Congress before exercising any of the 
authorities granted by this title and shall consult regularly 
with the Congress so long as such authorities are exercised.
    (b) Whenever the President exercises any of the authorities 
granted by this title, he shall immediately transmit to the 
Congress a report specifying--
          (1) the circumstances which necessitate such exercise 
        of authority;
          (2) why the President believes those circumstances 
        constitute an unusual and extraordinary threat, which 
        has its source in whole or substantial part outside the 
        United States, to the national security, foreign 
        policy, or economy of the United States;
          (3) the authorities to be exercised and the actions 
        to be taken in the exercise of those authorities to 
        deal with those circumstances;
          (4) why the President believes such actions are 
        necessary to deal with those circumstances; and
          (5) any foreign countries with respect to which such 
        actions are to be taken and why such actions are to be 
        be taken with respect to those countries.
    (c) At least once during each succeeding six-month period 
after transmitting a report pursuant to subsection (b) with 
respect to an exercise of authorities under this title, the 
President shall report to the Congress with respect to the 
actions taken, since the last such report, in the exercise of 
such authorities, and with respect to any changes which have 
occurred concerning any information previously furnished 
pursuant to paragraphs (1) through (5) of subsection (b).
    (d) The requirements of this section are supplemental to 
those contained in title IV of the National Emergencies Act.

                     authority to issue regulations

    Sec. 205. The President may issue such regulations, 
including regulations prescribing definitions, as may be 
necessary for the exercise of the authorities granted by this 
title.

                               penalties

    Sec. 206. (a) A civil penalty of not to exceed $10,000 may 
be imposed on any person who violates any license, order, or 
regulation issued under this title.
    (b) Whoever willfully violates any license, order, or 
regulation issued under this title shall, upon conviction, be 
fined not more than $50,000, or, if a natural person, may be 
imprisoned for not more than ten years, or both; and any 
officer, director, or agent of any corporation who knowingly 
participates in such violation may be punished by a like fine, 
imprisonment, or both.

                           savings provision

    Sec. 207. (a)(1) Except as provided in subsection (b), 
notwithstanding the termination pursuant to the National 
Emergencies Act of a national emergency declared for purposes 
of this title, any authorities granted by this title, which are 
exercised on the date of such termination on the basis of such 
national emergency to prohibit transactions involving property 
in which a foreign country or national thereof has any 
interest, may continue to be so exercised to prohibit 
transactions involving that property if the President 
determines that the continuation of such prohibition with 
respect to that property is necessary on account of claims 
involving such country or its nationals.
    (2) Notwithstanding the termination of the authorities 
described in section 101(b) of this Act, any such authorities, 
which are exercised with respect to a country on the date of 
such termination to prohibit transactions involving any 
property in which such country or any national thereof has any 
interest, may continue to be exercised to prohibit transactions 
involving that property if the President determines that the 
continuation of such prohibition with respect to that property 
is necessary on account of claims involving such country or its 
nationals.
    (b) The authorities described in subsection (a)(1) may not 
continue to be exercised under this section if the national 
emergency is terminated by the Congress by concurrent 
resolution pursuant to section 202 of the National Emergencies 
Act and if the Congress specifies in such concurrent resolution 
that such authorities may not continue to be exercised under 
this section.
    (c)(1) The provisions of this section are supplemental to 
the savings provisions of paragraphs (1), (2), and (3) of 
section 101(a) and of paragraphs (A), (B), and (C) of section 
202(a) of the National Emergencies Act.
    (2) The provisions of this section superseded the 
termination provisions of section 101(a) and of title II of the 
National Emergencies Act to the extent that the provisions of 
this section are inconsistent with these provisions.
    (d) If the President uses the authority of this section to 
continue prohibitions on transactions involving foreign 
property interests, he shall report to the Congress every six 
months on the use of such authority.
    Sec. 208. If any provision of this Act is held invalid, the 
remainder of the Act shall not be affected thereby.

       Section 5(b) of the Trading With the Enemy Act, as amended


  [50 U.S.C. App. 5(b); P.L. 65-91, as amended by P.L. 65-217, P.L. 73-
1, P.L. 76-69, P.L. 77-354, P.L. 95-223, P.L. 99-93, P.L. 100-418, and 
                             P.L. 103-236]

    Sec. 5. (b)(1) During the time of war the President may, 
through any agency that he may designate, and under such rules 
and regulations as he may prescribe, by means of instructions, 
licenses, or otherwise--
          (A) investigate, regulate, or prohibit, any 
        transactions in foreign exchange, transfers of credit 
        or payments between, by, through, or to any banking 
        institution, and the importing, exporting, hoarding, 
        melting, or earmarking of gold or silver coin or 
        bullion, currency or securities, and
          (B) investigate, regulate, direct and compel, 
        nullify, void, prevent or prohibit, any acquisition 
        holding, withholding, use, transfer, withdrawal, 
        transportation, importation or exportation of, or 
        dealing in, or exercising any right, power, or 
        privilege with respect to, or transactions involving, 
        any property in which any foreign country or a national 
        thereof has any interest,
by any person, or with respect to any property, subject to the 
jurisdiction of the United States; and any property or interest 
of any foreign country or national thereof shall vest, when, 
as, and upon the terms, directed by the President, in such 
agency or person as may be designated from time to time by the 
President, and upon such terms and conditions as the President 
may prescribe such interest or property shall be held, used, 
administered, liquidated, sold, or otherwise dealt with in the 
interest of and for the benefit of the United States, and such 
designated agency or person may perform any and all acts 
incident to the accomplishment or furtherance of these 
purposes; and the President shall, in the manner hereinabove 
provided, require any person to keep a full record of, and to 
furnish under oath, in the form of reports or otherwise, 
complete information relative to any act or transaction 
referred to in this subdivision either before, during, or after 
the completion thereof, or relative to any interest in foreign 
property, or relative to any property in which any foreign 
country or any national thereof has or has had any interest, or 
as may be otherwise necessary to enforce the provisions of this 
subsection, and in any case in which a report could be 
required, the President may, in the manner hereinabove 
provided, require the production, or if necessary to the 
national security or defense, the seizure, of any books of 
account, records, contracts, letters, memoranda, or other 
papers, in the custody or control of such person.
    (2) Any payment, conveyance, transfer, assignment, or 
delivery of property or interest therein, made to or for the 
account of the United States, or as otherwise directed, 
pursuant to this subdivision or any rule, regulation, 
instruction, or direction issued hereunder shall to the extent 
thereof be a full acquittance and discharge for all purposes of 
the obligation of the person making the same; and no person 
shall be held liable in any court for or in respect to anything 
done or omitted in good faith in connection with the 
administration of, or in pursuance of and in reliance on, this 
subdivision, or any rule, regulation, instruction, or direction 
issued hereunder.
    (3) As used in this subdivision the term ``United States'' 
means the United States and any place subject to the 
jurisdiction thereof: Provided, however, That the foregoing 
shall not be construed as a limitation upon the power of the 
President, which is hereby conferred, to prescribe from time to 
time, definitions, not inconsistent with the purposes of this 
subdivision, for any or all of the terms used in this 
subdivision. As used in this subdivision the term ``person'' 
means an individual, partnership, association, or corporation.
    (4) The authority granted to the President in this section 
does not include the authority to regulate or prohibit, 
directly or indirectly, the importation from any country, or 
the exportation to any country, whether commercial or 
otherwise, regardless of format or medium of transmission, of 
any information or informational materials, including but not 
limited to, publications, films, posters, phonograph records, 
photographs, microfilms, microfiche, tapes, compact disks, CD 
ROMs, artworks, and news wire feeds. The exports exempted from 
regulation or prohibition by this paragraph do not include 
those which are otherwise controlled for export under section 5 
of the Export Administration Act of 1979, or under section 6 of 
that Act to the extent that such controls promote the 
nonproliferation or antiterrorism policies of the United 
States, or with respect to which acts are prohibited by chapter 
37 of title 18, United States Code.
    [Section 2502(a)(2) of the Omnibus Trade and 
Competitiveness Act of 1988 and Section 525 (b)(2) of the 
Foreign Relations Authorization Act of 1994 provide with 
respect to paragraph (4) of section 5(b):
    [The authorities conferred upon the President by section 
5(b) of the Trading With the Enemy Act, which were being 
exercised with respect to a country on July 1, 1977, as a 
result of a national emergency declared by the President before 
such date, and are being exercised on the date of the enactment 
of this Act, do not include the authority to regulate or 
prohibit, directly or indirectly, any activity which, under 
section 5(b)(4) of the Trading With the Enemy Act, as added by 
paragraph (1) of this subsection, may not be regulated or 
prohibited.]

 B. TRADE SANCTIONS AGAINST UNCOOPERATIVE MAJOR DRUG PRODUCING OR DRUG-
                           TRANSIT COUNTRIES


                      Narcotics Control Trade Act


           (Title VIII of the Trade Act of 1974, as amended)


[19 U.S.C. 2491 et seq.; P.L. 93-618 as added by P.L. 99-570, title IX, 
and amended by P.L. 100-204, P.L. 100-690, P.L. 101-231, P.L. 102-583, 
                            and P.L. 106-36]

SEC. 801. SHORT TITLE.

    This title may be cited as the ``Narcotics Control Trade 
Act''.

SEC. 802. TARIFF TREATMENT OF PRODUCTS OF UNCOOPERATIVE MAJOR DRUG 
                    PRODUCING OR DRUG-TRANSIT COUNTRIES.

    (a) Required Action by President.--Subject to subsection 
(b), for every major drug producing country and every major 
drug-transit country, the President shall, on or after March 1, 
1987, and March 1 of each succeeding year, to the extent 
considered necessary by the President to achieve the purposes 
of this title--
          (1) deny to any or all of the products of that 
        country tariff treatment under the Generalized System 
        of Preferences, the Caribbean Basin Economic Recovery 
        Act, or any other law providing preferential tariff 
        treatment;
          (2) apply to any or all of the dutiable products of 
        that country an additional duty at a rate not to exceed 
        50 percent ad valorem or the specific rate equivalent;
          (3) apply to one or more duty-free products of that 
        country a duty at a rate not to exceed 50 percent ad 
        valorem;
          (4) take the steps described in subsection (d)(1) or 
        (d)(2), or both, to curtail air transportation between 
        the United States and that country;
          (5) withdraw the personnel and resources of the 
        United States from participation in any arrangement 
        with that country for the pre-clearance of customs by 
        visitors between the United States and that country; or
          (6) take any combination of the actions described in 
        paragraphs (1) through (5).
    (b)(1)(A) Subject to paragraph (3), subsection (a) shall 
not apply with respect to a country if the President determines 
and certifies to the Congress, at the time of the submission of 
the report required by section 489 of the Foreign Assistance 
Act of 1961 (22 U.S.C. 2291h), that--
          (i) during the previous year the country has 
        cooperated fully with the United States, or has taken 
        adequate steps on its own--
                  (I) in satisfying the goals agreed to in an 
                applicable bilateral narcotics agreement with 
                the United States (as described in paragraph 
                (B)) or a multilateral agreement which achieves 
                the objectives of paragraph (B),
                  (II) in preventing narcotic and psychotropic 
                drugs and other controlled substances produced 
                or processed, in whole or in part, in such 
                country or transported through such country, 
                from being sold illegally within the 
                jurisdiction of such country to United States 
                Government personnel or their dependents or 
                from being transported, directly or indirectly, 
                into the United States,
                  (III) in preventing and punishing the 
                laundering in that country of drug-related 
                profits or drug-related moneys, and
                  (IV) in preventing and punishing bribery and 
                other forms of public corruption which 
                facilitate the illicit production, processing, 
                or shipment of narcotic and psychotropic drugs 
                and other controlled substances, or which 
                discourage the investigation and prosecution of 
                such acts; or
          (ii) for a country that would not otherwise qualify 
        for certification under clause (i), the vital national 
        interests of the United States require that subsection 
        (a) not be applied with respect to that country.
    (B) A bilateral narcotics agreement referred to in 
subparagraph (A)(i)(I) is an agreement between the United 
States and a foreign country in which the foreign country 
agrees to take specific activities, including, where 
applicable, efforts to--
          (i) reduce drug production, drug consumption, and 
        drug trafficking within its territory, including 
        activities to address illicit crop eradication and crop 
        substitution;
          (ii) increase drug interdiction and enforcement;
          (iii) increase drug education and treatment programs;
          (iv) increase the identification of and elimination 
        of illicit drug laboratories;
          (v) increase the identification and elimination of 
        the trafficking of essential precursor chemicals for 
        the use in production of illegal drugs;
          (vi) increase cooperation with United States drug 
        enforcement officials; and
          (vii) where applicable, increase participation in 
        extradition treaties, mutual legal assistance 
        provisions directed at money laundering, sharing of 
        evidence, and other initiatives for cooperative drug 
        enforcement.
    (C) A country which in the previous year was designated as 
a major drug producing country or a major drug-transit country 
may not be determined to be cooperating fully under 
subparagraph (A)(i) unless it has in place a bilateral 
narcotics agreement with the United States or a multilateral 
agreement which achieves the objectives of subparagraph (B).
    (D) If the President makes a certification with respect to 
a country pursuant to subparagaph (A)(ii), he shall include in 
such certification--
          (i) a full and complete description of the vital 
        national interests placed at risk if action is taken 
        pursuant to subsection (a) with respect to that 
        country; and
          (ii) a statement weighing the risk described in 
        clause (i) against the risks posed to the vital 
        national interests of the United States by the failure 
        of such country to cooperate fully with the United 
        States in combating narcotics or to take adequate steps 
        to combat narcotics on its own.
    (E) The President may make a certification under 
subparagraph (A)(i) with respect to a major drug producing 
country or drug-transit country which is also a producer of 
licit opium only if the President determines that such country 
has taken steps to prevent significant diversion of its licit 
cultivation and production into the illicit market, maintains 
production and stockpiles at levels no higher than those 
consistent with licit market demand, and prevents illicit 
cultivation and production.
    (2) In determining whether to make the certification 
required by paragraph (1) with respect to a country, the 
President shall consider the following:
          (A) Have the actions of the government of that 
        country resulted in the maximum reductions in illicit 
        drug production which were determined to be achievable 
        pursuant to section 481(e)(4) of the Foreign Assistance 
        Act of 1961.\1\ In the case of a major drug producing 
        country, the President shall give foremost 
        consideration, in determining whether to make the 
        certification required by paragraph (1), to whether the 
        government of that country has taken actions which have 
        resulted in such reductions.
---------------------------------------------------------------------------
    \1\ For successor provisions to section 481(e) of the Foreign 
Assistance Act of 1961 see sections 489 and 490 of the Foreign 
Assistance Act of 1961; 22 U.S.C. 22918, 22 U.S.C. 2291j.
---------------------------------------------------------------------------
          (B) Has that government taken the legal and law 
        enforcement measures to enforce in its territory, to 
        the maximum extent possible, the elimination of illicit 
        cultivation and the suppression of illicit 
        manufacturing of and trafficking in narcotic and 
        psychotropic drugs and other controlled substances, as 
        evidenced by seizures of such drugs and substances and 
        of illicit laboratories and the arrest and prosecution 
        of violators involved in the traffic in such drugs and 
        substances significantly affecting the United States?
          (C) Has that government taken the legal and law 
        enforcement steps necessary to eliminate, to the 
        maximum extent possible, the laundering in that country 
        of drug-related profits or drug-related moneys, as 
        evidenced by--
                  (i) the enactment and enforcement by that 
                government of laws prohibiting such conduct,
                  (ii) that government entering into, and 
                cooperating under the terms of, mutual legal 
                assistance agreements with the United States 
                governing (but not limited to) money 
                laundering, and
                  (iii) the degree to which that government 
                otherwise cooperates with United States law 
                enforcement authorities on anti-money 
                laundering efforts?
          (D) Has that government taken the legal and law 
        enforcement steps necessary to eliminate, to the 
        maximum extent possible, bribery and other forms of 
        public corruption which facilitate the illicit 
        production, processing, or shipment of narcotic and 
        psychotropic drugs and other controlled substances, or 
        which discourage the investigation and prosecution of 
        such acts, as evidenced by the enactment and 
        enforcement of laws prohibiting such conduct?
          (E) Has that government, as a matter of government 
        policy, encouraged or facilitated the production or 
        distribution of illicit narcotic and psychotropic drugs 
        and other controlled substances?
          (F) Does any senior official of that government 
        engage in, encourage, or facilitate the production or 
        distribution of illicit narcotic and psychotropic drugs 
        and other controlled substances?
          (G) Has that government investigated aggressively all 
        cases in which any member of an agency of the United 
        States Government engaged in drug enforcement 
        activities since January 1, 1985, has been the victim 
        of acts or threats of violence, inflicted by or with 
        the complicity of any law enforcement or other officer 
        of such country or any political subdivision thereof, 
        and has energetically sought to bring the perpetrators 
        of such offense or offenses to justice?
          (H) Having been requested to do so by the United 
        States Government, does that government fail to provide 
        reasonable cooperation to lawful activities of United 
        States drug enforcement agents, including the refusal 
        of permission to such agents engaged in interdiction of 
        aerial smuggling into the United States to pursue 
        suspected aerial smugglers a reasonable distance into 
        the airspace of the requested country?
          (I) Has that government made necessary changes in 
        legal codes in order to enable law enforcement 
        officials to move more effectively against narcotics 
        traffickers, such as new conspiracy laws and new asset 
        seizure laws?
          (J) Has that government expeditiously processed 
        United States extradition requests relating to 
        narcotics trafficking?
          (K) Has that government refused to protect or give 
        haven to any known drug traffickers, and has it 
        expeditiously processed extradition requests relating 
        to narcotics trafficking made by other countries?
    (3) Subsection (a) shall apply to a country without regard 
to paragraph (1) of this subsection if the Congress enacts, 
with 45 days of continuous session after receipt of a 
certification under paragraph (1), a joint resolution 
disapproving the determination of the President contained in 
that certification.
    (4) If the President takes action under subsection (a), 
that action shall remain in effect until--
          (A) the President makes the certification under 
        paragraph (a), a period of 45 days of continuous 
        session of Congress elapses, and during that period the 
        Congress does not enact a joint resolution of 
        disapproval; or
          (B) the President submits at any other time a 
        certification of the matters described in paragraph (1) 
        with respect to that country, a period of 45 days of 
        continuous session of Congress elapses, and during that 
        period the Congress does not enact a joint resolution 
        of disapproving determination contained in that 
        certification.
    (5) For the purpose of expediting the consideration and 
enactment of joint resolutions under paragraphs (3) and (4)--
          (A) a motion to proceed to the consideration of any 
        such joint resolution after it has been reported by the 
        Committee on Ways and Means shall be treated as highly 
        privileged in the House of Representatives; and
          (B) a motion to proceed to the consideration of any 
        such joint resolution after it has been reported by the 
        Committee on Finance shall be treated as privileged in 
        the Senate.
    (c) Duration of Action.--The action taken by the President 
under paragraph (1), (2), or (3) of subsection (a) shall apply 
to the products of a foreign country that are entered, or 
withdrawn from warehouse for consumption, during the period 
that such action is in effect.
    (d) Presidential Action Regarding Aviation.--
          (1)(A) The President is authorized to notify the 
        government of a country against which is imposed the 
        sanction described in subsection (a)(4) of his 
        intention to suspend the authority of foreign air 
        carriers owned or controlled by the government or 
        nationals of that country to engage in foreign air 
        transportation to or from the United States.
          (B) Within 10 days after the date of notification of 
        a government under subparagraph (a), the Secretary of 
        Transportation shall take all steps necessary to 
        suspend at the earliest possible date the authority of 
        any foreign air carrier owned or controlled, directly 
        or indirectly, by the government or nationals of that 
        country to engage in foreign air transportation to or 
        from the United States, notwithstanding any agreement 
        relating to air services.
          (C) The President may also direct the Secretary of 
        Transportation to take such steps as may be necessary 
        to suspend the authority of any air carrier to engage 
        in foreign air transportation between the United States 
        and that country.
          (2)(A) The President may direct the Secretary of 
        State to terminate any air service agreement between 
        the United States and a country against which the 
        sanction described in subsection (a)(4) is imposed in 
        accordance with the provisions of that agreement.
          (B) Upon termination of an agreement under this 
        paragraph, the Secretary of Transportation shall take 
        such steps as may be necessary to revoke at the 
        earliest possible date the right of any foreign air 
        carrier owned, or controlled, directly or indirectly, 
        by the government or nationals of that country to 
        engage in foreign air transportation to or from the 
        United States.
          (C) Upon termination of an agreement under this 
        paragraph, the Secretary of Transportation may also 
        revoke the authority of any air carrier to engage in 
        foreign air transportation between the United States 
        and that country.
          (3) The Secretary of Transportation may provide for 
        such exceptions from paragraphs (1) and (2) as the 
        Secretary considers necessary to provide for 
        emergencies in which the safety of an aircraft or its 
        crew or passengers is threatened.
          (4) For purposes of this subsection, the term ``air 
        transportation'', ``air carrier'', ``foreign air 
        carrier'' and ``foreign air transportation'' have the 
        meanings such terms have under section 101 of the 
        Federal Aviation Act of 1958 (49 U.S.C. App. 1301).
    (e) For each calendar year, the Secretary of State, after 
consultation with the appropriate committees of the Congress, 
shall establish numerical standards and other guidelines for 
determining which countries will be considered to be major 
drug-transit countries under section 805(3) (A) and (B).

SEC. 803. SUGAR QUOTA.

    Notwithstanding any other provision of law, the President 
may not allocate any limitation imposed on the quantity of 
sugar to any country which has a Government involved in the 
trade of illicit narcotics or is failing to cooperate with the 
United States in narcotics enforcement activities as defined in 
section 802(b) as determined by the President.

SEC. 804. PROGRESS REPORTS.

    The President shall include as a part of the annual report 
required under section 489 of the Foreign Assistance Act of 
1961 (22 U.S.C. 2291(h)) an evaluation of progress that each 
major drug producing country and each major drug-transit 
country has made during the reporting period in achieving the 
objectives set forth in section 802(b).

SEC. 805. DEFINITIONS.

    For purposes of this title--
          (1) continuity of a session of Congress is broken 
        only by an adjournment of the Congress sine die, and 
        the days on which either House is not in session 
        because of an adjournment of more than three days to a 
        day certain are excluded in the computation of the 
        period indicated;
          (2) the term ``major drug producing country'' means a 
        country that illicitly produces during a fiscal year 
        five metric tons or more of opium or opium derivative, 
        five hundred metric tons or more of coca, or five 
        hundred metric tons or more of marijuana;
          (3) the term ``major drug-transit country'' means a 
        country--
                  (A) that is a significant direct source of 
                illicit narcotic or psychotropic drugs or other 
                controlled substances significantly affecting 
                the United States;
                  (B) through which are transported such drugs 
                or substances; or
                  (C) through which significant sums of drug-
                related profits or monies are laundered with 
                the knowledge or complicity of the government; 
                and
          (4) the term ``narcotic and psychotropic drugs and 
        other controlled substances'' has the same meaning as 
        is given by any applicable international narcotics 
        control agreement or domestic law of the country or 
        countries concerned.

    C. ECONOMIC SANCTIONS AGAINST TERRORISM OR MISSILE PROLIFERATION


  Sections 504 and 505 of the International Security and Development 
                        Cooperation Act of 1985


                [22 U.S.C. 2349 aa-8, aa-9; P.L. 99-83]

SEC. 504. PROHIBITION ON IMPORTS FROM AND EXPORTS TO LIBYA.

    (a) Prohibition on Imports.--Notwithstanding any other 
provision of law, the President may prohibit any article grown, 
produced, extracted, or manufactured in Libya from being 
imported into the United States.
    (b) Prohibition on Exports.--Notwithstanding any other 
provision of law, the President may prohibit any goods or 
technology, including technical data or other information, 
subject to the jurisdiction of the United States or exported by 
any person subject to the jurisdiction of the United States, 
from being exported to Libya.
    (c) Definition.--For purposes of this section, the term 
``United States'', when used in a geographical sense, includes 
territories and possessions of the United States.

SEC. 505. BAN ON IMPORTING GOODS AND SERVICES FROM COUNTRIES SUPPORTING 
                    TERRORISM.

    (a) Authority.--The President may ban the importation into 
the United States of any good or service from any country which 
supports terrorism or terrorist organizations or harbors 
terrorists or terrorist organizations.
    (b) Consultation.--The President, in every possible 
instance, shall consult with the Congress before exercising the 
authority granted by this section and shall consult regularly 
with the Congress so long as that authority is being exercised.
    (c) Reports.--Whenever the President exercises the 
authority granted by this section, he shall immediately 
transmit to the Congress a report specifying--
          (1) the country with respect to which the authority 
        is to be exercised and the imports to be prohibited;
          (2) the circumstances which necessitate the exercise 
        of such authority;
          (3) why the President believes those circumstances 
        justify the exercise of such authority; and
          (4) why the President believes the prohibitions are 
        necessary to deal with those circumstances.
At least once during each succeeding 6-month period after 
transmitting a report pursuant to this subsection, the 
President shall report to the Congress with respect to the 
actions taken, since the last such report, pursuant to this 
section and with respect to any changes which have occurred 
concerning any information previously furnished pursuant to 
this subsection.
    (d) Definition.--For purposes of this section, the term 
``United States'' includes territories and possessions of the 
United States.

               Section 73 of the Arms Export Control Act


 [22 U.S.C. 2797b; P.L. 90-629, added by P.L. 101-510, and amended by 
 P.L. 102-138, P.L. 103-236, P.L. 104-106, P.L. 105-277, and P.L. 106-
                                  113]

SEC. 73. TRANSFERS OF MISSILE EQUIPMENT OR TECHNOLOGY BY FOREIGN 
                    PERSONS.

  (a) Sanctions.--(1) Subject to subsections (c) through (g), 
if the President determines that a foreign person, after the 
date of the enactment of this chapter, (enacted November 5, 
1990) knowingly--
          (A) exports, transfers, or otherwise engages in the 
        trade of any MTCR equipment or technology that 
        contributes to the acquisition, design, development, or 
        production of missiles in a country that is not an MTCR 
        adherent and would be, if it were United States-origin 
        equipment or technology, subject to the jurisdiction of 
        the United States under this Act,
          (B) conspires to or attempts to engage in such 
        export, transfer, or trade, or
          (C) facilitates such export, transfer, or trade by 
        any other person,
 or if the President has made a determination with respect to a 
foreign person under section 11B(b)(1) of the Export 
Administration Act of 1979, then the President shall impose on 
that foreign person the applicable sanctions under paragraph 
(2).
  (2) The sanctions which apply to a foreign person under 
paragraph (1) are the following:
          (A) If the item involved in the export, transfer, or 
        trade is within category II of the MTCR Annex, then the 
        President shall deny, for a period of 2 years--
                  (i) United States Government contracts 
                relating to missile equipment or technology; 
                and
                  (ii) licenses for the transfer to such 
                foreign person of missile equipment or 
                technology controlled under this Act.
          (B) If the item involved in the export, transfer, or 
        trade is within category I of the MTCR Annex, then the 
        President shall deny, for a period of not less than 2 
        years--
                  (i) all United States Government contracts 
                with such foreign person; and
                  (ii) licenses for the transfer to such 
                foreign person of all items on the United 
                States Munitions List.
          (C) If, in addition to actions taken under 
        subparagraphs (A) and (B), the President determines 
        that the export, transfer, or trade has substantially 
        contributed to the design, development, or production 
        of missiles in a country that is not an MTCR adherent, 
        then the President shall prohibit, for a period of not 
        less than 2 years, the importation into the United 
        States of products produced by that foreign person.
  (b) Inapplicability With Respect to MTCR Adherents.--
    (1) In General.--Except as provided in paragraph (2), 
Subsection (a) does not apply to--
          (A) any export, transfer, or trading activity that is 
        authorized by the laws of an MTCR adherent, if such 
        authorization is not obtained by misrepresentation or 
        fraud; or
          (B) any export, transfer, or trade of an item to an 
        end user in a country that is an MTCR adherent.
    (2) Limitation.--Notwithstanding paragraph (1), Subsection 
(a) shall apply to an entity subordinate to a government that 
engages in exports or transfers described in section 
498(b)(3)(A) of the Foreign Assistance Act of 1961.
  (c) Effect of Enforcement Actions by MTCR Adherents.--
Sanctions set forth in subsection (a) may not be imposed under 
this section on a person with respect to acts described in such 
subsection or, if such sanctions are in effect against a person 
on account of such acts, such sanctions shall be terminated, if 
an MTCR adherent is taking judicial or other enforcement action 
against that person with respect to such acts, or that person 
has been found by the government of an MTCR adherent to be 
innocent of wrongdoing with respect to such acts, and if the 
President certifies to the Committee on Foreign Relations of 
the Senate and the Committee on International Relations of the 
House of Representatives that--
    (1) for any judicial or other enforcement action taken by 
the MTCR adherent, such action has--
          (A) been comprehensive; and
          (B) been performed to the satisfaction of the United 
        States; and
    (2) with respect to any finding of innocence of wrongdoing, 
the United States is satisfied with the basis for such finding.
  (d) Advisory Opinions.--The Secretary of State, in 
consultation with the Secretary of Defense, the Secretary of 
Commerce, may, upon the request of any person, issue an 
advisory opinion to that person as to whether a proposed 
activity by that person would subject that person to sanctions 
under this section. Any person who relies in good faith on such 
an advisory opinion which states that the proposed activity 
would not subject a person to such sanctions, and any person 
who thereafter engages in such activity, may not be made 
subject to such sanctions on account of such activity.
  (e) Waiver and Report to Congress.--(1) In any case other 
than one in which an advisory opinion has been issued under 
subsection (d) stating that a proposed activity would not 
subject a person to sanctions under this section, the President 
may waive the application of subsection (a) to a foreign person 
if the President determines that such waiver is essential to 
the national security of the United States.
  (2) In the event that the President decides to apply the 
waiver described in paragraph (1), the President shall so 
notify the Committee on Armed Services and the Committee on 
Foreign Relations of the Senate and the Committee on National 
Security (Committee on Armed Services) and the Committee on 
International Relations of the House of Representatives not 
less than 45 working days before issuing the waiver. Such 
notification shall include a report fully articulating the 
rationale and circumstances which led the President to apply 
the waiver.
  (f) Presumption.--In determining whether to apply sanctions 
under subsection (a) to a foreign person involved in the 
export, transfer, or trade of an item on the MTCR Annex, it 
should be a rebuttable presumption that such item is designed 
for use in a missile listed in the MTCR Annex if the President 
determines that the final destination of the item is a country 
the government of which the Secretary of State has determined, 
for purposes of 6(j)(1)(A) of the Export Administration Act of 
1979, has repeatedly provided support for acts of international 
terrorism.
  (g) Additional Waiver.--The President may waive the 
imposition of sanctions under paragraph (1) on a person with 
respect to a product or service if the President certifies to 
the Congress that--
          (1) the product or service is essential to the 
        national security of the United States; and
          (2) such person is a sole source supplier of the 
        product or service, the product or service is not 
        available from any alternative reliable supplier, and 
        the need for the product or service cannot be met in a 
        timely manner by improved manufacturing processes or 
        technological developments.
  (h) Exceptions.--The President shall not apply the sanction 
under this section prohibiting the importation of the products 
of a foreign person--
          (1) in the case of procurement of defense articles or 
        defense services--
                  (A) under existing contracts or subcontracts, 
                including the exercise of options for 
                production quantities to satisfy requirements 
                essential to the national security of the 
                United States;
                  (B) if the President determines that the 
                person to which the sanctions would be applied 
                is a sole source supplier of the defense 
                articles and services, that the defense 
                articles or services are essential to the 
                national security of the United States, and 
                that alternative sources are not readily or 
                reasonably available; or
                  (C) if the President determines that such 
                articles or services are essential to the 
                national security of the United States under 
                defense coproduction agreements or NATO 
                Programs of Cooperation;
          (2) to products or services provided under contracts 
        entered into before the date on which the President 
        publishes his intention to impose the sanctions; or
          (3) to--
                  (A) spare parts,
                  (B) component parts, but not finished 
                products, essential to United States products 
                or production,
                  (C) routine services and maintenance of 
                products, to the extent that alternative 
                sources are not readily or reasonably 
                available, or
                  (D) information and technology essential to 
                United States products or production.

     D. ECONOMIC SANCTIONS AGAINST CHEMICAL AND BIOLOGICAL WEAPONS


Chemical and Biological Weapons Control and Warfare Elimination Act of 
                                  1991


               [22 U.S.C. 5601; P.L. 102-182, title III]

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Chemical and Biological 
Weapons Control and Warfare Elimination Act of 1991''.

SEC. 302. PURPOSES.

    The purposes of this title are--
          (1) to mandate United States sanctions, and to 
        encourage international sanctions, against countries 
        that use chemical or biological weapons in violation of 
        international law or use lethal chemical or biological 
        weapons against their own nationals, and to impose 
        sanctions against companies that aid in the 
        proliferation of chemical and biological weapons;
          (2) to support multilaterally coordinated efforts to 
        control the proliferation of chemical and biological 
        weapons;
          (3) to urge continued close cooperation with the 
        Australia Group and cooperation with other supplier 
        nations to devise ever more effective controls on the 
        transfer of materials, equipment, and technology 
        applicable to chemical or biological weapons 
        production; and
          (4) to require Presidential reports on efforts that 
        threaten United States interests or regional stability 
        by Iran, Iraq, Syria, Libya, and others to acquire the 
        materials and technology to develop, produce, 
        stockpile, deliver, transfer, or use chemical or 
        biological weapons.

SEC. 303. MULTILATERAL EFFORTS.

    (a) Multilateral Controls on Proliferation.--It is the 
policy of the United States to seek multilaterally coordinated 
efforts with other countries to control the proliferation of 
chemical and biological weapons. In furtherance of this policy, 
the United States shall--
          (1) promote agreements banning the transfer of 
        missiles suitable for armament with chemical or 
        biological warheads;
          (2) set as a top priority the early conclusion of a 
        comprehensive global agreement banning the use, 
        development, production, and stockpiling of chemical 
        weapons;
          (3) seek and support effective international means of 
        monitoring and reporting regularly on commerce in 
        equipment, materials, and technology applicable to the 
        attainment of a chemical or biological weapons 
        capability; and
          (4) pursue and give full support to multilateral 
        sanctions pursuant to United Nations Security Council 
        Resolution 620, which declared the intention of the 
        Security Council to give immediate consideration to 
        imposing ``appropriate and effective'' sanctions 
        against any country which uses chemical weapons in 
        violation of international law.
    (b) Multilateral Controls on Chemical Agents, Precursors, 
and Equipment.--It is also the policy of the United States to 
strengthen efforts to control chemical agents, precursors, and 
equipment by taking all appropriate multilateral diplomatic 
measures--
          (1) to continue to seek a verifiable global ban on 
        chemical weapons at the 40 nation Conference on 
        Disarmament in Geneva;
          (2) to support the Australia Group's objective to 
        support the norms and restraints against the spread and 
        the use of chemical warfare, to advance the negotiation 
        of a comprehensive ban on chemical warfare by taking 
        appropriate measures, and to protect the Australia 
        Group's domestic industries against inadvertent 
        association with supply of feedstock chemical equipment 
        that could be misused to produce chemical weapons;
          (3) to implement paragraph (2) by proposing steps 
        complementary to, and not mutually exclusive of, 
        existing multilateral efforts seeking a verifiable ban 
        on chemical weapons, such as the establishment of--
                  (A) a harmonized list of export control rules 
                and regulations to prevent relative commercial 
                advantage and disadvantages accruing to 
                Australia Group members,
                  (B) liaison officers to the Australia Group's 
                coordinating entity from within the diplomatic 
                missions,
                  (C) a close working relationship between the 
                Australia Group and industry,
                  (D) a public unclassified warning list of 
                controlled chemical agents, precursors, and 
                equipment,
                  (E) information-exchange channels of 
                suspected proliferants,
                  (F) a ``denial'' list of firms and 
                individuals who violate the Australia Group's 
                export control provisions, and
                  (G) broader cooperation between the Australia 
                Group and other countries whose political 
                commitment to stem the proliferation of 
                chemical weapons is similar to that of the 
                Australia Group; and
          (4) to adopt the imposition of stricter controls on 
        the export of chemical agents, precursors, and 
        equipment and to adopt tougher multilateral sanctions 
        against firms and individuals who violate these 
        controls or against countries that use chemical 
        weapons.

SEC. 304. UNITED STATES EXPORT CONTROLS.

    (a) In General.--The President shall--
          (1) use the authorities of the Arms Export Control 
        Act to control the export of those defense articles and 
        defense services, and
          (2) use the authorities of the Export Administration 
        Act of 1979 to control the export of those goods and 
        technology,
that the President determines would assist the government of 
any foreign country in acquiring the capability to develop, 
produce, stockpile, deliver, or use chemical or biological 
weapons.
    [(b) Amendments to section 6 of the Export Administration 
Act of 1979.]

[SEC. 305. SANCTIONS AGAINST CERTAIN FOREIGN PERSONS.

    Section 11C added to the Export Administration Act of 1979; 
chapter 8 added to the Arms Export Control Act.]

SEC. 306. DETERMINATIONS REGARDING USE OF CHEMICAL OR BIOLOGICAL 
                    WEAPONS.

    (a) Determination by the President.--
          (1) When determination required; nature of 
        determination.--Whenever persuasive information becomes 
        available to the executive branch indicating the 
        substantial possibility that, on or after the date of 
        the enactment of this title, the government of a 
        foreign country has made substantial preparation to use 
        or has used chemical or biological weapons, the 
        President shall, within 60 days after the receipt of 
        such information by the executive branch, determine 
        whether that government, on or after such date of 
        enactment, has used chemical or biological weapons in 
        violation of international law or has used lethal 
        chemical or biological weapons against its own 
        nationals. Section 307 applies if the President 
        determines that that government has so used chemical or 
        biological weapons.
          (2) Matters to be considered.--In making the 
        determination under paragraph (1), the President shall 
        consider the following:
                  (A) All physical and circumstantial evidence 
                available bearing on the possible use of such 
                weapons.
                  (B) All information provided by alleged 
                victims, witnesses, and independent observers.
                  (C) The extent of the availability of the 
                weapons in question to the purported user.
                  (D) All official and unofficial statements 
                bearing on the possible use of such weapons.
                  (E) Whether, and to what extent, the 
                government in question is willing to honor a 
                request from the Secretary General of the 
                United Nations to grant timely access to a 
                United Nations fact-finding team to investigate 
                the possibility of chemical or biological 
                weapons use or to grant such access to other 
                legitimate outside parties.
          (3) Determination to be reported to congress.--Upon 
        making a determination under paragraph (1), the 
        President shall promptly report that determination to 
        the Congress. If the determination is that a foreign 
        government had used chemical or biological weapons as 
        described in that paragraph, the report shall specify 
        the sanctions to be imposed pursuant to section 307.
    (b) Congressional Requests; Report.--
          (1) Request.--The Chairman of the Committee on 
        Foreign Relations of the Senate (upon consultation with 
        the ranking minority member of such committee) or the 
        Chairman of the Committee on Foreign Affairs of the 
        House of Representatives (upon consultation with the 
        ranking minority member of such committee) may at any 
        time request the President to consider whether a 
        particular foreign government, on or after the date of 
        the enactment of this title, has used chemical or 
        biological weapons in violation of international law or 
        has used lethal chemical or biological weapons against 
        its own nationals.
          (2) Report to congress.--Not later than 60 days after 
        receiving such a request, the President shall provide 
        to the Chairman of the Committee on Foreign Relations 
        of the Senate and the Chairman of the Committee on 
        Foreign Affairs of the House of Representatives a 
        written report on the information held by the executive 
        branch which is pertinent to the issue of whether the 
        specified government, on or after the date of the 
        enactment of this title, has used lethal chemical or 
        biological weapons in violation of international law or 
        has used lethal chemical or biological weapons against 
        its own nationals. This report shall contain an 
        analysis of each of the items enumerated in subsection 
        (a)(2).

SEC. 307. SANCTIONS AGAINST USE OF CHEMICAL OR BIOLOGICAL WEAPONS.

    (a) Initial Sanctions.--If, at any time, the President 
makes a determination pursuant to section 306(a)(1) with 
respect to the government of a foreign country, the President 
shall forthwith impose the following sanctions:
          (1) Foreign assistance.--The United States Government 
        shall terminate assistance to that country under the 
        Foreign Assistance Act of 1961, except for urgent 
        humanitarian assistance and food or other agricultural 
        commodities or products.
          (2) Arms sales.--The United States Government shall 
        terminate--
                  (A) sales to that country under the Arms 
                Export Control Act of any defense articles, 
                defense services, or design and construction 
                services, and
                  (B) licenses for the export to that country 
                of any item on the United States Munitions 
                List.
          (3) Arms sales financing.--The United States 
        Government shall terminate all foreign military 
        financing for that country under the Arms Export 
        Control Act.
          (4) Denial of united states government credit or 
        other financial assistance.--The United States 
        Government shall deny to that country any credit, 
        credit guarantees, or other financial assistance by any 
        department, agency, or instrumentality of the United 
        States Government, including the Export-Import Bank of 
        the United States.
          (5) Exports of national security-sensitive goods and 
        technology.--The authorities of section 6 of the Export 
        Administration Act of 1979 (50 U.S.C. 2405) shall be 
        used to prohibit the export to that country of any 
        goods or technology on that part of the control list 
        established under section 5(c)(1) of that Act (22 
        U.S.C. 2404(c)(1)).
    (b) Additional Sanctions if Certain Conditions Not Met.--
          (1) Presidential determination.--Unless, within 3 
        months after making a determination pursuant to section 
        306(a)(1) with respect to a foreign government, the 
        President determines and certifies in writing to the 
        Congress that--
                  (A) that government is no longer using 
                chemical or biological weapons in violation of 
                international law or using lethal chemical or 
                biological weapons against its own nationals,
                  (B) that government has provided reliable 
                assurances that it will not in the future 
                engage in any such activities, and
                  (C) that government is willing to allow on-
                site inspections by United Nations observers or 
                other internationally recognized, impartial 
                observers, or other reliable means exist, to 
                ensure that that government is not using 
                chemical or biological weapons in violation of 
                international law and is not using lethal 
                chemical or biological weapons against its own 
                nationals,
        then the President, after consultation with the 
        Congress, shall impose on that country the sanctions 
        set forth in at least 3 of subparagraphs (A) through 
        (F) of paragraph (2).
          (2) Sanctions.--The sanctions referred to in 
        paragraph (1) are the following:
                  (A) Multilateral development bank 
                assistance.--The United States Government shall 
                oppose, in accordance with section 701 of the 
                International Financial Institutions Act (22 
                U.S.C. 262d), the extension of any loan or 
                financial or technical assistance to that 
                country by international financial 
                institutions.
                  (B) Bank loans.--The United States Government 
                shall prohibit any United States bank from 
                making any loan or providing any credit to the 
                government of that country, except for loans or 
                credits for the purpose of purchasing food or 
                other agricultural commodities or products.
                  (C) Further export restrictions.--The 
                authorities of section 6 of the Export 
                Administration Act of 1979 shall be used to 
                prohibit exports to that country of all other 
                goods and technology (excluding food and other 
                agricultural commodities and products).
                  (D) Import restrictions.--Restrictions shall 
                be imposed on the importation into the United 
                States of articles (which may include petroleum 
                or any petroleum product) that are the growth, 
                product, or manufacture of that country.
                  (E) Diplomatic relations.--The President 
                shall use his constitutional authorities to 
                downgrade or suspend diplomatic relations 
                between the United States and the government of 
                that country.
                  (F) Presidential action regarding aviation.--
                (i)(I) The President is authorized to notify 
                the government of a country with respect to 
                which the President has made a determination 
                pursuant to section 306(a)(1) of his intention 
                to suspend the authority of foreign air 
                carriers owned or controlled by the government 
                of that country to engage in foreign air 
                transportation to or from the United States.
                  (II) Within 10 days after the date of 
                notification of a government under subclause 
                (I), the Secretary of Transportation shall take 
                all steps necessary to suspend at the earliest 
                possible date the authority of any foreign air 
                carrier owned or controlled, directly or 
                indirectly, by that government to engage in 
                foreign air transportation to or from the 
                United States, notwithstanding any agreement 
                relating to air services.
                  (ii)(I) The President may direct the 
                Secretary of State to terminate any air service 
                agreement between the United States and a 
                country with respect to which the President has 
                made a determination pursuant to section 
                306(a)(1), in accordance with the provisions of 
                that agreement.
                  (II) Upon termination of an agreement under 
                this clause, the Secretary of Transportation 
                shall take such steps as may be necessary to 
                revoke at the earliest possible date the right 
                of any foreign air carrier owned, or 
                controlled, directly or indirectly, by the 
                government of that country to engage in foreign 
                air transportation to or from the United 
                States.
                  (iii) The Secretary of Transportation may 
                provide for such exceptions from clauses (i) 
                and (ii) as the Secretary considers necessary 
                to provide for emergencies in which the safety 
                of an aircraft or its crew or passengers is 
                threatened.
                  (iv) For purposes of this subparagraph, the 
                terms ``air transportation'', ``air carrier'', 
                ``foreign air carrier'', and ``foreign air 
                transportation'' have the meanings such terms 
                have under section 101 of the Federal Aviation 
                Act of 1958 (49 U.S.C. App. 1301).
    (c) Removal of Sanctions.--The President shall remove the 
sanctions imposed with respect to a country pursuant to this 
section if the President determines and so certifies to the 
Congress after the end of the 12-month period beginning on the 
date on which sanctions were initially imposed on that country 
pursuant to subsection (a), that--
          (1) the government of that country has provided 
        reliable assurances that it will not use chemical or 
        biological weapons in violation of international law 
        and will not use lethal chemical or biological weapons 
        against its own nationals;
          (2) that government is not making preparations to use 
        chemical or biological weapons in violation of 
        international law or to use lethal chemical or 
        biological weapons against its own nationals;
          (3) that government is willing to allow on-site 
        inspections by United Nations observers or other 
        internationally recognized, impartial observers to 
        verify that it is not making preparations to use 
        chemical or biological weapons in violation of 
        international law or to use lethal chemical or 
        biological weapons against its own nationals, or other 
        reliable means exist to verify that it is not making 
        such preparations; and
          (4) that government is making restitution to those 
        affected by any use of chemical or biological weapons 
        in violation of international law or by any use of 
        lethal chemical or biological weapons against its own 
        nationals.
    (d) Waiver.--
          (1) Criteria for waiver.--The President may waive the 
        application of any sanction imposed with respect to a 
        country pursuant to this section--
                  (A) if--
                          (i) in the case of any sanction other 
                        than a sanction specified in subsection 
                        (b)(2)(D) (relating to import 
                        restrictions) or (b)(2)(E) (relating to 
                        the downgrading or suspension of 
                        diplomatic relations), the President 
                        determines and certifies to the 
                        Congress that such waiver is essential 
                        to the national security interests of 
                        the United States, and if the President 
                        notifies the Committee on Foreign 
                        Relations of the Senate and the 
                        Committee on Foreign Affairs of the 
                        House of Representatives of his 
                        determination and certification at 
                        least 15 days before the waiver takes 
                        effect, in accordance with the 
                        procedures applicable to reprogramming 
                        notifications under section 634A of the 
                        Foreign Assistance Act of 1961, or
                          (ii) in the case of any sanction 
                        specified in subsection (b)(2)(D) 
                        (relating to import restrictions), the 
                        President determines and certifies to 
                        the Congress that such waiver is 
                        essential to the national security 
                        interest of the United States, and if 
                        the President notifies the Committee on 
                        Finance of the Senate and the Committee 
                        on Ways and Means of the House of 
                        Representatives of his determination 
                        and certification at least 15 days 
                        before the waiver takes effect; or
                  (B) if the President determines and certifies 
                to the Congress that there has been a 
                fundamental change in the leadership and 
                policies of the government of that country, and 
                if the President notifies the Congress at least 
                20 days before the waiver takes effect.
          (2) Report.--In the event that the President decides 
        to exercise the waiver authority provided in paragraph 
        (1) with respect to a country, the President's 
        notification to the Congress under such paragraph shall 
        include a report fully articulating the rationale and 
        circumstances which led the President to exercise that 
        waiver authority, including a description of the steps 
        which the government of that country has taken to 
        satisfy the conditions set forth in paragraphs (1) 
        through (4) of subsection (c).
    (e) Contract Sanctity.--
          (1) Sanctions not applied to existing contracts.--(A) 
        A sanction described in paragraph (4) or (5) of 
        subsection (a) or in any of subparagraphs (A) through 
        (D) of subsection (b)(2) shall not apply to any 
        activity pursuant to any contract or international 
        agreement entered into before the date of the 
        presidential determination under section 306(a)(1) 
        unless the President determines, on a case-by-case 
        basis, that to apply such sanction to that activity 
        would prevent the performance of a contract or 
        agreement that would have the effect of assisting a 
        country in using chemical or biological weapons in 
        violation of international law or in using lethal 
        chemical or biological weapons against its own 
        nationals.
          (B) The same restrictions of subsection (p) of 
        section 6 of the Export Administration Act of 1979 (50 
        U.S.C. App. 2405), as that subsection is so 
        redesignated by section 304(b) of this title, which are 
        applicable to exports prohibited under section 6 of 
        that Act shall apply to exports prohibited under 
        subsection (a)(5) or (b)(2)(C) of this section. For 
        purposes of this subparagraph, any contract or 
        agreement the performance of which (as determined by 
        the President) would have the effect of assisting a 
        foreign government in using chemical or biological 
        weapons in violation of international law or in using 
        lethal chemical or biological weapons against its own 
        nationals shall be treated as constituting a breach of 
        the peace that poses a serious and direct threat to the 
        strategic interest of the United States, within the 
        meaning of subparagraph (A) of section 6(p) of that 
        Act.
          (2) Sanctions applied to existing contracts.--The 
        sanctions described in paragraphs (1), (2), and (3) of 
        subsection (a) shall apply to contracts, agreements, 
        and licenses without regard to the date the contract or 
        agreement was entered into or the license was issued 
        (as the case may be), except that such sanctions shall 
        not apply to any contract or agreement entered into or 
        license issued before the date of the presidential 
        determination under section 306(a)(1) if the President 
        determines that the application of such sanction would 
        be detrimental to the national security interests of 
        the United States.

SEC. 308. PRESIDENTIAL REPORTING REQUIREMENTS.

    (a) Reports to Congress.--Not later than 90 days after the 
date of the enactment of this title, and every 12 months 
thereafter, the President shall transmit to the Congress a 
report which shall include--
          (1) a description of the actions taken to carry out 
        this title, including the amendments made by this 
        title;
          (2) a description of the current efforts of foreign 
        countries and subnational groups to acquire equipment, 
        materials, or technology to develop, produce, or use 
        chemical or biological weapons, together with an 
        assessment of the current and likely future 
        capabilities of such countries and groups to develop, 
        produce, stockpile, deliver, transfer, or use such 
        weapons;
          (3) a description of--
                  (A) the use of chemical weapons by foreign 
                countries in violation of international law,
                  (B) the use of chemical weapons by 
                subnational groups,
                  (C) substantial preparations by foreign 
                countries and subnational groups to do so, and
                  (D) the development, production, stockpiling, 
                or use of biological weapons by foreign 
                countries and subnational groups; and
          (4) a description of the extent to which foreign 
        persons or governments have knowingly and materially 
        assisted third countries or subnational groups to 
        acquire equipment, material, or technology intended to 
        develop, produce, or use chemical or biological 
        weapons.
    (b) Protection of Classified Information.--To the extent 
practicable, reports submitted under subsection (a) or any 
other provision of this title should be based on unclassified 
information. Portions of such reports may be classified.

[SEC. 309. REPEAL OF DUPLICATIVE PROVISIONS.]

                Section 81 of the Arms Export Control Act


   [22 U.S.C. 2798; P.L. 90-629, added by P.L. 102-182, sec. 305(b)]

SEC. 81. SANCTIONS AGAINST CERTAIN FOREIGN PERSONS.

  (a) Imposition of Sanctions.--
          (1) Determination by the president.--Except as 
        provided in subsection (b)(2), the President shall 
        impose both of the sanctions described in subsection 
        (c) if the President determines that a foreign person, 
        on or after the date of the enactment of this section, 
        has knowingly and materially contributed--
                  (A) through the export from the United States 
                of any goods or technology that are subject to 
                the jurisdiction of the United States,
                  (B) through the export from any other country 
                of any goods or technology that would be, if 
                they were United States goods or technology, 
                subject to the jurisdiction of the United 
                States, or
                  (C) through any other transaction not subject 
                to sanctions pursuant to the Export 
                Administration Act of 1979,
        to the efforts by any foreign country, project, or 
        entity described in paragraph (2) to use, develop, 
        produce, stockpile, or otherwise acquire chemical or 
        biological weapons.
          (2) Countries, projects, or entities receiving 
        assistance.--Paragraph (1) applies in the case of--
                  (A) any foreign country that the President 
                determines has, at any time after January 1, 
                1980--
                          (i) used chemical or biological 
                        weapons in violation of international 
                        law;
                          (ii) used lethal chemical or 
                        biological weapons against its own 
                        nationals; or
                          (iii) made substantial preparations 
                        to engage in the activities described 
                        in clause (i) or (ii);
                  (B) any foreign country whose government is 
                determined for purposes of section 6(j) of the 
                Export Administration Act of 1979 (50 U.S.C. 
                2405(j)) to be a government that has repeatedly 
                provided support for acts of international 
                terrorism; or
                  (C) any other foreign country, project, or 
                entity designated by the President for purposes 
                of this section.
          (3) Persons against whom sanctions are to be 
        imposed.--Sanctions shall be imposed pursuant to 
        paragraph (1) on--
                  (A) the foreign person with respect to which 
                the President makes the determination described 
                in that paragraph;
                  (B) any successor entity to that foreign 
                person;
                  (C) any foreign person that is a parent or 
                subsidiary of that foreign person if that 
                parent or subsidiary knowingly assisted in the 
                activities which were the basis of that 
                determination; and
                  (D) any foreign person that is an affiliate 
                of that foreign person if that affiliate 
                knowingly assisted in the activities which were 
                the basis of that determination and if that 
                affiliate is controlled in fact by that foreign 
                person.
  (b) Consultations With and Actions by Foreign Government of 
Jurisdiction.--
          (1) Consultations.--If the President makes the 
        determinations described in subsection (a)(1) with 
        respect to a foreign person, the Congress urges the 
        President to initiate consultations immediately with 
        the government with primary jurisdiction over that 
        foreign person with respect to the imposition of 
        sanctions pursuant to this section.
          (2) Actions by government of jurisdiction.--In order 
        to pursue such consultations with that government, the 
        President may delay imposition of sanctions pursuant to 
        this section for a period of up to 90 days. Following 
        these consultations, the President shall impose 
        sanctions unless the President determines and certifies 
        to the Congress that that government has taken specific 
        and effective actions, including appropriate penalties, 
        to terminate the involvement of the foreign person in 
        the activities described in subsection (a)(1). The 
        President may delay imposition of sanctions for an 
        additional period of up to 90 days if the President 
        determines and certifies to the Congress that that 
        government is in the process of taking the actions 
        described in the preceding sentence.
          (3) Report to congress.--The President shall report 
        to the Congress, not later than 90 days after making a 
        determination under subsection (a)(1), on the status of 
        consultations with the appropriate government under 
        this subsection, and the basis for any determination 
        under paragraph (2) of this subsection that such 
        government has taken specific corrective actions.
  (c) Sanctions.--
          (1) Description of sanctions.--The sanctions to be 
        imposed pursuant to subsection (a)(1) are, except as 
        provided in paragraph (2) of this subsection, the 
        following:
                  (A) Procurement sanction.--The United States 
                Government shall not procure, or enter into any 
                contract for the procurement of, any goods or 
                services from any person described in 
                subsection (a)(3).
                  (B) Import sanctions.--The importation into 
                the United States of products produced by any 
                person described in subsection (a)(3) shall be 
                prohibited.
          (2) Exceptions.--The President shall not be required 
        to apply or maintain sanctions under this section--
                  (A) in the case of procurement of defense 
                articles or defense services--
                          (i) under existing contracts or 
                        subcontracts, including the exercise of 
                        options for production quantities to 
                        satisfy United States operational 
                        military requirements;
                          (ii) if the President determines that 
                        the person or other entity to which the 
                        sanctions would otherwise be applied is 
                        a sole source supplier of the defense 
                        articles or services, that the defense 
                        articles or services are essential, and 
                        that alternative sources are not 
                        readily or reasonably available; or
                          (iii) if the President determines 
                        that such articles or services are 
                        essential to the national security 
                        under defense coproduction agreements;
                  (B) to products or services provided under 
                contracts entered into before the date on which 
                the President publishes his intention to impose 
                sanctions;
                  (C) to--
                          (i) spare parts,
                          (ii) component parts, but not 
                        finished products, essential to United 
                        States products or production, or
                          (iii) routine servicing and 
                        maintenance of products, to the extent 
                        that alternative sources are not 
                        readily or reasonably available;
                  (D) to information and technology essential 
                to United States products or production; or
                  (E) to medical or other humanitarian items.
  (d) Termination of Sanctions.--The sanctions imposed pursuant 
to this section shall apply for a period of at least 12 months 
following the imposition of sanctions and shall cease to apply 
thereafter only if the President determines and certifies to 
the Congress that reliable information indicates that the 
foreign person with respect to which the determination was made 
under subsection (a)(1) has ceased to aid or abet any foreign 
government, project, or entity in its efforts to acquire 
chemical or biological weapons capability as described in that 
subsection.
  (e) Waiver.--
          (1) Criterion for waiver.--The President may waive 
        the application of any sanction imposed on any person 
        pursuant to this section, after the end of the 12-month 
        period beginning on the date on which that sanction was 
        imposed on that person, if the President determines and 
        certifies to the Congress that such waiver is important 
        to the national security interests of the United 
        States.
          (2) Notification of and report to congress.--If the 
        President decides to exercise the waiver authority 
        provided in paragraph (1), the President shall so 
        notify the Congress not less than 20 days before the 
        waiver takes effect. Such notification shall include a 
        report fully articulating the rationale and 
        circumstances which led the President to exercise the 
        waiver authority.
  (f) Definition of Foreign Person.--For the purposes of this 
section, the term ``foreign person'' means--
          (1) an individual who is not a citizen of the United 
        States or an alien admitted for permanent residence to 
        the United States; or
          (2) a corporation, partnership, or other entity which 
        is created or organized under the laws of a foreign 
        country or which has its principal place of business 
        outside the United States.

                     E. EMBARGO ON TRADE WITH CUBA


    Section 620(a) of the Foreign Assistance Act of 1961, as amended


   [22 U.S.C. 2370; P.L. 87-195, as amended by Foreign Assistance Acts 
                     of 1963, 1965, and P.L. 95-88]

    Sec. 620. Prohibitions Against Furnishing Assistance.--
(a)(1) No assistance shall be furnished under this Act to the 
present government of Cuba. As an additional means of 
implementing and carrying into effect the policy of the 
preceding sentence, the President is authorized to establish 
and maintain a total embargo upon all trade between the United 
States and Cuba.
    (2) Except as may be deemed necessary by the President in 
the interest of the United States, no assistance shall be 
furnished under this Act of any government of Cuba, nor shall 
Cuba be entitled to receive any quota authorizing the 
importation of Cuban sugar into the United States or to receive 
any other benefit under any law of the United States, until the 
President determines that such government has taken appropriate 
steps according to international law standards to return to 
United States citizens, and to entities not less than 50 per 
centum beneficially owned by United States citizens, or to 
provide equitable compensation to such citizens and entities 
for property taken from such citizens and entities on or after 
January 1, 1959, by the Government of Cuba.

                      Cuban Democracy Act of 1992


 (Title XVII of the National Defense Authorization Act for Fiscal Year 
                                 1993)


 [22 U.S.C. 6001 et seq.; P.L. 102-484, title XVII, as amended by P.L. 
                                104-114]

SEC. 1701. SHORT TITLE.

    This Act may be cited as the ``Cuban Democracy Act of 
1992''.

SEC. 1702. FINDINGS.

    The Congress makes the following findings:
          (1) The government of Fidel Castro has demonstrated 
        consistent disregard for internationally accepted 
        standards of human rights and for democratic values. It 
        restricts the Cuban people's exercise of freedom of 
        speech, press, assembly, and other rights recognized by 
        the Universal Declaration of Human Rights adopted by 
        the General Assembly of the United Nations on December 
        10, 1948. It has refused to admit into Cuba the 
        representative of the United Nations Human Rights 
        Commission appointed to investigate human rights 
        violations on the island.
          (2) The Cuban people have demonstrated their yearning 
        for freedom and their increasing opposition to the 
        Castro government by risking their lives in organizing 
        independent, democratic activities on the island and by 
        undertaking hazardous flights for freedom to the United 
        States and other countries.
          (3) The Castro government maintains a military-
        dominated economy that has decreased the well-being of 
        the Cuban people in order to enable the government to 
        engage in military interventions and subversive 
        activities throughout the world and, especially, in the 
        Western Hemisphere. These have included involvement in 
        narcotics trafficking and support for the FMLN 
        guerrillas in El Salvador.
          (4) There is no sign that the Castro regime is 
        prepared to make any significant concessions to 
        democracy or to undertake any form of democratic 
        opening. Efforts to suppress dissent through 
        intimidation, imprisonment, and exile have accelerated 
        since the political changes that have occurred in the 
        former Soviet Union and Eastern Europe.
          (5) Events in the former Soviet Union and Eastern 
        Europe have dramatically reduced Cuba's external 
        support and threaten Cuba's food and oil supplies.
          (6) The fall of communism in the former Soviet Union 
        and Eastern Europe, the now universal recognition in 
        Latin America and the Caribbean that Cuba provides a 
        failed model of government and development, and the 
        evident inability of Cuba's economy to survive current 
        trends, provide the United States and the international 
        democratic community with an unprecedented opportunity 
        to promote a peaceful transition to democracy in Cuba.
          (7) However, Castro's intransigence increases the 
        likelihood that there could be a collapse of the Cuban 
        economy, social upheaval, or widespread suffering. The 
        recently concluded Cuban Communist Party Congress has 
        underscored Castro's unwillingness to respond 
        positively to increasing pressures for reform either 
        from within the party or without.
          (8) The United States cooperated with its European 
        and other allies to assist the difficult transitions 
        from Communist regimes in Eastern Europe. Therefore, it 
        is appropriate for those allies to cooperate with 
        United States policy to promote a peaceful transition 
        in Cuba.

SEC. 1703. STATEMENT OF POLICY.

    It should be the policy of the United States--
          (1) to seek a peaceful transition to democracy and a 
        resumption of economic growth in Cuba through the 
        careful application of sanctions directed at the Castro 
        government and support for the Cuban people;
          (2) to seek the cooperation of other democratic 
        countries in this policy;
          (3) to make clear to other countries that, in 
        determining its relations with them, the United States 
        will take into account their willingness to cooperate 
        in such a policy;
          (4) to seek the speedy termination of any remaining 
        military or technical assistance, subsidies, or other 
        forms of assistance to the Government of Cuba from any 
        of the independent states of the former Soviet Union;
          (5) to continue vigorously to oppose the human rights 
        violations of the Castro regime;
          (6) to maintain sanctions on the Castro regime so 
        long as it continues to refuse to move toward 
        democratization and greater respect for human rights;
          (7) to be prepared to reduce the sanctions in 
        carefully calibrated ways in response to positive 
        developments in Cuba;
          (8) to encourage free and fair elections to determine 
        Cuba's political future;
          (9) to request the speedy termination of any military 
        or technical assistance, subsidies, or other forms of 
        assistance to the Government of Cuba from the 
        government of any other country; and
          (10) to initiate immediately the development of a 
        comprehensive United States policy toward Cuba in a 
        post-Castro era.

SEC. 1704. INTERNATIONAL COOPERATION.

    (a) Cuban Trading Partners.--The President should encourage 
the governments of countries that conduct trade with Cuba to 
restrict their trade and credit relations with Cuba in a manner 
consistent with the purposes of this Act.
    (b) Sanctions Against Countries Assisting Cuba.--
          (1) Sanctions.--The President may apply the following 
        sanctions to any country that provides assistance to 
        Cuba:
                  (A) The government of such country shall not 
                be eligible for assistance under the Foreign 
                Assistance Act of 1961 or assistance or sales 
                under the Arms Export Control Act.
                  (B) Such country shall not be eligible, under 
                any program, for forgiveness or reduction of 
                debt owed to the United States Government.
          (2) Definition of assistance.--For purposes of 
        paragraph (1), the term ``assistance to Cuba''--
                  (A) means assistance to or for the benefit of 
                the Government of Cuba that is provided by 
                grant, concessional sale, guaranty, or 
                insurance, or by any other means on terms more 
                favorable than that generally available in the 
                applicable market, whether in the form of a 
                loan, lease, credit, or otherwise, and such 
                term includes subsidies for exports to Cuba and 
                favorable tariff treatment of articles that are 
                the growth, product, or manufacture of Cuba;
                  (B) includes an exchange, reduction, or 
                forgiveness of Cuban debt owed to a foreign 
                country in return for a grant of an equity 
                interest in a property, investment, or 
                operation of the Government of Cuba (including 
                the government of any political subdivision of 
                Cuba, and any agency or instrumentality of the 
                Government of Cuba) or of a Cuban national; and
                  (C) does not include--
                          (i) donations of food to non-
                        governmental organizations or 
                        individuals in Cuba, or
                          (ii) exports of medicines or medical 
                        supplies, instruments, or equipment 
                        that would be permitted under section 
                        5(c) of this Act.
                As used in this paragraph, the term ``agency or 
                instrumentality of the Government of Cuba'' 
                means an agency or instrumentality of a foreign 
                state as defined in section 1603(b) of title 
                28, United States Code, with each reference in 
                such section to ``a foreign state'' deemed to 
                be a reference to ``Cuba''.
          (3) Applicability of section.--This section, and any 
        sanctions imposed pursuant to this section shall cease 
        to apply at such time as the President makes and 
        reports to the Congress a determination under section 
        8(a).

SEC. 1705. SUPPORT FOR THE CUBAN PEOPLE.

    (a) Provisions of Law Affected.--The provisions of this 
section apply notwithstanding any other provision of law, 
including section 620(a) of the Foreign Assistance Act of 1961, 
and notwithstanding the exercise of authorities, before the 
enactment of this Act, under section 5(b) of the Trading With 
the Enemy Act, the International Emergency Economic Powers Act, 
or the Export Administration Act of 1979.
    (b) Donations of Food.--Nothing in this or any other Act 
shall prohibit donations of food to non-governmental 
organizations or individuals in Cuba.
    (c) Exports of Medicines and Medical Supplies.--Exports of 
medicines or medical supplies, instruments, or equipment to 
Cuba shall not be restricted--
          (1) except to the extent such restrictions would be 
        permitted under section 5(m) of the Export 
        Administration Act of 1979 or section 203(b)(2) of the 
        International Emergency Economic Powers Act;
          (2) except in a case in which there is a reasonable 
        likelihood that the item to be exported will be used 
        for purposes of torture or other human rights abuses;
          (3) except in a case in which there is a reasonable 
        likelihood that the item to be exported will be 
        reexported; and
          (4) except in a case in which the item to be exported 
        could be used in the production of any biotechnological 
        product.
    (d) Requirements for Certain Exports.--
          (1) Onsite verifications.--(A) Subject to 
        subparagraph (B), an export may be made under 
        subsection (c) only if the President determines that 
        the United States Government is able to verify, by 
        onsite inspections and other appropriate means, that 
        the exported item is to be used for the purposes for 
        which it was intended and only for the use and benefit 
        of the Cuban people.
          (B) Exception.--Subparagraph (A) does not apply to 
        donations to nongovernmental organizations in Cuba of 
        medicines for humanitarian purposes.
          (2) Licenses.--Exports permitted under subsection (c) 
        shall be made pursuant to specific licenses issued by 
        the United States Government.
    (e) Telecommunications Services and Facilities.--
          (1) Telecommunications services.--Telecommunications 
        services between the United States and Cuba shall be 
        permitted.
          (2) Telecommunications facilities.--
        Telecommunications facilities are authorized in such 
        quantity and of such quality as may be necessary to 
        provide efficient and adequate telecommunications 
        services between the United States and Cuba.
          (3) Licensing of payments to cuba.--(A) The President 
        may provide for the issuance of licenses for the full 
        or partial payment to Cuba of amounts due Cuba as a 
        result of the provision of telecommunications services 
        authorized by this subsection, in a manner that is 
        consistent with the public interest and the purposes of 
        this Act, except that this paragraph shall not require 
        any withdrawal from any account blocked pursuant to 
        regulations issued under section 5(b) of the Trading 
        With the Enemy Act.
          (B) If only partial payments are made to Cuba under 
        subparagraph (A), the amounts withheld from Cuba shall 
        be deposited in an account in a banking institution in 
        the United States. Such account shall be blocked in the 
        same manner as any other account containing funds in 
        which Cuba has any interest, pursuant to regulations 
        issued under section 5(b) of the Trading With the Enemy 
        Act.
          (4) Authority of federal communications commission.--
        Nothing in this subsection shall be construed to 
        supersede the authority of the Federal Communications 
        Commission.
          (5) Prohibition on investment in domestic 
        telecommunications services.--Nothing in this 
        subsection shall be construed to authorize the 
        investment by any United states person in the domestic 
        telecommunications network within Cuba. For purposes of 
        this paragraph, an ``investment'' in the domestic 
        telecommunications network within Cuba includes the 
        contribution (including by donation) of funds or 
        anything of value to or for, and the making of loans to 
        or for, such network.
          (6) Reports to congress.--The President shall submit 
        to the Congress on a semiannual basis a report 
        detailing payments made to Cuba by any United States 
        person as a result of the provision of 
        telecommunications services authorized by this 
        subsection.
    (f) Direct Mail Delivery to Cuba.--The United States Postal 
Service shall take such actions as are necessary to provide 
direct mail service to and from Cuba, including, in the absence 
of common carrier service between the 2 countries, the use of 
charter service providers.
    (g) Assistance To Support Democracy in Cuba.--The United 
States Government may provide assistance, through appropriate 
nongovernmental organizations, for the support of individuals 
and organizations to promote nonviolent democratic change in 
Cuba.

 SEC. 1706. SANCTIONS.

    (a) Prohibition on Certain Transactions Between Certain 
United States Firms and Cuba.--
          (1) Prohibition.--Notwithstanding any other provision 
        of law, no license may be issued for any transaction 
        described in section 515.559 of title 31, Code of 
        Federal Regulations, as in effect on July 1, 1989.
          (2) Applicability to existing contracts.--Paragraph 
        (1) shall not affect any contract entered into before 
        the date of the enactment of this Act.
    (b) Prohibitions on Vessels.--
          (1) Vessels engaging in trade.--Beginning on the 61st 
        day after the date of the enactment of this Act, a 
        vessel which enters a port or place in Cuba to engage 
        in the trade of goods or services may not, within 180 
        days after departure from such port or place in Cuba, 
        load or unload any freight at any place in the United 
        States, except pursuant to a license issued by the 
        Secretary of the Treasury.
          (2) Vessels carrying goods or passengers to or from 
        cuba.--Except as specifically authorized by the 
        Secretary of the Treasury, a vessel carrying goods or 
        passengers to or from Cuba or carrying goods in which 
        Cuba or a Cuban national has any interest may not enter 
        a United States port. For purposes of this paragraph, 
        the term ``Cuban national'' means a national of Cuba, 
        as the term ``national'' is defined in section 515.302 
        of title 31, Code of Federal Regulations, as of August 
        1, 1992.
          (3) Inapplicability of ship stores general license.--
        No commodities which may be exported under a general 
        license described in section 771.9 of title 15, Code of 
        Federal Regulations, as in effect on May 1, 1992, may 
        be exported under a general license to any vessel 
        carrying goods or passengers to or from Cuba or 
        carrying goods in which Cuba or a Cuban national has an 
        interest.
          (4) Definitions.--As used in this subsection--
                  (A) the term ``vessel'' includes every 
                description of water craft or other contrivance 
                used, or capable of being used, as a means of 
                transportation in water, but does not include 
                aircraft; and
                  (B) the term ``United States'' includes the 
                territories and possessions of the United 
                States and the customs waters of the United 
                States (as defined in section 401 of the Tariff 
                Act of 1930 (19 U.S.C. 1401)).
    (c) Restrictions on Remittances to Cuba.--The President 
shall establish strict limits on remittances to Cuba by United 
States persons for the purpose of financing the travel of 
Cubans to the United States, in order to ensure that such 
remittances reflect only the reasonable costs associated with 
such travel, and are not used by the Government of Cuba as a 
means of gaining access to United States currency.
    (d) Clarification of Applicability of Sanctions.--The 
prohibitions contained in subsections (a), (b), and (c) shall 
not apply with respect to any activity otherwise permitted by 
section 5 or section 7 of this Act or any activity which may 
not be regulated or prohibited under section 5(b)(4) of the 
Trading With the Enemy Act (50 U.S.C. App. 5(b)(4)).

SEC. 1707. POLICY TOWARD A TRANSITIONAL CUBAN GOVERNMENT.

    Food, medicine, and medical supplies for humanitarian 
purposes should be made available for Cuba under the Foreign 
Assistance Act of 1961 and the Agricultural Trade Development 
and Assistance Act of 1954 if the President determines and 
certifies to the Committee on Foreign Affairs of the House of 
Representatives and the Committee on Foreign Relations of the 
Senate that the government in power in Cuba--
          (1) has made a public commitment to hold free and 
        fair elections for a new government within 6 months and 
        is proceeding to implement that decision;
          (2) has made a public commitment to respect, and is 
        respecting, internationally recognized human rights and 
        basic democratic freedoms; and
          (3) is not providing weapons or funds to any group, 
        in any other country, that seeks the violent overthrow 
        of the government of that country.

SEC. 1708. POLICY TOWARD A DEMOCRATIC CUBAN GOVERNMENT.

    (a) Waiver of Restrictions.--The President may waive the 
requirements of section 6 if the President determines and 
reports to the Congress that the Government of Cuba--
          (1) has held free and fair elections conducted under 
        internationally recognized observers;
          (2) has permitted opposition parties ample time to 
        organize and campaign for such elections, and has 
        permitted full access to the media to all candidates in 
        the elections;
          (3) is showing respect for the basic civil liberties 
        and human rights of the citizens of Cuba;
          (4) is moving toward establishing a free market 
        economic system; and
          (5) has committed itself to constitutional change 
        that would ensure regular free and fair elections that 
        meet the requirements of paragraph (2).
    (b) Policies.--If the President makes a determination under 
subsection (a), the President shall take the following actions 
with respect to a Cuban Government elected pursuant to 
elections described in subsection (a):
          (1) To encourage the admission or reentry of such 
        government to international organizations and 
        international financial institutions.
          (2) To provide emergency relief during Cuba's 
        transition to a viable economic system.
          (3) To take steps to end the United States trade 
        embargo of Cuba.

SEC. 1709. EXISTING CLAIMS NOT AFFECTED.

    Except as provided in section 5(a), nothing in this Act 
affects the provisions of section 620(a)(2) of the Foreign 
Assistance Act of 1961.

SEC. 1710. ENFORCEMENT.

    (a) Enforcement Authority.--The authority to enforce this 
Act shall be carried out by the Secretary of the Treasury. The 
Secretary of the Treasury shall exercise the authorities of the 
Trading With the Enemy Act in enforcing this Act. In carrying 
out this subsection, the Secretary of the Treasury shall take 
the necessary steps to ensure that activities permitted under 
section 5 are carried out for the purposes set forth in this 
Act and not for purposes of the accumulation by the Cuban 
Government of excessive amounts of United States currency or 
the accumulation of excessive profits by any person or entity.
    (b) Authorization of Appropriations.--There are authorized 
to be appropriated to the Secretary of the Treasury such sums 
as may be necessary to carry out this Act.
    (c) Penalties Under the Trading With the Enemy Act.--
[Amends section 16 of the Trading With the Enemy Act (50 U.S.C. 
App. 16):
          [(1) by inserting ``(a)'' before ``That whoever''; 
        and
          (2) by adding at the end the following:
    ``(b)(1) The Secretary of the Treasury may impose a civil 
penalty of not more than $50,000 on any person who violates any 
license, order, rule, or regulation issued under this Act.
    ``(2) Any property, funds, securities, papers, or other 
articles or documents, or any vessel, together with its tackle, 
apparel, furniture, and equipment, that is the subject of a 
violation under paragraph (1) shall, at the discretion of the 
Secretary of the Treasury, be forfeited to the United States 
Government.
    ``(3) The penalties provided under this subsection may not 
be imposed for--
          ``(A) news gathering, research, or the export or 
        import of, or transmission of, information or 
        informational materials; or
          ``(B) clearly defined educational or religious 
        activities, or activities of recognized human rights 
        organizations, that are reasonably limited in 
        frequency, duration, and number of participants.
    ``(4) The penalties provided under this subsection may be 
imposed only on the record after opportunity for an agency 
hearing in accordance with sections 554 through 557 of title 5, 
United States Code, with the right to prehearing discovery.
    ``(5) Judicial review of any penalty imposed under this 
subsection may be had to the extent provided in section 702 of 
title 5, United States Code.''.]
    (d) Applicability of Penalties.--The penalties set forth in 
section 16 of the Trading With the Enemy Act shall apply to 
violations of this Act to the same extent as such penalties 
apply to violations under that Act.
    (e) Office of Foreign Assets Control.--The Department of 
the Treasury shall establish and maintain a branch of the 
Office of Foreign Assets Control in Miami, Florida, in order to 
strengthen the enforcement of this Act.

SEC. 1711. DEFINITION.

    As used in this Act, the term ``United States person'' 
means any United States citizen or alien admitted for permanent 
residence in the United States, and any corporation, 
partnership, or other organization organized under the laws of 
the United States.

SEC. 1712. EFFECTIVE DATE.

    This Act shall take effect on the date of the enactment of 
this Act.

     Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996


                               [Excerpts]


          [22 U.S.C. 6032, 6040, and 6062-6064; P.L. 104-114]

   TITLE I--STRENGTHENING INTERNATIONAL SANCTIONS AGAINST THE CASTRO 
GOVERNMENT

           *       *       *       *       *       *       *



SEC. 102. ENFORCEMENT OF THE ECONOMIC EMBARGO OF CUBA.

   (a) Policy.--
           (1) Restrictions by other countries.--The Congress 
        hereby reaffirms section 1704(a) of the Cuban Democracy 
        Act of 1992, which states that the President should 
        encourage foreign countries to restrict trade and 
        credit relations with Cuba in a manner consistent with 
        the purposes of that Act.
           (2) Sanctions on other countries.--The Congress 
        further urges the President to take immediate steps to 
        apply the sanctions described in section 1704(b)(1) of 
        that Act against countries assisting Cuba.
   (b) Diplomatic Efforts.--The Secretary of State should 
ensure that United States diplomatic personnel abroad 
understand and, in their contacts with foreign officials, are 
communicating the reasons for the United States economic 
embargo of Cuba, and are urging foreign governments to 
cooperate more effectively with the embargo.
   (c) Existing Regulations.--The President shall instruct the 
Secretary of the Treasury and the Attorney General to enforce 
fully the Cuban Assets Control Regulations set forth in part 
515 of title 31, Code of Federal Regulations.
   (d) Trading With the Enemy Act.--
          [(1) amends section 16(b) of the Trading With the 
        Enemy Act (50 U.S.C. App. 16(b)), as added by Public 
        Law 102-484, to read as follows:
                  [``(b)(1) A civil penalty of not to exceed 
                $50,000 may be imposed by the Secretary of the 
                Treasury on any person who violates any 
                license, order, rule, or regulation issued in 
                compliance with the provisions of this Act.
                  [``(2) Any property, funds, securities, 
                papers, or other articles or documents, or any 
                vessel, together with its tackle, apparel, 
                furniture, and equipment, that is the subject 
                of a violation under paragraph (1) shall, at 
                the direction of the Secretary of the Treasury, 
                be forfeited to the United States Government.
                  [``(3) The penalties provided under this 
                subsection may be imposed only on the record 
                after opportunity for an agency hearing in 
                accordance with sections 554 through 557 of 
                title 5, United States Code, with the right to 
                prehearing discovery.
                  [``(4) Judicial review of any penalty imposed 
                under this subsection may be had to the extent 
                provided in section 702 of title 5, United 
                States Code.''.
          [(2) Further amends section 16 of the Trading With 
        the Enemy Act by striking subsection (b), as added by 
        Public Law 102-393, concerning criminal forfeiture.]
  (e) Denial of Visas to Certain Cuban Nationals.--It is the 
sense of the Congress that the President should instruct the 
Secretary of State and the Attorney General to enforce fully 
existing regulations to deny visas to Cuban nationals 
considered by the Secretary of State to be officers or 
employees of the Cuban Government or of the Communist Party of 
Cuba.
  [(f) Amends section 1704(b)(2) of the Cuban Democracy Act of 
1992 (22 U.S.C. 6003(b)(2)) concerning coverage of debt-for-
equity swaps by the economic embargo of Cuba.
  [(g) Amends section 1705(e) of the Cuban Democracy Act of 
1992 (22 U.S.C. 6004(e)) concerning telecommunications 
services.]
   (h) Codification of Economic Embargo.--The economic embargo 
of Cuba, as in effect on March 1, 1996, including all 
restrictions under part 515 of title 31, Code of Federal 
Regulations, shall be in effect upon the enactment of this Act, 
and shall remain in effect, subject to section 204 of this Act. 
the term ``agency'' in section 551(1) of title 5, United States 
Code.

           *       *       *       *       *       *       *


 SEC. 110. IMPORTATION SAFEGUARD AGAINST CERTAIN CUBAN PRODUCTS.

   (a) Prohibition on Import of and Dealings in Cuban 
Products.--The Congress notes that section 515.204 of title 31, 
Code of Federal Regulations, prohibits the entry of, and 
dealings outside the United States in, merchandise that--
           (1) is of Cuban origin;
           (2) is or has been located in or transported from or 
        through Cuba; or
           (3) is made or derived in whole or in part of any 
        article which is the growth, produce, or manufacture of 
        Cuba.
  (b) Effect of NAFTA.--The Congress notes that United States 
accession to the North American Free Trade Agreement does not 
modify or alter the United States sanctions against Cuba. The 
statement of administrative action accompanying that trade 
agreement specifically states the following:
          (1) ``The NAFTA rules of origin will not in any way 
        diminish the Cuban sanctions program. . . . Nothing in 
        the NAFTA would operate to override this 
        prohibition.''.
           (2) ``Article 309(3) [of the NAFTA] permits the 
        United States to ensure that Cuban products or goods 
        made from Cuban materials are not imported into the 
        United States from Mexico or Canada and that United 
        States products are not exported to Cuba through those 
        countries.''.
   (c) Restriction of Sugar Imports.--The Congress notes that 
section 902(c) of the Food Security Act of 1985 (Public Law 99-
198) requires the President not to allocate any of the sugar 
import quota to a country that is a net importer of sugar 
unless appropriate officials of that country verify to the 
President that the country does not import for reexport to the 
United States any sugar produced in Cuba.
   (d) Assurances Regarding Sugar Products.--Protection of 
essential security interests of the United States requires 
assurances that sugar products that are entered, or withdrawn 
from warehouse for consumption, into the customs territory of 
the United States are not products of Cuba.

 TITLE II--ASSISTANCE TO A FREE AND INDEPENDENT CUBA

           *       *       *       *       *       *       *



 SEC. 202. ASSISTANCE FOR THE CUBAN PEOPLE.

   (a) Authorization.--
           (1) In general.--The President shall develop a plan 
        for providing economic assistance to Cuba at such time 
        as the President determines that a transition 
        government or a democratically elected government in 
        Cuba (as determined under section 203(c)) is in power.
           (2) Effect on other laws.--Assistance may be 
        provided under this section subject to an authorization 
        of appropriations and subject to the availability of 
        appropriations.
   (b) Plan for Assistance.--
           (1) Development of plan.--The President shall 
        develop a plan for providing assistance under this 
        section--
                   (A) to Cuba when a transition government in 
                Cuba is in power; and
                   (B) to Cuba when a democratically elected 
                government in Cuba is in power.
           (2) Types of assistance.--Assistance under the plan 
        developed under paragraph (1) may, subject to an 
        authorization of appropriations and subject to the 
        availability of appropriations, include the following:
                   (A) Transition government.--(i) Except as 
                provided in clause (ii), assistance to Cuba 
                under a transition government shall, subject to 
                an authorization of appropriations and subject 
                to the availability of appropriations, be 
                limited to--
                           (I) such food, medicine, medical 
                        supplies and equipment, and assistance 
                        to meet emergency energy needs, as is 
                        necessary to meet the basic human needs 
                        of the Cuban people; and
                           (II) assistance described in 
                        subparagraph (C).
                  (ii) Assistance in addition to assistance 
                under clause (i) may be provided, but only 
                after the President certifies to the 
                appropriate congressional committees, in 
                accordance with procedures applicable to 
                reprogramming notifications under section 634A 
                of the Foreign Assistance Act of 1961, that 
                such assistance is essential to the successful 
                completion of the transition to democracy.
                   (iii) Only after a transition government in 
                Cuba is in power, freedom of individuals to 
                travel to visit their relatives without any 
                restrictions shall be permitted.
                   (B) Democratically elected government.--
                Assistance to a democratically elected 
                government in Cuba may, subject to an 
                authorization of appropriations and subject to 
                the availability of appropriations, consist of 
                economic assistance in addition to assistance 
                available under subparagraph (A), together with 
                assistance described in subparagraph (C). Such 
                economic assistance may include--
                           (i) assistance under chapter 1 of 
                        part I (relating to development 
                        assistance), and chapter 4 of part II 
                        (relating to the economic support 
                        fund), of the Foreign Assistance Act of 
                        1961;
                           (ii) assistance under the 
                        Agricultural Trade Development and 
                        Assistance Act of 1954;
                           (iii) financing, guarantees, and 
                        other forms of assistance provided by 
                        the Export-Import Bank of the United 
                        States;
                           (iv) financial support provided by 
                        the Overseas Private Investment 
                        Corporation for investment projects in 
                        Cuba;
                           (v) assistance provided by the Trade 
                        and Development Agency;
                           (vi) Peace Corps programs; and
                           (vii) other appropriate assistance 
                        to carry out the policy of section 201.
                   (C) Military adjustment assistance.--
                Assistance to a transition government in Cuba 
                and to a democratically elected government in 
                Cuba shall also include assistance in preparing 
                the Cuban military forces to adjust to an 
                appropriate role in a democracy.
   (c) Strategy for Distribution.--The plan developed under 
subsection (b) shall include a strategy for distributing 
assistance under the plan.
  (d) Distribution.--Assistance under the plan developed under 
subsection (b) shall be provided through United States 
Government organizations and nongovernmental organizations and 
private and voluntary organizations, whether within or outside 
the United States, including humanitarian, educational, labor, 
and private sector organizations.
  (e) International Efforts.--The President shall take the 
necessary steps--
           (1) to seek to obtain the agreement of other 
        countries and of international financial institutions 
        and multilateral organizations to provide to a 
        transition government in Cuba, and to a democratically 
        elected government in Cuba, assistance comparable to 
        that provided by the United States under this Act; and
           (2) to work with such countries, institutions, and 
        organizations to coordinate all such assistance 
        programs.
   (f) Communication with the Cuban People.--The President 
shall take the necessary steps to communicate to the Cuban 
people the plan for assistance developed under this section.
   (g) Report to Congress.--Not later than 180 days after the 
date of the enactment of this Act, the President shall transmit 
to the appropriate congressional committees a report describing 
in detail the plan developed under this section.
   (h) Report on Trade and Investment Relations.--
           (1) Report to congress.--The President, following 
        the transmittal to the Congress of a determination 
        under section 203(c)(3) that a democratically elected 
        government in Cuba is in power, shall submit to the 
        Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate and the appropriate congressional committees a 
        report that describes--
                   (A) acts, policies, and practices which 
                constitute significant barriers to, or 
                distortions of, United States trade in goods or 
                services or foreign direct investment with 
                respect to Cuba;
                  (B) policy objectives of the United States 
                regarding trade relations with a democratically 
                elected government in Cuba, and the reasons 
                therefor, including possible--
                          (i) reciprocal extension of 
                        nondiscriminatory trade treatment 
                        (most-favored-nation treatment);
                           (ii) designation of Cuba as a 
                        beneficiary developing country under 
                        title V of the Trade Act of 1974 
                        (relating to the Generalized System of 
                        Preferences) or as a beneficiary 
                        country under the Caribbean Basin 
                        Economic Recovery Act, and the 
                        implications of such designation with 
                        respect to trade with any other country 
                        that is such a beneficiary developing 
                        country or beneficiary country or is a 
                        party to the North American Free Trade 
                        Agreement; and
                           (iii) negotiations regarding free 
                        trade, including the accession of Cuba 
                        to the North American Free Trade 
                        Agreement;
                   (C) specific trade negotiating objectives of 
                the United States with respect to Cuba, 
                including the objectives described in section 
                108(b)(5) of the North American Free Trade 
                Agreement Implementation Act (19 U.S.C. 
                3317(b)(5)); and
                   (D) actions proposed or anticipated to be 
                undertaken, and any proposed legislation 
                necessary or appropriate, to achieve any of 
                such policy and negotiating objectives.
           (2) Consultation.--The President shall consult with 
        the Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate and the appropriate congressional committees and 
        shall seek advice from the appropriate advisory 
        committees established under section 135 of the Trade 
        Act of 1974 regarding the policy and negotiating 
        objectives and the legislative proposals described in 
        paragraph (1).

SEC. 203. COORDINATION OF ASSISTANCE PROGRAM; IMPLEMENTATION AND 
                    REPORTS TO CONGRESS; REPROGRAMMING.

  (a) Coordinating Official.--The President shall designate a 
coordinating official who shall be responsible for--
          (1) implementing the strategy for distributing 
        assistance described in section 202(b);
          (2) ensuring the speedy and efficient distribution of 
        such assistance; and
          (3) ensuring coordination among, and appropriate 
        oversight by, the agencies of the United States that 
        provide assistance described in section 202(b), 
        including resolving any disputes among such agencies.
  (b) United States-Cuba Council.--Upon making a determination 
under subsection (c)(3) that a democratically elected 
government in Cuba is in power, the President, after 
consultation with the coordinating official, is authorized to 
designate a United States-Cuba council--
          (1) to ensure coordination between the United States 
        Government and the private sector in responding to 
        change in Cuba, and in promoting market-based 
        development in Cuba; and
          (2) to establish periodic meetings between 
        representatives of the United States and Cuban private 
        sectors for the purpose of facilitating bilateral 
        trade.
  (c) Implementation of Plan; Reports to Congress.--
          (1) Implementation with respect to transition 
        government.--Upon making a determination that a 
        transition government in Cuba is in power, the 
        President shall transmit that determination to the 
        appropriate congressional committees and shall, subject 
        to an authorization of appropriations and subject to 
        the availability of appropriations, commence the 
        delivery and distribution of assistance to such 
        transition government under the plan developed under 
        section 202(b).
          (2) Reports to congress.--(A) The President shall 
        transmit to the appropriate congressional committees a 
        report setting forth the strategy for providing 
        assistance described in section 202(b)(2) (A) and (C) 
        to the transition government in Cuba under the plan of 
        assistance developed under section 202(b), the types of 
        such assistance, and the extent to which such 
        assistance has been distributed in accordance with the 
        plan.
          (B) The President shall transmit the report not later 
        than 90 days after making the determination referred to 
        in paragraph (1), except that the President shall 
        transmit the report in preliminary form not later than 
        15 days after making that determination.
          (3) Implementation with respect to democratically 
        elected government.--The President shall, upon 
        determining that a democratically elected government in 
        Cuba is in power, submit that determination to the 
        appropriate congressional committees and shall, subject 
        to an authorization of appropriations and subject to 
        the availability of appropriations, commence the 
        delivery and distribution of assistance to such 
        democratically elected government under the plan 
        developed under section 202(b).
          (4) Annual reports to congress.--Not later than 60 
        days after the end of each fiscal year, the President 
        shall transmit to the appropriate congressional 
        committees a report on the assistance provided under 
        the plan developed under section 202(b), including a 
        description of each type of assistance, the amounts 
        expended for such assistance, and a description of the 
        assistance to be provided under the plan in the current 
        fiscal year.
  (d) Reprogramming.--Any changes in the assistance to be 
provided under the plan developed under section 202(b) may not 
be made unless the President notifies the appropriate 
congressional committees at least 15 days in advance in 
accordance with the procedures applicable to reprogramming 
notifications under section 634A of the Foreign Assistance Act 
of 1961 (22 U.S.C. 2394-1).

SEC. 204. TERMINATION OF THE ECONOMIC EMBARGO OF CUBA.

  (a) Presidential Actions.--Upon submitting a determination to 
the appropriate congressional committees under section 
203(c)(1) that a transition government in Cuba is in power, the 
President, after consultation with the Congress, is authorized 
to take steps to suspend the economic embargo of Cuba and to 
suspend the right of action created in section 302 with respect 
to actions thereafter filed against the Cuban Government, to 
the extent that such steps contribute to a stable foundation 
for a democratically elected government in Cuba.
  (b) Suspension of Certain Provisions of Law.--In carrying out 
subsection (a), the President may suspend the enforcement of--
          (1) section 620(a) of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2370(a));
          (2) section 620(f) of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2370(f)) with respect to the ``Republic 
        of Cuba'';
          (3) sections 1704, 1705(d), and 1706 of the Cuban 
        Democracy Act of 1992 (22 U.S.C. 6003, 6004(d), and 
        6005);
          (4) section 902(c) of the Food Security Act of 1985; 
        and
          (5) the prohibitions on transactions described in 
        part 515 of title 31, Code of Federal Regulations.
  (c) Additional Presidential Actions.--Upon submitting a 
determination to the appropriate congressional committees under 
section 203(c)(3) that a democratically elected government in 
Cuba is in power, the President shall take steps to terminate 
the economic embargo of Cuba, including the restrictions under 
part 515 of title 31, Code of Federal Regulations.
  (d) Conforming Amendments.--On the date on which the 
President submits a determination under section 203(c)(3)--
          (1) section 620(a) of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2370(a)) is repealed;
          (2) section 620(f) of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2370(f)) is amended by striking 
        ``Republic of Cuba'';
          (3) sections 1704, 1705(d), and 1706 of the Cuban 
        Democracy Act of 1992 (22 U.S.C. 6003, 6004(d), and 
        6005) are repealed; and
          (4) section 902(c) of the Food Security Act of 1985 
        is repealed.
  (e) Review of Suspension of Economic Embargo.--
          (1) Review.--If the President takes action under 
        subsection (a) to suspend the economic embargo of Cuba, 
        the President shall immediately so notify the Congress. 
        The President shall report to the Congress no less 
        frequently than every 6 months thereafter, until he 
        submits a determination under section 203(c)(3) that a 
        democratically elected government in Cuba is in power, 
        on the progress being made by Cuba toward the 
        establishment of such a democratically elected 
        government. The action of the President under 
        subsection (a) shall cease to be effective upon the 
        enactment of a joint resolution described in paragraph 
        (2).
          (2) Joint resolutions.--For purposes of this 
        subsection, the term ``joint resolution'' means only a 
        joint resolution of the 2 Houses of Congress, the 
        matter after the resolving clause of which is as 
        follows: ``That the Congress disapproves the action of 
        the President under section 204(a) of the Cuban Liberty 
        and Democratic Solidarity (LIBERTAD) Act of 1996 to 
        suspend the economic embargo of Cuba, notice of which 
        was submitted to the Congress on ----.'', with the 
        blank space being filled with the appropriate date.
          (3) Referral to committees.--Joint resolutions 
        introduced in the House of Representatives shall be 
        referred to the Committee on International Relations 
        and joint resolutions introduced in the Senate shall be 
        referred to the Committee on Foreign Relations.
          (4) Procedures.--(A) Any joint resolution shall be 
        considered in the Senate in accordance with the 
        provisions of section 601(b) of the International 
        Security Assistance and Arms Export Control Act of 
        1976.
          (B) For the purpose of expediting the consideration 
        and enactment of joint resolutions, a motion to proceed 
        to the consideration of any joint resolution after it 
        has been reported by the appropriate committee shall be 
        treated as highly privileged in the House of 
        Representatives.
          (C) Not more than 1 joint resolution may be 
        considered in the House of Representatives and the 
        Senate in the 6-month period beginning on the date on 
        which the President notifies the Congress under 
        paragraph (1) of the action taken under subsection (a), 
        and in each 6-month period thereafter.

          F. ECONOMIC SANCTIONS AGAINST IRAQ, IRAN, AND LIBYA


                       Iraq Sanctions Act of 1990


   (Sections 586-586I of the Foreign Assistance and Related Programs 
                        Appropriation Act, 1991)


                               [Excerpts]


                  [50 U.S.C. 1701 note; P.L. 101-513]

SEC. 586. SHORT TITLE.

    Sections 586 through 586J of this Act may be cited as the 
``Iraq Sanctions Act of 1990''.

           *       *       *       *       *       *       *


SEC. 586C. TRADE EMBARGO AGAINST IRAQ.

    (a) Continuation of Embargo.--Except as otherwise provided 
in this section, the President shall continue to impose the 
trade embargo and other economic sanctions with respect to Iraq 
and Kuwait that the United States is imposing, in response to 
Iraq's invasion of Kuwait, pursuant to Executive Orders 
Numbered 12724 and 12725 (August 9, 1990) and, to the extent 
they are still in effect, Executive Orders Numbered 12722 and 
12723 (August 2, 1990). Notwithstanding any other provision of 
law, no funds, credits, guarantees, or insurance appropriated 
or otherwise made available by this or any other Act for fiscal 
year 1991 or any fiscal year thereafter shall be used to 
support or administer any financial or commercial operation of 
any United States Government department, agency, or other 
entity, or of any person subject to the jurisdiction of the 
United States, for the benefit of the Government of Iraq, its 
agencies or instrumentalities, or any person working on behalf 
of the Government of Iraq, contrary to the trade embargo and 
other economic sanctions imposed in accordance with this 
section.
    (b) Humanitarian Assistance.--To the extent that 
transactions involving foodstuffs or payments for foodstuffs 
are exempted ``in humanitarian circumstances'' from the 
prohibitions established by the United States pursuant to 
United Nations Security Council Resolution 661 (1990), those 
exemptions shall be limited to foodstuffs that are to be 
provided consistent with United Nations Security Council 
Resolution 666 (1990) and other relevant Security Council 
resolutions.
    (c) Notice to Congress of Exceptions to and Termination of 
Sanctions.--
          (1) Notice of regulations.--Any regulations issued 
        after the date of enactment of this Act with respect to 
        the economic sanctions imposed with respect to Iraq and 
        Kuwait by the United States under Executive Orders 
        Numbered 12722 and 12723 (August 2, 1990) and Executive 
        Orders Numbered 12724 and 12725 (August 9, 1990) shall 
        be submitted to the Congress before these regulations 
        take effect.
          (2) Notice of termination of sanctions.--The 
        President shall notify the Congress at least 15 days 
        before the termination, in whole or in part, of any 
        sanction imposed with respect to Iraq or Kuwait 
        pursuant to those Executive orders.
    (d) Relation to Other Laws.--
          (1) Sanctions legislation.--The sanctions that are 
        described in subsection (a) are in addition to, and not 
        in lieu of the sanctions provided for in section 586G 
        of this Act or any other provision of law.
          (2) National emergencies and united nations 
        legislation.--Nothing in this section supersedes any 
        provision of the National Emergencies Act or any 
        authority of the President under the International 
        Emergency Economic Powers Act or section 5(a) of the 
        United Nations Participation Act of 1945.

SEC. 586D. COMPLIANCE WITH UNITED NATIONS SANCTIONS AGAINST IRAQ.

    (a) Denial of Assistance.--None of the funds appropriated 
or otherwise made available pursuant to this Act to carry out 
the Foreign Assistance Act of 1961 (including title IV of 
chapter 2 of part I, relating to the Overseas Private 
Investment Corporation) or the Arms Export Control Act may be 
used to provide assistance to any country that is not in 
compliance with the United Nations Security Council sanctions 
against Iraq unless the President determines and so certifies 
to the Congress that--
          (1) such assistance is in the national interest of 
        the United States;
          (2) such assistance will directly benefit the needy 
        people in that country; or
          (3) the assistance to be provided will be 
        humanitarian assistance for foreign nationals who have 
        fled Iraq and Kuwait.
    (b) Import Sanctions.--If the President considers that the 
taking of such action would promote the effectiveness of the 
economic sanctions of the United Nations and the United States 
imposed with respect to Iraq, and is consistent with the 
national interest, the President may prohibit, for such a 
period of time as he considers appropriate, the importation 
into the United States of any or all products of any foreign 
country that has not prohibited--
          (1) the importation of products of Iraq into its 
        customs territory, and
          (2) the export of its products to Iraq.

SEC. 586E. PENALTIES FOR VIOLATIONS OF EMBARGO.

    Notwithstanding section 206 of the International Emergency 
Economic Powers Act (50 U.S.C. 1705) and section 5(b) of the 
United Nations Participation Act of 1945 (22 U.S.C. 287c(b))--
          (1) a civil penalty of not to exceed $250,000 may be 
        imposed on any person who, after the date of enactment 
        of this Act, violates or evades or attempts to violate 
        or evade Executive Order Numbered 12722, 12723, 12724, 
        or 12725 or any license, order, or regulation issued 
        under any such Executive order; and
          (2) whoever, after the date of enactment of this Act, 
        willfully violates or evades or attempts to violate or 
        evade Executive Order Numbered 12722, 12723, 12724, or 
        12725 or any license, order, or regulation issued under 
        any such Executive order--
                  (A) shall, upon conviction, be fined not more 
                than $1,000,000, if a person other than a 
                natural person; or
                  (B) if a natural person, shall, upon 
                conviction, be fined not more than $1,000,000, 
                be imprisoned for not more than 12 years, or 
                both.
Any officer, director, or agent of any corporation who 
knowingly participates in a violation, evasion, or attempt 
described in paragraph (2) may be punished by imposition of the 
fine or imprisonment (or both) specified in subparagraph (B) of 
that paragraph.

           *       *       *       *       *       *       *


SEC. 586G. SANCTIONS AGAINST IRAQ.

    (a) Imposition.--Except as provided in section 586H, the 
following sanctions shall apply with respect to Iraq:
          (1) FMS sales.--The United States Government shall 
        not enter into any sale with Iraq under the Arms Export 
        Control Act.
          (2) Commercial arms sales.--Licenses shall not be 
        issued for the export to Iraq of any item on the United 
        States Munitions List.
          (3) Exports of certain goods and technology.--The 
        authorities of section 6 of the Export Administration 
        Act of 1979 (50 U.S.C. App. 2405) shall be used to 
        prohibit the export to Iraq of any goods or technology 
        listed pursuant to that section or section 5(c)(1) of 
        that Act (50 U.S.C. App. 2404(c)(1)) on the control 
        list provided for in section 4(b) of that Act (50 
        U.S.C. App. 2403(b)).
          (4) Nuclear equipment, materials, and technology.--
                  (A) NRC licenses.--The Nuclear Regulatory 
                Commission shall not issue any license or other 
                authorization under the Atomic Energy Act of 
                1954 (42 U.S.C. 2011 and following) for the 
                export to Iraq of any source or special nuclear 
                material, any production or utilization 
                facility, any sensitive nuclear technology, any 
                component, item, or substance determined to 
                have significance for nuclear explosive 
                purposes pursuant to section 109b of the Atomic 
                Energy Act of 1954 (42 U.S.C. 2139(b)), or any 
                other material or technology requiring such a 
                license or authorization.
                  (B) Distribution of nuclear materials.--The 
                authority of the Atomic Energy Act of 1954 
                shall not be used to distribute any special 
                nuclear material, source material, or byproduct 
                material to Iraq.
                  (C) DOE authorizations.--The Secretary of 
                Energy shall not provide a specific 
                authorization under section 57b. (2) of the 
                Atomic Energy Act of 1954 (42 U.S.C. 
                2077(b)(2)) for any activity that would 
                constitute directly or indirectly engaging in 
                Iraq in activities that require a specific 
                authorization under that section.
          (5) Assistance from international financial 
        institutions.--The United States shall oppose any loan 
        or financial or technical assistance to Iraq by 
        international financial institutions in accordance with 
        section 701 of the International Financial Institutions 
        Act (22 U.S.C. 262d).
          (6) Assistance through the export-import bank.--
        Credits and credit guarantees through the Export-Import 
        Bank of the United States shall be denied to Iraq.
          (7) Assistance through the commodity credit 
        corporation.--Credit, credit guarantees, and other 
        assistance through the Commodity Credit Corporation 
        shall be denied to Iraq.
          (8) Foreign assistance.--All forms of assistance 
        under the Foreign Assistance Act of 1961 (22 U.S.C. 
        2151 and following) other than emergency assistance for 
        medical supplies and other forms of emergency 
        humanitarian assistance, and under the Arms Exports 
        Control Act (22 U.S.C. 2751 and following) shall be 
        denied to Iraq.
    (b) Contract Sanctity.--For purposes of the export controls 
imposed pursuant to subsection (a)(3), the date described in 
subsection (m)(1) of section 6 of the Export Administration Act 
of 1979 (50 U.S.C. App. 2405) shall be deemed to be August 1, 
1990.

SEC. 586H. WAIVER AUTHORITY.

    (a) In General.--The President may waive the requirements 
of any paragraph of section 586G(a) if the President makes a 
certification under subsection (b) or subsection (c).
    (b) Certification of Fundamental Changes in Iraqi Policies 
and Actions.--The authority of subsection (a) may be exercised 
60 days after the President certifies to the Congress that--
          (1) the Government of Iraq--
                  (A) has demonstrated, through a pattern of 
                conduct, substantial improvement in its respect 
                for internationally recognized human rights;
                  (B) is not acquiring, developing, or 
                manufacturing (i) ballistic missiles, (ii) 
                chemical, biological, or nuclear weapons, or 
                (iii) components for such weapons; has forsworn 
                the first use of such weapons; and is taking 
                substantial and verifiable steps to destroy or 
                otherwise dispose of any such missiles and 
                weapons it possesses; and
                  (C) does not provide support for 
                international terrorism;
          (2) the Government of Iraq is in substantial 
        compliance with its obligations under international 
        law, including--
                  (A) the Charter of the United Nations;
                  (B) the International Covenant on Civil and 
                Political Rights (done at New York, December 
                16, 1966) and the International Covenant on 
                Economic, Social, and Cultural Rights (done at 
                New York, December 16, 1966);
                  (C) the Convention on the Prevention and 
                Punishment of the Crime of Genocide (done at 
                Paris, December 9, 1948);
                  (D) the Protocol for the Prohibition of the 
                Use in War of Asphyxiating, Poisonous or Other 
                Gases, and of Bacteriological Methods of 
                Warfare (done at Geneva, June 17, 1925);
                  (E) the Treaty on the Non-Proliferation of 
                Nuclear Weapons (done at Washington, London, 
                and Moscow, July 1, 1968); and
                  (F) the Convention on the Prohibition of the 
                Development, Production and Stockpiling of 
                Bacteriological (Biological) and Toxin Weapons 
                and on Their Destruction (done at Washington, 
                London, and Moscow, April 10, 1972); and
          (3) the President has determined that it is essential 
        to the national interests of the United States to 
        exercise the authority of subsection (a).
    (c) Certification of Fundamental Changes in Iraqi 
Leadership and Policies.--The authority of subsection (a) may 
be exercised 30 days after the President certifies to the 
Congress that--
          (1) there has been a fundamental change in the 
        leadership of the Government of Iraq; and
          (2) the new Government of Iraq has provided reliable 
        and credible assurance that--
                  (A) it respects internationally recognized 
                human rights and it will demonstrate such 
                respect through its conduct;
                  (B) it is not acquiring, developing, or 
                manufacturing and it will not acquire, develop, 
                or manufacture (i) ballistic missiles, (ii) 
                chemical, biological, or nuclear weapons, or 
                (iii) components for such weapons; has forsworn 
                the first use of such weapons; and is taking 
                substantial and verifiable steps to destroy or 
                otherwise dispose of any such missiles and 
                weapons it possesses;
                  (C) it is not and will not provide support 
                for international terrorism; and
                  (D) it is and will continue to be in 
                substantial compliance with its obligations 
                under international law, including all the 
                treaties specified in subparagraphs (A) through 
                (F) of subsection (b)(2).
    (d) Information To Be Included in Certifications.--Any 
certification under subsection (b) or (c) shall include the 
justification for each determination required by that 
subsection. The certification shall also specify which 
paragraphs of section 586G(a) the President will waive pursuant 
to that certification.

SEC. 586I. DENIAL OF LICENSES FOR CERTAIN EXPORTS TO COUNTRIES 
                    ASSISTING IRAQ'S ROCKET OR CHEMICAL, BIOLOGICAL, OR 
                    NUCLEAR WEAPONS CAPABILITY.

    (a) Restriction on Export Licenses.--None of the funds 
appropriated by this or any other Act may be used to approve 
the licensing for export of any supercomputer to any country 
whose government the President determines is assisting, or 
whose government officials the President determines are 
assisting, Iraq to improve its rocket technology or chemical, 
biological, or nuclear weapons capability.
    (b) Negotiations.--The President is directed to begin 
immediate negotiations with those governments with which the 
United States has bilateral supercomputer agreements, including 
the Government of the United Kingdom and the Government of 
Japan, on conditions restricting the transfer to Iraq of 
supercomputer or associated technology.

           *       *       *       *       *       *       *


              Iran-Iraq Arms Non-Proliferation Act of 1992


 (Title XVI of the National Defense Authorization Act for Fiscal Year 
                                 1993)


   [50 U.S.C. 1701 note; P.L. 102-484, title XVI, and P.L. 104-106, 
                          section 1408(a)-(c)]

SEC. 1601. SHORT TITLE.

    This title may be cited as the ``Iran-Iraq Arms Non-
Proliferation Act of 1992''.

SEC. 1602. UNITED STATES POLICY.

    (a) In General.--It shall be the policy of the United 
States to oppose, and urgently to seek the agreement of other 
nations also to oppose, any transfer to Iran or Iraq of any 
goods or technology, including dual-use goods or technology, 
wherever that transfer could materially contribute to either 
country's acquiring chemical, biological, nuclear, or 
destabilizing numbers and types of advanced conventional 
weapons.
    (b) Sanctions.--(1) In the furtherance of this policy, the 
President shall apply sanctions and controls with respect to 
Iran, Iraq, and those nations and persons who assist them in 
acquiring weapons of mass destruction in accordance with the 
Foreign Assistance Act of 1961, the Nuclear Non-Proliferation 
Act of 1978, the Chemical and Biological Weapons Control and 
Warfare Elimination Act of 1991, chapter 7 of the Arms Export 
Control Act, and other relevant statutes, regarding the non-
proliferation of weapons of mass destruction and the means of 
their delivery.
    (2) The President should also urgently seek the agreement 
of other nations to adopt and institute, at the earliest 
practicable date, sanctions and controls comparable to those 
the United States is obligated to apply under this subsection.
    (c) Public Identification.--The Congress calls on the 
President to identify publicly (in the report required by 
section 1607) any country or person that transfers goods or 
technology to Iran or Iraq contrary to the policy set forth in 
subsection (a).

SEC. 1603. APPLICATION TO IRAN OF CERTAIN IRAQ SANCTIONS.

    The sanctions against Iraq specified in paragraphs (1) 
through (4) of section 586G(a) of the Iraq Sanctions Act of 
1990 (as contained in Public Law 101-513), including denial of 
export licenses for United States persons and prohibitions on 
United States Government sales, shall be applied to the same 
extent and in the same manner with respect to Iran.

SEC. 1604. SANCTIONS AGAINST CERTAIN PERSONS.

    (a) Prohibition.--If any person transfers or retransfers 
goods or technology so as to contribute knowingly and 
materially to the efforts by Iran or Iraq (or any agency or 
instrumentality of either such country) to acquire chemical, 
biological or nuclear weapons or to acquire destabilizing 
numbers and types of advanced conventional weapons, then the 
sanctions described in subsection (b) shall be imposed.
    (b) Mandatory Sanctions.--The sanctions to be imposed 
pursuant to subsection (a) are as follows.
          (1) Procurement sanction.--For a period of two years, 
        the United States Government shall not procure, or 
        enter into any contract for the procurement of, any 
        goods or services from the sanctioned person.
          (2) Export sanction.--For a period of two years, the 
        United States Government shall not issue any license 
        for any export by or to the sanctioned person.

SEC. 1605. SANCTIONS AGAINST CERTAIN FOREIGN COUNTRIES.

    (a) Prohibition.--If the President determines that the 
government of any foreign country transfers or retransfers 
goods or technology so as to contribute knowingly and 
materially to the efforts by Iran or Iraq (or any agency or 
instrumentality of either such country), to acquire chemical, 
biological or nuclear weapons or to acquire destabilizing 
numbers and types of advanced conventional weapons, then--
          (1) the sanctions described in subsection (b) shall 
        be imposed on such country; and
          (2) in addition, the President may apply, in the 
        discretion of the President, the sanction described in 
        subsection (c).
    (b) Mandatory Sanctions.--Except as provided in paragraph 
(2), the sanctions to be imposed pursuant to subsection (a)(1) 
are as follows:
          (1) Suspension of united states assistance.--The 
        United States Government shall suspend, for a period of 
        one year, United States assistance to the sanctioned 
        country.
          (2) Multilateral development bank assistance.--The 
        Secretary of the Treasury shall instruct the United 
        States Executive Director to each appropriate 
        international financial institution to oppose, and vote 
        against, for a period of one year, the extension by 
        such institution of any loan or financial or technical 
        assistance to the sanctioned country.
          (3) Suspension of codevelopment or coproduction 
        agreements.--The United States shall suspend, for a 
        period of one year, compliance with its obligations 
        under any memorandum of understanding with the 
        sanctioned country for the codevelopment or 
        coproduction of any item on the United States Munitions 
        List (established under section 38 of the arms Export 
        Control Act), including any obligation for 
        implementation of the memorandum of understanding 
        through the sale to the sanctioned country of technical 
        data or assistance or the licensing for export to the 
        sanctioned country of any component part.
          (4) Suspension of military and dual-use technical 
        exchange agreements.--The United States shall suspend, 
        for a period of one year, compliance with its 
        obligations under any technical exchange agreement 
        involving military and dual-use technology between the 
        United States and the sanctioned country that does not 
        directly contribute to the security of the United 
        States, and no military or dual-use technology may be 
        exported from the United States to the sanctioned 
        country pursuant to that agreement during that period.
          (5) United states munitions list.--No item on the 
        United States Munitions List (established pursuant to 
        section 38 of the Arms Export Control Act) may be 
        exported to the sanctioned country for a period of one 
        year.
    (c) Discretionary Sanction.--The sanction referred to in 
subsection (a)(2) is as follows:
          (1) Use of authorities of international emergency 
        economic powers act.--Except as provided in paragraph 
        (2), the President may exercise, in accordance with the 
        provisions of that Act, the authorities of the 
        International Emergency Economic Powers Act with 
        respect to the sanctioned country.
          (2) Exception.--Paragraph (1) does not apply with 
        respect to urgent humanitarian assistance.

SEC. 1606. WAIVER.

    The President may waive the requirement to impose a 
sanction described in section 1603, in the case of Iran, or a 
sanction described in section 1604(b) or 1605(b), in the case 
of Iraq and Iran, 15 days after the President determines and so 
reports to the Committees on Armed Services and Foreign 
Relations of the Senate and the Committees on Armed Services 
and Foreign Affairs of the House of Representatives that it is 
essential to the national interest of the United States to 
exercise such waiver authority. Any such report shall provide a 
specific and detailed rationale for such determination.

SEC. 1607. REPORTING REQUIREMENT.

    (a) Annual Report.--Beginning one year after the date of 
the enactment of this Act, and every 12 months thereafter, the 
President shall submit to the Committees on Armed Services and 
Foreign Relations of the Senate and the Committees on Armed 
Services and Foreign Affairs of the House of Representatives a 
report detailing--
          (1) all transfers or retransfers made by any person 
        or foreign government during the preceding 12-month 
        period which are subject to any sanction under this 
        title; and
          (2) the actions the President intends to under take 
        or has undertaken pursuant to this title with respect 
        to each such transfer.
    (b) Report on Individual Transfers.--Whenever the President 
determines that a person or foreign government has made a 
transfer which is subject to any sanction under this title, the 
President shall, within 30 days after such transfer, submit to 
the Committees on Armed Services and Foreign Relations of the 
Senate and the Committees on Armed Service and Foreign Affairs 
of the House of Representatives a report--
          (1) identifying the person or government and 
        providing the details of the transfer; and
          (2) describing the actions the President intends to 
        undertake or has undertaken under the provisions of 
        this title with respect to each such transfer.
    (c) Form of Transmittal.--Reports required by this section 
may be submitted in classified as well as in unclassified form.

SEC. 1608. DEFINITIONS.

    For purposes of this title:
          (1) The term ``advanced conventional weapons'' 
        includes--
                  (A) such long-range precision-guided 
                munitions, fuel air explosives, cruise 
                missiles, low observability aircraft, other 
                radar evading aircraft, advanced military 
                aircraft, military satellites, electromagnetic 
                weapons, and laser weapons as the President 
                determines destabilize the military balance or 
                enhance offensive capabilities in destabilizing 
                ways;
                  (B) such advanced command, control, and 
                communications systems, electronic warfare 
                systems, or intelligence collection systems as 
                the President determines destabilize the 
                military balance or enhance offensive 
                capabilities in destabilizing ways; and
                  (C) such other items or systems as the 
                President may, by regulation, determine 
                necessary for purposes of this title.
          (2) The term ``cruise missile'' means guided missiles 
        that use aerodynamic lift to offset gravity and 
        propulsion to counteract drag.
          (3) The term ``goods or technology'' means--
                  (A) any article, natural or manmade 
                substance, material, supply, or manufactured 
                product, including inspection and test 
                equipment; and
                  (B) any information and know-how (whether in 
                tangible form, such as models, prototypes, 
                drawings, sketches, diagrams, blueprints, or 
                manuals, or in intangible form, such as 
                training or technical services) that can be 
                used to design, produce, manufacture, utilize, 
                or reconstruct goods, including computer 
                software and technical data.
          (4) The term ``person'' means any United States or 
        foreign individual, partnership, corporation, or other 
        form of association, or any of their successor 
        entities, parents, or subsidiaries.
          (5) The term ``sanctioned country'' means a country 
        against which sanctions are required to be imposed 
        pursuant to section 1605.
          (6) The term ``sanctioned person'' means a person 
        that makes a transfer described in section 1604(a).
          (7) The term ``United States assistance'' means--
                  (A) any assistance under the Foreign 
                Assistance Act of 1961 (22 U.S.C. 2151 et 
                seq.), other than urgent humanitarian 
                assistance or medicine;
                  (B) sales and assistance under the Arms 
                Export Control Act;
                  (C) financing by the Commodity Credit 
                Corporation for export sales of agricultural 
                commodities; and
                  (D) financing under the Export-Import Bank 
                Act.

         Compliance With United Nations Sanctions Against Iraq


             [50 U.S.C. 1701 note; P.L. 104-107, sec. 534]

    Sec. 534. (a) Denial of Assistance.--None of the funds 
appropriated or otherwise made available pursuant to this Act 
to carry out the Foreign Assistance Act of 1961 (including 
title IV of chapter 2 of part I, relating to the Overseas 
Private Investment Corporation) or the Arms Export Control Act 
may be used to provide assistance to any country that is not in 
compliance with the United Nations Security Council sanctions 
against Iraq, Serbia or Montenegro unless the President 
determines and so certifies to the Congress that--
           (1) such assistance is in the national interest of 
        the United States;
           (2) such assistance will directly benefit the needy 
        people in that country; or
           (3) the assistance to be provided will be 
        humanitarian assistance for foreign nationals who have 
        fled Iraq and Kuwait.
  (b) Import Sanctions.--If the President considers that the 
taking of such action would promote the effectiveness of the 
economic sanctions of the United Nations and the United States 
imposed with respect to Iraq, Serbia, or Montenegro, as the 
case may be, and is consistent with the national interest, the 
President may prohibit, for such a period of time as he 
considers appropriate, the importation into the United States 
of any or all products of any foreign country that has not 
prohibited--
           (1) the importation of products of Iraq, Serbia, or 
        Montenegro into its customs territory, and
           (2) the export of its products to Iraq, Serbia, or 
        Montenegro, as the case may be.

                  Iran and Libya Sanctions Act of 1996


                  [50 U.S.C. 1701 note; P.L. 104-172]

SECTION 1. SHORT TITLE.

   This Act may be cited as the ``Iran and Libya Sanctions Act 
of 1996''.

SEC. 2. FINDINGS.

   The Congress makes the following findings:
           (1) The efforts of the Government of Iran to acquire 
        weapons of mass destruction and the means to deliver 
        them and its support of acts of international terrorism 
        endanger the national security and foreign policy 
        interests of the United States and those countries with 
        which the United States shares common strategic and 
        foreign policy objectives.
           (2) The objective of preventing the proliferation of 
        weapons of mass destruction and acts of international 
        terrorism through existing multilateral and bilateral 
        initiatives requires additional efforts to deny Iran 
        the financial means to sustain its nuclear, chemical, 
        biological, and missile weapons programs.
           (3) The Government of Iran uses its diplomatic 
        facilities and quasi-governmental institutions outside 
        of Iran to promote acts of international terrorism and 
        assist its nuclear, chemical, biological, and missile 
        weapons programs.
           (4) The failure of the Government of Libya to comply 
        with Resolutions 731, 748, and 883 of the Security 
        Council of the United Nations, its support of 
        international terrorism, and its efforts to acquire 
        weapons of mass destruction constitute a threat to 
        international peace and security that endangers the 
        national security and foreign policy interests of the 
        United States and those countries with which it shares 
        common strategic and foreign policy objectives.

SEC. 3. DECLARATION OF POLICY.

   (a) Policy with Respect to Iran.--The Congress declares that 
it is the policy of the United States to deny Iran the ability 
to support acts of international terrorism and to fund the 
development and acquisition of weapons of mass destruction and 
the means to deliver them by limiting the development of Iran's 
ability to explore for, extract, refine, or transport by 
pipeline petroleum resources of Iran.
   (b) Policy with Respect to Libya.--The Congress further 
declares that it is the policy of the United States to seek 
full compliance by Libya with its obligations under Resolutions 
731, 748, and 883 of the Security Council of the United 
Nations, including ending all support for acts of international 
terrorism and efforts to develop or acquire weapons of mass 
destruction.

SEC. 4. MULTILATERAL REGIME.

   (a) Multilateral Negotiations.--In order to further the 
objectives of section 3, the Congress urges the President to 
commence immediately diplomatic efforts, both in appropriate 
international fora such as the United Nations, and bilaterally 
with allies of the United States, to establish a multilateral 
sanctions regime against Iran, including provisions limiting 
the development of petroleum resources, that will inhibit 
Iran's efforts to carry out activities described in section 2.
   (b) Reports to Congress.--The President shall report to the 
appropriate congressional committees, not later than 1 year 
after the date of the enactment of this Act, and periodically 
thereafter, on the extent that diplomatic efforts described in 
subsection (a) have been successful. Each report shall 
include--
           (1) the countries that have agreed to undertake 
        measures to further the objectives of section 3 with 
        respect to Iran, and a description of those measures; 
        and
           (2) the countries that have not agreed to measures 
        described in paragraph (1), and, with respect to those 
        countries, other measures (in addition to that provided 
        in subsection (d)) the President recommends that the 
        United States take to further the objectives of section 
        3 with respect to Iran.
   (c) Waiver.--The President may waive the application of 
section 5(a) with respect to nationals of a country if--
           (1) that country has agreed to undertake substantial 
        measures, including economic sanctions, that will 
        inhibit Iran's efforts to carry out activities 
        described in section 2 and information required by 
        subsection (b)(1) has been included in a report 
        submitted under subsection (b); and
           (2) the President, at least 30 days before the 
        waiver takes effect, notifies the appropriate 
        congressional committees of his intention to exercise 
        the waiver.
   (d) Enhanced Sanction.--
           (1) Sanction.--With respect to nationals of 
        countries except those with respect to which the 
        President has exercised the waiver authority of 
        subsection (c), at any time after the first report is 
        required to be submitted under subsection (b), section 
        5(a) shall be applied by substituting ``$20,000,000'' 
        for ``$40,000,000'' each place it appears, and by 
        substituting ``$5,000,000'' for ``$10,000,000''.
           (2) Report to congress.--The President shall report 
        to the appropriate congressional committees any country 
        with respect to which paragraph (1) applies.
   (e) Interim Report on Multilateral Sanctions; Monitoring.--
The President, not later than 90 days after the date of the 
enactment of this Act, shall report to the appropriate 
congressional committees on--
          (1) whether the member states of the European Union, 
        the Republic of Korea, Australia, Israel, or Japan have 
        legislative or administrative standards providing for 
        the imposition of trade sanctions on persons or their 
        affiliates doing business or having investments in Iran 
        or Libya;
          (2) the extent and duration of each instance of the 
        application of such sanctions; and
          (3) the disposition of any decision with respect to 
        such sanctions by the World Trade Organization or its 
        predecessor organization.

SEC. 5. IMPOSITION OF SANCTIONS.

  (a) Sanctions with Respect to Iran.--Except as provided in 
subsection (f), the President shall impose 2 or more of the 
sanctions described in paragraphs (1) through (6) of section 6 
if the President determines that a person has, with actual 
knowledge, on or after the date of the enactment of this Act, 
made an investment of $40,000,000 or more (or any combination 
of investments of at least $10,000,000 each, which in the 
aggregate equals or exceeds $40,000,000 in any 12-month 
period), that directly and significantly contributed to the 
enhancement of Iran's ability to develop petroleum resources of 
Iran.
  (b) Mandatory Sanctions with Respect to Libya.--
          (1) Violations of prohibited transactions.--Except as 
        provided in subsection (f), the President shall impose 
        2 or more of the sanctions described in paragraphs (1) 
        through (6) of section 6 if the President determines 
        that a person has, with actual knowledge, on or after 
        the date of the enactment of this Act, exported, 
        transferred, or otherwise provided to Libya any goods, 
        services, technology, or other items the provision of 
        which is prohibited under paragraph 4(b) or 5 of 
        Resolution 748 of the Security Council of the United 
        Nations, adopted March 31, 1992, or under paragraph 5 
        or 6 of Resolution 883 of the Security Council of the 
        United Nations, adopted November 11, 1993, if the 
        provision of such items significantly and materially--
                   (A) contributed to Libya's ability to 
                acquire chemical, biological, or nuclear 
                weapons or destabilizing numbers and types of 
                advanced conventional weapons or enhanced 
                Libya's military or paramilitary capabilities;
                   (B) contributed to Libya's ability to 
                develop its petroleum resources; or
                   (C) contributed to Libya's ability to 
                maintain its aviation capabilities.
          (2) Investments that contribute to the development of 
        petroleum resources.--Except as provided in subsection 
        (f), the President shall impose 2 or more of the 
        sanctions described in paragraphs (1) through (6) of 
        section 6 if the President determines that a person 
        has, with actual knowledge, on or after the date of the 
        enactment of this Act, made an investment of 
        $40,000,000 or more (or any combination of investments 
        of at least $10,000,000 each, which in the aggregate 
        equals or exceeds $40,000,000 in any 12-month period), 
        that directly and significantly contributed to the 
        enhancement of Libya's ability to develop its petroleum 
        resources.
  (c) Persons Against Which the Sanctions Are To Be Imposed.--
The sanctions described in subsections (a) and (b) shall be 
imposed on--
           (1) any person the President determines has carried 
        out the activities described in subsection (a) or (b); 
        and
           (2) any person the President determines--
                   (A) is a successor entity to the person 
                referred to in paragraph (1);
                   (B) is a parent or subsidiary of the person 
                referred to in paragraph (1) if that parent or 
                subsidiary, with actual knowledge, engaged in 
                the activities referred to in paragraph (1); or
                   (C) is an affiliate of the person referred 
                to in paragraph (1) if that affiliate, with 
                actual knowledge, engaged in the activities 
                referred to in paragraph (1) and if that 
                affiliate is controlled in fact by the person 
                referred to in paragraph (1).
         For purposes of this Act, any person or entity 
        described in this subsection shall be referred to as a 
        ``sanctioned person''.
  (d) Publication in Federal Register.--The President shall 
cause to be published in the Federal Register a current list of 
persons and entities on whom sanctions have been imposed under 
this Act. The removal of persons or entities from, and the 
addition of persons and entities to, the list, shall also be so 
published.
   (e) Publication of Projects.--The President shall cause to 
be published in the Federal Register a list of all significant 
projects which have been publicly tendered in the oil and gas 
sector in Iran.
  (f) Exceptions.--The President shall not be required to apply 
or maintain the sanctions under subsection (a) or (b)--
           (1) in the case of procurement of defense articles 
        or defense services--
                   (A) under existing contracts or 
                subcontracts, including the exercise of options 
                for production quantities to satisfy 
                requirements essential to the national security 
                of the United States;
                   (B) if the President determines in writing 
                that the person to which the sanctions would 
                otherwise be applied is a sole source supplier 
                of the defense articles or services, that the 
                defense articles or services are essential, and 
                that alternative sources are not readily or 
                reasonably available; or
                   (C) if the President determines in writing 
                that such articles or services are essential to 
                the national security under defense 
                coproduction agreements;
          (2) in the case of procurement, to eligible products, 
        as defined in section 308(4) of the Trade Agreements 
        Act of 1979 (19 U.S.C. 2518(4)), of any foreign country 
        or instrumentality designated under section 301(b)(1) 
        of that Act (19 U.S.C. 2511(b)(1));
          (3) to products, technology, or services provided 
        under contracts entered into before the date on which 
        the President publishes in the Federal Register the 
        name of the person on whom the sanctions are to be 
        imposed;
          (4) to--
                  (A) spare parts which are essential to United 
                States products or production;
                  (B) component parts, but not finished 
                products, essential to United States products 
                or production; or
                   (C) routine servicing and maintenance of 
                products, to the extent that alternative 
                sources are not readily or reasonably 
                available;
           (6) \2\ to information and technology essential to 
        United States products or production; or
---------------------------------------------------------------------------
    \2\ There is no subsection (5) in original.
---------------------------------------------------------------------------
           (7) to medicines, medical supplies, or other 
        humanitarian items.

SEC. 6. DESCRIPTION OF SANCTIONS.

   The sanctions to be imposed on a sanctioned person under 
section 5 are as follows:
           (1) Export-import bank assistance for exports to 
        sanctioned persons.--The President may direct the 
        Export-Import Bank of the United States not to give 
        approval to the issuance of any guarantee, insurance, 
        extension of credit, or participation in the extension 
        of credit in connection with the export of any goods or 
        services to any sanctioned person.
           (2) Export sanction.--The President may order the 
        United States Government not to issue any specific 
        license and not to grant any other specific permission 
        or authority to export any goods or technology to a 
        sanctioned person under--
                   (i) the Export Administration Act of 1979;
                  (ii) the Arms Export Control Act;
                  (iii) the Atomic Energy Act of 1954; or
                  (iv) any other statute that requires the 
                prior review and approval of the United States 
                Government as a condition for the export or 
                reexport of goods or services.
           (3) Loans from united states financial 
        institutions.--The United States Government may 
        prohibit any United States financial institution from 
        making loans or providing credits to any sanctioned 
        person totaling more than $10,000,000 in any 12-month 
        period unless such person is engaged in activities to 
        relieve human suffering and the loans or credits are 
        provided for such activities.
           (4) Prohibitions on financial institutions.--The 
        following prohibitions may be imposed against a 
        sanctioned person that is a financial institution:
                   (A) Prohibition on designation as primary 
                dealer.--Neither the Board of Governors of the 
                Federal Reserve System nor the Federal Reserve 
                Bank of New York may designate, or permit the 
                continuation of any prior designation of, such 
                financial institution as a primary dealer in 
                United States Government debt instruments.
                   (B) Prohibition on service as a repository 
                of government funds.--Such financial 
                institution may not serve as agent of the 
                United States Government or serve as repository 
                for United States Government funds. The 
                imposition of either sanction under 
                subparagraph (A) or (B) shall be treated as 1 
                sanction for purposes of section 5, and the 
                imposition of both such sanctions shall be 
                treated as 2 sanctions for purposes of section 
                5.
           (5) Procurement sanction.--The United States 
        Government may not procure, or enter into any contract 
        for the procurement of, any goods or services from a 
        sanctioned person.
           (6) Additional sanctions.--The President may impose 
        sanctions, as appropriate, to restrict imports with 
        respect to a sanctioned person, in accordance with the 
        International Emergency Economic Powers Act (50 U.S.C. 
        1701 and following).

SEC. 7. ADVISORY OPINIONS.

   The Secretary of State may, upon the request of any person, 
issue an advisory opinion to that person as to whether a 
proposed activity by that person would subject that person to 
sanctions under this Act. Any person who relies in good faith 
on such an advisory opinion which states that the proposed 
activity would not subject a person to such sanctions, and any 
person who thereafter engages in such activity, will not be 
made subject to such sanctions on account of such activity.

SEC. 8. TERMINATION OF SANCTIONS.

   (a) Iran.--The requirement under section 5(a) to impose 
sanctions shall no longer have force or effect with respect to 
Iran if the President determines and certifies to the 
appropriate congressional committees that Iran--
           (1) has ceased its efforts to design, develop, 
        manufacture, or acquire--
                   (A) a nuclear explosive device or related 
                materials and technology;
                   (B) chemical and biological weapons; and
                   (C) ballistic missiles and ballistic missile 
                launch technology; and
           (2) has been removed from the list of countries the 
        governments of which have been determined, for purposes 
        of section 6(j) of the Export Administration Act of 
        1979, to have repeatedly provided support for acts of 
        international terrorism.
  (b) Libya.--The requirement under section 5(b) to impose 
sanctions shall no longer have force or effect with respect to 
Libya if the President determines and certifies to the 
appropriate congressional committees that Libya has fulfilled 
the requirements of United Nations Security Council Resolution 
731, adopted January 21, 1992, United Nations Security Council 
Resolution 748, adopted March 31, 1992, and United Nations 
Security Council Resolution 883, adopted November 11, 1993.

SEC. 9. DURATION OF SANCTIONS; PRESIDENTIAL WAIVER.

   (a) Delay of Sanctions.--
           (1) Consultations.--If the President makes a 
        determination described in section 5(a) or 5(b) with 
        respect to a foreign person, the Congress urges the 
        President to initiate consultations immediately with 
        the government with primary jurisdiction over that 
        foreign person with respect to the imposition of 
        sanctions under this Act.
          (2) Actions by government of jurisdiction.--In order 
        to pursue consultations under paragraph (1) with the 
        government concerned, the President may delay 
        imposition of sanctions under this Act for up to 90 
        days. Following such consultations, the President shall 
        immediately impose sanctions unless the President 
        determines and certifies to the Congress that the 
        government has taken specific and effective actions, 
        including, as appropriate, the imposition of 
        appropriate penalties, to terminate the involvement of 
        the foreign person in the activities that resulted in 
        the determination by the President under section 5(a) 
        or 5(b) concerning such person.
           (3) Additional delay in imposition of sanctions.--
        The President may delay the imposition of sanctions for 
        up to an additional 90 days if the President determines 
        and certifies to the Congress that the government with 
        primary jurisdiction over the person concerned is in 
        the process of taking the actions described in 
        paragraph (2).
           (4) Report to congress.--Not later than 90 days 
        after making a determination under section 5(a) or 
        5(b), the President shall submit to the appropriate 
        congressional committees a report on the status of 
        consultations with the appropriate foreign government 
        under this subsection, and the basis for any 
        determination under paragraph (3).
   (b) Duration of Sanctions.--A sanction imposed under section 
5 shall remain in effect--
           (1) for a period of not less than 2 years from the 
        date on which it is imposed; or
           (2) until such time as the President determines and 
        certifies to the Congress that the person whose 
        activities were the basis for imposing the sanction is 
        no longer engaging in such activities and that the 
        President has received reliable assurances that such 
        person will not knowingly engage in such activities in 
        the future, except that such sanction shall remain in 
        effect for a period of at least 1 year.
   (c) Presidential Waiver.--
           (1) Authority.--The President may waive the 
        requirement in section 5 to impose a sanction or 
        sanctions on a person described in section 5(c), and 
        may waive the continued imposition of a sanction or 
        sanctions under subsection (b) of this section, 30 days 
        or more after the President determines and so reports 
        to the appropriate congressional committees that it is 
        important to the national interest of the United States 
        to exercise such waiver authority.
          (2) Contents of report.--Any report under paragraph 
        (1) shall provide a specific and detailed rationale for 
        the determination under paragraph (1), including--
                   (A) a description of the conduct that 
                resulted in the determination under section 
                5(a) or (b), as the case may be;
                   (B) in the case of a foreign person, an 
                explanation of the efforts to secure the 
                cooperation of the government with primary 
                jurisdiction over the sanctioned person to 
                terminate or, as appropriate, penalize the 
                activities that resulted in the determination 
                under section 5(a) or (b), as the case may be;
                   (C) an estimate as to the significance--
                           (i) of the provision of the items 
                        described in section 5(a) to Iran's 
                        ability to develop its petroleum 
                        resources, or
                           (ii) of the provision of the items 
                        described in section 5(b)(1) to the 
                        abilities of Libya described in 
                        subparagraph (A), (B), or (C) of 
                        section 5(b)(1), or of the investment 
                        described in section 5(b)(2) on Libya's 
                        ability to develop its petroleum 
                        resources, as the case may be; and
                   (D) a statement as to the response of the 
                United States in the event that the person 
                concerned engages in other activities that 
                would be subject to section 5(a) or (b).
           (3) Effect of report on waiver.--If the President 
        makes a report under paragraph (1) with respect to a 
        waiver of sanctions on a person described in section 
        5(c), sanctions need not be imposed under section 5(a) 
        or (b) on that person during the 30-day period referred 
        to in paragraph (1).

SEC. 10. REPORTS REQUIRED.

  (a) Report on Certain International Initiatives.--Not later 
than 6 months after the date of the enactment of this Act, and 
every 6 months thereafter, the President shall transmit a 
report to the appropriate congressional committees describing--
           (1) the efforts of the President to mount a 
        multilateral campaign to persuade all countries to 
        pressure Iran to cease its nuclear, chemical, 
        biological, and missile weapons programs and its 
        support of acts of international terrorism;
           (2) the efforts of the President to persuade other 
        governments to ask Iran to reduce the presence of 
        Iranian diplomats and representatives of other 
        government and military or quasi-governmental 
        institutions of Iran and to withdraw any such diplomats 
        or representatives who participated in the takeover of 
        the United States embassy in Tehran on November 4, 
        1979, or the subsequent holding of United States 
        hostages for 444 days;
          (3) the extent to which the International Atomic 
        Energy Agency has established regular inspections of 
        all nuclear facilities in Iran, including those 
        presently under construction; and
          (4) Iran's use of Iranian diplomats and 
        representatives of other government and military or 
        quasi-governmental institutions of Iran to promote acts 
        of international terrorism or to develop or sustain 
        Iran's nuclear, chemical, biological, and missile 
        weapons programs.
   (b) Other Reports.--The President shall ensure the continued 
transmittal to the Congress of reports describing--
           (1) the nuclear and other military capabilities of 
        Iran, as required by section 601(a) of the Nuclear Non-
        Proliferation Act of 1978 and section 1607 of the 
        National Defense Authorization Act for Fiscal Year 
        1993; and
           (2) the support provided by Iran for acts of 
        international terrorism, as part of the Department of 
        State's annual report on international terrorism.

SEC. 11. DETERMINATIONS NOT REVIEWABLE.

   A determination to impose sanctions under this Act shall not 
be reviewable in any court.

SEC. 12. EXCLUSION OF CERTAIN ACTIVITIES.

   Nothing in this Act shall apply to any activities subject to 
the reporting requirements of title V of the National Security 
Act of 1947.

SEC. 13. EFFECTIVE DATE; SUNSET.

   (a) Effective Date.--This Act shall take effect on the date 
of the enactment of this Act.
   (b) Sunset.--This Act shall cease to be effective on the 
date that is 5 years after the date of the enactment of this 
Act.

SEC. 14. DEFINITIONS.

   As used in this Act:
           (1) Act of international terrorism.--The term ``act 
        of international terrorism'' means an act--
                   (A) which is violent or dangerous to human 
                life and that is a violation of the criminal 
                laws of the United States or of any State or 
                that would be a criminal violation if committed 
                within the jurisdiction of the United States or 
                any State; and
                   (B) which appears to be intended--
                           (i) to intimidate or coerce a 
                        civilian population;
                           (ii) to influence the policy of a 
                        government by intimidation or coercion; 
                        or
                           (iii) to affect the conduct of a 
                        government by assassination or 
                        kidnapping.
          (2) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means the 
        Committee on Finance, the Committee on Banking, 
        Housing, and Urban Affairs, and the Committee on 
        Foreign Relations of the Senate and the Committee on 
        Ways and Means, the Committee on Banking and Financial 
        Services, and the Committee on International Relations 
        of the House of Representatives.
          (3) Component part.--The term ``component part'' has 
        the meaning given that term in section 11A(e)(1) of the 
        Export Administration Act of 1979 (50 U.S.C. App. 
        2410a(e)(1)).
           (4) Develop and development.--To ``develop'', or the 
        ``development'' of, petroleum resources means the 
        exploration for, or the extraction, refining, or 
        transportation by pipeline of, petroleum resources.
           (5) Financial institution.--The term ``financial 
        institution'' includes--
                   (A) a depository institution (as defined in 
                section 3(c)(1) of the Federal Deposit 
                Insurance Act), including a branch or agency of 
                a foreign bank (as defined in section 1(b)(7) 
                of the International Banking Act of 1978);
                   (B) a credit union;
                  (C) a securities firm, including a broker or 
                dealer;
                  (D) an insurance company, including an agency 
                or underwriter; and
                  (E) any other company that provides financial 
                services.
           (6) Finished product.--The term ``finished product'' 
        has the meaning given that term in section 11A(e)(2) of 
        the Export Administration Act of 1979 (50 U.S.C. App. 
        2410a(e)(2)).
           (7) Foreign person.--The term ``foreign person'' 
        means--
                   (A) an individual who is not a United States 
                person or an alien lawfully admitted for 
                permanent residence into the United States; or
                   (B) a corporation, partnership, or other 
                nongovernmental entity which is not a United 
                States person.
           (8) Goods and technology.--The terms ``goods'' and 
        ``technology'' have the meanings given those terms in 
        section 16 of the Export Administration Act of 1979 (50 
        U.S.C. App. 2415).
           (9) Investment.--The term ``investment'' means any 
        of the following activities if such activity is 
        undertaken pursuant to an agreement, or pursuant to the 
        exercise of rights under such an agreement, that is 
        entered into with the Government of Iran or a 
        nongovenmental entity in Iran, or with the Government 
        of Libya or a nongovernmental entity in Libya, on or 
        after the date of the enactment of this Act:
                   (A) The entry into a contract that includes 
                responsibility for the development of petroleum 
                resources located in Iran or Libya (as the case 
                may be), or the entry into a contract providing 
                for the general supervision and guarantee of 
                another person's performance of such a 
                contract.
                   (B) The purchase of a share of ownership, 
                including an equity interest, in that 
                development.
                   (C) The entry into a contract providing for 
                the participation in royalties, earnings, or 
                profits in that development, without regard to 
                the form of the participation. The term 
                ``investment'' does not include the entry into, 
                performance, or financing of a contract to sell 
                or purchase goods, services, or technology.
           (10) Iran.--The term ``Iran'' includes any agency or 
        instrumentality of Iran.
           (11) Iranian diplomats and representatives of other 
        government and military or quasi-governmental 
        institutions of iran.--The term ``Iranian diplomats and 
        representatives of other government and military or 
        quasi-governmental institutions of Iran'' includes 
        employees, representatives, or affiliates of Iran's--
                   (A) Foreign Ministry;
                  (B) Ministry of Intelligence and Security;
                   (C) Revolutionary Guard Corps;
                   (D) Crusade for Reconstruction;
                   (E) Qods (Jerusalem) Forces;
                   (F) Interior Ministry;
                   (G) Foundation for the Oppressed and 
                Disabled;
                  (H) Prophet's Foundation;
                   (I) June 5th Foundation;
                   (J) Martyr's Foundation;
                   (K) Islamic Propagation Organization; and
                   (L) Ministry of Islamic Guidance.
          (12) Libya.--The term ``Libya'' includes any agency 
        or instrumentality of Libya.
          (13) Nuclear explosive device.--The term ``nuclear 
        explosive device'' means any device, whether assembled 
        or disassembled, that is designed to produce an 
        instantaneous release of an amount of nuclear energy 
        from special nuclear material (as defined in section 
        11(aa) of the Atomic Energy Act of 1954) that is 
        greater than the amount of energy that would be 
        released from the detonation of one pound of 
        trinitrotoluene (TNT).
           (14) Person.--The term ``person'' means--
                   (A) a natural person;
                   (B) a corporation, business association, 
                partnership, society, trust, any other 
                nongovernmental entity, organization, or group, 
                and any governmental entity operating as a 
                business enterprise; and
                  (C) any successor to any entity described in 
                subparagraph (B).
           (15) Petroleum resources.--The term ``petroleum 
        resources'' includes petroleum and natural gas 
        resources.
          (16) United states or state.--The term ``United 
        States'' or ``State'' means the several States, the 
        District of Columbia, the Commonwealth of Puerto Rico, 
        the Commonwealth of the Northern Mariana Islands, 
        American Samoa, Guam, the United States Virgin Islands, 
        and any other territory or possession of the United 
        States.
          (17) United states person.--The term ``United States 
        person'' means--
                   (A) a natural person who is a citizen of the 
                United States or who owes permanent allegiance 
                to the United States; and
                   (B) a corporation or other legal entity 
                which is organized under the laws of the United 
                States, any State or territory thereof, or the 
                District of Columbia, if natural persons 
                described in subparagraph (A) own, directly or 
                indirectly, more than 50 percent of the 
                outstanding capital stock or other beneficial 
                interest in such legal entity. Speaker of the 
                House of Representatives. Vice President of the 
                United States and President of the Senate.

       Trade Sanctions Reform and Export Enhancement Act of 2000


                  [22 U.S.C. 7201-7209; P.L. 106-387]

SEC. 901. SHORT TITLE.

    This Act may be cited as the ``Trade Sanctions Reform and 
Export Enhancement Act of 2000''.

SEC. 902. DEFINITIONS.

In this title:
    (1) Agricultural commodity.--The term ``agricultural 
commodity'' has the meaning given the term in section 102 of 
the Agricultural Trade Act of 1978 (7 U.S.C. 5602).
    (1) Agricultural program.--The term ``agricultural 
program'' means--
          (A) any program administered under the Agricultural 
        Trade Development and Assistance Act of 1954 (7 U.S.C. 
        1691 et seq.);
          (B) any program administered under section 416 of the 
        Agricultural Act of 1949 (7 U.S.C. 1431);
          (C) any program administered under the Agricultural 
        Trade Act of 1978 (7 U.S.C. 5601 et seq.);
          (D) the dairy export incentive program administered 
        under section 153 of the Food Security Act of 1985 (15 
        U.S.C. 713a 14);
          (E) any commercial export sale of agricultural 
        commodities; or
          (F) any export financing (including credits or credit 
        guarantees) provided by the United States Government 
        for agricultural commodities.
    (3) Joint resolution.--The term ``joint resolution'' 
means--
          (A) in the case of section 903(a)(1), only a joint 
        resolution introduced within 10 session days of 
        Congress after the date on which the report of the 
        President under section 903(a)(1) is received by 
        Congress, the matter after the resolving clause of 
        which is as follows: ``That Congress approves the 
        report of the President pursuant to section 903(a)(1) 
        of the Trade Sanctions Reform and Export Enhancement 
        Act of 2000, transmitted on ______________.'', with the 
        blank completed with the appropriate date; and
          (B) in the case of section 906(1), only a joint 
        resolution introduced within 10 session days of 
        Congress after the date on which the report of the 
        President under section 906(2) is received by Congress, 
        the matter after the resolving clause of which is as 
        follows: ``906(1) of the Trade Sanctions Reform and 
        Export Enhancement Act of 2000, transmitted on 
        ______________.'', with the blank completed with the 
        appropriate date.
    (4) Medical device.--The term ``medical device'' has the 
meaning given the term ``device'' in section 201 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 321).
    (5) Medicine.--The term ``medicine'' has the meaning given 
the term ``drug'' in section 201 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 321).
    (6) Unilateral agricultural sanction.--The term 
``unilateral agricultural sanction'' means any prohibition, 
restriction, or condition on carrying out an agricultural 
program with respect to a foreign country or foreign entity 
that is imposed by the United States for reasons of foreign 
policy or national security, except in a case in which the 
United States imposes the measure pursuant to--
          (A) a multilateral regime and the other member 
        countries of that regime have agreed to impose 
        substantially equivalent measures; or
          (B) a mandatory decision of the United Nations 
        Security Council.
    (7) Unilateral medical sanction.--The term ``unilateral 
medical sanction'' means any prohibition, restriction, or 
condition on exports of, or the provision of assistance 
consisting of, medicine or a medical device with respect to a 
foreign country or foreign entity that is imposed by the United 
States for reasons of foreign policy or national security, 
except in a case in which the United States imposes the measure 
pursuant to--
          (A) a multilateral regime and the other member 
        countries of that regime have agreed to impose 
        substantially equivalent measures; or
          (B) a mandatory decision of the United Nations 
        Security Council.

SEC. 903. EXCEPTIONS.

    (a) New Sanctions.--Except as provided in sections 904 and 
905 and notwithstanding any other provision of law, the 
President may not impose a unilateral agricultural sanction or 
unilateral medical sanction against a foreign country or 
foreign entity, unless--
          (1) not later than 60 days before the sanction is 
        proposed to be imposed, the President submits a report 
        to Congress that--
                  (A) describes the activity proposed to be 
                prohibited, restricted, or conditioned; and
                  (B) describes the actions by the foreign 
                country or foreign entity that justify the 
                sanction; and
          (2) there is enacted into law a joint resolution 
        stating the approval of Congress for the report 
        submitted under paragraph (1).
    (b) Existing Sanctions.--The President shall terminate any 
unilateral agricultural sanction or unilateral medical sanction 
that is in effect as of the date of enactment of this Act.

SEC. 904. EXEMPTIONS.

Section 903 shall not affect any authority or requirement to 
impose (or continue to impose) a sanction referred to in 
section 903--
      (1) against a foreign country or foreign entity--
          (A) pursuant to a declaration of war against the 
        country or entity;
          (B) pursuant to specific statutory authorization for 
        the use of the Armed Forces of the United States 
        against the country or entity;
          (C) against which the Armed Forces of the United 
        States are involved in hostilities; or
          (D) where imminent involvement by the Armed Forces of 
        the United States in hostilities against the country or 
        entity is clearly indicated by the circumstances; or
      (2) to the extent that the sanction would prohibit, 
restrict, or condition the provision or use of any agricultural 
commodity, medicine, or medical device that is--
          (A) controlled on the United States Munitions List 
        established under section 38 of the Arms Export Control 
        Act (22 U.S.C. 2778);
          (B) controlled on any control list established under 
        the Export Administration Act of 1979 or any successor 
        statute (50 U.S.C. App. 2401 et seq.); or
          (C) used to facilitate the development or production 
        of a chemical or biological weapon or weapon of mass 
        destruction.

SEC. 905. TERMINATION OF SANCTIONS.

Any unilateral agricultural sanction or unilateral medical 
sanction that is imposed pursuant to the procedures described 
in section 903(a) shall terminate not later than 2 years after 
the date on which the sanction became effective unless--
      (1) not later than 60 days before the date of termination 
of the sanction, the President submits to Congress a report 
containing--
          (A) the recommendation of the President for the 
        continuation of the sanction for an additional period 
        of not to exceed 2 years; and
          (B) the request of the President for approval by 
        Congress of the recommendation; and
      (2) there is enacted into law a joint resolution stating 
the approval of Congress for the report submitted under 
paragraph (1).

SEC. 906. STATE SPONSORS OF INTERNATIONAL TERRORISM.

    (a) Requirement.--
          (1) In General.--Notwithstanding any other provision 
        of this title (other than section 904), the
                  export of agricultural commodities, medicine, 
                or medical devices to Cuba or to the government 
                of a country that has been determined by the 
                Secretary of State to have repeatedly provided 
                support for acts of international terrorism 
                under section 620A of the Foreign Assistance 
                Act of 1961 (22 U.S.C. 2371), section 6(j)(1) 
                of the Export Administration Act of 1979 (50 
                U.S.C. app. 2405(j)(1)), or section 40(d) of 
                the Arms Export Control Act (22 U.S.C. 
                2780(d)), or to any other entity in such a 
                country, shall only be made pursuant to one-
                year licenses issued by the United States 
                Government for contracts entered into during 
                the one-year period of the license and shipped 
                within the 12-month period beginning on the 
                date of the signing of the contract, except 
                that the requirements of such one-year licenses 
                shall be no more restrictive than license 
                exceptions administered by the Department of 
                Commerce or general license exceptions 
                administered by the Department of the Treasury, 
                except that procedures shall be in place to 
                deny licenses for exports to any entity within 
                such country promoting international terrorism.
          (2) Exception.--Paragraph (1) shall not apply with 
        respect to the export of agricultural commodities, 
        medicine, or medicine, or medical devices to the 
        Government of Syria or to the Government of North 
        Korea.
      (b) Quarterly Reports.--The applicable department or 
agency of the Federal Government shall submit to the 
appropriate congressional committees on a quarterly basis a 
report on any activities undertaken under subsection (a)(1) 
during the preceding calendar quarter.
      (c) Biennial Reports.--Not later than two years after the 
date of enactment of this Act, and every two years thereafter, 
the applicable department or agency of the Federal Government 
shall submit a report to the appropriate congressional 
committees on the operation of the licensing system under this 
section for the preceding two-year period, including--
          (1) the number and types of licenses applied for;
          (2) the number and types of licenses approved;
          (3) the average amount of time elapsed from the date 
        of filing of a license application until the date of 
        its approval;
          (4) the extent to which the licensing procedures were 
        effectively implemented; and
          (5) a description of comments received from 
        interested parties about the extent to which the 
        licensing procedures were effective, after the 
        applicable department or agency holds a public 30-day 
        comment period.

SEC. 907. CONGRESSIONAL PROCEDURES.

      (a) Referral of Report.--A report described in section 
903(a)(1) or 905(1) shall be referred to the appropriate 
committee or committees of the House of Representatives and to 
the appropriate committee or committees of the Senate.
      (b) Referral of Joint Resolution.--
          (1) In general.--A joint resolution introduced in the 
        senate shall be referred to the Committee on Foreign 
        Relations, and a joint resolution introduced in the 
        House of Representatives shall be referred to the 
        Committee on International Relations.
          (2) Reporting date.--A joint resolution referred to 
        in paragraph (1) may not be reported before the eighth 
        session day of Congress after the introduction of the 
        joint resolution.

SEC. 908. PROHIBITION ON UNITED STATES ASSISTANCE AND FINANCING.

      (a) Prohibition on United States Assistance.--
          (1) In general.--Notwithstanding any other provision 
        of law, no United States Government assistance, 
        including United States foreign assistance,
                  United States export assistance, and any 
                United States credit or guarantees shall be 
                available for exports to Cuba or for commercial 
                exports to Iran, Libya, North Korea, or Sudan.
          (2) Rule of construction.--Nothing in paragraph (1) 
        shall be construed to alter, modify, or otherwise 
        affect the provisions of section 109 of the Cuban 
        Liberty and Democratic Solidarity (LIBERTAD) Act of 
        1996 (22 U.S.C. 6039) or any other provision of law 
        relating to Cuba in effect on the day before the date 
        of the enactment of this Act.
          (3) Waiver.--The President may waive the application 
        of paragraph (1) with respect to Iran, Libya, North 
        Korea, and Sudan to the degree the President determines 
        that it is in the national security interest of the 
        United States to do so, or for humanitarian reasons.
      (b) Prohibition on Financing of Agricultural Sales to 
Cuba.--
          (1) In General.--No United States person may provide 
        payment or financing terms for sales of agricultural 
        commodities or products to Cuba or any person in Cuba, 
        except in accordance with the following terms 
        (notwithstanding part 515 of title 31, Code of Federal 
        Regulations, or any other provision of law):
                  (A) Payment of cash in advance.
                  (B) Financing by third country financial 
                institutions (excluding United States persons 
                or Government of Cuba entities), except that 
                such financing may be confirmed or advised by a 
                United States financial institution.
                  Nothing in this paragraph authorizes payment 
                terms or trade financing involving a debit or 
                credit to an account of a person located in 
                Cuba or of the Government of Cuba maintained on 
                the books of a United States depository 
                institution.
          (2) Penalties.--Any private person or entity that 
        violates paragraph (1) shall be subject to the 
        penalties provided in the Trading with the Enemy Act 
        for violations under that Act.
          (3) Administration and Enforcement.--The President 
        shall issue such regulations as are necessary to carry 
        out this section, except that the President, in lieu of 
        issuing new regulations, may apply any regulations in 
        effect on the date of the enactment of this Act, 
        pursuant to the Trading with the Enemy Act, with 
        respect to the conduct prohibited in paragraph (1).
          (4) Definitions.--In this subsection--
                  (A) the term ``financing'' includes any loan 
                or extension of credit;
                  (B) the term ``United States depository 
                institution'' means any entity (including its 
                foreign branches or subsidiaries) organized 
                under the laws of any jurisdiction within the 
                United States, or any agency, office or branch 
                located in the United States of a foreign 
                entity, that is engaged primarily in the 
                business of banking (including a bank, savings 
                bank, savings association, credit union, trust 
                company, or United States bank holding 
                company); and
                  (C) the term ``United States person'' means 
                the Federal Government, any State or local 
                government, or any private person or entity of 
                the United States.

SEC. 909. PROHIBITION ON ADDITIONAL IMPORTS FROM CUBA.

Nothing in this title shall be construed to alter, modify, or 
otherwise affect the provisions of section 515.204 of title 31, 
Code of Federal Regulations, relating to the prohibition on the 
entry into the United States of merchandise that (1) is of 
Cuban origin, (2) is or has been located in or transported from 
or through Cuba, or (3) is made or derived in whole or in part 
of any article which is the growth, produce, or manufacture of 
Cuba.

SEC. 910. REQUIREMENTS RELATING TO CERTAIN TRAVEL-RELATED TRANSACTIONS 
                    WITH CUBA.

      (a) Authorization of Travel Relating to Commercial Sale 
of Agricultural Commodities.--The Secretary of the Treasury 
shall promulgate regulations under which the travel-related 
transactions listed in paragraph (c) of section 515.560 of 
title 31, Code of Federal Regulations, may be authorized on a 
case-by-case basis by a specific license for travel to, from, 
or within Cuba for the commercial export sale of agricultural 
commodities pursuant to the provisions of this title.
      (b) Prohibition on Travel Relating to Tourist 
Avtivities.--
          (1) In General.--Notwithstanding any other provision 
        of law of regulation, the Secretary of the Treasury, or 
        any other Federal official, may not authorize the 
        travel-related transactions listed in paragraph (c) of 
        section 515.560 of title 31, Code of Federal 
        Regulations, either by a general license or on a case-
        by-case basis by a specific license for travel to, from 
        or within Cuba for tourist activities.
          (2) Definition.--In this subsection, the term 
        ``tourist activities'' means any activity with respect 
        to travel to, from, or within Cuba that is not 
        expressly authorized in subsection (a) of this section, 
        in any of paragraphs (1) through (12) of section 
        515.560 of title 31, Code of Federal Regulations, or in 
        any section referred to in any of such paragraphs (1) 
        through (2) (as such sections were in effect on June 1, 
        2000).

SEC. 911. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b), this 
title shall take effect on the date of enactment of this Act, 
and shall apply thereafter in any fiscal year.
    (b) Existing Sanctions.--In the case of any unilateral 
agricultural sanction or unilateral medical sanction that is in 
effect as of the date of enactment of this Act, this title 
shall take effect 120 days after the date of enactment of this 
Act, and shall apply thereafter in any fiscal year.

             G. UNITED STATES-HONG KONG POLICY ACT OF 1992


[22 U.S.C. 5721 et seq., P.L. 102-383 as amended by P.L. 104-107, P.L. 
                       105-206, and P.L. 106-36]

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States-Hong Kong 
Policy Act of 1992''.

SEC. 2. FINDINGS AND DECLARATIONS.

    The Congress makes the following findings and declarations:
          (1) The Congress recognizes that under the 1984 Sino-
        British Joint Declaration:
                  (A) The People's Republic of China and the 
                United Kingdom of Great Britain and Northern 
                Ireland have agreed that the People's Republic 
                of China will resume the exercise of 
                sovereignty over Hong Kong on July 1, 1997. 
                Until that time, the United Kingdom will be 
                responsible for the administration of Hong 
                Kong.
                  (B) The Hong Kong Special Administrative 
                Region of the People's Republic of China, 
                beginning on July 1, 1997, will continue to 
                enjoy a high degree of autonomy on all matters 
                other than defense and foreign affairs.
                  (C) There is provision for implementation of 
                a ``one country, two systems'' policy, under 
                which Hong Kong will retain its current 
                lifestyle and legal, social, and economic 
                systems until at least the year 2047.
                  (D) The legislature of the Hong Kong Special 
                Administrative Region will be constituted by 
                elections, and the provisions of the 
                International Covenant on Civil and Political 
                Rights and the International Covenant on 
                Economic, Social and Cultural Rights, as 
                applied to Hong Kong, shall remain in force.
                  (E) Provision is made for the continuation in 
                force of agreements implemented as of June 30, 
                1997, and for the ability of the Hong Kong 
                Special Administrative Region to conclude new 
                agreements either on its own or with the 
                assistance of the Government of the People's 
                Republic of China.
          (2) The Congress declares its wish to see full 
        implementation of the provisions of the Joint 
        Declaration.
          (3) The President has announced his support for the 
        policies and decisions reflected in the Joint 
        Declaration.
          (4) Hong Kong plays an important role in today's 
        regional and world economy. This role is reflected in 
        strong economic, cultural, and other ties with the 
        United States that give the United States a strong 
        interest in the continued vitality, prosperity, and 
        stability of Hong Kong.
          (5) Support for democratization is a fundamental 
        principle of United States foreign policy. As such, it 
        naturally applies to United States policy toward Hong 
        Kong. This will remain equally true after June 30, 
        1997.
          (6) The human rights of the people of Hong Kong are 
        of great importance to the United States and are 
        directly relevant to United States interests in Hong 
        Kong. A fully successful transition in the exercise of 
        sovereignty over Hong Kong must safeguard human rights 
        in and of themselves. Human rights also serve as a 
        basis for Hong Kong's continued economic prosperity.

SEC. 3. DEFINITIONS.

    For purposes of this Act--
          (1) the term ``Hong Kong'' means, prior to July 1, 
        1997, the British Dependent Territory of Hong Kong, and 
        on and after July 1, 1997, the Hong Kong Special 
        Administrative Region of the People's Republic of 
        China;
          (2) the term ``Joint Declaration'' means the Joint 
        Declaration of the Government of the United Kingdom of 
        Great Britain and Northern Ireland and the Government 
        of the People's Republic of China on the Question of 
        Hong Kong, done at Beijing on December 19, 1984; and
          (3) the term ``laws of the United States'' means 
        provisions of law enacted by the Congress.

                            TITLE I--POLICY


SEC. 101. BILATERAL TIES BETWEEN THE UNITED STATES AND HONG KONG.

    It is the sense of the Congress that the following, which 
are based in part on the relevant provisions of the Joint 
Declaration, should be the policy of the United States with 
respect to its bilateral relationship with Hong Kong:
          (1) The United States should play an active role, 
        before, on, and after July 1, 1997, in maintaining Hong 
        Kong's confidence and prosperity, Hong Kong's role as 
        an international financial center, and the mutually 
        beneficial ties between the people of the United States 
        and the people of Hong Kong.
          (2) The United States should actively seek to 
        establish and expand direct bilateral ties and 
        agreements with Hong Kong in economic, trade, 
        financial, monetary, aviation, shipping, 
        communications, tourism, cultural, sport, and other 
        appropriate areas.
          (3) The United States should seek to maintain, after 
        June 30, 1997, the United States consulate-general in 
        Hong Kong, together with other official and semi-
        official organizations, such as the United States 
        Information Agency American Library.
          (4) The United States should invite Hong Kong to 
        maintain, after June 30, 1997, its official and semi-
        official missions in the United States, such as the 
        Hong Kong Economic & Trade Office, the Office of the 
        Hong Kong Trade Development Council, and the Hong Kong 
        Tourist Association. The United States should invite 
        Hong Kong to open and maintain other official or semi-
        official missions to represent Hong Kong in those areas 
        in which Hong Kong is entitled to maintain relations on 
        its own, including economic, trade, financial, 
        monetary, aviation, shipping, communications, tourism, 
        cultural, and sport areas.
          (5) The United States should recognize passports and 
        travel documents issued after June 30, 1997, by the 
        Hong Kong Special Administrative Region.
          (6) The resumption by the People's Republic of China 
        of the exercise of sovereignty over Hong Kong after 
        June 30, 1997, should not affect treatment of Hong Kong 
        residents who apply for visas to visit or reside 
        permanently in the United States, so long as such 
        treatment is consistent with the Immigration and 
        Nationality Act.

SEC. 102. PARTICIPATION IN MULTILATERAL ORGANIZATIONS, RIGHTS UNDER 
                    INTERNATIONAL AGREEMENTS, AND TRADE STATUS.

    It is the sense of the Congress that the following, which 
are based in part on the relevant provisions of the Joint 
Declaration, should be the policy of the United States with 
respect to Hong Kong after June 30, 1997:
          (1) The United States should support Hong Kong's 
        participation in all appropriate multilateral 
        conferences, agreements, and organizations in which 
        Hong Kong is eligible to participate.
          (2) The United States should continue to fulfill its 
        obligations to Hong Kong under international 
        agreements, so long as Hong Kong reciprocates, 
        regardless of whether the People's Republic of China is 
        a party to the particular international agreement, 
        unless and until such obligations are modified or 
        terminated in accordance with law.
          (3) The United States should respect Hong Kong's 
        status as a separate customs territory, and as a WTO 
        member country (as defined in section 2(10) of the 
        Uruguay Round Agreements Act) whether or not the 
        People's Republic of China participates in the World 
        Trade Organization (as defined in section 2(8) of that 
        Act).

SEC. 103. COMMERCE BETWEEN THE UNITED STATES AND HONG KONG.

    It is the sense of the Congress that the following, which 
are based in part on the relevant provisions of the Joint 
Declaration, are and should continue after June 30, 1997, to be 
the policy of the United States with respect to commerce 
between the United States and Hong Kong:
          (1) The United States should seek to maintain and 
        expand economic and trade relations with Hong Kong and 
        should continue to treat Hong Kong as a separate 
        territory in economic and trade matters, such as import 
        quotas and certificates of origin.
          (2) The United States should continue to negotiate 
        directly with Hong Kong to conclude bilateral economic 
        agreements.
          (3) The United States should continue to treat Hong 
        Kong as a territory which is fully autonomous from the 
        United Kingdom and, after June 30, 1997, should treat 
        Hong Kong as a territory which is fully autonomous from 
        the People's Republic of China with respect to economic 
        and trade matters.
          (4) The United States should continue to grant the 
        products of Hong Kong nondiscriminatory trade treatment 
        by virtue of Hong Kong's membership in the General 
        Agreement on Tariffs and Trade.
          (5) The United States should recognize certificates 
        of origin for manufactured goods issued by the Hong 
        Kong Special Administrative Region.
          (6) The United States should continue to allow the 
        United States dollar to be freely exchanged with the 
        Hong Kong dollar.
          (7) United States businesses should be encouraged to 
        continue to operate in Hong Kong, in accordance with 
        applicable United States and Hong Kong law.
          (8) The United States should continue to support 
        access by Hong Kong to sensitive technologies 
        controlled under the agreement of the Coordinating 
        Committee for Multilateral Export Controls (commonly 
        referred to as ``COCOM'') for so long as the United 
        States is satisfied that such technologies are 
        protected from improper use or export.
          (9) The United States should encourage Hong Kong to 
        continue its efforts to develop a framework which 
        provides adequate protection for intellectual property 
        rights.
          (10) The United States should negotiate a bilateral 
        investment treaty directly with Hong Kong, in 
        consultation with the Government of the People's 
        Republic of China.
          (11) The change in the exercise of sovereignty over 
        Hong Kong should not affect ownership in any property, 
        tangible or intangible, held in the United States by 
        any Hong Kong person.

SEC. 104. TRANSPORTATION.

    It is the sense of the Congress that the following, which 
are based in part on the relevant provisions of the Joint 
Declaration, should be the policy of the United States after 
June 30, 1997, with respect to transportation from Hong Kong:
          (1) Recognizing Hong Kong's position as an 
        international transport center, the United States 
        should continue to recognize ships and airplanes 
        registered in Hong Kong and should negotiate air 
        service agreements directly with Hong Kong.
          (2) The United States should continue to recognize 
        ships registered by Hong Kong.
          (3) United States commercial ships, in accordance 
        with applicable United States and Hong Kong law, should 
        remain free to port in Hong Kong.
          (4) The United States should continue to recognize 
        airplanes registered by Hong Kong in accordance with 
        applicable laws of the People's Republic of China.
          (5) The United States should recognize licenses 
        issued by the Hong Kong to Hong Kong airlines.
          (6) The United States should recognize certificates 
        issued by the Hong Kong to United States air carriers 
        for air service involving travel to, from, or through 
        Hong Kong which does not involve travel to, from, or 
        through other parts of the People's Republic of China.
          (7) The United States should negotiate at the 
        appropriate time directly with the Hong Kong Special 
        Administrative Region, acting under authorization from 
        the Government of the People's Republic of China, to 
        renew or amend all air service agreements existing on 
        June 30, 1997, and to conclude new air service 
        agreements affecting all flights to, from, or through 
        the Hong Kong Special Administrative Region which do 
        not involve travel to, from, or through other parts of 
        the People's Republic of China.
          (8) The United States should make every effort to 
        ensure that thenegotiations described in paragraph (7) 
        lead to procompetitive air service agreements.

SEC. 105. CULTURAL AND EDUCATIONAL EXCHANGES.

    It is the sense of the Congress that the following, which 
are based in part on the relevant provisions of the Joint 
Declaration, are and should continue after June 30, 1997, to be 
the policy of the United States with respect to cultural and 
educational exchanges with Hong Kong:
          (1) The United States should seek to maintain and 
        expand United States-Hong Kong relations and exchanges 
        in culture, education, science, and academic research. 
        The United States should encourage American 
        participation in bilateral exchanges with Hong Kong, 
        both official and unofficial.
          (2) The United States should actively seek to further 
        United States-Hong Kong cultural relations and promote 
        bilateral exchanges, including the negotiating and 
        concluding of appropriate agreements in these matters.
          (3) Hong Kong should be accorded separate status as a 
        full partner under the Fulbright Academic Exchange 
        Program (apart from the United Kingdom before July 1, 
        1997, and apart from the People's Republic of China 
        thereafter), with the continuation or establishment of 
        a Fulbright Commission or functionally equivalent 
        mechanism.
          (4) The United States should actively encourage Hong 
        Kong residents to visit the United States on 
        nonimmigrant visas for such purposes as business, 
        tourism, education, and scientific and academic 
        research, in accordance with applicable United States 
        and Hong Kong laws.
          (5) Upon the request of the Legislative Council of 
        Hong Kong, the Librarian of Congress, acting through 
        the Congressional Research Service, should seek to 
        expand educational and informational ties with the 
        Council.

         TITLE II--THE STATUS OF HONG KONG IN UNITED STATES LAW


SEC. 201. CONTINUED APPLICATION OF UNITED STATES LAW.

  (a) In General.--Notwithstanding any change in the exercise 
of sovereignty over Hong Kong, the laws of the United States 
shall continue to apply with respect to Hong Kong, on and after 
July 1, 1997, in the same manner as the laws of the United 
States were applied with respect to Hong Kong before such date 
unless otherwise expressly provided by law or by Executive 
order under section 202.
  (b) International Agreements.--For all purposes, including 
actions in any court in the United States, the Congress 
approves the continuation in force on and after July 1, 1997, 
of all treaties and other international agreements, including 
multilateral conventions, entered into before such date between 
the United States and Hong Kong, or entered into before such 
date between the United States and the United Kingdom and 
applied to Hong Kong, unless or until terminated in accordance 
with law. If in carrying out this title, the President 
determines that Hong Kong is not legally competent to carry out 
its obligations under any such treaty or other international 
agreement, or that the continuation of Hong Kong's obligations 
or rights under any such treaty or other international 
agreement is not appropriate under the circumstances, such 
determination shall be reported to the Congress in accordance 
with section 301.

SEC. 202. PRESIDENTIAL ORDER.

  (a) Presidential Determination.--On or after July 1, 1997, 
whenever the President determines that Hong Kong is not 
sufficiently autonomous to justify treatment under a particular 
law of the United States, or any provision thereof, different 
from that accorded the People's Republic of China, the 
President may issue an Executive order suspending the 
application of section 201(a) to such law or provision of law.
  (b) Factor for Consideration.--In making a determination 
under subsection (a) with respect to the application of a law 
of the United States, or any provision thereof, to Hong Kong, 
the President should consider the terms, obligations, and 
expectations expressed in the Joint Declaration with respect to 
Hong Kong.
  (c) Publication in Federal Register.--Any Executive order 
issued under subsection (a) shall be published in the Federal 
Register and shall specify the law or provision of law affected 
by the order.
  (d) Termination of Suspension.--An Executive order issued 
under subsection (a) may be terminated by the President with 
respect to a particular law or provision of law whenever the 
President determines that Hong Kong has regained sufficient 
autonomy to justify different treatment under the law or 
provision of law in question. Notice of any such termination 
shall be published in the Federal Register.

SEC. 203. RULES AND REGULATIONS.

    The President is authorized to prescribe such rules and 
regulations as thePresident may deem appropriate to carry out 
this Act.

SEC. 204. CONSULTATION WITH CONGRESS.

    In carrying out this title, the President shall consult 
appropriately with the Congress.

                     TITLE III--REPORTING PROVISIONS


SEC. 301. REPORTING REQUIREMENT.

    Not later than March 31, 1993, March 31, 1995, March 31, 
1996, March 31, 1997, March 31, 1998, March 31, 1999, and March 
31, 2000, the Secretary of State shall transmit to the Speaker 
of the House of Representatives and the chairman of the 
Committee on Foreign Relations of the Senate a report on 
conditions in Hong Kong of interest to the United States. This 
report shall cover (in the case of the initial report) the 
period since the date of enactment of this Act or (in the case 
of subsequent reports) the period since the most recent report 
pursuant to this section and shall describe--
          (1) significant developments in United States 
        relations with Hong Kong, including a description of 
        agreements that have entered into force between the 
        United States and Hong Kong;
          (2) other matters, including developments related to 
        the change in the exercise of sovereignty over Hong 
        Kong, affecting United States interests in Hong Kong or 
        United States relations with Hong Kong;
          (3) the nature and extent of United States-Hong Kong 
        cultural, education, scientific, and academic 
        exchanges, both official and unofficial;
          (4) the laws of the United States with respect to 
        which the application of section 201(a) has been 
        suspended pursuant to section 202(a) or with respect to 
        which such a suspension has been terminated pursuant to 
        section 202(d), and the reasons for the suspension or 
        termination, as the case may be;
          (5) treaties and other international agreements with 
        respect to which the President has made a determination 
        described in the last sentence of section 201(b), and 
        the reasons for each such determination;
          (6) significant problems in cooperation between Hong 
        Kong and the United States in the area of export 
        controls;
          (7) the development of democratic institutions in 
        Hong Kong; and
          (8) the nature and extent of Hong Kong's 
        participation in multilateral forums.

SEC. 302. SEPARATE PART OF COUNTRY REPORTS.

    Whenever a report is transmitted to the Congress on a 
country-by-country basis there shall be included in such 
report, where applicable, a separate subreport on Hong Kong 
under the heading of the state that exercises sovereignty over 
Hong Kong. The reports to which this section applies include 
the reports transmitted under--
          (1) sections 116(d) and 502B(b) of the Foreign 
        Assistance Act of 1961 (relating to human rights);
          (2) section 181 of the Trade Act of 1974 (relating to 
        trade barriers); and
          (3) section 2202 of the Export Enhancement Act of 
        1988 (relating to economic policy and trade practices).

     H. RESTRICTIONS ON TRANSPORT OF MERCHANDISE BY FOREIGN VESSELS


        Section 27 of the Merchant Marine Act, 1920, as amended


 [46 App. U.S.C. 883; P.L. 95-410, section 213, as amended by P.L. 96-
112, P.L. 97-31, P.L. 97-389, P.L. 100-239, P.L. 100-329, and P.L. 104-
                                  324]

SEC. 27. TRANSPORTATION OF MERCHANDISE BETWEEN POINTS IN UNITED STATES 
                    IN OTHER THAN DOMESTIC-BUILT OR REBUILT AND 
                    DOCUMENTED VESSELS.

    No merchandise shall be transported by water, or by land 
and water, on penalty of forfeiture of the merchandise (or a 
monetary amount up to the value thereof as determined by the 
Secretary of the Treasury, or the actual cost of the 
transportation, whichever is greater, to be recovered from any 
consignor, seller, owner, importer, consignee, agent, or other 
person or persons so transporting or causing said merchandise 
to be transported), between points in the United States, 
including Districts, Territories, and possessions thereof 
embraced within the coastwise laws, either directly or via a 
foreign port, or for any part of the transportation, in any 
other vessel than a vessel built in and documented under the 
laws of the United States and owned by persons who are citizens 
of the United States, or vessels to which the privilege of 
engaging in the coastwise trade is extended by section 13 or 
808 of this title: Provided, That no vessel ``of more than 200 
gross tons (as measured under chapter 143 of title 46, United 
States Code) having at any time acquired the lawful right to 
engage in the coastwise trade, either by virtue of having been 
built in, or documented under the laws of the United States, 
and later sold foreign in whole or in part, or placed under 
foreign registry, shall hereafter acquire the right to engage 
in the coastwise trade: Provided further, That no vessel which 
has acquired the lawful right to engage in the coastwise trade, 
by virtue of having been built in or documented under the laws 
of the United States, and which has later been rebuilt, shall 
have the right thereafter to engage in the coastwise trade, 
unless the entire rebuilding, including the construction of any 
major components of the hull or superstructure of the vessel, 
is effected within the United States, its Territories (not 
including trust territories), or its possessions: Provided 
further, That this section shall not apply to merchandise 
transported between points within the continental United 
States, including Alaska, over through routes heretofore or 
hereafter recognized by the Surface Transportation Board for 
which routes rate tariffs have been or shall hereafter be filed 
with the Board when such routes are in part over Canadian rail 
lines and their own or other connecting water facilities: 
Provided further, That this section shall not become effective 
upon the Yukon River until the Alaska Railroad shall be 
completed and the Secretary of Transportation shall find that 
proper facilities will be furnished for transportation by 
persons citizens of the United States for properly handling the 
traffic: Provided further, That this section shall not apply to 
the transportation of merchandise loaded on railroad cars or to 
motor vehicles with or without trailers, and with their 
passengers or contents when accompanied by the operator 
thereof, when such railroad cars or motor vehicles are 
transported in any railroad car ferry operated between fixed 
termini on the Great Lakes as a part of a rail route, if such 
car ferry is owned by a common carrier by water and operated as 
part of a rail route with the approval of the Surface 
Transportation Board, and if the stock of such common carrier 
by water, or its predecessor, was owned or controlled by a 
common carrier by rail prior to June 5, 1920, and if the stock 
of the common carrier owning such car ferry is, with the 
approval of the Board, now owned or controlled by any common 
carrier by rail and if such car ferry is built in and 
documented under the laws of the United States: Provided 
further, That upon such terms and conditions as the Secretary 
of the Treasury by regulation may prescribe, and, if the 
transporting vessel is of foreign registry, upon a finding by 
the Secretary of the Treasury, pursuant to information obtained 
and furnished by the Secretary of State, that the government of 
the nation of registry extends reciprocal privileges to vessels 
of the United States, this section shall not apply to the 
transportation by vessels of the United States not qualified to 
engage in the coastwise trade, or by vessels of foreign 
registry, of (a) empty cargo vans, empty lift vans, and empty 
shipping tanks, (b) equipment for use with cargo vans, lift 
vans, or shipping tanks, (c) empty barges specifically designed 
for carriage aboard a vessel and equipment, excluding 
propulsion equipment, for use with such barges, and (d) any 
empty instrument for international traffic exempted from 
application of the customs laws by the Secretary of the 
Treasury pursuant to the provisions of section 1322(a) of Title 
19, if the articles described in clauses (a) through (d) are 
owned or leased by the owner or operator of the transporting 
vessel and are transported for his use in handling his cargo in 
foreign trade; and (e) stevedoring equipment and material, if 
such equipment and material is owned or leased by the owner or 
operator of the transporting vessel, or is owned or leased by 
the stevedoring company contracting for the lading or unlading 
of that vessel, and is transported without charge for use in 
the handling of cargo in foreign trade: Provided further, That 
upon such terms and conditions as the Secretary of the Treasury 
by regulation may prescribe, and, if the transporting vessel is 
of foreign registry, upon his finding, pursuant to information 
furnished by the Secretary of State, that the government of the 
nation of registry extends reciprocal privileges to vessels of 
the United States, the Secretary of the Treasury may suspend 
the application of this section to the transportation of 
merchandise between points in the United States (excluding 
transportation between the continental United States and 
noncontiguous states, districts, territories, and possessions 
embraced within the coastwise laws) which, while moving in the 
foreign trade of the United States, is transferred from a non-
self-propelled barge certified by the owner or operator to be 
specifically designed for carriage aboard a vessel and 
regularly carried aboard a vessel in foreign trade to another 
such barge owned or leased by the same owner or operator, 
without regard to whether any such barge is under foreign 
registry or qualified to engage in the coastwise trade: 
Provided further, That until April 1, 1984, and notwithstanding 
any other provisions of this section, any vessel documented 
under the laws of the United States and owned by persons who 
are citizens of the United States may, when operated upon a 
voyage in foreign trade, transport merchandise in cargo vans, 
lift vans, and shipping-tanks between points embraced within 
the coastwise laws for transfer to or when transferred from 
another vessel or vessels, so documented and owned, of the same 
operator when the merchandise movement has either a foreign 
origin or a foreign destination; but this proviso (1) shall 
apply only to vessels which that same operator owned, chartered 
or contracted for the construction of prior to November 16, 
1979, and (2) shall not apply to movements between points in 
the contiguous United States and points in Hawaii, Alaska, the 
Commonwealth of Puerto Rico and United States territories and 
possessions. For the purposes of this section, after December 
31, 1983, or after such time as an appropriate vessel has been 
constructed and documented as a vessel of the United States, 
the transportation of hazardous waste, as defined in section 
6903(5) of Title 42, from a point in the United States for the 
purpose of the incineration at sea of that waste shall be 
deemed to be transportation by water of merchandise between 
points in the United States: Provided, however, That the 
provisions of this sentence shall not apply to this 
transportation when performed by a foreign-flag ocean 
incineration vessel, owned by or under construction on May 1, 
1982, for a corporation wholly owned by a citizen of the United 
States; the term ``citizen of the United States'', as used in 
this proviso, means a corporation as defined in section 802(a) 
and (b) of this title. The incineration equipment on these 
vessels shall meet all current United States Coast Guard and 
Environmental Protection Agency standards. These vessels shall, 
in addition to any other inspections by the flag state, be 
inspected by the United States Coast Guard, including drydock 
inspections and internal examinations of tanks and void spaces, 
as would be required of a vessel of the United States. 
Satisfactory inspection shall be certified in writing by the 
Secretary of Transportation. Such inspections may occur 
concurrently with any inspections required by the flag state or 
subsequent to but no more than one year after the initial 
issuance or the next scheduled issuance of the Safety of Life 
at Sea Safety Construction Certificate. In making such 
inspections, the Coast Guard shall refer to the conditions 
established by the initial flag state certification as the 
basis for evaluating the current condition of the hull and 
superstructure. The Coast Guard shall allow the substitution of 
an equivalent fitting, material, appliance, apparatus, or 
equipment other than that required for vessels of the United 
States if the Coast Guard has been satisfied that fitting, 
material, appliance, apparatus, or equipment is at least as 
effective as that required for vessels of the United States: 
Provided further, That for the purposes of this section, 
supplies aboard United States documented fish processing 
vessels, which are necessary and used for the processing or 
assembling of fishery products aboard such vessels, shall be 
considered ship's equipment and not merchandise: Provided 
further, That for purposes of this section, the term 
``merchandise'' includes valueless material: Provided further, 
That this section applies to the transportation of valueless 
material or any dredged material regardless of whether it has 
commercial value, from a point or place in the United States or 
a point or place on the high seas within the Exclusive Economic 
Zone as defined in the Presidential Proclamation of March 10, 
1983, to another point or place in the United States or a point 
or place on the high seas within that Exclusive Economic Zone: 
Provided further, That the transportation of any platform 
jacket in or on a launch barge between two points in the United 
States, at one of which there is an installation or other 
device within the meaning of section 1333(a) of Title 43, shall 
not be deemed transportation subject to this section if the 
launch barge has a launch capacity of 12,000 long tons or more, 
was built as of June 7, 1988, and is documented under the laws 
of the United States, and the platform jacket cannot be 
transported on and launched from a launch barge of lesser 
launch capacity that is identified by the Secretary of 
Transportation and is available for such transportation.

  I. AUTHORITY TO REVIEW CERTAIN MERGERS, ACQUISITIONS, AND TAKEOVERS


     Section 721 of the Defense Production Act of 1950, as amended


[50 U.S.C. App. 2170; P.L. 81-774, as added by P.L. 100-418, sec. 5021, 
     and amended by P.L. 102-558, sec. 163, and P.L. 103-359, sec. 
                             721(k)(1)(B)]

    Sec. 721. (a) Investigations.--The President or the 
President's designee may make an investigation to determine the 
effects on national security of mergers, acquisitions, and 
takeovers proposed or pending on or after the date of enactment 
of this section by or with foreign persons which could result 
in foreign control of persons engaged in interstate commerce in 
the United States. If it is determined that an investigation 
should be undertaken, it shall commence no later than 30 days 
after receipt by the President or the President's designee of 
written notification of the proposed or pending merger, 
acquisition, or takeover as prescribed by regulations 
promulgated pursuant to this section. Such investigation shall 
be completed no later than 45 days after such determination.
    (b) Confidentiality of Information.--Any information or 
documentary material filed with the President or the 
President's designee pursuant to this section shall be exempt 
from disclosure under section 552 of title 5, United States 
Code, and no such information or documentary material may be 
made public, except as may be relevant to any administrative or 
judicial action or proceeding. Nothing in this subsection shall 
be construed to prevent disclosure to either House of Congress 
or to any duly authorized committee or subcommittee of the 
Congress.
    (c) Action by the President.--Subject to subsection (d), 
the President may take such action for such time as the 
President considers appropriate to suspend or prohibit any 
acquisition, merger, or takeover, of a person engaged in 
interstate commerce in the United States proposed or pending on 
or after the date of enactment of this section by or with 
foreign persons so that such control will not threaten to 
impair the national security. The President shall announce the 
decision to take action pursuant to this subsection not later 
than 15 days after the investigation described in subsection 
(a) is completed. The President may direct the Attorney General 
to seek appropriate relief, including divestment relief, in the 
district courts of the United States in order to implement and 
enforce this section.
    (d) Findings of the President.--The President may exercise 
the authority conferred by subsection (c) only if the President 
finds that--
          (1) there is credible evidence that leads the 
        President to believe that the foreign interest 
        exercising control might take action that threatens to 
        impair the national security, and
          (2) provisions of law, other than this section and 
        the International Emergency Economic Powers Act (50 
        U.S.C. 1701-1706), do not in the President's judgment 
        provide adequate and appropriate authority for the 
        President to protect the national security in the 
        matter before the President.
The provisions of subsection (d) of this section shall not be 
subject to judicial review.
    (e) Factors To Be Considered.--For purposes of this 
section, the President or the President's designee may, taking 
into account the requirements of national security, consider 
among other factors--
          (1) domestic production needed for projected national 
        defense requirements,
          (2) the capability and capacity of domestic 
        industries to meet national defense requirements, 
        including the availability of human resources, 
        products, technology, materials, and other supplies and 
        services, and
          (3) the control of domestic industries and commercial 
        activity by foreign citizens as it affects the 
        capability and capacity of the United States to meet 
        the requirements of national security.
    (f) Report to the Congress.--If the President determines to 
take action under subsection (c), the President shall 
immediately transmit to the Secretary of the Senate and the 
Clerk of the House of Representatives a written report of the 
action which the President intends to take, including a 
detailed explanation of the findings made under subsection (d).
    (g) Regulations.--The President shall direct the issuance 
of regulations to carry out this section. Such regulations 
shall, to the extent possible, minimize paperwork burdens and 
shall to the extent possible coordinate reporting requirements 
under this section with reporting requirements under any other 
provision of Federal law.
    (h) Effect on Other Law.--Nothing in this section shall be 
construed to alter or affect any existing power, process, 
regulation, investigation, enforcement measure, or review 
provided by any other provision of law.
    (k) Quadrennial Report.--
          (1) In general.--In order to assist the Congress in 
        its oversight responsibilities with respect to this 
        section, the President and such agencies as the 
        President shall designate shall complete and furnish to 
        the Congress, not later than 1 year after the date of 
        enactment of this section and upon the expiration of 
        every 4 years thereafter, a report which--
                  (A) evaluates whether there is credible 
                evidence of a coordinated strategy by 1 or more 
                countries or companies to acquire United States 
                companies involved in research, development, or 
                production of critical technologies for which 
                the United States is a leading producer; and
                  (B) evaluates whether there are industrial 
                espionage activities directed or directly 
                assisted by foreign governments against private 
                United States companies aimed at obtaining 
                commercial secrets related to critical 
                technologies.
          (2) Definition.--For the purposes of this subsection, 
        the term ``critical technologies'' means technologies 
        identified under title VI of the National Science and 
        Technology Policy, Organization, and Priorities Act of 
        1976 or other critical technology, critical components, 
        or critical technology items essential to national 
        defense identified pursuant to this section.
          (3) Release of unclassified study.--The report 
        required by this subsection may be classified. An 
        unclassified version of the report shall be made 
        available to the public.
                Chapter 13: RECIPROCAL TRADE AGREEMENTS

                     A. U.S. NEGOTIATING OBJECTIVES

   Section 1101 of the Omnibus Trade and Competitiveness Act of 1988

                     [19 U.S.C. 2901; P.L. 100-418]

SEC. 1101. OVERALL AND PRINCIPAL TRADE NEGOTIATING OBJECTIVES OF THE 
                    UNITED STATES.

  (a) Overall Trade Negotiating Objectives.--The overall trade 
negotiating objectives of the United States are to obtain--
          (1) more open, equitable, and reciprocal market 
        access;
          (2) the reduction or elimination of barriers and 
        other trade-distorting policies and practices; and
          (3) a more effective system of international trading 
        disciplines and procedures.
  (b) Principal Trade Negotiating Objectives.--
          (1) Dispute settlement.--The principal negotiating 
        objectives of the United States with respect to dispute 
        settlement are--
                  (A) to provide for more effective and 
                expeditious dispute settlement mechanisms and 
                procedures; and
                  (B) to ensure that such mechanisms within the 
                GATT and GATT agreements provide for more 
                effective and expeditious resolution of 
                disputes and enable better enforcement of 
                United States rights.
          (2) Improvement of the gatt and multilateral trade 
        negotiation agreements.--The principal negotiating 
        objectives of the United States regarding the 
        improvement of GATT and multilateral trade negotiation 
        agreements are--
                  (A) to enhance the status of the GATT;
                  (B) to improve the operation and extend the 
                coverage of the GATT and such agreements and 
                arrangements to products, sectors, and 
                conditions of trade not adequately covered; and
                  (C) to expand country participation in 
                particular agreements or arrangements, where 
                appropriate.
          (3) Transparency.--The principal negotiating 
        objective of the United States regarding transparency 
        is to obtain broader application of the principle of 
        transparency and clarification of the costs and 
        benefits of trade policy actions through the observance 
        of open and equitable procedures in trade matters by 
        Contracting Parties to the GATT.
          (4) Developing countries.--The principal negotiating 
        objectives of the United States regarding developing 
        countries are--
                  (A) to ensure that developing countries 
                promote economic development by assuming the 
                fullest possible measure of responsibility for 
                achieving and maintaining an open international 
                trading system by providing reciprocal benefits 
                and assuming equivalent obligations with 
                respect to their import and export practices; 
                and
                  (B) to establish procedures for reducing 
                nonreciprocal trade benefits for the more 
                advanced developing countries.
          (5) Current account surpluses.--The principal 
        negotiating objective of the United States regarding 
        current account surpluses is to develop rules to 
        address large and persistent global current account 
        imbalances of countries, including imbalances which 
        threaten the stability of the international trading 
        system, by imposing greater responsibility on such 
        countries to undertake policy changes aimed at 
        restoring current account equilibrium, including 
        expedited implementation of trade agreements where 
        feasible and appropriate.
          (6) Trade and monetary coordination.--The principal 
        negotiating objective of the United States regarding 
        trade and monetary coordination is to develop 
        mechanisms to assure greater coordination, consistency, 
        and cooperation between international trade and 
        monetary systems and institutions.
          (7) Agriculture.--The principal negotiating 
        objectives of the United States with respect to 
        agriculture are to achieve, on an expedited basis to 
        the maximum extent feasible, more open and fair 
        conditions of trade in agricultural commodities by--
                  (A) developing, strengthening, and clarifying 
                rules for agricultural trade, including 
                disciplines on restrictive or trade-distorting 
                import and export practices;
                  (B) increasing United States agricultural 
                exports by eliminating barriers to trade 
                (including transparent and nontransparent 
                barriers) and reducing or eliminating the 
                subsidization of agricultural production 
                consistent with the United States policy of 
                agricultural stabilization in cyclical and 
                unpredictable markets;
                  (C) creating a free and more open world 
                agricultural trading system by resolving 
                questions pertaining to export and other trade-
                distorting subsidies, market pricing and market 
                access and eliminating and reducing 
                substantially other specific constraints to 
                fair trade and more open market access, such as 
                tariffs, quotas, and other nontariff practices, 
                including unjustified phytosanitary and 
                sanitary restrictions; and
                  (D) seeking agreements by which the major 
                agricultural exporting nations agree to pursue 
                policies to reduce excessive production of 
                agricultural commodities during periods of 
                oversupply, with due regard for the fact that 
                the United States already undertakes such 
                policies, and without recourse to arbitrary 
                schemes to divide market shares among major 
                exporting countries.
          (8) Unfair trade practices.--The principal 
        negotiating objectives of the United States with 
        respect to unfair trade practices are--
                  (A) to improve the provisions of the GATT and 
                nontariff measure agreements in order to 
                define, deter, discourage the persistent use 
                of, and otherwise discipline unfair trade 
                practices having adverse trade effects, 
                including forms of subsidy and dumping and 
                other practices not adequately covered such as 
                resource input subsidies, diversionary dumping, 
                dumped or subsidized inputs, and export 
                targeting practices;
                  (B) to obtain the application of similar 
                rules to the treatment of primary and 
                nonprimary products in the Agreement on 
                Interpretation and Application of Articles VI, 
                XVI, and XXIII of the GATT (relating to 
                subsidies and countervailing measures); and
                  (C) to obtain the enforcement of GATT rules 
                against--
                          (i) state trading enterprises, and
                          (ii) the acts, practices, or policies 
                        of any foreign government which, as a 
                        practical matter, unreasonably require 
                        that--
                                  (I) substantial direct 
                                investment in the foreign 
                                country be made,
                                  (II) intellectual property be 
                                licensed to the foreign country 
                                or to any firm of the foreign 
                                country, or
                                  (III) other collateral 
                                concessions be made,
                        as a condition for the importation of 
                        any product or service of the United 
                        States into the foreign country or as a 
                        condition for carrying on business in 
                        the foreign country.
          (9) Trade in services.--
                  (A) The principal negotiating objectives of 
                the United States regarding trade in services 
                are--
                          (i) to reduce or to eliminate 
                        barriers to, or other distortions of, 
                        international trade in services, 
                        including barriers that deny national 
                        treatment and restrictions on 
                        establishment and operation in such 
                        markets; and
                          (ii) to develop internationally 
                        agreed rules, including dispute 
                        settlement procedures, which--
                                  (I) are consistent with the 
                                commercial policies of the 
                                United States, and
                                  (II) will reduce or eliminate 
                                such barriers or distortions, 
                                and help ensure fair, equitable 
                                opportunities for foreign 
                                markets.
                  (B) In pursuing the negotiating objectives 
                described in subparagraph (A), United States 
                negotiators shall take into account legitimate 
                United States domestic objectives including, 
                but not limited to, the protection of 
                legitimate health or safety, essential 
                security, environmental, consumer or employment 
                opportunity interests and the law and 
                regulations related thereto.
          (10) Intellectual property.--The principal 
        negotiating objectives of the United States regarding 
        intellectual property are--
                  (A) to seek the enactment and effective 
                enforcement by foreign countries of laws 
                which--
                          (i) recognize and adequately protect 
                        intellectual property, including 
                        copyrights, patents, trademarks, 
                        semiconductor chip layout designs, and 
                        trade secrets, and
                          (ii) provide protection against 
                        unfair competition,
                  (B) to establish in the GATT obligations--
                          (i) to implement adequate substantive 
                        standards based on--
                                  (I) the standards in existing 
                                international agreements that 
                                provide adequate protection, 
                                and
                                  (II) the standards in 
                                national laws if international 
                                agreement standards are 
                                inadequate or do not exist,
                          (ii) to establish effective 
                        procedures to enforce, both internally 
                        and at the border, the standards 
                        implemented under clause (i), and
                          (iii) to implement effective dispute 
                        settlement procedures that improve on 
                        existing GATT procedures;
                  (C) to recognize that the inclusion in the 
                GATT of--
                          (i) adequate and effective 
                        substantive norms and standards for the 
                        protection and enforcement of 
                        intellectual property rights, and
                          (ii) dispute settlement provisions 
                        and enforcement procedures,
                is without prejudice to other complementary 
                initiatives undertaken in other international 
                organizations; and
                  (D) to supplement and strengthen standards 
                for protection and enforcement in existing 
                international intellectual property conventions 
                administered by other international 
                organizations, including their expansion to 
                cover new and emerging technologies and 
                elimination of discrimination or unreasonable 
                exceptions or preconditions to protection.
          (11) Foreign direct investment.--
                  (A) The principal negotiating objectives of 
                the United States regarding foreign direct 
                investment are--
                          (i) to reduce or to eliminate 
                        artificial or trade-distorting barriers 
                        to foreign direct investment, to expand 
                        the principle of national treatment, 
                        and to reduce unreasonable barriers to 
                        establishment; and
                          (ii) to develop internationally 
                        agreed rules, including dispute 
                        settlement procedures, which--
                                  (I) will help ensure a free 
                                flow of foreign direct 
                                investment, and
                                  (II) will reduce or eliminate 
                                the trade distortive effects of 
                                certain trade-related 
                                investment measures.
                  (B) In pursuing the negotiating objectives 
                described in subparagraph (A), United States 
                negotiators shall take into account legitimate 
                United States domestic objectives including, 
                but not limited to, the protection of 
                legitimate health or safety, essential 
                security, environmental, consumer or employment 
                opportunity interests and the law and 
                regulations related thereto.
          (12) Safeguards.--The principal negotiating 
        objectives of the United States regarding safeguards 
        are--
                  (A) to improve and expand rules and 
                procedures covering safeguard measures;
                  (B) to ensure that safeguard measures are--
                          (i) transparent,
                          (ii) temporary,
                          (iii) degressive, and
                          (iv) subject to review and 
                        termination when no longer necessary to 
                        remedy injury and to facilitate 
                        adjustment; and
                  (C) to require notification of, and to 
                monitor the use by, GATT Contracting Parties of 
                import relief actions for their domestic 
                industries.
          (13) Specific barriers.--The principal negotiating 
        objective of the United States regarding specific 
        barriers is to obtain competitive opportunities for 
        United States exports in foreign markets substantially 
        equivalent to the competitive opportunities afforded 
        foreign exports to United States markets, including the 
        reduction or elimination of specific tariff and 
        nontariff trade barriers, particularly--
                  (A) measures identified in the annual report 
                prepared under section 181 of the Trade Act of 
                1974 (19 U.S.C. 2241); and
                  (B) foreign tariffs and nontariff barriers on 
                competitive United States exports when like or 
                similar products enter the United States at low 
                rates of duty or are duty-free, and other 
                tariff disparities that impede access to 
                particular export markets.
          (14) Worker rights.--The principal negotiating 
        objectives of the United States regarding worker rights 
        are--
                  (A) to promote respect for worker rights;
                  (B) to secure a review of the relationship of 
                worker rights to GATT articles, objectives, and 
                related instruments with a view to ensuring 
                that the benefits of the trading system are 
                available to all workers; and
                  (C) to adopt, as a principle of the GATT, 
                that the denial of worker rights should not be 
                a means for a country or its industries to gain 
                competitive advantage in international trade.
          (15) Access to high technology.--
                  (A) The principal negotiating objective of 
                the United States regarding access to high 
                technology is to obtain the elimination or 
                reduction of foreign barriers to, and acts, 
                policies, or practices by foreign governments 
                which limit, equitable access by United States 
                persons to foreign-developed technology, 
                including barriers, acts, policies, or 
                practices which have the effect of--
                          (i) restricting the participation of 
                        United States persons in government-
                        supported research and development 
                        projects;
                          (ii) denying equitable access by 
                        United States persons to government-
                        held patents;
                          (iii) requiring the approval or 
                        agreement of government entities, or 
                        imposing other forms of government 
                        interventions, as a condition for the 
                        granting of licenses to United States 
                        persons by foreign persons (except for 
                        approval or agreement which may be 
                        necessary for national security 
                        purposes to control the export of 
                        critical military technology); and
                          (iv) otherwise denying equitable 
                        access by United States persons to 
                        foreign-developed technology or 
                        contributing to the inequitable flow of 
                        technology between the United States 
                        and its trading partners.
                  (B) In pursuing the negotiating objective 
                described in subparagraph (A), the United 
                States negotiators shall take into account 
                United States Government policies in licensing 
                or otherwise making available to foreign 
                persons technology and other information 
                developed by United States laboratories.
          (16) Border taxes.--The principal negotiating 
        objective of the United States regarding border taxes 
        is to obtain a revision of the GATT with respect to the 
        treatment of border adjustments for internal taxes to 
        redress the disadvantage to countries relying primarily 
        for revenue on direct taxes rather than indirect taxes.

Sections 1124 and 3004 of the Omnibus Trade and Competitiveness Act of 
                                  1988


              [22 U.S.C. 5304 and 5304 note; P.L. 100-418]

SEC. 1124. NEGOTIATIONS ON CURRENCY EXCHANGE RATES.

  (a) Findings.--The Congress finds that--
          (1) the benefit of trade concessions can be adversely 
        affected by misalignments in currency, and
          (2) misalignments in currency caused by government 
        policies intended to maintain an unfair trade advantage 
        tend to nullify and impair trade concessions.
  (b) Negotiations.--Whenever, in the course of negotiating a 
trade agreement under this subtitle, the President is advised 
by the Secretary of the Treasury that a foreign country that is 
a party to the negotiations satisfies the criteria for 
initiating bilateral currency negotiations listed in section 
3004(b) of this Act, the Secretary of the Treasury shall take 
action to initiate bilateral currency negotiations on an 
expedited basis with such foreign country.

SEC. 3004. INTERNATIONAL NEGOTIATIONS ON EXCHANGE RATE AND ECONOMIC 
                    POLICIES.

  (a) Multilateral Negotiations.--The President shall seek to 
confer and negotiate with other countries--
          (1) to achieve--
                  (A) better coordination of macroeconomic 
                policies of the major industrialized nations; 
                and
                  (B) more appropriate and sustainable levels 
                of trade and current account balances, and 
                exchange rates of the dollar and other 
                currencies consistent with such balances; and
          (2) to develop a program for improving existing 
        mechanisms for coordination and improving the 
        functioning of the exchange rate system to provide for 
        long-term exchange rate stability consistent with more 
        appropriate and sustainable current account balances.
  (b) Bilateral Negotiations.--The Secretary of the Treasury 
shall analyze on an annual basis the exchange rate policies of 
foreign countries, in consultation with the International 
Monetary Fund, and consider whether countries manipulate the 
rate of exchange between their currency and the United States 
dollar for purposes of preventing effective balance of payments 
adjustments or gaining unfair competitive advantage in 
international trade. If the Secretary considers that such 
manipulation is occurring with respect to countries that (1) 
have material global current account surpluses; and (2) have 
significant bilateral trade surpluses with the United States, 
the Secretary of the Treasury shall take action to initiate 
negotiations with such foreign countries on an expedited basis, 
in the International Monetary Fund or bilaterally, for the 
purpose of ensuring that such countries regularly and promptly 
adjust the rate of exchange between their currencies and the 
United States dollar to permit effective balance of payments 
adjustments and to eliminate the unfair advantage. The 
Secretary shall not be required to initiate negotiations in 
cases where such negotiations would have a serious detrimental 
impact on vital national economic and security interests; in 
such cases, the Secretary shall inform the chairman and the 
ranking minority member of the Committee on Banking, Housing, 
and Urban Affairs of the Senate and of the Committee on 
Banking, Finance and Urban Affairs of the House of 
Representatives of his determination.

Sections 131, 132, 135, and 315 of the Uruguay Round Agreements Act, as 
                                amended


[19 U.S.C. 3551, 3552, 3555, and 3581; P.L. 103-465, as amended by P.L. 
                104-188, P.L. 104-295, and P.L. 105-206]

SEC. 131. WORKING PARTY ON WORKER RIGHTS.

    (a) In General.--The President shall seek the establishment 
in the GATT 1947, and, upon entry into force of the WTO 
Agreement with respect to the United States, in the WTO, of a 
working party to examine the relationship of internationally 
recognized worker rights, as defined in section 507(4) of the 
Trade Act of 1974, to the articles, objectives, and related 
instruments of the GATT 1947 and of the WTO, respectively.
    (b) Objectives of Working Party.--The objectives of the 
United States for the working party described in subsection (a) 
are to--
          (1) explore the linkage between international trade 
        and internationally recognized worker rights, as 
        defined in section 507(4) of the Trade Act of 1974, 
        taking into account differences in the level of 
        development among countries;
          (2) examine the effects on international trade of the 
        systematic denial of such rights;
          (3) consider ways to address such effects; and
          (4) develop methods to coordinate the work program of 
        the working party with the International Labor 
        Organization.
    (c) Report to Congress.--The President shall report to the 
Congress, not later than 1 year after the date of the enactment 
of this Act, on the progress made in establishing the working 
party under this section, and on United States objectives with 
respect to the working party's work program.

SEC. 132. IMPLEMENTATION OF RULES OF ORIGIN WORK PROGRAM.

    If the President enters into an agreement developed under 
the work program described in Article 9 of the Agreement on 
Rules of Origin referred to in section 101(d)(10), the 
President may implement United States obligations under such an 
agreement under United States law only pursuant to authority 
granted to the President for that purpose by law enacted after 
the effective date of this section.

           *       *       *       *       *       *       *


SEC. 135. OBJECTIVES FOR EXTENDED NEGOTIATIONS.

    (a) Trade in Financial Services.--The principal negotiating 
objective of the United States in the extended negotiations on 
financial services to be conducted under the auspices of the 
WTO is to seek to secure commitments, from a wide range of 
commercially important developed and developing countries, to 
reduce or eliminate barriers to the supply of financial 
services, including barriers that deny national treatment or 
market access by restricting the establishment or operation of 
financial services providers, as the condition for the United 
States--
          (1) offering commitments to provide national 
        treatment and market access in each of the financial 
        service subsectors, and
          (2) making such commitments on a normal trade 
        relations basis.
    (b) Trade in Basic Telecommunications Services.--The 
principal negotiating objective of the United States in the 
extended negotiations on basic telecommunications services to 
be conducted under the auspices of the WTO is to obtain the 
opening on nondiscriminatory terms and conditions of foreign 
markets for basic telecommunications services through 
facilities-based competition or through the resale of services 
on existing networks.
    (c) Trade in Civil Aircraft.--
          (1) Negotiations.--The principal negotiating 
        objectives of the United States in the extended 
        negotiations on trade in civil aircraft to be conducted 
        under the auspices of the WTO are--
                  (A) to obtain competitive opportunities for 
                United States exports in foreign markets 
                substantially equivalent to those afforded to 
                foreign products in the United States,
                  (B) to obtain the reduction or elimination of 
                specific tariff and nontariff barriers, 
                including through expanded membership in the 
                Agreement on Trade in Civil Aircraft and in the 
                US-EC bilateral agreement for large civil 
                aircraft,
                  (C) to maintain vigorous and effective 
                disciplines on subsidies practices with respect 
                to civil aircraft products under the Agreement 
                on Subsidies and Countervailing Measures 
                referred to in section 101(d)(12),
                  (D) to maintain the scope and coverage on 
                indirect support as specified in the US-EC 
                bilateral agreement on large civil aircraft, 
                and
                  (E) to obtain increased transparency with 
                respect to foreign subsidy programs in the 
                civil aircraft sector, both through greater 
                government disclosure with respect to the use 
                of taxpayer moneys and higher financial 
                disclosure standards for companies receiving 
                government supports (including disclosure 
                comparable to that required under United States 
                securities laws).
          (2) Definitions.--For purposes of paragraph (1)--
                  (A) the term ``civil aircraft'' means those 
                products to which the Agreement on Trade in 
                Civil Aircraft applies,
                  (B) the term ``large civil aircraft'' has the 
                meaning given that term in Annex II to the US-
                EC bilateral agreement,
                  (C) the term ``indirect support'' means 
                indirect government support as defined in Annex 
                II to the US-EC bilateral agreement,
                  (D) the term ``Agreement on Trade in Civil 
                Aircraft'' means the Agreement on Trade in 
                Civil Aircraft approved by the Congress under 
                section 2 of the Trade Agreements Act of 1979, 
                and
                  (E) the term ``US-EC bilateral agreement'' 
                means the Agreement Concerning the Application 
                of the GATT Agreement on Trade in Civil 
                Aircraft Between the European Economic 
                Community and the Government of the United 
                States of America on trade in large civil 
                aircraft, entered into on July 17, 1992.

           *       *       *       *       *       *       *


SEC. 315. OBJECTIVES IN THE INTELLECTUAL PROPERTY.

    It is the objective of the United States--
          (1) to accelerate the implementation of the Agreement 
        on Trade-Related Aspects of Intellectual Property 
        Rights referred to in section 101(d)(15),
          (2) to seek enactment and effective implementation by 
        foreign countries of laws to protect and enforce 
        intellectual property rights that supplement and 
        strengthen the standards of the Agreement on Trade-
        Related Aspects of Intellectual Property Rights 
        referred to in section 101(d)(15) and the North 
        American Free Trade Agreement and, in particular--
                  (A) to conclude bilateral and multilateral 
                agreements that create obligations to protect 
                and enforce intellectual property rights that 
                cover new and emerging technologies and new 
                methods of transmission and distribution, and
                  (B) to prevent or eliminate discrimination 
                with respect to matters affecting the 
                availability, acquisition, scope, maintenance, 
                use, and enforcement of intellectual property 
                rights,
          (3) to secure fair, equitable, and nondiscriminatory 
        market access opportunities for United States persons 
        that rely upon intellectual property protection,
          (4) to take an active role in the development of the 
        intellectual property regime under the World Trade 
        Organization to ensure that it is consistent with other 
        United States objectives, and
          (5) to take an active role in the World Intellectual 
        Property Organization (WIPO) to develop a cooperative 
        and mutually supportive relationship between the World 
        Trade Organization and WIPO.

          Section 409 of the Trade and Development Act of 2000


                  [7 U.S.C. 1736r note; P.L. 106-200]

SEC. 409. AGRICULTURAL TRADE NEGOTIATING OBJECTIVES AND CONSULTATIONS 
                    WITH CONGRESS.

    (a) Findings.--Congress finds that--
          (1) United States agriculture contributes positively 
        to the United States balance of trade and United States 
        agricultural exports support in excess of 1,000,000 
        United States jobs;
          (2) United States agriculture competes successfully 
        worldwide despite the fact that United States producers 
        are at a competitive disadvantage because of the trade 
        distorting support and subsidy practices of other 
        countries and despite the fact that significant tariff 
        and nontariff barriers exist to United States exports; 
        and
          (3) a successful conclusion of the current World 
        Trade Organization agricultural negotiations is 
        critically important to the United States agricultural 
        sector.
    (b) Objectives.--The agricultural negotiating objectives of 
the United States with respect to the current World Trade 
Organization agricultural negotiations include as matters of 
the highest priority--
          (1) The expeditious elimination of all export 
        subsidies worldwide while maintaining bona fide food 
        aid and preserving United States market development and 
        export credit programs that allow the United States to 
        compete with other foreign export promotion efforts;
          (2) leveling the playing field for United States 
        producers of agricultural products by eliminating blue 
        box subsidies and disciplining domestic supports in a 
        way that forces producers to face world prices on all 
        production in excess of domestic food security needs 
        allowing the preservation of nontrade distorting 
        programs to support family farms and rural communities;
          (3) the elimination of state trading enterprises or 
        the adoption of rigorous disciplines that ensure 
        operational transparency, competition, and the end of 
        discriminatory pricing practices, including policies 
        supporting cross-subsidization and price undercutting 
        in export markets;
          (4) affirming that the World Trade Organization 
        Agreement on the Application of Sanitary and 
        Phytosanitary Measures applies to new technologies, 
        including biotechnology, and that labeling requirements 
        to allow consumers to make choices regarding 
        biotechnology products or other regulatory requirements 
        may not be used as disguised barriers to trade:
          (5) increasing opportunities for United States 
        exports of agricultural products by reducing tariffs to 
        the same levels that exist in the United States or to 
        lower levels and by eliminating all nontariff barriers, 
        including--
                  (A) restrictive or trade distorting 
                practices, including those that adversely 
                impact perishable or cyclical products;
                  (B) restrictive rules in the administration 
                of tariff rate quotas; and
                  (C) other barriers to agriculture trade, 
                including unjustified restrictions or 
                commercial requirements affecting new 
                technologies, including biotechnology;
          (6) eliminating government policies that create 
        price-depressing surpluses; and
          (7) strengthening dispute settlement procedures to 
        ensure prompt compliance by foreign governments with 
        their World Trade Organization obligations including 
        commitments not to maintain unjustified restrictions on 
        United States exports.
    (c) Consultation With Congressional Committees.--
          (1) Consultation before offer made.--In developing 
        and before submitting an initial or revised negotiating 
        proposal that would reduce United States tariffs on 
        agricultural products or require a change in United 
        States agricultural law, the United States Trade 
        Representative shall consult with the Committee on 
        Agriculture, Nutrition, and Forestry and the Committee 
        on Finance of the Senate and the Committee on 
        Agriculture and the Committee on Ways and Means of the 
        House of Representatives.
          (2) Consultation with congressional trade advisers.--
        Prior to and during the course of current negotiations 
        on agricultural trade, the United States Trade 
        Representative shall consult closely with the 
        congressional trade advisers.
          (3) Consultation before agreement initialed.--Not 
        less than 48 hours before initialing an agreement 
        reached as part of current World Trade Organization 
        agricultural negotiations, the United States Trade 
        Representative shall consult closely with the 
        committees referred to in paragraph (1) regarding--
                  (A) the details of the agreement;
                  (B) the potential impact of the agreement on 
                United States agricultural producers; and
                  (C) any changes in United States law 
                necessary to implement the agreement.
          (4) Disclosure of commitments.--Any agreement or 
        other understanding addressing agricultural trade with 
        a foreign government or governments (whether oral or in 
        writing) that relates to a trade agreement with respect 
        to which Congress must enact implementing legislation 
        and that is not disclosed to Congress before 
        legislation implementing that agreement is introduced 
        in either House of Congress shall not be considered to 
        be part of the agreement approved by Congress and shall 
        have no force and effect under United States law or in 
        any dispute settlement body.
      (d) Sense of the Congress.--It is the sense of the 
Congress that--
          (1) granting the President trade negotiating 
        authority is essential to the successful conclusion of 
        the new round of World Trade Organization agricultural 
        negotiations;
          (2) reaching a successful agreement on agriculture 
        should be the top priority of United States 
        negotiators; and
          (3) if by the conclusion of the negotiations, the 
        primary agricultural competitors of the United States 
        do not agree to reduce their trade distorting domestic 
        supports and eliminate export subsidies in accordance 
        with the negotiating objectives expressed in this 
        section, the United States should take steps to 
        increase the leverage of United States negotiators and 
        level the playing field for United States producers.

 Section 108 of the North American Free Trade Agreement Implementation 
                                  Act


                     [19 U.S.C. 3317; P.L. 103-182]

SEC. 108. CONGRESSIONAL INTENT REGARDING FUTURE ACCESSIONS.

    (a) In General.--Section 101(a) may not be construed as 
conferring Congressional approval of the entry into force of 
the Agreement for the United States with respect to countries 
other than Canada and Mexico.
    (b) Future Free Trade Area Negotiations.--
          (1) Findings.--The Congress makes the following 
        findings:
                  (A) Efforts by the United States to obtain 
                greater market opening through multilateral 
                negotiations have not produced agreements that 
                fully satisfy the trade negotiating objectives 
                of the United States.
                  (B) United States trade policy should provide 
                for additional mechanisms with which to pursue 
                greater market access for United States exports 
                of goods and services and opportunities for 
                export-related investment by United States 
                persons.
                  (C) Among the additional mechanisms should be 
                a system of bilateral and multilateral trade 
                agreements that provide greater market access 
                for United States exports and opportunities for 
                export-related investment by United States 
                persons.
                  (D) The system of trade agreements can and 
                should be structured to be consistent with, and 
                complementary to, existing international 
                obligations of the United States and ongoing 
                multilateral efforts to open markets.
          (2) Report on significant market opening.--No later 
        than May 1, 1994, and May 1, 1997, the Trade 
        Representative shall submit to the President, and to 
        the Committee on Finance of the Senate and the 
        Committee on Ways and Means of the House of 
        Representatives (hereafter in this section referred to 
        as the ``appropriate Congressional Committees''), a 
        report which lists those foreign countries--
                  (A) that--
                          (i) currently provide fair and 
                        equitable market access for United 
                        States exports of goods and services 
                        and opportunities for export-related 
                        investment by United States persons, 
                        beyond what is required by existing 
                        multilateral trade agreements or 
                        obligations; or
                          (ii) have made significant progress 
                        in opening their markets to United 
                        States exports of goods and services 
                        and export-related investment by United 
                        States persons; and
                  (B) the further opening of whose markets has 
                the greatest potential to increase United 
                States exports of goods and services and 
                export-related investment by United States 
                persons, either directly or through the 
                establishment of a beneficial precedent.
          (3) Presidential determination.--The President, on 
        the basis of the report submitted by the Trade 
        Representative under paragraph (2), shall determine 
        with which foreign country or countries, if any, the 
        United States should seek to negotiate a free trade 
        area agreement or agreements.
          (4) Recommendations on future free trade area 
        negotiations.--No later than July 1, 1994, and July 1, 
        1997, the President shall submit to the appropriate 
        Congressional committees a written report that 
        contains--
                  (A) recommendations for free trade area 
                negotiations with each foreign country selected 
                under paragraph (3);
                  (B) with respect to each country selected, 
                the specific negotiating objectives that are 
                necessary to meet the objectives of the United 
                States under this section; and
                  (C) legislative proposals to ensure adequate 
                consultation with the Congress and the private 
                sector during the negotiations, advance 
                Congressional approval of the negotiations 
                recommended by the President, and Congressional 
                approval of any trade agreement entered into by 
                the President as a result of the negotiations.
          (5) General negotiating objectives.--The general 
        negotiating objectives of the United States under this 
        section are to obtain--
                  (A) preferential treatment for United States 
                goods;
                  (B) national treatment and, where 
                appropriate, equivalent competitive opportunity 
                for United States services and foreign direct 
                investment by United States persons;
                  (C) the elimination of barriers to trade in 
                goods and services by United States persons 
                through standards, testing, labeling, and 
                certification requirements;
                  (D) nondiscriminatory government procurement 
                policies and practices with respect to United 
                States goods and services;
                  (E) the elimination of other barriers to 
                market access for United States goods and 
                services, and the elimination of barriers to 
                foreign direct investment by United States 
                persons;
                  (F) the elimination of acts, policies, and 
                practices which deny fair and equitable market 
                opportunities, including foreign government 
                toleration of anticompetitive business 
                practices by private firms or among private 
                firms that have the effect of restricting, on a 
                basis that is inconsistent with commercial 
                considerations, purchasing by such firms of 
                United States goods and services;
                  (G) adequate and effective protection of 
                intellectual property rights of United States 
                persons, and fair and equitable market access 
                for United States persons that rely upon 
                intellectual property protection;
                  (H) the elimination of foreign export and 
                domestic subsidies that distort international 
                trade in United States goods and services or 
                cause material injury to United States 
                industries;
                  (I) the elimination of all export taxes;
                  (J) the elimination of acts, policies, and 
                practices which constitute export targeting; 
                and
                  (K) monitoring and effective dispute 
                settlement mechanisms to facilitate compliance 
                with the matters described in subparagraphs (A) 
                through (J).

       B. GENERAL TRADE AGREEMENT AND IMPLEMENTATION AUTHORITIES


                 1. ``Fast Track'' Authority (expired)


     Sections 1102, 1103, 1105, and 1107 of the Omnibus Trade and 
                Competitiveness Act of 1988, as amended


[19 U.S.C. 2902, 2903, 2904, and 2906; P.L. 100-418, as amended by P.L. 
                101-382, P.L. 103-49, and P.L. 103-465]

SEC. 1102. TRADE AGREEMENT NEGOTIATING AUTHORITY.

  (a) Agreements Regarding Tariff Barriers.--
          (1) Whenever the President determines that one or 
        more existing duties or other import restrictions of 
        any foreign country or the United States are unduly 
        burdening and restricting the foreign trade of the 
        United States and that the purposes, policies, and 
        objectives of this title will be promoted thereby, the 
        President--
                  (A) before June 1, 1993, may enter into trade 
                agreements with foreign countries; and
                  (B) may, subject to paragraphs (2) through 
                (5), proclaim--
                          (i) such modification or continuance 
                        of any existing duty,
                          (ii) such continuance of existing 
                        duty-free or excise treatment, or
                          (iii) such additional duties;
                as he determines to be required or appropriate 
                to carry out any such trade agreement.
          (2) No proclamation may be made under subsection (a) 
        that--
                  (A) reduces any rate of duty (other than a 
                rate of duty that does not exceed 5 percent ad 
                valorem on the date of enactment of this Act) 
                to a rate which is less than 50 percent of the 
                rate of such duty that applies on such date of 
                enactment; or
                  (B) increases any rate of duty above the rate 
                that applies on such date of enactment.
          (3)(A) Except as provided in subparagraph (B), the 
        aggregate reduction in the rate of duty on any article 
        which is in effect on any day pursuant to a trade 
        agreement entered into under paragraph (1) shall not 
        exceed the aggregate reduction which would have been in 
        effect on such day if a reduction of 3 percent ad 
        valorem or a reduction of one-tenth of the total 
        reduction, whichever is greater, had taken effect on 
        the effective date of the first reduction proclaimed in 
        paragraph (1) to carry out such agreement with respect 
        to such article.
          (B) No staging under subparagraph (A) is required 
        with respect to a rate reduction that is proclaimed 
        under paragraph (1) for an article of a kind that is 
        not produced in the United States. The United States 
        International Trade Commission shall advise the 
        President of the identity of articles that may be 
        exempted from staging under this subparagraph.
          (4) If the President determines that such action will 
        simplify the computation of reductions under paragraph 
        (3), the President may round an annual reduction by the 
        lesser of--
                  (A) the difference between the reduction 
                without regard to this paragraph and the next 
                lower whole number; or
                  (B) one-half of 1 percent ad valorem.
          (5) No reduction in a rate of duty under a trade 
        agreement entered into under subsection (a) on any 
        article may take effect more than 10 years after the 
        effective date of the first reduction under paragraph 
        (1) that is proclaimed to carry out the trade agreement 
        with respect to such article.
          (6) A rate of duty reduction or increase that may not 
        be proclaimed by reason of paragraph (2) may take 
        effect only if a provision authorizing such reduction 
        or increase is included within an implementing bill 
        provided for under section 1103 and that bill is 
        enacted into law.
  (b) Agreements Regarding Nontariff Barriers.--
          (1) Whenever the President determines that any 
        barrier to, or other distortion of, international 
        trade--
                  (A) unduly burdens or restricts the foreign 
                trade of the United States or adversely affects 
                the United States economy; or
                  (B) the imposition of any such barrier or 
                distortion is likely to result in such a 
                burden, restriction, or effect;
        and that the purposes, policies, and objectives of this 
        title will be promoted thereby, the President may, 
        before June 1, 1993, enter into a trade agreement with 
        foreign countries providing for--
                  (i) the reduction or elimination of such 
                barrier or other distortion; or
                  (ii) the prohibition of, or limitations on 
                the imposition of, such barrier or other 
                distortion.
          (2) A trade agreement may be entered into under this 
        subsection only if such agreement makes progress in 
        meeting the applicable objectives described in section 
        1101.
  (c) Bilateral Agreements Regarding Tariff and Nontariff 
Barriers.--
          (1) Before June 1, 1993, the President may enter into 
        bilateral trade agreements with foreign countries that 
        provide for the elimination or reduction of any duty 
        imposed by the United States. A trade agreement entered 
        into under this paragraph may also provide for the 
        reduction or elimination of barriers to, or other 
        distortions of, the international trade of the foreign 
        country or the United States.
          (2) Notwithstanding any other provision of law, no 
        trade benefit shall be extended to any country by 
        reason of the extension of any trade benefit to another 
        country under a trade agreement entered into under 
        paragraph (1) with such other country.
          (3) A trade agreement may be entered into under 
        paragraph (1) with any foreign country only if--
                  (A) the agreement makes progress in meeting 
                the applicable objectives described in section 
                1101;
                  (B) such foreign country requests the 
                negotiation of such an agreement; and
                  (C) the President, at least 60 days before 
                the date notice is provided under section 
                1103(a)(1)(A)--
                          (i) provides written notice of such 
                        negotiations to the Committee on 
                        Finance of the Senate and the Committee 
                        on Ways and Means of the House of 
                        Representatives, and
                          (ii) consults with such committees 
                        regarding the negotiation of such 
                        agreement.
          (4) The 60-day period of time described in paragraph 
        (3)(C) shall be computed in accordance with section 
        1103(e).
          (5) In any case in which there is an inconsistency 
        between any provision of this Act and any bilateral 
        free trade area agreement that entered into force and 
        effect with respect to the United States before January 
        1, 1987, the provision shall not apply with respect to 
        the foreign country that is party to that agreement.
  (d) Consultation With Congress Before Agreements Entered 
Into.--
          (1) Before the President enters into any trade 
        agreement under subsection (b) or (c), the President 
        shall consult with--
                  (A) the Committee on Ways and Means of the 
                House of Representatives and the Committee on 
                Finance of the Senate; and
                  (B) each other committee of the House and the 
                Senate, and each joint committee of the 
                Congress, which has jurisdiction over 
                legislation involving subject matters which 
                would be affected by the trade agreement.
          (2) The consultation under paragraph (1) shall 
        include--
                  (A) the nature of the agreement;
                  (B) how and to what extent the agreement will 
                achieve the applicable purposes, policies, and 
                objectives of this title; and
                  (C) all matters relating to the 
                implementation of the agreement under section 
                1103.
          (3) If it is proposed to implement two or more trade 
        agreements in a single implementing bill under section 
        1103, the consultation under paragraph (1) shall 
        include the desirability and feasibility of such 
        proposed implementation.
    (e) Special Provisions Regarding Uruguay Round Trade 
Negotiations.--
          (1) In general.--Notwithstanding the time limitations 
        in subsections (a) and (b), if the Uruguay Round of 
        multilateral trade negotiations under the auspices of 
        the General Agreement on Tariffs and Trade has not 
        resulted in trade agreements by May 31, 1993, the 
        President may, during the period after May 31, 1993, 
        and before April 16, 1994, enter into, under 
        subsections (a) and (b), trade agreements resulting 
        from such negotiations.
          (2) Application of tariff proclamation authority.--No 
        proclamation under subsection (a) to carry out the 
        provisions regarding tariff barriers of a trade 
        agreement that is entered into pursuant to paragraph 
        (1) may take effect before the effective date of a bill 
        that implements the provisions regarding nontariff 
        barriers of a trade agreement that is entered into 
        under such paragraph.
          (3) Application of implementing and ``fast track'' 
        procedures.--Section 1103 applies to any trade 
        agreement negotiated under subsection (b) pursuant to 
        paragraph (1), except that--
                  (A) in applying subsection (a)(1)(A) of 
                section 1103 to any such agreement, the phrase 
                ``at least 120 calendar days before the day on 
                which he enters into the trade agreement (but 
                not later than December 15, 1993),'' shall be 
                substituted for the phrase ``at least 90 
                calendar days before the day on which he enters 
                into the trade agreement,''; and
                  (B) no provision of subsection (b) of section 
                1103 other than paragraph (1)(A) applies to any 
                such agreement and in applying such paragraph, 
                ``April 16, 1994;'' shall be substituted for 
                ``June 1, 1991;''.
          (4) Advisory committee reports.--The report required 
        under section 135(e)(1) of the Trade Act of 1974 
        regarding any trade agreement provided for under 
        paragraph (1) shall be provided to the President, the 
        Congress, and the United States Trade Representative 
        not later than 30 days after the date on which the 
        President notifies the Congress under section 
        1103(a)(1)(A) of his intention to enter into the 
        agreement (but before January 15, 1994).

SEC. 1103. IMPLEMENTATION OF TRADE AGREEMENTS.

  (a) In General.--
          (1) Any agreement entered into under section 1102 (b) 
        or (c) shall enter into force with respect to the 
        United States if (and only if)--
                  (A) the President, at least 90 calendar days 
                before the day on which he enters into the 
                trade agreement, notifies the House of 
                Representatives and the Senate of his intention 
                to enter into the agreement, and promptly 
                thereafter publishes notice of such intention 
                in the Federal Register;
                  (B) after entering into the agreement, the 
                President submits a document to the House of 
                Representatives and to the Senate containing a 
                copy of the final legal text of the agreement, 
                together with--
                          (i) a draft of an implementing bill,
                          (ii) a statement of any 
                        administrative action proposed to 
                        implement the trade agreement, and
                          (iii) the supporting information 
                        described in paragraph (2); and
                  (C) the implementing bill is enacted into 
                law.
          (2) The supporting information required under 
        paragraph (1)(B)(iii) consists of--
                  (A) an explanation as to how the implementing 
                bill and proposed administrative action will 
                change or affect existing law; and
                  (B) a statement--
                          (i) asserting that the agreement 
                        makes progress in achieving the 
                        applicable purposes, policies, and 
                        objectives of this title,
                          (ii) setting forth the reasons of the 
                        President regarding--
                                  (I) how and to what extent 
                                the agreement makes progress in 
                                achieving the applicable 
                                purposes, policies, and 
                                objectives referred to in 
                                clause (i), and why and to what 
                                extent the agreement does not 
                                achieve other applicable 
                                purposes, policies, and 
                                objectives,
                                  (II) how the agreement serves 
                                the interests of United States 
                                commerce, and
                                  (III) why the implementing 
                                bill and proposed 
                                administrative action is 
                                required or appropriate to 
                                carry out the agreement;
                          (iii) describing the efforts made by 
                        the President to obtain international 
                        exchange rate equilibrium and any 
                        effect the agreement may have regarding 
                        increased international monetary 
                        stability; and
                          (iv) describing the extent, if any, 
                        to which--
                                  (I) each foreign country that 
                                is a party to the agreement 
                                maintains non-commercial state 
                                trading enterprises that may 
                                adversely affect, nullify, or 
                                impair the benefits to the 
                                United States under the 
                                agreement, and
                                  (II) the agreement applies to 
                                or affects purchases and sales 
                                by such enterprises.
          (3) To ensure that a foreign country which receives 
        benefits under a trade agreement entered into under 
        section 1102 (b) or (c) is subject to the obligations 
        imposed by such agreement, the President shall 
        recommend to Congress in the implementing bill and 
        statement of administrative action submitted with 
        respect to such agreement that the benefits and 
        obligations of such agreement apply solely to the 
        parties to such agreement, if such application is 
        consistent with the terms of such agreement. The 
        President may also recommend with respect to any such 
        agreement that the benefits and obligations of such 
        agreement not apply uniformly to all parties to such 
        agreement, if such application is consistent with the 
        terms of such agreement.
  (b) Application of Congressional ``Fast Track'' Procedures to 
Implementing Bills.--
          (1) Except as provided in subsection (c)--
                  (A) the provisions of section 151 of the 
                Trade Act of 1974 (19 U.S.C. 2191) (hereinafter 
                in this section referred to as ``fast track 
                procedures'') apply to implementing bills 
                submitted with respect to trade agreements 
                entered into under section 1102 (b) or (c) 
                before June 1, 1991; and
                  (B) such fast track procedures shall be 
                extended to implementing bills submitted with 
                respect to trade agreements entered into under 
                section 1102 (b) or (c) after May 31, 1991, and 
                before June 1, 1993, if (and only if)--
                          (i) the President requests such 
                        extension under paragraph (2); and
                          (ii) neither House of the Congress 
                        adopts an extension disapproval 
                        resolution under paragraph (5) before 
                        June 1, 1991.
          (2) If the President is of the opinion that the fast 
        track procedures should be extended to implementing 
        bills described in paragraph (1)(B), the President must 
        submit to the Congress, no later than March 1, 1991, a 
        written report that contains a request for such 
        extension, together with--
                  (A) a description of all trade agreements 
                that have been negotiated under section 1102 
                (b) or (c) and the anticipated schedule for 
                submitting such agreements to the Congress for 
                approval;
                  (B) a description of the progress that has 
                been made in multilateral and bilateral 
                negotiations to achieve the purposes, policies, 
                and objectives of this title, and a statement 
                that such progress justifies the continuation 
                of negotiations; and
                  (C) a statement of the reasons why the 
                extension is needed to complete the 
                negotiations.
          (3) The President shall promptly inform the Advisory 
        Committee for Trade Policy and Negotiations established 
        under section 135 of the Trade Act of 1974 (19 U.S.C. 
        2155) of his decision to submit a report to Congress 
        under paragraph (2). The Advisory Committee shall 
        submit to the Congress as soon as practicable, but no 
        later than March 1, 1991, a written report that 
        contains--
                  (A) its views regarding the progress that has 
                been made in multilateral and bilateral 
                negotiations to achieve the purposes, policies, 
                and objectives of this title; and
                  (B) a statement of its views, and the reasons 
                therefor, regarding whether the extension 
                requested under paragraph (2) should be 
                approved or disapproved.
          (4) The reports submitted to the Congress under 
        paragraphs (2) and (3), or any portion of the reports, 
        may be classified to the extent the President 
        determines appropriate.
          (5)(A) For purposes of this subsection, the term 
        ``extension disapproval resolution'' means a resolution 
        of either House of the Congress, the sole matter after 
        the resolving clause of which is as follows: ``That the 
                     disapproves the request of the President 
        for the extension, under section 1103(b)(1)(B)(i) of 
        the Omnibus Trade and Competitiveness Act of 1988, of 
        the provisions of section 151 of the Trade Act of 1974 
        to any implementing bill submitted with respect to any 
        trade agreement entered into under section 1102 (b) or 
        (c) of such Act after May 31, 1991, because sufficient 
        tangible progress has not been made in trade 
        negotiations.'', with the blank space being filled with 
        the name of the resolving House of the Congress.
          (B) Extension disapproval resolutions--
                  (i) may be introduced in either House of the 
                Congress by any member of such House; and
                  (ii) shall be jointly referred, in the House 
                of Representatives, to the Committee on Ways 
                and Means and the Committee on Rules.
          (C) The provisions of section 152 (d) and (e) of the 
        Trade Act of 1974 (19 U.S.C. 2192 (d) and (e)) 
        (relating to the floor consideration of certain 
        resolutions in the House and Senate) apply to extension 
        disapproval resolutions.
          (D) It is not in order for--
                  (i) the Senate to consider any extension 
                disapproval resolution not reported by the 
                Committee on Finance;
                  (ii) the House of Representatives to consider 
                any extension disapproval resolution not 
                reported by the Committee on Ways and Means and 
                the Committee on Rules; or
                  (iii) either House of the Congress to 
                consider an extension disapproval resolution 
                that is reported to such House after May 15, 
                1991.
  (c) Limitations on Use of ``Fast Track'' Procedures.--
          (1)(A) The fast track procedures shall not apply to 
        any implementing bill submitted with respect to a trade 
        agreement entered into under section 1102 (b) or (c) if 
        both Houses of the Congress separately agree to 
        procedural disapproval resolutions within any 60-day 
        period.
          (B) Procedural disapproval resolutions--
                  (i) in the House of Representatives--
                          (I) shall be introduced by the 
                        chairman or ranking minority member of 
                        the Committee on Ways and Means or the 
                        chairman or ranking minority member of 
                        the Committee on Rules,
                          (II) shall be jointly referred to the 
                        Committee on Ways and Means and the 
                        Committee on Rules, and
                          (III) may not be amended by either 
                        Committee; and
                  (ii) in the Senate shall be original 
                resolutions of the Committee on Finance.
          (C) The provisions of section 152 (d) and (e) of the 
        Trade Act of 1974 (19 U.S.C. 2192 (d) and (e)) 
        (relating to the floor consideration of certain 
        resolutions in the House and Senate) apply to 
        procedural disapproval resolutions.
          (D) It is not in order for the House of 
        Representatives to consider any procedural disapproval 
        resolution not reported by the Committee on Ways and 
        Means and the Committee on Rules.
          (E) For purposes of this subsection, the term 
        ``procedural disapproval resolution'' means a 
        resolution of either House of the Congress, the sole 
        matter after the resolving clause of which is as 
        follows: ``That the President has failed or refused to 
        consult with Congress on trade negotiations and trade 
        agreements in accordance with the provisions of the 
        Omnibus Trade and Competitiveness Act of 1988, and, 
        therefore, the provisions of section 151 of the Trade 
        Act of 1974 shall not apply to any implementing bill 
        submitted with respect to any trade agreement entered 
        into under section 1102 (b) or (c) of such Act of 1988, 
        if, during the 60-day period beginning on the date on 
        which this resolution is agreed to by the     , the     
           agrees to a procedural disapproval resolution 
        (within the meaning of section 1103(c)(1)(E) of such 
        Act of 1988).'', with the first blank space being 
        filled with the name of the resolving House of the 
        Congress and the second blank space being filled with 
        the name of the other House of the Congress.
          (2) The fast track procedures shall not apply to any 
        implementing bill that contains a provision approving 
        of any trade agreement which is entered into under 
        section 1102(c) with any foreign country if either--
                  (A) the requirements of section 1102(c)(3) 
                are not met with respect to the negotiation of 
                such agreement; or
                  (B) the Committee on Finance of the Senate or 
                the Committee on Ways and Means of the House of 
                Representatives disapproves of the negotiation 
                of such agreement before the close of the 60-
                day period which begins on the date notice is 
                provided under section 1102(c)(3)(C)(i) with 
                respect to the negotiation of such agreement.
  (d) Rules of House of Representatives and Senate.--
Subsections (b) and (c) are enacted by the Congress--
          (1) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such is deemed a part of the rules of each 
        House, respectively, and such procedures supersede 
        other rules only to the extent that they are 
        inconsistent with such other rules; and
          (2) with the full recognition of the constitutional 
        right of either House to change the rules (so far as 
        relating to the procedures of that House) at any time, 
        in the same manner, and to the same extent as any other 
        rule of that House.
  (e) Computation of Certain Periods of Time.--Each period of 
time described in subsection (c)(1) (A) and (E) and (2) of this 
section shall be computed without regard to--
          (1) the days on which either House of Congress is not 
        in session because of an adjournment of more than 3 
        days to a day certain or an adjournment of the Congress 
        sine die; and
          (2) any Saturday and Sunday, not excluded under 
        paragraph (1), when either House of the Congress is not 
        in session.

SEC. 1105. TERMINATION AND RESERVATION AUTHORITY; RECIPROCAL 
                    NONDISCRIMINATORY TREATMENT.

  (a) In General.--For purposes of applying sections 125, 
126(a), and 127 of the Trade Act of 1974 (19 U.S.C. 2135, 
2136(a), and 2137)--
          (1) any trade agreement entered into under section 
        1102 shall be treated as an agreement entered into 
        under section 101 or 102, as appropriate, of the Trade 
        Act of 1974 (19 U.S.C. 2111 or 2112); and
          (2) any proclamation or Executive order issued 
        pursuant to a trade agreement entered into under 
        section 1102 shall be treated as a proclamation or 
        Executive order issued pursuant to a trade agreement 
        entered into under section 102 of the Trade Act of 
        1974.
  (b) Reciprocal Nondiscriminatory Treatment.--
          (1) The President shall determine, before June 1, 
        1993, whether any major industrial country has failed 
        to make concessions under trade agreements entered into 
        under section 1102 (a) and (b) which provide 
        competitive opportunities for the commerce of the 
        United States in such country substantially equivalent 
        to the competitive opportunities, provided by 
        concessions made by the United States under trade 
        agreements entered into under section 1102 (a) and (b), 
        for the commerce of such country in the United States.
          (2) If the President determines under paragraph (1) 
        that a major industrial country has not made 
        concessions under trade agreements entered into under 
        section 1102 (a) and (b) which provide substantially 
        equivalent competitive opportunities for the commerce 
        of the United States, the President shall, either 
        generally with respect to such country or by article 
        produced by such country, in order to restore 
        equivalence of competitive opportunities, recommend to 
        the Congress--
                  (A) legislation providing for the termination 
                or denial of the benefits of concessions of 
                trade agreements entered into under section 
                1102 (a) and (b) that have been made with 
                respect to rates of duty or other import 
                restrictions imposed by the United States, and
                  (B) legislation providing that any law 
                necessary to carry out any trade agreement 
                under section 1102 (a) or (b) not apply to such 
                country.
          (3) For purposes of this subsection, the term ``major 
        industrial country'' means Canada, the European 
        Communities, the individual member countries of the 
        European Communities, Japan, and any other foreign 
        country designated by the President for purposes of 
        this subsection.

SEC. 1107. DEFINITIONS AND CONFORMING AMENDMENTS.

  (a) Definitions.--For purposes of this part [trade agreement 
and implementation authorities under sections 1101-1106 of the 
Omnibus Trade and Competitiveness Act of 1988]:
          (1) The term ``distortion'' includes, but is not 
        limited to, a subsidy.
          (2) The term ``foreign country'' includes any foreign 
        instrumentality. Any territory or possession of a 
        foreign country that is administered separately for 
        customs purposes, shall be treated as a separate 
        foreign country.
          (3) The term ``GATT'' means the GATT 1947 (as defined 
        in section 2(1)(A) of the Uruguay Round Agreements 
        Act).
          (4) The term ``implementing bill'' has the meaning 
        given such term in section 151(b)(1) of the Trade Act 
        of 1974 (19 U.S.C. 2191(b)(1)).
          (5) The term ``international trade'' includes, but is 
        not limited to--
                  (A) trade in both goods and services, and
                  (B) foreign direct investment by United 
                States persons, especially if such investment 
                has implications for trade in goods and 
                services.
          (6) The term ``state trading enterprise'' means--
                  (A) any agency, instrumentality, or 
                administrative unit of a foreign country 
                which--
                          (i) purchases goods or services in 
                        international trade for any purpose 
                        other than the use of such goods or 
                        services by such agency, 
                        instrumentality, administrative unit, 
                        or foreign country, or
                          (ii) sells goods or services in 
                        international trade; or
                  (B) any business firm which--
                          (i) is substantially owned or 
                        controlled by a foreign country or any 
                        agency, instrumentality, or 
                        administrative unit thereof,
                          (ii) is granted (formally or 
                        informally) any special or exclusive 
                        privilege by such foreign country, 
                        agency, instrumentality, or 
                        administrative unit, and
                          (iii) purchases goods or services in 
                        international trade for any purpose 
                        other than the use of such goods or 
                        services by such foreign country, 
                        agency, instrumentality, or 
                        administrative unit, or which sells 
                        goods or services in international 
                        trade.

2. Uruguay Round/WTO Implementation, Tariff Modifications, and Dispute 
                               Settlement


  Sections 101(a and b), 102, 111(a, b, c, and e), and 121-129 of the 
                      Uruguay Round Agreements Act


         [19 U.S.C. 3511, 3512, 3521, 3531-3538; P.L. 103-465]

SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE URUGUAY ROUND 
                    AGREEMENTS.

    (a) Approval of Agreements and Statement of Administrative 
Action.--Pursuant to section 1103 of the Omnibus Trade and 
Competitiveness Act of 1988 (19 U.S.C. 2903) and section 151 of 
the Trade Act of 1974 (19 U.S.C. 2191), the Congress approves--
          (1) the trade agreements described in subsection (d) 
        resulting from the Uruguay Round of multilateral trade 
        negotiations under the auspices of the General 
        Agreement on Tariffs and Trade, entered into on April 
        15, 1994, and submitted to the Congress on September 
        27, 1994; and
          (2) the statement of administrative action proposed 
        to implement the agreements that was submitted to the 
        Congress on September 27, 1994.
    (b) Entry Into Force.--At such time as the President 
determines that a sufficient number of foreign countries are 
accepting the obligations of the Uruguay Round Agreements, in 
accordance with article XIV of the WTO Agreement, to ensure the 
effective operation of, and adequate benefits for the United 
States under, those Agreements, the President may accept the 
Uruguay Round Agreements and implement article VIII of the WTO 
Agreement.

SEC. 102. RELATIONSHIP OF THE AGREEMENTS TO UNITED STATES LAW AND STATE 
                    LAW.

    (a) Relationship of Agreements to United States Law.--
          (1) United states law to prevail in conflict.--No 
        provision of any of the Uruguay Round Agreements, nor 
        the application of any such provision to any person or 
        circumstance, that is inconsistent with any law of the 
        United States shall have effect.
          (2) Construction.--Nothing in this Act shall be 
        construed--
                  (A) to amend or modify any law of the United 
                States, including any law relating to--
                          (i) the protection of human, animal, 
                        or plant life or health,
                          (ii) the protection of the 
                        environment, or
                          (iii) worker safety, or
                  (B) to limit any authority conferred under 
                any law of the United States, including section 
                301 of the Trade Act of 1974,
        unless specifically provided for in this Act.
    (b) Relationship of Agreements to State Law.--
          (1) Federal-state consultation.--
                  (A) In general.--Upon the enactment of this 
                Act, the President shall, through the 
                intergovernmental policy advisory committees on 
                trade established under section 306(c)(2)(A) of 
                the Trade and Tariff Act of 1984 (19 U.S.C. 
                2114c(2)(A)), consult with the States for the 
                purpose of achieving conformity of State laws 
                and practices with the Uruguay Round 
                Agreements.
                  (B) Federal-state consultation process.--The 
                Trade Representative shall establish within the 
                Office of the United States Trade 
                Representative a Federal-State consultation 
                process for addressing issues relating to the 
                Uruguay Round Agreements that directly relate 
                to, or will potentially have a direct effect 
                on, the States. The Federal-State consultation 
                process shall include procedures under which--
                          (i) the States will be informed on a 
                        continuing basis of matters under the 
                        Uruguay Round Agreements that directly 
                        relate to, or will potentially have a 
                        direct impact on, the States;
                          (ii) the States will be provided an 
                        opportunity to submit, on a continuing 
                        basis, to the Trade Representative 
                        information and advice with respect to 
                        matters referred to in clause (i); and
                          (iii) the Trade Representative will 
                        take into account the information and 
                        advice received from the States under 
                        clause (ii) when formulating United 
                        States positions regarding matters 
                        referred to in clause (i).
                The Federal Advisory Committee Act (5 U.S.C. 
                App.) shall not apply to the Federal-State 
                consultation process established by this 
                paragraph.
                  (C) Federal-state cooperation in wto dispute 
                settlement.--
                          (i) When a WTO member requests 
                        consultations with the United States 
                        under Article 4 of the Understanding on 
                        Rules and Procedures Governing the 
                        Settlement of Disputes referred to in 
                        section 101(d)(16) (hereafter in this 
                        subsection referred to as the ``Dispute 
                        Settlement Understanding'') concerning 
                        whether the law of a State is 
                        inconsistent with the obligations 
                        undertaken by the United States in any 
                        of the Uruguay Round Agreements, the 
                        Trade Representative shall notify the 
                        Governor of the State or the Governor's 
                        designee, and the chief legal officer 
                        of the jurisdiction whose law is the 
                        subject of the consultations, as soon 
                        as possible after the request is 
                        received, but in no event later than 7 
                        days thereafter.
                          (ii) Not later than 30 days after 
                        receiving such a request for 
                        consultations, the Trade Representative 
                        shall consult with representatives of 
                        the State concerned regarding the 
                        matter. If the consultations involve 
                        the laws of a large number of States, 
                        the Trade Representative may consult 
                        with an appropriate group of 
                        representatives of the States 
                        concerned, as determined by those 
                        States.
                          (iii) The Trade Representative shall 
                        make every effort to ensure that the 
                        State concerned is involved in the 
                        development of the position of the 
                        United States at each stage of the 
                        consultations and each subsequent stage 
                        of dispute settlement proceedings 
                        regarding the matter. In particular, 
                        the Trade Representative shall--
                                  (I) notify the State 
                                concerned not later than 7 days 
                                after a WTO member requests the 
                                establishment of a dispute 
                                settlement panel or gives 
                                notice of the WTO member's 
                                decision to appeal a report by 
                                a dispute settlement panel 
                                regarding the matter; and
                                  (II) provide the State 
                                concerned with the opportunity 
                                to advise and assist the Trade 
                                Representative in the 
                                preparation of factual 
                                information and argumentation 
                                for any written or oral 
                                presentations by the United 
                                States in consultations or in 
                                proceedings of a panel or the 
                                Appellate Body regarding the 
                                matter.
                          (iv) If a dispute settlement panel or 
                        the Appellate Body finds that the law 
                        of a State is inconsistent with any of 
                        the Uruguay Round Agreements, the Trade 
                        Representative shall consult with the 
                        State concerned in an effort to develop 
                        a mutually agreeable response to the 
                        report of the panel or the Appellate 
                        Body and shall make every effort to 
                        ensure that the State concerned is 
                        involved in the development of the 
                        United States position regarding the 
                        response.
                  (D) Notice to states regarding consultations 
                on foreign subcentral government laws.--
                          (i) Subject to clause (ii), the Trade 
                        Representative shall, at least 30 days 
                        before making a request for 
                        consultations under Article 4 of the 
                        Dispute Settlement Understanding 
                        regarding a subcentral government 
                        measure of another WTO member, notify, 
                        and solicit the views of, appropriate 
                        representatives of each State regarding 
                        the matter.
                          (ii) In exigent circumstances clause 
                        (i) shall not apply, in which case the 
                        Trade Representative shall notify the 
                        appropriate representatives of each 
                        State not later than 3 days after 
                        making the request for consultations 
                        referred to in clause (i).
          (2) Legal challenge.--
                  (A) In general.--No State law, or the 
                application of such a State law, may be 
                declared invalid as to any person or 
                circumstance on the ground that the provision 
                or application is inconsistent with any of the 
                Uruguay Round Agreements, except in an action 
                brought by the United States for the purpose of 
                declaring such law or application invalid.
                  (B) Procedures governing action.--In any 
                action described in subparagraph (A) that is 
                brought by the United States against a State or 
                any subdivision thereof--
                          (i) a report of a dispute settlement 
                        panel or the Appellate Body convened 
                        under the Dispute Settlement 
                        Understanding regarding the State law, 
                        or the law of any political subdivision 
                        thereof, shall not be considered as 
                        binding or otherwise accorded 
                        deference;
                          (ii) the United States shall have the 
                        burden of proving that the law that is 
                        the subject of the action, or the 
                        application of that law, is 
                        inconsistent with the agreement in 
                        question;
                          (iii) any State whose interests may 
                        be impaired or impeded in the action 
                        shall have the unconditional right to 
                        intervene in the action as a party, and 
                        the United States shall be entitled to 
                        amend its complaint to include a claim 
                        or cross-claim concerning the law of a 
                        State that so intervenes; and
                          (iv) any State law that is declared 
                        invalid shall not be deemed to have 
                        been invalid in its application during 
                        any period before the court's judgment 
                        becomes final and all timely appeals, 
                        including discretionary review, of such 
                        judgment are exhausted.
                  (C) Reports to congressional committees.--At 
                least 30 days before the United States brings 
                an action described in subparagraph (A), the 
                Trade Representative shall provide a report to 
                the Committee on Ways and Means of the House of 
                Representatives and the Committee on Finance of 
                the Senate--
                          (i) describing the proposed action;
                          (ii) describing efforts by the Trade 
                        Representative to resolve the matter 
                        with the State concerned by other 
                        means; and
                          (iii) if the State law was the 
                        subject of consultations under the 
                        Dispute Settlement Understanding, 
                        certifying that the Trade 
                        Representative has substantially 
                        complied with the requirement of 
                        paragraph (1)(C) in connection with the 
                        matter.
                Following the submission of the report, and 
                before the action is brought, the Trade 
                Representative shall consult with the 
                committees referred to in the preceding 
                sentence concerning the matter.
          (3) Definition of state law.--For purposes of this 
        subsection--
                  (A) the term ``State law'' includes--
                          (i) any law of a political 
                        subdivision of a State; and
                          (ii) any State law regulating or 
                        taxing the business of insurance; and
                  (B) the terms ``dispute settlement panel'' 
                and ``Appellate Body'' have the meanings given 
                those terms in section 121.
    (c) Effect of Agreement With Respect to Private Remedies.--
          (1) Limitations.--No person other than the United 
        States--
                  (A) shall have any cause of action or defense 
                under any of the Uruguay Round Agreements or by 
                virtue of congressional approval of such an 
                agreement, or
                  (B) may challenge, in any action brought 
                under any provision of law, any action or 
                inaction by any department, agency, or other 
                instrumentality of the United States, any 
                State, or any political subdivision of a State 
                on the ground that such action or inaction is 
                inconsistent with such agreement.
          (2) Intent of congress.--It is the intention of the 
        Congress through paragraph (1) to occupy the field with 
        respect to any cause of action or defense under or in 
        connection with any of the Uruguay Round Agreements, 
        including by precluding any person other than the 
        United States from bringing any action against any 
        State or political subdivision thereof or raising any 
        defense to the application of State law under or in 
        connection with any of the Uruguay Round Agreements--
                  (A) on the basis of a judgment obtained by 
                the United States in an action brought under 
                any such agreement; or
                  (B) on any other basis.
    (d) Statement of Administrative Action.--The statement of 
administrative action approved by the Congress under section 
101(a) shall be regarded as an authoritative expression by the 
United States concerning the interpretation and application of 
the Uruguay Round Agreements and this Act in any judicial 
proceeding in which a question arises concerning such 
interpretation or application.

           *       *       *       *       *       *       *


SEC. 111. TARIFF MODIFICATIONS.

    (a) In General.--In addition to the authority provided by 
section 1102 of the Omnibus Trade and Competitiveness Act of 
1988 (19 U.S.C. 2902), the President shall have the authority 
to proclaim--
          (1) such other modification of any duty,
          (2) such other staged rate reduction, or
          (3) such additional duties,
as the President determines to be necessary or appropriate to 
carry out Schedule XX.
  (b) Other Tariff Modifications.--Subject to the consultation 
and layover requirements of section 115, the President may 
proclaim--
          (1) the modification of any duty or staged rate 
        reduction of any duty set forth in Schedule XX if--
                  (A) the United States agrees to such 
                modification or staged rate reduction in a 
                multilateral negotiation under the auspices of 
                the WTO, and
                  (B) such modification or staged rate 
                reduction applies to the rate of duty on an 
                article contained in a tariff category that was 
                the subject of reciprocal duty elimination or 
                harmonization negotiations during the Uruguay 
                Round of multilateral trade negotiations, and
          (2) such modifications as are necessary to correct 
        technical errors in Schedule XX or to make other 
        rectifications to the Schedule.
    (c) Authority To Increase Duties on Articles From Certain 
Countries.--
          (1) In general.--
                  (A) Determination with respect to certain 
                countries.--Notwithstanding section 251 of the 
                Trade Expansion Act of 1962 (19 U.S.C. 1881), 
                after the entry into force of the WTO Agreement 
                with respect to the United States, if the 
                President--
                          (i) determines that a foreign country 
                        (other than a foreign country that is a 
                        WTO member country) is not according 
                        adequate trade benefits to the United 
                        States, including substantially equal 
                        competitive opportunities for the 
                        commerce of the United States, and
                          (ii) consults with the Committee on 
                        Ways and Means of the House of 
                        Representatives and the Committee on 
                        Finance of the Senate,
                the President may proclaim an increase in the 
                rate of duty with respect to any article of 
                such country in accordance with subparagraph 
                (B).
                  (B) Rate of duty described.--The President 
                may proclaim a rate of duty on any article of a 
                country identified under subparagraph (A) that 
                is equal to the greater of--
                          (i) the rate of duty set forth for 
                        such article in the base rate of duty 
                        column of Schedule XX, or
                          (ii) the rate of duty set forth for 
                        such article in the bound rate of duty 
                        column of Schedule XX.
          (2) Termination of increased duties.--The President 
        shall terminate any increase in the rate of duty 
        proclaimed under this subsection by a proclamation 
        which shall be effective on the earlier of--
                  (A) the date set out in such proclamation of 
                termination,
                  (B) the date the WTO Agreement enters into 
                force with respect to the foreign country with 
                respect to which the determination under 
                paragraph (1) was made.
          (3) Publication of determination and termination.--
        The President shall publish in the Federal Register 
        notice of a determination made under paragraph (1) and 
        a termination occurring by reason of paragraph (2).

           *       *       *       *       *       *       *

    (e) Authority To Consolidate Subheadings and Modify Column 
2 Rates of Duty for Tariff Simplification Purposes.--
          (1) In general.--Whenever the HTS column 1 general 
        rates of duty for 2 or more 8-digit subheadings are at 
        the same level and such subheadings are subordinate to 
        a provision required by the International Convention on 
        the Harmonized Commodity Description and Coding System, 
        the President may proclaim, subject to the consultation 
        and layover requirements of section 115, that the goods 
        described in such subheadings be provided for in a 
        single 8-digit subheading of the HTS, and that--
                  (A) the HTS column 1 general rate of duty for 
                such single subheading be the column 1 general 
                rate of duty common to all such subheadings, 
                and
                  (B) the HTS column 2 rate of duty for such 
                single subheading be the highest column 2 rate 
                of duty for such subheadings that is in effect 
                on the day before the effective date of such 
                proclamation.
          (2) Same level of duty.--The provisions of this 
        subsection apply to subheadings described in paragraph 
        (1) that have the same column 1 general rate of duty--
                  (A) on the date of the enactment of this Act, 
                or
                  (B) after such date of enactment as a result 
                of a staged reduction in such column 1 rates of 
                duty.

           *       *       *       *       *       *       *


SEC. 121. DEFINITIONS.

    For purposes of this subtitle:
          (1) Administering authority.--The term 
        ``administering authority'' has the meaning given that 
        term in section 771(1) of the Tariff Act of 1930.
          (2) Appellate body.--The term ``Appellate Body'' 
        means the Appellate Body established under Article 17.1 
        of the Dispute Settlement Understanding.
          (3) Appropriate congressional committees; 
        congressional committees.--
                  (A) Appropriate congressional committees.--
                The term ``appropriate congressional 
                committees'' means the committees referred to 
                in subparagraph (B) and any other committees of 
                the Congress that have jurisdiction involving 
                the matter with respect to which consultations 
                are to be held.
                  (B) Congressional committees.--The term 
                ``congressional committees'' means the 
                Committee on Ways and Means of the House of 
                Representatives and the Committee on Finance of 
                the Senate.
          (4) Dispute settlement panel; panel.--The terms 
        ``dispute settlement panel'' and ``panel'' mean a panel 
        established pursuant to Article 6 of the Dispute 
        Settlement Understanding.
          (5) Dispute settlement body.--The term ``Dispute 
        Settlement Body'' means the Dispute Settlement Body 
        administering the rules and procedures as set forth in 
        the Dispute Settlement Understanding.
          (6) Dispute settlement understanding.--The term 
        ``Dispute Settlement Understanding'' means the 
        Understanding on Rules and Procedures Governing the 
        Settlement of Disputes referred to in section 
        101(d)(16).
          (7) General council.--The term ``General Council'' 
        means the General Council established under paragraph 2 
        of Article IV of the WTO Agreement.
          (8) Ministerial conference.--The term ``Ministerial 
        Conference'' means the Ministerial Conference 
        established under paragraph 1 of Article IV of the WTO 
        Agreement.
          (9) Other terms.--The terms ``Antidumping 
        Agreement'', ``Agreement on Subsidies and 
        Countervailing Measures'', and ``Safeguards Agreement'' 
        mean the agreements referred to in section 101(d)(7), 
        (12), and (13), respectively.

SEC. 122. IMPLEMENTATION OF URUGUAY ROUND AGREEMENTS.

    (a) Decisionmaking.--In the implementation of the Uruguay 
Round Agreements and the functioning of the World Trade 
Organization, it is the objective of the United States to 
ensure that the Ministerial Conference and the General Council 
continue the practice of decisionmaking by consensus followed 
under the GATT 1947, as required by paragraph 1 of article IX 
of the WTO Agreement.
    (b) Consultations With Congressional Committees.--In 
furtherance of the objective set forth in subsection (a), the 
Trade Representative shall consult with the appropriate 
congressional committees before any vote is taken by the 
Ministerial Conference or the General Council relating to--
          (1) the adoption of an interpretation of the WTO 
        Agreement or another multilateral trade agreement,
          (2) the amendment of any such agreement,
          (3) the granting of a waiver of any obligation under 
        any such agreement,
          (4) the adoption of any amendment to the rules or 
        procedures of the Ministerial Conference or the General 
        Council,
          (5) the accession of a state or separate customs 
        territory to the WTO Agreement, or
          (6) the adoption of any other decision,
if the action described in paragraph (1), (2), (3), (4), (5), 
or (6) would substantially affect the rights or obligations of 
the United States under the WTO Agreement or another 
multilateral trade agreement or potentially entails a change in 
Federal or State law.
    (c) Report on Decisions.--
          (1) In general.--Not later than 30 days after the end 
        of any calendar year in which the Ministerial 
        Conference or the General Council adopts by vote any 
        decision to take any action described in paragraph (1), 
        (2), (4), or (6) of subsection (b), the Trade 
        Representative shall submit a report to the appropriate 
        congressional committees describing--
                  (A) the nature of the decision;
                  (B) the efforts made by the United States to 
                have the matter decided by consensus pursuant 
                to paragraph 1 of article IX of the WTO 
                Agreement and the results of those efforts;
                  (C) which countries voted for, and which 
                countries voted against, the decision;
                  (D) the rights or obligations of the United 
                States affected by the decision and any Federal 
                or State law that would be amended or repealed, 
                if the President after consultation with the 
                Congress determined that such amendment or 
                repeal was an appropriate response; and
                  (E) the action the President intends to take 
                in response to the decision or, if the 
                President does not intend to take any action, 
                the reasons therefor.
          (2) Additional reporting requirements.--
                  (A) Grant of waiver.--In the case of a 
                decision to grant a waiver described in 
                subsection (b)(3), the report under paragraph 
                (1) shall describe the terms and conditions of 
                the waiver and the rights and obligations of 
                the United States that are affected by the 
                waiver.
                  (B) Accession.--In the case of a decision on 
                accession described in subsection (b)(5), the 
                report under paragraph (1) shall state whether 
                the United States intends to invoke Article 
                XIII of the WTO Agreement.
    (d) Consultation on Report.--Promptly after the submission 
of a report under subsection (c), the Trade Representative 
shall consult with the appropriate congressional committees 
with respect to the report.

SEC. 123. DISPUTE SETTLEMENT PANELS AND PROCEDURES.

    (a) Review by President.--The President shall review 
annually the WTO panel roster and shall include the panel 
roster and the list of persons serving on the Appellate Body in 
the annual report submitted by the President under section 
163(a) of the Trade Act of 1974.
    (b) Qualifications of Appointees to Panels.--The Trade 
Representative shall--
          (1) seek to ensure that persons appointed to the WTO 
        panel roster are well-qualified, and that the roster 
        includes persons with expertise in the subject areas 
        covered by the Uruguay Round Agreements; and
          (2) inform the President of persons nominated to the 
        roster by other WTO member countries.
    (c) Rules Governing Conflicts of Interest.--The Trade 
Representative shall seek the establishment by the General 
Council and the Dispute Settlement Body of rules governing 
conflicts of interest by persons serving on panels and members 
of the Appellate Body and shall describe, in the annual report 
submitted under section 124, any progress made in establishing 
such rules.
    (d) Notification of Disputes.--Promptly after a dispute 
settlement panel is established to consider the consistency of 
Federal or State law with any of the Uruguay Round Agreements, 
the Trade Representative shall notify the appropriate 
congressional committees of--
          (1) the nature of the dispute, including the matters 
        set forth in the request for the establishment of the 
        panel, the legal basis of the complaint, and the 
        specific measures, in particular any State or Federal 
        law cited in the request for establishment of the 
        panel;
          (2) the identity of the persons serving on the panel; 
        and
          (3) whether there was any departure from the rule of 
        consensus with respect to the selection of persons to 
        serve on the panel.
    (e) Notice of Appeals of Panel Reports.--If an appeal is 
taken of a report of a panel in a proceeding described in 
subsection (d), the Trade Representative shall, promptly after 
the notice of appeal is filed, notify the appropriate 
congressional committees of--
          (1) the issues under appeal; and
          (2) the identity of the persons serving on the 
        Appellate Body who are reviewing the report of the 
        panel.
    (f) Actions Upon Circulation of Reports.--Promptly after 
the circulation of a report of a panel or of the Appellate Body 
to WTO members in a proceeding described in subsection (d), the 
Trade Representative shall--
          (1) notify the appropriate congressional committees 
        of the report;
          (2) in the case of a report of a panel, consult with 
        the appropriate congressional committees concerning the 
        nature of any appeal that may be taken of the report; 
        and
          (3) if the report is adverse to the United States, 
        consult with the appropriate congressional committees 
        concerning whether to implement the report's 
        recommendation and, if so, the manner of such 
        implementation and the period of time needed for such 
        implementation.
    (g) Requirements for Agency Action.--
          (1) Changes in agency regulations or practice.--In 
        any case in which a dispute settlement panel or the 
        Appellate Body finds in its report that a regulation or 
        practice of a department or agency of the United States 
        is inconsistent with any of the Uruguay Round 
        Agreements, that regulation or practice may not be 
        amended, rescinded, or otherwise modified in the 
        implementation of such report unless and until--
                  (A) the appropriate congressional committees 
                have been consulted under subsection (f);
                  (B) the Trade Representative has sought 
                advice regarding the modification from relevant 
                private sector advisory committees established 
                under section 135 of the Trade Act of 1974 (19 
                U.S.C. 2155);
                  (C) the head of the relevant department or 
                agency has provided an opportunity for public 
                comment by publishing in the Federal Register 
                the proposed modification and the explanation 
                for the modification;
                  (D) the Trade Representative has submitted to 
                the appropriate congressional committees a 
                report describing the proposed modification, 
                the reasons for the modification, and a summary 
                of the advice obtained under subparagraph (B) 
                with respect to the modification;
                  (E) the Trade Representative and the head of 
                the relevant department or agency have 
                consulted with the appropriate congressional 
                committees on the proposed contents of the 
                final rule or other modification; and
                  (F) the final rule or other modification has 
                been published in the Federal Register.
          (2) Effective date of modification.--A final rule or 
        other modification to which paragraph (1) applies may 
        not go into effect before the end of the 60-day period 
        beginning on the date on which consultations under 
        paragraph (1)(E) begin, unless the President determines 
        that an earlier effective date is in the national 
        interest.
          (3) Vote by congressional committees.--During the 60-
        day period described in paragraph (2), the Committee on 
        Ways and Means of the House of Representatives and the 
        Committee on Finance of the Senate may vote to indicate 
        the agreement or disagreement of the committee with the 
        proposed contents of the final rule or other 
        modification. Any such vote shall not be binding on the 
        department or agency which is implementing the rule or 
        other modification.
          (4) Inapplicability to itc.--This subsection does not 
        apply to any regulation or practice of the 
        International Trade Commission.
    (h) Consultations Regarding Review of WTO Rules and 
Procedures.--Before the review is conducted of the dispute 
settlement rules and procedures of the WTO that is provided for 
in the Decision on the Application of the Understanding on 
Rules and Procedures Governing the Settlement of Disputes, as 
such decision is set forth in the Ministerial Declarations and 
Decisions adopted on April 15, 1994, together with the Uruguay 
Round Agreements, the Trade Representative shall consult with 
congressional committees regarding the policy of the United 
States concerning the review.

SEC. 124. ANNUAL REPORT ON THE WTO.

    Not later than March 1 of each year beginning in 1996, the 
Trade Representative shall submit to the Congress a report 
describing, for the preceding fiscal year of the WTO--
          (1) the major activities and work programs of the 
        WTO, including the functions and activities of the 
        committees established under article IV of the WTO 
        Agreement, and the expenditures made by the WTO in 
        connection with those activities and programs;
          (2) the percentage of budgetary assessments by the 
        WTO that were accounted for by each WTO member country, 
        including the United States;
          (3) the total number of personnel employed or 
        retained by the Secretariat of the WTO, and the number 
        of professional, administrative, and support staff of 
        the WTO;
          (4) for each personnel category described in 
        paragraph (3), the number of citizens of each country, 
        and the average salary of the personnel, in that 
        category;
          (5) each report issued by a panel or the Appellate 
        Body in a dispute settlement proceeding regarding 
        Federal or State law, and any efforts by the Trade 
        Representative to provide for implementation of the 
        recommendations contained in a report that is adverse 
        to the United States;
          (6) each proceeding before a panel or the Appellate 
        Body that was initiated during that fiscal year 
        regarding Federal or State law, the status of the 
        proceeding, and the matter at issue;
          (7) the status of consultations with any State whose 
        law was the subject of a report adverse to the United 
        States that was issued by a panel or the Appellate 
        Body; and
          (8) any progress achieved in increasing the 
        transparency of proceedings of the Ministerial 
        Conference and the General Council, and of dispute 
        settlement proceedings conducted pursuant to the 
        Dispute Settlement Understanding.

SEC. 125. REVIEW OF PARTICIPATION IN THE WTO.

    (a) Report on the Operation of the WTO.--The first annual 
report submitted to the Congress under section 124--
          (1) after the end of the 5-year period beginning on 
        the date on which the WTO Agreement enters into force 
        with respect to the United States, and
          (2) after the end of every 5-year period thereafter,
shall include an analysis of the effects of the WTO Agreement 
on the interests of the United States, the costs and benefits 
to the United States of its participation in the WTO, and the 
value of the continued participation of the United States in 
the WTO.
    (b) Congressional Disapproval of U.S. Participation in the 
WTO.--
          (1) General rule.--The approval of the Congress, 
        provided under section 101(a), of the WTO Agreement 
        shall cease to be effective if, and only if, a joint 
        resolution described in subsection (c) is enacted into 
        law pursuant to the provisions of paragraph (2).
          (2) Procedural provisions.--(A) The requirements of 
        this paragraph are met if the joint resolution is 
        enacted under subsection (c), and
                  (i) the Congress adopts and transmits the 
                joint resolution to the President before the 
                end of the 90-day period (excluding any day 
                described in section 154(b) of the Trade Act of 
                1974), beginning on the date on which the 
                Congress receives a report referred to in 
                subsection (a), and
                  (ii) if the President vetoes the joint 
                resolution, each House of Congress votes to 
                override that veto on or before the later of 
                the last day of the 90-day period referred to 
                in clause (i) or the last day of the 15-day 
                period (excluding any day described in section 
                154(b) of the Trade Act of 1974) beginning on 
                the date on which the Congress receives the 
                veto message from the President.
          (B) A joint resolution to which this section applies 
        may be introduced at any time on or after the date on 
        which the President transmits to the Congress a report 
        described in subsection (a), and before the end of the 
        90-day period referred to in subparagraph (A).
    (c) Joint Resolutions.--
          (1) Joint resolutions.--For purposes of this section, 
        the term ``joint resolution'' means only a joint 
        resolution of the 2 Houses of Congress, the matter 
        after the resolving clause of which is as follows: 
        ``That the Congress withdraws its approval, provided 
        under section 101(a) of the Uruguay Round Agreements 
        Act, of the WTO Agreement as defined in section 2(9) of 
        that Act.''.
          (2) Procedures.--(A) Joint resolutions may be 
        introduced in either House of the Congress by any 
        member of such House.
          (B) Subject to the provisions of this subsection, the 
        provisions of subsections (b), (d), (e), and (f) of 
        section 152 of the Trade Act of 1974 (19 U.S.C. 
        2192(b), (d), (e), and (f)) apply to joint resolutions 
        to the same extent as such provisions apply to 
        resolutions under such section.
          (C) If the committee of either House to which a joint 
        resolution has been referred has not reported it by the 
        close of the 45th day after its introduction (excluding 
        any day described in section 154(b) of the Trade Act of 
        1974), such committee shall be automatically discharged 
        from further consideration of the joint resolution and 
        it shall be placed on the appropriate calendar.
          (D) It is not in order for--
                  (i) the Senate to consider any joint 
                resolution unless it has been reported by the 
                Committee on Finance or the committee has been 
                discharged under subparagraph (C); or
                  (ii) the House of Representatives to consider 
                any joint resolution unless it has been 
                reported by the Committee on Ways and Means or 
                the committee has been discharged under 
                subparagraph (C).
          (E) A motion in the House of Representatives to 
        proceed to the consideration of a joint resolution may 
        only be made on the second legislative day after the 
        calendar day on which the Member making the motion 
        announces to the House his or her intention to do so.
          (3) Consideration of second resolution not in 
        order.--It shall not be in order in either the House of 
        Representatives or the Senate to consider a joint 
        resolution (other than a joint resolution received from 
        the other House), if that House has previously adopted 
        a joint resolution under this section.
    (d) Rules of House of Representatives and Senate.--This 
section is enacted by the Congress--
          (1) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such is deemed a part of the rules of each 
        House, respectively, and such procedures supersede 
        other rules only to the extent that they are 
        inconsistent with such other rules; and
          (2) with the full recognition of the constitutional 
        right of either House to change the rules (so far as 
        relating to the procedures of that House) at any time, 
        in the same manner, and to the same extent as any other 
        rule of that House.

SEC. 126. INCREASED TRANSPARENCY.

    The Trade Representative shall seek the adoption by the 
Ministerial Conference and General Council of procedures that 
will ensure broader application of the principle of 
transparency and clarification of the costs and benefits of 
trade policy actions, through the observance of open and 
equitable procedures in trade matters by the Ministerial 
Conference and the General Council, and by the dispute 
settlement panels and the Appellate Body under the Dispute 
Settlement Understanding.

SEC. 127. ACCESS TO THE WTO DISPUTE SETTLEMENT PROCESS.

    (a) In General.--Whenever the United States is a party 
before a dispute settlement panel established pursuant to 
Article 6 of the Dispute Settlement Understanding, the Trade 
Representative shall, at each stage of the proceeding before 
the panel or the Appellate Body, consult with the appropriate 
congressional committees, the petitioner (if any) under section 
302(a) of the Trade Act of 1974 (19 U.S.C. 2412) with respect 
to the matter that is the subject of the proceeding, and 
relevant private sector advisory committees established under 
section 135 of the Trade Act of 1974 (19 U.S.C. 2155), and 
shall consider the views of representatives of appropriate 
interested private sector and nongovernmental organizations 
concerning the matter.
    (b) Notice and Public Comment.--In any proceeding described 
in subsection (a), the Trade Representative shall--
          (1) promptly after requesting the establishment of a 
        panel, or receiving a request from another WTO member 
        country for the establishment of a panel, publish a 
        notice in the Federal Register--
                  (A) identifying the initial parties to the 
                dispute,
                  (B) setting forth the major issues raised by 
                the country requesting the establishment of a 
                panel and the legal basis of the complaint,
                  (C) identifying the specific measures, 
                including any State or Federal law cited in the 
                request for establishment of the panel, and
                  (D) seeking written comments from the public 
                concerning the issues raised in the dispute; 
                and
          (2) take into account any advice received from 
        appropriate congressional committees and relevant 
        private sector advisory committees referred to in 
        subsection (a), and written comments received pursuant 
        to paragraph (1)(D), in preparing United States 
        submissions to the panel or the Appellate Body.
    (c) Access to Documents.--In each proceeding described in 
subsection (a), the Trade Representative shall--
          (1) make written submissions by the United States 
        referred to in subsection (b) available to the public 
        promptly after they are submitted to the panel or 
        Appellate Body, except that the Trade Representative is 
        authorized to withhold from disclosure any information 
        contained in such submissions identified by the 
        provider of the information as proprietary information 
        or information treated as confidential by a foreign 
        government;
          (2) request each other party to the dispute to permit 
        the Trade Representative to make that party's written 
        submissions to the panel or the Appellate Body 
        available to the public; and
          (3) make each report of the panel or the Appellate 
        Body available to the public promptly after it is 
        circulated to WTO members, and inform the public of 
        such availability.
    (d) Requests for Nonconfidential Summaries.--In any dispute 
settlement proceeding conducted pursuant to the Dispute 
Settlement Understanding, the Trade Representative shall 
request each party to the dispute to provide nonconfidential 
summaries of its written submissions, if that party has not 
made its written submissions public, and shall make those 
summaries available to the public promptly after receiving 
them.
    (e) Public File.--The Trade Representative shall maintain a 
file accessible to the public on each dispute settlement 
proceeding to which the United States is a party that is 
conducted pursuant to the Dispute Settlement Understanding. The 
file shall include all United States submissions in the 
proceeding and a listing of any submissions to the Trade 
Representative from the public with respect to the proceeding, 
as well as the report of the dispute settlement panel and the 
report of the Appellate Body.
    [(f) Conforming Amendment.--Amends section 135(a)(1)(B) of 
the Trade Act of 1974, reprinted elsewhere.]

[SEC. 128. ADVISORY COMMITTEE PARTICIPATION.

    [Amends section 135(b)(1) of the Trade Act of 1974, 
reprinted elsewhere.]

SEC. 129. ADMINISTRATIVE ACTION FOLLOWING WTO PANEL REPORTS.

      (a) Action by United States International Trade 
Commission.--
          (1) Advisory report.--If a dispute settlement panel 
        finds in an interim report under Article 15 of the 
        Dispute Settlement Understanding, or the Appellate Body 
        finds in a report under Article 17 of that 
        Understanding, that an action by the International 
        Trade Commission in connection with a particular 
        proceeding is not in conformity with the obligations of 
        the United States under the Antidumping Agreement, the 
        Safeguards Agreement, or the Agreement on Subsidies and 
        Countervailing Measures, the Trade Representative may 
        request the Commission to issue an advisory report on 
        whether title VII of the Tariff Act of 1930 or title II 
        of the Trade Act of 1974, as the case may be, permits 
        the Commission to take steps in connection with the 
        particular proceeding that would render its action not 
        inconsistent with the findings of the panel or the 
        Appellate Body concerning those obligations. The Trade 
        Representative shall notify the congressional 
        committees of such request.
          (2) Time limits for report.--The Commission shall 
        transmit its report under paragraph (1) to the Trade 
        Representative--
                  (A) in the case of an interim report 
                described in paragraph (1), within 30 calendar 
                days after the Trade Representative requests 
                the report; and
                  (B) in the case of a report of the Appellate 
                Body, within 21 calendar days after the Trade 
                Representative requests the report.
          (3) Consultations on request for commission 
        determination.--If a majority of the Commissioners 
        issues an affirmative report under paragraph (1), the 
        Trade Representative shall consult with the 
        congressional committees concerning the matter.
          (4) Commission determination.--Notwithstanding any 
        provision of the Tariff Act of 1930 or title II of the 
        Trade Act of 1974, if a majority of the Commissioners 
        issues an affirmative report under paragraph (1), the 
        Commission, upon the written request of the Trade 
        Representative, shall issue a determination in 
        connection with the particular proceeding that would 
        render the Commission's action described in paragraph 
        (1) not inconsistent with the findings of the panel or 
        Appellate Body. The Commission shall issue its 
        determination not later than 120 days after the request 
        from the Trade Representative is made.
          (5) Consultations on implementation of commission 
        determination.--The Trade Representative shall consult 
        with the congressional committees before the 
        Commission's determination under paragraph (4) is 
        implemented.
          (6) Revocation of order.--If, by virtue of the 
        Commission's determination under paragraph (4), an 
        antidumping or countervailing duty order with respect 
        to some or all of the imports that are subject to the 
        action of the Commission described in paragraph (1) is 
        no longer supported by an affirmative Commission 
        determination under title VII of the Tariff Act of 1930 
        or this subsection, the Trade Representative may, after 
        consulting with the congressional committees under 
        paragraph (5), direct the administering authority to 
        revoke the antidumping or countervailing duty order in 
        whole or in part.
          (7) Modification of action under title ii of trade 
        act of 1974.--Section 204(b) of the Trade Act of 1974 
        (19 U.S.C. 2254(b)) is amended by adding at the end the 
        following new paragraph:
          ``(3) Notwithstanding paragraph (1), the President 
        may, after receipt of a Commission determination under 
        section 129(a)(4) of the Uruguay Round Agreements Act 
        and consulting with the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate, reduce, modify, or terminate 
        action taken under section 203.''.
      (b) Action by Administering Authority.--
          (1) Consultations with administering authority and 
        congressional committees.--Promptly after a report by a 
        dispute settlement panel or the Appellate Body is 
        issued that contains findings that an action by the 
        administering authority in a proceeding under title VII 
        of the Tariff Act of 1930 is not in conformity with the 
        obligations of the United States under the Antidumping 
        Agreement or the Agreement on Subsidies and 
        Countervailing Measures, the Trade Representative shall 
        consult with the administering authority and the 
        congressional committees on the matter.
          (2) Determination by administering authority.--
        Notwithstanding any provision of the Tariff Act of 
        1930, the administering authority shall, within 180 
        days after receipt of a written request from the Trade 
        Representative, issue a determination in connection 
        with the particular proceeding that would render the 
        administering authority's action described in paragraph 
        (1) not inconsistent with the findings of the panel or 
        the Appellate Body.
          (3) Consultations before implementation.--Before the 
        administering authority implements any determination 
        under paragraph (2), the Trade Representative shall 
        consult with the administering authority and the 
        congressional committees with respect to such 
        determination.
          (4) Implementation of determination.--The Trade 
        Representative may, after consulting with the 
        administering authority and the congressional 
        committees under paragraph (3), direct the 
        administering authority to implement, in whole or in 
        part, the determination made under paragraph (2).
      (c) Effects of Determinations; Notice of 
Implementation.--
          (1) Effects of determinations.--Determinations 
        concerning title VII of the Tariff Act of 1930 that are 
        implemented under this section shall apply with respect 
        to unliquidated entries of the subject merchandise (as 
        defined in section 771 of that Act) that are entered, 
        or withdrawn from warehouse, for consumption on or 
        after--
                  (A) in the case of a determination by the 
                Commission under subsection (a)(4), the date on 
                which the Trade Representative directs the 
                administering authority under subsection (a)(6) 
                to revoke an order pursuant to that 
                determination, and
                  (B) in the case of a determination by the 
                administering authority under subsection 
                (b)(2), the date on which the Trade 
                Representative directs the administering 
                authority under subsection (b)(4) to implement 
                that determination.
          (2) Notice of implementation.--
                  (A) The administering authority shall publish 
                in the Federal Register notice of the 
                implementation of any determination made under 
                this section with respect to title VII of the 
                Tariff Act of 1930.
                  (B) The Trade Representative shall publish in 
                the Federal Register notice of the 
                implementation of any determination made under 
                this section with respect to title II of the 
                Trade Act of 1974.
      (d) Opportunity for Comment by Interested Parties.--Prior 
to issuing a determination under this section, the 
administering authority or the Commission, as the case may be, 
shall provide interested parties with an opportunity to submit 
written comments and, in appropriate cases, may hold a hearing, 
with respect to the determination.

                C. SPECIFIC TRADE AGREEMENT AUTHORITIES


                       1. Compensation Authority


            Section 123 of the Trade Act of 1974, as amended


       [19 U.S.C. 2133; P.L. 93-618, as amended by P.L. 100-418]

SEC. 123. COMPENSATION AUTHORITY.

    (a) Whenever--
          (1) any action taken under chapter 1 of title II or 
        chapter 1 of title III; or
          (2) any judicial or administrative tariff 
        reclassification that becomes final after the date of 
        the enactment of the Omnibus Trade and Competitiveness 
        Act of 1988;
increases or imposes any duty or other import restriction, the 
President--
          (A) may enter into trade agreements with foreign 
        countries or instrumentalities for the purpose of 
        granting new concessions as compensation in order to 
        maintain the general level of reciprocal and mutually 
        advantageous concessions; and
          (B) may proclaim such modification or continuance of 
        any existing duty, or such continuance of existing 
        duty-free or excise treatment, as he determines to be 
        required or appropriate to carry out any such 
        agreement.
    (b)(1) No proclamation shall be made pursuant to subsection 
(a) decreasing any rate of duty to a rate which is less than 70 
percent of the existing rate of duty.
    (2) Where the rate of duty in effect at any time is an 
intermediate stage under section 1102(a) of the Omnibus Trade 
and Competitiveness Act of 1988, the proclamation made pursuant 
to subsection (a) may provide for the reduction of each rate of 
duty at each such stage proclaimed under section 1102(a) by not 
more than 30 percent of such rate of duty, and may provide for 
a final rate of duty which is not less than 70 percent of the 
rate of duty proclaimed as the final stage under section 
1102(a).
    (3) If the President determines that such action will 
simplify the computation of the amount of duty imposed with 
respect to an article, he may exceed the limitations provided 
by paragraphs (1) and (2) of this subsection by not more than 
the lesser of--
          (A) the difference between such limitation and the 
        next lower whole number, or
          (B) one-half of 1 percent ad valorem.
    (4) Any concessions granted under subsection (a)(1) shall 
be reduced and terminated according to substantially the same 
time schedule for reduction applicable to the relevant action 
under sections 203(e) and 204.
    (c) Before entering into any trade agreement under this 
section with any foreign country or instrumentality, the 
President shall consider whether such country or 
instrumentality has violated trade concessions of benefit to 
the United States and such violation has not been adequately 
offset by the action of the United States or by such country or 
instrumentality.
    (d) Notwithstanding the provisions of subsection (a), the 
authority delegated under section 1102 of the Omnibus Trade and 
Competitiveness Act of 1988 shall be used for the purpose of 
granting new concessions as compensation within the meaning of 
this section until such authority terminates.
    (e) The provisions of this section shall apply by reason of 
action taken under chapter 1 of title III only if the President 
determines that action authorized under this section is 
necessary or appropriate to meet the international obligations 
of the United States.

                2. Termination and Withdrawal Authority


                  Section 125 of the Trade Act of 1974


                     [19 U.S.C. 2135; P.L. 93-618]

SEC. 125. TERMINATION AND WITHDRAWAL AUTHORITY.

    (a) Grant of Authority for Termination or Withdrawal at end 
of Period Specified in Agreement.--Every trade agreement 
entered into under this Act shall be subject to termination, in 
whole or in part, or withdrawal, upon due notice, at the end of 
a period specified in the agreement. Such period shall be not 
more than 3 years from the date on which the agreement becomes 
effective. If the agreement is not terminated or withdrawn from 
at the end of the period so specified, it shall be subject to 
termination or withdrawal thereafter upon not more than 6 
months' notice.
    (b) Authority To Terminate Proclamations at Any Time.--The 
President may at any time terminate, in whole or in part, any 
proclamation made under this Act.
    (c) Increased Duties or Other Import Restrictions Following 
Withdrawal, Suspension, or Modification of Obligations with 
Respect to Trade of Foreign Countries or Instrumentalities.--
Whenever the United States, acting in pursuance of any of its 
rights or obligations under any trade agreement entered into 
pursuant to this Act, section 201 of the Trade Expansion Act of 
1962, or section 350 of the Tariff Act of 1930, withdraws, 
suspends, or modifies any obligation with respect to the trade 
of any foreign country or instrumentality thereof, the 
President is authorized to proclaim increased duties or other 
import restrictions, to the extent, at such times, and for such 
periods as he deems necessary or appropriate, in order to 
exercise the rights or fulfill the obligations of the United 
States. No proclamation shall be made under this subsection 
increasing any existing duty to a rate more than 50 percent 
above the rate set forth in rate column numbered 2 of the 
Tariff Schedules of the United States, as in effect on January 
1, 1975, or 20 percent ad valorem above the rate existing on 
January 1, 1975, whichever is higher.
    [Section 421 of the Uruguay Round Agreements Act provides 
that in the application of section 125(c) of the Trade Act of 
1974 (19 U.S.C. 2135) with respect to any item provided for in 
subheadings 2401.10.60, 2401.20.30, 2401.20.80, 2401.30.30, 
2401.30.60, 2401.30.90, 2403.10.00, 2403.91.40, or 2403.99.00 
of the HTS, ``350'' shall be substituted for ``20'' where it 
appears in such section.]
    (d) Retaliatory Authority.--Whenever any foreign country or 
instrumentality withdraws, suspends, or modifies the 
application of trade agreement obligations of benefit to the 
United States without granting adequate compensation therefor, 
the President, in pursuance of rights granted to the United 
States under any trade agreement and to the extent necessary to 
protect United States economic interests (including United 
States balance of payments), may--
          (1) withdraw, suspend, or modify the application of 
        substantially equivalent trade agreement obligations of 
        benefit to such foreign country or instrumentality; and
          (2) proclaim under subsection (c) such increased 
        duties or other import restrictions as are appropriate 
        to effect adequate compensation from such foreign 
        country or instrumentality.
    (e) Continuation of Duties or Other Import Restrictions 
After Termination of or Withdrawal from Agreements.--Duties or 
other import restrictions required or appropriate to carry out 
any trade agreement entered into pursuant to this Act, section 
201 of the Trade Expansion Act of 1962, or section 350 of the 
Tariff Act of 1930 shall not be affected by any termination, in 
whole or in part, of such agreement or by the withdrawal of the 
United States from such agreement and shall remain in effect 
after the date of such termination or withdrawal for 1 year, 
unless the President by proclamation provides that such rates 
shall be restored to the level at which they would be but for 
the agreement. Within 60 days after the date of any such 
termination or withdrawal, the President shall transmit to the 
Congress his recommendations as to the appropriate rates of 
duty for all articles which were affected by the termination or 
withdrawal or would have been so affected but for the preceding 
sentence.
    (f) Public Hearings.--Before taking any action pursuant to 
subsection (b), (c), or (d), the President shall provide for a 
public hearing during the course of which interested persons 
shall be given a reasonable opportunity to be present, to 
produce evidence, and to be heard, unless he determines that 
such prior hearings will be contrary to the national interest 
because of the need for expeditious action, in which case he 
shall provide for a public hearing promptly after such action.
    [Section 1105(a) of the Omnibus Trade and Competitiveness 
Act of 1988 applies section 125 to trade agreements entered 
into under section 1102 of that Act.]

      3. Accession of State Trading Regimes to the GATT or the WTO


 Section 1106 of the Omnibus Trade and Competitiveness Act of 1988, as 
                                amended


[19 U.S.C. 2905; P.L. 100-418, as amended by P.L. 103-465 and P.L. 104-
                                  295]

SEC. 1106. ACCESSION OF STATE TRADING REGIMES TO THE GENERAL AGREEMENT 
                    ON TARIFFS AND TRADE OR THE WTO.

  (a) In General.--Before any major foreign country accedes, 
after the date of enactment of this Act, to the GATT 1947, or 
the WTO Agreement, the President shall determine--
          (1) whether state trading enterprises account for a 
        significant share of--
                  (A) the exports of such major foreign 
                country, or
                  (B) the goods of such major foreign country 
                that are subject to competition from goods 
                imported into such foreign country; and
          (2) whether such state trading enterprises--
                  (A) unduly burden and restrict, or adversely 
                affect, the foreign trade of the United States 
                or the United States economy, or
                  (B) are likely to result in such a burden, 
                restriction, or effect.
  (b) Effects of Affirmative Determination.--If both of the 
determinations made under paragraphs (1) and (2) of subsection 
(a) with respect to a major foreign country are affirmative--
          (1) the President shall reserve the right of the 
        United States to withhold extension of the application 
        of the GATT 1947 or the WTO Agreement, between the 
        United States and such major foreign country, and
          (2) the GATT 1947 or the WTO Agreement shall not 
        apply between the United States and such major foreign 
        country until--
                  (A) such foreign country enters into an 
                agreement with the United States providing that 
                the state trading enterprises of such foreign 
                country--
                          (i) will--
                                  (I) make purchases which are 
                                not for the use of such foreign 
                                country, and
                                  (II) make sales in 
                                international trade,
                        in accordance with commercial 
                        considerations (including price, 
                        quality, availability, marketability, 
                        and transportation), and
                          (ii) will afford United States 
                        business firms adequate opportunity, in 
                        accordance with customary practice, to 
                        compete for participation in such 
                        purchases or sales; or
                  (B) a bill submitted under subsection (c) 
                which approves of the extension of the 
                application of the GATT 1947 or the WTO 
                Agreement between the United States and such 
                major foreign country is enacted into law.
  (c) Expedited Consideration of Bill To Approve Extension.--
          (1) The President may submit to the Congress any 
        draft of a bill which approves of the extension of the 
        application of the GATT 1947 or the WTO Agreement 
        between the United States and a major foreign country.
          (2) Any draft of a bill described in paragraph (1) 
        that is submitted by the President to the Congress 
        shall--
                  (A) be introduced by the majority leader of 
                each House of the Congress (by request) on the 
                first day on which such House is in session 
                after the date such draft is submitted to the 
                Congress; and
                  (B) shall be treated as an implementing bill 
                for purposes of subsections (d), (e), (f), and 
                (g) of section 151 of the Trade Act of 1974.
  (d) Publication.--The President shall publish in the Federal 
Register each determination made under subsection (a).
    (e) Definitions.--For purposes of this section:
          (1) The term ``GATT 1947'' has the meaning given that 
        term in section 2(1)(A) of the Uruguay Round Agreements 
        Act.
          (2) The term ``WTO Agreement'' means the Agreement 
        Establishing the World Trade Organization entered into 
        on April 15, 1994 and the multilateral trade agreements 
        (as such term is defined in section 2(4) of the Uruguay 
        Round Agreements Act).

                     4. GATT and WTO Authorizations


            Section 121 of the Trade Act of 1974, as amended


 [19 U.S.C. 2131; P.L. 93-618, as amended by P.L. 100-418 and P.L. 100-
                                  647]

SEC. 121. AUTHORIZATION OF APPROPRIATION FOR GATT REVERSION.

    There are authorized to be appropriated annually such sums 
as may be necessary for the payment by the United States of its 
share of the expenses of the Contracting Parties to the General 
Agreement on Tariffs and Trade. This authorization does not 
imply approval or disapproval by the Congress of all articles 
of the General Agreement on Tariffs and Trade.

           Section 101(c) of the Uruguay Round Agreements Act


                     [19 U.S.C. 3511; P.L. 103-465]

SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE URUGUAY ROUND 
                    AGREEMENTS.

    (c) Authorization of Appropriations.--There are authorized 
to be appropriated annually such sums as may be necessary for 
the payment by the United States of its share of the expenses 
of the WTO.

              D. TRADE NEGOTIATION PROCEDURAL REQUIREMENTS


         Sections 131-134 of the Trade Act of 1974, as amended


     [19 U.S.C. 2151-2154; P.L. 93-618, as amended by P.L. 100-418]

SEC. 131. ADVICE FROM INTERNATIONAL TRADE COMMISSION.

  (a) Lists of Articles Which May Be Considered for Action.--
          (1) In connection with any proposed trade agreement 
        under section 123 of this Act or section 1102 (a) or 
        (c) of the Omnibus Trade and Competitiveness Act of 
        1988, the President shall from time to time publish and 
        furnish the International Trade Commission (hereafter 
        in this section referred to as the ``Commission'') with 
        lists of articles which may be considered for 
        modification or continuance of United States duties, 
        continuance of United States duty-free or excise 
        treatment, or additional duties. In the case of any 
        article with respect to which consideration may be 
        given to reducing or increasing the rate of duty, the 
        list shall specify the provision of this subchapter 
        under which such consideration may be given.
          (2) In connection with any proposed trade agreement 
        under section 1102 (b) or (c) of the Omnibus Trade and 
        Competitiveness Act of 1988, the President may from 
        time to time publish and furnish the Commission with 
        lists of nontariff matters which may be considered for 
        modification.
  (b) Advice to President by Commission.--Within 6 months after 
receipt of a list under subsection (a) or, in the case of a 
list submitted in connection with a trade agreement, within 90 
days after receipt of such list, the Commission shall advise 
the President, with respect to each article or nontariff 
matter, of its judgment as to the probable economic effect of 
modification of the tariff or nontariff measure on industries 
producing like or directly competitive articles and on 
consumers, so as to assist the President in making an informed 
judgment as to the impact which might be caused by such 
modifications on United States interests, such as sectors 
involved in manufacturing, agriculture, mining, fishing, 
services, intellectual property, investment, labor, and 
consumers. Such advice may include in the case of any article 
the advice of the Commission as to whether any reduction in the 
rate of duty should take place over a longer period of time 
than the minimum period provided for in section 1102(a)(3)(A).
  (c) Additional Investigations and Reports Requested by the 
President or the Trade Representative.--In addition, in order 
to assist the President in his determination whether to enter 
into any agreement under section 123 of this Act or section 
1102 of the Omnibus Trade and Competitiveness Act of 1988, or 
how to develop trade policy, priorities or other matters (such 
as priorities for actions to improve opportunities in foreign 
markets), the Commission shall make such investigations and 
reports as may be requested by the President or the United 
States Trade Representative on matters such as effects of 
modification of any barrier to (or other distortion of) 
international trade on domestic workers, industries or sectors, 
purchasers, prices and quantities of articles in the United 
States.
  (d) Commission Steps in Preparing Its Advice to the 
President.--In preparing its advice to the President under this 
section, the Commission shall to the extent practicable--
          (1) investigate conditions, causes, and effects 
        relating to competition between the foreign industries 
        producing the articles or services in question and the 
        domestic industries producing the like or directly 
        competitive articles or services;
          (2) analyze the production, trade, and consumption of 
        each like or directly competitive article or service, 
        taking into consideration employment, profit levels, 
        and use of productive facilities with respect to the 
        domestic industries concerned, and such other economic 
        factors in such industries as it considers relevant, 
        including prices, wages, sales, inventories, patterns 
        of demand, capital investment, obsolescence of 
        equipment, and diversification of production;
          (3) describe the probable nature and extent of any 
        significant change in employment, profit levels, and 
        use of productive facilities; the overall impact of 
        such or other possible changes on the competitiveness 
        of relevant domestic industries or sectors; and such 
        other conditions as it deems relevant in the domestic 
        industries or sectors concerned which it believes such 
        modifications would cause; and
          (4) make special studies (including studies of real 
        wages paid in foreign supplying countries), whenever 
        deemed to be warranted, of particular proposed 
        modifications affecting United States manufacturing, 
        agriculture, mining, fishing, labor, consumers, 
        services, intellectual property and investment, using 
        to the fullest extent practicable United States 
        Government facilities abroad and appropriate personnel 
        of the United States.
  (e) Public Hearing.--In preparing its advice to the President 
under this section, the Commission shall, after reasonable 
notice, hold public hearings.

SEC. 132. ADVICE FROM EXECUTIVE DEPARTMENTS AND OTHER SOURCES.

  Before any trade agreement is entered into under section 123 
of this Act or section 1102 of the Omnibus Trade and 
Competitiveness Act of 1988, the President shall seek 
information and advice with respect to such agreement from the 
Departments of Agriculture, Commerce, Defense, Interior, Labor, 
State and the Treasury, from the United States Trade 
Representative, and from such other sources as he may deem 
appropriate. Such advice shall be prepared and presented 
consistent with the provisions of Reorganization Plan Number 3 
of 1979, Executive Order Number 12188 and section 141(c).

SEC. 133. PUBLIC HEARINGS.

  (a) Opportunity for Presentation of Views.--In connection 
with any proposed trade agreement under section 123 of this Act 
or section 1102 of the Omnibus Trade and Competitiveness Act of 
1988, the President shall afford an opportunity for any 
interested person to present his views concerning any article 
on a list published under section 131, any matter or article 
which should be so listed, any concession which should be 
sought by the United States, or any other matter relevant to 
such proposed trade agreement. For this purpose, the President 
shall designate an agency or an interagency committee which 
shall, after reasonable notice, hold public hearings and 
prescribe regulations governing the conduct of such hearings. 
When appropriate, such procedures shall apply to the 
development of trade policy and priorities.
  (b) Summary of Hearings.--The organization holding such 
hearing shall furnish the President with a summary thereof.

SEC. 134. PREREQUISITES FOR OFFERS.

  (a) In any negotiation seeking an agreement under section 123 
of this Act or section 1102 of the Omnibus Trade and 
Competitiveness Act of 1988, the President may make a formal 
offer for the modification or continuance of any United States 
duty, import restrictions, or barriers to (or other distortions 
of) international trade, the continuance of United States duty-
free or excise treatment, or the imposition of additional 
duties, import restrictions, or other barrier to (or other 
distortion of) international trade including trade in services, 
foreign direct investment and intellectual property as covered 
by this title, with respect to any article or matter only after 
he has received a summary of the hearings at which an 
opportunity to be heard with respect to such article has been 
afforded under section 133. In addition, the President may make 
an offer for the modification or continuance of any United 
States duty, the continuance of United States duty-free or 
excise treatment, or the imposition of additional duties, with 
respect to any article included in a list published and 
furnished under section 131(a), only after he has received 
advice concerning such article from the Commission under 
section 131(b), or after the expiration of the 6-month or 90-
day period provided for in that section, as appropriate, 
whichever first occurs.
  (b) In determining whether to make offers described in 
subsection (a) in the course of negotiating any trade agreement 
under section 1102 of the Omnibus Trade and Competitiveness Act 
of 1988, and in determining the nature and scope of such 
offers, the President shall take into account any advice or 
information provided, or reports submitted, by--
          (1) the Commission;
          (2) any advisory committee established under section 
        135; or
          (3) any organization that holds public hearings under 
        section 133;
with respect to any article, or domestic industry, that is 
sensitive, or potentially sensitive, to imports.

            Sections 127(a) and (b) of the Trade Act of 1974


                     [19 U.S.C. 2137; P.L. 93-618]

SEC. 127. RESERVATION OF ARTICLES FOR NATIONAL SECURITY OR OTHER 
                    REASONS.

    (a) National Security Considerations.--No proclamation 
shall be made pursuant to the provisions of this Act reducing 
or eliminating the duty or other import restrictions on any 
article if the President determines that such reduction or 
elimination would threaten to impair the national security.
    (b) Action Taken Under Other Laws.--Where there is in 
effect with respect to any article any action taken under 
section 203 of this Act, or section 232 or 351 of the Trade 
Expansion Act of 1962 (19 U.S.C. 1862 or 1981), the President 
shall reserve such article from negotiations under this title 
(and from any action under section 122(c)) contemplating 
reduction or elimination of--
          (A) any duty on such article,
          (B) any import restriction imposed under such 
        section, or
          (C) any other import restriction, the removal of 
        which will be likely to undermine the effect of the 
        import restrictions referred to in subparagraph (B).
In addition, the President shall also so reserve any other 
article which he determines to be appropriate, taking into 
consideration information and advice available pursuant to and 
with respect to the matters covered by sections 131, 132, and 
133, where applicable.
    [Section 1105(a) of the Omnibus Trade and Competitiveness 
Act of 1988 applies section 127 to trade agreements entered 
into under section 1102 of that Act.]

  E. IDENTIFICATION OF, AND ACTION ON, SPECIFIC FOREIGN TRADE BARRIERS


                   1. National Trade Estimates Report


            Section 181 of the Trade Act of 1974, as amended


 [19 U.S.C. 2241; P.L. 93-618, as added by P.L. 98-573, section 303(a) 
             and amended by P.L. 100-418 and P.L. 103-465]

SEC. 181. ESTIMATES OF BARRIERS TO MARKET ACCESS.

    (a) National Trade Estimates.--
          (1) In general.--For calendar year 1988, and for each 
        succeeding calendar year, the United States Trade 
        Representative, through the interagency trade 
        organization established pursuant to section 242(a) of 
        the Trade Expansion Act of 1962 and with the assistance 
        of the interagency advisory committee established under 
        section 141(d)(2), shall--
                  (A) identify and analyze acts, policies, or 
                practices of each foreign country which 
                constitute significant barriers to, or 
                distortions of--
                          (i) United States exports of goods or 
                        services (including agricultural 
                        commodities; and property protected by 
                        trademarks, patents, and copyrights 
                        exported or licensed by United States 
                        persons), and
                          (ii) foreign direct investment by 
                        United States persons, especially if 
                        such investment has implications for 
                        trade in goods or services;
                  (B) make an estimate of the trade-distorting 
                impact on United States commerce of any act, 
                policy, or practice identified under 
                subparagraph (A); and
                  (C) make an estimate, if feasible, of--
                          (i) the value of additional goods and 
                        services of the United States, and
                          (ii) the value of additional foreign 
                        direct investment by United States 
                        persons,
                that would have been exported to, or invested 
                in, each foreign country during such calendar 
                year if each of such acts, policies, and 
                practices of such country did not exist.
          (2) Certain factors taken into account in making 
        analysis and estimate.--In making any analysis or 
        estimate under paragraph (1), the Trade Representative 
        shall take into account--
                  (A) the relative impact of the act, policy, 
                or practice on United States commerce;
                  (B) the availability of information to 
                document prices, market shares, and other 
                matters necessary to demonstrate the effects of 
                the act, policy, or practice;
                  (C) the extent to which such act, policy, or 
                practice is subject to international agreements 
                to which the United States is a party;
                  (D) any advice given through appropriate 
                committees established pursuant to section 135; 
                and
                  (E) the actual increase in--
                          (i) the value of goods and services 
                        of the United States exported to, and
                          (ii) the value of foreign direct 
                        investment made in,
                the foreign country during the calendar year 
                for which the estimate under paragraph (1)(C) 
                is made.
          (3) Annual revisions and updates.--The Trade 
        Representative shall annually revise and update the 
        analysis and estimate under paragraph (1).
    (b) Report to Congress.--
          (1) On or before April 30, 1989, and on or before 
        March 31 of each succeeding calendar year, the Trade 
        Representative shall submit a report on the analysis 
        and estimates made under subsection (a) for the 
        calendar year preceding such calendar year (which shall 
        be known as the ``National Trade Estimate'') to the 
        President, the Committee on Finance of the Senate, and 
        appropriate committees of the House of Representatives.
          (2) Reports to include information with respect to 
        action being taken.--The Trade Representative shall 
        include in each report submitted under paragraph (1) 
        information with respect to any action taken (or the 
        reasons for no action taken) to eliminate any act, 
        policy, or practice identified under subsection (a), 
        including, but not limited to--
                  (A) any action under section 301,
                  (B) negotiations or consultations with 
                foreign governments, or
                  (C) a section on foreign anticompetitive 
                practices, the toleration of which by foreign 
                governments is adversely affecting exports of 
                United States goods or services.
          (3) Consultation with congress on trade policy 
        priorities.--The Trade Representative shall keep the 
        committees described in paragraph (1) currently 
        informed with respect to trade policy priorities for 
        the purposes of expanding market opportunities. After 
        the submission of the report required by paragraph (1), 
        the Trade Representative shall also consult 
        periodically with, and take into account the views of, 
        the committees described in that paragraph regarding 
        means to address the foreign trade barriers identified 
        in the report, including the possible initiation of 
        investigations under section 302 or other trade 
        actions.
    (c) Assistance of Other Agencies.--
          (1) Furnishing of information.--The head of each 
        department or agency of the executive branch of the 
        Government, including any independent agency, is 
        authorized and directed to furnish to the Trade 
        Representative or to the appropriate agency, upon 
        request, such data, reports, and other information as 
        is necessary for the Trade Representative to carry out 
        his functions under this section. In preparing the 
        section of the report required by subsection (b)(2)(C), 
        the Trade Representative shall consult in particular 
        with the Attorney General.
          (2) Restrictions on release or use of information.--
        Nothing in this subsection shall authorize the release 
        of information to, or the use of information by, the 
        Trade Representative in a manner inconsistent with law 
        or any procedure established pursuant thereto.
          (3) Personnel and services.--The head of any 
        department, agency, or instrumentality of the United 
        States may detail such personnel and may furnish such 
        services, with or without reimbursement, as the Trade 
        Representative may request to assist in carrying out 
        his functions.

                    2. Intellectual Property Rights


            Section 182 of the Trade Act of 1974, as amended


    [19 U.S.C. 2242; P.L. 93-618, as added by P.L. 100-418, section 
 1303(b), and amended by P.L. 103-182, P.L. 103-465, and P.L. 106-113]

SEC. 182. IDENTIFICATION OF COUNTRIES THAT DENY ADEQUATE PROTECTION, OR 
                    MARKET ACCESS, FOR INTELLECTUAL PROPERTY RIGHTS.

  (a) In General.--By no later than the date that is 30 days 
after the date on which the annual report is submitted to 
Congressional committees under section 181(b), the United 
States Trade Representative (hereafter in this section referred 
to as the ``Trade Representative'') shall identify--
          (1) those foreign countries that--
                  (A) deny adequate and effective protection of 
                intellectual property rights, or
                  (B) deny fair and equitable market access to 
                United States persons that rely upon 
                intellectual property protection, and
          (2) those foreign countries identified under 
        paragraph (1) that are determined by the Trade 
        Representative to be priority foreign countries.
  (b) Special Rules for Identifications.--
          (1) In identifying priority foreign countries under 
        subsection (a)(2), the Trade Representative shall only 
        identify those foreign countries--
                  (A) that have the most onerous or egregious 
                acts, policies, or practices that--
                          (i) deny adequate and effective 
                        intellectual property rights, or
                          (ii) deny fair and equitable market 
                        access to United States persons that 
                        rely upon intellectual property 
                        protection,
                  (B) whose acts, policies, or practices 
                described in subparagraph (A) have the greatest 
                adverse impact (actual or potential) on the 
                relevant United States products, and
                  (C) that are not--
                          (i) entering into good faith 
                        negotiations, or
                          (ii) making significant progress in 
                        bilateral or multilateral negotiations,
                to provide adequate and effective protection of 
                intellectual property rights.
          (2) In identifying priority foreign countries under 
        subsection (a)(2), the Trade Representative shall--
                  (A) consult with the Register of Copyrights, 
                the Under Secretary of Commence for 
                Intellectual Property and Director of the 
                United States Patent and Trademark Office, 
                other appropriate officers of the Federal 
                Government, and
                  (B) take into account information from such 
                sources as may be available to the Trade 
                Representative and such information as may be 
                submitted to the Trade Representative by 
                interested persons, including information 
                contained in reports submitted under section 
                181(b) and petitions submitted under section 
                302.
          (3) The Trade Representative may identify a foreign 
        country under subsection (a)(1)(B) only if the Trade 
        Representative finds that there is a factual basis for 
        the denial of fair and equitable market access as a 
        result of the violation of international law or 
        agreement, or the existence of barriers, referred to in 
        subsection (d)(3).
          (4) In identifying foreign countries under paragraphs 
        (1) and (2) of subsection (a), the Trade Representative 
        shall take into account--
                  (A) the history of intellectual property laws 
                and practices of the foreign country, including 
                any previous identification under subsection 
                (a)(2), and
                  (B) the history of efforts of the United 
                States, and the response of the foreign 
                country, to achieve adequate and effective 
                protection and enforcement of intellectual 
                property rights.
  (c) Revocations and Additional Identifications.--
          (1) The Trade Representative may at any time--
                  (A) revoke the identification of any foreign 
                country as a priority foreign country under 
                this section, or
                  (B) identify any foreign country as a 
                priority foreign country under this section,
        if information available to the Trade Representative 
        indicates that such action is appropriate.
          (2) The Trade Representative shall include in the 
        semi-annual report submitted to the Congress under 
        section 309(3) a detailed explanation of the reasons 
        for the revocation under paragraph (1) of the 
        identification of any foreign country as a priority 
        foreign country under this section.
  (d) Definitions.--For purposes of this section--
          (1) The term ``persons that rely upon intellectual 
        property protection'' means persons involved in--
                  (A) the creation, production or licensing of 
                works of authorship (within the meaning of 
                sections 102 and 103 of title 17, United States 
                Code) that are copyrighted, or
                  (B) the manufacture of products that are 
                patented or for which there are process 
                patents.
          (2) A foreign country denies adequate and effective 
        protection of intellectual property rights if the 
        foreign country denies adequate and effective means 
        under the laws of the foreign country for persons who 
        are not citizens or nationals of such foreign country 
        to secure, exercise, and enforce rights relating to 
        patents, process patents, registered trademarks, 
        copyrights and mask works.
          (3) A foreign country denies fair and equitable 
        market access if the foreign country effectively denies 
        access to a market for a product protected by a 
        copyright or related right, patent, trademark, mask 
        work, trade secret, or plant breeder's right, through 
        the use of laws, procedures, practices, or regulations 
        which--
                  (A) violate provisions of international law 
                or international agreements to which both the 
                United States and the foreign country are 
                parties, or
                  (B) constitute discriminatory nontariff trade 
                barriers.
          (4) A foreign country may be determined to deny 
        adequate and effective protection of intellectual 
        property rights, notwithstanding the fact that the 
        foreign country may be in compliance with the specific 
        obligations of the Agreement on Trade-Related Aspects 
        of Intellectual Property Rights referred to in section 
        101(d)(15) of the Uruguay Round Agreements Act.
  (e) Publication.--The Trade Representative shall publish in 
the Federal Register a list of foreign countries identified 
under subsection (a) and shall make such revisions to the list 
as may be required by reason of action under subsection (c).
    (f) Special Rule for Actions Affecting United States 
Cultural Industries.--
          (1) In general.--By no later than the date that is 30 
        days after the date on which the annual report is 
        submitted to Congressional committees under section 
        181(b), the Trade Representative shall identify any 
        act, policy, or practice of Canada which--
                  (A) affects cultural industries,
                  (B) is adopted or expanded after December 17, 
                1992, and
                  (C) is actionable under article 2106 of the 
                North American Free Trade Agreement.
          (2) Special rules for identifications.--For purposes 
        of section 302(b)(2)(A), an act, policy, or practice 
        identified under this subsection shall be treated as an 
        act, policy, or practice that is the basis for 
        identification of a country under subsection (a)(2), 
        unless the United States has already taken action 
        pursuant to article 2106 of the North American Free 
        Trade Agreement in response to such act, policy, or 
        practice. In deciding whether to identify an act, 
        policy, or practice under paragraph (1), the Trade 
        Representative shall--
                  (A) consult with and take in to account the 
                views of representatives of the relevant 
                domestic industries, appropriate committees 
                established pursuant to section 135, and 
                appropriate officers of the Federal Government, 
                and
                  (B) take into account the information from 
                such sources as may be available to the Trade 
                Representative and such information as may be 
                submitted to the Trade Representative by 
                interested persons, including information 
                contained in reports submitted under section 
                181(b).
          (3) Cultural industries.--For purposes of this 
        subsection, the term `cultural industries' means 
        persons engaged in any of the following activities:
                  (A) The publication, distribution, or sale of 
                books, magazines, periodicals, or newpapers in 
                print or machine readable form but not 
                including the sole activity of printing or 
                typesetting any of the foregoing.
                  (B) The production, distribution, sale, or 
                exhibition of film or video recordings.
                  (C) The production, distribution, sale, or 
                exhibition of audio or video music recordings.
                  (D) The publication, distribution, or sale of 
                music in print or machine readable form.
                  (E) Radio communications in which the 
                transmissions are intended for direct reception 
                by the general public, and all radio, 
                television, and cable broadcasting undertakings 
                and all satellite programming and broadcasting 
                network services.
  (g) Annual Report.--The Trade Representative shall, by not 
later than the date by which countries are identified under 
subsection (a), transmit to the Committee on Ways and Means of 
the House of Representatives and the Committee on Finance of 
the Senate, a report on actions taken under this section during 
the 12 months preceding such report, and the reasons for such 
actions, including a description of progress made in achieving 
improved intellectual property protection and market access for 
persons relying on intellectual property rights.

                      3. Telecommunications Trade


                  Telecommunications Trade Act of 1988


(Title I, Subtitle C, Part 4 (Sections 1371-1382) of the Omnibus Trade 
                    and Competitiveness Act of 1988)


   [19 U.S.C. 3101 et seq.; P.L. 100-418, as amended by P.L. 103-465]

SEC. 1371. SHORT TITLE.

    This part may be cited as the ``Telecommunications Trade 
Act of 1988''.

SEC. 1372. FINDINGS AND PURPOSES.

    (a) Findings.--The Congress finds that--
          (1) rapid growth in the world market for 
        telecommunications products and services is likely to 
        continue for several decades;
          (2) the United States can improve prospects for--
                  (A) the growth of--
                          (i) United States exports of 
                        telecommunications products and 
                        services, and
                          (ii) export-related employment and 
                        consumer services in the United States, 
                        and
                  (B) the continuance of the technological 
                leadership of the United States,
        by undertaking a program to achieve an open world 
        market for trade in telecommunications products, 
        services, and investment;
          (3) most foreign markets for telecommunications 
        products, services, and investment are characterized by 
        extensive government intervention (including 
        restrictive import practices and discriminatory 
        procurement practices) which adversely affect United 
        States exports of telecommunications products and 
        services and United States investment in 
        telecommunications;
          (4) the open nature of the United States 
        telecommunications market, accruing from the 
        liberalization and restructuring of such market, has 
        contributed, and will continue to contribute, to an 
        increase in imports of telecommunications products and 
        a growing imbalance in competitive opportunities for 
        trade in telecommunications;
          (5) unless this imbalance is corrected through the 
        achievement of mutually advantageous market 
        opportunities for trade in telecommunications products 
        and services between the United States and foreign 
        countries, the United States should avoid granting 
        continued open access to the telecommunications 
        products and services of such foreign countries in the 
        United States market; and
          (6) the unique business conditions in the worldwide 
        market for telecommunications products and services 
        caused by the combination of deregulation and 
        divestiture in the United States, which represents a 
        unilateral liberalization of United States trade with 
        the rest of the world, and continuing government 
        intervention in the domestic industries of many other 
        countries create a need to make an exception in the 
        case of telecommunications products and services that 
        should not necessarily be a precedent for legislating 
        specific sectoral priorities in combating the closed 
        markets or unfair foreign trade practices of other 
        countries.
    (b) Purposes.--The purposes of this part are--
          (1) to foster the economic and technological growth 
        of, and employment in, the United States 
        telecommunications industry;
          (2) to secure a high quality telecommunications 
        network for the benefit of the people of the United 
        States;
          (3) to develop an international consensus in favor of 
        open trade and competition in telecommunications 
        products and services;
          (4) to ensure that countries which have made 
        commitments to open telecommunications trade fully 
        abide by those commitments; and
          (5) to achieve a more open world trading system for 
        telecommunications products and services through 
        negotiation and provision of mutually advantageous 
        market opportunities for United States 
        telecommunications exporters and their subsidiaries in 
        those markets in which barriers exist to free 
        international trade.

SEC. 1373. DEFINITIONS.

    For purposes of this part--
          (1) The term ``Trade Representative'' means the 
        United States Trade Representative.
          (2) The term ``telecommunications product'' means--
                  (A) any paging devices provided for under 
                item 685.65 of such Schedules, and
                  (B) any article classified under any of the 
                following item numbers of such Schedules:

            684.57                 685.16                   685.34
            684.58                 685.24                   685.39
            684.59                 685.25                   685.48
            684.65                 685.28                   688.17
            684.66                 685.30                   688.41
            684.67                 685.31                   707.90.
            684.80                 685.33

SEC. 1374. INVESTIGATION OF FOREIGN TELECOMMUNICATIONS TRADE BARRIERS.

  (a) In General.--The Trade Representative shall conduct an 
investigation to identify priority foreign countries. Such 
investigation shall be concluded by no later than the date that 
is 5 months after the date of enactment of this Act.
  (b) Factors To Be Taken Into Account.--In identifying 
priority foreign countries under subsection (a), the Trade 
Representative shall take into account, among other relevant 
factors--
          (1) the nature and significance of the acts, 
        policies, and practices that deny mutually advantageous 
        market opportunities to telecommunications products and 
        services of United States firms;
          (2) the economic benefits (actual and potential) 
        accruing to foreign firms from open access to the 
        United States market;
          (3) the potential size of the market of a foreign 
        country for telecommunications products and services of 
        United States firms;
          (4) the potential to increase United States exports 
        of telecommunications products and services, either 
        directly or through the establishment of a beneficial 
        precedent; and
          (5) measurable progress being made to eliminate the 
        objectionable acts, policies, or practices.
    (c) Revocations and Additional Identifications.--
          (1) The Trade Representative may at any time, after 
        taking into account the factors described in subsection 
        (b)--
                  (A) revoke the identification of any priority 
                foreign country that was made under this 
                section, or
                  (B) identify any foreign country as a 
                priority foreign country under this section,
        if information available to the Trade Representative 
        indicates that such action is appropriate.
          (2) The Trade Representative shall include in the 
        semiannual report submitted to the Congress under 
        section 309(3) of the Trade Act of 1974 a detailed 
        explanation of the reasons for the revocation under 
        paragraph (1) of this subsection of any identification 
        of any foreign country as a priority foreign country.
    (d) Report to Congress.--By no later than the date that is 
30 days after the date on which the investigation conducted 
under subsection (a) is completed, the United States Trade 
Representative shall submit a report on the investigation to 
the President and to appropriate committees of the Congress.

SEC. 1375. NEGOTIATIONS IN RESPONSE TO INVESTIGATION.

    (a) In General.--Upon--
          (1) the date that is 30 days after the date on which 
        any foreign country is identified in the investigation 
        conducted under section 1374(a) as a priority foreign 
        country, and
          (2) the date on which any foreign country is 
        identified under section 1374(c)(1)(B) as a priority 
        foreign country,
the President shall enter into negotiations with such priority 
foreign country for the purpose of entering into a bilateral or 
multilateral trade agreement under part 1 of subtitle A which 
meets the specific negotiating objectives established by the 
President under subsection (b) for such priority foreign 
country.
    (b) Establishment of Specific Negotiating Objectives for 
Each Foreign Priority Country.--
          (1) The President shall establish such relevant 
        specific negotiating objectives on a country-by-country 
        basis as are necessary to meet the general negotiating 
        objectives of the United States under this section.
          (2)(A) The President may refine or modify specific 
        negotiating objectives for particular negotiations in 
        order to respond to circumstances arising during the 
        negotiating period, including--
                  (i) changed practices by the priority foreign 
                country,
                  (ii) tangible substantive developments in 
                multilateral negotiations,
                  (iii) changes in competitive positions, 
                technological developments, or
                  (iv) other relevant factors.
          (B) By no later than the date that is 30 days after 
        the date on which the President makes any modifications 
        or refinements to specific negotiating objectives under 
        subparagraph (A), the President shall submit to 
        appropriate committees of the Congress a statement 
        describing such modifications or refinements and the 
        reasons for such modifications or refinements.
  (c) General Negotiating Objectives.--The general negotiating 
objectives of the United States under this section are--
          (1) to obtain multilateral or bilateral agreements 
        (or the modification of existing agreements) that 
        provide mutually advantageous market opportunities for 
        trade in telecommunications products and services 
        between the United States and foreign countries;
          (2) to correct the imbalances in market opportunities 
        accruing from reductions in barriers to the access of 
        telecommunications products and services of foreign 
        firms to the United States market; and
          (3) to facilitate the increase in United States 
        exports of telecommunications products and services to 
        a level of exports that reflects the competitiveness of 
        the United States telecommunications industry.
  (d) Specific Negotiating Objectives.--The specific 
negotiating objectives of the United States under this section 
regarding telecommunications products and services are to 
obtain--
          (1) national treatment for telecommunications 
        products and services that are provided by United 
        States firms;
          (2) most-favored-nation treatment for such products 
        and services;
          (3) nondiscriminatory procurement policies with 
        respect to such products and services and the inclusion 
        under the Agreement on Government Procurement of the 
        procurement (by sale or lease by government-owned or 
        controlled entities) of all telecommunications products 
        and services;
          (4) the reduction or elimination of customs duties on 
        telecommunications products;
          (5) the elimination of subsidies, violations of 
        intellectual property rights, and other unfair trade 
        practices that distort international trade in 
        telecommunications products and services;
          (6) the elimination of investment barriers that 
        restrict the establishment of foreign-owned business 
        entities which market such products and services;
          (7) assurances that any requirement for the 
        registration of telecommunications products, which are 
        to be located on customer premises, for the purposes 
        of--
                  (A) attachment to a telecommunications 
                network in a foreign country, and
                  (B) the marketing of the products in a 
                foreign country,
        be limited to the certification by the manufacturer 
        that the products meet the standards established by the 
        foreign country for preventing harm to the network or 
        network personnel;
          (8) transparency of, and open participation in, the 
        standards-setting processes used in foreign countries 
        with respect to telecommunications products;
          (9) the ability to have telecommunications products, 
        which are to be located on customer premises, approved 
        and registered by type, and, if appropriate, the 
        establishment of procedures between the United States 
        and foreign countries for the mutual recognition of 
        type approvals;
          (10) access to the basic telecommunications network 
        in foreign countries on reasonable and 
        nondiscriminatory terms and conditions (including 
        nondiscriminatory prices) for the provision of value-
        added services by United States suppliers;
          (11) the nondiscriminatory procurement of 
        telecommunications products and services by foreign 
        entities that provide local exchange telecommunications 
        services which are owned, controlled, or, if 
        appropriate, regulated by foreign governments; and
          (12) monitoring and effective dispute settlement 
        mechanisms to facilitate compliance with matters 
        referred to in the preceding paragraphs of this 
        subsection.

SEC. 1376. ACTIONS TO BE TAKEN IF NO AGREEMENT OBTAINED.

  (a) In General.--
          (1) If the President is unable, before the close of 
        the negotiating period, to enter into an agreement 
        under subtitle A with any priority foreign country 
        identified under section 1374 which achieves the 
        general negotiating objectives described in section 
        1375(b) as defined by the specific objectives 
        established by the President for that country, the 
        President shall take whatever actions authorized under 
        subsection (b) that are appropriate and most likely to 
        achieve such general negotiating objectives.
          (2) In taking actions under paragraph (1), the 
        President shall first take those actions which most 
        directly affect trade in telecommunications products 
        and services with the priority foreign country referred 
        to in paragraph (1), unless the President determines 
        that actions against other economic sectors would be 
        more effective in achieving the general negotiating 
        objectives referred to in paragraph (1).
  (b) Actions Authorized.--
          (1) The President is authorized to take any of the 
        following actions under subsection (a) with respect to 
        any priority foreign country:
                  (A) termination, withdrawal, or suspension of 
                any portion of any trade agreement entered into 
                with such country under--
                          (i) the Trade Act of 1974,
                          (ii) section 201 of the Trade 
                        Expansion Act of 1962, or
                          (iii) section 350 of the Tariff Act 
                        of 1930,
                with respect to any duty or import restriction 
                imposed by the United States on any 
                telecommunications product;
                  (B) actions described in section 301 of the 
                Trade Act of 1974;
                  (C) prohibition of purchases by the Federal 
                Government of telecommunications products of 
                such country;
                  (D) increases in domestic preferences under 
                title III of the Act of March 3, 1933 (41 
                U.S.C. 10a, et seq.) for purchases by the 
                Federal Government of telecommunications 
                products of such country;
                  (E) suspension of any waiver of domestic 
                preferences under title III of the Act of March 
                3, 1933 (41 U.S.C. 10a, et seq.) which may have 
                been extended to such country pursuant to the 
                Trade Agreements Act of 1979 with respect to 
                telecommunications products or any other 
                products;
                  (F) issuance of orders to appropriate 
                officers and employees of the Federal 
                Government to deny Federal funds or Federal 
                credits for purchases of the telecommunications 
                products of such country; and
                  (G) suspension, in whole or in part, of 
                benefits accorded articles of such country 
                under title V of the Trade Act of 1974 (19 
                U.S.C. 2461, et seq.).
          (2) Notwithstanding section 125 of the Trade Act of 
        1974 and any other provision of law, if any portion of 
        a trade agreement described in paragraph (1)(A) is 
        terminated, withdrawn, or suspended under paragraph (1) 
        with respect to any duty imposed by the United States 
        on the products of a foreign country, the rate of such 
        duty that shall apply to such products entered, or 
        withdrawn from warehouse for consumption, after the 
        date on which such termination, withdrawal, or 
        suspension takes effect shall be a rate determined by 
        the President.
    (c) Negotiating Period.--
          (1) For purposes of this section, the term 
        ``negotiating period'' means--
                  (A) with respect to a priority foreign 
                country identified in the investigation 
                conducted under section 1374(a), the 18-month 
                period beginning on the date of the enactment 
                of this Act, and
                  (B) with respect to any foreign country 
                identified as a priority foreign country after 
                the conclusion of such investigation, the 1-
                year period beginning on the date on which such 
                identification is made.
          (2)(A) The negotiating period with respect to a 
        priority foreign country may be extended for not more 
        than two 1-year periods.
          (B) By no later than the date that is 15 days after 
        the date on which the President extends the negotiating 
        period with respect to any priority foreign country, 
        the President shall submit to appropriate committees of 
        the Congress a report on the status of negotiations 
        with such country that includes--
                  (i) a finding by the President that 
                substantial progress is being made in 
                negotiations with such country, and
                  (ii) a statement detailing the reasons why an 
                extension of such negotiating period is 
                necessary.
    (d) Modification and Termination Authority.--The President 
may modify or terminate any action taken under subsection (a) 
if, after taking into consideration the factors described in 
section 1374(b), the President determines that changed 
circumstances warrant such modification or termination.
    (e) Report.--The President shall promptly inform the 
appropriate committees of the Congress of any action taken 
under subsection (a) or of the modification or termination of 
any such action under subsection (d).

SEC. 1377. REVIEW OF TRADE AGREEMENT IMPLEMENTATION BY TRADE 
                    REPRESENTATIVE.

    (a) In General.--
          (1) In conducting the annual analysis under section 
        181(a) of the Trade Act of 1974 (19 U.S.C. 2241), the 
        Trade Representative shall review the operation and 
        effectiveness of--
                  (A) each trade agreement negotiated by reason 
                of this part that is in force with respect to 
                the United States; and
                  (B) every other trade agreement regarding 
                telecommunications products or services that is 
                in force with respect to the United States.
          (2) In each review conducted under paragraph (1), the 
        Trade Representative shall determine whether any act, 
        policy, or practice of the foreign country that has 
        entered into the agreement described in paragraph (1)--
                  (A) is not in compliance with the terms of 
                such agreement, or
                  (B) otherwise denies, within the context of 
                the terms of such agreement, to 
                telecommunications products and services of 
                United States firms mutually advantageous 
                market opportunities in that foreign country.
    (b) Review Factors.--
          (1) In conducting reviews under subsection (a), the 
        Trade Representative shall consider any evidence of 
        actual patterns of trade (including United States 
        exports to a foreign country of telecommunications 
        products and services, including sales and services 
        related to those products) that do not reflect patterns 
        of trade which would reasonably be anticipated to flow 
        from the concessions or commitments of such country 
        based on the international competitive position and 
        export potential of such products and services.
          (2) The Trade Representative shall consult with the 
        United States International Trade Commission with 
        regard to the actual patterns of trade described in 
        paragraph (1).
    (c) Action in Response to Affirmative Determination.--
          (1) Any affirmative determination made by the Trade 
        Representative under subsection (a)(2) with respect to 
        any act, policy, or practice of a foreign country 
        shall, for purposes of chapter 1 of title III of the 
        Trade Act of 1974, be treated as an affirmative 
        determination under section 304(a)(1)(A) of such Act 
        that such act, policy, or practice violates a trade 
        agreement.
          (2) In taking actions under section 301 by reason of 
        paragraph (1), the Trade Representative shall first 
        take those actions which most directly affect trade in 
        telecommunications products and services with the 
        priority foreign country referred to in paragraph (1), 
        unless the Trade Representative determines that actions 
        against other economic sectors would be more effective 
        in achieving compliance by the foreign country with the 
        trade agreement that is the subject of the affirmative 
        determination made under subsection (a)(2).

SEC. 1378. COMPENSATION AUTHORITY.

  If--
          (1) the President has taken action under section 
        1376(a) with respect to any foreign country, and
          (2) such action is found to be inconsistent with the 
        international obligations of the United States, 
        including the WTO Agreement and the multilateral trade 
        agreements (as such terms are defined in paragraphs (8) 
        and (4), respectively, of section 2 of the Uruguay 
        Round Agreements Act),
the President may enter into trade agreements with such foreign 
country for the purpose of granting new concessions as 
compensation for such action in order to maintain the general 
level of reciprocal and mutually advantageous concessions.

SEC. 1379. CONSULTATIONS.

    (a) Advice From Departments and Agencies.--Prior to taking 
any action under this part, the President shall seek 
information and advice from the interagency trade organization 
established under section 242(a) of the Trade Expansion Act of 
1962 (19 U.S.C. 1872).
    (b) Advice From the Private Sector.--Before--
          (1) the Trade Representative concludes the 
        investigation conducted under section 1374(a) or takes 
        action under section 1374(c),
          (2) the President establishes specific negotiating 
        objectives under section 1375(b) with respect to any 
        foreign country, or
          (3) the President takes action under section 1376,
the Trade Representative shall provide an opportunity for the 
presentation of views by any interested party with respect to 
such investigation, objectives, or action, including 
appropriate committees established pursuant to section 135 of 
the Trade Act of 1974 (19 U.S.C. 2155).
    (c) Consultations With Congress and Official Advisors.--For 
purposes of conducting negotiations under section 1375(a), the 
Trade Representative shall keep appropriate committees of the 
Congress, as well as appropriate committees established 
pursuant to section 135 of the Trade Act of 1974, currently 
informed with respect to--
          (1) the negotiating priorities and objectives for 
        each priority foreign country;
          (2) the assessment of negotiating prospects, both 
        bilateral and multilateral; and
          (3) any United States concessions which might be 
        included in negotiations to achieve the objectives 
        described in subsections (c) and (d) of section 1375.
    (d) Modification of Specific Negotiating Objectives.--
Before the President takes any action under section 
1375(b)(2)(A) to refine or modify specific negotiating 
objectives, the President shall consult with the Congress and 
with members of the industry, and representatives of labor, 
affected by the proposed refinement or modification.

SEC. 1380. SUBMISSION OF DATA; ACTION TO ENSURE COMPLIANCE.

    (a) Submission of Data.--The Federal Communications 
Commission (hereafter in this section referred to as the 
``Commission'') shall periodically submit to appropriate 
committees of the House of Representatives and of the Senate 
any data collected and otherwise made public under Report No. 
DC-1105, ``Information Reporting Requirements Established for 
Common Carriers'', adopted February 25, 1988, relating to FCC 
Docket No. 86-494, adopted December 23, 1987.
    (b) Action To Ensure Compliance.--
          (1)(A) Any product of a foreign country that is 
        subject to registration or approval by the Commission 
        may be entered only if--
                  (i) such product conforms with all applicable 
                rules and regulations of the Commission, and
                  (ii) the information which is required on 
                Federal Communications Commission Form 740 on 
                the date of enactment of this Act is provided 
                to the appropriate customs officer at the time 
                of such entry in such form and manner as the 
                Secretary of the Treasury may prescribe.
          (B) For purposes of this paragraph, the term 
        ``entered'' means entered, or withdrawn from warehouse 
        for consumption, in the customs territory of the United 
        States.
          (2) The Commission, the Secretary of Commerce, and 
        the Trade Representative shall provide such assistance 
        in the enforcement of paragraph (1) as the Secretary of 
        the Treasury may request.
          (3) The Secretary of the Treasury shall compile the 
        information collected under paragraph (1)(A)(ii) into a 
        summary and shall annually submit such summary to the 
        Congress until the authority to negotiate trade 
        agreements under part 1 of subtitle A expires. Such 
        information shall also be made available to the public.

SEC. 1381. STUDY ON TELECOMMUNICATIONS COMPETITIVENESS IN THE UNITED 
                    STATES.

    (a) In General.--The Secretary of Commerce, in consultation 
with the Federal Communications Commission and the United 
States Trade Representative, shall conduct a study of the 
competitiveness of the United States telecommunications 
industry and the effects of foreign telecommunications policies 
and practices on such industry in order to assist the Congress 
and the President in determining what actions might be 
necessary to preserve the competitiveness of the United States 
telecommunications industry.
    (b) Public Comment.--The Secretary of Commerce may, as 
appropriate, provide notice and reasonable opportunity for 
public comment as part of the study conducted under subsection 
(a).
    (c) Report.--The Secretary of Commerce shall, by no later 
than the date that is 1 year after the date of enactment of 
this Act, submit to the Congress and the President a report on 
the findings and recommendations reached by the Secretary of 
Commerce as a result of the study conducted under subsection 
(a). Such report shall be referred to the appropriate 
committees of the House of Representatives and of the Senate.

SEC. 1382. INTERNATIONAL OBLIGATIONS.

    Nothing in this part may be construed to require actions 
inconsistent with the international obligations of the United 
States, including the WTO Agreement and the multilateral trade 
agreements (as such terms are defined in paragraphs (9) and 
(4), respectively, of section 2 of the Uruguay Round Agreements 
Act).

        F. NORMAL TRADE RELATIONS (NONDISCRIMINATORY) TREATMENT


                            1. NTR Principle


 Section 5003 of P.L. 105-206: Clarification of Designation of Normal 
                             Trade Relation


                         [19 U.S.C. 2434 note]

SEC. 5003. CLARIFICATION OF DESIGNATION OF NORMAL TRADE RELATIONS.

      (a) Findings and Policy.--
          (1) Findings.--The Congress makes the following 
        findings:
                  (A) Since the 18th century, the principle of 
                nondiscrimination among countries with which 
                the United States has trade relations, commonly 
                referred to as ``most-favored-nation'' 
                treatment, has been a cornerstone of United 
                States trade policy.
                  (B) Although the principle remains firmly in 
                place as a fundamental concept in United States 
                trade relations, the term ``most-favored-
                nation'' is a misnomer which has led to public 
                misunderstanding.
                  (C) It is neither the purpose nor the effect 
                of the most-favored-nation principle to treat 
                any country as ``most favored''. To the 
                contrary, the principle reflects the intention 
                to confer on a country the same trade benefits 
                that are conferred on any other country, that 
                is, the intention not to discriminate among 
                trading partners.
                  (D) The term ``normal trade relations'' is a 
                more accurate description of the principle of 
                nondiscrimination as it applies to the tariffs 
                applicable generally to imports from United 
                States trading partners, that is, the general 
                rates of duty set forth in column 1 of the 
                Harmonized Tariff Schedule of the United 
                States.
          (2) Policy.--It is the sense of the Congress that--
                  (A) the language used in United States laws, 
                treaties, agreements, executive orders, 
                directives, and regulations should more clearly 
                and accurately reflect the underlying 
                principles of United States trade policy; and
                  (B) accordingly, the term ``normal trade 
                relations'' should, where appropriate, be 
                substituted for the term ``most-favored-
                nation''.
      (b)Change in Terminology.--
      [Amends several trade statutes to reflect change in 
terminology, several reprinted elsewhere.]
      (c) Savings Provisions.--Nothing in this section shall 
affect the meaning of any provision of law, Executive Order, 
Presidential proclamation, rule, regulation, delegation of 
authority, other document, or treaty or other international 
agreement of the United States relating to the principle of 
``most-favored-nation'' (or ``most favored nation'') treatment. 
Any Executive Order, Presidential proclamation, rule, 
regulation, delegation of authority, other document, or treaty 
or other international agreement of the United States that has 
been issued, made, granted, or allowed to become effective and 
that is in effect on the effective date of this Act, or was to 
become effective on or after the effective date of this Act, 
shall continue in effect according to its terms until modified, 
terminated, superseded, set aside, or revoked in accordance 
with law.

             Section 251 of the Trade Expansion Act of 1962


              [19 U.S.C. 1881; P.L. 87-794; P.L. 105-206]

SEC. 251. NORMAL TRADE RELATIONS.

    Except as otherwise provided in this title, in section 
350(b) of the Tariff Act of 1930, or in section 401(a) of the 
Tariff Classification Act of 1962, any duty or other import 
restriction or duty-free treatment proclaimed in carrying out 
any trade agreement under this title or section 350 of the 
Tariff Act of 1930 shall apply to products of all foreign 
countries, whether imported directly or indirectly.

                Section 126(a) of the Trade Act of 1974


                     [19 U.S.C. 2136; P.L. 93-618]

SEC. 126. RECIPROCAL NONDISCRIMINATORY TREATMENT.

    (a) Except as otherwise provided in this Act or in any 
other provision of law, any duty or other import restriction or 
duty-free treatment proclaimed in carrying out any trade 
agreement under this title shall apply to products of all 
foreign countries, whether imported directly or indirectly.
    [Section 1105(a) of the Omnibus Trade and Competitiveness 
Act of 1988 applies section 126(a) to trade agreements entered 
into under section 1102 of that Act.]

Section 1103(a)(3) of the Omnibus Trade and Competitiveness Act of 1988


                     [19 U.S.C. 2903; P.L. 100-418]

SEC. 1103. IMPLEMENTATION OF TRADE AGREEMENTS.

           *       *       *       *       *       *       *


    (a)(3) To ensure that a foreign country which receives 
benefits under a trade agreement entered into under section 
1102(b) or (c) is subject to the obligations imposed by such 
agreement, the President shall recommend to Congress in the 
implementing bill and statement of administrative action 
submitted with respect to such agreement that the benefits and 
obligations of such agreement apply solely to the parties to 
such agreement, if such application is consistent with the 
terms of such agreement. The President may also recommend with 
respect to any such agreement that the benefits and obligations 
of such agreement not apply uniformly to all parties to such 
agreement, if such application is consistent with the terms of 
such agreement.

          2. Trade Relations with Nonmarket Economy Countries


        General Note 3(b) of the Harmonized Tariff Schedule \1\


Rate of Duty Column 2.

    Notwithstanding any of the foregoing provisions of this 
note, the rates of duty shown in column 2 shall apply to 
products, whether imported directly or indirectly, of the 
following countries and areas pursuant to section 401 of the 
Tariff Classification Act of 1962, to section 231 or 257(e)(2) 
of the Trade Expansion Act of 1962, to section 404(a) of the 
Trade Act of 1974 or to any other applicable section of law, or 
to action taken by the President thereunder:
---------------------------------------------------------------------------
    \1\ List as printed in the 1997 edition.

Afghanistan
Cuba
Laos
North Korea
Vietnam

             Title IV of the Trade Act of 1974, as amended


    [19 U.S.C. 2431 et seq., P.L. 93-618, as amended by P.L. 96-39, 
  Reorganization Plan No. 3 of 1979, P.L. 100-418, P.L. 101-382, P.L. 
                       104-295 and P.L. 105-206]

SEC. 401. EXCEPTION OF THE PRODUCTS OF CERTAIN COUNTRIES OR AREAS.

    Except as otherwise provided in this title, the President 
shall continue to deny nondiscriminatory treatment to the 
products of any country, the products of which were not 
eligible for the rates set forth in rate column numbered 1 of 
the Tariff Schedules of the United States on the date of the 
enactment of this Act.

SEC. 402. FREEDOM OF EMIGRATION IN EAST-WEST TRADE.

    (a) To assure the continued dedication of the United States 
to fundamental human rights, and notwithstanding any other 
provision of law, on or after the date of the enactment of this 
Act products from any nonmarket economy country shall not be 
eligible to receive nondiscriminatory treatment (normal trade 
relations), such country shall not participate in any program 
of the Government of the United States which extends credits or 
credit guarantees or investment guarantees, directly or 
indirectly, and the President of the United States shall not 
conclude any commercial agreement with any such country, during 
the period beginning with the date on which the President 
determines that such country--
          (1) denies its citizens the right or opportunity to 
        emigrate;
          (2) imposes more than a nominal tax on emigration or 
        on the visas or other documents required for 
        emigration, for any purpose or cause whatsoever; or
          (3) imposes more than a nominal tax, levy, fine, fee, 
        or other charge on any citizen as a consequence of the 
        desire of such citizen to emigrate to the country of 
        his choice,
and ending on the date on which the President determines that 
such country is no longer in violation of paragraph (1), (2), 
or (3).
    (b) After the date of the enactment of this Act, (A) 
products of a nonmarket economy country may be eligible to 
receive nondiscriminatory treatment (normal trade relations), 
(B) such country may participate in any program of the 
Government of the United States which extends credits or credit 
guarantees or investment guarantees, and (C) the President may 
conclude a commercial agreement with such country, only after 
the President has submitted to the Congress a report indicating 
that such country is not in violation of paragraph (1), (2), or 
(3) of subsection (a). Such report with respect to such country 
shall include information as to the nature and implementation 
of emigration laws and policies and restrictions or 
discrimination applied to or against persons wishing to 
emigrate. The report required by this subsection shall be 
submitted initially as provided herein and, with current 
information, on or before each June 30 and December 31 
thereafter so long as such treatment is received, such credits 
or guarantees are extended, or such agreement is in effect.
    (c)(1) During the 18-month period beginning on the date of 
the enactment of this Act, the President is authorized to waive 
by Executive Order the application of subsections (a) and (b) 
with respect to any country, if he reports to the Congress 
that--
          (A) he has determined that such waiver will 
        substantially promote the objectives of this section; 
        and
          (B) he has received assurances that the emigration 
        practices of that country will henceforth lead 
        substantially to the achievement of the objectives of 
        this section.
    (2) During any period subsequent to the 18-month period 
referred to in paragraph (1), the President is authorized to 
waive by Executive Order the application of subsections (a) and 
(b) with respect to any country, if the waiver authority 
granted by this subsection continues to apply to such country 
pursuant to subsection (d), and if he reports to the Congress 
that--
          (A) he has determined that such waiver will 
        substantially promote the objectives of this section; 
        and
          (B) he has received assurances that the emigration 
        practices of that country will henceforth lead 
        substantially to the achievement of the objectives of 
        this section.
    (3) A waiver with respect to any country shall terminate on 
the day after the waiver authority granted by this subsection 
ceases to be effective with respect to such country pursuant to 
subsection (d). The President may, at any time, terminate by 
Executive Order any waiver granted under this subsection.
    (d)(1) If the President determines that the further 
extension of the waiver authority granted under subsection (c) 
will substantially promote the objectives of this section, he 
may recommend further extensions of such authority for 
successive 12-month periods. Any such recommendations shall--
          (A) be made not later than 30 days before the 
        expiration of such authority;
          (B) be made in a document transmitted to the House of 
        Representatives and the Senate setting forth his 
        reasons for recommending the extension of such 
        authority; and
          (C) include, for each country with respect to which a 
        waiver granted under subsection (c) is in effect, a 
        determination that continuation of the waiver 
        applicable to that country will substantially promote 
        the objectives of this section, and a statement setting 
        forth his reasons for such determination.
If the President recommends the further extension of such 
authority, such authority shall continue in effect until the 
end of the 12-month period following the end of the previous 
12-month extension with respect to any country (except for any 
country with respect to which such authority has not been 
extended under this subsection), unless a joint resolution 
described in section 153(a) is enacted into law pursuant to the 
provisions of paragraph (2).
    (2)(A) The requirements of this paragraph are met if the 
joint resolution is enacted under the procedures set forth in 
section 153, and--
          (i) the Congress adopts and transmits the joint 
        resolution to the President before the end of the 60-
        day period beginning on the date the waiver authority 
        would expire but for an extension under paragraph (1), 
        and
          (ii) if the President vetoes the joint resolution, 
        each House of Congress votes to override such veto on 
        or before the later of the last day of the 60-day 
        period referred to in clause (i) or the last day of the 
        15-day period (excluding any day described in section 
        154(b)) beginning on the date the Congress receives the 
        veto message from the President.
    (B) If a joint resolution is enacted into law under the 
provisions of this paragraph, the waiver authority applicable 
to any country with respect to which the joint resolution 
disapproves of the extension of such authority shall cease to 
be effective as of the day after the 60-day period beginning on 
the date of the enactment of the joint resolution.
    (C) A joint resolution to which this subsection and section 
153 apply may be introduced at any time on or after the date 
the President transmits to the Congress the document described 
in paragraph (1)(B).
    (e) This section shall not apply to any country the 
products of which are eligible for the rates set forth in rate 
column numbered 1 of the Tariff Schedules of the United States 
on the date of the enactment of this Act.

SEC. 403. UNITED STATES PERSONNEL MISSING IN ACTION IN SOUTHEAST ASIA.

    (a) Notwithstanding any other provision of law, if the 
President determines that a nonmarket economy country is not 
cooperating with the United States--
          (1) to achieve a complete accounting of all United 
        States military and civilian personnel who are missing 
        in action in Southeast Asia,
          (2) to repatriate such personnel who are alive, and
          (3) to return the remains of such personnel who are 
        dead to the United States,
then, during the period beginning with the date of such 
determination and ending on the date on which the President 
determines such country is cooperating with the United States, 
he may provide that--
          (A) the products of such country may not receive 
        nondiscriminatory treatment,
          (B) such country may not participate, directly or 
        indirectly, in any program under which the United 
        States extends credit, credit guarantees, or investment 
        guarantees, and
          (C) no commercial agreement entered into under this 
        title between such country and the United States will 
        take effect.
    (b) This section shall not apply to any country the 
products of which are eligible for the rates set forth in rate 
column numbered 1 of the Tariff Schedules of the United States 
on the date of enactment of this Act.

SEC. 404. EXTENSION OF NONDISCRIMINATORY TREATMENT.

    (a) Subject to the provisions of section 405(c), the 
President may by proclamation extend nondiscriminatory 
treatment to the products of a foreign country which has 
entered into a bilateral commercial agreement referred to in 
section 405.
    (b) The application of nondiscriminatory treatment shall be 
limited to the period of effectiveness of the obligations of 
the United States to such country under such bilateral 
commercial agreement. In addition, in the case of any foreign 
country receiving nondiscriminatory treatment pursuant to this 
title which has entered into an agreement with the United 
States regarding the settlement of lend-lease reciprocal aid 
and claims, the application of such nondiscriminatory treatment 
shall be limited to period during which such country is not in 
arrears on its obligations under such agreement.
    (c) The President may at any time suspend or withdraw any 
extension of nondiscriminatory treatment to any country 
pursuant to subsection (a) and thereby cause all products of 
such country to be dutiable at the rates set forth in rate 
column numbered 2 of the Harmonized Tariff Schedule of the 
United States.

SEC. 405. AUTHORITY TO ENTER INTO COMMERCIAL AGREEMENTS.

    (a) Subject to the provisions of subsections (b) and (c) of 
this section, the President may authorize the entry into force 
of bilateral commercial agreements providing nondiscriminatory 
treatment to the products of countries heretofore denied such 
treatment whenever he determines that such agreements with such 
countries will promote the purposes of this Act and are in the 
national interest.
    (b) Any such bilateral commercial agreement shall--
          (1) be limited to an initial period specified in the 
        agreement which shall be no more than 3 years from the 
        date the agreement enters into force; except that it 
        may be renewable for additional periods, each not to 
        exceed 3 years; if--
                  (A) a satisfactory balance of concessions in 
                trade and services has been maintained during 
                the life of such agreement, and
                  (B) the President determines that actual or 
                foreseeable reductions in United States tariffs 
                and nontariff barriers to trade resulting from 
                multilateral negotiations are satisfactorily 
                reciprocated by the other party to the 
                bilateral agreement;
          (2) provide that it is subject to suspension or 
        termination at any time for national security reasons, 
        or that the other provisions of such agreement shall 
        not limit the rights of any party to take any action 
        for the protection of its security interests;
          (3) include safeguard arrangements (A) providing for 
        prompt consultations whenever either actual or 
        prospective imports cause or threaten to cause, or 
        significantly contribute to, market disruption and (B) 
        authorizing the imposition of such import restrictions 
        as may be appropriate to prevent such market 
        disruption;
          (4) if the other party to the bilateral agreement is 
        not a party to the Paris Convention for the Protection 
        of Industrial Property, provide rights for United 
        States nationals with respect to patents and trademarks 
        in such country not less than the rights specified in 
        such convention;
          (5) if the other party to the bilateral agreement is 
        not a party to the Universal Copyright Convention, 
        provide rights for United States nationals with respect 
        to copyrights in such country not less than the rights 
        specified in such convention;
          (6) in the case of an agreement entered into or 
        renewed after the date of the enactment of the Act, 
        provide arrangements for the protection of industrial 
        rights and processes;
          (7) provide arrangements for the settlement of 
        commercial differences and disputes;
          (8) in the case of an agreement entered into or 
        renewed after the date of the enactment of this Act, 
        provide arrangements for the promotion of trade, which 
        may include arrangements for the establishment or 
        expansion of trade and tourist promotion offices, for 
        facilitation of activities of governmental commercial 
        officers, participation in trade fairs and exhibits, 
        and the sending of trade missions, and for facilitation 
        of entry, establishment, and travel of commercial 
        representatives;
          (9) provide for consultations for the purpose of 
        reviewing the operation of the agreement and relevant 
        aspects of relations between the United States and the 
        other party; and
          (10) provide such other arrangements of a commercial 
        nature as will promote the purpose of this Act.
    (c) An agreement referred to in subsection (a), and a 
proclamation referred to in section 404(a) implementing such 
agreement, shall take effect only if a joint resolution 
described in section 151(b)(3) that approves of the agreement 
referred to in subsection (a) is enacted into law.

[SEC. 406. MARKET DISRUPTION.

    See separate section under Chapter 9.]

SEC. 407. PROCEDURE FOR CONGRESSIONAL APPROVAL OR DISAPPROVAL OF 
                    EXTENSION OF NONDISCRIMINATORY TREATMENT AND 
                    PRESIDENTIAL REPORTS.

    (a) Whenever the President issues a proclamation under 
section 404 extending nondiscriminatory treatment to the 
products of any foreign country, he shall promptly transmit to 
the House of Representatives and to the Senate a document 
setting forth the proclamation and the agreement the 
proclamation proposes to implement, together with his reasons 
therefor.
    (b) The President shall transmit to the House of 
Representatives and the Senate a document containing the 
initial report submitted by him under section 402(b) or 409(b) 
with respect to a nonmarket economy country. On or before 
December 31 of each year, the President shall transmit to the 
House of Representatives and the Senate, a document containing 
the report required by section 402(b) or 409(b) as the case may 
be, to be submitted on or before such December 31.
    (c)(1) In the case of a document referred to in subsection 
(a), the proclamation set forth in the document may become 
effective and the agreement set forth in the document may enter 
into force and effect only if a joint resolution described in 
section 151(b)(3) that approves of the extension of 
nondiscriminatory treatment to the products of the country 
concerned is enacted into law.
    (2) In the case of a document referred to in subsection (b) 
which contains a report submitted by the President under 
section 402(b) or 409(b) with respect to a nonmarket economy 
country, if, before the close of the 90-day period beginning on 
the day on which such document is delivered to the House of 
Representatives and to the Senate, a joint resolution described 
in section 152(a)(1)(B) is enacted into law that disapproves of 
the report submitted by the President with respect to such 
country, then, beginning with the day after the end of the 60-
day period beginning with the date of the enactment of such 
resolution of disapproval, (A) nondiscriminatory treatment 
shall not be in force with respect to the products of such 
country, and the products of such country shall be dutiable at 
the rates set forth in rate column numbered 2 of the Harmonized 
Tariff Schedule of the United States, (B) such country may not 
participate in any program of the Government of the United 
States which extends credit or credit guarantees or investment 
guarantees, and (C) no commercial agreement may thereafter be 
concluded with such country under this title. If the President 
vetoes the joint resolution, the joint resolution shall be 
treated as enacted into law before the end of the 90-day period 
under this paragraph if both Houses of Congress vote to 
override such veto on or before the later of the last day of 
such 90-day period or the last day of the 15-day period 
(excluding any day described in section 154(b)) beginning on 
the date the Congress receives the veto message from the 
President.

SEC. 408. PAYMENT BY CZECHOSLOVAKIA OF AMOUNTS OWED UNITED STATES 
                    CITIZENS AND NATIONALS.

    (a) The arrangement initialed on July 5, 1974, with respect 
to the settlement of the claims of citizens and nationals of 
the United States against the Government of Czechoslovakia 
shall be renegotiated and shall be submitted to the Congress as 
part of any agreement entered into under this title with 
Czechoslovakia.
    (b) The United States shall not release any gold belonging 
to Czechoslovakia and controlled directly or indirectly by the 
United States pursuant to the provisions of the Paris 
Reparations Agreement of January 24, 1946, or otherwise, until 
such agreement has been approved by the Congress.

SEC. 409. FREEDOM TO EMIGRATE TO JOIN A VERY CLOSE RELATIVE IN THE 
                    UNITED STATES.

    (a) To assure the continued dedication of the United States 
to the fundamental human rights and welfare of its own 
citizens, and notwithstanding any other provision of law, on or 
after the date of the enactment of this Act, no nonmarket 
economy country shall participate in any program of the 
Government of the United States which extends credits or credit 
guarantees or investment guarantees, directly or indirectly, 
and the President of the United States shall not conclude any 
commercial agreement with any such country, during the period 
beginning with the date on which the President determines that 
such country--
          (1) denies its citizens the right or opportunity to 
        join permanently through emigration, a very close 
        relative in the United States, such as a spouse, 
        parent, child, brother, or sister;
          (2) imposes more than a nominal tax on the visas or 
        other documents required for emigration described in 
        paragraph (1); or
          (3) imposes more than a nominal tax, levy, fine, fee, 
        or other charge on any citizen as a consequence of the 
        desire of such citizen to emigrate as described in 
        paragraph (1),
and ending on the date on which the President determines that 
such country is no longer in violation of paragraph (1), (2), 
or (3).
    (b) After the date of the enactment of this Act, (A) a 
nonmarket economy country may participate in any program of the 
Government of the United States which extends credits or credit 
guarantees or investment guarantees, and (B) the President may 
conclude a commercial agreement with such country, only after 
the President has submitted to the Congress a report indicating 
that such country is not in violation of paragraph (1), (2), or 
(3) of subsection (a). Such report with respect to such country 
shall include information as to the nature and implementation 
of its laws and policies and restrictions or discrimination 
applied to or against persons wishing to emigrate to the United 
States to join close relatives. The report required by this 
subsection shall be submitted initially as provided herein and, 
with current information, on or before each June 30 and 
December 31 thereafter, so long as such credits or guarantees 
are extended or such agreement is in effect.
    (c) This section shall not apply to any country the 
products of which are eligible for the rates set forth in rate 
column numbered 1 of the Tariff Schedules of the United States 
on the date of enactment of this Act.
    (d) During any period that a waiver is in effect with 
respect to any nonmarket economy country under section 402(c), 
the provisions of subsections (a) and (b) shall not apply with 
respect to such country.

[SEC. 410. EAST-WEST TRADE STATISTICS MONITORING SYSTEM.

    Repealed by Public Law 104-295, section 17.]

[SEC. 411. EAST-WEST FOREIGN TRADE BOARDS.

    Abolished by section 6 and functions transferred to the 
President and interagency trade organization by section 5 (c) 
and (e) of Reorganization Plan No. 3 of 1979.]

                 Sections 1 and 2 of Public Law 102-182


      NTR Treatment for Hungary and the Czech and Slovak Republics


                         [19 U.S.C. 2434 note]

SECTION 1. CONGRESSIONAL FINDINGS AND PREPARATORY PRESIDENTIAL ACTION.

    (a) Congressional Findings.--The Congress finds that the 
Czech and Slovak Federal Republic and the Republic of Hungary 
both have--
          (1) dedicated themselves to respect for fundamental 
        human rights;
          (2) accorded to their citizens the right to emigrate 
        and to travel freely;
          (3) reversed over 40 years of communist dictatorship 
        and embraced the establishment of political pluralism, 
        free and fair elections, and multi-party political 
        systems;
          (4) introduced far-reaching economic reforms based on 
        market-oriented principles and have decentralized 
        economic decisionmaking; and
          (5) demonstrated a strong desire to build friendly 
        relationships with the United States.
    (b) Preparatory Presidential Action.--The Congress notes 
that the President in anticipation of the enactment of section 
2, has directed the United States Trade Representative to 
negotiate with the Czech and Slovak Federal Republic and the 
Republic of Hungary, respectively, in order to--
          (1) preserve the commitments of that country under 
        the bilateral commercial agreement in effect between 
        that country and the United States that are consistent 
        with the General Agreement on Tariffs and Trade; and
          (2) obtain other appropriate commitments.

SEC. 2. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE ACT OF 1974 
                    TO CZECHOSLOVAKIA AND HUNGARY.

    (a) Presidential Determinations and Extension of 
Nondiscriminatory Treatment.--Notwithstanding any provision of 
title IV of the Trade Act of 1974 (19 U.S.C. 2431 et seq.), the 
President may--
          (1) determine that such title should no longer apply 
        to the Czech and Slovak Federal Republic or to the 
        Republic of Hungary, or to both; and
          (2) after making a determination under paragraph (1) 
        with respect to a country, proclaim the extension of 
        nondiscriminatory treatment (most-favored-nation 
        treatment) to the products of that country.
    (b) Termination of Application of Title IV.--On and after 
the effective date of the extension under subsection (a)(2) of 
nondiscriminatory treatment to the products of a country, title 
IV of the Trade Act of 1974 shall cease to apply to that 
country.

                     Title I of Public Law 102-182


            NTR Treatment for Estonia, Latvia, and Lithuania


                         [19 U.S.C. 2434 note]

SEC. 101. CONGRESSIONAL FINDINGS.

    The Congress finds the following:
          (1) The Government of the United States extended full 
        diplomatic recognition to Estonia, Latvia, and 
        Lithuania in 1922.
          (2) The Government of the United States entered into 
        agreements extending most-favored-nation treatment with 
        the Government of Estonia on August 1, 1925, the 
        Government of Latvia on April 30, 1926, and the 
        Government of Lithuania on July 10, 1926.
          (3) The Union of Soviet Socialist Republics 
        incorporated Estonia, Latvia, and Lithuania 
        involuntarily into the Union as a result of a secret 
        protocol to a German-Soviet agreement in 1939 which 
        assigned those three states to the Soviet sphere of 
        influence; and the Government of the United States has 
        at no time recognized the forcible incorporation of 
        those states into the Union of Soviet Socialist 
        Republics.
          (4) The Trade Agreements Extension Act of 1951 
        required the President to suspend, withdraw, or prevent 
        the application of trade benefits, including most-
        favored-nation treatment, to countries under the 
        domination or control of the world Communist movement.
          (5) In 1951, responsible representatives of Estonia, 
        Latvia, and Lithuania stated that they did not object 
        to the imposition of ``such controls as the Government 
        of the United States may consider to be appropriate'' 
        to the products of those countries, for such time as 
        those countries remained under Soviet domination or 
        control.
          (6) In 1990, the democratically elected governments 
        of Estonia, Latvia, and Lithuania declared the 
        restoration of their independence from the Union of 
        Soviet Socialist Republics.
          (7) The Government of the United States established 
        diplomatic relations with Estonia, Latvia, and 
        Lithuania on September 2, 1991, and on September 6, 
        1991, the State Council of the transitional government 
        of the Union of Soviet Socialist Republics recognized 
        the independence of Estonia, Latvia, and Lithuania, 
        thereby ending the involuntary incorporation of those 
        countries into, and the domination of those countries 
        by, the Soviet Union.
          (8) Immediate action should be taken to remove the 
        impediments, imposed in response to the circumstances 
        referred to in paragraph (5), in United States trade 
        laws to the extension of nondiscriminatory treatment 
        (most-favored-nation treatment) to the products of 
        those countries.
          (9) As a consequence of establishment of United 
        States diplomatic relations with Estonia, Latvia, and 
        Lithuania, these independent countries are eligible to 
        receive the benefits of the Generalized System of 
        Preferences provided for in title V of the Trade Act of 
        1974.

SEC. 102. EXTENSION OF NONDISCRIMINATORY TREATMENT TO THE PRODUCTS OF 
                    ESTONIA, LATVIA, AND LITHUANIA.

    (a) In General.--Notwithstanding any provision of title IV 
of the Trade Act of 1974 (19 U.S.C. 2431 et seq.) or any other 
provision of law, nondiscriminatory treatment (most-favored-
nation treatment) applies to the products of Estonia, Latvia, 
and Lithuania.
    [(b) Conforming Tariff Schedule Amendments.--Amendments to 
General Note 3(b) of the Harmonized Tariff Schedule of the 
United States relating to the application of column 2 rates of 
duty.]
    (c) Effective Date.--Subsection (a) and the amendments made 
by subsection (b) apply with respect to goods entered, or 
withdrawn from warehouse for consumption, on or after the 15th 
day after the date of the enactment of this Act.

SEC. 103. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE ACT OF 
                    1974 TO THE BALTICS.

    Title IV of the Trade Act of 1974 (19 U.S.C. 2431 et seq.) 
shall cease to apply to Estonia, Latvia, and Lithuania 
effective as of the 15th day after the date of the enactment of 
this Act.

SEC. 104. SENSE OF THE CONGRESS REGARDING PROMPT PROVISION OF GSP 
                    TREATMENT TO THE PRODUCTS OF ESTONIA, LATVIA, AND 
                    LITHUANIA.

    It is the sense of the Congress that the President should 
take prompt action under title V of the Trade Act of 1974 to 
provide preferential tariff treatment to the products of 
Estonia, Latvia, and Lithuania pursuant to the Generalized 
System of Preferences.

                    Section 1 of Public Law 102-420


               NTR Withdrawal from Serbia and Montenegro


                         [19 U.S.C. 2434 note]

SECTION 1. WITHDRAWAL OF MOST FAVORED NATION STATUS FROM SERBIA AND 
                    MONTENEGRO.

    (a) Findings.--The Congress finds that Serbia or Montenegro 
are not complying with the provisions of the Final Act of the 
Conference on Security and Cooperation in Europe (also known as 
the ``Helsinki Final Act''), particularly the provisions 
regarding human rights and humanitarian affairs and are not 
respecting minority rights in Kosovo and Vojvodina.
    (b) Withdrawal of MFN Status.--Except as provided in 
subsection (c), nondiscriminatory treatment shall not apply 
with respect to any goods that--
          (1) are the product of Serbia or Montenegro; and
          (2) are entered into the customs territory of the 
        United States on or after the 15th day after the date 
        of the enactment of this Act.
    (c) Restoration of Nondiscriminatory Treatment.--
Notwithstanding subsection (b), the President may restore 
nondiscriminatory treatment to goods that are the product of 
Serbia or Montenegro, as the case may be, 30 days after he 
certifies to the Congress that Serbia or Montenegro, as the 
case may be--
          (1) has ceased its armed conflict with the other 
        ethnic peoples of the region formerly comprising the 
        Socialist Federal Republic of Yugoslavia;
          (2) has agreed to respect the borders of the 6 
        republics that comprised the Socialist Federal Republic 
        of Yugoslavia under the 1974 Yugoslav Constitution; and
          (3) has ceased all support of Serbian forces inside 
        Bosnia-Hercegovina.

                           Public Law 104-162


                         [19 U.S.C. 2434 note]

SECTION 1. CONGRESSIONAL FINDINGS AND SUPPLEMENTAL ACTION.

  (a) Congressional Findings.--The Congress finds that 
Bulgaria--
           (1) has received most-favored-nation treatment since 
        1991 and has been found to be in full compliance with 
        the freedom of emigration requirements under title IV 
        of the Trade Act of 1974 since 1993;
           (2) has reversed many years of Communist 
        dictatorship and instituted a constitutional republic 
        ruled by a democratically elected government as well as 
        basic market-oriented reforms, including privatization;
           (3) is in the process of acceding to the General 
        Agreement on Tariffs and Trade (GATT) and the World 
        Trade Organization (WTO), and extension of 
        unconditional most-favored-nation treatment would 
        enable the United States to avail itself of all rights 
        under the GATT and the WTO with respect to Bulgaria; 
        and
           (4) has demonstrated a strong desire to build 
        friendly relationships and to cooperate fully with the 
        United States on trade matters.
   (b) Supplemental Action.--The Congress notes that the United 
States Trade Representative intends to negotiate with Bulgaria 
in order to preserve the commitments of that country under the 
bilateral commercial agreement in effect between that country 
and the United States that are consistent with the GATT and the 
WTO.

SEC. 2. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE ACT OF 1974 
                    TO BULGARIA.

   (a) Presidential Determinations and Extension of 
Nondiscriminatory Treatment.--Notwithstanding any provision of 
title IV of the Trade Act of 1974 (19 U.S.C. 2431 et seq.), the 
President may--
           (1) determine that such title should no longer apply 
        to Bulgaria; and
           (2) after making a determination under paragraph (1) 
        with respect to Bulgaria, proclaim the extension of 
        nondiscriminatory treatment (most-favored-nation 
        treatment) to the products of that country.
   (b) Termination of Application of Title IV.--On and after 
the effective date of the extension under subsection (a)(2) of 
nondiscriminatory treatment to the products of Bulgaria, title 
IV of the Trade Act of 1974 shall cease to apply to that 
country.

                           Public Law 104-171


                         [19 U.S.C. 2434 note]

SECTION 1. FINDINGS.

   The Congress finds that--
           (1) Romania emerged from years of brutal Communist 
        dictatorship in 1989 and approved a new Constitution 
        and elected a Parliament by 1991, laying the foundation 
        for a modern parliamentary democracy charged with 
        guaranteeing fundamental human rights, freedom of 
        expression, and respect for private property;
           (2) local elections, parliamentary elections, and 
        presidential elections have been held in Romania, and 
        1996 will mark the second nationwide presidential 
        elections under the new Constitution;
           (3) Romania has undertaken significant economic 
        reforms, including the establishment of a two-tier 
        banking system, the introduction of a modern tax 
        system, the freeing of most prices and elimination of 
        most subsidies, the adoption of a tariff-based trade 
        regime, and the rapid privatization of industry and 
        nearly all agriculture;
           (4) Romania concluded a bilateral investment treaty 
        with the United States in 1993, and both United States 
        investment in Romania and bilateral trade are 
        increasing rapidly;
           (5) Romania has received most-favored-nation 
        treatment since 1993, and has been found by the 
        President to be in full compliance with the freedom of 
        emigration requirements under title IV of the Trade Act 
        of 1974;
           (6) Romania is a member of the World Trade 
        Organization and extension of unconditional most-
        favored-nation treatment to the products of Romania 
        would enable the United States to avail itself of all 
        rights under the World Trade Organization with respect 
        to Romania; and
           (7) Romania has demonstrated a strong desire to 
        build friendly relationships and to cooperate fully 
        with the United States on trade matters.

SEC. 2. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE ACT OF 1974 
                    TO ROMANIA.

   (a) Presidential Determinations and Extension of 
Nondiscriminatory Treatment.--Notwithstanding any provision of 
title IV of the Trade Act of 1974 (19 U.S.C. 2431 et seq.), the 
President may--
           (1) determine that such title should no longer apply 
        to Romania; and
           (2) after making a determination under paragraph 
        (1), proclaim the extension of nondiscriminatory 
        treatment (most-favored-nation treatment) to the 
        products of that country.
   (b) Termination of Application of Title IV.--On and after 
the effective date of the extension under subsection (a)(2) of 
nondiscriminatory treatment to the products of Romania, title 
IV of the Trade Act of 1974 shall cease to apply to that 
country.

                           Public Law 104-203


SECTION 1. CONGRESSIONAL FINDINGS.

   The Congress finds that--
           (1) despite recent increases in acts of repression 
        by the Cambodian Government and growing government 
        corruption that has contributed to substantial 
        environmental degradation, Cambodia has made some 
        progress towards democratic rule after 20 years of 
        undemocratic regimes and civil war, and is striving to 
        rebuild its market economy;
           (2) extension of unconditional most-favored-nation 
        treatment would assist Cambodia in developing its 
        economy based on free market principles and becoming 
        competitive in the global marketplace;
           (3) establishing normal commercial relations on a 
        reciprocal basis with Cambodia will promote United 
        States exports to the rapidly growing Southeast Asian 
        region and expand opportunities for United States 
        business and investment in the Cambodian economy; and
           (4) expanding bilateral trade relations that 
        includes a commercial agreement may promote further 
        progress by Cambodia on human rights and democratic 
        rule and assist Cambodia in adopting regional and world 
        trading rules and principles.

SEC. 2. EXTENSION OF NONDISCRIMINATORY TREATMENT TO THE PRODUCTS OF 
                    CAMBODIA.

   (a) Harmonized Tariff Schedule Amendment.--General note 3(b) 
of the Harmonized Tariff Schedule of the United States is 
amended by striking ``Kampuchea''.
   (b) Effective Date.--The amendment made by subsection (a) 
applies with respect to goods entered, or withdrawn from 
warehouse for consumption, on or after the effective date of a 
notice published in the Federal Register by the United States 
Trade Representative that a trade agreement obligating 
reciprocal most-favored-nation treatment between Cambodia and 
the United States has entered into force.

SEC. 3. REPORT TO CONGRESS.

  The President shall submit to the Congress, not later than 18 
months after the date of the enactment of this Act, a report on 
the trade relations between the United States and Cambodia 
pursuant to the trade agreement described in section 2(b).

                      Section 2424 of P.L. 106-36.


                         [19 U.S.C. 2434 note]

SEC. 2424. EXTENSION OF NONDISCRIMINATORY TREATMENT (NORMAL TRADE 
                    RELATIONS TREATMENT) TO THE PRODUCTS OF MONGOLIA.

    (a) Findings.--The Congress finds that Mongolia--
          (1) has received normal trade relations treatment 
        since 1991 and has been found to be in full compliance 
        with the freedom of emigration requirements under title 
        IV of the Trade Act of 1974;
          (2) has emerged from nearly 70 years of communism and 
        dependence on the former Soviet Union, approving a new 
        constitution in 1992 which has established a modern 
        parliamentary democracy charged with guaranteeing 
        fundamental human rights, freedom of expression, and an 
        independent judiciary;
          (3) has held four national elections under the new 
        constitution, two presidential and two parliamentary, 
        thereby solidifying the nation's transition to 
        democracy;
          (4) has undertaken significant market-based economic 
        reforms, including privatization, the reduction of 
        government subsidies, the elimination of most price 
        controls and virtually all import tariffs, and the 
        closing of insolvent banks;
          (5) has concluded a bilateral trade treaty with the 
        United States in 1991, and a bilateral investment 
        treaty in 1994;
          (6) has acceded to the Agreement Establishing the 
        World Trade Organization, and extension of 
        unconditional normal trade relations treatment to the 
        products of Mongolia would enable the United States to 
        avail itself of all rights under the World Trade 
        Organization with respect to Mongolia; and
          (7) has demonstrated a strong desire to build 
        friendly relationships and to cooperate fully with the 
        United States on trade matters.
(b) Termination of Application of Title IV of the Trade Act of 
1974 to Mongolia.--
          (1) Presidental determinations and extensions of 
        nondiscriminatory treatment.--Notwithstanding any 
        provision of title IV of the Trade Act of 1974 (19 
        U.S.C. 2431 et seq.), the President may--
                  (A) determine that such title should no 
                longer apply to Mongolia; and
                  (B) after making a determination under 
                subparagraph (A) with respect to Mongolia, 
                proclaim the extension of nondiscriminatory 
                treatment (normal trade relations treatment) to 
                the products of that country.
          (2) Termination of application of title iv.--On or 
        after the effective date of the extension under 
        paragraph (1)(B) of nondiscriminatory treatment to the 
        products of Mongolia, title IV of the Trade Act of 1974 
        shall cease to apply to that country.

                    Section 301-302 of P.L. 106-200.

                         [19 U.S.C. 2434 note]

SEC. 301. NORMAL TRADE RELATIONS FOR ALBANIA.

    (a) Findings.--Congress makes the following findings:
          (1) Albania has been found to be in full compliance 
        with the freedom of emigration requirements under title 
        IV of the Trade Act of 1974.
          (2) Since its emergence from communism, Albania has 
        made progress toward democratic rule and the creation 
        of a free-market economy.
          (3) Albania has concluded a bilateral investment 
        treaty with the United States.
          (4) Albania has demonstrated a strong desire to build 
        a friendly relationship with the United States and has 
        been very cooperative with NATO and the international 
        community during and after the Kosova crisis.
          (5) The extension of unconditional normal trade 
        relations treatment to the products of Albania will 
        enable the United States to avail itself of all rights 
        under the World Trade Organization with respect to 
        Albania when that country becomes a member of the World 
        Trade Organization.
    (b) Termination of Application of Title IV of the Trade Act 
of 1974 to Albania.--
          (1) Presidential determinations and extensions of 
        nondiscriminatory treatment.--Notwithstanding any 
        provision of title IV of the Trade Act of 1974 (19 
        U.S.C. 2431 et seq.), the President may--
                  (A) determine that such title should no 
                longer apply to Albania; and
                  (B) after making a determination under 
                subparagraph (1) with respect to Albania, 
                proclaim the extension of nondiscriminatory 
                treatment (normal trade relations treatment) to 
                the products of that country.
          (2) Termination of application of title iv.--On or 
        after the effective date of the extension under 
        paragraph (1)(B) of nondiscriminatory treatment to the 
        products of Albania, title IV of the Trade Act of 1974 
        shall cease to apply to that country.

SEC. 302. NORMAL TRADE RELATIONS FOR KYRGYZSTAN.

    (a) Findings.--Congress makes the following findings:
          (1) Kyrgyzstan has been found to be in full 
        compliance with the freedom of emigration requirements 
        under title IV of the Trade Act of 1974.
          (2) Since its independence from the Soviet Union in 
        1991, Kyrgystan has made great progress toward 
        democratic rule and toward creating a free-market 
        economic system.
          (3) Kyrgyzstan concluded a bilateral investment 
        treaty with the United States in 1994.
          (4) Kyrgyzstan has demonstrated a strong desire to 
        build a friendly and cooperative relationship with the 
        United States.
          (5) The extension of unconditional normal trade 
        relations treatment to the products of Kyrgyzstan will 
        enable the United States to avail itself of all rights 
        under the World Trade Organization with respect to 
        Kyrgyzstan.
    (b) Termination of Application of Title IV of the Trade Act 
of 1974 to Kyrgyzstan.--
          (1) Presidential determinations and extension of 
        nondiscriminatory treatment.--Notwithstanding any 
        provision of title IV of the Trade Act of 1974 (19 
        U.S.C. 2431 et seq.), the President may--
                  (A) determine that such title should no 
                longer apply to Kyrgyzstan; and
                  (B) after making a determination under 
                subparagraph (A) with respect to Kyrgyzstan, 
                proclaim the extension of nondiscriminatory 
                treatment (normal trade relations treatment) to 
                the products of that country.
          (B) Termination of application of title iv.--On or 
        after the effective date of the extension under 
        paragraph (1)(B) of nondiscriminatory treatment to the 
        products of Kyrgyzstan, title IV of the Trade Act of 
        1974 shall cease to apply to that country.

                             P.L. 106-286.

                 NTR for the People's Republic of China

[19 U.S.C. 2431 note, 22 U.S.C. 6901-6903, 6911-6919, 6931, 6941-6943, 
                6951, 6961-6965, 6981-6984, 6991, 7001.]

SEC. 101. TERMINATION OF APPLICATION OF CHAPTER 1 OF TITLE IV OF THE 
                    TRADE ACT OF 1974 TO THE PEOPLE'S REPUBLIC OF 
                    CHINA.

    (a) Presidental Determinations and Extension of 
Nondiscriminatory Treatment.--Notwithstanding any provision of 
chapter 1 of title IV of the Trade Act of 1974 (19 U.S.C. 2431 
et seq.), as designated by section 3(a)(2) of this Act, the 
President may--
          (1) determine that such chapter should no longer 
        apply to the People's Republic of China; and
          (2) after making a determination under paragraph (1) 
        with respect to the People's Republic of China, 
        proclaim the extension of nondiscriminatory treatment 
        (normal trade relations treatment) to the products of 
        that country.
    (b) Accession of the People's Republic of China to the 
World Trade Organization.--Prior to making the determination 
provided for in subsection (a)(1) and pursuant to the 
provisions of section 122 of the Uruguay Round Agreements Act 
(19 U.S.C. 3532), the President shall transmit a report to 
Congress certifying that the terms and conditions for the 
accession of the People's Republic of China to the World Trade 
Organization are at least equivalent to those agreed between 
the United States and the People's Republic of China on 
November 15, 1999.

SEC. 102. EFFECTIVE DATE.

    (a) Effective Date of Nondiscriminatory Treatment.--The 
extension of nondiscriminatory treatment pursuant to section 
101(a) shall be effective no earlier than the effective date of 
the accession of the People's Republic of China to the World 
Trade Organization.
    (b) Termination of Applicability of Title IV.--On and after 
the effective date under subsection (a) of the extension of 
nondiscriminatory treatment to the products of the People's 
Republic of China, chapter 1 of title IV of the Trade Act of 
1974 (as designated by section 103(a)(2) of this Act) shall 
cease to apply to that country.

SEC. 103. RELIEF FROM MARKET DISRUPTION.

[Adds new Sections 921-423 to Title IV of Trade Act of 1974, reprinted 
                              elsewhere.]

SEC. 104. AMENDMENT TO SECTION 123 OF THE TRADE ACT OF 1974--
                    COMPENSATION AUTHORITY.

     [Amends Section 123(a)(1) of the Trade Act of 1974 (19 U.S.C. 
2133(a)(1)), reprinted elsewhere.]

           *       *       *       *       *       *       *


                          SEC. 202. FINDINGS.

      The Congress finds the following:
          (1) In 1980, the United States opened trade relations 
        with the People's Republic of China by entering into a 
        bilateral trade agreement, which was approved by joint 
        resolution enacted pursuant to section 405(c) of the 
        Trade Act of 1974.
          (2) Since 1980, the President has consistently 
        extended nondiscriminatory treatment to products of the 
        People's Republic of China, pursuant to his authority 
        under section 404 of the Trade Act of 1974.
          (3) Since 1980, the United States has entered into 
        several additional trade-related agreements with the 
        People's Republic of China, including a memorandum of 
        understanding on market access in 1992, two agreements 
        on intellectual property rights protection in 1992 and 
        1995, and an agreement on agricultural cooperation in 
        1999.
          (4) Trade in goods between the People's Republic of 
        China and the United States totaled almost 
        $95,000,000,000 in 1999, compared with approximately 
        $18,000,000,000 in 1989, representing growth of 
        approximately 428 percent over 10 years.
          (5) The United States merchandise trade deficit with 
        the People's Republic of China has grown from 
        approximately $6,000,000,000 in 1989 to over 
        $68,000,000,000 in 1999, a growth of over 1,000 
        percent.
          (6) The People's Republic of China currently 
        restricts imports through relatively high tariffs and 
        nontariff barriers, including import licensing, 
        technology transfer, and local content requirements.
          (7) United States businesses attempting to sell goods 
        to markets in the People's Republic of China have 
        complained of uneven application of tariffs, customs 
        procedures, and other laws, rules, and administrative 
        measures affecting their ability to sell their products 
        in the Chinese market.
          (8) On November 15, 1999, the United States and the 
        People's Republic of China concluded a bilateral 
        agreement concerning terms of the People's Republic of 
        China's eventual accession to the World Trade 
        Organization.
          (9) The commitments that the People's Republic of 
        China made in its November 15, 1999, agreement with the 
        United States promise to eliminate or greatly reduce 
        the principal barriers to trade with and investment in 
        the People's Republic of China, if those commitments 
        are effectively complied with and enforced.
          (10) The record of the People's Republic of China in 
        implementing trade-related commitments has been mixed. 
        While the People's Republic of China has generally met 
        the requirements of the 1992 market access memorandum 
        of understanding and the 1992 and 1995 agreements on 
        intellectual property rights protection, other measures 
        remain in place or have been put into place which tend 
        to diminish the benefit to United States businesses, 
        farmers, and workers from the People's Republic of 
        China's implementation of those earlier commitments. 
        Notably, administration of tariff-rate quotas and other 
        trade-related laws remains opaque, new local content 
        requirements have proliferated, restrictions on 
        importation of animal and plant products are not always 
        supported by sound science, and licensing requirements 
        for importation and distribution of goods remain 
        common. Finally, the Government of the People's 
        Republic of China has failed to cooperate with the 
        United States Customs Service in implementing a 1992 
        memorandum of understanding prohibiting trade in 
        products made by prison labor.
          (11) The human rights record of the People's Republic 
        of China is a matter of very serious concern to the 
        Congress. The Congress notes that the Department of 
        State's 1999 Country Reports on Human Rights Practices 
        for the People's Republic of China finds that ``[t]he 
        Government's poor human rights record deteriorated 
        markedly throughout the year, as the Government 
        intensified efforts to suppress dissent, particularly 
        organized dissent.''.
          (12) The Congress deplores violations by the 
        Government of the People's Republic of China of human 
        rights, religious freedoms, and worker rights that are 
        referred to in the Department of State's 1999 Country 
        Reports on Human Rights Practices for the People's 
        Republic of China, including the banning of the Falun 
        Gong spiritual movement, denial in many cases, 
        particularly politically sensitive ones, of effective 
        representation by counsel and public trials, 
        extrajudical killings and torture, forced abortion and 
        sterilization, restriction of access to Tibet and 
        Xinijiang, perpetuation of ``reeducation through 
        labor'', denial of the right of workers to organize 
        labor unions or bargain collectively with their 
        employers, and failure to implement a 1992 memorandum 
        of understanding prohibiting trade in products made by 
        prison labor.

SEC. 203. POLICY.

      It is the policy of the United States--
          (1) to develop trade relations that broaden the 
        benefits of trade, and lead to a leveling up, rather 
        than a leveling down, of labor, environmental, 
        commercial rule of law, market access, anticorruption, 
        and other standards across national borders;
          (2) to pursue effective enforcement of trade-related 
        and other international commitments by foreign 
        governments through enforcement mechanisms of 
        international organizations and through the application 
        of United States law as appropriate;
          (3) to encourage foreign governments to conduct both 
        commercial and noncommercial affairs according to the 
        rule of law developed through democratic processes;
          (4) to encourage the Government of the People's 
        Republic of China to afford its workers internationally 
        recognized worker rights;
          (5) to encourage the Government of the People's 
        Republic of China to protect the human rights of people 
        within the territory of the People's Republic of China, 
        and to take steps toward protecting such rights, 
        including, but not limited to--
                  (A) ratifying the International Covenant on 
                Civil and Political Rights;
                  (B) protecting the right to liberty of 
                movement and freedom to choose a residence 
                within the People's Republic of China and the 
                right to leave from and return to the People's 
                Republic of China; and
                  (C) affording a criminal defendant--
                          (i) the right to be tried in his or 
                        her presence, and to defend himself or 
                        herself in person or through legal 
                        assistance of his or her own choosing;
                          (ii) the right to be informed, if he 
                        or she does not have legal assistance, 
                        of the right set forth in clause (i);
                          (iii) the right to have legal 
                        assistance assigned to him or her in 
                        any case in which the interests of 
                        justice so require and without payment 
                        by him or her in any such case if he or 
                        she does not have sufficient means to 
                        pay for it;
                          (iv) the right to a fair and public 
                        hearing by a competent, independent, 
                        and impartial tribunal established by 
                        the law;
                          (v) the right to be presumed innocent 
                        until proved guilty according to law; 
                        and
                          (vi) the right to be tried without 
                        undue delay; and
          (6) to highlight in the United Nations Human Rights 
        Commission and in other appropriate fora violations of 
        human rights by foreign governments and to seek the 
        support of other governments in urging improvements in 
        human rights practices.

SEC. 204. DEFINITIONS.

    In this division:
          (1) Dispute settlement understanding.--The term 
        ``Dispute Settlement Understanding'' means the 
        Understanding on Rules and Procedures Governing the 
        Settlement of Disputes referred to in section 
        101(d)(16) of the Uruguay Round Agreements Act (19 
        U.S.C. 3511(16)).
          (2) Government of the people's republic of china.--
        The term ``Government of the People's Republic of 
        China'' means the central Government of the People's 
        Republic of China and any other governmental entity, 
        including any provincial, prefectural, or local entity 
        and any enterprise that is controlled by the central 
        Government or any such governmental entity or as to 
        which the central Government or any such governmental 
        entity is entitled to received a majority of the 
        profits.
          (3) Internationally recognized worker rights.--The 
        term ``internationally recognized worker rights'' has 
        the meaning given that term in section 507(4) of the 
        Trade Act of 1974 (19 U.S.C. 2467(4)) and includes the 
        right to the elimination of the ``worst forms of child 
        labor'', as defined in section 507(6) of the Trade Act 
        of 1974 (19 U.S.C. 2467(6)).
          (4) Trade representative.--The term ``Trade 
        Representative'' means the Unites States Trade 
        Representative.
          (5) WTO; world trade organization.--The terms ``WTO'' 
        and ``World Trade Organization'' mean the organization 
        established pursuant to the WTO Agreement.
          (6) WTO agreement.--The term ``WTO Agreement'' means 
        the Agreement Establishing the World Trade Organization 
        entered into on April 15, 1994.
          (7) WTO member.--The term ``WTO member'' has the 
        meaning given that term in section 2(10) of the Uruguay 
        Round Agreements Act (19 U.S.C. 3501(10)).

SEC. 301. ESTABLISHMENT OF CONGRESSIONAL-EXECUTIVE COMMISSION ON THE 
                    PEOPLE'S REPUBLIC OF CHINA.

    There is established a Congressional-Executive Commission 
on the People's Republic of China (in this title referred to as 
the ``Commission'').

SEC. 302. FUNCTIONS OF THE COMMISSION.

    (a) Monitoring Compliance With Human Rights.--The 
Commission shall monitor the acts of the People's Republic of 
China which reflect compliance with or violation of human 
rights, in particular, those contained in the International 
Covenant on Civil and Political Rights and in the Universal 
Declaration of Human Rights, including, but not limited to, 
effectively affording--
          (1) the right to engage in free expression without 
        fear of any prior restraints;
          (2) the right to peaceful assembly without 
        restrictions, in accordance with international law;
          (3) religious freedom, including the right to worship 
        free of involvement of and interference by the 
        government;
          (4) the right to liberty of movement and freedom to 
        choose a residence within the People's Republic of 
        China and the right to leave from and return to the 
        People's Republic of China;
          (5) the right of a criminal defendant--
                  (A) to be tried in his or her presence, and 
                to defend himself or herself in person or 
                through legal assistance of his or her own 
                choosing;
                  (B) to be informed, if he or she does not 
                have legal assistance, of the right set forth 
                in subparagraph (A);
                  (C) to have legal assistance assigned to him 
                or her in any case in which the interests of 
                justice so require and without payment by him 
                or her in any such case if he or she does not 
                have sufficient means to pay for it;
                  (D) to a fair and public hearing by a 
                competent, independent, and impartial tribunal 
                established by the law;
                  (E) to be presumed innocent until proved 
                guilty according to law; and
                  (F) to be tried without undue delay;
          (6) the right to be free from torture and other forms 
        of cruel or unusual punishment;
          (7) protection of internationally recognized worker 
        rights;
          (8) freedom from incarceration as punishment for 
        political opposition to the government;
          (9) freedom from incarceration as punishment for 
        exercising or advocating human rights (including those 
        described in this section);
          (10) freedom from arbitrary arrest, detention, or 
        exile;
          (11) the right to fair and public hearings by an 
        independent tribunal for the determination of a 
        citizen's rights and obligations; and
          (12) free choice of employment.
    (b) Victims Lists.--The Commission shall compile and 
maintain lists of persons believed to be imprisoned, detained, 
or placed under house arrest, tortured, or otherwise persecuted 
by the Government of the People's Republic of China due to 
their pursuit of the rights described in subsection (a). In 
compiling such lists, the Commission shall exercise appropriate 
discretion, including concerns regarding the safety and 
security of, and benefit to, the persons who may be included on 
the lists and their families.
    (c) Monitoring Development of Rule of Law.--The Commission 
shall monitor the development of the rule of law in the 
People's Republic of China, including, but not limited to--
          (1) progress toward the development of institutions 
        of democratic governance;
          (2) processes by which statutes, regulations, rules, 
        and other legal acts of the Government of the People's 
        Republic of China are developed and become binding 
        within the People's Republic of China;
          (3) the extent to which statutes, regulations, rules, 
        administrative and judicial decisions, and other legal 
        acts of the Government of the People's Republic of 
        China are published and are made accessible to the 
        public;
          (4) the extent to which administrative and judicial 
        decisions are supported by statements of reasons that 
        are based upon written statutes, regulations, rules, 
        and other legal acts of the Government of the People's 
        Republic of China;
          (5) the extent to which individuals are treated 
        equally under the laws of the People's Republic of 
        China without regard to citizenship;
          (6) the extent to which administrative and judicial 
        decisions are independent of political pressure or 
        governmental interference and are reviewed by entities 
        of appellate jurisdiction; and
          (7) the extent to which laws in the People's Republic 
        of China are written and administered in ways that are 
        consistent with international human rights standards, 
        including the requirements of the International 
        Covenant on Civil and Political Rights.
    (d) Bilateral Cooperation.--The Commission shall monitor 
and encourage the development of programs and activities of the 
United States Government and private organizations with a view 
toward increasing the interchange of people and ideas between 
the United States and the People's Republic of China and 
expanding cooperation in areas that include, but are not 
limited to--
          (1) increasing enforcement of human rights described 
        in subsection (a); and
          (2) developing the rule of law in the People's 
        Republic of China.
    (e) Contacts With Nongovernmental.--In performing the 
functions described in subsections (a) through (d), the 
Commission shall, as appropriate, seek out and maintain 
contacts with nongovernmental organizations, including 
receiving reports and updates from such organizations and 
evaluating such reports.
    (f) Cooperation With Special Coordinator.--In performing 
the functions described in subsections (a) through (d), the 
Commission shall cooperate with the Special Coordinator for 
Tibetan Issues in the Department of State.
    (g) Annual Reports.--The Commission shall issue a report to 
the President and the Congress not later than 12 months after 
the date of the enactment of this Act, and not later than the 
end of each 12-month period thereafter, setting forth the 
findings of the Commission during the preceding 12-month 
period, in carrying out subsections (a) through (c). The 
Commission's report may contain recommendations for legislative 
or executive action.
    (h) Specific Information in Annual Reports.--The 
Commission's report under subsection (g) shall include specific 
information as to the nature and implementation of laws or 
policies concerning the rights set forth in paragraphs (1) 
through (12) of subsection (a), and as to restrictions applied 
to or discrimination against persons exercising any of the 
rights set forth in such paragraphs.
    (i) Congressional Hearings on Annual Reports.--The 
Committee on International Relations of the House of 
Representatives shall, not later than 30 days after the receipt 
by the Congress of the report referred to in subsection (g), 
hold hearings on the contents of the report, including any 
recommendations contained therein, for the purpose of receiving 
testimony from Members of Congress, and such appropriate 
representatives of Federal departments and agencies, and 
interested persons and groups, as the committee deems 
advisable, with a view to reporting to the House of 
Representatives any appropriate legislation in furtherance of 
such recommendations. If any such legislation is considered by 
the Committee on International Relations within 45 days after 
receipt by the Congress of the Report referred to in subsection 
(g), it shall be reported by the committee not later than 60 
days after receipt by the Congress of such report.
          (2) The provisions of paragraph (1) are enacted by 
        the Congress--
                  (A) as an exercise of the rulemaking power of 
                the House of Representatives, and as such are 
                deemed a part of the rules of the House, and 
                they supersede other rules only to the extent 
                that they are inconsistent therewith; and
                  (B) with full recognition of the 
                constitutional right of the House to change the 
                rules (so far as relating to the procedure of 
                the House) at any time, in the same manner and 
                to the same extent as in the case of any other 
                rule of the House.
    (j) Supplemental Reports.--The Commission may submit to the 
President and the Congress reports that supplement the reports 
described in subsection (g), as appropriate, in carrying out 
subsections (a) through (c).

SEC. 303. MEMBERSHIP OF THE COMMISSION.

    (a) Selection and Appointment of Members.--The Commission 
shall be composed of 23 members as follows:
          (1) Nine Members of the House of Representatives 
        appointed by the Speaker of the House of 
        Representatives. Five members shall be selected from 
        the majority party and four members shall be selected, 
        after consultation with the minority leader of the 
        House, from the minority party.
          (2) Nine Members of the Senate appointed by the 
        President of the Senate. Five members shall be 
        selected, after consultation with the majority leader 
        of the Senate, from the majority party, and four 
        members shall be selected, after consultation with the 
        minority leader of the Senate, from the minority party.
          (3) One representative of the Department of State, 
        appointed by the President of the United States from 
        among officer and employees of that Department.
          (4) One representative of the Department of Commerce, 
        appointed by the President of the United States from 
        among officers and employees of that Department.
          (5) One representative of the Department of Labor, 
        appointed by the President of the United States from 
        among officers and employees of that Department.
          (6) Two at-large representatives, appointed by the 
        President of the United States, from among the officers 
        and employees of the executive branch.
    (b) Chairman and Cochairman.--
          (1) Designation of chairman.--At the beginning of 
        each odd-numbered Congress, the President of the 
        Senate, on the recommendation of the majority leader, 
        shall designate one of the members of the Commission 
        from the Senate as Chairman of the Commission. At the 
        beginning of each even-numbered Congress, the Speaker 
        of the House of Representatives shall designate one of 
        the members of the Commission from the House as 
        Chairman of the Commission.
          (2) Designation of cochairman.--At the beginning of 
        each odd-numbered Congress, the Speaker of the House of 
        Representatives shall designate one of the members of 
        the Commission from the House as Cochairman of the 
        Commission. At the beginning of each even-numbered 
        Congress, the President of the Senate, on the 
        recommendation of the majority leader, shall designate 
        one of the members of the Commission from the Senate as 
        Cochairman of the Commission.

SEC. 304. VOTES OF THE COMMISSION.

    Decisions of the Commission, including adoption of reports 
and recommendations to the executive branch or to the Congress, 
shall be made by a majority vote of the members of the 
Commission present and voting. Two-thirds of the Members of the 
Commission shall constitute a quorum for purposes of conducting 
business.

SEC. 305. EXPENDITURE OF APPROPRIATIONS.

    For each fiscal year for which an appropriation is made to 
the Commission, the Commission shall issue a report to the 
Congress on its expenditures under that appropriation.

SEC. 306. TESTIMONY OF WITNESSES, PRODUCTION OF EVIDENCE; ISSUANCE OF 
                    SUBPOENAS; ADMINISTRATION OF OATHS.

    In carrying out this title, the Commission may require, by 
subpoena or otherwise, the attendance and testimony of such 
witnesses and the production of such books, records, 
correspondence, memoranda, papers, documents, and 
electronically recorded data as its considers necessary. 
Subpoenas may be issued only pursuant to a two-thirds vote of 
members of the Commission present and voting. Subpoenas may be 
issued over the signature of the Chairman of the Commission or 
any person designated by the Chairman, and may be served by any 
person designated by the Chairman or such member. The Chairman 
of the Commission, or any member designated by the Chairman, 
may administer oaths to any witness.

SEC. 307. APPROPRIATIONS FOR THE COMMISSION.

    (a) Authorization; Disbursements.--
          (1) Authorization.--There are authorized to be 
        appropriated to the Commission for fiscal year 2001, 
        and each fiscal year thereafter, such sums as may be 
        necessary to enable it to carry out its functions. 
        Appropriations to the Commission are authorized to 
        remain available until expended.
          (2) Disbursements.--Appropriations to the Commission 
        shall be disbursed on vouchers approved--
                  (A) jointly by the Chairman and the 
                Cochairman; or
                  (B) by a majority of the members of the 
                personnel and administration committee 
                established pursuant to section 308.
    (b) Foreign Travel for Official Purposes.--Foreign travel 
for official purposes by members and staff of the Commission 
may be authorized by either the Chairman or the Cochairman.

SEC. 308. STAFF OF THE COMMISSION.

    (a) Personnel and Administration Committee.--The Commission 
shall have a personnel and administration committee composed of 
the Chairman, the Cochairman, the senior member of the 
Commission from the minority party of the House of 
Representatives, and the senior member of the Commission from 
the minority party of the Senate.
    (b) Committee Functions.--All decisions pertaining to the 
hiring, firing, and fixing of pay of personnel of the 
Commission shall be by a majority vote of the personnel and 
administration committee, except that--
          (1) the Chairman shall be entitled to appoint and fix 
        the pay of the staff director, and the Cochairman shall 
        be entitled to appoint and fix the pay of the 
        Cochairman's senior staff member; and
          (2) The Chairman and Cochairman shall each have the 
        authority to appoint, with the approval of the 
        personnel and administration committee, at least four 
        professional staff members who shall be responsible to 
        the Chairman or the Cochairman (as the case may be) who 
        appointed them.
Subject to subsection (d), the personnel and administration 
committee may appoint and fix the pay of such other personnel 
as it considers desirable.
    (c) Staff Appointments.--All staff appointments shall be 
made without regard to the provisions of title 5, United States 
Code, government appointments in the competitive service, and 
without regard to the provisions of chapter 51 and subchapter 
III of chapter 53 of such title relating to classification and 
general schedule pay rates.
    (d) Qualifications of Professional Staff.--The personnel 
and administration committee shall ensure that the professional 
staff of the Commission consists of persons with expertise in 
areas including human rights, internationally recognized worker 
rights, international economics, law (including international 
law), rule of law and other foreign assistance programming, 
Chinese politics, economy and culture, and the Chinese 
language.
    (e) Commission Employees as Congressional Employees.--
          (1) In general.--For purposes of pay and other 
        employment benefits, rights, and privileges, and for 
        all other purposes, any employee of the Commission 
        shall be considered to the a congressional employee as 
        defined in section 2107 of title 5, United States Code.
          (2) Competitive status.--For purposes of section 
        3304(c)(1) of title 5, United States Code, employees of 
        the Commission shall be considered as if they are in 
        positions in which they are paid by the Secretary of 
        the Senate or the Clerk of the House of 
        Representatives.

SEC. 309. PRINTING AND BINDING COSTS.

    For purposes of costs relating to printing and binding, 
including the costs of personnel detailed from the Government 
Printing Office, the Commission shall be deemed to be a 
committee of the Congress.

SEC. 401. REVIEW WITHIN THE WTO.

    It shall be the objective of the United States to obtain as 
part of the Protocol of Accession of the People's Republic of 
China to the WTO, an annual review within the WTO of the 
Compliance by the People's Republic of China with its terms of 
accession to the WTO.

SEC. 411. FINDINGS.

The Congress finds as follows:
    (1) The opening of world markets through the elimination of 
tariff and nontariff barriers has contributed to a 56-percent 
increase in exports of United States goods and services since 
1992.
    (2) Such export expansion, along with an increase in trade 
generally, has helped fuel the longest economic expansion in 
United States history.
    (3) The United States Government must continue to be 
vigilant in monitoring and enforcing the compliance by our 
trading partners with trade agreements in order for United 
States businesses, workers, and farmers to continue to benefit 
from the opportunities created by market-opening trade 
agreements.
    (4) The People's Republic of China, as part of its 
accession to the World Trade Organization, has committed to 
eliminating significant trade barriers in the agricultural, 
services, and manufacturing sectors that, if realized, would 
provide considerable opportunities for United States farmers, 
businesses, and workers.
    (5) For these opportunities to be fully realized, the 
United States Government must effectively monitor and enforce 
its rights under the agreements on the accession of the 
People's Republic of China to the WTO.

SEC. 412. PURPOSE.

    The purpose of this subtitle is to authorize additional 
resources for the agencies and departments engaged in 
monitoring and enforcement of United States trade agreements 
and trade laws with respect to the People's Republic of China.

SEC. 413. AUTHORIZATION OF APPROPRIATIONS.

    (a) Department of Commerce.--There is authorized to be 
appropriated to the Department of Commerce, in addition to 
amounts otherwise available for such purposes, such sums as 
many be necessary for fiscal year 2001, and each fiscal year 
thereafter, for additional staff for--
          (1) monitoring compliance by the People's Republic of 
        China with its commitments under the WTO, assisting 
        United States negotiators with ongoing negotiations in 
        the WTO, and defending United States antidumping and 
        countervailing duty measures with respect to products 
        of the People's Republic of China;
          (2) enforcement of United States trade laws with 
        respect to products of the People's Republic of China; 
        and
          (3) a Trade Law Technical Assistance Center to assist 
        small- and medium-sized businesses, workers, and unions 
        in evaluating potential remedies available under the 
        trade laws of the United States with respect to trade 
        involving the People's Republic of China.
    (b) Overseas Compliance Program.--
          (1) Authorization of appropriation.--There are 
        authorized to be appropriated to the Department of 
        Commerce and the Department of State, in addition to 
        amounts otherwise available, such sums as may be 
        necessary for fiscal year 2001, and each fiscal year 
        thereafter, to provide staff for monitoring in the 
        People's Republic of China that country's compliance 
        with its international trade obligations and to support 
        the enforcement of the trade laws of the United States, 
        as part of an Overseas Compliance Program which 
        monitors abroad compliance with international trade 
        obligations and supports the enforcement of United 
        States trade laws.
          (2) Reporting.--The annual report on compliance by 
        the People's Republic of China submitted to the 
        Congress under section 421 of this Act shall include 
        the findings of the Overseas Compliance Program with 
        respect to the People's Republic of China.
    (c) United States Trade Representative.--There are 
authorized to be appropriated to the Office of the United 
States Trade Representative, in addition to amounts otherwise 
available for such purposes, such sums as may be necessary for 
fiscal year 2001, and each fiscal year thereafter, for 
additional staff in--
          (1) the Office of the General Counsel, the Monitoring 
        and Enforcement Unit, and the Office of the Deputy 
        United States Trade Representative in Geneva, 
        Switzerland, to investigate, prosecute, and defend 
        cases before the WTO, and to administer United States 
        trade laws, including title III of the Trade Act of 
        1974 (19 U.S.C. 2411 et seq.) and other trade laws 
        relating to intellectual property, government 
        procurement, and telecommunications, with respect to 
        the People's Republic of China;
          (2) the Office of Economic Affairs, to analyze the 
        impact on the economy of the United States, including 
        United States exports, of acts of the Government of the 
        People's Republic of China affecting access to markets 
        in the People's Republic of China and to support the 
        Office of the General Counsel in presenting cases to 
        the WTO involving the People's Republic of China;
          (3) the geographic office for the People's Republic 
        of China; and
          (4) offices relating to the WTO and to different 
        sectors of the economy, including agriculture, 
        industry, services, and intellectual property rights 
        protection, to monitor and enforce the trade agreement 
        obligations of the People's Republic of China in those 
        sectors.
    (d) Department of Agriculture.--There are authorized to be 
appropriated to the Department of Agriculture, in addition to 
amounts otherwise available for such purposes, such sums as may 
be necessary for fiscal year 2001, and each fiscal year 
thereafter, for additional staff to increase legal and 
technical expertise in areas covered by trade agreements and 
United States trade law, including food safety and 
biotechnology, for purposes of monitoring compliance by the 
People's Republic of China with its trade agreement 
obligations.

SEC. 421. REPORT ON COMPLIANCE.

    (A) In General.--Not later than 1 year after the entry into 
force of the Protocol of Accession of the People's Republic of 
China to the WTO, and annually thereafter, the Trade 
Representative shall submit a report to Congress on compliance 
by the People's Republic of China with commitments made in 
connection with its accession to the World Trade Organization, 
including both multilateral commitments and any bilateral 
commitments made to the United States.
    (b) Public Participation.--In preparing the report 
described in subsection (a), the Trade Representative shall 
seek public participation by publishing a notice in the Federal 
Register and holding a public hearing.

SEC. 501. ESTABLISHMENT OF TASK FORCE.

    There is hereby established a task force on prohibition of 
importation of products of forced or prison labor from the 
People's Republic of China (hereafter in this subtitle referred 
to as the ``Task Force'').

SEC. 502. FUNCTIONS OF TASK FORCE.

    The Task Force shall monitor and promote effective 
enforcement of and compliance with section 307 of the Tariff 
Act of 1930 (19 U.S.C. 1307) by performing the following 
functions:
          (1) Coordinate closely with the United States Customs 
        Service to promote maximum effectiveness in the 
        enforcement by the Customs Service of section 307 of 
        the Tariff Act of 1930 with respect to the products of 
        the People's Republic of China. In order to assure such 
        coordination, the Customs Service shall keep the Task 
        Force informed, on a regular basis, of the progress of 
        its investigations of allegations that goods are being 
        entered into the United States, or that such entry is 
        being attempted, in violation of the prohibition in 
        section 307 of the Tarriff Act of 1930 on entry into 
        the United States of goods mined, produced, or 
        manufactured wholly or in part in the People's Republic 
        of China by convict labor, forced labor, or indentured 
        labor under penal sanctions. Such investigations may 
        include visits to foreign sites where goods allegedly 
        are being mined, produced, or manufactured in a manner 
        that would lead to prohibition of their importation 
        into the United States under section 307 of the Tarriff 
        Act of 1930.
          (2) Make recommendations to the Customs Service on 
        seeking new agreement with the People's Republic of 
        China to allow Customs Service officials to visit sites 
        where goods may be mined, produced, or manufactured by 
        convict labor, forced labor, or indentured labor under 
        penal sanctions.
          (3) Work with the Customs Service to assist the 
        People's Republic of China and other foreign 
        governments in monitoring the sale of goods mined, 
        produced, or manufactured by convict labor, forced 
        labor, or indentured labor under penal sanctions to 
        ensure that such goods are not exported to the United 
        States.
          (4) Coordinate closely with the Customs Service to 
        promote maximum effectiveness in the enforcement by the 
        Customs Service of section 307 of the Tariff Act of 
        1930 with respect to the products of the People's 
        Republic of China. In order to assure such 
        coordination, the Customs Service shall keep the Task 
        Force informed, on a regular basis, of the progress of 
        its monitoring of ports of the United States to ensure 
        that goods mined, produced, or manufactured wholly or 
        in part in the People's Republic of China by convict 
        labor, forced labor, or indentured labor under penal 
        sanctions are not imported into the United States.
          (5) Advise the Customs Service in performing such 
        other functions, consistent with existing authority, to 
        ensure the effective enforcement of section 307 of the 
        Tariff Act of 1930.
          (6) Provide to the Customs Service all information 
        obtained by the departments represented on the Task 
        Force relating to the use of convict labor, forced 
        labor, or/and indentured labor under penal sanctions in 
        the mining, production, or manufacture of goods which 
        may be imported into the United States.

SEC. 503. COMPOSITION OF TASK FORCE.

    The Secretary of the Treasury, the Secretary of Commerce, 
the Secretary of Labor, the Secretary of State, the 
Commissioner of Customs, and the heads of other executive 
branch agencies, as appropriate, acting through their 
respective designees at or above the level of Deputy Assistant 
Secretary, or in the case of the Customs Service, at or above 
the level of Assistant Commissioner, shall compose the Task 
Force. The designee of the Secretary of the Treasury shall 
chair the Task Force.

SEC. 504. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated for fiscal year 
2001, and each fiscal year thereafter, such sums as may be 
necessary for the Task Force to carry out the functions 
described in section 502.

SEC. 505. REPORTS TO CONGRESS.

    (a) Frequency of Reports.--Not later than the date that is 
1-year after the date of the enactment of this Act, and not 
later than the end of each 1-year period thereafter, the Task 
Force shall submit to the Congress a report on the work of the 
Task Force during the preceding 1-year period.
    (b) Contents of Reports.--Each report under subsection (a) 
shall set forth, at a minimum--
          (1) the number of allegations of violations of 
        section 307, of the Tariff Act of 1930 with respect to 
        products of the Peoples' Republic of China that were 
        investigated during the preceding 1-year period.
          (2) the number of actual violations of section 307 of 
        the Tariff Act of 1930 with respect to the products of 
        the People's Republic of China that were discovered 
        during the preceding 1-year period;
          (3) in the case of each attempted entry of products 
        of the People's Republic of China in violation of such 
        section 307 discovered during the preceding 1-year 
        period--
                  (A) the identity of the exporter of the 
                goods;
                  (B) the identity of the person or persons who 
                attempted to sell the goods for export; and
                  (C) the identity of all parties involved in 
                transshipment of the goods; and
          (4) such other information as the Task Force 
        considers useful in monitoring and enforcing compliance 
        with section 307 of the Tariff Act of 1930.

SEC. 511. ESTABLISHMENT OF TECHNICAL ASSISTANCE AND RULE OF LAW 
                    PROGRAMS.

    (a) Commerce Rule of Law Program.--The Secretary of 
Commerce, in consultation with the Secretary of State, is 
authorized to establish a program to conduct rule of law 
training and technical assistance related to commercial 
activities in the People's Republic of China.
    (b) Labor Rule of Law Program.--
          (1) In general.--The Secretary of Labor, in 
        consultation with the Secretary of State, is authorized 
        to establish a program to conduct rule of law training 
        and technical assistance related to the protection of 
        internationally recognized worker rights in the 
        People's Republic of China.
          (2) Use of amounts.--In carrying out paragraph (1), 
        the Secretary of Labor shall focus on activities 
        including, but not limited to--
                  (A) developing, laws, regulations, and other 
                measures to implement internationally 
                recognized worker rights;
                  (B) establishing national mechanisms for the 
                enforcement of national labor laws and 
                regulations;
                  (C) training government officials concerned 
                with implementation and enforcement of national 
                labor laws and regulations; and
                  (D) developing an educational infrastructure 
                to educate workers about their legal rights and 
                protections under national labor laws and 
                regulations.
          (3) Limitation.--The Secretary of Labor may not 
        provide assistant under the program established under 
        this subsection to the All-China Federation of Trade 
        Unions.
    (c) Legal System and Civil Society Rule of Law Program.--
The Secretary of State is authorized to establish a program to 
conduct rule of law training and technical assistance related 
to development of the legal system and civil society generally 
in the People's Republic of China.
    (d) Conduct of Programs.--The programs authorized by this 
section may be used to conduct activities such as seminars and 
workshops, drafting of commercial and labor codes, legal 
training, publications, financing the operating costs for 
nongovernmental organizations working in this area, and funding 
the travel of individuals to the United States and to the 
People's Republic of China to provide and receive training.

SEC. 512. ADMINISTRATIVE AUTHORITIES.

    In carrying out the programs authorized by section 511, the 
Secretary of Commerce and the Secretary of Labor (in 
consultation with the Secretary of State) may utilize any of 
the authorities contained in the Foreign Assistance Act of 1961 
and the Foreign Service Act of 1980.

SEC. 513. PROHIBITION RELATING TO HUMAN RIGHTS ABUSES.

    Amounts made available to carry out this subtitle may not 
be provided to a component of a ministry or other 
administrative unit of the national, provincial, or other local 
governments of the People's Republic of China, to a 
nongovernmental organization, or to an official of such 
governments or organizations, if the President has credible 
evidence that such component, administrative unit, organization 
or official has been materially responsible for the commission 
of human rights violations.

SEC. 514. AUTHORIZATION OF APPROPRIATIONS.

    (a) Commercial Law Program.--There are authorized to be 
appropriated to the Secretary of Commerce to carry out the 
program described in section 511(a) such sums as may be 
necessary for fiscal year 2001, and each fiscal year 
thereafter.
    (b) Labor Law Program.--There are authorized to be 
appropriated to the Secretary of Labor to carry out the program 
described in section 511(b) such sums as may be necessary for 
fiscal year 2001, and each fiscal year thereafter.
    (c) Legal System and Civil Society Rule of Law Program.--
There are authorized to be appropriated to the Secretary of 
State to carry out the program described in section 511(c) such 
sums as may be necessary for fiscal year 2001, and each fiscal 
year thereafter.
    (d) Construction With Other Laws.--Except as provided in 
this division, funds may be made available to carry out the 
purposes of this subtitle notwithstanding any other provision 
of law.

SEC. 601. ACCESSION OF TAIWAN TO THE WTO.

    It is the sense of the Congress that--
          (1) immediately upon approval by the General Council 
        of the WTO of the terms and conditions of the accession 
        of the People's Republic of China to the WTO, the 
        United States representative to the WTO should request 
        that the General Council of the WTO consider Taiwan's 
        accession to the WTO as the next order of business of 
        the Council during the same session; and
          (2) the United States should be prepared to 
        aggressively counter any WTO member, upon the approval 
        of the General Council of the WTO of the terms and 
        conditions of the accession of the People's Republic of 
        China to the WTO, to block the accession of Taiwan to 
        the WTO.

SEC. 701. AUTHORIZATIONS OF APPROPRIATIONS FOR BROADCASTING CAPITAL 
                    IMPROVEMENTS AND INTERNATIONAL BROADCASTING 
                    OPERATIONS.

    (a) Broadcasting Capital Imporvements.--In addition to such 
sums as may otherwise be authorized to be appropriated, there 
are authorized to be appropriated for ``Department of State and 
Related Agency, Related Agency, Broadcasting Board of 
Governors, Broadcasting Capital Improvements'' $65,000,000 for 
the fiscal year 2001.
    (b) International Broadcasting Operations.--
          (1) Authorization of approriations.--In addition to 
        such sums as are otherwise authorized to be 
        appropriated, there are authorized to be appropriated 
        $34,000,000 for each of the fiscal years 2001 and 2002 
        for ``Department of State and Related Agency, Related 
        Agency, Broadcasting Board of Governors, International 
        Broadcasting Operations'' for the purposes under 
        paragraph (2).
          (2) Uses of funds.--In addition to other authorized 
        purposes, funds appropriated pursuant to paragraph (1) 
        shall be used for the following:
                  (A) To increase personnel for the program 
                development office to enhance marketing 
                programming in the People's Republic of China 
                and neighboring countries.
                  (B) To enable Radio Free Asia's expansion of 
                news research, production, call-in show 
                capability, and web site/Internet enhancement 
                for the People's Republic of China and 
                neighboring countries.
                  (C) VOA enhancements including the opening of 
                new news bureaus in Taipei and Shanghai, 
                enhancement of TV Mandarin, and an increase of 
                stringer presence abroad.

  Sections 3001-3002 of P.L. 106-476: Extension of Nondiscriminatory 
                         Treatment to Georgia.

                         [19 U.S.C. 2434 note]

SEC. 3001. FINDINGS.

    Congress finds that Georgia has--
          (1) made considerable progress toward respecting 
        fundamental human rights consistent with the objectives 
        of title IV of the Trade Act of 1974;
          (2) adopted administrative procedures that accord its 
        citizens the right to emigrate, travel freely, and to 
        return to their country without restriction;
          (3) been found to be in full compliance with the 
        freedom of emigration provisions in title IV of the 
        Trade Act of 1974;
          (4) made progress toward democratic rule and creating 
        a free market economic system since its independence 
        from the Soviet Union;
          (5) demonstrated strong and effective enforcement of 
        internationally recognized core labor standards and a 
        commitment to continue to improve effective enforcement 
        of its laws reflecting such standards;
          (6) committed to developing a system of governance in 
        accordance with the provisions of the Final Act of the 
        Conference on Security and Cooperation in Europe (also 
        known as the ``Helsinki Final Act'') regarding human 
        rights and humanitarian affairs;
          (7) endeavored to address issues related to its 
        national and religious minorities and, as a member 
        state of the Organization for Security and Cooperation 
        in Europe (OSCE), committed to adopting special 
        measures for ensuring that persons belonging to 
        national minorities have full equality individually as 
        well as in community with other members of their group;
          (8) also committed to enacting legislation to provide 
        protection against incitement to violence against 
        persons or groups based on national, racial, ethnic, or 
        religious discrimination, hostility, or hatred, 
        including anti-Semitism;
          (9) continued to return communal properties 
        confiscated from national and religious minorities 
        during the Soviet period, facilitating the reemergence 
        of those communities in the national life of Georgia 
        and establishing the legal framework for completion of 
        this process in the future;
          (10) concluded a bilateral trade agreement with the 
        United States in 1993 and a bilateral investment treaty 
        in 1994;
          (11) demonstrated a strong desire to build a friendly 
        and cooperative relationship with the United States; 
        and
          (12) acceded to the World Trade Organization on June 
        14, 2000, and the extension of unconditional normal 
        trade relations treatment to the products of Georgia 
        will enable the United States to avail itself of all 
        rights under the World Trade Organization with respect 
        to Georgia.

SEC. 3002. TERMINATION OF APPLICATION OF TITLE IV OF THE TRADE ACT OF 
                    1974 TO GEORGIA.

    (A) Presidential Determinations and Extensions of 
Nondiscriminatory Treatment.--Notwithstanding any provision of 
title IV of the Trade Act of 1974 (19 U.S.C. 2431 et seq.), the 
President may--
          (1) determine that such title should no longer apply 
        to Georgia; and
          (2) after making a determination under paragraph (1) 
        with respect to Georgia, proclaim the extension of 
        nondiscriminatory treatment (normal trade relations 
        treatment) to the products of that country.
    (B) Termination of Application of Title IV.--On and after 
the effective date of the extension under subsection (a)(2) of 
nondiscriminatory treatment to the products of Georgia, title 
IV of the Trade Act of 1974 shall cease to apply to that 
country.

                 G. TRADE RELATIONS WITH NORTH AMERICA

   North American Free Trade Agreement Implementation Act, as amended

[19 U.S.C. 58c note, 3301, 3311-3317, 3331-3335, 3351-3358, 3371-3372, 
  3381-3382, 3391, 3421, 3431-3438, 3431 note, 3451, 3461-3463, 3471-
    3473; P.L. 103-182, as amended by P.L. 104-295 and P.L. 105-206]

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``North 
American Free Trade Agreement Implementation Act''.
    [(b) Table of Contents.]

SEC. 2. DEFINITIONS.

    For purposes of this Act:
          (1) Agreement.--The term ``Agreement'' means the 
        North American Free Trade Agreement approved by the 
        Congress under section 101(a).
          (2) HTS.--The term ``HTS'' means the Harmonized 
        Tariff Schedule of the United States.
          (3) Mexico.--Any reference to Mexico shall be 
        considered to be a reference to the United Mexican 
        States.
          (4) NAFTA country.--Except as provided in section 
        202, the term ``NAFTA country'' means--
                  (A) Canada for such time as the Agreement is 
                in force with respect to, and the United States 
                applies the Agreement to, Canada; and
                  (B) Mexico for such time as the Agreement is 
                in force with respect to, and the United States 
                applies the Agreement to, Mexico.
          (5) International trade commission.--The term 
        ``International Trade Commission means the United 
        States International Trade Commission.
          (6) Trade representative.--The term ``Trade 
        Representative'' means the United States Trade 
        Representative.

  TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE NORTH 
                     AMERICAN FREE TRADE AGREEMENT

SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE NORTH AMERICAN FREE 
                    TRADE AGREEMENT.

    (a) Approval of Agreement and Statement of Administrative 
Action.--Pursuant to section 1103 of the Omnibus Trade and 
Competitiveness Act of 1988 (19 U.S.C. 2903) and section 151 of 
the Trade Act of 1974 (19 U.S.C. 2191), the Congress approves--
          (1) the North American Free Trade Agreement entered 
        into on December 17, 1992, with the Governments of 
        Canada and Mexico and submitted to the Congress on 
        November 4, 1993; and
          (2) the statement of administrative action proposed 
        to implement the Agreement that was submitted to the 
        Congress on November 4, 1993.
    (b) Conditions for Entry Into Force of the Agreement.--The 
President is authorized to exchange notes with the Government 
of Canada or Mexico providing for the entry into force, on or 
after January 1, 1994, of the Agreement for the United States 
with respect to such country at such time as--
          (1) the President--
                  (A) determines that such country has 
                implemented the statutory changes necessary to 
                bring that country into compliance with its 
                obligations under the Agreement and has made 
                provision to implement the Uniform Regulations 
                provided for under article 511 of the Agreement 
                regarding the interpretation, application, and 
                administration of the rules of origin, and
                  (B) transmits a report to the House of 
                Representatives and the Senate setting forth 
                the determination under subparagraph (A) and 
                including, in the case of Mexico, a description 
                of the specific measures taken by that country 
                to--
                          (i) bring its laws into conformity 
                        with the requirements of the Schedule 
                        of Mexico in Annex 1904.15 of the 
                        Agreement, and
                          (ii) otherwise ensure the effective 
                        implementation of the binational panel 
                        review process under chapter 19 of the 
                        Agreement regarding final antidumping 
                        and countervailing duty determinations; 
                        and
          (2) the Government of such country exchanges notes 
        with the United States providing for the entry into 
        force of the North American Agreement on Environmental 
        Cooperation and the North American Agreement on Labor 
        Cooperation for that country and the United States.

SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES AND STATE LAW.

    (a) Relationship of Agreement to United States Law.--
          (1) United states law to prevail in conflict.--No 
        provision of the Agreement, nor the application of any 
        such provision to any person or circumstance, which is 
        inconsistent with any law of the United States shall 
        have effect.
          (2) Construction.--Nothing in this Act shall be 
        construed--
                  (A) to amend or modify any law of the United 
                States, including any law regarding--
                          (i) the protection of human, animal, 
                        or plant life or health,
                          (ii) the protection of the 
                        environment, or
                          (iii) motor carrier or worker safety; 
                        or
                  (B) to limit any authority conferred under 
                any law of the United States, including section 
                301 of the Trade Act of 1974;
    unless specifically provided for in this Act.
    (b) Relationship of Agreement to State Law.--
          (1) Federal-state consultation.--
                  (A) In general.--Upon the enactment of this 
                Act, the President shall, through the 
                intergovernmental policy advisory committees on 
                trade established under section 306(c)(2)(A) of 
                the Trade and Tariff Act of 1984, consult with 
                the States for the purpose of achieving 
                conformity of State laws and practices with the 
                Agreement.
                  (B) Federal-state consultation process.--The 
                Trade Representative shall establish within the 
                Office of the United States Trade 
                Representative a Federal-State consultation 
                process for addressing issues relating to the 
                Agreement that directly relate to, or will 
                potentially have a direct impact on, the 
                States. The Federal-State consultation process 
                shall include procedures under which--
                          (i) the Trade Representative will 
                        assist the States in identifying those 
                        State laws that may not conform with 
                        the Agreement but may be maintained 
                        under the Agreement by reason of being 
                        in effect before the Agreement entered 
                        into force;
                          (ii) the States will be informed on a 
                        continuing basis of matters under the 
                        Agreement that directly relate to, or 
                        will potentially have a direct impact 
                        on, the States;
                          (iii) the States will be provided 
                        opportunity to submit, on a continuing 
                        basis, to the Trade Representative 
                        information and advice with respect to 
                        matters referred to in clause (ii);
                          (iv) the Trade Representative will 
                        take into account the information and 
                        advice received from the States under 
                        clause (iii) when formulating United 
                        States positions regarding matters 
                        referred to clause (ii); and
                          (v) the States will be involved 
                        (including involvement through the 
                        inclusion of appropriate 
                        representatives of the States) to the 
                        greatest extent practicable at each 
                        stage of the development of United 
                        States positions regarding matters 
                        referred to in clause (ii) that will be 
                        addressed by committees, subcommittees, 
                        or working groups established under the 
                        Agreement or through dispute settlement 
                        processes provided for under the 
                        Agreement.
        The Federal Advisory Committee Act (5 U.S.C. App.) 
        shall not apply to the Federal-State consultation 
        process established by this paragraph.
          (2) Legal challenge.--No State law, or the 
        application thereof, may be declared invalid as to any 
        person or circumstance on the ground that the provision 
        or application is inconsistent with the Agreement, 
        except in an action brought by the United States for 
        the purpose of declaring such law or application 
        invalid.
          (3) Definition of state law.--For purposes of this 
        subsection, the term ``State law'' includes--
                  (A) any law of a political subdivision of a 
                State; and
                  (B) any State law regulating or taxing the 
                business of insurance.
    (c) Effect of Agreement With Respect to Private Remedies.--
No person other than the United States--
          (1) shall have any cause of action or defense under--
                  (A) the agreement or by virtue of 
                Congressional approval thereof, or
                  (B) the North American Agreement on 
                Environmental Cooperation or the North American 
                Agreement on Labor Cooperation; or
          (2) may challenge, in any action brought under any 
        provision of law, any action or inaction by any 
        department, agency, or other instrumentality of the 
        United States, any State, or any political subdivision 
        of a State on the ground that such action or inaction 
        is inconsistent with the Agreement, the North American 
        Agreement on Environmental Cooperation, or the North 
        American Agreement on Labor Cooperation.

SEC. 103. CONSULTATION AND LAYOVER REQUIREMENTS FOR, AND EFFECTIVE DATE 
                    OF, PROCLAIMED ACTIONS.

    (a) Consultation and Layover Requirements.--If a provision 
of this Act provides that the implementation of an action by 
the President by proclamation is subject to the consultation 
and layover requirements of this section, such action may be 
proclaimed only if--
          (1) the President has obtained advice regarding the 
        proposed action from--
                  (A) the appropriate advisory committees 
                established under section 135 of Trade Act of 
                1974, and
                  (B) the International Trade Commission;
          (2) the President has submitted a report to the 
        Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate that sets forth--
                  (A) the action proposed to be proclaimed and 
                the reasons therefor, and
                  (B) the advice obtained under paragraph (1);
          (3) a period of 60 calendar days, beginning with the 
        first day on which the President has met the 
        requirements of paragraphs (1) and (2) with respect to 
        such action, has expired; and
          (4) the President has consulted with such Committees 
        regarding the proposed action during the period 
        referred to in paragraph (3).
    (b) Effective Date of Certain Proclaimed Actions.--Any 
action proclaimed by the President under the authority of this 
Act that is not subject to the consultation and layover 
requirements under subsection(a) may not take effect before the 
15th day after the date on which the text of the proclamation 
is published in the Federal Register.

SEC. 104. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE AND 
                    INITIAL REGULATIONS.

    (a) Implementing Actions.--After the date of the enactment 
of this Act--
          (1) the President may proclaim such actions; and
          (2) other appropriate officers of the United States 
        Government may issue such regulations;
as may be necessary to ensure that any provision of this Act, 
or amendment made by this Act, that takes effect on the date 
the Agreement enters into force is appropriately implemented on 
such date, but no such proclamation or regulation may have an 
effective date earlier than the date of entry into force. The 
15-day restriction in section 103(b) on the taking effect of 
proclaimed actions is waived to the extent that the application 
of such restriction would prevent the taking effect on the date 
the Agreement enters into force of any action proclaimed under 
this section.
    (b) Initial Regulations.--Initial regulations necessary or 
appropriate to carry out the actions proposed in the statement 
of administrative action submitted under section 101(a)(2) to 
implement the Agreement shall, to the maximum extent feasible, 
be issued within 1 year after the date of entry into force of 
the Agreement; except that interim or initial regulations to 
implement those Uniform Regulations regarding rules of origin 
provided for under article 511 of the Agreement shall be issued 
no later than the date of entry into force of the Agreement. In 
the case of any implementing action that takes effect on a date 
after the date of entry into force of the Agreement, initial 
regulations to carry out that action shall, to the maximum 
extent feasible, be issued within 1 year after such effective 
date.

SEC. 105. UNITED STATES SECTION OF THE NAFTA SECRETARIAT.

    (a) Establishment of the United States Section.--The 
President is authorized to establish within any department or 
agency of the United States Government a United States Section 
of the Secretariat established under chapter 20 of the 
Agreement. The United States Section, subject to the oversight 
of the inter-agency group established under section 402, shall 
carry out its functions within the Secretariat to facilitate 
the operation of the Agreement, including the operation of 
chapters 19 and 20 of the Agreement and the work of the panels, 
extraordinary challenge committees, special committees, and 
scientific review boards convened under those chapters. The 
United States Section may not be considered to be an agency for 
purposes of section 552 of title 5, United States Code.
    (b) Authorization of Appropriations.--There are authorized 
to be appropriated for each fiscal year after fiscal year 1993 
to the department or agency within which the United States 
Section is established the lesser of--
          (1) such sums as may be necessary; or
          (2) $2,000,000;
for the establishment and operations of the United States 
Section and for the payment of the United States share of the 
expenses of binational panels and extraordinary challenge 
committees convened under chapter 19, and of the expenses 
incurred in dispute settlement proceedings under chapter 20, of 
the Agreement.
    (c) Reimbursement of Certain Expenses.--If, in accordance 
with Annex 2002.2 of the Agreement, the Canadian Section or the 
Mexican Section of the Secretariat provides funds to the United 
States Section during any fiscal year, as reimbursement for 
expenses by the Canadian Section or the Mexican Section in 
connection with settlement proceedings under chapter 19 or 20 
of the Agreement, the United States Section may retain and use 
such funds to carry out the functions described in subsection 
(a).

SEC. 106. APPOINTMENTS TO CHAPTER 20 PANEL PROCEEDINGS.

    (a) Consultation.--The Trade Representative shall consult 
with the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate 
regarding the selection and appointment of candidates for the 
rosters described in article 2009 of the Agreement.
    (b) Selection of Individuals With Environmental 
Expertise.--The United States shall, to the maximum extent 
practicable, encourage the selection of individuals who have 
expertise and experience in environmental issues for service in 
panel proceedings under chapter 20 of the Agreement to hear any 
challenge to a United States or State environmental law.

[SEC. 107. TERMINATION OR SUSPENSION OF UNITED STATES-CANADA FREE-TRADE 
                    AGREEMENT.

    [Amendment to section 501(c) of the United States-Canada 
Free-Trade Implementation Act of 1988 (reprinted elsewhere).]

[SEC. 108. CONGRESSIONAL INTENT REGARDING FUTURE ACCESSIONS.

    [See U.S. negotiating objectives.]

SEC. 109. EFFECTIVE DATES; EFFECT OF TERMINATION OF NAFTA STATUS.

    (a) Effective Dates.--
          (1) In general.--This title (other than the amendment 
        made by section 107) takes effect on the date of the 
        enactment of this Act.
          (2) Section 107 amendment.--The amendment made by 
        section 107 takes effect on the date the Agreement 
        enters into force between the United States and Canada.
    (b) Termination of NAFTA Status.--During any period in 
which a country ceases to be a NAFTA country, sections 101 
through 106 shall cease to have effect with respect to such 
country.

                      TITLE II--CUSTOMS PROVISIONS

SEC. 201. TARIFF MODIFICATIONS.

    (a) Tariff Modifications Provided for in the Agreement.--
          (1) Proclamation authority.--The President may 
        proclaim--
                  (A) such modifications or continuation of any 
                duty,
                  (B) such continuation of duty-free or excise 
                treatment, or
                  (C) such additional duties,
as the President determines to be necessary or appropriate to 
carry out or apply articles 302, 305, 307, 308, and 703 and 
Annexes 302.2, 307.1, 308.1, 308.2, 300-B, 703.2, and 703.3 of 
the Agreement.
          (2) Effect on mexican gsp status.--Notwithstanding 
        502(a)(2) of the Trade Act of 1974 (19 U.S.C. 
        2462(a)(2)), the President shall terminate the 
        designation of Mexico as a beneficiary developing 
        country for purposes of title V of the Trade Act of 
        1974 on the date of entry into force of the Agreement 
        between the United States and Mexico.
    (b) Other Tariff Modifications.--
          (1) In general.--Subject to paragraph (2) and the 
        consultation and layover requirements of section 
        103(a), the President may proclaim--
                  (A) such modifications or continuation of any 
                duty,
                  (B) such modifications as the United States 
                may agree to with Mexico or Canada regarding 
                the staging of any duty treatment set forth in 
                Annex 302.2 of the Agreement,
                  (C) such continuation of duty-free or excise 
                treatment, or
                  (D) such additional duties,
as the President determines to be necessary or appropriate to 
maintain the general level of reciprocal and mutually 
advantageous concessions with respect to Canada or Mexico 
provided for by the Agreement.
          (2) Special rule for articles with tariff phaseout 
        periods of more than 10 years.--The President may not 
        consider a request to accelerate the staging of duty 
        reductions for an article for which the United States 
        tariff phaseout period is more than 10 years if a 
        request for acceleration with respect to such article 
        has been denied in the preceding 3 calendar years.
    (c) Conversion to Ad Valorem Rates for Certain Textiles.--
For purposes of subsections (a) and (b), with respect to an 
article covered by Annex 300-B of the Agreement imported from 
Mexico for which the base rate in the Schedule of the United 
States in Annex 300-B is a specific or compound rate of duty, 
the President may substitute for the base rate an ad valorem 
rate that the President determines to be equivalent to the base 
rate.

SEC. 202. RULES OF ORIGIN.

    (a) Originating Goods.--
          (1) In general.--For purposes of implementing the 
        tariff treatment and quantitative restrictions provided 
        for under the Agreement, except as otherwise provided 
        in this section, a good originates in the territory or 
        a NAFTA country if--
                  (A) the good is wholly obtained or produced 
                entirely in the territory of one or more of the 
                NAFTA countries;
                  (B)(i) each nonoriginating material used in 
                the production of the good--
                          (I) undergoes an applicable change in 
                        tariff classification set out in Annex 
                        401 of the Agreement as a result of 
                        production occurring entirely in the 
                        territory of one or more of the NAFTA 
                        countries; or
                          (II) where no change in tariff 
                        classification is required, the good 
                        otherwise satisfies the applicable 
                        requirements of such Annex; and
                  (ii) the good satisfies all other applicable 
                requirements of this section;
                  (C) the good is produced entirely in the 
                territory of one or more of the NAFTA countries 
                exclusively from originating materials; or
                  (D) except for a good provided for in 
                chapters 61 through 63 of the HTS, the good is 
                produced entirely in the territory of one or 
                more of the NAFTA countries, but one or more of 
                the nonoriginating materials, that are provided 
                for as parts under the HTS and are used in the 
                production of the good, does not undergo a 
                change in tariff classification because--
                          (i) the good was imported into the 
                        territory of a NAFTA country in an 
                        unassembled or a disassembled form but 
                        was classified as an assembled good 
                        pursuant to General Rule of 
                        Interpretation 2(a) of the HTS; or
                          (ii)(I) the heading for the good 
                        provides for and specifically describes 
                        both the good itself and its parts and 
                        is not further subdivided into 
                        subheadings; or
                          (II) the subheading for the good 
                        provides for and specifically describes 
                        both the good itself and its parts.
          (2) Special rules.--
                  (A) Foreign-trade zones.--Subparagraph (B) of 
                paragraph (1) shall not apply to a good 
                produced in a foreign-trade zone or subzone 
                (established pursuant to the Act of June 18, 
                1934, commonly known as the Foreign Trade Zones 
                Act) that is entered for consumption in the 
                customs territory of the United States.
                  (B) Regional value-content requirement.--For 
                purposes of subparagraph (D) of paragraph (1), 
                a good shall be treated as originating in a 
                NAFTA country if the regional value-content of 
                the good, determined in accordance with 
                subsection (b), is not less than 60 percent 
                where the transaction value method is used, or 
                not less than 50 percent where the net cost 
                method is used, and the good satisfies all 
                other applicable requirements of this section.
    (b) Regional Value-Content.--
          (1) In general.--Except as provided in paragraph (5), 
        the regional value-content of a good shall be 
        calculated, at the choice of the exporter or producer 
        of the good, on the basis of--
                  (A) the transaction value method described in 
                paragraph (2); or
                  (B) the net cost method described in 
                paragraph (3).
          (2) Transaction value method.--
                  (A) In general.--An exporter or producer may 
                calculate the regional value-content of a good 
                on the basis of the following transaction value 
                method:



                               TV-VNM
    RVC           =     -------------------              100
                                 TV
------------------------------------------------------------------------



                  (B) Definitions.--For purposes of 
                subparagraph (A):
                          (i) The term ``RVC'' means the 
                        regional value-content, expressed as a 
                        percentage.
                          (ii) The term ``TV'' means the 
                        transaction value of the good adjusted 
                        to a F.O.B. basis.
                          (iii) The term ``VNM'' means the 
                        value of nonoriginating materials used 
                        by the producer in the production of 
                        the good.
          (3) Net cost method.--
                  (A) In general.--An exporter or producer may 
                calculate the regional value-content of a good 
                on the basis of the following net cost method:



                              NC-VNM
    RVC          =     --------------------              100
                                NC
------------------------------------------------------------------------



                  (B) Definitions.--For purposes of 
                subparagraph (A):
                          (i) The term ``RVC'' means the 
                        regional value-content, expressed as a 
                        percentage.
                          (ii) The term ``NC'' means the net 
                        cost of the good.
                          (iii) The term ``VNM'' means the 
                        value of nonoriginating materials used 
                        by the producer in the production of 
                        the good.
          (4) Value of nonoriginating materials used in 
        originating materials.--Except as provided in 
        subsection (c)(1), and for a motor vehicle identified 
        in subsection (c)(2) or a component identified in Annex 
        403.2 of the Agreement, the value of nonoriginating 
        materials used by the producer in the production of a 
        good shall not, for purposes of calculating the 
        regional value-content of the good under paragraph (2) 
        or (3), include the value of nonoriginating materials 
        used to produce originating materials that are 
        subsequently used in the production of the good.
          (5) Net cost method must be used in certain cases.--
        An exporter or producer shall calculate the regional 
        value-content of a good solely on the basis of the net 
        cost method described in paragraph (3), if--
                  (A) there is no transaction value for the 
                good;
                  (B) the transaction value of the good is 
                unacceptable under Article 1 of the Customs 
                Valuation Code;
                  (C) the good is sold by the producer to a 
                related person and the volume, by units of 
                quantity, of sales of identical or similar 
                goods to related persons during the six-month 
                period immediately preceding the month in which 
                the good is sold exceeds 85 percent of the 
                producer's total sales of such goods during 
                that period;
                  (D) the good is--
                          (i) a motor vehicle provided for in 
                        heading 8701 or 8702, subheadings 
                        8703.21 through 8703.90, or heading 
                        8704, 8705, or 8706;
                          (ii) identified in Annex 403.1 or 
                        403.2 of the Agreement and is for use 
                        in a motor vehicle provided for in 
                        heading 8701 or 8702, subheadings 
                        8703.21 through 8703.90, or heading 
                        8704, 8705, or 8706;
                          (iii) provided for in subheadings 
                        6401.10 through 6406.10; or
                          (iv) a word processing machine 
                        provided for in subheading 8469.10.00;
                  (E) the exporter or producer chooses to 
                accumulate the regional value-content of the 
                good in accordance with subsection (d); or
                  (F) the good is designated as an intermediate 
                material under paragraph (10) and is subject to 
                a regional value-content requirement.
          (6) Net cost method allowed for adjustments.--If an 
        exporter or producer of a good calculates the regional 
        value-content of the good on the basis of the 
        transaction value method and a NAFTA country 
        subsequently notifies the exporter or producer, during 
        the course of a verification conducted in accordance 
        with chapter 5 of the Agreement, that the transaction 
        value of the good or the value of any material used in 
        the production of the good must be adjusted or is 
        unacceptable under Article 1 of the Customs Valuation 
        Code, the exporter or producer may calculate the 
        regional value-content of the good on the basis of the 
        net cost method.
          (7) Review of adjustment.--Nothing in paragraph (6) 
        shall be construed to prevent any review or appeal 
        available in accordance with article 510 of the 
        Agreement with respect to an adjustment to or a 
        rejection of--
                  (A) the transaction value of a good; or
                  (B) the value of any material used in the 
                production of a good.
          (8) Calculating net cost.--The producer may, 
        consistent with regulations implementing this section, 
        calculate the net cost of a good under paragraph (3), 
        by--
                  (A) calculating the total cost incurred with 
                respect to all goods produced by that producer, 
                subtracting any sales promotion, marketing and 
                after-sales service costs, royalties, shipping 
                and packing costs, and nonallowable interest 
                costs that are included in the total cost of 
                all such goods, and reasonably allocating the 
                resulting net cost of those goods to the good;
                  (B) calculating the total cost incurred with 
                respect to all goods produced by that producer, 
                reasonably allocating the total cost to the 
                good, and subtracting any sales promotion, 
                marketing and after-sales service costs, 
                royalties, shipping and packing costs, and 
                nonallowable interest costs that are included 
                in the portion of the total cost allocated to 
                the good; or
                  (C) reasonably allocating each cost that is 
                part of the total cost incurred with respect to 
                the good so that the aggregate of these costs 
                does not include any sales promotion, marketing 
                and after-sales service costs, royalties, 
                shipping and packing costs, or nonallowable 
                interest costs.
          (9) Value of material used in production.--Except as 
        provided in paragraph (11), the value of a material 
        used in the production of a good--
                  (A) shall--
                          (i) be the transaction value of the 
                        material determined in accordance with 
                        Article 1 of the Customs Valuation 
                        Code; or
                          (ii) in the event that there is no 
                        transaction value or the transaction 
                        value of the material is unacceptable 
                        under Article 1 of the Customs 
                        Valuation Code, be determined in 
                        accordance with Articles 2 through 7 of 
                        the Customs Valuation Code; and
                  (B) if not included under clause (i) or (ii) 
                of subparagraph (A), shall include--
                          (i) freight, insurance, packing, and 
                        all other costs incurred in 
                        transporting the material to the 
                        location of the producer;
                          (ii) duties, taxes, and customs 
                        brokerage fees paid on the material in 
                        the territory of one or more of the 
                        NAFTA countries; and
                          (iii) the cost of waste and spoilage 
                        resulting from the use of the material 
                        in the production of the good, less the 
                        value of renewable scrap or by-product.
          (10) Intermediate material.--Except for goods 
        described in subsection (c)(1), any self-produced 
        material, other than a component identified in Annex 
        403.2 of the Agreement, that is used in the production 
        of a good may be designated by the producer of the good 
        as an intermediate material for the purpose of 
        calculating the regional value-content of the good 
        under paragraph (2) or (3); provided that if the 
        intermediate material is subject to a regional value-
        content requirement, no other self-produced material 
        that is subject to a regional value-content requirement 
        and is used in the production of the intermediate 
        material may be designated by the producer as an 
        intermediate material.
          (11) Value of intermediate material.--The value of an 
        intermediate material shall be--
                  (A) the total cost incurred with respect to 
                all goods produced by the producer of the good 
                that can be reasonably allocated to the 
                intermediate material; or
                  (B) the aggregate of each cost that is part 
                of the total cost incurred with respect to the 
                intermediate material that can be reasonably 
                allocated to that intermediate material.
          (12) Indirect material.--The value of an indirect 
        material shall be based on the Generally Accepted 
        Accounting Principles applicable in the territory of 
        the NAFTA country in which the good is produced.
    (c) Automotive Goods.--
          (1) Passenger vehicles and light trucks, and their 
        automotive parts.--For purposes of calculating the 
        regional value-content under the net cost method for--
                  (A) a good that is a motor vehicle for the 
                transport of 15 or fewer persons provided for 
                in subheading 8702.10.00 or 8702.90.00, or a 
                motor vehicle provided for in subheadings 
                8703.21 through 8703.90, or subheading 8704.21 
                or 8704.31, or
                  (B) a good provided for in the tariff 
                provisions listed in Annex 403.1 of the 
                Agreement, that is subject to a regional value-
                content requirement and is for use as original 
                equipment in the production of a motor vehicle 
                for the transport of 15 or fewer persons 
                provided for in subheading 8702.10.00 or 
                8702.90.00, or a motor vehicle provided for in 
                subheadings 8703.21 through 8703.90, or 
                subheading 8704.21 or 8704.31,
        the value of nonoriginating materials used by the 
        producer in the production of the good shall be the sum 
        of the values of all nonoriginating materials, 
        determined in accordance with subsection (b)(9) at the 
        time the nonoriginating materials are received by the 
        first person in the territory of a NAFTA country who 
        takes title to them, that are imported from outside the 
        territories of the NAFTA countries under the tariff 
        provisions listed in Annex 403.1 of the Agreement and 
        are used in the production of the good or that are used 
        in the production of any material used in the 
        production of the good.
          (2) Other vehicles and their automotive parts.--For 
        purposes of calculating the regional value-content 
        under the net cost method for a good that is a motor 
        vehicle provided for in heading 8701, subheading 
        8704.10, 8704.22, 8704.23, 8704.32, or 8704.90, or 
        heading 8705 or 8706, a motor vehicle for the transport 
        of 16 or more persons provided for in subheading 
        8702.10.00 or 8702.90.00, or a component identified in 
        Annex 403.2 of the Agreement for use as original 
        equipment in the production of the motor vehicle, the 
        value of nonoriginating materials used by the producer 
        in the production of the good shall be the sum of--
                  (A) for each material used by the producer 
                listed in Annex 403.2 of the Agreement, whether 
                or not produced by the producer, at the choice 
                of the producer and determined in accordance 
                with subsection (b), either--
                          (i) the value of such material that 
                        is nonoriginating, or
                          (ii) the value of nonoriginating 
                        materials used in the production of 
                        such material; and
                  (B) the value of any other nonoriginating 
                material used by the producer that is not 
                listed in Annex 403.2 of the Agreement 
                determined in accordance with subsection (b).
          (3) Averaging permitted.--
                  (A) In general.--For purposes of calculating 
                the regional value-content of a motor vehicle 
                described in paragraph (1) or (2), the producer 
                may average its calculation over its fiscal 
                year, using any of the categories described in 
                subparagraph (B), on the basis of either all 
                motor vehicles in the category or on the basis 
                of only the motor vehicles in the category that 
                are exported to the territory of one or more of 
                the other NAFTA countries.
                  (B) Category described.--A category is 
                described in this subparagraph if it is--
                          (i) the same model line of motor 
                        vehicles in the same class of vehicles 
                        produced in the same plant in the 
                        territory of a NAFTA country;
                          (ii) the same class of motor vehicles 
                        produced in the same plant in the 
                        territory of a NAFTA country;
                          (iii) the same model line of motor 
                        vehicles produced in the territory of a 
                        NAFTA country; or
                          (iv) if applicable, the basis set out 
                        in Annex 403.3 of the Agreement.
          (4) Annex 403.1 and annex 403.2.--For purposes of 
        calculating the regional value-content for any or all 
        goods provided for in a tariff provision listed in 
        Annex 403.1 of the Agreement, or a component or 
        material identified in Annex 403.2 of the Agreement, 
        produced in the same plant, the producer of the good 
        may--
                  (A) average its calculation--
                          (i) over the fiscal year of the motor 
                        vehicle producer to whom the good is 
                        sold;
                          (ii) over any quarter or month; or
                          (iii) over its fiscal year, if the 
                        good is sold as an aftermarket part;
                  (B) calculate the average referred to in 
                subparagraph (A) separately for any or all 
                goods sold to one or more motor vehicle 
                producers; or
                  (C) with respect to any calculation under 
                this paragraph, make a separate calculation for 
                goods that are exported to the territory of one 
                or more NAFTA countries.
          (5) Phase-in of regional value-content requirement.--
        Notwithstanding Annex 401 of the Agreement, and except 
        as provided in paragraph (6), the regional value-
        content requirement shall be--
                  (A) for a producer's fiscal year beginning on 
                the day closest to January 1, 1998, and 
                thereafter, 56 percent calculated under the net 
                cost method, and for a producer's fiscal year 
                beginning on the day closest to January 1, 
                2002, and thereafter, 62.5 percent calculated 
                under the net cost method, for--
                          (i) a good that is a motor vehicle 
                        for the transport of 15 or fewer 
                        persons provided for in subheading 
                        8702.10.00 or 8702.90.00, or a motor 
                        vehicle provided for in subheadings 
                        8703.21 through 8703.90, or subheading 
                        8704.21 or 8704.31; and
                          (ii) a good provided for in heading 
                        8407 or 8408, or subheading 8708.40, 
                        that is for use in a motor vehicle 
                        identified in clause (i); and
                  (B) for a producer's fiscal year beginning on 
                the day closest to January 1, 1998, and 
                thereafter, 55 percent calculated under the net 
                cost method, and for a producer's fiscal year 
                beginning on the day closest to January 1, 
                2002, and thereafter, 60 percent calculated 
                under the net cost method, for--
                          (i) a good that is a motor vehicle 
                        provided for in heading 8701, 
                        subheading 8704.10, 8704.22, 8704.23, 
                        8704.32, or 8704.90, or heading 8705 or 
                        8706, or a motor vehicle for the 
                        transport of 16 or more persons 
                        provided for in subheading 8702.10.00 
                        or 8702.90.00;
                          (ii) a good provided for in heading 
                        8407 or 8408, or subheading 8708.40 
                        that is for use in a motor vehicle 
                        identified in clause (i); and
                          (iii) except for a good identified in 
                        subparagraph (A)(ii) or a good provided 
                        for in subheadings 8482.10 through 
                        8482.80, or subheading 8483.20 or 
                        8483.30, a good identified in Annex 
                        403.1 of the Agreement that is subject 
                        to a regional value-content requirement 
                        and is for use in a motor vehicle 
                        identified in subparagraph (A)(i) or 
                        (B)(i).
          (6) New and refitted plants.--The regional value-
        content requirement for a motor vehicle identified in 
        paragraph (1) or (2) shall be--
                  (A) 50 percent for 5 years after the date on 
                which the first motor vehicle prototype is 
                produced in a plant by a motor vehicle 
                assembler, if--
                          (i) it is a motor vehicle of a class, 
                        or marque, or, except for a motor 
                        vehicle identified in paragraph (2), 
                        size category and underbody, not 
                        previously produced by the motor 
                        vehicle assembler in the territory of 
                        any of the NAFTA countries;
                          (ii) the plant consists of a new 
                        building in which the motor vehicle is 
                        assembled; and
                          (iii) the plant contains 
                        substantially all new machinery that is 
                        used in the assembly of the motor 
                        vehicle; or
                  (B) 50 percent for 2 years after the date on 
                which the first motor vehicle prototype is 
                produced at a plant following a refit, if it is 
                a motor vehicle of a class, or marque, or, 
                except for a motor vehicle identified in 
                paragraph (2), size category and underbody, 
                different from that assembled by the motor 
                vehicle assembler in the plant before the 
                refit.
          (7) Election for certain vehicles from canada.--In 
        the case of goods provided for in subheadings 8703.21 
        through 8703.90, or subheading 8704.21 or 8704.31, 
        exported from Canada directly to the United States, and 
        entered on or after January 1, 1989, and before the 
        date of entry into force of the Agreement between the 
        United States and Canada, an importer may elect to use 
        the rules of origin set out in this section in lieu of 
        the rules of origin contained in section 202 of the 
        United States-Canada Free-Trade Agreement 
        Implementation Act of 1988 (19 U.S.C. 2112 note) and 
        may elect to use the method for calculating the value 
        of nonoriginating materials established in article 
        403(2) of the Agreement in lieu of the method 
        established in article 403(1) of the Agreement for 
        purposes of determining eligibility for preferential 
        duty treatment under the United States-Canada Free-
        Trade Agreement. Any election under this paragraph 
        shall be made in writing to the Customs Service not 
        later than the date that is 180 days after the date of 
        entry into force of the Agreement between the United 
        States and Canada. Any such election may be made only 
        if the liquidation of such entry has not become final. 
        For purposes of averaging the calculation of regional 
        value-content for the goods covered by such entry, 
        where the producer's 1989-1990 fiscal year began after 
        January 1, 1989, the producer may include the period 
        between January 1, 1989, and the beginning of its first 
        fiscal year after January 1, 1989, as part of fiscal 
        year 1989-1990.
    (d) Accumulation.--
          (1) Determination of originating good.--For purposes 
        of determining whether a good is an originating good, 
        the production of the good in the territory of one or 
        more of the NAFTA countries by one or more producers 
        shall, at the choice of the exporter or producer of the 
        good, be considered to have been performed in the 
        territory of any of the NAFTA countries by that 
        exporter or producer, if--
                  (A) all nonoriginating materials used in the 
                production of the good undergo an applicable 
                tariff classification change set out in Annex 
                401 of the Agreement;
                  (B) the good satisfies any applicable 
                regional value-content requirement; and
                  (C) the good satisfies all other applicable 
                requirements of this section.
        The requirements of subparagraphs (A) and (B) must be 
        satisfied entirely in the territory of one or more of 
        the NAFTA countries.
          (2) Treatment as single producer.--For purposes of 
        subsection (b)(10), the production of a producer that 
        chooses to accumulate its production with that of other 
        producers under paragraph (1) shall be treated as the 
        production of a single producer.
    (e) De Minimis Amounts of Nonoriginating Materials.--
          (1) In general.--Except as provided in paragraphs 
        (3), (4), (5), and (6), a good shall be considered to 
        be an originating good if--
                  (A) the value of all nonoriginating materials 
                used in the production of the good that do not 
                undergo an applicable change in tariff 
                classification (set out in Annex 401 of the 
                Agreement) is not more than 7 percent of the 
                transaction value of the good, adjusted to a 
                F.O.B. basis, or
                  (B) where the transaction value of the good 
                is unacceptable under Article 1 of the Customs 
                Valuation Code, the value of all such 
                nonoriginating materials is not more than 7 
                percent of the total cost of the good,
        provided that the good satisfies all other applicable 
        requirements of this section and, if the good is 
        subject to a regional value-content requirement, the 
        value of such nonoriginating materials is taken into 
        account in calculating the regional value-content of 
        the good.
          (2) Goods not subject to regional value-content 
        requirement.--A good that is otherwise subject to a 
        regional value-content requirement shall not be 
        required to satisfy such requirement if--
                  (A)(i) the value of all nonoriginating 
                materials used in the production of the good is 
                not more than 7 percent of the transaction 
                value of the good, adjusted to a F.O.B. basis; 
                or
                  (ii) where the transaction value of the good 
                is unacceptable under Article 1 of the Customs 
                Valuation Code, the value of all nonoriginating 
                materials is not more than 7 percent of the 
                total cost of the good; and
                  (B) the good satisfies all other applicable 
                requirements of this section.
          (3) Dairy products, etc.--Paragraph (1) does not 
        apply to--
                  (A) a nonoriginating material provided for in 
                chapter 4 of the HTS or a dairy preparation 
                containing over 10 percent by weight of milk 
                solids provided for in subheading 1901.90.30, 
                1901.90.40, or 1901.90.80 that is used in the 
                production of a good provided for in chapter 4 
                of the HTS;
                  (B) a nonoriginating material provided for in 
                chapter 4 of the HTS or a dairy preparation 
                containing over 10 percent by weight of milk 
                solids provided for in subheading 1901.90.30, 
                1901.90.40, or 1901.90.80 that is used in the 
                production of--
                          (i) preparations for infants 
                        containing over 10 percent by weight of 
                        milk solids provided for in subheading 
                        1901.10.00;
                          (ii) mixes and doughs, containing 
                        over 25 percent by weight of butterfat, 
                        not put up for retail sale, provided 
                        for in subheading 1901.20.00;
                          (iii) a dairy preparation containing 
                        over 10 percent by weight of milk 
                        solids provided for in subheading 
                        1901.90.30, 1901.90.40, or 1901.90.80;
                          (iv) a good provided for in heading 
                        2105 or subheading 2106.90.05, or 
                        preparations containing over 10 percent 
                        by weight of milk solids provided for 
                        in subheading 2106.90.15, 2106.90.40, 
                        2106.90.50, or 2106.90.65;
                          (v) a good provided for in subheading 
                        2202.90.10 or 2202.90.20; or
                          (vi) animal feeds containing over 10 
                        percent by weight of milk solids 
                        provided for in subheading 2309.90.30;
                  (C) a nonoriginating material provided for in 
                heading 0805 or subheadings 2009.11 through 
                2009.30 that is used in the production of--
                          (i) a good provided for in 
                        subheadings 2009.11 through 2009.30, or 
                        subheading 2106.90.16, or concentrated 
                        fruit or vegetable juice of any single 
                        fruit or vegetable, fortified with 
                        minerals or vitamins, provided for in 
                        subheading 2106.90.19; or
                          (ii) a good provided for in 
                        subheading 2202.90.30 or 2202.90.35, or 
                        fruit or vegetable juice of any single 
                        fruit or vegetable, fortified with 
                        minerals or vitamins, provided for in 
                        subheading 2202.90.36;
                  (D) a nonoriginating material provided for in 
                chapter 9 of the HTS that is used in the 
                production of instant coffee, not flavored, 
                provided for in subheading 2101.10.20;
                  (E) a nonoriginating material provided for in 
                chapter 15 of the HTS that is used in the 
                production of a good provided for in headings 
                1501 through 1508, or heading 1512, 1514, or 
                1515;
                  (F) a nonoriginating material provided for in 
                heading 1701 that is used in the production of 
                a good provided for in headings 1701 through 
                1703;
                  (G) a nonoriginating material provided for in 
                chapter 17 of the HTS or heading 1805 that is 
                used in the production of a good provided for 
                in subheading 1806.10;
                  (H) a nonoriginating material provided for in 
                headings 2203 through 2208 that is used in the 
                production of a good provided for in headings 
                2207 through 2208;
                  (I) a nonoriginating material used in the 
                production of--
                          (i) a good provided for in subheading 
                        7321.11.30;
                          (ii) a good provided for in 
                        subheading 8415.10, subheadings 8415.81 
                        through 8415.83, subheadings 8418.10 
                        through 8418.21, subheadings 8418.29 
                        through 8418.40, subheading 8421.12 or 
                        8422.11, subheadings 8450.11 through 
                        8450.20, or subheadings 8451.21 through 
                        8451.29;
                          (iii) trash compactors provided for 
                        in subheading 8479.89.60; or
                          (iv) a good provided for in 
                        subheading 8516.60.40; and
                  (J) a printed circuit assembly that is a 
                nonoriginating material used in the production 
                of a good where the applicable change in tariff 
                classification for the good, as set out in 
                Annex 401 of the Agreement, places restrictions 
                on the use of such nonoriginating material.
          (4) Certain fruit juices.--Paragraph (1) does not 
        apply to a nonoriginating single juice ingredient 
        provided for in heading 2009 that is used in the 
        production of--
                  (A) a good provided for in subheading 
                2009.90, or concentrated mixtures of fruit or 
                vegetable juice, fortified with minerals or 
                vitamins, provided for in subheading 
                2106.90.19; or
                  (B) mixtures of fruit or vegetable juices, 
                fortified with minerals or vitamins, provided 
                for in subheading 2202.90.39.
          (5) Goods provided for in chapters 1 through 27 of 
        the hts.--Paragraph (1) does not apply to a 
        nonoriginating material used in the production of a 
        good provided for in chapters 1 through 27 of the HTS 
        unless the nonoriginating material is provided for in a 
        different subheading than the good for which origin is 
        being determined under this section.
          (6) Goods provided for in chapters 50 through 63 of 
        the hts.--A good provided for in chapters 50 through 63 
        of the HTS, that does not originate because certain 
        fibers or yarns used in the production of the component 
        of the good that determines the tariff classification 
        of the good do not undergo an applicable change in 
        tariff classification set out in Annex 401 of the 
        Agreement, shall be considered to be a good that 
        originates if the total weight of all such fibers or 
        yarns in that component is not more than 7 percent of 
        the total weight of that component.
    (f) Fungible Goods and Materials.--For purposes of 
determining whether a good is an originating good--
          (1) if originating and nonoriginating fungible 
        materials are used in the production of the good, the 
        determination of whether the materials are originating 
        need not be made through the identification of any 
        specific fungible material, but may be determined on 
        the basis of any of the inventory management methods 
        set out in regulations implementing this section; and
          (2) if originating and nonoriginating fungible goods 
        are commingled and exported in the same form, the 
        determination may be made on the basis of any of the 
        inventory management methods set out in regulations 
        implementing this section.
    (g) Accessories, Spare Parts, or Tools.--
          (1) In general.--Except as provided in paragraph (2), 
        accessories, spare parts, or tools delivered with the 
        good that form part of the good's standards 
        accessories, spare parts, or tools shall--
                  (A) be considered as originating goods if the 
                good is an originating good, and
                  (B) be disregarded in determining whether all 
                the nonoriginating materials used in the 
                production of the good undergo an applicable 
                change in tariff classification set out in 
                Annex 401 of the Agreement.
          (2) Conditions.--Paragraph (1) shall apply only if--
                  (A) the accessories, spare parts, or tools 
                are not invoiced separately from the good;
                  (B) the quantities and value of the 
                accessories, spare parts, or tools are 
                customary for the good; and
                  (C) in any case in which the good is subject 
                to a regional value-content requirement, the 
                value of the accessories, spare parts, or tools 
                are taken into account as originating or 
                nonoriginating materials, as the case may be, 
                in calculating the regional value-content of 
                the good.
    (h) Indirect Materials.--An indirect material shall be 
considered to be an originating material without regard to 
where it is produced.
    (i) Packaging Materials and Containers for Retail Sale.--
Packaging materials and containers in which a good is packaged 
for retail sale, if classified with the good, shall be 
disregarded in determining whether all the nonoriginating 
materials used in the production of the good undergo an 
applicable change in tariff classification set out in Annex 401 
of the Agreement. If the good is subject to a regional value-
content requirement, the value of such packaging materials and 
containers shall be taken into account as originating or 
nonoriginating materials, as the case may be, in calculating 
the regional value-content of the good.
    (j) Packing Materials and Containers for Shipment.--Packing 
materials and containers in which a good is packed for shipment 
shall be disregarded--
          (1) in determining whether the nonoriginating 
        materials used in the production of the good undergo an 
        applicable change in tariff classification set out in 
        Annex 401 of the Agreement; and
          (2) in determining whether the good satisfies a 
        regional value-content requirement.
    (k) Transshipment.--A good shall not be considered to be an 
originating good by reason of having undergone production that 
satisfies the requirements of subsection (a) if, subsequent to 
that production, the good undergoes further production or any 
other operation outside the territories of the NAFTA countries, 
other than unloading, reloading, or any other operation 
necessary to preserve it in good condition or to transport the 
good to the territory of a NAFTA country.
    (l) Nonqualifying Operations.--A good shall not be 
considered to be an originating good merely by reason of--
          (1) mere dilution with water or another substance 
        that does not materially alter the characteristics of 
        the good; or
          (2) any production or pricing practice with respect 
        to which it may be demonstrated, by a preponderance of 
        evidence, that the object was to circumvent this 
        section.
    (m) Interpretation and Application.--For purposes of this 
section:
          (1) The basis for any tariff classification is the 
        HTS.
          (2) Except as otherwise expressly provided, whenever 
        in this section there is a reference to a heading or 
        subheading such reference shall be a reference to a 
        heading or subheading of the HTS.
          (3) In applying subsection (a)(4), the determination 
        of whether a heading or subheading under the HTS 
        provides for and specifically describes both a good and 
        its parts shall be made on the basis of the 
        nomenclature of the heading or subheading, the rules of 
        interpretation, or notes of the HTS.
          (4) In applying the Customs Valuation Code--
                  (A) the principles of the Customs Valuation 
                Code shall apply to domestic transactions, with 
                such modifications as may be required by the 
                circumstances, as would apply to international 
                transactions;
                  (B) the provisions of this section shall take 
                precedence over the Customs Valuation Code to 
                the extent of any difference; and
                  (C) the definitions in subsection (p) shall 
                take precedence over the definitions in the 
                Customs Valuation Code to the extent of any 
                difference.
          (5) All costs referred to in this section shall be 
        recorded and maintained in accordance with the 
        Generally Accepted Accounting Principles applicable in 
        the territory of the NAFTA country in which the good is 
        produced.
    (n) Origin of Automatic Data Processing Goods.--
Notwithstanding any other provision of this section, when the 
NAFTA countries apply the rate of duty described in paragraph 1 
of section A of Annex 308.1 of the Agreement to a good provided 
for under the tariff provisions set out in Table 308.1.1 of 
such Annex, the good shall, upon importation from a NAFTA 
country, be deemed to originate in the territory of a NAFTA 
country for purposes of this section.
    (o) Special Rule for Certain Agricultural Products.--
Notwithstanding any other provision of this section, for 
purposes of applying a rate of duty to a good provided for in--
          (1) heading 1202 that is exported from the territory 
        of Mexico, if the good is not wholly obtained in the 
        territory of Mexico,
          (2) subheading 2008.11 that is exported from the 
        territory of Mexico, if any material provided for in 
        heading 1202 used in the production of that good is not 
        wholly obtained in the territory of Mexico, or
          (3) subheading 1806.10.42 or 2106.90.12 that is 
        exported from the territory of Mexico, if any material 
        provided for in subheading 1701.99 used in the 
        production of that good is not a qualifying good,
such good shall be treated as a nonoriginating good and, for 
purposes of this subsection, the terms ``qualifying good'' and 
``wholly obtained in the territory of'' have the meaning given 
such terms in paragraph 26 of section A of Annex 703.2 of the 
Agreement.
    (p) Definitions.--For purposes of this section--
          (1) Class of motor vehicles.--The term ``class of 
        motor vehicles'' means any one of the following 
        categories of motor vehicles:
                  (A) Motor vehicles provided for in subheading 
                8701.20, subheading 8704.10, 8704.22, 8704.23, 
                8704.32, or 8704.90, or heading 8705 or 8706, 
                or motor vehicles designed for the transport of 
                16 or more persons provided for in subheading 
                8702.10.00 or 8702.90.00.
                  (B) Motor vehicles provided for in subheading 
                8701.10, or subheading 8701.30 through 8701.90.
                  (C) Motor vehicles for the transport of 15 or 
                fewer persons provided for in subheading 
                8702.10.00 or 8702.90.00, or motor vehicles 
                provided for in subheading 8704.21 or 8704.31.
                  (D) Motor vehicles provided for in 
                subheadings 8703.21 through 8703.90.
          (2) Customs valuation code.--The term ``Customs 
        Valuation Code'' means the Agreement on Implementation 
        of Article VII of the General Agreement on Tariffs and 
        Trade, including its interpretative notes.
          (3) F.O.B.--The term ``F.O.B.'' means free on board, 
        regardless of the mode of transportation, at the point 
        of direct shipment by the seller to the buyer.
          (4) Fungible goods and fungible materials.--The terms 
        ``fungible goods'' and fungible materials'' means goods 
        or materials that are interchangeable for commercial 
        purposes and whose properties are essentially 
        identical.
          (5) Generally accepted accounting principles.--The 
        term ``Generally Accepted Accounting Principles'' means 
        the recognized consensus or substantial authoritative 
        support in the territory of a NAFTA country with 
        respect to the recording of revenues, expenses, costs, 
        assets and liabilities, disclosure of information, and 
        preparation of financial statements. These standards 
        may be broad guidelines of general application as well 
        as detailed standards, practices, or procedures.
          (6) Goods wholly obtained or produced entirely in the 
        territory of one or more of the nafta countries.--The 
        term ``goods wholly obtained or produced entirely in 
        the territory of one or more of the NAFTA countries'' 
        means--
                  (A) mineral goods extracted in the territory 
                of one or more of the NAFTA countries;
                  (B) vegetable goods harvested in the 
                territory of one or more of the NAFTA 
                countries;
                  (C) live animals born and raised in the 
                territory of one or more of the NAFTA 
                countries;
                  (D) goods obtained from hunting, trapping, or 
                fishing in the territory of one or more of the 
                NAFTA countries;
                  (E) goods (such as fish, shellfish, and other 
                marine life) taken from the sea by vessels 
                registered or recorded with a NAFTA country and 
                flying its flag;
                  (F) goods produced on board factory ships 
                from the goods referred to in subparagraph (E), 
                if such factory ships are registered or 
                recorded with the NAFTA country and fly its 
                flag;
                  (G) goods taken by a NAFTA country or a 
                person of a NAFTA country from the seabed or 
                beneath the seabed outside territorial waters, 
                provided that a NAFTA country has rights to 
                exploit such seabed;
                  (H) goods taken from outer space, if the 
                goods are obtained by a NAFTA country or a 
                person of a NAFTA country and not processed in 
                a country other than a NAFTA country;
                  (I) waste and scrap derived from--
                          (i) production in the territory of 
                        one or more of the NAFTA countries; or
                          (ii) used goods collected in the 
                        territory of one or more of the NAFTA 
                        countries, if such goods are fit only 
                        for the recovery of raw materials; and
                  (J) goods produced in the territory of one or 
                more of the NAFTA countries exclusively from 
                goods referred to in subparagraphs (A) through 
                (I), or from their derivatives, at any stage of 
                production.
          (7) Identical or similar goods.--The term ``identical 
        or similar goods'' means ``identical goods'' and 
        ``similar goods'', respectively, as defined in the 
        Customs Valuation Code.
          (8) Indirect material.--
                  (A) The term ``indirect material'' means a 
                good--
                          (i) used in the production, testing, 
                        or inspection of a good but not 
                        physically incorporated into the good, 
                        or
                          (ii) used in the maintenance of 
                        buildings or the operation of equipment 
                        associated with the production of a 
                        good,
                in the territory of one or more of the NAFTA 
                countries.
                  (B) When used for a purpose described in 
                subparagraph (A), the following materials are 
                among those considered to be indirect 
                materials:
                          (i) Fuel and energy.
                          (ii) Tools, dies, and molds.
                          (iii) Spare parts and materials used 
                        in the maintenance of equipment and 
                        buildings.
                          (iv) Lubricants, greases, compounding 
                        materials, and other materials used in 
                        production or used to operate equipment 
                        and buildings.
                          (v) Gloves, glasses, footwear, 
                        clothing, safety equipment, and 
                        supplies.
                          (vi) Equipment, devices, and supplies 
                        used for testing or inspecting the 
                        goods.
                          (vii) Catalysts and solvents.
                          (viii) Any other goods that are not 
                        incorporated into the good, if the use 
                        of such goods in the production of the 
                        good can reasonably be demonstrated to 
                        be a part of that production.
          (9) Intermediate material.--The term ``intermediate 
        material'' means a material that is self-produced, used 
        in the production of a good, and designated pursuant to 
        subsection (b)(10).
          (10) Marque.--The term ``marque'' means the trade 
        name used by a separate marketing division of a motor 
        vehicle assembler.
          (11) Material.--The term ``material'' means a good 
        that is used in the production of another good and 
        includes a part or an ingredient.
          (12) Model line.--The term ``model line'' means a 
        group of motor vehicles having the same platform or 
        model name.
          (13) Motor vehicle assembler.--The term ``motor 
        vehicle assembler'' means a producer of motor vehicles 
        and any related persons or joint ventures in which the 
        producer participates.
          (14) NAFTA country.--The term ``NAFTA country'' means 
        the United States, Canada or Mexico for such time as 
        the Agreement is in force with respect to Canada or 
        Mexico, and the United States applies the Agreement to 
        Canada or Mexico.
          (15) New building.--The term ``new building'' means a 
        new construction, including at least the pouring or 
        construction of new foundation and floor, the erection 
        of a new structure and roof, and installation of new 
        plumbing, electrical, and other utilities to house a 
        complete vehicle assembly process.
          (16) Net cost.--The term ``net cost'' means total 
        cost less sales promotion, marketing and after-sales 
        service costs, royalties, shipping and packing costs, 
        and nonallowable interest costs that are included in 
        the total cost.
          (17) Net cost of a good.--The term ``net cost of a 
        good'' means the net cost that can be reasonably 
        allocated to a good using one of the methods set out in 
        subsection (b)(8).
          (18) Nonallowable interest costs.--The term 
        ``nonallowable interest costs'' means interest costs 
        incurred by a producer as a result of an interest rate 
        that exceeds the applicable Federal Government interest 
        rate for comparable maturities by more than 700 basis 
        points, determined pursuant to regulations implementing 
        this section.
          (19) Nonoriginating good; nonoriginating material.--
        The term ``nonoriginating good'' or ``nonoriginating 
        material'' means a good or material that does not 
        qualify as an originating good or material under the 
        rules of origin set out in this section.
          (20) Originating.--The term ``originating'' means 
        qualifying under the rules of origin set out in this 
        section.
          (21) Producer.--The term ``producer'' means a person 
        who grows, mines, harvests, fishes, traps, hunts, 
        manufacturers, processes, or assembles a good.
          (22) Production.--The term ``production'' means 
        growing, mining, harvesting, fishing, trapping, 
        hunting, manufacturing, processing, or assembling a 
        good.
          (23) Reasonably allocate.--The term ``reasonably 
        allocate'' means to apportion in a manner appropriate 
        to the circumstances.
          (24) Refit.--The term ``refit'' means a plant 
        closure, for purposes of plant conversion or retooling, 
        that lasts at least 3 months.
          (25) Related persons.--The term ``related persons'' 
        means persons specified in any of the following 
        subparagraphs:
                  (A) Persons who are officers or directors of 
                one another's businesses.
                  (B) Persons who are legally recognized 
                partners in business.
                  (C) Persons who are employer and employee.
                  (D) Persons one of whom owns, controls, or 
                holds 25 percent or more of the outstanding 
                voting stock or shares of the other.
                  (E) Persons if 25 percent or more of the 
                outstanding voting stock or shares of each of 
                them is directly or indirectly owned, 
                controlled, or held by a third person.
                  (F) Persons one of whom is directly or 
                indirectly controlled by the other.
                  (G) Persons who are directly or indirectly 
                controlled by a third person.
                  (H) Persons who are members of the same 
                family.
        For purposes of this paragraph, the term ``members of 
        the same family'' means natural or adoptive children, 
        brothers, sisters, parents, grandparents, or spouses.
          (26) Royalties.--The term ``royalties'' means 
        payments of any kind, including payments under 
        technical assistance or similar agreements, made as 
        consideration for the use or right to use any 
        copyright, literary, artistic, or scientific work, 
        patent, trademark, design, model, plan, secret formula, 
        or process. It does not include payments under 
        technical assistance or similar agreements that can be 
        related to specific services such as--
                  (A) personnel training, without regard to 
                where performed; and
                  (B) if performed in the territory of one or 
                more of the NAFTA countries, engineering, 
                tooling, die-setting, software design and 
                similar computer services, or other services.
          (27) Sales promotion, marketing, and after-sales 
        service costs.--The term ``sales promotion, marketing, 
        and after-sales service costs'' means the costs related 
        to sales promotion, marketing, and after-sales service 
        for the following:
                  (A) Sales and marketing promotion, media 
                advertising, advertising and market research, 
                promotional and demonstration materials, 
                exhibits, sales conferences, trade shows, 
                conventions, banners, marketing displays, free 
                samples, sales, marketing and after-sales 
                service literature (product brochures, 
                catalogs, technical literature, price lists, 
                service manuals, sales aid information), 
                establishment and protection of logos and 
                trademarks, sponsorships, wholesale and retail 
                restocking charges, and entertainment.
                  (B) Sales and marketing incentives, consumer, 
                retailer, or wholesaler rebates, and 
                merchandise incentives.
                  (C) Salaries and wages, sales commissions, 
                bonuses, benefits (such as medical, insurance, 
                and pension), traveling and living expenses, 
                and membership and professional fees for sales 
                promotion, marketing, and after-sales service 
                personnel.
                  (D) Recruiting and training of sales 
                promotion, marketing, and after-sales service 
                personnel, and after-sales training of 
                customers' employees, where such costs are 
                identified separately for sales promotion, 
                marketing, and after-sales service of goods on 
                the financial statements or cost accounts of 
                the producer.
                  (E) Product liability insurance.
                  (F) Office supplies for sales promotion, 
                marketing, and after-sales service of goods, 
                where such costs are identified separately for 
                sales promotion, marketing, and after-sales 
                service of goods on the financial statements or 
                cost accounts of the producer.
                  (G) Telephone, mail, and other 
                communications, where such costs are identified 
                separately for sales promotion, marketing, and 
                after-sales service of goods on the financial 
                statements or cost accounts of the producer.
                  (H) Rent and depreciation of sales promotion, 
                marketing, and after-sales service offices and 
                distribution centers.
                  (I) Property insurance, taxes, utilities, and 
                repair and maintenance of sales promotion, 
                marketing, and after-sales service offices and 
                distribution centers, where such costs are 
                identified separately for sales promotion, 
                marketing, and after-sales service of goods on 
                the financial statements or cost accounts of 
                the producer.
                  (J) Payments by the producer to other persons 
                for warranty repairs.
          (28) Self-produced material.--The term ``self-
        produced material'' means a material that is produced 
        by the producer of a good and used in the production of 
        that good.
          (29) Shipping and packing costs.--The term ``shipping 
        and packing costs'' means the costs incurred in packing 
        a good for shipment and shipping the good from the 
        point of direct shipment to the buyer, but does not 
        include the costs of preparing and packaging the good 
        for retail sale.
          (30) Size category.--The term ``size category'' means 
        with respect to a motor vehicle identified in 
        subsection (c)(1)(A)--
                  (A) 85 cubic feet or less of passenger and 
                luggage interior volume;
                  (B) more than 85 cubic feet, but less than 
                100 cubic feet, of passenger and luggage 
                interior volume;
                  (C) at least 100 cubic feet, but not more 
                than 110 cubic feet, of passenger and luggage 
                interior volume;
                  (D) more than 110 cubic feet, but less than 
                120 cubic feet, of passenger and luggage 
                interior volume; and
                  (E) 120 cubic feet or more of passenger and 
                luggage interior volume.
          (31) Territory.--The term ``territory'' means a 
        territory described in Annex 201.1 of the Agreement.
          (32) Total cost.--The term ``total cost'' means all 
        product costs, period costs, and other costs incurred 
        in the territory of one or more of the NAFTA countries.
          (33) Transaction value.--Except as provided in 
        subsection (c)(1) or (c)(2)(A), the term ``transaction 
        value'' means the price actually paid or payable for a 
        good or material with respect to a transaction of the 
        producer of the good, adjusted in accordance with the 
        principles of paragraphs 1, 3, and 4 of Article 8 of 
        the Customs Valuation Code and determined without 
        regard to whether the good or material is sold for 
        export.
          (34) Underbody.--The term ``underbody'' means the 
        floor pan of a motor vehicle.
          (35) Used.--The term ``used'' means used or consumed 
        in the production of goods.
    (q) Presidential Proclamation Authority.--
          (1) In general.--The President is authorized to 
        proclaim, as a part of the HTS--
                  (A) the provisions set out in Appendix 6.A of 
                Annex 300-B, Annex 401, Annex 403.1 Annex 
                403.2, and Annex 403.3, of the Agreement, and
                  (B) any additional subordinate category 
                necessary to carry out this title consistent 
                with the Agreement.
          (2) Modifications.--Subject to the consultation and 
        layover requirements of section 103, the President may 
        proclaim--
                  (A) modifications to the provisions 
                proclaimed under the authority of paragraph 
                (1)(A), other than the provisions of paragraph 
                A of Appendix 6 of Annex 300-B and section XI 
                of part B of Annex 401 of the Agreement; and
                  (B) a modified version of the definition of 
                any term set out in subsection (p) (and such 
                modified version of the definition shall 
                supersede the version in subsection (p)), but 
                only if the modified version reflects solely 
                those modifications to the same term in article 
                415 of the Agreement that are agreed to by the 
                NAFTA countries before the 1st anniversary of 
                the date of the enactment of this Act.
          (3) Special rules for textiles.--Notwithstanding the 
        provisions of paragraph (2)(A), and subject to the 
        consultation and layover requirements of section 103, 
        the President may proclaim--
                  (A) modifications to the provisions 
                proclaimed under the authority of paragraph 
                (1)(A) as are necessary to implement an 
                agreement with one or more of the NAFTA 
                countries pursuant to paragraph 2 of section 7 
                of Annex 300-B of the Agreement, and
                  (B) before the 1st anniversary of the date of 
                the enactment of this Act, modifications to 
                correct any typographical, clerical, or other 
                nonsubstantive technical error regarding the 
                provisions of Appendix 6.A of Annex 300-B and 
                section XI of part B of Annex 401 of the 
                Agreement.

SEC. 203. DRAWBACK.

    (a) Definition of a Good Subject to NAFTA Drawback.--For 
purposes of this Act and the amendments made by subsection (b), 
the term ``good subject to NAFTA drawback'' means any imported 
good other than the following:
          (1) A good entered under bond for transportation and 
        exportation to a NAFTA country.
          (2) A good exported to a NAFTA country in the same 
        condition as when imported into the United States. For 
        purposes of this paragraph--
                  (A) processes such as testing, cleaning, 
                repacking, or inspecting a good, or preserving 
                it in its same condition, shall not be 
                considered to change the condition of the good, 
                and
                  (B) except for a good referred to in 
                paragraph 12 of section A of Annex 703.2 of the 
                Agreement that is exported to Mexico, if a good 
                described in the first sentence of this 
                paragraph is commingled with fungible goods and 
                exported in the same condition, the origin of 
                the good may be determined on the basis of the 
                inventory methods provided for in the 
                regulations implementing this title.
          (3) A good--
                  (A) that is--
                          (i) deemed to be exported from the 
                        United States,
                          (ii) used as a material in the 
                        production of another good that is 
                        deemed to be exported to a NAFTA 
                        country, or
                          (iii) substituted for by a good of 
                        the same kind and quality that is used 
                        as a material in the production of 
                        another good that is deemed to be 
                        exported to a NAFTA country, and
                  (B) that is delivered--
                          (i) to a duty-free shop,
                          (ii) for ship's stores or supplies 
                        for ships or aircraft, or
                          (iii) for use in a project undertaken 
                        jointly by the United States and a 
                        NAFTA country and destined to become 
                        the property of the United States.
          (4) A good exported to a NAFTA country for which a 
        refund of customs duties is granted by reason of--
                  (A) the failure of the good to conform to 
                sample or specification, or
                  (B) the shipment of the good without the 
                consent of the consignee.
          (5) A good that qualifies under the rules of origin 
        set out in section 202 that is--
                  (A) exported to a NAFTA country,
                  (B) used as a material in the production of 
                another good that is exported to a NAFTA 
                country, or
                  (C) substituted for by a good of the same 
                kind and quality that is used as a material in 
                the production of another good that is exported 
                to a NAFTA country.
          (6) A good provided for in subheading 1701.11.02 of 
        the HTS that is--
                  (A) used as a material, or
                  (B) substituted for by a good of the same 
                kind and quality that is used as a material,
        in the production of a good provided for in existing 
        Canadian tariff item 1701.99.00 or existing Mexican 
        tariff item 1701.99.01 or 1701.99.99 (relating to 
        refined sugar).
          (7) A citrus product that is exported to Canada.
          (8) A good used as a material, or substituted for by 
        a good of the same kind and quality that is used as a 
        material, in the production of--
                  (A) apparel, or
                  (B) a good provided for in subheading 
                6307.90.99 (insofar as it relates to furniture 
                moving pads), 5811.00.20, or 5811.00.30 of the 
                HTS,
        that is exported to Canada and that is subject to 
        Canada's most-favored-nation rate of duty upon 
        importation into Canada.
Wherein paragraph (6) a good referred to by an item is 
described in parentheses following the item, the description is 
provided for purposes of reference only.
    [(b) Consequential Amendments With Delayed Effect.--
Amendments to sections 311-313 of the Tariff Act of 1930, 
section 562 of the Tariff Act of 1930, and section 3(a) of the 
Foreign Trade Zones Act.
    [(c) Consequential Amendment With Immediate Effect.--
Amendment to section 313(j) of the Tariff Act of 1930.]
    (d) Elimination of Drawback for Section 22 Fees.--
Notwithstanding any other provision of law, the Secretary of 
the Treasury may not, on condition of export, refund or reduce 
a fee applied pursuant to section 22 of the Agricultural 
Adjustment Act (7 U.S.C. 624) with respect to goods included 
under subsection (a) that are exported to--
          (1) Canada after December 31, 1995, for so long as it 
        is a NAFTA country; or
          (2) Mexico after December 31, 2000, for so long as it 
        is a NAFTA country.
    (e) Inapplicability to Countervailing and Antidumping 
Duties.--Nothing in this section or the amendments made by it 
shall be considered to authorize the refund, waiver, or 
reduction of countervailing duties or antidumping duties 
imposed on an imported good.

[SEC. 204. CUSTOMS USER FEES.

    Amendment to section 13031(b)(10) of the Consolidated 
Budget Reconciliation Act of 1985 (reprinted elsewhere).]

[SEC. 205. ENFORCEMENT.

    Amendments to sections 508, 509, and 592 of the Tariff Act 
of 1930 (reprinted elsewhere).]

[SEC. 206. RELIQUIDATION OF ENTRIES FOR NAFTA-ORIGIN GOODS.

    Amendment to section 520 of the Tariff Act of 1930.]

[SEC. 207. COUNTRY OF ORIGIN MARKING OF NAFTA GOODS.

    Amendments to section 304 of the Tariff Act of 1930 
(reprinted elsewhere).]

[SEC. 208. PROTESTS AGAINST ADVERSE ORIGIN DETERMINATIONS.

    Amendments to section 514 of the Tariff Act of 1930 
(reprinted elsewhere).]

[SEC. 209. EXCHANGE OF INFORMATION.

    Amendment to section 628 of the Tariff Act of 1930.]

SEC. 210. PROHIBITION ON DRAWBACK FOR TELEVISION PICTURE TUBES.

    Notwithstanding any other provision of law, no customs 
duties may be refunded, waived, or reduced on color cathode-ray 
television picture tubes, including video monitor cathode-ray 
tubes (provided for in subheading 8540.11.00 of the HTS), that 
are nonoriginating goods under section 202(p)(19) and are--
          (A) exported to a NAFTA country;
          (B) used as a material in the production of other 
        goods that are exported to a NAFTA country; or
          (C) substituted for by goods of the same kind and 
        quality used as a material in the production of other 
        goods that are exported to a NAFTA country.

SEC. 211. MONITORING OF TELEVISION AND PICTURE TUBE IMPORTS.

    (a) Monitoring.--Beginning on the date the Agreement enters 
into force with respect to the United States, the United States 
Customs Service shall, for a period of 5 years, monitor imports 
into the United States of articles described in subheading 
8528.10 of the HTS from NAFTA countries and shall take action 
to exercise all rights of the United States under chapter 5 of 
the Agreement with respect to such imports. The United States 
Customs Service shall take appropriate action under chapter 5 
of the Agreement with respect to such imports, including 
verifications to ensure that the rules of origin under the 
Agreement are fully complied with and that the duty drawback 
obligations contained in article 303 and Annex 303.8 of the 
Agreement are fully implemented and duties are correctly 
assessed.
    (b) Report to Trade Representative.--The United States 
Customs Service shall make the results of the monitoring and 
verification required by subsection (a) available to the 
President and the Trade Representative. If, based on such 
information, the President has reason to believe that articles 
described in subheading 8540.11 of the HTS, intended for 
ultimate consumption in the United States, are entering the 
territory of a NAFTA country inconsistent with the provisions 
of the Agreement, or have been undervalued in a manner that may 
raise concerns under United States trade laws, the President 
shall promptly take such action as may be appropriate under all 
relevant provisions of the Agreement, including article 317 and 
chapter 20, and under applicable United States trade statutes.

SEC. 212. TITLE VI AMENDMENTS.

    Any amendment in this title to a law that is also amended 
under title VI shall be made after the title VI amendment is 
executed.

[SEC. 213. EFFECTIVE DATES.]

      TITLE III--APPLICATION OF AGREEMENT TO SECTORS AND SERVICES

                         Subtitle A--Safeguards

       PART 1--RELIEF FROM IMPORTS BENEFITING FROM THE AGREEMENT

SEC. 301. DEFINITIONS.

    As used in this part:
          (1) Canadian article.--The term ``Canadian article'' 
        means an article that--
                  (A) is an originating good under chapter 4 of 
                the Agreement; and
                  (B) qualifies under the Agreement to be 
                marked as a good of Canada.
          (2) Mexican article.--The term ``Mexican article'' 
        means an article that--
                  (A) is an originating good under chapter 4 of 
                the Agreement; and
                  (B) qualifies under the Agreement to be 
                marked as a good of Mexico.

SEC. 302. COMMENCING OF ACTION FOR RELIEF.

    (a) Filing of Petition.--
          (1) In general.--A petition requesting action under 
        this part for the purpose of adjusting to the 
        obligations of the United States under the Agreement 
        may be filed with the International Trade Commission by 
        an entity, including a trade association, firm, 
        certified or recognized union, or group of workers, 
        that is representative of an industry. The 
        International Trade Commission shall transmit a copy of 
        any petition filed under this subsection to the Trade 
        Representative.
          (2) Provisional relief.--An entity filing a petition 
        under this section may request that provisional relief 
        be provided as if the petition had been filed under 
        section 202(a) of the Trade Act of 1974.
          (3) Critical circumstances.--An allegation that 
        critical circumstances exist must be included in the 
        petition or made on or before the 90th day after the 
        date on which the investigation is initiated under 
        subsection (b).
    (b) Investigation and Determination.--Upon the filing of a 
petition under subsection (a), the International Trade 
Commission, unless subsection (d) applies, shall promptly 
initiate an investigation to determine whether, as a result of 
the reduction or elimination of a duty provided for under the 
Agreement, a Canadian article or a Mexican article, as the case 
may be, is being imported into the United States in such 
increased quantities (in absolute terms) and under such 
conditions so that imports of the article, alone, constitute a 
substantial cause of--
          (1) serious injury; or
          (2) except in the case of a Canadian article, a 
        threat of serious injury;
to the domestic industry producing an article that is like, or 
directly competitive with, the imported article.
    (c) Applicable Provisions.--The provisions of--
          (1) paragraphs (1)(B), (3) (except subparagraph (A)), 
        and (4) of subsection (b);
          (2) subsection (c); and
          (3) subsection (d),
of section 202 of the Trade Act of 1974 (19 U.S.C. 2252) apply 
with respect to any investigation initiated under subsection 
(b).
    (d) Articles Exempt From Investigation.--No investigation 
may be initiated under this section with respect to--
          (1) any Canadian article or Mexican article if import 
        relief has been provided under this part with respect 
        to that article; or
          (2) any textile or apparel article set out in 
        Appendix 1.1 of Annex 300-B of the Agreement.

SEC. 303. INTERNATIONAL TRADE COMMISSION ACTION ON PETITION.

    (a) Determination.--By no later than 120 days after the 
date on which an investigation is initiated under section 
302(b) with respect to a petition, the International Trade 
Commission shall--
          (1) make the determination required under that 
        section; and
          (2) if the determination referred to in paragraph (1) 
        is affirmative and an allegation regarding critical 
        circumstances was made under section 302(a), make a 
        determination regarding that allegation.
    (b) Additional Finding and Recommendation if Determination 
Affirmative.--If the determination made by the International 
Trade Commission under subsection (a) with respect to imports 
of an article is affirmative, the International Trade 
Commission shall find, and recommend to the President in the 
report required under subsection (c), the amount of import 
relief that is necessary to remedy or, except in the case of 
imports of a Canadian article, prevent the injury found by the 
International Trade Commission in the determination. The import 
relief recommended by the International Trade Commission under 
this subsection shall be limited to that described in section 
304(c).
    (c) Report to President.--No later than the date that is 30 
days after the date on which a determination is made under 
subsection (a) with respect to an investigation, the 
International Trade Commission shall submit to the President a 
report that shall include--
          (1) a statement of the basis for the determination;
          (2) dissenting and separate views; and
          (3) any finding made under subsection (b) regarding 
        import relief.
    (d) Public Notice.--Upon submitting a report to the 
President under subsection (c), the International Trade 
Commission shall promptly make public such report (with the 
exception of information which the International Trade 
Commission determines to be confidential) and shall cause a 
summary thereof to be published in the Federal Register.
    (e) Applicable Provisions.--For purposes of this part, the 
provisions of paragraphs (1), (2), and (3) of section 330(d) of 
the Tariff Act of 1930 (19 U.S.C. 1330(d)) shall be applied 
with respect to determinations and findings made under this 
section as if such determinations and findings were made under 
section 202 of the Trade Act of 1974 (19 U.S.C. 2252).

SEC. 304. PROVISION OF RELIEF.

    (a) In General.--No later than the date that is 30 days 
after the date on which the President receives the report of 
the International Trade Commission containing an affirmative 
determination of the International Trade Commission under 
section 303(a), the President, subject to subsection (b), shall 
provide relief from imports of the article that is the subject 
of such determination to the extent that the President 
determines necessary to remedy or, except in the case of 
imports of a Canadian article, prevent the injury found by the 
International Trade Commission.
    (b) Exception.--The President is not required to provide 
import relief under this section if the President determines 
that the provision of the import relief will not provide 
greater economic and social benefits than costs.
    (c) Nature of Relief.--The import relief (including 
provisional relief) that the President is authorized to provide 
under this part is as follows:
          (1) In the case of imports of a Canadian article--
                  (A) the suspension of any further reduction 
                provided for under Annex 401.2 of the United 
                States-Canada Free Trade Agreement in the duty 
                imposed on such article;
                  (B) an increase in the rate of duty imposed 
                on such article to a level that does not exceed 
                the lesser of--
                          (i) the column 1 general rate of duty 
                        imposed under the HTS on like articles 
                        at the time the import relief is 
                        provided, or
                          (ii) the column 1 general rate of 
                        duty imposed on like articles on 
                        December 31, 1988; or
                  (C) in the case of a duty applied on a 
                seasonal basis to such article, an increase in 
                the rate of duty imposed on the article to a 
                level that does not exceed the column 1 general 
                rate of duty imposed on the article for the 
                corresponding season occurring immediately 
                before January 1, 1989.
          (2) In the case of imports of a Mexican article--
                  (A) the suspension of any further reduction 
                provided for under the United States Schedule 
                to Annex 302.2 of the Agreement in the duty 
                imposed on such article;
                  (B) an increase in the rate of duty imposed 
                on such article to a level that does not exceed 
                the lesser of--
                          (i) the column 1 general rate of duty 
                        imposed under the HTS on like articles 
                        at the time the import relief is 
                        provided, or
                          (ii) the column 1 general rate of 
                        duty imposed under the HTS on like 
                        articles on the day before the date on 
                        which the Agreement enters into force; 
                        or
                  (C) in the case of a duty applied on a 
                seasonal basis to such article, an increase in 
                the rate of duty imposed on the article to a 
                level that does not exceed the column 1 general 
                rate of duty imposed under the HTS on the 
                article for the corresponding season 
                immediately occurring before the date on which 
                the Agreement enters into force.
    (d) Period of Relief.--The import relief that the President 
is authorized to provide under this section may not exceed 3 
years, except that, if a Canadian article or Mexican article 
which is the subject of the action--
          (1) is provided for in an item for which the 
        transition period of tariff elimination set out in the 
        United States Schedule to Annex 302.2 of the Agreement 
        is greater than 10 years; and
          (2) the President determines that the affected 
        industry has undertaken adjustment and requires an 
        extension of the period of the import relief;
the President, after obtaining the advice of the International 
Trade Commission, may extend the period of the import relief 
for not more than 1 year, if the duty applied during the 
initial period of the relief is substantially reduced at the 
beginning of the extension period.
    (e) Rate on Mexican Articles After Termination of Import 
Relief.--When import relief under this part is terminated with 
respect to a Mexican article--
          (1) the rate of duty on that article after such 
        termination and on or before December 31 of the year in 
        which termination occurs shall be the rate that, 
        according to the United States Schedule to Annex 302.2 
        of the Agreement for the staged elimination of the 
        tariff, would have been in effect 1 year after the 
        initiation of the import relief action under section 
        302; and
          (2) the tariff treatment for that article after 
        December 31 of the year in which termination occurs 
        shall be, at the discretion of the President, either--
                  (A) the rate of duty conforming to the 
                applicable rate set out in the United States 
                Schedule to Annex 302.2; or
                  (B) the rate of duty resulting from the 
                elimination of the tariff in equal annual 
                stages ending on the date set out in the United 
                States Schedule to Annex 302.2 for the 
                elimination of the tariff.

SEC. 305. TERMINATION OF RELIEF AUTHORITY.

    (a) General Rule.--Except as provided in subsection (b), no 
import relief may be provided under this part--
          (1) in the case of a Canadian article, after December 
        31, 1998; or
          (2) in the case of a Mexican article, after the date 
        that is 10 years after the date on which the Agreement 
        enters into force;
unless the article against which the action is taken is an item 
for which the transition period for tariff elimination set out 
in the United States Schedule to Annex 302.2 of the Agreement 
is greater than 10 years, in which case the period during which 
relief may be granted shall be the period of staged tariff 
elimination for that article.
    (b) Exception.--Import relief may be provided under this 
part in the case of a Canadian article or Mexican article after 
the date on which such relief would, but for this subsection, 
terminate under subsection (a), but only if the Government of 
Canada or Mexico, as the case may be, consents to such 
provision.

SEC. 306. COMPENSATION AUTHORITY.

    For purposes of section 123 of the Trade Act of 1974 (19 
U.S.C. 2133), any import relief provided by the President under 
section 304 shall be treated as action taken under chapter 1 of 
title II of such Act.

SEC. 307. SUBMISSION OF PETITIONS.

    A petition for import relief may be submitted to the 
International Trade Commission under--
        (1) this part;
        (2) chapter 1 of title II of the Trade Act of 1974; or
        (3) under both this part and such chapter 1 at the same 
time, in which case the International Trade Commission shall 
consider such petitions jointly.

[SEC. 308. SPECIAL TARIFF PROVISIONS FOR CANADIAN FRESH FRUITS AND 
                    VEGETABLES.

    [Amendments to section 301(a) of the United States-Canada 
Free-Trade Implementation Act of 1988.]

SEC. 309. PRICE-BASED SNAPBACK FOR FROZEN CONCENTRATED ORANGE JUICE.

    (a) Trigger Price Determination.--
          (1) In general.--The Secretary shall determine--
                  (A) each period of 5 consecutive business 
                days in which the daily price for frozen 
                concentrated orange juice is less than the 
                trigger price; and
                  (B) for each period determined under 
                subparagraph (A), the first period occurring 
                thereafter of 5 consecutive business days in 
                which the daily price for frozen concentrated 
                orange juice is greater than the trigger price.
          (2) Notice of determinations.--The Secretary shall 
        immediately notify the Commissioner of Customs and 
        publish notice in the Federal Register of any 
        determination under paragraph (1), and the date of such 
        publication shall be the determination date for that 
        determination.
    (b) Imports of Mexican Articles.--Whenever after any 
determination date for a determination under subsection 
(a)(1)(A), the quantity of Mexican articles of frozen 
concentrated orange juice that is entered exceeds--
          (1) 264,978,000 liters (single strength equivalent) 
        in any of calendar years 1994 through 2002; or
          (2) 340,560,000 liters (single strength equivalent) 
        in any of calendar years 2003 through 2007;
the rate of duty on Mexican articles of frozen concentrated 
orange juice that are entered after the date on which the 
applicable limitation in paragraph (1) or (2) is reached and 
before the determination date for the related determination 
under subsection (a)(1)(B) shall be the rate of duty specified 
in subsection (c).
    (c) Rate of Duty.--The rate of duty specified for purposes 
of subsection (b) for articles entered on any day is the rate 
in the HTS that is the lower of--
          (1) the column 1 general rate of duty in effect for 
        such articles on July 1, 1991; or
          (2) the column 1 general rate of duty in effect on 
        that day.
    (d) Definitions.--For purposes of this section--
          (1) The term ``daily price'' means the daily closing 
        price of the New York Cotton Exchange, or any successor 
        as determined by the Secretary, for the closest month 
        in which contracts for frozen concentrated orange juice 
        are being traded on the Exchange.
          (2) The term ``business day'' means a day in which 
        contracts for frozen concentrated orange juice are 
        being traded on the New York Cotton Exchange, or any 
        successor as determined by the Secretary.
          (3) The term ``entered'' means entered or withdrawn 
        from warehouse for consumption, in the customs 
        territory of the United States.
          (4) The term ``frozen concentrated orange juice'' 
        means all products classifiable under subheading 
        2009.11.00 of the HTS.
          (5) The term ``Secretary'' means the Secretary of 
        Agriculture.
          (6) The term ``trigger price'' means the average 
        daily closing price of the New York Cotton Exchange, or 
        any successor as determined by the Secretary, for the 
        corresponding month during the previous 5-year period, 
        excluding the year with the highest average price for 
        the corresponding month and the year with the lowest 
        average price for the corresponding month.

             PART 2--RELIEF FROM IMPORTS FROM ALL COUNTRIES

SEC. 311. NAFTA ARTICLE IMPACT IN IMPORT RELIEF CASES UNDER THE TRADE 
                    ACT OF 1974.

    (a) In General.--If, in any investigation initiated under 
chapter 1 of title II of the Trade Act of 1974, the 
International Trade Commission makes an affirmative 
determination (or a determination which the President may treat 
as an affirmative determination under such chapter by reason of 
section 330(d) of the Tariff Act of 1930), the International 
Trade Commission shall also find (and report to the President 
at the time such injury determination is submitted to the 
President) whether--
          (1) imports of the article from a NAFTA country, 
        considered individually, account for a substantial 
        share of total imports; and
          (2) imports of the article from a NAFTA country, 
        considered individually or, in exceptional 
        circumstances, imports from NAFTA countries considered 
        collectively, contribute importantly to the serious 
        injury, or threat thereof, caused by imports.
    (b) Factors.--
          (1) Substantial import share.--In determining whether 
        imports from a NAFTA country, considered individually, 
        account for a substantial share of total imports, such 
        imports normally shall not be considered to account for 
        a substantial share of total imports if that country is 
        not among the top 5 suppliers of the article subject to 
        the investigation, measured in terms of import share 
        during the most recent 3-year period.
          (2) Application of ``contribute importantly'' 
        standard.--In determining whether imports from a NAFTA 
        country or countries contribute importantly to the 
        serious injury, or threat thereof, the International 
        Trade Commission shall consider such factors as the 
        change in the import share of the NAFTA country or 
        countries, and the level and change in the level of 
        imports of such country or countries. In applying the 
        preceding sentence, imports from a NAFTA country or 
        countries normally shall not be considered to 
        contribute importantly to serious injury, or the threat 
        thereof, if the growth rate of imports from such 
        country or countries during the period in which an 
        injurious increase in imports occurred is appreciably 
        lower than the growth rate of total imports from all 
        sources over the same period.
    (c) Definition.--For purposes of this section and section 
312(a), the term ``contribute importantly'' refers to an 
important cause, but not necessarily the most important cause.

SEC. 312. PRESIDENTIAL ACTION REGARDING NAFTA IMPORTS.

    (a) In General.--In determining whether to take action 
under chapter 1 of title II of the Trade Act of 1974 with 
respect to imports from a NAFTA country, the President shall 
determine whether--
          (1) imports from such country, considered 
        individually, account for a substantial share of total 
        imports; or
          (2) imports from a NAFTA country, considered 
        individually, or in exceptional circumstances imports 
        from NAFTA countries considered collectively, 
        contribute importantly to the serious injury, or threat 
        thereof, found by the International Trade Commission.
    (b) Exclusion of NAFTA Imports.--In determining the nature 
and extent of action to be taken under chapter 1 of title II of 
the Trade Act of 1974, the President shall exclude from such 
action imports from a NAFTA country if the President makes a 
negative determination under subsection (a) (1) or (2) with 
respect to imports from such country.
    (c) Action After Exclusion of NAFTA Country Imports.--
          (1) In general.--If the President, under subsection 
        (b), excludes imports from a NAFTA country or countries 
        from action under chapter 1 of title II of the Trade 
        Act of 1974 but thereafter determines that a surge in 
        imports from that country or countries is undermining 
        the effectiveness of the action--
                  (A) the President may take appropriate action 
                under such chapter 1 to include those imports 
                in the action; and
                  (B) any entity that is representative of an 
                industry for which such action is being taken 
                may request the International Trade Commission 
                to conduct an investigation of the surge in 
                such imports.
          (2) Investigation.--Upon receiving a request under 
        paragraph (1)(B), the International Trade Commission 
        shall conduct an investigation to determine whether a 
        surge in such imports undermines the effectiveness of 
        the action. The International Trade Commission shall 
        submit the findings of its investigation to the 
        President no later than 30 days after the request is 
        received by the International Trade Commission.
          (3) Definition.--For purposes of this subsection, the 
        term ``surge'' means a significant increase in imports 
        over the trend for a recent representative base period.
    (d) Condition Applicable to Quantitative Restrictions.--Any 
action taken under this section proclaiming a quantitative 
restriction shall permit the importation of a quantity or value 
of the article which is not less than the quantity or value of 
such article imported into the United States during the most 
recent period that is representative of imports of such 
article, with allowance for reasonable growth.

           *       *       *       *       *       *       *


                       PART 3--GENERAL PROVISIONS

[SEC. 315. PROVISIONAL RELIEF.

    [Amendments to section 202(d) of the Trade Act of 1974 
(reprinted elsewhere).]

SEC. 316. MONITORING.

    For purposes of expediting an investigation concerning 
provisional relief under this subtitle or section 202 of the 
Trade Act of 1974 regarding--
          (1) fresh or chilled tomatoes provided for in 
        subheading 0702.00.00 of the HTS; and
          (2) fresh or chilled peppers, other than chili 
        peppers provided for in subheading 0709.60.00 of the 
        HTS;
the International Trade Commission, until January 1, 2009, 
shall monitor imports of such goods as if proper requests for 
such monitoring had been made under subsection (d)(1)(C)(i) of 
such section 202. At the request of the International Trade 
Commission, the Secretary of Agriculture and the Commissioner 
of Customs shall provide to the International Trade Commission 
information relevant to the monitoring carried out under this 
section.

SEC. 317. PROCEDURES CONCERNING THE CONDUCT OF INTERNATIONAL TRADE 
                    COMMISSION INVESTIGATIONS.

    (a) Procedures and Rules.--The International Trade 
Commission shall adopt such procedures and rules and 
regulations as are necessary to bring its procedures into 
conformity with chapter 8 of the Agreement.
    [(b) Conforming Amendment.--Amendment to section 202(a) of 
the Trade Act of 1974 (reprinted elsewhere).]

[SEC. 318. EFFECTIVE DATE.]

                        Subtitle B--Agriculture

SEC. 321. AGRICULTURE.

    [(a) Meat Import Act of 1979.--Amendments to the Meat 
Import Act of 1979 which was repealed by section 403 of the 
Uruguay Round Agreements Act.]
    (b) Section 22 of the Agricultural Adjustment Act.--
          (1) In general.--The President may, pursuant to 
        article 309 and Annex 703.2 of the Agreement, exempt 
        from any quantitative limitation or fee imposed 
        pursuant to section 22 of the Agricultural Adjustment 
        Act (7 U.S.C. 624), reenacted with amendments by the 
        Agricultural Marketing Agreement Act of 1937, any 
        article which originates in Mexico, if Mexico is a 
        NAFTA country.
          (2) Qualification of articles.--The determination of 
        whether an article originates in Mexico shall be made 
        in accordance with section 202, except that operations 
        performed in, or materials obtained from, any country 
        other than the United States or Mexico shall be treated 
        as if performed in or obtained from a country other 
        than a NAFTA country.
    (c) Tariff Rate Quotas.--In implementing the tariff rate 
quotas set out in the United States Schedule to Annex 302.2 of 
the Agreement, the President shall take such action as may be 
necessary to ensure that imports of agricultural goods do not 
disrupt the orderly marketing of commodities in the United 
States.
    (d) Peanuts.--
          (1) Effect of the agreement.--
                  (A) In general.--Nothing in the Agreement or 
                this Act reduces or eliminates--
                          (i) any penalty required under 
                        section 358e(d) of the Agricultural 
                        Adjustment Act of 1938 (7 U.S.C. 
                        1359a(d)); or
                          (ii) any requirement under Marketing 
                        Agreement No. 146, Regulating the 
                        Quality of Domestically Produced 
                        Peanuts, on peanuts in the domestic 
                        market, pursuant to section 108B(f) of 
                        the Agricultural Act of 1949 (7 U.S.C. 
                        1445c-3(f)).
                  (B) Reentry of exported peanuts.--Paragraph 
                (6) of section 358e(d) of the Agricultural 
                Adjustment Act of 1938 (7 U.S.C. 1359a(d)(6)) 
                is amended to read as follows:
          ``(6) Reentry of exported peanuts.--
                  ``(A) Penalty.--If any additional peanuts 
                exported by a handler are reentered into the 
                United States in commercial quantities as 
                determined by the Secretary, the importer of 
                the peanuts shall be subject to a penalty at a 
                rate equal to 140 percent of the loan level for 
                quota peanuts on the quantity of peanuts 
                reentered.
                  ``(B) Records.--Each person, firm, or handler 
                who imports peanuts into the United States 
                shall maintain such records and documents as 
                are required by the Secretary to ensure 
                compliance with this subsection.''.
          (2) Consultations on imports.--It is the sense of 
        Congress that the United States should request 
        consultations in the Working Group on Emergency Action, 
        established in the Understanding Between the Parties to 
        the North American Free Trade Agreement Concerning 
        Chapter Eight--Emergency Action, if imports of peanuts 
        exceed the in-quota quantity under a tariff rate quota 
        set out in the United States Schedule to Annex 302.2 of 
        the Agreement concerning whether--
                  (A) the increased imports of peanuts 
                constitute a substantial cause of, or 
                contribute importantly to, serious injury, or 
                threat of serious injury, to the domestic 
                peanut industry; and
                  (B) recourse under Chapter Eight of the 
                Agreement or Article XIX of the General 
                Agreement on Tariffs and Trade is appropriate.
    (e) Fresh Fruits, Vegetables, and Cut Flowers.--
          (1) In general.--The Secretary of Agriculture shall 
        collect and compile the information specified under 
        paragraph (3), if reasonably available, from 
        appropriate Federal departments and agencies and the 
        relevant counterpart ministries of the Government of 
        Mexico.
          (2) Designation of an office.--The Secretary of 
        Agriculture shall designate an office within the United 
        States Department of Agriculture to be responsible for 
        maintaining and disseminating, in a timely manner, the 
        data accumulated for verifying citrus, fruit, 
        vegetable, and cut flower trade between the United 
        States and Mexico. The information shall be made 
        available to the public and the NAFTA Agriculture 
        Committee Working Groups.
          (3) Information collected.--The information to be 
        collected if reasonably available, includes--
                  (A) monthly fresh fruit, fresh vegetable, 
                fresh citrus, and processed citrus product 
                import and export data;
                  (B) monthly citrus juice production and 
                export data;
                  (C) data on inspections of shipments of 
                citrus, vegetables, and cut flowers entering 
                the United States from Mexico; and
                  (D) in the case of fruits, vegetables, and 
                cut flowers entering the United States from 
                Mexico, data regarding--
                          (i) planted and harvested acreage; 
                        and
                          (ii) wholesale prices, quality, and 
                        grades.
    (f) End Use Certificates.--
          (1) In general.--The Secretary of Agriculture 
        (referred to in this subsection as the ``Secretary'') 
        shall implement, in coordination with the Commissioner 
        of Customs, a program requiring that end-use 
        certificates be included in the documentation covering 
        the entry into, or the withdrawal from a warehouse for 
        consumption in, the customs territory of the United 
        States--
                  (A) of any wheat that is a product of any 
                foreign country or instrumentality that 
                requires, as of the effective date of this 
                subsection, end-use certificates for imports of 
                wheat that is a product of the United States 
                (referred to in this subsection as ``United 
                States-produced wheat''); and
                  (B) of any barley that is a product of any 
                foreign country or instrumentality that 
                requires, as of the effective date of this 
                subsection, end-use certificates for imports of 
                barley that is a product of the United States 
                (referred to in this subsection as ``United 
                States-produced barley'').
          (2) Regulations.--The Secretary shall prescribe by 
        regulation such requirements regarding the information 
        to be included in end-use certificates as may be 
        necessary and appropriate to carry out this subsection.
          (3) Producer protection determination.--At any time 
        after the effective date of the requirements 
        established under paragraph (1), the Secretary may, 
        subject to paragraph (5), suspend the requirements when 
        making a determination, after consultation with 
        domestic producers, that the program implemented under 
        this subsection has directly resulted in--
                  (A) the reduction of income to the United 
                States producers of agricultural commodities; 
                or
                  (B) the reduction of the competitiveness of 
                United States agricultural commodities in the 
                world export markets.
          (4) Suspension of requirements.--
                  (A) Wheat.--If a foreign country or 
                instrumentality that requires end-use 
                certificates for imports of United States-
                produced wheat as of the effective date of the 
                requirement under paragraph (1)(A) eliminates 
                the requirement, the Secretary shall suspend 
                the requirement under paragraph (1)(A) 
                beginning 30 calendar days after suspension by 
                the foreign country or instrumentality.
                  (B) Barley.--If a foreign country or 
                instrumentality that requires end-use 
                certificates for imports of United States-
                produced barley as of the effective date of the 
                requirement under paragraph (1)(B) eliminates 
                the requirement, the Secretary shall suspend 
                the requirement under paragraph (1)(B) 
                beginning 30 calendar days after suspension by 
                the foreign country or instrumentality.
          (5) Report to congress.--The Secretary shall not 
        suspend the requirements established under paragraph 
        (1) under circumstances identified in paragraph (3) 
        before the Secretary submits a report to Congress 
        detailing the determination made under paragraph (3) 
        and the reasons for making the determination.
          (6) Compliance.--It shall be a violation of section 
        1001 of title 18, United States Code, for a person to 
        engage in fraud or knowingly violate this subsection or 
        a regulation implementing this subsection.
          (7) Effective date.--This subsection shall become 
        effective on the date that is 120 days after the date 
        of enactment of this Act.
    (g) Agricultural Fellowship Program.--Section 1542(d) of 
the Food, Agriculture, Conservation, and Trade Act of 1990 
(Public Law 101-624; 7 U.S.C. 5622 note) is amended by adding 
at the end the following new paragraph:
          ``(3) Agricultural fellowships for nafta countries.--
                  ``(A) In general.--The Secretary shall grant 
                fellowships to individuals from countries that 
                are parties to the North American Free Trade 
                Agreement (referred to in this paragraph as 
                `NAFTA') to study agriculture in the United 
                States, and to individuals in the United States 
                to study agriculture in other NAFTA countries.
                  ``(B) Purpose.--The purpose of fellowships 
                granted under this paragraph is--
                          ``(i) to allow the recipients to 
                        expand their knowledge and 
                        understanding of agricultural systems 
                        and practices in other NAFTA countries;
                          ``(ii) to facilitate the improvement 
                        of agricultural systems in NAFTA 
                        countries; and
                          ``(iii) to establish and expand 
                        agricultural trade linkages between the 
                        United States and other NAFTA 
                        countries.
                  ``(C) Eligible recipients.--The Secretary may 
                provide fellowships under this paragraph to 
                agricultural producers and consultants, 
                government officials, and other individuals 
                from the private and public sectors.
                  ``(D) Acceptance of gifts.--The Secretary may 
                accept money, funds, property, and services of 
                every kind by gift, devise, bequest, grant, or 
                otherwise, and may in any manner, dispose of 
                all of the holdings and use the receipts 
                generated from the disposition to carry out 
                this paragraph. Receipts under this paragraph 
                shall remain available until expended.
                  ``(E) Authorization of appropriation.--There 
                are authorized to be appropriated such sums as 
                are necessary to carry out this paragraph.''.
    (h) Assistance for Affected Farmworkers.--
          (1) In general.--Subject to paragraph (3), if at any 
        time the Secretary of Agriculture determines that the 
        implementation of the Agreement has caused low-income 
        migrant or seasonal farmworkers to lose income, the 
        Secretary may make available grants, not to exceed 
        $20,000,000 for any fiscal year, to public agencies or 
        private organizations with tax-exempt status under 
        section 501(c)(3) of the Internal Revenue Code of 1986, 
        that have experience in providing emergency services to 
        low-income migrant or seasonal farmworkers. Emergency 
        services to be provided with assistance received under 
        this subsection may include such types of assistance as 
        the Secretary determines to be necessary and 
        appropriate.
          (2) Definition.--As used in this subsection, the term 
        ``low-income migrant or seasonal farmworkers'' shall 
        have the same meaning as provided in section 2281(b) of 
        the Food, Agriculture, Conservation, and Trade Act of 
        1990 (42 U.S.C. 5177a(b)).
          (3) Authorization of appropriations.--There are 
        authorized to be appropriated $20,000,000 for each 
        fiscal year to carry out this subsection.
    (i) Biennial Report on Effects of the Agreement on American 
Agriculture.--
          (1) In general.--The Secretary of Agriculture shall 
        prepare a biennial report on the effects of the 
        Agreement on United States producers of agricultural 
        commodities and on rural communities located in the 
        United States.
          (2) Contents of report.--The report required under 
        this subsection shall include--
                  (A) an assessment of the effects of 
                implementing the Agreement on the various 
                agricultural commodities affected by the 
                Agreement, on a commodity-by-commodity basis;
                  (B) an assessment of the effects of 
                implementing the Agreement on investments made 
                in United States agriculture and on rural 
                communities located in the United States;
                  (C) an assessment of the effects of 
                implementing the Agreement on employment in 
                United States agriculture, including any gains 
                or losses of jobs in businesses directly or 
                indirectly related to United States 
                agriculture; and
                  (D) such other information and data as the 
                Secretary determines appropriate.
          (3) Submission of report.--The Secretary shall 
        furnish the report required under this subsection to 
        the Committee on Agriculture, Nutrition, and Forestry 
        of the Senate and to the Committee on Agriculture of 
        the House of Representatives. The report shall be due 
        every 2 years and shall be submitted by March 1 of the 
        year in which the report is due. The first report shall 
        be due by March 1, 1997, and the final report shall be 
        due by March 1, 2011.

                   Subtitle C--Intellectual Property

SEC. 331. TREATMENT OF INVENTIVE ACTIVITY.

    [Amendment to section 104 of title 35, United States Code:

SECTION 104A. COPYRIGHT IN CERTAIN MOTION PICTURES

    (a) Restoration of Copyright.--Subject to subsections (b) 
and (c)--
          (1) any motion picture that is first fixed or 
        published in the territory of a NAFTA country as 
        defined in section 2(4) of the North American Free 
        Trade Agreement Implementation Act to which Annex 
        1705.7 of the North American Free Trade Agreement 
        applies, and
          (2) any work included in such motion picture that is 
        first fixed in or published with such motion picture,
that entered the public domain in the United States because it 
was first published on or after January 1, 1978, and before 
March 1, 1989, without the notice required by section 401, 402, 
or 403 of this title, the absence of which has not been excused 
by the operation of section 405 of this title, as such sections 
were in effect during that period, shall have copyright 
protection under this title for the remainder of the term of 
copyright protection to which it would have been entitled in 
the United States had it been published with such notice.
    (b) Effective Date of Protection.--The protection provided 
under subsection (a) shall become effective, with respect to 
any motion picture or work included in such motion picture 
meeting the criteria of that subsection, 1 year after the date 
on which the North American Free Trade Agreement enters into 
force with respect to, and the United States applies the 
Agreement to, the country in whose territory the motion picture 
was first fixed or published if, before the end of that 1-year 
period, the copyright owner in the motion picture or work files 
with the Copyright Office a statement of intent to have 
copyright protection restored under subsection (a). The 
Copyright Office shall publish in the Federal Register promptly 
after that effective date a list of motion pictures, and works 
included in such motion pictures, for which protection is 
provided under subsection (a).
    (c) Use of Previously Owned Copies.--A national or 
domiciliary of the United States who, before the date of the 
enactment of the North American Free Trade Agreement 
Implementation Act, made or acquired copies of a motion 
picture, or other work included in such motion picture, that is 
subject to protection under subsection (a), may sell or 
distribute such copies or continue to perform publicly such 
motion picture and other work without liability for such sale, 
distribution, or performance, for a period of 1 year after the 
date on which the list of motion pictures, and works included 
in such motion pictures, that are subject to protection under 
subsection (a) is published in the Federal Register under 
subsection (b).]

[SEC. 332. RENTAL RIGHTS IN SOUND RECORDINGS.

    [Amendment to section 4 of the Record Rental Amendment of 
1984.]

[SEC. 333. NONREGISTRABILITY OF MISLEADING GEOGRAPHIC INDICATIONS.

    [Amendments to the Trademark Act of 1946.]

SEC. 334. MOTION PICTURES IN THE PUBLIC DOMAIN.

    [Amendments to Chapter 1 of title 17, United States Code:

SECTION 104. INVENTION MADE ABROAD

    (a) In General.--In proceedings in the Patent and Trademark 
Office, in the courts, and before any other competent 
authority, an applicant for a patent, or a patentee, may not 
establish a date of invention by reference to knowledge or use 
thereof, or other activity with respect thereto, in a foreign 
country other than a NAFTA country, except as provided in 
sections 119 and 365 of this title. Where an invention was made 
by a person, civil or military, while domiciled in the United 
States or a NAFTA country and serving in any other country in 
connection with operations by or on behalf of the United States 
or a NAFTA country, the person shall be entitled to the same 
rights of priority in the United States with respect to such 
invention as if such invention had been made in the United 
States or a NAFTA country. To the extent that any information 
in a NAFTA country concerning knowledge, use, or other activity 
relevant to proving or disproving a date of invention has not 
been made available for use in a proceeding in the Office, a 
court, or any other competent authority to the same extent as 
such information could be made available in the United States, 
the Commissioner, court, or such other authority shall draw 
appropriate inferences, or take other action permitted by 
statute, rule, or regulation, in favor of the party that 
requested the information in the proceeding.
    (b) Definition.--As used in this section, the term ``NAFTA 
country'' has the meaning given that term in section 2(4) of 
the North American Free Trade Agreement Implementation Act.]

[SEC. 335. EFFECTIVE DATES.]

            Subtitle D--Temporary Entry of Business Persons

[SEC. 341. TEMPORARY ENTRY.

    [Provisions relating to, and amendments of, the Immigration 
and Nationality Act.]

[SEC. 342. EFFECTIVE DATE.]

                         Subtitle E--Standards

                     PART 1--STANDARDS AND MEASURES

[SEC. 351. STANDARDS AND SANITARY AND PHYTOSANITARY MEASURES.

    [Amendment adding Subtitle E to Title IV of the Trade 
Agreements Act of 1979.]

SEC. 352. TRANSPORTATION.

    No regulation issued by the Secretary of Transportation 
implementing a recommendation of the Land Transportation 
Standards Subcommittee established under article 913(5)(a)(i) 
of the Agreement may take effect before the date 90 days after 
the date of issuance.

                     PART 2--AGRICULTURAL STANDARDS

SEC. 361. AGRICULTURAL TECHNICAL AND CONFORMING AMENDMENTS.

    [Subsections (a)-(h) amendments to the Federal Seed Act; 
the Act of August 10, 1890; section 306 of the Tariff Act of 
1930; Honeybee Act; Poultry Products Inspection Act; Federal 
Meat Inspection Act; provisions on peanut butter and paste and 
an animal health biocontainment facility.]
    (i) Reports on Inspection of Imported Meat, Poultry, Other 
Foods, Animals, and Plants.--
          (1) Definitions.--As used in this subsection:
                  (A) Imports.--The term ``imports'' means any 
                meat, poultry, other food, animal, or plant 
                that is imported into the United States in 
                commercially significant quantities.
                  (B) Secretary.--The term ``Secretary'' means 
                the Secretary of Agriculture.
          (2) In general.--In consultation with representatives 
        of other appropriate agencies, the Secretary shall 
        prepare an annual report on the impact of the Agreement 
        on the inspection of imports.
          (3) Contents of reports.--the report required under 
        this subsection shall, to the maximum extent 
        practicable, include a description of--
                  (A) the quantity or, with respect to the 
                Customs Service, the number of shipments, of 
                imports from a NAFTA country that are inspected 
                at the borders of the United States with Canada 
                and Mexico during the prior year;
                  (B) any change in the level or types of 
                inspections of imports in each NAFTA country 
                during the prior year;
                  (C) in any case in which the Secretary has 
                determined that the inspection system of 
                another NAFTA country is equivalent to the 
                inspection system of the United States, the 
                reasons supporting the determination of the 
                Secretary;
                  (D) the incidence of violations of inspection 
                requirements by imports from NAFTA countries 
                during the prior year--
                          (i) at the borders of the United 
                        States with Mexico of Canada; or
                          (ii) at the last point of inspection 
                        in a NAFTA country prior to shipment to 
                        the United States if the agency accepts 
                        inspection in that country;
                  (E) the incidence of violations of inspection 
                requirements of imports to the United States 
                from Mexico or Canada prior to the 
                implementation of the Agreement;
                  (F) any additional cost associated with 
                maintaining an adequate inspection system of 
                imports as a result of the implementation of 
                the Agreement;
                  (G) any incidence of transshipment of 
                imports--
                          (i) that originate in a country other 
                        than a NAFTA country;
                          (ii) that are shipped to the United 
                        States through a NAFTA country during 
                        the prior year; and
                          (iii) that are incorrectly 
                        represented by the importer to qualify 
                        for preferential treatment under the 
                        Agreement;
                  (H) the quantity and results of any 
                monitoring by the United States of equivalent 
                inspection systems of imports in other NAFTA 
                countries during the prior year;
                  (I) the use by other NAFTA countries of 
                sanitary and phytosanitary measures (as defined 
                in the Agreement) to limit exports of United 
                States meat, poultry, other foods, animals, and 
                plants to the countries during the prior year; 
                and
                  (J) any other information the Secretary 
                determines to be appropriate.
          (4) Frequency of reports.--The Secretary shall 
        submit--
                  (A) the initial report required under this 
                subsection not later than January 31, 1995; and
                  (B) an annual report required under this 
                subsection not later than 1 year after the date 
                of the submission of the initial report and the 
                end of each 1-year period thereafter through 
                calendar year 2004.
          (5) Report to congress.--The Secretary shall prepare 
        and submit the report required under this subsection to 
        the Committee on Agriculture of the House of 
        Representatives and the Committee on Agriculture, 
        Nutrition, and Forestry of the Senate.

               Subtitle F--Corporate Average Fuel Economy

SEC. 371. CORPORATE AVERAGE FUEL ECONOMY.

    [Amends Section 503(b)(2) of the Motor Vehicle Information 
and Cost Savings Act (15 U.S.C. 2003(b)(2):
    (b)(1) In calculating average fuel economy under subsection 
(a)(1) of this section, the EPA Administrator shall separate 
the total number of passenger automobiles manufactured by a 
manufacturer into the following two categories:
          (A) Passenger automobiles which are domestically 
        manufactured by such manufacturer and passenger 
        automobiles which are included within this category 
        pursuant to paragraph (3) (plus, in the case of model 
        year 1978 and model year 1979, passenger automobiles 
        which are within the includable base import volume of 
        such manufacturer).
          (B) Passenger automobiles which are not domestically 
        manufactured by such manufacturer and which are not 
        included in the domestic category pursuant to paragraph 
        (3) (and which, in the case of model year 1978 and 
        model year 1979, are not within the includable base 
        import volume of such manufacturer).
The EPA Administrator shall calculate the average fuel economy 
of each such separate category, and each such category shall be 
treated as if manufactured by a separate manufacturer for 
purposes of this subchapter.
    (2) For purposes of this subsection:
          (A) The term ``includable base import volume'', with 
        respect to any manufacturer in model year 1978 or 1979, 
        as the case may be, is a number of passenger 
        automobiles which is the lesser of--
                  (i) the manufacturer's base import volume, or
                  (ii) the number of passenger automobiles 
                calculated by multiplying--
                          (I) the quotient obtained by dividing 
                        such manufacturer's base import volume 
                        by such manufacturer's base production 
                        volume, times
                          (II) the total number of passenger 
                        automobiles manufactured by such 
                        manufacturer during such model year.
          (B) The term ``base import volume'' means one-half 
        the sum of--
                  (i) the total number of passenger automobiles 
                which were not domestically manufactured by 
                such manufacturer during model year 1974 and 
                which were imported by such manufacturer during 
                such model year, plus
                  (ii) 133 percent of the total number of 
                passenger automobiles which were not 
                domestically manufactured by such manufacturer 
                during the first 9 months of model year 1975 
                and which were imported by such manufacturer 
                during such 9-month period.
          (C) The term ``base production volume'' means one-
        half the sum of--
                  (i) the total number of passenger automobiles 
                manufactured by such manufacturer during model 
                year 1974, plus
                  (ii) 133 percent of the total number of 
                passenger automobiles manufactured by such 
                manufacturer during the first 9 months of model 
                year 1975.
          (D) For purposes of subparagraphs (B) and (C) of this 
        paragraph any passenger automobile imported during 
        model year 1976, but prior to July 1, 1975, shall be 
        deemed to have been manufactured (and imported) during 
        the first 9 months of model year 1975.
          (E) Except as provided in subparagraph (G), an 
        automobile shall be considered domestically 
        manufactured in any model year if at least 75 percent 
        of the cost to the manufacturer of such automobile is 
        attributable to value added in the United States or 
        Canada, unless the assembly of such automobile is 
        completed in Canada and such automobile is not imported 
        into the United States prior to the expiration of 30 
        days following the end of such model year. The EPA 
        Administrator may prescribe rules for purposes of 
        carrying out this subparagraph and subparagraph (G).
          (F) The fuel economy of each passenger automobile 
        which is imported by a manufacturer in model year 1978 
        or any subsequent model year, as the case may be, and 
        which is not domestically manufactured by such 
        manufacturer, shall be deemed to be equal to the 
        average fuel economy of all such passenger automobiles.
          (G)(i) In accordance with the schedule set out in 
        clause (ii), an automobile shall be considered 
        domestically manufactured in a model year if at least 
        75 percent of the cost to the manufacturer of the 
        automobile is attributable to value added in the United 
        States, Canada, or Mexico, unless the assembly of the 
        automobile is completed in Canada or Mexico and the 
        automobile is not imported into the United States prior 
        to the expiration of 30 days following the end of that 
        model year.
          (ii) Clause (i) shall apply to all automobiles 
        manufactured by a manufacturer and sold in the United 
        States, wherever assembled, in accordance with the 
        following schedule:
                  (I) With respect to a manufacturer that 
                initiated the assembly of automobiles in Mexico 
                before model year 1992, the manufacturer may 
                elect, at any time between January 1, 1997, and 
                January 1, 2004, to have clause (i) apply to 
                all automobiles it manufacturers, beginning 
                with the model year commencing after the date 
                of such election.
                  (II) With respect to a manufacturer 
                initiating the assembly of automobiles in 
                Mexico after model year 1991, clause (i) shall 
                apply to all automobiles it manufactures, 
                beginning with the model year commencing after 
                January 1, 1994, or the model year commencing 
                after the date that the manufacturer initiates 
                the assembly of automobiles in Mexico, 
                whichever is later.
                  (III) With respect to a manufacturer not 
                described by subclause (I) or (II) assembling 
                automobiles in the United States or Canada but 
                not in Mexico, the manufacturer may elect, at 
                any time between January 1, 1997, and January 
                1, 2004, to have clause (i) apply to all 
                automobiles it manufactures, beginning with the 
                model year commencing after the date of such 
                election, except that if such manufacturer 
                initiates the assembly of automobiles in Mexico 
                before making such election, this subclause 
                shall not apply and the manufacturer shall be 
                subject to clause (II).
                  (IV) With respect to a manufacturer not 
                assembling automobiles in the United States, 
                Canada, or Mexico, clause (i) shall apply to 
                all automobiles it manufactures, beginning with 
                the model year commencing after January 1, 
                1994.
                  (V) With respect to a manufacturer authorized 
                to make an election under subclause (I) or 
                (III) which has not made that election within 
                the specified period, clause (i) shall apply to 
                all automobiles it manufactures, beginning with 
                the model year commencing after January 1, 
                2004.
          (iii) The Secretary shall prescribe reasonable 
        procedures for elections under this subparagraph, and 
        the EPA Administrator may prescribe rules for purposes 
        of carrying out this subparagraph.]

                   Subtitle G--Government Procurement

[SEC. 381. GOVERNMENT PROCUREMENT.

    [Amendments to Title III of the Trade Agreements Act of 
1979 (reprinted elsewhere) and to section 401 of the Rural 
Electrification Act of 1938.]

  TITLE IV--DISPUTE SETTLEMENT IN ANTIDUMPING AND COUNTERVAILING DUTY 
                                 CASES

 Subtitle A--Organizational, Administrative, and Procedural Provisions 
      Regarding the Implementation of Chapter 19 of the Agreement

SEC. 401. REFERENCES IN SUBTITLE.

    Any reference in this subtitle to an Annex, chapter, or 
article shall be considered to be a reference to the respective 
Annex, chapter, or article of the Agreement.

SEC. 402. ORGANIZATIONAL AND ADMINISTRATIVE PROVISIONS.

    (a) Criteria for Selection of Individuals To Serve on 
Panels and Committees.--
          (1) In general.--The selection of individuals under 
        this section for--
                  (A) placement on lists prepared by the 
                interagency group under subsection (c)(2)(B) 
                (i) and (ii);
                  (B) placement on preliminary candidate lists 
                under subsection (c)(3)(A);
                  (C) placement on final candidate lists under 
                subsection (c)(4)(A);
                  (D) placement by the Trade Representative on 
                the rosters described in paragraph 1 of Annex 
                1901.2 and paragraph 1 of Annex 1904.13; and
                  (E) appointment by the Trade Representative 
                for service on the panels and committees 
                convened under chapter 19;
        shall be made on the basis of the criteria provided in 
        paragraph 1 of Annex 1901.2 and paragraph 1 of Annex 
        1904.13 and shall be made without regard to political 
        affiliation.
          (2) Additional criteria for roster placements and 
        appointments under paragraph 1 of annex 1901.2.--
        Rosters described in paragraph 1 of Annex 1901.2 shall 
        include, to the fullest extent practicable, judges and 
        former judges who meet the criteria referred to in 
        paragraph (1). The Trade Representative shall, subject 
        to subsection (b), appoint judges to binational panels 
        convened under chapter 19, extraordinary challenge 
        committees convened under chapter 19, and special 
        committees established under article 1905, where such 
        judges offer and are available to serve and such 
        service is authorized by the chief judge of the court 
        on which they sit.
    (b) Selection of Certain Judges To Serve on Panels and 
Committees.--
          (1) Applicability.--This subsection applies only with 
        respect to the selection of individuals for binational 
        panels convened under chapter 19, extraordinary 
        challenge committees convened under chapter 19, and 
        special committees established under article 1905, who 
        are judges of courts created under article III of the 
        Constitution of the United States.
          (2) Consultation with chief judges.--The Trade 
        Representative shall consult, from time to time, with 
        the chief judges of the Federal judicial circuits 
        regarding the interest in, and availability for, 
        participation in binational panels, extraordinary 
        challenge committees, and special committees, of judges 
        within their respective circuits. If the chief judge of 
        a Federal judicial circuit determines that it is 
        appropriate for one or more judges within that circuit 
        to be included on a roster described in subsection 
        (a)(1)(D), the chief judge shall identify all such 
        judges for the Chief Justice of the United States who 
        may, upon his or her approval, submit the names of such 
        judges to the Trade Representative. The Trade 
        Representative shall include the names of such judges 
        on the roster.
          (3) Submission of lists to congress.--The Trade 
        Representative shall submit to the Committee on the 
        Judiciary and the Committee on Ways and Means of the 
        House of Representatives and to the Committee on 
        Finance and the Committee on the Judiciary of the 
        Senate a list of all judges included on a roster under 
        paragraph (2). Such list shall be submitted at the same 
        time as the final candidate lists are submitted under 
        subsection (c)(4)(A) and the final forms of amendments 
        are submitted under subsection (c)(4)(C)(iv).
          (4) Appointment of judges to panels or committees.--
        At such time as the Trade Representative proposes to 
        appoint a judge described in paragraph (1) to a 
        binational panel, an extraordinary challenge committee, 
        or a special committee, the Trade Representative shall 
        consult with that judge in order to ascertain whether 
        the judge is available for such appointment.
    (c) Selection of Other Candidates.--
          (1) Applicability.--This subsection applies only with 
        respect to the selection of individuals for binational 
        panels convened under chapter 19, extraordinary 
        challenge committees convened under chapter 19, and 
        special committees established under article 1905, 
        other than those individuals to whom subsection (b) 
        applies.
          (2) Interagency group.--
                  (A) Establishment.--There is established 
                within the interagency organization established 
                under section 242 of the Trade Expansion Act of 
                1962 (19 U.S.C. 1872) an interagency group 
                which shall--
                          (i) be chaired by the Trade 
                        Representative; and
                          (ii) consist of such officers (or the 
                        designees thereof) of the United States 
                        Government as the Trade Representative 
                        considers appropriate.
                  (B) Functions.--The interagency group 
                established under subparagraph (A) shall, in a 
                manner consistent with chapter 19--
                          (i) prepare by January 3 of each 
                        calendar year--
                                  (I) a list of individuals who 
                                are qualified to serve as 
                                members of binational panels 
                                convened under chapter 19; and
                                  (II) a list of individuals 
                                who are qualified to serve on 
                                extraordinary challenge 
                                committees convened under 
                                chapter 19 and special 
                                committees established under 
                                article 1905;
                          (ii) if the Trade Representative 
                        makes a request under paragraph 
                        (4)(C)(i) with respect to a final 
                        candidate list during any calendar 
                        year, prepare by July 1 of such 
                        calendar year a list of those 
                        individuals who are qualified to be 
                        added to that final candidate list;
                          (iii) exercise oversight of the 
                        administration of the United States 
                        Section that is authorized to be 
                        established under section 105; and
                          (iv) make recommendations to the 
                        Trade Representative regarding the 
                        convening of extraordinary challenge 
                        committees and special committees under 
                        chapter 19.
          (3) Preliminary candidate lists.--
                  (A) In general.--The Trade Representative 
                shall select individuals from the respective 
                lists prepared by the interagency group under 
                paragraph (2)(B)(i) for placement on--
                          (i) a preliminary candidate list of 
                        individuals eligible to serve as 
                        members of binational panels under 
                        Annex 1901.2; and
                          (ii) a preliminary candidate list of 
                        individuals eligible for selection as 
                        members of extraordinary challenge 
                        committees under Annex 1904.13 and 
                        special committees under article 1905.
                  (B) Submission of lists to congressional 
                committees.--
                          (i) In general.--No later than 
                        January 3 of each calendar year, the 
                        Trade Representative shall submit to 
                        the Committee on Finance of the Senate 
                        and the Committee on Ways and Means of 
                        the House of Representatives (hereafter 
                        in this section referred to as the 
                        ``appropriate Congressional 
                        Committees'') the preliminary candidate 
                        lists of those individuals selected by 
                        the Trade Representative under 
                        subparagraph (A) to be candidates 
                        eligible to serve on panels or 
                        committees convened pursuant to chapter 
                        19 during the 1-year period beginning 
                        on April 1 of such calendar year.
                          (ii) Additional information.--At the 
                        time the candidate lists are submitted 
                        under clause (i), the Trade 
                        Representative shall submit for each 
                        individual on the list a statement of 
                        professional qualifications.
                  (C) Consultation.--Upon submission of the 
                preliminary candidate lists under subparagraph 
                (B) to the appropriate Congressional 
                Committees, the Trade Representative shall 
                consult with such Committees with regard to the 
                individuals included on the preliminary 
                candidate lists.
                  (D) Revision of lists.--The Trade 
                Representative may add and delete individuals 
                from the preliminary candidate lists submitted 
                under subparagraph (B) after consultation with 
                the appropriate Congressional Committees 
                regarding the additions and deletions. The 
                Trade Representative shall provide to the 
                appropriate Congressional Committees written 
                notice of any addition or deletion of an 
                individual from the preliminary candidate 
                lists, along with the information described in 
                subparagraph (B)(ii) with respect to any 
                proposed addition.
          (4) Final candidate lists.--
                  (A) Submission of lists to congressional 
                committees.--No later than March 31 of each 
                calendar year, the Trade Representative shall 
                submit to the appropriate Congressional 
                Committees the final candidate lists of those 
                individuals selected by the Trade 
                Representative to be candidates eligible to 
                serve on panels and committees convened under 
                chapter 19 during the 1-year period beginning 
                on April 1 of such calendar year. An individual 
                may be included on a final candidate list only 
                if such individual was included in the 
                preliminary candidate list or if written notice 
                of the addition of such individual to the 
                preliminary candidate list was submitted to the 
                appropriate Congressional Committees at least 
                15 days before the date on which that final 
                candidate list is submitted to such Committees 
                under this subparagraph.
                  (B) Finality of lists.--Except as provided in 
                subparagraph (C), no additions may be made to 
                the final candidate lists after the final 
                candidate lists are submitted to the 
                appropriate Congressional Committees under 
                subparagraph (A).
                  (C) Amendment of lists.--
                          (i) In general.--If, after the Trade 
                        Representative has submitted the final 
                        candidate lists to the appropriate 
                        Congressional Committees under 
                        subparagraph (A) for a calendar year 
                        and before July 1 of such calendar 
                        year, the Trade Representative 
                        determines that additional individuals 
                        need to be added to a final candidate 
                        list, the Trade Representative shall--
                                  (I) request the interagency 
                                group established under 
                                paragraph (2)(A) to prepare a 
                                list of individuals who are 
                                qualified to be added to such 
                                candidate list;
                                  (II) select individuals from 
                                the list prepared by the 
                                interagency group under 
                                paragraph (2)(B)(ii) to be 
                                included in a proposed 
                                amendment to such final 
                                candidate list; and
                                  (III) by no later than July 1 
                                of such calendar year, submit 
                                to the appropriate 
                                Congressional Committees the 
                                proposed amendments to such 
                                final candidate list developed 
                                by the Trade Representative 
                                under subclause (II), along 
                                with the information described 
                                in paragraph (3)(B)(ii).
                          (ii) Consultation with congressional 
                        committees.--Upon submission of a 
                        proposed amendment under clause 
                        (i)(III) to the appropriate 
                        Congressional Committees, the Trade 
                        Representative shall consult with the 
                        appropriate Congressional Committees 
                        with regard to the individuals included 
                        in the proposed amendment.
                          (iii) Adjustment of proposed 
                        amendment.--The Trade Representatives 
                        may add and delete individuals from any 
                        proposed amendment submitted under 
                        clause (i)(III) after consulting with 
                        the appropriate Congressional 
                        Committees with regard to the additions 
                        and deletions. The Trade Representative 
                        shall provide to the appropriate 
                        Congressional Committees written notice 
                        of any addition or deletion of an 
                        individual from the proposed amendment.
                          (iv) Final amendment.--
                                  (I) In general.--If the Trade 
                                Representative submits under 
                                clause (i)(III) in any calendar 
                                year a proposed amendment to a 
                                final candidate list, the Trade 
                                Representative shall, no later 
                                than September 30 of such 
                                calendar year, submit to the 
                                appropriate Congressional 
                                Committees the final form of 
                                such amendment. On October 1 of 
                                such calendar year, such 
                                amendment shall take effect 
                                and, subject to subclause (II), 
                                the individuals included in the 
                                final form of such amendment 
                                shall be added to the final 
                                candidate list.
                                  (II) Inclusion of 
                                individuals.--An individual may 
                                be included in the final form 
                                of an amendment submitted under 
                                subclause (I) only if such 
                                individual was included in the 
                                proposed form of such amendment 
                                or if written notice of the 
                                addition of such individual to 
                                the proposed form of such 
                                amendment was submitted to the 
                                appropriate Congressional 
                                Committees at least 15 days 
                                before the date on which the 
                                final form of such amendment is 
                                submitted to such Committees 
                                under subclause (I).
                                  (III) Eligibility for 
                                service.--Individuals added to 
                                a final candidate list under 
                                subclause (I) shall be eligible 
                                to serve on panels or 
                                committees convened under 
                                chapter 19 during the 6-month 
                                period beginning on October 1 
                                of the calendar year in which 
                                such addition occurs.
                                  (IV) Finality of amendment.--
                                No additions may be made to the 
                                final form of an amendment 
                                described in subclause (I) 
                                after the final form of such 
                                amendment is submitted to the 
                                appropriate Congressional 
                                Committees under subclause (I).
          (5) Treatment of responses.--For purposes of applying 
        section 1001 of title 18, United States Code, the 
        written or oral responses of individuals to inquiries 
        of the interagency group established under paragraph 
        (2)(A) or of the Trade Representative regarding their 
        personal and professional qualifications, and financial 
        and other relevant interests, that bear on their 
        suitability for the placements and appointments 
        described in subsection (a)(1), shall be treated as 
        matters within the jurisdiction of an agency of the 
        United States.
    (d) Selection and Appointment.--
          (1) Authority of trade representative.--The Trade 
        Representative is the only officer of the United States 
        Government authorized to act on behalf of the United 
        States Government in making any selection or 
        appointment of an individual to--
                  (A) the rosters described in paragraph 1 of 
                Annex 1901.2 and paragraph 1 of Annex 1904.13; 
                or
                  (B) the panels or committees convened under 
                chapter 19;
        That is to be made solely or jointly by the United 
        States Government under the terms of the Agreement.
          (2) Restrictions on selection and appointment.--
        Except as provided in paragraph (3)--
                  (A) the Trade Representative may--
                          (i) select an individual for 
                        placement on the rosters described in 
                        paragraph 1 of Annex 1901.2 and 
                        paragraph 1 of Annex 1904.13 during the 
                        1-year period beginning on April 1 of 
                        any calendar year;
                          (ii) appoint an individual to serve 
                        as one of those members of any panel or 
                        committee convened under chapter 19 
                        during such 1-year period who, under 
                        the terms of the Agreement, are to be 
                        appointed solely by the United States 
                        Government; or
                          (iii) act to make a joint appointment 
                        with the Government of a NAFTA country, 
                        under the terms of the Agreement, of 
                        any individual who is a citizen or 
                        national of the United States to serve 
                        as any other member of such a panel or 
                        committee;
                only if such individual is on the appropriate 
                final candidate list that was submitted to the 
                appropriate Congressional Committees under 
                subsection (c)(4)(A) during such calendar year 
                or on such list as it may be amended under 
                subsection (c)(4)(C)(iv)(I), or on the list 
                submitted under subsection (b)(3) to the 
                Congressional Committees referred to in such 
                subsection; and
                  (B) no individual may--
                          (i) be selected by the United States 
                        Government for placement on the rosters 
                        described in paragraph 1 of Annex 
                        1901.2 and paragraph 1 of Annex 
                        1904.13; or
                          (ii) be appointed solely or jointly 
                        by the United States Government to 
                        serve as a member as a member of a 
                        panel or committee convened under 
                        chapter 19;
                during the 1-year period beginning on April 1 
                of any calendar year for which the Trade 
                Representative has not met the requirements of 
                subsection (a), and subsection (b) or (c) (as 
                the case may be).
          (3) Exceptions.--Notwithstanding subsection (c)(3) 
        (other than subparagraph (B)), subsection (c)(4), or 
        paragraph (2)(A) of this subsection, individuals 
        included on the preliminary candidate lists submitted 
        to the appropriate Congressional Committees under 
        subsection (c)(3)(B) may--
                  (A) be selected by the Trade Representative 
                for placement on the rosters described in 
                paragraph 1 of Annex 1901.2 and paragraph 1 of 
                Annex 1904.13 during the 3-month period 
                beginning on the date on which the Agreement 
                enters into force with respect to the United 
                States; and
                  (B) be appointed solely or jointly by the 
                Trade Representative under the terms of the 
                Agreement to serve as members of panels or 
                committees that are convened under chapter 19 
                during such 3-month period.
    (e) Transition.--If the Agreement enters into force between 
the United States and NAFTA country after January 3, 1994, the 
provisions of subsection (c) shall be applied with respect to 
the calendar year in which such entering into force occurs--
          (1) by substituting ``the date that is 30 days after 
        the date on which the Agreement enters into force with 
        respect to the United States'' for ``January 3 of each 
        calendar year'' in subsections (c)(2)(B(i) and 
        (c)(3)(B)(i); and
          (2) by substituting ``the date that is 3 months after 
        the date on which the Agreement enters into force with 
        respect to the United States'' for ``March 31 of each 
        calendar year'' in subsection (c)(4)(A).
    (f) Immunity.--With the exception of acts described in 
section 777(f)(3) of the Tariff Act of 1930 (19 U.S.C. 
1677f(f)(3)), individuals serving on panels or committees 
convened pursuant to chapter 19, and individuals designated to 
assist the individuals serving on such panels or committees, 
shall be immune from suit and legal process relating to acts 
performed by such individuals in their official capacity and 
within the scope of their functions as such panelists or 
committee members or assistants to such panelists or committee 
members.
    (g) Regulations.--The administering authority under title 
VII of the Tariff Act of 1930, the International Trade 
Commission, and the Trade Representative may promulgate such 
regulations as are necessary or appropriate to carry out 
actions in order to implement their respective responsibilities 
under chapter 19. Initial regulations to carry out such 
functions shall be issued before the date on which the 
Agreement enters into force with respect to the United States.
    (h) Report to Congress.--At such time as the final 
candidate lists are submitted under subsection (c)(4)(A) and 
the final forms of amendments are submitted under subsection 
(c)(4)(C)(iv), the Trade Representative shall submit to the 
Committee on the Judiciary and the Committee on Ways and Means 
of the House of Representatives, and to the Committee on 
Finance and the Committee on the Judiciary of the Senate, a 
report regarding the efforts made to secure the participation 
of judges and former judges on binational panels, extraordinary 
challenge committees, and special committees established under 
chapter 19.

SEC. 403. TESTIMONY AND PRODUCTION OF PAPERS IN EXTRAORDINARY 
                    CHALLENGES.

    (a) Authority of Extraordinary Challenge Committee To 
Obtain Information.--If an extraordinary challenge committee 
(hereafter in this section referred to as the ``committee'') is 
convened under paragraph 13 of article 1904, and the 
allegations before the committee include a matter referred to 
in paragraph 13(a)(i) of article 1904, for the purposes of 
carrying out its functions and duties under Annex 1904.13, the 
committee--
          (1) shall have access to, and the right to copy, any 
        document, paper, or record pertinent to the subject 
        matter under consideration, in the possession of any 
        individual, partnership, corporation, association, 
        organization, or other entity;
          (2) may summon witnesses, take testimony, and 
        administer oaths;
          (3) may require any individual, partnership, 
        corporation, association, organization, or other entity 
        to produce documents, books, or records relating to the 
        matter in question; and
          (4) may require any individual, partnership, 
        corporation, association, organization, or other entity 
        to furnish in writing, in such detail and in such form 
        as the committee may prescribe, information in its 
        possession pertaining to the matter.
Any member of the committee may sign subpoenas, and members of 
the committee, when authorized by the committee, may administer 
oaths and affirmation, examine witnesses, take testimony, and 
receive evidence.
    (b) Witnesses and Evidence.--The attendance of witnesses 
who are authorized to be summoned, and the production of 
documentary evidence authorized to be ordered, under subsection 
(a) may be required from any place in the United States at any 
designated place of hearing. In the case of disobedience to a 
subpoena authorized under subsection (a), the committee may 
request the Attorney General of the United States to invoke the 
aid of any district or territorial court of the United States 
in requiring the attendance and testimony of witnesses and the 
production of documentary evidence. Such court, within the 
jurisdiction of which such inquiry is carried on, may, in case 
of contumacy or refusal to obey a subpoena issued to any 
individual, partnership, corporation, association, 
organization, or other entity, issue an order requiring such 
individual or entity to appear before the committee, or to 
produce documentary evidence if so ordered or to give evidence 
concerning the matter in question. Any failure to obey such 
order of the court may be punished by such court as a contempt 
thereof.
    (c) Mandamus.--Any court referred to in subsection (b) 
shall have jurisdiction to issue writs of mandamus commanding 
compliance with the provisions of this section or any order of 
the committee made in pursuance thereof.
    (d) Depositions.--The committee may order testimony to be 
taken by deposition at any stage of the committee review. Such 
deposition may be taken before any person designated by the 
committee and having power to administer oaths. Such testimony 
shall be reduced to writing by the person taking the 
deposition, or under the direction of such person, and shall 
then be subscribed by the deponent. Any individual, 
partnership, corporation, association, organization, or other 
entity may be compelled to appear and be deposed and to produce 
documentary evidence in the same manner as witnesses may be 
compelled to appear and testify and produce documentary 
evidence before the committee, as provided in this section.

SEC. 404. REQUESTS FOR REVIEW OF DETERMINATION BY COMPETENT 
                    INVESTIGATING AUTHORITIES OF NAFTA COUNTRIES.

    (a) Definitions.--As used in this section:
          (1) Competent investigating authority.--The term 
        ``competent investigating authority'' means the 
        competent investigating authority; as defined in 
        article 1911, of a NAFTA country.
          (2) United states secretary.--The term ``United 
        States Secretary'' means that officer of the United 
        States referred to in article 1908.
    (b) Requests for Review by the United States.--In the case 
of a final determination of a competent investigating 
authority, requests by the United States for binational panel 
review of such determination under article 1904 shall be made 
by the United States Secretary.
    (c) Requests for Review by a Person.--In the case of a 
final determination of a competent investigating authority, a 
person, within the meaning of paragraph 5 of article 1904, may 
request a binational panel review of such determination by 
filing such a request with the United States Secretary within 
the time limit provided for in paragraph 4 of article 1904. The 
receipt of such request by the United States Secretary shall be 
deemed to be a request for binational panel review within the 
meaning of article 1904. The request for such panel review 
shall be without prejudice to any challenge before a binational 
panel of the basis for a particular request for review.
    (d) Service of Request for Review.--Whenever binational 
panel review of a final determination made by a competent 
investigating authority is requested under this section, the 
United States Secretary shall serve a copy of the request on 
all persons who would otherwise be entitled under the law of 
the importing country to commence proceedings for judicial 
review of the determination.

SEC. 405. RULES OF PROCEDURE FOR PANELS AND COMMITTEES.

    (a) Rules of Procedure and Binational Panels.--The 
administering authority shall prescribe rules, negotiated in 
accordance with paragraph 14 of article 1904, governing, with 
respect to binational panel reviews--
          (1) requests for such review, complaints, other 
        pleadings, and other papers;
          (2) the amendment, filing, and service of such 
        pleadings and papers;
          (3) the joinder, suspension, and termination of such 
        reviews; and
          (4) other appropriate procedural matters.
    (b) Rules of Procedure for Extraordinary Challenge 
Committees.--The administering authority shall prescribe rules, 
negotiated in accordance with paragraph 2 of Annex 1904.13, 
governing the procedures for reviews by extraordinary challenge 
committees.
    (c) Rules of Procedure for Safeguarding the Panel Review 
System.--The administering authority shall prescribe rules, 
negotiated in accordance with Annex 1905.6, governing the 
procedures for special committees described in such Annex.
    (d) Publication of Rules.--The rules prescribed under 
subsections (a), (b), and (c) shall be published in the Federal 
Register.
    (e) Administering Authority.--As used in this section, the 
term ``administering authority'' has the meaning given such 
term in section 771(1) of the Tariff Act of 1930 (19 U.S.C. 
1677(1)).

SEC. 406. SUBSIDY NEGOTIATIONS.

    In the case of any trade agreement which may be entered 
into by the President with a NAFTA country, the negotiating 
objectives of the United States with respect to subsidies shall 
include--
          (1) achievement of increased discipline on domestic 
        subsidies provided by a foreign government, including--
                  (A) the provision of capital, loans, or loan 
                guarantees on terms inconsistent with 
                commercial considerations;
                  (B) the provision of goods or services at 
                preferential rates;
                  (C) the granting of funds or forgiveness of 
                debt to cover operating losses sustained by a 
                specific industry; and
                  (D) the assumption of any costs or expenses 
                of manufacture, production, or distribution;
          (2) achievement of increased discipline on export 
        subsidies provided by a foreign government, 
        particularly with respect to agricultural products; and
          (3) maintenance of effective remedies against 
        subsidized imports, including, where appropriate, 
        countervailing duties.

SEC. 407. IDENTIFICATION OF INDUSTRIES FACING SUBSIDIZED IMPORTS.

    (a) Petitions.--Any entity, including a trade association, 
firm, certified or recognized union, or group of workers, that 
is representative of a United States industry and has reason to 
believe--
          (1) that--
                  (A) as a result of implementation of 
                provisions of the Agreement, the industry is 
                likely to face increased competition from 
                subsidized imports, from a NAFTA country, with 
                which it directly competes; or
                  (B) the industry is likely to face increased 
                competition from subsidized imports with which 
                it directly competes from any other country 
                designated by the President, following 
                consultations with the Congress, as benefiting 
                from a reduction of tariffs or other trade 
                barriers under a trade agreement that enters 
                into force with respect to the United States 
                after January 1, 1994; and
          (2) that the industry is likely to experience a 
        deterioration of its competitive position before more 
        effective rules and disciplines relating to the use of 
        government subsidies have been developed with respect 
        to the country concerned;
may file with the Trade Representative a petition that such 
industry be identified under this section.
    (b) Identification of Industry.--Within 90 days after 
receipt of a petition under subsection (a), the Trade 
Representative, in consultation with the Secretary of Commerce, 
shall decide whether to identify the industry on the basis that 
there is a reasonable likelihood that the industry may face 
both the subsidization described in subsection (a)(1) and the 
deterioration described in subsection (a)(2).
    (c) Action After Identification.--At the request of an 
entity that is representative of an industry identified under 
subsection (b), the Trade Representative shall--
          (1) compile and make available to the industry 
        information under section 308 of the Trade Act of 1974;
          (2) recommend to the President that an investigation 
        by the International Trade Commission be requested 
        under section 332 of the Tariff Act of 1930; or
          (3) take actions described in both paragraphs (1) and 
        (2). The industry may request the Trade Representative 
        to take appropriate action to update (as often as 
        annually) any information obtained under paragraph (1) 
        or (2), or both, as the case may be, until an agreement 
        on more effective rules and disciplines relating to 
        government subsidies is reached between the United 
        States and the NAFTA countries.
    (d) Initiation of Action Under Other Law.--
          (1) In general.--The Trade Representative and the 
        Secretary of Commerce shall review information obtained 
        under subsection (c) and consult with the industry 
        identified under subsection (b) with a view to deciding 
        whether any action is appropriate--
                  (A) under section 301 of the Trade Act of 
                1974, including the initiation of an 
                investigation under section 302(c) of that Act 
                (in the case of the Trade Representative); or
                  (B) under subtitle A of title VII of the 
                Tariff Act of 1930, including the initiation of 
                an investigation under section 702(a) of that 
                Act (in the case of the Secretary of Commerce).
          (2) Criteria for initiation.--In determining whether 
        to initiate any investigation under section 301 of the 
        Trade Act of 1974 or any other trade law, other than 
        title VII of the Tariff Act of 1930, the Trade 
        Representative, after consultation with the Secretary 
        of Commerce--
                  (A) shall seek the advice of the advisory 
                committees established under section 135 of the 
                Trade Act of 1974;
                  (B) shall consult with the Committee on 
                Finance of the Senate and the Committee on Ways 
                and Means of the House of Representatives;
                  (C) shall coordinate with the interagency 
                organization established under section 242 of 
                the Trade Expansion Act of 1962; and
                  (D) may ask the President to request advice 
                from the International Trade Commission.
          (3) Title iii actions.--In the event an investigation 
        is initiated under section 302(c) of the Trade Act of 
        1974 as a result of a review under this subsection and 
        the Trade Representative, following such investigation 
        (including any applicable dispute settlement 
        proceedings under the Agreement or any other trade 
        agreement), determines to take action under section 
        301(a) of such Act, the Trade Representative shall give 
        preference to actions that most directly affect the 
        products that benefit from governmental subsidies and 
        were the subject of the investigation, unless there are 
        no significant imports of such products or the Trade 
        Representative otherwise determines that application of 
        the action to other products would be more effective.
    (e) Effect of Decisions.--Any decision, whether positive or 
negative, or any action by the Trade Representative or the 
Secretary of Commerce under this section shall not in any way--
          (1) prejudice the right of any industry to file a 
        petition under any trade law;
          (2) prejudice, affect, or substitute for, any 
        proceeding, investigation, determination, or action by 
        the Secretary of Commerce, the International Trade 
        Commission, or the Trade Representative pursuant to 
        such a petition; or
          (3) prejudice, affect, substitute for, or obviate any 
        proceeding, investigation, or determination under 
        section 301 of the Trade Act of 1974, title VII of the 
        Tariff Act of 1930, or any other trade law.
    (f) Standing.--Nothing in this section may be construed to 
alter in any manner the requirements in effect before the date 
of the enactment of this Act for standing under any law of the 
United States or to add any additional requirements for 
standing under any law of the United States.

SEC. 408. TREATMENT OF AMENDMENTS TO ANTIDUMPING AND COUNTERVAILING 
                    DUTY LAW.

    Any amendment enacted after the Agreement enters into force 
with respect to the United States that is made to--
          (1) section 303 or title VII of the Tariff Act of 
        1930, or any successor statute, or
          (2) any other statute which--
                  (A) provides for judicial review of final 
                determinations under such section, title, or 
                successor statute, or
                  (B) indicates the standard of review to be 
                applied,
shall apply to goods from a NAFTA country only to the extent 
specified in the amendment.

            Subtitle B--Conforming Amendments and Provisions

[SEC. 411. JUDICIAL REVIEW IN ANTIDUMPING DUTY AND COUNTERVAILING DUTY 
                    CASES.

    [Amendments to section 516A of the Tariff Act of 1930 
(reprinted elsewhere).]

[SEC. 412. CONFORMING AMENDMENTS TO OTHER PROVISIONS OF THE TARIFF ACT 
                    OF 1930.

    [Amendments to sections 502b, 514(b), 771, and 777(f) of 
the Tariff Act of 1930 (reprinted elsewhere).]

[SEC. 413. CONSEQUENTIAL AMENDMENT TO FREE-TRADE AGREEMENT ACT OF 1988.

    [Amendment to section 410 of the United States-Canada Free-
Trade Agreement Implementation Act of 1988 (reprinted 
elsewhere).]

[SEC. 414. CONFORMING AMENDMENTS TO TITLE 28, UNITED STATES CODE.]

SEC. 415. EFFECT OF TERMINATION OF NAFTA COUNTRY STATUS.

    (a) In General.--Except as provided in subsection (b), on 
the date on which a country ceases to be a NAFTA country, the 
provisions of this title (other then this section) and the 
amendments made by this title shall cease to have effect with 
respect to that country.
    (b) Transition Provisions.--
          (1) Proceedings regarding protective orders and 
        undertakings.--If on the date on which a country ceases 
        to be a NAFTA country an investigation or enforcement 
        proceeding concerning the violation of a protective 
        order issued under section 777(f) of the Tariff Act of 
        1930 (as amended by this subtitle) or an undertaking of 
        the Government of that country is pending, the 
        investigation or proceeding shall continue, and 
        sanctions may continue to be imposed, in accordance 
        with the provisions of such section 777(f).
          (2) Binational panel and extraordinary challenge 
        committee reviews.--If on the date on which a country 
        ceases to be a NAFTA country--
                  (A) a binational panel review under article 
                1904 of the Agreement is pending, or has been 
                requested; or
                  (B) an extraordinary challenge committee 
                review under article 1904 of the Agreement is 
                pending, or has been requested;
        with respect to a determination which involves a class 
        or kind of merchandise and to which section 516A(g)(2) 
        of the Tariff Act of 1930 applies, such determination 
        shall be reviewable under section 516A(a) of the Tariff 
        Act of 1930. In the case of a determination to which 
        the provisions of this paragraph apply, the time limits 
        for commencing an action under section 516A(a) of the 
        Tariff Act of 1930 shall not begin to run until the 
        date on which the Agreement ceases to be in force with 
        respect to that country.

SEC. 416. EFFECTIVE DATE.

    The provisions of this title and the amendments made by 
this title take effect on the date the Agreement enters into 
force with respect to the United States, but shall not apply--
          (1) to any final determination described in paragraph 
        (1)(B), or (2)(B) (i), (ii), or (iii), of section 
        516A(a) of the Tariff Act of 1930 notice of which is 
        published in the Federal Register before such date, or 
        to a determination described in paragraph (2)(B)(vi) of 
        section 516A(a) of such Act notice of which is received 
        by the Government of Canada or Mexico before such date; 
        or
          (2) to any binational panel review under the United 
        States- Canada Free-Trade Agreement, or any 
        extraordinary challenge arising out of any such review, 
        that was commenced before such date.

 TITLE V--NAFTA TRANSITIONAL ADJUSTMENT ASSISTANCE AND OTHER PROVISIONS

     [Subtitle A--NAFTA Transitional Adjustment Assistance Program

    [Amendments adding subchapter D and making conforming 
amendments to chapter 2 of title II of the Trade Act of 1974 
(reprinted elsewhere); amendment to section 3306 of the 
Internal Revenue Code of 1986 on Self-employment Assistance 
Program and related provisions.]

   Subtitle B--Provisions Relating to Performance Under the Agreement

SEC. 511. DISCRIMINATORY TAXES.

    It is the sense of the Congress that when a State, 
province, or other governmental entity of a NAFTA country 
discriminatorily enforces sales or other taxes so as to afford 
protection to domestic production or domestic service 
providers, such enforcement is in violation of the terms of the 
Agreement. When such discriminatory enforcement adversely 
affects United States producers of goods or United States 
service providers, the Trade Representative should pursue all 
appropriate remedies to obtain removal of such discriminatory 
enforcement, including invocation of the provisions of the 
Agreement.

SEC. 512. REVIEW OF THE OPERATION AND EFFECTS OF THE AGREEMENT.

    (a) Study.--By not later than July 1, 1997, the President 
shall provide to the Congress a comprehensive study on the 
operation and effects of the Agreement. The study shall include 
an assessment of the following factors:
          (1) The net effect of the Agreement on the economy of 
        the United States, including with respect to the United 
        States gross national product, employment, balance of 
        trade, and current account balance.
          (2) The industries (including agricultural 
        industries) in the United States that have 
        significantly increased exports to Mexico or Canada as 
        a result of the Agreement, or in which imports into the 
        United States from Mexico or Canada have increased 
        significantly as a result of the Agreement, and the 
        extent of any change in the wages, employment, or 
        productivity in each such industry as a result of the 
        Agreement.
          (3) The extent to which investment in new or existing 
        production or other operations in the United States has 
        been redirected to Mexico as a result of the Agreement, 
        and the effect on United States employment of such 
        redirection.
          (4) The extent of any increase in investment, 
        including foreign direct investment and increased 
        investment by United States investors, in new or 
        existing production or other operations in the United 
        States as a result of the Agreement, and the effect on 
        United States employment of such investment.
          (5) The extent to which the Agreement has contributed 
        to--
                  (A) improvement in real wages and working 
                conditions in Mexico,
                  (B) effective enforcement of labor and 
                environmental laws in Mexico, and
                  (C) the reduction or abatement of pollution 
                in the region of the United States-Mexico 
                border.
  (b) Scope.--In assessing the factors listed in subsection 
(a), to the extent possible, the study shall distinguish 
between the consequences of the Agreement and events that 
likely would have occurred without the Agreement. In addition, 
the study shall evaluate the effects of the Agreement relative 
to aggregate economic changes and, to the extent possible, 
relative to the effects of other factors, including--
          (1) international competition,
          (2) reductions in defense spending,
          (3) the shift from traditional manufacturing to 
        knowledge and information based economic activity, and
          (4) the Federal debt burden.
  (c) Recommendations of the President.--The study shall 
include any appropriate recommendations by the President with 
respect to the operation and effects of the Agreement, 
including recommendations with respect to the specific factors 
listed in subsection (a).
  (d) Recommendations of Certain Committees.--The President 
shall provide the study to the Committee on Ways and Means of 
the House of Representatives and the Committee on Finance of 
the Senate and any other committee that has jurisdiction over 
any provision of United States law that was either enacted or 
amended by the North American Free Trade Agreement 
Implementation Act. Each such committee may hold hearings and 
make recommendations to the President with respect to the 
operation and effects of the Agreement.

[SEC. 513. ACTIONS AFFECTING UNITED STATES CULTURAL INDUSTRIES.

    [Amendment to section 182 of the Trade Act of 1974 
(reprinted elsewhere).]

SEC. 514. REPORT ON IMPACT OF NAFTA ON MOTOR VEHICLE EXPORTS TO MEXICO.

  (a) Findings.--The Congress makes the following findings:
          (1) Trade in motor vehicles and motor vehicle parts 
        is one of the most restricted areas of trade between 
        the United States and Mexico.
          (2) The elimination of Mexico's restrictive barriers 
        to trade in motor vehicles and motor vehicle parts over 
        a 10-year period under the Agreement should increase 
        substantially United States exports of such products to 
        Mexico.
          (3) The Department of Commerce estimates that the 
        Agreement provides the opportunity to increase United 
        States exports of motor vehicles and motor vehicle 
        parts by $1,000,000,000 during the first year of the 
        Agreement's implementation with the potential for 
        additional increases over the 10-year transition 
        period.
          (4) The United States automotive industry has 
        estimated that United States exports of motor vehicles 
        to Mexico should increase to more than 60,000 units 
        during the first year of the Agreement's 
        implementation, which is substantially above the 
        current level of 4,000 units.
  (b) Trade Representative Report.--No later than July 1, 1995, 
and annually thereafter through 1999, the Trade Representative 
shall submit a report to the Committee on Finance of the Senate 
and the Committee on Ways and Means of the House of 
Representatives on how effective the provisions of the 
Agreement are with respect to increasing United States exports 
of motor vehicles and motor vehicle parts to Mexico. Each 
report shall identify and determine the following:
          (1) The patterns of trade in motor vehicles and motor 
        vehicle parts between the United States and Mexico 
        during the preceding 12-month period.
          (2) The level of tariff and nontariff barriers that 
        were in force during the preceding 12-month period.
          (3) The amount by which United States exports of 
        motor vehicles and motor vehicle parts to Mexico have 
        increased from the preceding 12-month period as a 
        result of the elimination of Mexican tariff and 
        nontariff barriers under the Agreement.
          (4) Whether any such increase in United States 
        exports meets the levels of new export opportunities 
        anticipated under the Agreement.
          (5) If the anticipated levels of new United States 
        export opportunities are not reached, what actions the 
        Trade Representative is prepared to take to realize the 
        benefits anticipated under the Agreement, including 
        possible initiation of additional negotiations with 
        Mexico for the purpose of seeking modifications of the 
        Agreement.

[SEC. 515. CENTER FOR THE STUDY OF WESTERN HEMISPHERIC TRADE.

    [Amendment adding section 219 to the Caribbean Basin 
Economic Recovery Act (reprinted elsewhere).]

[SEC. 516. EFFECTIVE DATE.]

                          Subtitle C--Funding

                       PART 1--CUSTOMS USER FEES

[SEC. 521. FEES FOR CERTAIN CUSTOMS SERVICES.

    [Amendments to section 13031 by the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (reprinted elsewhere).]

                PART 2--INTERNAL REVENUE CODE AMENDMENTS

[SEC. 522. AUTHORITY TO DISCLOSE CERTAIN TAX INFORMATION TO THE UNITED 
                    STATES CUSTOMS SERVICE.

    [Amendments to section 6103 of the Internal Revenue Code by 
1986.]

[SEC. 523. USE OF ELECTRONIC FUND TRANSFER SYSTEM FOR COLLECTION OF 
                    CERTAIN TAXES.

    [Amendments to section 6302 of the Internal Revenue Code of 
1986.]

      Subtitle D--Implementation of NAFTA Supplemental Agreements

          PART 1--AGREEMENTS RELATING TO LABOR AND ENVIRONMENT

SEC. 531. AGREEMENT ON LABOR COOPERATION.

    (a) Commission for Labor Cooperation.--
          (1) Membership.--The United States is authorized to 
        participate in the Commission for Labor Cooperation in 
        accordance with the North American Agreement on Labor 
        Cooperation.
          (2) Contributions to budget.--There are authorized to 
        be appropriated to the President (or such agency as the 
        President may designate) $2,000,000 for each of fiscal 
        years 1994 and 1995 for United States contributions to 
        the annual budget of the Commission for Labor 
        Cooperation pursuant to Article 47 of the North 
        American Agreement on Labor Cooperation. Funds 
        authorized to be appropriated for such contributions by 
        this paragraph are in addition to any funds otherwise 
        available for such contributions. Funds authorized to 
        be appropriated by this paragraph are authorized to be 
        made available until expended.
  (b) Definitions.--As used in this section--
          (1) the term ``Commission for Labor Cooperation'' 
        means the commission established by Part Three of the 
        North American Agreement on Labor Cooperation; and
          (2) the term ``North American Agreement on Labor 
        Cooperation'' means the North American Agreement on 
        Labor Cooperation Between the Government of the United 
        States of America, the Government of Canada, and the 
        Government of the United Mexican States (signed at 
        Mexico City, Washington, and Ottawa on September 8, 9, 
        12, and 14, 1993).

SEC. 532. AGREEMENT ON ENVIRONMENTAL COOPERATION.

  (a) Commission for Environmental Cooperation.--
          (1) Membership.--The United States is authorized to 
        participate in the Commission for Environmental 
        Cooperation in accordance with the North American 
        Agreement on Environmental Cooperation.
          (2) Contributions to budget.--There are authorized to 
        be appropriated to the President (or such agency as the 
        President may designate) $5,000,000 for each of fiscal 
        years 1994 and 1995 for United States contributions to 
        the annual budget of the Commission for Environmental 
        Cooperation pursuant to Article 43 of the North 
        American Agreement on Environmental Cooperation. Funds 
        authorized to be appropriated for such contributions by 
        this paragraph are in addition to any funds otherwise 
        available for such contributions. Funds authorized to 
        be appropriated by this contributions. Funds authorized 
        to be appropriated by this paragraph are authorized to 
        be made available until expended.
  (b) Definitions.--As used in this section--
          (1) the term ``Commission for Environmental 
        Cooperation'' means the commission established by Part 
        Three of the North American Agreement on Environmental 
        Cooperation; and
          (2) the term ``North American Agreement on 
        Environmental Cooperation'' means the North American 
        Agreement on Environmental Cooperation Between the 
        Government of the United States of America, the 
        Government of Canada, and the Government of the United 
        Mexican States (signed at Mexico City, Washington, and 
        Ottawa on September 8, 9, 12, and 14, 1993).

SEC. 533. AGREEMENT ON BORDER ENVIRONMENT COOPERATION COMMISSION.

  (a) Border Environment Cooperation Commission.--
          (1) Membership.--The United States is authorized to 
        participate in the Border Environment Cooperation 
        Commission in accordance with the Border Environment 
        Cooperation Agreement.
          (2) Contributions to the commission budget.--There 
        are authorized to be appropriated to the President (or 
        such agency as the President may designate) $5,000,000 
        for fiscal year 1994 and each fiscal year thereafter 
        for United States contributions to the budget of the 
        Border Environment Cooperation Commission pursuant to 
        section 7 of Article III of Chapter I of the Border 
        Environment Cooperation Agreement. Funds authorized to 
        be appropriated for such contributions by this 
        paragraph are in addition to any funds otherwise 
        available for such contributions. Funds authorized to 
        be appropriated by this paragraph are authorized to be 
        made available until expended.
  (b) Civil Actions Involving the Commission.--For the purpose 
of any civil action which may be brought within the United 
States by or against the Border Environment Cooperation 
Agreement (including an action brought to enforce an arbitral 
award against the Commission), the Commission shall be deemed 
to be an inhabitant of the Federal judicial district in which 
its principal office within the United States, or its agent 
appointed for the purpose of accepted service or notice of 
service, is located. Any such action to which the Commission is 
a party shall be deemed to arise under the laws of the United 
States, and the district courts of the United States (including 
the courts enumerated in section 460 of title 28, United States 
Code) shall have original jurisdiction of any such action. When 
the Commission is a defendant in any action in a State court, 
it may at any time before trial remove the action into the 
appropriate district court of the United States by following 
the procedure for removal provided in section 1446 of title 28, 
United States Code.
  (c) Definitions.--As used in this section--
          (1) the term ``Border Environment Cooperation 
        Agreement'' means the November 1993 Agreement Between 
        the Government of the United States of America and the 
        Government of the United Mexican States Concerning the 
        Establishment of a Border Environment Cooperation 
        Commission and a North American Development Bank;
          (2) the terms ``Border Environment Cooperation 
        Commission'' and ``Commission'' mean the commission 
        established pursuant to Chapter I of the Border 
        Environment Cooperation Agreement; and
          (3) the term ``United States'' means the United 
        States, its territories and possessions, and the 
        Commonwealth of Puerto Rico.

    [PART 2--NORTH AMERICAN DEVELOPMENT BANK AND RELATED PROVISIONS

                    [TITLE VI--CUSTOMS MODERNIZATION

    [Amendments to various sections of the Tariff Act of 1930 
and other trade laws; National Customs Automation Program.]

                H. BILATERAL TRADE RELATIONS WITH ISRAEL

         Section 102(b)(1) of the Trade Act of 1974, as amended

        [19 U.S.C. 2112; P.L. 93-618, as amended by P.L. 99-47]

SEC. 102. BARRIERS TO AND OTHER DISTORTIONS OF TRADE.

    (b)(1) Whenever the President determines that any barriers 
to (or other distortions of) international trade of any foreign 
country or the United States unduly burden and restrict the 
foreign trade of the United States or adversely affect the 
United States economy, or that the imposition of such barriers 
is likely to result in such a burden, restriction, or effect, 
and that the purposes of this chapter will be promoted thereby, 
the President, during the 13-year period beginning on January 
3, 1975, may enter into trade agreements with foreign countries 
or instrumentalities providing for the harmonization, 
reduction, or elimination of such barriers (or other 
distortions) or providing for the prohibition of or limitations 
on the imposition of such barriers (or other distortions).

        Title IV of the Trade and Tariff Act of 1984, as amended

 [19 U.S.C. 2112 note; P.L. 98-573, as amended by P.L. 99-47, P.L. 99-
                         514, and P.L. 100-418]

SEC. 401. NEGOTIATION OF TRADE AGREEMENTS TO REDUCE TRADE BARRIERS.

           *       *       *       *       *       *       *


    (2)(A) Trade agreements that provide for the elimination or 
reduction of any duty imposed by the United States may be 
entered into under paragraph (1) only with Israel.
    (B) The negotiation of any trade agreement entered into 
under paragraph (1) with Israel that provides for the 
elimination or reduction of any duty imposed by the United 
States shall take fully into account any product that benefits 
from a discriminatory preferential tariff arrangement between 
Israel and a third country if the tariff preference on such 
product has been the subject of a challenge by the United 
States Government under the authority of section 301 of the 
Trade Act of 1974 and the General Agreement on Tariffs and 
Trade.
    (C) Notwithstanding any other provision of this section, 
the requirements of subsections (c) and (e)(1) shall not apply 
to any trade agreement entered into under paragraph (1) with 
Israel that provides for the elimination or reduction of any 
duty imposed by the United States.
    (3) Notwithstanding any other provision of law, no trade 
benefit shall be extended to any country by reason of the 
extension of any trade benefit to another country under a trade 
agreement entered into under paragraph (1) with such other 
country.
    [Paragraph (4) was superseded by sections 1102 and 1103 of 
the Omnibus Trade and Competitiveness Act of 1988 with respect 
to bilateral trade agreements with countries other than 
Israel.]

SEC. 402. CRITERIA FOR DUTY-FREE TREATMENT OF ARTICLES.

    (a)(1) The reduction or elimination of any duty imposed on 
any article by the United States provided for in a trade 
agreement entered into with Israel under section 102(b)(1) of 
the Trade Act of 1974 shall apply only if--
          (A) that article is the growth, product, or 
        manufacture of Israel or is a new or different article 
        of commerce that has been grown, produced, or 
        manufactured in Israel;
          (B) that article is imported directly from Israel 
        into the customs territory of the United States; and
          (C) the sum of--
                  (i) the cost of value of the materials 
                produced in Israel, plus
                  (ii) the direct costs of processing 
                operations performed in Israel,
        is not less than 35 percent of the appraised value of 
        such article at the time it is entered.
If the cost or value of materials produced in the customs 
territory of the United States is included with respect to an 
article to which this subsection applies, an amount not to 
exceed 15 percent of the appraised value of the article at the 
time it is entered that is attributable to such United States 
cost or value may be applied toward determining the percentage 
referred to in subparagraph (C).
    (2) No article may be considered to meet the requirements 
of paragraph (1)(A) by virtue of having merely undergone--
          (A) simple combining or packaging operations; or
          (B) mere dilution with water or mere dilution with 
        another substance that does not materially alter the 
        characteristics of the article.
    (b) As used in this section, the phrase ``direct costs of 
processing operations'' includes, but is not limited to--
          (1) all actual labor costs involved in the growth, 
        production, manufacture, or assembly of the specific 
        merchandise, including fringe benefits, on-the-job 
        training and the cost of engineering, supervisory, 
        quality control, and similar personnel; and
          (2) dies, molds, tooling, and depreciation on 
        machinery and equipment which are allocable to the 
        specific merchandise.
Such phrase does not include costs which are not directly 
attributable to the merchandise concerned, or are not costs of 
manufacturing the product, such as (A) profit, and (B) general 
expenses of doing business which are either not allocable to 
the specific merchandise or are not related to the growth, 
production, manufacture, or assembly of the merchandise, such 
as administrative salaries, casualty and liability insurance, 
advertising, and salesmen's salaries, commissions or expenses.
    (c) Regulations.--The Secretary of the Treasury, after 
consultation with the United States Trade Representative, shall 
prescribe such regulations as may be necessary to carry out 
this section.

SEC. 403. APPLICATION OF CERTAIN OTHER TRADE LAW PROVISIONS.

    (a) Suspension of Duty-Free Treatment.--The President may 
by proclamation suspend the reduction or elimination of any 
duty provided under any trade agreement provision entered into 
with Israel under the authority of section 102(b)(1) of the 
Trade Act of 1974 with respect to any article and may proclaim 
a duty rate for such article if such action is proclaimed under 
section 203 of the Trade Act of 1974 or section 232 of the 
Trade Expansion Act of 1962.
    (b) ITC Reports.--In any report by the United States 
International Trade Commission (hereinafter referred to in this 
title as the ``Commission'') to the President under section 
202(f) of the Trade Act of 1974 regarding any article for which 
a reduction or elimination of any duty is provided under a 
trade agreement entered into with Israel under section 
102(b)(1) of the Trade Act of 1974, the Commission shall state 
whether and to what extent its findings and recommendations 
apply to such an article when imported from Israel.
    (c) For purposes of section 203 of the Trade Act of 1974, 
the suspension of the reduction or elimination of a duty under 
subsection (a) shall be treated as an increase in duty.
    (d) No proclamation which provides solely for a suspension 
referred to in subsection (a) with respect to any article shall 
be made under section 203 of the Trade Act of 1974 unless the 
Commission, in addition to making an affirmative determination 
with respect to such article under section 202(b) of the Trade 
Act of 1974, determines in the course of its investigation 
under that section that the serious injury (or threat thereof) 
substantially caused by imports to the domestic industry 
producing a like or directly competitive article results from 
the reduction or elimination of any duty provided under any 
trade agreement provision entered into with Israel under under 
section 102(b)(1) of the Trade Act of 1974.
    (e)(1) Any proclamation issued under section 203 of the 
Trade Act of 1974 that is in effect when an agreement with 
Israel is entered into under section 102(b)(1) of the Trade Act 
of 1974 shall remain in effect until modified or terminated.
    (2) If any article is subject to import relief at the time 
an agreement is entered into with Israel under section 
102(b)(1) of the Trade Act of 1974, the President may reduce or 
terminate the application of such import relief to the 
importation of such article before the otherwise scheduled date 
on which such reduction or termination would occur pursuant to 
the criteria and procedures of sections 203 and 204 of the 
Trade Act of 1974.

SEC. 404. FAST TRACK PROCEDURES FOR PERISHABLE ARTICLES.

    (a) If a petition is filed with the Commission under the 
provisions of section 202(a) of the Trade Act of 1974 regarding 
a perishable product which is subject to any reduction or 
elimination of a duty imposed by the United States under a 
trade agreement entered into with Israel under section 
102(b)(1) of the Trade Act of 1974 and alleges injury from 
imports of that product, then the petition may also be filed 
with the Secretary of Agriculture with a request that emergency 
relief be granted under subsection (c) with respect to such 
article.
    (b) Within 14 days after the filing of a petition under 
subsection (a)--
          (1) if the Secretary of Agriculture has reason to 
        believe that a perishable product from Israel is being 
        imported into the United States in such increased 
        quantities as to be a substantial cause of serious 
        injury, or the threat thereof, to the domestic industry 
        producing a perishable product like or directly 
        competitive with the imported product and that 
        emergency action is warranted, he shall advise the 
        President and recommend that the President take 
        emergency action; or
          (2) the Secretary of Agriculture shall publish a 
        notice of his determination not to recommend the 
        imposition of emergency action and so advise the 
        petitioner.
    (c) Within 7 days after the President receives a 
recommendation from the Secretary of Agriculture to take 
emergency action under subsection (b), he shall issue a 
proclamation withdrawing the reduction or elimination of duty 
provided to the perishable product under any trade agreement 
provision entered into under section 102(b)(1) of the Trade Act 
of 1974 or publish a notice of his determination not to take 
emergency action.
    (d) The emergency action provided under subsection (c) 
shall cease to apply--
          (1) upon the taking of action under section 203 of 
        the Trade Act of 1974;
          (2) on the day a determination of the President under 
        section 203 of such Act not to take action becomes 
        final;
          (3) in the event of a report of the Commission 
        containing a negative finding, on the day the 
        Commission's report is submitted to the President; or
          (4) whenever the President determines that because of 
        changed circumstances such relief is no longer 
        warranted.
    (e) For purposes of this section, the term ``perishable 
product'' means any--
          (1) live plants and fresh cut flowers provided for in 
        chapter 6 of the Harmonized Tariff Schedule of the 
        United States (19 U.S.C. 1202, hereinafter referred to 
        as the ``HTS'');
          (2) vegetables, edible nuts or fruit provided for in 
        chapters 7 and 8, heading 1105, subheadings 1106.10.00 
        and 1106.30, heading 1202, subheadings 1214.90.00 and 
        1704.90.60, headings 2001 through 2008 (excluding 
        subheadings 2001.90.20 and 2004.90.10) and subheading 
        2103.20.40 of the HTS;
          (3) concentrated citrus fruit juice provided for in 
        subheadings 2009.11.00, 2009.19.40, 2009.20.40, 
        2009.30.20, and 2009.30.60 of the HTS.
    (f) No trade agreement entered into with Israel under 
section 102(b)(1) of the Trade Act of 1974 shall affect fees 
imposed under section 22 of the Agricultural Adjustment Act (7 
U.S.C. 624).

SEC. 405. CONSTRUCTION OF TITLE.

    Neither the taking effect of any trade agreement provision 
entered into with Israel under section 102(b)(1), nor any 
proclamation issued to implement any such provision, may affect 
in any manner, or to any extent, the application to any Israeli 
articles of section 232 of the Trade Expansion Act of 1962, 
section 337 of title VII of the Tariff Act of 1930, chapter 1 
of title II and chapter 1 of title III of the Trade Act of 
1974, or any other provision of law under which relief from 
injury caused by import competition or by unfair import trade 
practices may be sought.

  United States-Israel Free Trade Area Implementation Act of 1985, as 
                                amended


     [19 U.S.C. 2112 note; P.L. 99-47, as amended by P.L. 104-234]

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States-Israel Free 
Trade Area Implementation Act of 1985''.

SEC. 2. PURPOSES.

    The purposes of this Act are--
          (1) to approve and implement the agreement on the 
        establishment of a free trade area between the United 
        States and Israel negotiated under the authority of 
        section 102 of the Trade Act of 1974;
          (2) to strengthen and develop the economic relations 
        between the United States and Israel for their mutual 
        benefit; and
          (3) to establish free trade between the two nations 
        through the removal of trade barriers.

SEC. 3. APPROVAL OF A FREE TRADE AREA AGREEMENT.

    Pursuant to section 102 and 151 of the Trade Act of 1974 
(19 U.S.C. 2112; 2191), the Congress approves--
          (1) the Agreement on the Establishment of a Free 
        Trade Area between the Government of the United States 
        of America and the Government of Israel (hereinafter in 
        this Act referred to as ``the Agreement'') entered into 
        on April 22, 1985, and submitted to the Congress on 
        April 29, 1985, and
          (2) the statement of administrative action proposed 
        to implement the Agreement that was submitted to the 
        Congress on April 29, 1985.

SEC. 4. PROCLAMATION AUTHORITY.

    (a) Tariff Modifications.--Except as provided in subsection 
(c), the President may proclaim--
          (1) such modifications or continuance of any existing 
        duty,
          (2) such continuance of existing duty-free or excise 
        treatment, or
          (3) such additional duties,
as the President determines to be required or appropriate to 
carry out the schedule of duty reductions with respect to 
Israel set forth in annex 1 of the Agreement.
    (b) Additional Tariff Modification Authority.--Except as 
provided in subsection (c), whenever the President determines 
that it is necessary to maintain the general level of 
reciprocal and mutually advantageous concessions with respect 
to Israel provided for by the Agreement, the President may 
proclaim--
          (1) such withdrawal, suspension, modification, or 
        continuance of any duty,
          (2) such continuance of existing duty-free or excise 
        treatment, or
          (3) such additional duties,
as the President determines to be required or appropriate to 
carry out the Agreement.
    (c) Exception to Authority.--No modification of any duty 
imposed on any article provided for in paragraph (4) of annex 1 
of the Agreement that may be proclaimed under subsection (a) or 
(b) shall take effect prior to January 1, 1995.

SEC. 5. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES LAW.

    (a) United States Statutes To Prevail in Conflict.--No 
provision of the Agreement, nor the application of any such 
provision to any person or circumstance, which is in conflict 
with--
          (1) title IV of the Trade and Tariff Act of 1984, or
          (2) any other statute of the United States,
shall be given effect under the laws of the United States.
    (b) Implementing Regulations.--Regulations that are 
necessary or appropriate to carry out actions proposed in any 
statement of proposed administrative action submitted to the 
Congress under section 102 of the Trade Act of 1974 (19 U.S.C. 
2112) in order to implement the Agreement shall be prescribed. 
Initial regulations to carry out such action shall be issued 
within one year after the date of the entry into force of the 
Agreement.
    (c) Changes in Statutes To Implement a Requirement, 
Amendment, or Recommendation.--
          (1) Except as otherwise provided in paragraph (2), 
        the provisions of section 3(c) of the Trade Agreements 
        Act of 1979 (19 U.S.C. 2504(c)) shall apply with 
        respect to the Agreement and--
                  (A) no requirement of, amendment to, or 
                recommendation under the Agreement shall be 
                implemented under United States law, and
                  (B) no amendment, repeal, or enactment of a 
                statute of the United States to implement any 
                such requirement, amendment, or recommendation 
                shall enter into force with respect to the 
                United States,
        unless there has been compliance with the provisions of 
        section 3(c) of the Trade Agreements Act of 1979.
          (2) The provisions of section 3(c)(4) of the Trade 
        Agreements Act of 1979 (19 U.S.C. 2504(c)(4)) shall 
        apply to any bill implementing any requirement of, 
        amendment to, or recommendation made under, the 
        Agreement that reduces or eliminates any duty imposed 
        on any article provided for in paragraph (4) of Annex 1 
        of the Agreement only if--
                  (A) any reduction of such duty provided in 
                such bill--
                          (i) takes effect after December 31, 
                        1989, and
                          (ii) takes effect gradually over the 
                        period that begins on January 1, 1990, 
                        and ends on December 31, 1994,
                  (B) any elimination of such duty provided in 
                such bill does not take effect prior to January 
                1, 1995, and
                  (C) the consultations required under section 
                3(c)(1) of such Act occur at least ninety days 
                prior to the date on which such bill is 
                submitted to the Congress under section 3(c) of 
                such Act.
    (d) Private Remedies Not Created.--Neither the entry into 
force of the Agreement with respect to the United States, nor 
the enactment of this Act, shall be construed as creating any 
private right of action or remedy for which provision is not 
explicitly made under this Act or under the laws of the United 
States.

SEC. 6. TERMINATION.

    The provisions of section 125(a) of the Trade Act of 1974 
(19 U.S.C. 2135(a)) shall not apply to the Agreement.

[SEC. 7. LOWERED THRESHOLD FOR GOVERNMENT PROCUREMENT UNDER TRADE 
                    AGREEMENTS ACT OF 1979 IN THE CASE OF CERTAIN 
                    ISRAELI PRODUCTS.

    [Amendment to section 308(4) of the Trade Agreements Act of 
1979 (reprinted elsewhere).]

[SEC. 8. TECHNICAL AMENDMENTS.

    [Technical amendments to sections 402(a), 404(e), and 406 
of the Trade and Tariff Act of 1984 and section 102(b) and 
Title V of the Trade Act of 1974.]

SEC. 9. ADDITIONAL PROCLAMATION AUTHORITY.

  (a) Elimination or Modifications of Duties.--The President is 
authorized to proclaim elimination or modification of any 
existing duty as the President determines is necessary to 
exempt any article from duty if--
          (1) that article is wholly the growth, product, or 
        manufacture of the West Bank, the Gaza Strip, or a 
        qualifying industrial zone or is a new or different 
        article of commerce that has been grown, produced, or 
        manufactured in the West Bank, the Gaza Strip, or a 
        qualifying industrial zone;
          (2) that article is imported directly from the West 
        Bank, the Gaza Strip, Israel, or a qualifying 
        industrial zone; and
          (3) the sum of--
                  (A) the cost or value of the materials 
                produced in the West Bank, the Gaza Strip, 
                Israel, or a qualifying industrial zone, plus
                  (B) the direct costs of processing operations 
                performed in the West Bank, the Gaza Strip, 
                Israel, or a qualifying industrial zone,
        is not less than 35 percent of the appraised value of 
        the product at the time it is entered into the United 
        States.
For purposes of determining the 35 percent content requirement 
contained in paragraph (3), the cost or value of materials 
which are used in the production of an article in the West 
Bank, the Gaza Strip, or a qualifying industrial zone, and are 
the products of the United States, may be counted in an amount 
up to 15 percent of the appraised value of the article.
  (b) Applicability of Certain Provisions of the Agreement.--
          (1) Nonqualifying operations.--No article shall be 
        considered a new or different article of commerce under 
        this section, and no material shall be included for 
        purposes of determining the 35 percent requirement of 
        subsection (a)(3), by virtue of having merely 
        undergone--
                  (A) simple combining or packaging operations, 
                or
                  (B) mere dilution with water or with another 
                substance that does not materially alter the 
                characteristics of the article or material.
          (2) Requirements for new or different article of 
        commerce.--For purposes of subsection (a)(1), an 
        article is a ``new or different article of commerce'' 
        if it is substantially transformed into an article 
        having a new name, character, or use.
          (3) Cost or value of materials.--(A) For purposes of 
        this section, the cost or value of materials produced 
        in the West Bank, the Gaza Strip, or a qualifying 
        industrial zone includes--
                  (i) the manufacturer's actual cost for the 
                materials;
                  (ii) when not included in the manufacturer's 
                actual cost for the materials, the freight, 
                insurance, packing, and all other costs 
                incurred in transporting the materials to the 
                manufacturer's plant;
                  (iii) the actual cost of waste or spoilage, 
                less the value of recoverable scrap; and
                  (iv) taxes or duties imposed on the materials 
                by the West Bank, the Gaza Strip, or a 
                qualifying industrial zone, if such taxes or 
                duties are not remitted on exportation.
          (B) If a material is provided to the manufacturer 
        without charge, or at less than fair market value, its 
        cost or value shall be determined by computing the sum 
        of--
                  (i) all expenses incurred in the growth, 
                production, or manufacture of the material, 
                including general expenses;
                  (ii) an amount for profit; and
                  (iii) freight, insurance, packing, and all 
                other costs incurred in transporting the 
                material to the manufacturer's plant.
        If the information necessary to compute the cost or 
        value of a material is not available, the Customs 
        Service may ascertain or estimate the value thereof 
        using all reasonable methods.
          (4) Direct costs of processing operations.--(A) For 
        purposes of this section, the ``direct costs of 
        processing operations performed in the West Bank, Gaza 
        Strip, or a qualifying industrial zone'' with respect 
        to an article are those costs either directly incurred 
        in, or which can be reasonably allocated to, the 
        growth, production, manufacture, or assembly, of that 
        article. Such costs include, but are not limited to, 
        the following to the extent that they are includible in 
        the appraised value of articles imported into the 
        United States:
                  (i) All actual labor costs involved in the 
                growth, production, manufacture, or assembly of 
                the article, including fringe benefits, on-the-
                job training, and costs of engineering, 
                supervisory, quality control, and similar 
                personnel.
                  (ii) Dies, molds, tooling, and depreciation 
                on machinery and equipment which are allocable 
                to the article.
                  (iii) Research, development, design, 
                engineering, and blueprint costs insofar as 
                they are allocable to the article.
                  (iv) Costs of inspecting and testing the 
                article.
          (B) Those items that are not included as direct costs 
        of processing operations with respect to an article are 
        those which are not directly attributable to the 
        article or are not costs of manufacturing the article. 
        Such items include, but are not limited to--
                  (i) profit; and
                  (ii) general expenses of doing business which 
                are either not allocable to the article or are 
                not related to the growth, production, 
                manufacture, or assembly of the article, such 
                as administrative salaries, casualty and 
                liability insurance, advertising, and 
                salesmen's salaries, commissions, or expenses.
          (5) Imported directly.--For purposes of this 
        section--
                  (A) articles are ``imported directly'' if--
                          (i) the articles are shipped directly 
                        from the West Bank, the Gaza Strip, a 
                        qualifying industrial zone, or Israel 
                        into the United States without passing 
                        through the territory of any 
                        intermediate country; or
                          (ii) if shipment is through the 
                        territory of an intermediate country, 
                        the articles in the shipment do not 
                        enter into the commerce of any 
                        intermediate country and the invoices, 
                        bills of lading, and other shipping 
                        documents specify the United States as 
                        the final destination; or
                  (B) if articles are shipped through an 
                intermediate country and the invoices and other 
                documents do not specify the United States as 
                the final destination, then the articles in the 
                shipment, upon arrival in the United States, 
                are imported directly only if they--
                          (i) remain under the control of the 
                        customs authority in an intermediate 
                        country;
                          (ii) do not enter into the commerce 
                        of an intermediate country except for 
                        the purpose of a sale other than at 
                        retail, but only if the articles are 
                        imported as a result of the original 
                        commercial transactions between the 
                        importer and the producer or the 
                        producer's sales agent; and
                          (iii) have not been subjected to 
                        operations other than loading, 
                        unloading, or other activities 
                        necessary to preserve the article in 
                        good condition.
          (6) Documentation required.--An article is eligible 
        for the duty exemption under this section only if--
                  (A) the importer certifies that the article 
                meets the conditions for the duty exemption; 
                and
                  (B) when requested by the Customs Service, 
                the importer, manufacturer, or exporter submits 
                a declaration setting forth all pertinent 
                information with respect to the article, 
                including the following:
                          (i) A description of the article, 
                        quantity, numbers, and marks of 
                        packages, invoice numbers, and bills of 
                        lading.
                          (ii) A description of the operations 
                        performed in the production of the 
                        article in the West Bank, the Gaza 
                        Strip, a qualifying industrial zone, or 
                        Israel and identification of the direct 
                        costs of processing operations.
                          (iii) A description of any materials 
                        used in production of the article which 
                        are wholly the growth, product, or 
                        manufacture of the West Bank, the Gaza 
                        Strip, a qualifying industrial zone, 
                        Israel or United States, and a 
                        statement as to the cost or value of 
                        such materials.
                          (iv) A description of the operations 
                        performed on, and a statement as to the 
                        origin and cost or value of, any 
                        foreign materials used in the article 
                        which are claimed to have been 
                        sufficiently processed in the West 
                        Bank, the Gaza Strip, a qualifying 
                        industrial zone, or Israel so as to be 
                        materials produced in the West Bank, 
                        the Gaza Strip, a qualifying industrial 
                        zone, or Israel.
                          (v) A description of the origin and 
                        cost or value of any foreign materials 
                        used in the article which have not been 
                        substantially transformed in the West 
                        Bank, the Gaza Strip, or a qualifying 
                        industrial zone.
  (c) Shipment of Articles of Israel Through West Bank or Gaza 
Strip.--The President is authorized to proclaim that articles 
of Israel may be treated as though they were articles directly 
shipped from Israel for the purposes of the Agreement even if 
shipped to the United States from the West Bank, the Gaza 
Strip, or a qualifying industrial zone, if the articles 
otherwise meet the requirements of the Agreement.
  (d) Treatment of Cost or Value of Materials.--The President 
is authorized to proclaim that the cost or value of materials 
produced in the West Bank, the Gaza Strip, or a qualifying 
industrial zone may be included in the cost or value of 
materials produced in Israel under section 1(c)(i) of Annex 3 
of the Agreement, and the direct costs of processing operations 
performed in the West Bank, the Gaza Strip, or a qualifying 
industrial zone may be included in the direct costs of 
processing operations performed in Israel under section 
1(c)(ii) of Annex 3 of the Agreement.
  (e) Qualifying Industrial Zone Defined.--For puposes of this 
section, a ``qualifying industrial zone'' means any area that--
          (1) encompasses portions of the territory of Israel 
        and Jordan or Israel and Egypt;
          (2) has been designated by local authorities as an 
        enclave where merchandise may enter without payment of 
        duty or excise taxes; and
          (3) has been specified by the President as a 
        qualifying industrial zone.

                I. BILATERAL TRADE RELATIONS WITH CANADA


 United States-Canada Free-Trade Agreement Implementation Act of 1988, 
                               as amended


 [19 U.S.C. 2112 note; P.L. 100-449, as amended by P.L. 101-207, P.L. 
                       101-382 and P.L. 103-182]

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``United 
States-Canada Free-Trade Agreement Implementation Act of 
1988''.
  [(b) Table of Contents.]

SEC. 2. PURPOSES.

  The purposes of this Act are--
          (1) to approve and implement the Free-Trade Agreement 
        between the United States and Canada negotiated under 
        the authority of section 102 of the Trade Act of 1974;
          (2) to strengthen and develop economic relations 
        between the United States and Canada for their mutual 
        benefit;
          (3) to establish a free-trade area between the two 
        nations through the reduction and elimination of 
        barriers to trade in goods and services and to 
        investment; and
          (4) to lay the foundation for further cooperation to 
        expand and enhance the benefits of such Agreement.

  TITLE I--APPROVAL OF UNITED STATES-CANADA FREE-TRADE AGREEMENT AND 
             RELATIONSHIP OF AGREEMENT TO UNITED STATES LAW


SEC. 101. APPROVAL OF UNITED STATES-CANADA FREE-TRADE AGREEMENT.

  (a) Approval of Agreement and Statement of Administrative 
Action.--Pursuant to sections 102 and 151 of the Trade Act of 
1974 (19 U.S.C. 2112 and 2191), the Congress approves--
          (1) the United States-Canada Free-Trade Agreement 
        (hereinafter in this Act referred to as the 
        ``Agreement'') entered into on January 2, 1988, and 
        submitted to the Congress on July 25, 1988;
          (2) the letters exchanged between the Governments of 
        the United States and Canada--
                  (A) dated January 2, 1988, relating to 
                negotiations regarding articles 301 (Rules of 
                Origin) and 401 (Tariff Elimination) of the 
                Agreement, and
                  (B) dated January 2, 1988, relating to 
                negotiations regarding article 2008 (Plywood 
                Standards) of the Agreement; and
          (3) the statement of administrative action proposed 
        to implement the Agreement that was submitted to the 
        Congress on July 25, 1988.
  (b) Conditions for Entry Into Force of the Agreement.--At 
such time as the President determines that Canada has taken 
measures necessary to comply with the obligations of the 
Agreement, the President is authorized to exchange notes with 
the Government of Canada providing for the entry into force, on 
or after January 1, 1989, of the Agreement with respect to the 
United States.
  (c) Report on Canadian Practices.--Within 60 days after the 
date of the enactment of this Act (but not later than December 
15, 1988), the United States Trade Representative shall submit 
to the Congress a report identifying, to the maximum extent 
practicable, major current Canadian practices (and the legal 
authority for such practices) that, in the opinion of the 
United States Trade Representative--
          (1) are not in conformity with the Agreement; and
          (2) require a change of Canadian law, regulation, 
        policy, or practice to enable Canada to conform with 
        its international obligations under the Agreement.

SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES LAW.

  (a) United States Laws To Prevail in Conflict.--No provision 
of the Agreement, nor the application of any such provision to 
any person or circumstance, which is in conflict with any law 
of the United States shall have effect.
  (b) Relationship of Agreement to State and Local Law.--
          (1) The provisions of the Agreement prevail over--
                  (A) any conflicting State law; and
                  (B) any conflicting application of any State 
                law to any person or circumstance;
        to the extent of the conflict.
          (2) Upon the enactment of this Act, the President 
        shall, in accordance with section 306(c)(2)(A) of the 
        Trade and Tariff Act of 1984 (19 U.S.C. 2114c), 
        initiate consultations with the State governments on 
        the implementation of the obligations of the United 
        States under the Agreement. Such consultations shall be 
        held--
                  (A) through the intergovernmental policy 
                advisory committees on trade established under 
                such section for the purpose of achieving 
                conformity of State laws and practices with the 
                Agreement; and
                  (B) with the individual States as necessary 
                to deal with particular questions that may 
                arise.
          (3) The United States may bring an action challenging 
        any provision of State law, or the application thereof 
        to any person or circumstance, on the ground that the 
        provision or application is inconsistent with the 
        Agreement.
          (4) For purposes of this subsection, the term ``State 
        law'' includes--
                  (A) any law of a political subdivision of a 
                State; and
                  (B) any State law regulating or taxing the 
                business of insurance.
  (c) Effect of Agreement With Respect to Private Remedies.--No 
person other than the United States shall--
          (1) have any cause of action or defense under the 
        Agreement or by virtue of congressional approval 
        thereof, or
          (2) challenge, in any action brought under any 
        provision of law, any action or inaction by any 
        department, agency, or other instrumentality of the 
        United States, any State, or any political subdivision 
        of a State on the ground that such action or inaction 
        is inconsistent with the Agreement.
  (d) Initial Implementing Regulations.--Initial regulations 
necessary or appropriate to carry out the actions proposed in 
the statement of administrative action submitted under section 
101(a)(3) to implement the Agreement shall, to the maximum 
extent feasible, be issued within 1 year after the date of 
entry into force of the Agreement. In the case of any 
implementing action that takes effect after the date of entry 
into force of the Agreement, initial regulations to carry out 
that action shall, to the maximum extent feasible, be issued 
within 1 year after such effective date.
  (e) Changes in Statutes To Implement a Requirement, 
Amendment, or Recommendation.--The provisions of section 3(c) 
of the Trade Agreements Act of 1979 (19 U.S.C. 2504(c)) shall 
apply as if the Agreement were an agreement approved under 
section 2(a) of that Act whenever the President determines that 
it is necessary or appropriate to amend, repeal, or enact a 
statute of the United States in order to implement any 
requirement of, amendment to, or recommendation, finding or 
opinion under, the Agreement; but such provisions shall not 
apply to any bill to implement any such requirement, amendment, 
recommendation, finding, or opinion that is submitted to the 
Congress after the close of the 30th month after the month in 
which the Agreement enters into force.

SEC. 103. CONSULTATION AND LAY-OVER REQUIREMENTS FOR, AND EFFECTIVE 
                    DATE OF, PROCLAIMED ACTIONS.

  (a) Consultation and Lay-Over Requirements.--If a provision 
of this Act provides that the implementation of an action by 
the President by proclamation is subject to the consultation 
and lay-over requirements of this section, such action may be 
proclaimed only if--
          (1) the President has obtained advice regarding the 
        proposed action from--
                  (A) the appropriate advisory committees 
                established under section 135 of the Trade Act 
                of 1974, and
                  (B) the United States International Trade 
                Commission;
          (2) the President has submitted a report to the 
        Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate that sets forth--
                  (A) the action proposed to be proclaimed and 
                the reasons therefor, and
                  (B) the advice obtained under paragraph (1);
          (3) a period of at least 60 calendar days that begins 
        on the first day on which the President has met the 
        requirements of paragraphs (1) and (2) with respect to 
        such action has expired; and
          (4) the President has consulted with such Committees 
        regarding the proposed action during the period 
        referred to in paragraph (3).
  (b) Effective Date of Certain Proclaimed Actions.--No action 
proclaimed by the President under the authority of this Act, if 
such action is not subject to the consultation and lay-over 
requirements under subsection (a), may take effect before the 
15th day after the date on which the text of the proclamation 
is published in the Federal Register.

SEC. 104. HARMONIZED SYSTEM.

  (a) Definition.--As used in this Act, the term ``Harmonized 
System'' means the nomenclature system established under the 
International Convention on the Harmonized Commodity 
Description and Coding System (done at Brussels on June 14, 
1983, and the protocol thereto, done at Brussels on June 24, 
1986) as implemented under United States law.
  (b) Interim Application of TSUS.--The following apply if the 
International Convention, and the protocol thereto, referred to 
in subsection (a) are not implemented under United States law 
before the Agreement enters into force:
          (1) The President, subject to subsection (c), shall 
        proclaim such modifications to the Tariff Schedules of 
        the United States (19 U.S.C. 1202) as may be necessary 
        to give effect, until such time as such Convention and 
        protocol are so implemented, to the rules of origin, 
        schedule of rate reductions, and other provisions that 
        would, but for the absence of such implementation, be 
        proclaimed under the authority of this Act to, or in 
        terms of, the Harmonized System to implement the 
        obligations of the United States under the Agreement.
          (2) Until such time as such Convention and protocol 
        are so implemented, any reference in this Act to the 
        nomenclature of such Convention and protocol shall be 
        treated as a reference to the corresponding 
        nomenclature of the Tariff Schedules of the United 
        States as modified under paragraph (1).
    (c) Restrictions.--
          (1) No modification described in subsection (b)(1) 
        that is to take effect concurrently with the entry into 
        force of the Agreement may be proclaimed unless the 
        text of the modification is published in the Federal 
        Register at least 30 days before the date of entry into 
        force.
          (2) All modifications proclaimed under the authority 
        of subsection (b)(1) after the Agreement enters into 
        force with respect to the United States are subject to 
        the consultation and lay-over requirements of section 
        103(a).

SEC. 105. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE.

    Subject to section 103 or 104(c), as appropriate, and any 
other applicable restriction or limitation in this Act on the 
proclaiming of actions or the issuing of regulations to carry 
out this Act or any amendment made by this Act, after the date 
of the enactment of this Act--
          (1) the President may proclaim such actions; and
          (2) other appropriate officers of the United States 
        Government may issue such regulations;
as may be necessary to ensure that any provision of this Act, 
or amendment made by this Act, that takes effect on the date 
the Agreement enters into force is appropriately implemented on 
such date, but no such proclamation or regulation may have an 
effective date earlier than the date of entry into force.

 TITLE II--TARIFF MODIFICATIONS, RULES OF ORIGIN, USER FEES, DRAWBACK, 
               ENFORCEMENT, AND OTHER CUSTOMS PROVISIONS


SEC. 201. TARIFF MODIFICATIONS.

  (a) Tariff Modifications Specified in the Agreement.--The 
President may proclaim--
          (1) such modifications or continuance of any existing 
        duty;
          (2) such continuance of existing duty-free or excise 
        treatment; or
          (3) such additional duties;
as the President determines to be necessary or appropriate to 
carry out article 401 of the Agreement and the schedule of duty 
reductions with respect to Canada set forth in Annexes 401.2 
and 401.7 to the Agreement, as approved under section 
101(a)(1). For purposes of proclaiming necessary modifications 
under such Annex 401.2, any article covered under subheading 
9813.00.05 (contained in the United States Schedule in such 
Annex) shall, unless such article is a drawback eligible good 
under section 204(a), be treated as being subject to any 
otherwise applicable customs duty if the article, or 
merchandise incorporating such article, is exported to Canada.
    (b) Other Tariff Modifications.--Subject to the 
consultation and lay-over requirements of section 103(a), the 
President may proclaim--
          (1) such modifications as the United States and 
        Canada may agree to regarding the staging of any duty 
        treatment set forth in Annexes 401.2 and 401.7 of the 
        Agreement;
          (2) such modifications or continuance of any existing 
        duty;
          (3) such continuance of existing duty-free or excise 
        treatment; or
          (4) such additional duties;
as the President determines to be necessary or appropriate to 
maintain the general level of reciprocal and mutually 
advantageous concessions with respect to Canada provided for by 
the Agreement.
    (c) Modifications Affecting Plywood.--
          (1) The Congress encourages the President to 
        facilitate the preparation, and the implementation with 
        Canada, of common performance standards for the use of 
        softwood, plywood, and other structural panels in 
        construction applications in the United States and 
        Canada.
          (2) The President shall report to the Congress on the 
        incorporation of common plywood performance standards 
        into building codes in the United States and Canada and 
        may implement the provisions of article 2008 of the 
        Agreement when he determines that the necessary 
        conditions have been met.
          (3) Any tariff reduction undertaken pursuant to 
        paragraph (2) shall be in equal annual increments 
        ending January 1, 1998, unless those reductions 
        commence after January 1, 1991.

SEC. 202. RULES OF ORIGIN.

    (a) In General.--
          (1) For purposes of implementing the tariff treatment 
        contemplated under the Agreement, goods originate in 
        the territory of a Party if--
                  (A) they are wholly obtained or produced in 
                the territory of either Party or both Parties; 
                or
                  (B) they--
                          (i) have been transformed in the 
                        territory of either Party or both 
                        Parties so as to be subject to a change 
                        in tariff classification as described 
                        in the Annex rules or to such other 
                        requirements as the Annex rules may 
                        provide when no change in tariff 
                        classifications occurs, and
                          (ii) meet the other conditions set 
                        out in the Annex.
          (2) A good shall not be considered to originate in 
        the territory of a party under paragraph (1)(B) merely 
        by virtue of having undergone--
                  (A) simple packaging or, except as expressly 
                provided by the Annex rules, combining 
                operations;
                  (B) mere dilution with water or another 
                substance that does not materially alter the 
                characteristics of the good; or
                  (C) any process or work in respect of which 
                it is established, or in respect of which the 
                facts as ascertained clearly justify the 
                presumption, that the sole object was to 
                circumvent the provisions of chapter 3 of the 
                Agreement.
          (3) Accessories, spare parts, or tools delivered with 
        any piece of equipment, machinery, apparatus, or 
        vehicle that form part of its standard equipment shall 
        be treated as having the same origin as that equipment, 
        machinery, apparatus, or vehicle if the quantities and 
        values of such accessories, spare parts, or tools are 
        customary for the equipment, machinery, apparatus, or 
        vehicle.
    (b) Transshipment.--Goods exported from the territory of 
one Party originate in the territory of that Party only if--
          (1) the goods meet the applicable requirements of 
        subsection (a) and are shipped to the territory of the 
        other Party without having entered the commerce of any 
        third country;
          (2) the goods, if shipped through the territory of a 
        third country, do not undergo any operation other than 
        unloading, reloading, or any operation necessary to 
        transport them to the territory of the other Party or 
        to preserve them in good condition; and
          (3) the documents related to the exportation and 
        shipment of the goods from the territory of a Party 
        show the territory of the other Party as their final 
        destination.
    (c) Interpretation.--In interpreting this section, the 
following apply:
          (1) Whenever the processing or assembly of goods in 
        the territory of either Party or both Parties results 
        in one of the changes in tariff classification 
        described in the Annex rules, such goods shall be 
        considered to have been transformed in the territory of 
        that Party and shall be treated as goods originating in 
        the territory of that Party if--
                  (A) such processing or assembly occurs 
                entirely within the territory of either Party 
                or both Parties; and
                  (B) such goods have not subsequently 
                undergone any processing or assembly outside 
                the territories of the Parties that improves 
                the goods in condition or advances them in 
                value.
          (2) Whenever the assembly of goods in the territory 
        of a Party fails to result in a change of tariff 
        classification because either--
                  (A) the goods were imported into the 
                territory of the Party in an unassembled or a 
                disassembled form and were classified as 
                unassembled or disassembled goods pursuant to 
                General Rule of Interpretation 2(a) of the 
                Harmonized System; or
                  (B) the tariff subheading for the goods 
                provides for both the goods themselves and 
                their parts;
        such goods shall not be treated as goods originating in 
        the territory of a Party.
          (3) Notwithstanding paragraph (2), goods described in 
        that paragraph shall be considered to have been 
        transformed in the territory of a Party and be treated 
        as goods originating in the territory of the Party if--
                  (A) the value of materials originating in the 
                territory of either Party or both Parties used 
                or consumed in the production of the goods plus 
                the direct cost of assembling the goods in the 
                territory of either Party or both Parties 
                constitute not less than 50 percent of the 
                value of the goods when exported to the 
                territory of the other Party; and
                  (B) the goods have not subsequent to assembly 
                undergone processing or further assembly in a 
                third country and they meet the requirements of 
                subsection (b).
          (4) The provisions of paragraph (3) shall not apply 
        to goods of chapters 61-63 of the Harmonized System.
          (5) In making the determination required by paragraph 
        (3)(A) and in making the same or a similar 
        determination when required by the Annex rules, where 
        materials originating in the territory of either Party 
        or both Parties and materials obtained or produced in a 
        third country are used or consumed together in the 
        production of goods in the territory of a Party, the 
        value of materials originating in the territory of 
        either Party or both Parties may be treated as such 
        only to the extent that it is directly attributable to 
        the goods under consideration.
          (6) In applying the Annex rules, a specific rule 
        shall take precedence over a more general rule.
    (d) Annex Rules.--
          (1) The President is authorized to proclaim, as a 
        part of the Harmonized System, the rules set forth 
        under the heading ``Rules'' in Annex 301.2 of the 
        Agreement. For purposes of carrying out this 
        paragraph--
                  (A) the phrase ``headings 2207-2209'' in 
                paragraph 7 of section IV of such Annex 301.2 
                shall be treated as a reference to headings 
                2203-2209; and
                  (B) the phrase ``any other heading'' in 
                paragraph 11 of section XV in such Annex 301.2 
                shall be treated as a reference to any other 
                heading of chapter 74 of the Harmonized System.
          (2) Subject to the consultation and lay-over 
        requirements of section 103, the President is 
        authorized to proclaim such modifications to the rules 
        as may from time-to-time be agreed to by the United 
        States and Canada.
    (e) Automotive Products.--
          (1) The President is authorized to proclaim such 
        modifications to the definition of Canadian articles 
        (relating to the administration of the Automotive 
        Products Trade Act of 1965) in the general notes of the 
        Harmonized System as may be necessary to conform that 
        definition with chapter 3 of the Agreement.
          (2) For purposes of administering the value 
        requirement (as defined in section 304(c)(3)) with 
        respect to vehicles, the Secretary of the Treasury 
        shall prescribe regulations governing the averaging of 
        the value content of vehicles of the same class, or of 
        sister vehicles, assembled in the same plant as an 
        alternative to the calculation of the value content of 
        each vehicle.
    (f) Definitions.--For purposes of this section:
          (1) The term ``Annex'' means--
                  (A) the interpretative guidelines set forth 
                in subsection (c); and
                  (B) the Annex rules.
          (2) The term ``Annex rules'' means the rules 
        proclaimed under subsection (d).
          (3) The term ``direct cost of processing or direct 
        cost of assembling'' means the costs directly incurred 
        in, or that can reasonably be allocated to, the 
        production of goods, including--
                  (A) the cost of all labor, including benefits 
                and on-the-job training, labor provided in 
                connection with supervision, quality control, 
                shipping, receiving, storage, packaging, 
                management at the location of the process or 
                assembly, and other like labor, whether 
                provided by employees or independent 
                contractors;
                  (B) the cost of inspecting and testing the 
                goods;
                  (C) the cost of energy, fuel, dies, molds, 
                tooling, and the depreciation and maintenance 
                of machinery and equipment, without regard to 
                whether they originate within the territory of 
                a Party;
                  (D) development, design, and engineering 
                costs;
                  (E) rent, mortgage interest, depreciation on 
                buildings, property insurance premiums, 
                maintenance, taxes and the cost of utilities 
                for real property used in the production of 
                goods; and
                  (F) royalty, licensing, or other like 
                payments for the right to the goods;
        but not including--
                          (i) costs relating to the general 
                        expense of doing business, such as the 
                        cost of providing executive, financial, 
                        sales, advertising, marketing, 
                        accounting and legal services, and 
                        insurance;
                          (ii) brokerage charges relating to 
                        the importation and exportation of 
                        goods;
                          (iii) the costs for telephone, mail, 
                        and other means of communication;
                          (iv) packing costs for exporting the 
                        goods;
                          (v) royalty payments related to a 
                        licensing agreement to distribute or 
                        sell the goods;
                          (vi) rent, mortgage interest, 
                        depreciation on buildings, property 
                        insurance premiums, maintenance, taxes, 
                        and the cost of utilities for real 
                        property used by personnel charged with 
                        administrative functions; or
                          (vii) profit on the goods.
          (4) The term ``goods wholly obtained or produced in 
        the territory of either Party or both Parties'' means--
                  (A) mineral goods extracted in the territory 
                of either Party or both Parties;
                  (B) goods harvested in the territory of 
                either Party or both Parties;
                  (C) live animals born and raised in the 
                territory of either Party or both Parties;
                  (D) goods (fish, shellfish, and other marine 
                life) taken from the sea by vessels registered 
                or recorded with a Party and flying its flag;
                  (E) goods produced on board factory ships 
                from the goods referred to in subparagraph (D) 
                provided such factory ships are registered or 
                recorded with that Party and fly its flag;
                  (F) goods taken by a Party or a person of a 
                Party from the seabed or beneath the seabed 
                outside territorial waters, provided that Party 
                has rights to exploit such seabed;
                  (G) goods taken from space, provided they are 
                obtained by a Party or a person of a Party and 
                not processed in a third country;
                  (H) waste and scrap derived from 
                manufacturing operations and used goods, 
                provided they were collected in the territory 
                of either Party or both Parties and are fit 
                only for the recovery of raw materials; and
                  (I) goods produced in the territory of either 
                Party or both Parties exclusively from goods 
                referred to in subparagraphs (A) to (H) 
                inclusive or from their derivatives, at any 
                stage of production.
          (5) The term ``materials'' means goods, other than 
        those included as part of the direct cost of processing 
        or assembling, used or consumed in the production of 
        other goods.
          (6) The term ``Party'' means Canada or the United 
        States.
          (7) The term ``territory'' means--
                  (A) with respect to Canada, the territory to 
                which its customs laws apply, including any 
                areas beyond the territorial seas of Canada 
                within which, in accordance with international 
                law and its domestic laws, Canada may exercise 
                rights with respect to the seabed and subsoil 
                and their natural resources; and
                  (B) with respect to the United States--
                          (i) the customs territory of the 
                        United States, which includes the fifty 
                        States, the District of Columbia and 
                        the Commonwealth of Puerto Rico,
                          (ii) the foreign trade zones located 
                        in the United States, and the 
                        Commonwealth of Puerto Rico, and
                          (iii) any area beyond the territorial 
                        seas of the United States within which, 
                        in accordance with international law 
                        and its domestic laws, the United 
                        States may exercise rights with respect 
                        to the seabed and subsoil and their 
                        natural resources.
          (8) The term ``third country'' means any country 
        other than Canada or the United States or any territory 
        not a part of the territory of either.
          (9) The term ``value of materials originating in the 
        territory of either Party or both Parties'' means the 
        aggregate of--
                  (A) the price paid by the producer of an 
                exported good for materials originating in the 
                territory of either Party or both Parties or 
                for materials imported from a third country 
                used or consumed in the production of such 
                originating materials; and
                  (B) when not included in that price, the 
                following costs related thereto--
                          (i) freight, insurance, packing, and 
                        all other costs incurred in 
                        transporting any of the materials 
                        referred to in subparagraph (A) to the 
                        location of the producer;
                          (ii) duties, taxes, and brokerage 
                        fees on such materials paid in the 
                        territory of either Party or both 
                        Parties;
                          (iii) the cost of waste or spoilage 
                        resulting from the use or consumption 
                        of such materials, less the value of 
                        renewable scrap or byproduct; and
                          (iv) the value of goods and services 
                        relating to such materials determined 
                        in accordance with subparagraph 1(b) of 
                        article 8 of the Agreement on 
                        Implementation of article VII of the 
                        General Agreement on Tariffs and Trade.
          (10) The term ``value of the goods when exported to 
        the territory of the other Party'' means the aggregate 
        of--
                  (A) the price paid by the producer for all 
                materials, whether or not the materials 
                originate in either Party or both Parties, and, 
                when not included in the price paid for the 
                materials, the costs related to--
                          (i) freight, insurance, packing, and 
                        all other costs incurred in 
                        transporting all materials to the 
                        location of the producer;
                          (ii) duties, taxes, and brokerage 
                        fees on all materials paid in the 
                        territory of either Party or both 
                        Parties;
                          (iii) the cost of waste or spoilage 
                        resulting from the use or consumption 
                        of such materials, less the value of 
                        renewable scrap or byproduct; and
                          (iv) the value of goods and services 
                        relating to all materials determined in 
                        accordance with subparagraph 1(b) of 
                        article 8 of the Agreement on 
                        Implementation of article VII of the 
                        General Agreement on Tariffs and Trade; 
                        and
                  (B) the direct cost of processing or the 
                direct cost of assembling the goods.
  (g) Special Provision Regarding Application of Rules of 
Origin to Certain Apparel.--The Secretary of Commerce is 
authorized to issue regulations governing the exportation to 
Canada of apparel products that are cut, or knit to shape, and 
sewn, or otherwise assembled, in either Party from fabric 
produced or obtained in a third country for the purpose of 
establishing which exports of such products shall be permitted 
to claim preferential tariff treatment under the rules of 
origin of the Agreement, to the extent that the Agreement 
provides for quantitative limits on the availability of 
preferential tariff treatment for such products.

[SEC. 203. CUSTOMS USER FEES.

    [Amendment to section 13031(b) of the Consolidated Omnibus 
Reconciliation Act of 1985.]

[SEC. 204. DRAWBACK.

  [(a) Definition.--Suspended, as provided in section 501(c)(3) 
(reprinted elsewhere).]
  [(b) Implementation of Article 404.--Suspended, as provided 
in section 501(c)(3).]
  [(c) Consequential Amendments.--Amendments to sections 311, 
312 of the Tariff Act of 1930,
amendments adding subsections (n) and (o) to section 313 of the 
Tariff Act of 1930 concerning drawback, amendments to section 
562 of the Tariff Act of 1930, and amendment to section 3(a) of 
the Act of June 18, 1934, the Foreign Trade Zones Act 
(reprinted elsewhere).]

SEC. 205. ENFORCEMENT.

  [(a) Certifications of Origin.--Suspended, as provided in 
section 501(c)(3).]
  [(b) Recordkeeping Requirements.--Amendments to section 508 
of the Tariff Act of 1930.]

SEC. 206. EXEMPTION FROM LOTTERY TICKET EMBARGO.

  Section 305(a) of the Tariff Act of 1930 (19 U.S.C. 1305(a)) 
is amended by striking out the period at the end of the first 
paragraph and inserting the following: ``: Provided further, 
That effective January 1, 1993, this section shall not apply to 
any lottery ticket, printed paper that may be used as a lottery 
ticket, or advertisement of any lottery, that is printed in 
Canada for use in connection with a lottery conducted in the 
United States.''.
    [Section 484H(a) of the Customs and Trade Act of 1990 adds 
the following new subsection to section 553 of the Tariff Act 
of 1930 (19 U.S.C. 1553):
    [(b) Notwithstanding subsection (a), the entry for 
transportation in bond through the United States of any lottery 
ticket, printed paper that may be used as a lottery ticket, or 
any advertisement of any lottery, that is printed in Canada, 
shall be permitted without appraisement or the payment of 
duties under such regulations as the Secretary of the Treasury 
may prescribe, except that such regulations shall not permit 
the transportation of lottery materials in the personal baggage 
of a traveler.]

SEC. 207. PRODUCTION-BASED DUTY REMISSION PROGRAMS WITH RESPECT TO 
                    AUTOMOTIVE PRODUCTS.

  (a) USTR Study.--The United States Trade Representative 
shall--
          (1) undertake a study to determine whether any of the 
        production-based duty remission programs of Canada with 
        respect to automotive products is either--
                  (A) inconsistent with the provisions of, or 
                otherwise denies the benefits to the United 
                States under, the General Agreement on Tariffs 
                and Trade, or
                  (B) being implemented inconsistently with the 
                obligations under article 1002 of the Agreement 
                not--
                          (i) to expand the extent or the 
                        application, or
                          (ii) to extend the duration,
                of such programs; and
          (2) determine whether to initiate an investigation 
        under section 302 of the Trade Act of 1974 with respect 
        to any of such production-based duty remission 
        programs.
  (b) Report and Monitoring.--
          (1) The United States Trade Representative shall 
        submit a report to Congress no later than June 30, 1989 
        (or no later than September 30, 1989, if the Trade 
        Representative considers an extension to be necessary) 
        containing--
                  (A) the results of the study under subsection 
                (a)(1), as well as a description of the basis 
                used for measuring and verifying compliance 
                with the obligations referred to in subsection 
                (a)(1)(B); and
                  (B) any determination made under subsection 
                (a)(2) and the reasons therefor.
          (2) Notwithstanding the submission of the report 
        under paragraph (1), the Trade Representative shall 
        continue to monitor the degree of compliance with the 
        obligations referred to in subsection (a)(1)(B).

      TITLE III--APPLICATION OF AGREEMENT TO SECTORS AND SERVICES


SEC. 301. AGRICULTURE.

  (a) Special Tariff Provisions for Fresh Fruits and 
Vegetables.--
          (1) The Secretary of Agriculture (hereafter in this 
        section referred to as the ``Secretary'') may recommend 
        to the President the imposition of a temporary duty on 
        any Canadian fresh fruit or vegetable entered into the 
        United States if the Secretary determines that both of 
        the following conditions exist at the time that 
        imposition of the duty is recommended:
                  (A) For each of 5 consecutive working days 
                the import price of the Canadian fresh fruit or 
                vegetable is below 90 percent of the 
                corresponding 5-year average monthly import 
                price for such fruit or vegetable.
                  (B) The planted acreage in the United States 
                for the like fresh fruit or vegetable is no 
                higher than the average planted acreage over 
                the preceding 5 years, excluding the years with 
                the highest and lowest acreage. For the 
                purposes of applying this subparagraph, any 
                acreage increase attributed directly to a 
                reduction in the acreage that was planted to 
                wine grapes as of October 4, 1987, shall be 
                excluded.
        Whenever the Secretary makes a determination that the 
        conditions referred to in subparagraphs (A) and (B) 
        regarding any Canadian fresh fruit or vegetable exist, 
        the Secretary shall immediately submit for publication 
        in the Federal Register notice of the determination.
          (2) No later than 6 days after publication in the 
        Federal Register of the notice described in paragraph 
        (1), the Secretary shall decide whether to recommend 
        the imposition of a temporary duty to the President, 
        and if the Secretary decides to make such a 
        recommendation, the recommendation shall be forwarded 
        immediately to the President.
          (3) In determining whether to recommend the 
        imposition of a temporary duty to the President under 
        paragraph (1), the Secretary shall consider whether the 
        conditions in subparagraphs (A) and (B) of such 
        paragraph have led to a distortion in trade between the 
        United States and Canada of the fresh fruit or 
        vegetable and, if so, whether the imposition of the 
        duty is appropriate, including consideration of whether 
        it would significantly correct this distortion.
          (4) Not later than 7 days after receipt of a 
        recommendation of the Secretary under paragraph (1), 
        the President, after taking into account the national 
        economic interests of the United States, shall 
        determine whether to impose a temporary duty on the 
        Canadian fresh fruit or vegetable concerned. If the 
        determination is affirmative, the President shall 
        proclaim the imposition and the rate of the temporary 
        duty, but such duty shall not apply to the entry of 
        articles that were in transit to the United States on 
        the first day on which the temporary duty is in effect.
          (5) A temporary duty imposed under paragraph (4) 
        shall cease to apply with respect to articles that are 
        entered on or after the earlier of--
                  (A) the day following the last of 5 
                consecutive working days with respect to which 
                the Secretary determines that the point of 
                shipment price in Canada for the Canadian fruit 
                or vegetable concerned exceeds 90 percent of 
                the corresponding 5-year average monthly import 
                price; or
                  (B) the 180th day after the date on which the 
                temporary duty first took effect.
          (6) No temporary duty may be imposed under this 
        subsection on a Canadian fresh fruit or vegetable 
        during such time as import relief is provided with 
        respect to such fresh fruit or vegetable under chapter 
        1 of title II of the Trade Act of 1974.
          (7) For purposes of this subsection:
                  (A) The term ``Canadian fresh fruit or 
                vegetable'' means any article originating in 
                Canada (as determined in accordance with 
                section 202) and classified within any of the 
                following headings of the Harmonized System:
                          (i) 07.01 (relating to potatoes, 
                        fresh or chilled);
                          (ii) 07.02 (relating to tomatoes, 
                        fresh or chilled);
                          (iii) 07.03 (relating to onions, 
                        shallots, garlic, leeks and other 
                        alliaceous vegetables, fresh or 
                        chilled);
                          (iv) 07.04 (relating to cabbages, 
                        cauliflowers, kohlrabi, kale and 
                        similar edible brassicas, fresh or 
                        chilled);
                          (v) 07.05 (relating to lettuce 
                        (lactuca sativa) and chicory (cichorium 
                        spp.), fresh or chilled);
                          (vi) 07.06 (relating to carrots, 
                        salad beets or beetroot, salsify, 
                        celeriac, radishes and similar edible 
                        roots (excluding turnips), fresh or 
                        chilled);
                          (vii) 07.07 (relating to cucumbers 
                        and gherkins, fresh or chilled);
                          (viii) 07.08 (relating to leguminous 
                        vegetables, shelled or unshelled, fresh 
                        or chilled);
                          (ix) 07.09 (relating to other 
                        vegetables (excluding truffles), fresh 
                        or chilled);
                          (x) 08.06.10 (relating to grapes, 
                        fresh);
                          (xi) 08.08.20 (relating to pears and 
                        quinces, fresh);
                          (xii) 08.09 (relating to apricots, 
                        cherries, peaches (including 
                        nectarines), plums and sloes, fresh); 
                        and
                          (xiii) 08.10 (relating to other fruit 
                        (excluding cranberries and 
                        blueberries), fresh).
                  (B) The term ``corresponding 5-year average 
                monthly import price'' for a particular day 
                means the average import price of a Canadian 
                fresh fruit or vegetable, for the calendar 
                month in which that day occurs, for that month 
                in each of the preceding 5 years, excluding the 
                years with the highest and lowest monthly 
                averages.
                  (C) The term ``import price'' has the meaning 
                given such term in article 711 of the 
                Agreement.
                  (D) The rate of a temporary duty imposed 
                under this subsection with respect to a 
                Canadian fresh fruit or vegetable means a rate 
                that, including the rate of any other duty in 
                effect for such fruit or vegetable, does not 
                exceed the lesser of--
                          (i) the duty that was in effect for 
                        the fresh fruit or vegetable before 
                        January 1, 1989, under column one of 
                        the Tariff Schedules of the United 
                        States for the applicable season in 
                        which the temporary duty is applied; or
                          (ii) the duty in effect for the fresh 
                        fruit or vegetable under column one of 
                        such Schedules, or column 1 (General) 
                        of the Harmonized System, at the time 
                        the temporary duty is applied.
          (8)(A) The Secretary shall, to the extent 
        practicable, administer the provisions of this 
        subsection to the 8-digit level of classification under 
        the Harmonized System.
          (B) The Secretary may issue such regulations as may 
        be necessary to implement the provisions of this 
        subsection.
          (9) For purposes of assisting the Secretary in 
        carrying out this subsection--
                  (A) the Commissioner of Customs and the 
                Director of the Bureau of Census shall 
                cooperate in providing the Secretary with 
                timely information and data relating to the 
                importation of Canadian fresh fruits and 
                vegetables, and
                  (B) importers shall report such information 
                relating to Canadian fresh fruits and 
                vegetables to the Commissioner of Customs at 
                such time and in such manner as the 
                Commissioner requires.
          (10) The authority to impose temporary duties under 
        this subsection expires on the 20th anniversary of the 
        date on which the Agreement enters into force.
  [(b) Meat Import Act of 1979.--Amendments to the Meat Import 
Act of 1979, repealed by section 403 of the Uruguay Round 
Agreements Act.]
  [(c) Agricultural Adjustment Act.--Amendment to section 22(f) 
of the Agricultural Adjustment Act, as reenacted with 
amendments by the Agricultural Marketing Agreement Act of 
1937.]
  [(d)-(f) Amendments to the Act of March 4, 1913, the Federal 
Seed Act, the Federal Plant Pest Act, the Act of August 20, 
1912, the Federal Noxious Weed Act of 1974, and section 306 of 
the Tariff Act of 1930.]

[SEC. 302. RELIEF FROM IMPORTS.

    [Suspended, as provided in section 501(c)(3).]

SEC. 303. ACTS IDENTIFIED IN NATIONAL TRADE ESTIMATES.

  With respect to any act, policy, or practice of Canada that 
is identified in the annual report submitted under section 181 
of the Trade Act of 1974 (19 U.S.C. 2241), the United States 
Trade Representative shall include--
          (1) information with respect to the action taken 
        regarding such act, policy, or practice, including but 
        not limited to--
                  (A) any action under section 301 of the Trade 
                Act of 1974 (including resolution through 
                appropriate dispute settlement procedures),
                  (B) any action under section 307 of the Trade 
                and Tariff Act of 1984, and
                  (C) negotiations or consultations, whether on 
                a bilateral or multilateral basis; or
          (2) the reasons that no action was taken regarding 
        such act, policy, or practice.

SEC. 304. NEGOTIATIONS REGARDING CERTAIN SECTORS; BIENNIAL REPORTS.

  (a) In General.--
          (1) The President is authorized to enter into 
        negotiations with the Government of Canada for the 
        purpose of concluding an agreement (including an 
        agreement amending the Agreement) or agreements to--
                  (A) liberalize trade in services in 
                accordance with article 1405 of the Agreement;
                  (B) liberalize investment rules;
                  (C) improve the protection of intellectual 
                property rights;
                  (D) increase the value requirement applied 
                for purposes of determining whether an 
                automotive product is treated as originating in 
                Canada or the United States; and
                  (E) liberalize government procurement 
                practices, particularly with regard to 
                telecommunications.
          (2) As an exercise of the foreign relations powers of 
        the President under the Constitution, the President 
        will enter into immediate consultations with the 
        Government of Canada to obtain the exclusion from the 
        transport rates established under Canada's Western 
        Grain Transportation Act of agricultural goods that 
        originate in Canada and are shipped via east coast 
        ports for consumption in the United States.
  (b) Negotiating Objectives Regarding Services, Investment, 
and Intellectual Property Rights.--
          (1) The objectives of the United States in 
        negotiations conducted under subsection (a)(1)(A) to 
        liberalize trade in services include--
                  (A) with respect to developing services 
                sectors not covered in the Agreement, the 
                elimination of those tariff, nontariff, and 
                subsidy trade distortions that have potential 
                to affect significant bilateral trade;
                  (B) the elimination or reduction of measures 
                grandfathered by the Agreement that deny or 
                restrict national treatment in the provision of 
                services;
                  (C) the elimination of local presence 
                requirements; and
                  (D) the liberalization of government 
                procurement of services.
        In conducting such negotiations, the President shall 
        consult with the services advisory committees 
        established under section 135 of the Trade Act of 1974 
        (19 U.S.C. 2155).
          (2) The objectives of the United States in any 
        negotiations conducted under subsection (a)(1)(B) to 
        liberalize investment rules include--
                  (A) the elimination of direct investment 
                screening;
                  (B) the extension of the principles of the 
                Agreement to energy and cultural industries, to 
                the extent such industries are not currently 
                covered by the Agreement;
                  (C) the elimination of technology transfer 
                requirements and other performance requirements 
                not currently barred by the Agreement; and
                  (D) the subjection of all investment disputes 
                to dispute resolution under chapter 18 of the 
                Agreement.
        In conducting such negotiations, the President shall 
        consult with persons representing diverse interests in 
        the United States in investment.
          (3) The objectives of the United States in any 
        negotiations conducted under subsection (a)(1)(C) to 
        improve the protection of intellectual property rights 
        include--
                  (A) the recognition and adequate protection 
                of intellectual property, including copyrights, 
                patents, process patents, trademarks, mask 
                works, and trade secrets; and
                  (B) the establishment of dispute resolution 
                procedures and binational enforcement of 
                intellectual property standards.
        In conducting such negotiations, the President shall 
        consult with persons representing diverse interests in 
        the United States in intellectual property.
  (c) Negotiating Objectives Regarding Automotive Products.--
          (1) In conducting negotiations under subsection 
        (a)(1)(D) regarding the value requirement for 
        automotive products, the President shall seek to 
        conclude an agreement by no later than January 1, 1990, 
        to increase the value requirement from 50 percent to at 
        least 60 percent.
          (2) The President is authorized, through January 1, 
        1999, to proclaim any agreed increase in the value 
        requirement.
          (3) As used in this section, the term ``value 
        requirement'' means the minimum percentage of the value 
        of an automotive product that must be accounted for by 
        the value of the materials in the product that 
        originated in the United States or Canada, or both, 
        plus the direct cost of processing or assembly 
        performed in the United States or Canada, or both, with 
        respect to the product.
  (d) Negotiation of Limitation on Potato Trade.--
          (1) During the 5-year period beginning on the date of 
        enactment of this Act, the President is authorized to 
        enter into negotiations with Canada for the purpose of 
        obtaining an agreement to limit the exportation and 
        importation of all potatoes between the United States 
        and Canada, including seed potatoes, fresh, chilled or 
        frozen potatoes, dried, desiccated or dehydrated 
        potatoes, and potatoes otherwise prepared or preserved. 
        Any agreement negotiated under this subsection shall 
        provide for an annual limitation divided equally into 
        each half of the year.
          (2) For the purpose of conducting negotiations under 
        paragraph (1), the Secretary of Agriculture and the 
        United States Trade Representative shall consult with 
        representatives of the potato producing industry, 
        including the Ad Hoc Potato Advisory Group and the 
        United States/Canada Horticultural Industry Advisory 
        Committee, to solicit their views on negotiations with 
        Canada for reciprocal quantitative limits on the potato 
        trade.
          (3) The President is authorized to direct the 
        Secretary of the Treasury to--
                  (A) carry out such actions as may be 
                necessary or appropriate to ensure the 
                attainment of the objectives of any agreement 
                that is entered into under this section; and
                  (B) enforce any quantitative limitation, 
                restriction, and other terms contained in the 
                agreement.
        Such actions may include, but are not limited to, 
        requirements that valid export licenses or other 
        documentation issued by a foreign government be 
        presented as a condition for the entry into the United 
        States of any article that is subject to the agreement.
          (4) The provisions of section 1204 of the Agriculture 
        and Food Act of 1981 (7 U.S.C. 1736j) and the last 
        sentence of section 812 of the Agricultural Act of 1970 
        (7 U.S.C. 612c-3) shall not apply in the case of 
        actions taken pursuant to this subsection.
  (e) Canadian Controls on Fish.--
          (1) Within 30 days of the application by Canada of 
        export controls on unprocessed fish under statutes 
        exempted from the Agreement under article 1203, or the 
        application of landing requirements for fish caught in 
        Canadian waters, the President shall take appropriate 
        action to enforce United States rights under the 
        General Agreement on Tariffs and Trade that are 
        retained in article 1205 of the Agreement.
          (2) In enforcing the United States rights referred to 
        in paragraph (1), the President has discretion to--
                  (A) bring a challenge to the offending 
                Canadian practices before the GATT;
                  (B) retaliate against such offending 
                practices;
                  (C) seek resolution directly with Canada;
                  (D) refer the matter for dispute resolution 
                to the Canada-United States Trade Commission; 
                or
                  (E) take other action that the President 
                considers appropriate to enforce such United 
                States rights.
  [(f) Biennial Report.--Suspended as provided in section 
501(c)(3).]

[SEC. 305. ENERGY.

  [(a) Alaskan Oil.--Amendment to section 7(d)(1) of the Export 
Administration Act of 1979.]
  [(b) Uranium.--Amendment to section 161(v) of the Atomic 
Energy Act of 1954.]

[SEC. 306. LOWERED THRESHOLD FOR GOVERNMENT PROCUREMENT UNDER TRADE 
                    AGREEMENTS ACT OF 1979 IN THE CASE OF CERTAIN 
                    CANADIAN PRODUCTS.

[Amendment adding subparagraph (D) to section 308(4) of the 
Trade Agreements Act of 1979 (reprinted elsewhere).]

[SEC. 307. TEMPORARY ENTRY FOR BUSINESS PERSONS.

[Provisions relating to, and amendments of, the Immigration and 
Nationality Act.]

[SEC. 308. AMENDMENT TO SECTION 5136 OF THE REVISED STATUTES.]

SEC. 309. STEEL PRODUCTS.

  Nothing in this Act shall preclude any discussion or 
negotiation between the United States and Canada in order to 
conclude voluntary restraint agreements or mutually agreed 
quantitative restrictions on the volume of steel products 
entering the United States from Canada.

   TITLE IV--BINATIONAL PANEL DISPUTE SETTLEMENT IN ANTIDUMPING AND 
                       COUNTERVAILING DUTY CASES


[SEC. 401. AMENDMENTS TO SECTION 516A OF THE TARIFF ACT OF 1930.

Amendments to section 516A of the Tariff Act of 1930 to 
establish procedures for binational panel review of certain 
antidumping and countervailing duty determinations (reprinted 
elsewhere).]

[SEC. 402. AMENDMENTS TO TITLE 28, UNITED STATES CODE.]

[SEC. 403. CONFORMING AMENDMENTS TO THE TARIFF ACT OF 1930.

Amendments to sections 502(b), 514(b), 771, and 777 of the 
Tariff Act of 1930 (reprinted elsewhere).]

[SEC. 404. AMENDMENTS TO ANTIDUMPING AND COUNTERVAILING DUTY LAW.

Suspended, as provided in section 501(c)(3) (reprinted 
elsewhere).]

SEC. 405. ORGANIZATIONAL AND ADMINISTRATIVE PROVISIONS REGARDING THE 
                    IMPLEMENTATION OF CHAPTERS 18 AND 19 OF THE 
                    AGREEMENT.

  (a) Appointment of Individuals to Panels and Committees.--
          (1)(A) There is established within the interagency 
        organization established under section 242 of the Trade 
        Expansion Act of 1962 (19 U.S.C. 1872) an interagency 
        group which shall--
                  (i) be chaired by the United States Trade 
                Representative (hereafter in this section 
                referred to as the ``Trade Representative''), 
                and
                  (ii) consist of such officers (or the 
                designees thereof) of the Government of the 
                United States as the Trade Representative 
                considers appropriate.
          (B) The interagency group established under 
        subparagraph (A) shall, in a manner consistent with 
        chapter 19 of the Agreement--
                  (i) prepare by January 3 of each calendar 
                year--
                          (I) a list of individuals who are 
                        qualified to serve as members of 
                        binational panels convened under 
                        chapter 19 of the Agreement, and
                          (II) a list of individuals who are 
                        qualified to serve on extraordinary 
                        challenge committees convened under 
                        such chapter,
                  (ii) if the Trade Representative makes a 
                request under paragraph (5)(A)(i) with respect 
                to a final candidate list during any calendar 
                year, prepare by July 1 of such calendar year a 
                list of those individuals who are qualified to 
                be added to that final candidate list,
                  (iii) exercise oversight of the 
                administration of the United States Secretariat 
                that is authorized to be established under 
                subsection (e), and
                  (iv) make recommendations to the Trade 
                Representative regarding the convening of 
                extraordinary challenge committees under 
                chapter 19 of the Agreement.
          (2)(A) The Trade Representative shall select 
        individuals from the respective lists prepared by the 
        interagency group under paragraph (1)(B)(i) for 
        placement on a preliminary candidate list of 
        individuals eligible to serve as members of binational 
        panels under Annex 1901.2 of the Agreement and a 
        preliminary candidate list of individuals eligible for 
        selection as members of extraordinary challenge 
        committees under Annex 1904.13 of the Agreement.
          (B) The selection of individuals for--
                  (i) placement on lists prepared by the 
                interagency group under clause (i) or (ii) of 
                paragraph (1)(B),
                  (ii) placement on preliminary candidate lists 
                under subparagraph (A),
                  (iii) placement on final candidate lists 
                under paragraph (3),
                  (iv) placement by the Trade Representative on 
                the rosters described in Annex 1901.2(1) and 
                Annex 1904.13(1) of the Agreement, and
                  (v) appointment by the Trade Representative 
                for service on binational panels and 
                extraordinary challenge committees convened 
                under chapter 19 of the Agreement,
        shall be made on the basis of the criteria provided in 
        Annex 1901.2(1) and Annex 1904.13(1) of the Agreement 
        and shall be made without regard to political 
        affiliation.
          (C) For purposes of applying section 1001 of title 
        18, United States Code, the written or oral responses 
        of individuals to inquiries of the interagency group 
        established under paragraph (1) or the Trade 
        Representative regarding their personal and 
        professional qualifications, and financial and other 
        relevant interests, that bear on their suitability for 
        the placements and appointments described in 
        subparagraph (B), shall be treated as matters within 
        the jurisdiction of an agency of the United States.
          (3)(A) By no later than January 3 of each calendar 
        year, the Trade Representative shall submit to the 
        Committee on Finance of the Senate and the Committee on 
        Ways and Means of the House of Representatives 
        (hereafter in this section referred to as the 
        ``appropriate Congressional Committees'') the 
        preliminary candidate lists of those individuals 
        selected by the Trade Representative under paragraph 
        (2)(A) to be candidates eligible to serve on binational 
        panels or extraordinary challenge committees convened 
        pursuant to chapter 19 of the Agreement during the 1-
        year period beginning on April 1 of such calendar year.
          (B) Upon submission of the preliminary candidate 
        lists under subparagraph (A) to the appropriate 
        Congressional Committees, the Trade Representative 
        shall consult with the appropriate Congressional 
        Committees with regard to the individuals listed on the 
        preliminary candidate lists.
          (C) The Trade Representative may add or delete 
        individuals from the preliminary candidate lists 
        submitted under subparagraph (A) after consulting the 
        appropriate Congressional Committees with regard to 
        such addition or deletion. The Trade Representative 
        shall provide to the appropriate Congressional 
        Committees written notice of any addition or deletion 
        of an individual from the preliminary candidate lists.
          (4)(A) By no later than March 31 of each calendar 
        year, the Trade Representative shall submit to the 
        appropriate Congressional Committees the final 
        candidate lists of those individuals selected by the 
        Trade Representative to be candidates eligible to serve 
        on binational panels and extraordinary challenge 
        committees convened pursuant to chapter 19 of the 
        Agreement during the 1-year period beginning on April 1 
        of such calendar year. An individual may be included on 
        a final candidate list only if written notice of the 
        addition of such individual to the preliminary 
        candidate list was submitted to the appropriate 
        Congressional Committees at least 15 days before the 
        date on which that final candidate list is submitted to 
        the appropriate Congressional Committees under this 
        subparagraph.
          (B) Except as provided in paragraph (5), no additions 
        may be made to the final candidate lists after the 
        final candidate lists are submitted to the appropriate 
        Congressional Committees under subparagraph (A).
          (5)(A) If, after the Trade Representative has 
        submitted the final candidate lists to the appropriate 
        Congressional Committees under paragraph (4)(A) for a 
        calendar year and before July 1 of such calendar year, 
        the Trade Representative determines that additional 
        individuals need to be added to a final candidate list, 
        the Trade Representative shall--
                  (i) request the interagency group established 
                under paragraph (1)(A) to prepare a list of 
                individuals who are qualified to be added to 
                such candidate list,
                  (ii) select individuals from the list 
                prepared by the interagency group under 
                paragraph (1)(B)(ii) to be included in a 
                proposed amendment to such final candidate 
                list, and
                  (iii) by no later than July 1 of such 
                calendar year, submit to the appropriate 
                Congressional Committees the proposed 
                amendments to such final candidate list 
                developed by the Trade Representative under 
                clause (ii).
          (B) Upon submission of a proposed amendment under 
        subparagraph (A)(iii) to the appropriate Congressional 
        Committees, the Trade Representative shall consult with 
        the appropriate Congressional Committees with regard to 
        the individuals included in the proposed amendment.
          (C) The Trade Representative may add or delete 
        individuals from any proposed amendment submitted under 
        subparagraph (A)(iii) after consulting the appropriate 
        Congressional Committees with regard to such addition 
        or deletion. The Trade Representative shall provide to 
        the appropriate Congressional Committees written notice 
        of any addition or deletion of an individual from the 
        proposed amendment.
          (D)(i) If the Trade Representative submits under 
        subparagraph (A)(iii) in any calendar year a proposed 
        amendment to a final candidate list, the Trade 
        Representative shall, by no later than September 30 of 
        such calendar year, submit to the appropriate 
        Congressional Committees the final form of such 
        amendment. On October 1 of such calendar year, such 
        amendment shall take effect and the individuals 
        included in the final form of such amendment shall be 
        added to the final candidate list.
          (ii) An individual may be included in the final form 
        of an amendment submitted under clause (i) only if 
        written notice of the addition of such individual to 
        the proposed form of such amendment was submitted to 
        the appropriate Congressional Committees at least 15 
        days before the date on which the final form of such 
        amendment is submitted under clause (i).
          (iii) Individuals added to a final candidate list 
        under clause (i) shall be eligible to serve on 
        binational panels or extraordinary challenge committees 
        convened pursuant to chapter 19 of the Agreement, as 
        the case may be, during the 6-month period beginning on 
        October 1 of the calendar year in which such addition 
        occurs.
          (iv) No additions may be made to the final form of an 
        amendment described in clause (i) after the final form 
        of such amendment is submitted to the appropriate 
        Congressional Committees under clause (i).
          (6)(A) The Trade Representative is the only officer 
        of the Government of the United States authorized to 
        act on behalf of the Government of the United States in 
        making any selection or appointment of an individual 
        to--
                  (i) the rosters described in Annex 1901.2(1) 
                and Annex 1904.13(1) of the Agreement, or
                  (ii) the binational panels or extraordinary 
                challenge committees convened pursuant to 
                chapter 19 of the Agreement,
        that is to be made solely or jointly by the Government 
        of the United States under the terms of the Agreement.
          (B) Except as otherwise provided in paragraph (7)(B), 
        the Trade Representative may--
                  (i) select an individual for placement on the 
                rosters described in Annex 1901.2(1) and Annex 
                1904.13(1) of the Agreement during the 1-year 
                period beginning on April 1 of any calendar 
                year,
                  (ii) appoint an individual to serve as one of 
                those members of any binational panel or 
                extraordinary challenge committee convened 
                pursuant to chapter 19 of the Agreement during 
                such 1-year period who, under the terms of the 
                Agreement, are to be appointed solely by the 
                Government of the United States, or
                  (iii) act to make a joint appointment with 
                the Government of Canada, under the terms of 
                the Agreement, of any individual who is a 
                citizen or national of the United States to 
                serve as any other member of such a panel or 
                committee,
        only if such individual is on the appropriate final 
        candidate list that was submitted to the appropriate 
        Congressional Committees under paragraph (4)(A) during 
        such calendar year or on such list as it may be amended 
        under paragraph (5)(D)(i).
          (7)(A) Except as otherwise provided in this 
        paragraph, no individual may--
                  (i) be selected by the Government of the 
                United States for placement on the rosters 
                described in Annex 1901.2(1) and Annex 
                1904.13(1) of the Agreement, or
                  (ii) be appointed solely or jointly by the 
                Government of the United States to serve as a 
                member of a binational panel or extraordinary 
                challenge committee convened pursuant to 
                chapter 19 of the Agreement,
        during the 1-year period beginning on April 1 of any 
        calendar year for which the Trade Representative has 
        not met the requirements of this subsection.
          (B)(i) Notwithstanding paragraphs (3), (4), or (6)(B) 
        (other than paragraph (3)(A)), individuals listed on 
        the preliminary candidate lists submitted to the 
        appropriate Congressional Committees under paragraph 
        (3)(A) may--
                  (I) be selected by the Trade Representative 
                for placement on the rosters described in Annex 
                1901.2(1) and Annex 1904.13(1) of the Agreement 
                during the 3-month period beginning on the date 
                on which the Agreement enters into force, and
                  (II) be appointed solely or jointly by the 
                Trade Representative under the terms of the 
                Agreement to serve as members of binational 
                panels or extraordinary challenge committees 
                that are convened pursuant to chapter 19 of the 
                Agreement during such 3-month period.
          (ii) If the Agreement enters into force after January 
        3, 1989, the provisions of this subsection shall be 
        applied with respect to the calendar year in which the 
        Agreement enters into force--
                  (I) by substituting ``the date that is 30 
                days after the date on which the Agreement 
                enters into force'' for ``January 3 of each 
                calendar year'' in paragraphs (1)(B)(i) and 
                (3)(A), and
                  (II) by substituting ``the date that is 3 
                months after the date on which the Agreement 
                enters into force'' for ``March 31 of each 
                calendar year'' in paragraph (4)(A).
  (b) Status of Panelists.--Notwithstanding any other provision 
of law, individuals appointed by the United States to serve on 
panels or committees convened pursuant to chapter 19 of the 
Agreement, and individuals designated to assist such appointed 
individuals, shall not be considered to be employees or special 
employees of, or to be otherwise affiliated with, the 
Government of the United States.
  (c) Immunity of Panelists.--With the exception of acts 
described in section 777f(d)(3) of the Tariff Act of 1930, as 
added by this Act, individuals serving on panels or committees 
convened pursuant to chapter 19 of the Agreement, and 
individuals designated to assist the individuals serving on 
such panels or committees, shall be immune from suit and legal 
process relating to acts performed by such individuals in their 
official capacity and within the scope of their functions as 
such panelists or committee members or assistants to such 
panelists or committee members.
  (d) Regulations.--The administering authority under title VII 
of the Tariff Act of 1930, the United States International 
Trade Commission, and the United States Trade Representative 
may promulgate such regulations as are necessary or appropriate 
to carry out actions in order to implement their respective 
responsibilities under chapters 18 and 19 of the Agreement. 
Initial regulations to carry out such functions shall be issued 
prior to the date of entry into force of the Agreement.
  (e) Establishment of United States Secretariat.--
          (1) The President is authorized to establish within 
        any department or agency of the Federal Government a 
        United States Secretariat which, subject to the 
        oversight of the interagency group established under 
        subsection (a)(1)(A), shall facilitate--
                  (A) the operation of chapters 18 and 19 of 
                the Agreement, and
                  (B) the work of the binational panels and 
                extraordinary challenge committees convened 
                under chapters 18 and 19 of the Agreement.
          (2) The United States Secretariat established by the 
        President under paragraph (1) shall not be considered 
        to be an agency for purposes of section 552 of title 5, 
        United States Code.

SEC. 406. AUTHORIZATION OF APPROPRIATIONS FOR THE SECRETARIAT, THE 
                    PANELS, AND THE COMMITTEES.

  (a) The Secretariat.--There are authorized to be appropriated 
to the department or agency within which the United States 
Secretariat described in chapter 19 of the Agreement is 
established the lesser of--
          (1) such sums as may be necessary, or
          (2) $5,000,000,
for each fiscal year succeeding fiscal year 1988 for the 
establishment and operations of such United States Secretariat 
and for the payment of the United States share of the expenses 
of the dispute settlement proceedings under chapter 18 of the 
Agreement.
  (b) Panels and Committees.--
          (1) There are authorized to be appropriated to the 
        Office of the United States Trade Representative for 
        fiscal year 1990, $1,492,000 to pay during such fiscal 
        year the United States share of the expenses of 
        binational panels and extraordinary challenge 
        committees convened pursuant to chapter 19 of the 
        Agreement.
          (2) The United States Trade Representative is 
        authorized to transfer to any department or agency of 
        the United States, from sums appropriated pursuant to 
        the authorization provided under paragraph (1) or 
        section 141(g)(1) of the Trade Act of 1974, such funds 
        as may be necessary to facilitate the payment of the 
        expenses described in paragraph (1).
          (3) Funds appropriated for the payment of expenses 
        described in paragraph (1) during any fiscal year may 
        be expended only to the extent such funds do not exceed 
        the amount authorized to be appropriated under 
        paragraph (1) for such fiscal year. This paragraph 
        shall apply, notwithstanding any law enacted after the 
        date of enactment of this Act, unless such subsequent 
        law specifically provides that this paragraph shall not 
        apply and specifically cites this paragraph.
          (4) If the Canadian Secretariat described in chapter 
        19 of the Agreement provides funds during any fiscal 
        year for the purpose of paying, in accordance with 
        Annex 1901.2 of the Agreement, the Canadian share of 
        the expenses of binational panels, the United States 
        Secretariat established under section 405(e)(1) may 
        hereafter retain and use such funds for such purposes.

SEC. 407. TESTIMONY AND PRODUCTION OF PAPERS IN EXTRAORDINARY 
                    CHALLENGES.

  (a) Authority of Extraordinary Challenge Committee To Obtain 
Information.--If an extraordinary challenge committee 
(hereinafter referred to in this section as the ``committee'') 
is convened pursuant to article 1904(13) of the Agreement, and 
the allegations before the committee include a matter referred 
to in article 1904(13)(a)(i) of the Agreement, for the purposes 
of carrying out its functions and duties under Annex 1904.13 of 
the Agreement, the committee--
          (1) shall have access to, and the right to copy, any 
        document, paper, or record pertinent to the subject 
        matter under consideration, in the possession of any 
        individual, partnership, corporation, association, 
        organization, or other entity,
          (2) may summon witnesses, take testimony, and 
        administer oaths,
          (3) may require any individual, partnership, 
        corporation, association, organization, or other entity 
        to produce documents, books, or records relating to the 
        matter in question, and
          (4) may require any individual, partnership, 
        corporation, association, organization, or other entity 
        to furnish in writing, in such detail and in such form 
        as the committee may prescribe, information in its 
        possession pertaining to the matter.
Any member of the committee may sign subpoenas, and members of 
the committee, when authorized by the committee, may administer 
oaths and affirmations, examine witnesses, take testimony, and 
receive evidence.
  (b) Witnesses and Evidence.--The attendance of witnesses who 
are authorized to be summoned, and the production of 
documentary evidence authorized to be ordered, under subsection 
(a) may be required from any place in the United States at any 
designated place of hearing. In the case of disobedience to a 
subpoena authorized under subsection (a), the committee may 
request the Attorney General of the United States to invoke the 
aid of any district or territorial court of the United States 
in requiring the attendance and testimony of witnesses and the 
production of documentary evidence. Such court, within the 
jurisdiction of which such inquiry is carried on, may, in case 
of contumacy or refusal to obey a subpoena issued to any 
individual, partnership, corporation, association, 
organization, or other entity, issue an order requiring such 
individual or entity to appear before the committee, or to 
produce documentary evidence if so ordered or to give evidence 
concerning the matter in question. Any failure to obey such 
order of the court may be punished by such court as a contempt 
thereof.
  (c) Mandamus.--Any court referred to in subsection (b) shall 
have jurisdiction to issue writs of mandamus commanding 
compliance with the provisions of this section or any order of 
the committee made in pursuance thereof.
  (d) Depositions.--The committee may order testimony to be 
taken by deposition at any stage of the committee review. Such 
deposition may be taken before any person designated by the 
committee and having power to administer oaths. Such testimony 
shall be reduced to writing by the person taking the 
deposition, or under the direction of such person, and shall 
then be subscribed by the deponent. Any individual, 
partnership, corporation, association, organization or other 
entity may be compelled to appear and depose and to produce 
documentary evidence in the same manner as witnesses may be 
compelled to appear and testify and produce documentary 
evidence before the committee, as provided in this section.

SEC. 408. REQUESTS FOR REVIEW OF CANADIAN ANTIDUMPING AND 
                    COUNTERVAILING DUTY DETERMINATIONS.

  (a) Requests for Review by the United States.--In the case of 
a final antidumping or countervailing duty determination of a 
competent investigating authority of Canada, as defined in 
article 1911 of the Agreement, requests by the United States 
for binational panel review under article 1904 of the Agreement 
shall be made by the United States Secretary, described in 
article 1909(4) of the Agreement.
  (b) Requests for Review by a Person.--In the case of a final 
antidumping or countervailing duty determination of a competent 
investigating authority of Canada, as defined in article 1911 
of the Agreement, a person, within the meaning of article 
1904(5) of the Agreement, may request a binational panel review 
of such determination by filing with the United States 
Secretary, described in article 1909(4) of the Agreement, such 
a request within the time limit provided for in article 1904(4) 
of the Agreement. The receipt of such request by the United 
States Secretary shall be deemed to be a request for binational 
panel review within the meaning of article 1904(4) of the 
Agreement. Such request shall contain such information and be 
in such form, manner, and style as the administering authority 
shall prescribe by regulations. The request for such panel 
review shall not preclude the United States, Canada, or any 
other person from challenging before a binational panel the 
basis for a particular request for review.
  (c) Service of Request for Review.--Whenever binational panel 
review is requested under this section, the United States 
Secretary shall serve a copy of the request on all persons who 
would otherwise be entitled under Canadian law to commence 
procedures for judicial review of a final antidumping or 
countervailing duty determination made by a competent 
investigating authority of Canada.

[SEC. 409. SUBSIDIES.

    Suspended, as provided in section 501(c)(3) (reprinted 
elsewhere).]

SEC. 410. TERMINATION OF AGREEMENT.

  (a) In General.--If--
          (1) no agreement is entered into between the United 
        States and Canada on a substitute system of rules for 
        antidumping and countervailing duties before the date 
        that is 7 years after the date on which the Agreement 
        enters into force, and
          (2) the President decides not to exercise the rights 
        of the United States under article 1906 of the 
        Agreement to terminate the Agreement,
the President shall submit to the Congress a report on such 
decision which explains why continued adherence to the 
Agreement is in the national economic interest of the United 
States. In calculating the 7-year period referred to in 
paragraph (1), any time during which Canada is a NAFTA country 
(as defined in section 2(4) of the North American Free Trade 
Agreement Implementation Act) shall be disregarded.
  [(b) Transition Provisions.--Suspended as provided in section 
501(c)(3).]

               TITLE V--EFFECTIVE DATES AND SEVERABILITY


SEC. 501. EFFECTIVE DATES.

    (a) In General.--Except as provided in subsection (b), the 
provisions of this Act, and the amendments made by this Act, 
shall take effect on the date of enactment of this Act.
    (b) Exceptions.--Sections 1 and 2, title I, section 304 
(except subsection (f)), section 309, this section and section 
502 shall take effect on the date of enactment of this Act.
    (c) Termination or Suspension of Agreement.--
          (1) Termination of agreement.--On the date the 
        Agreement ceases to be in force, the provision of this 
        Act (other than this paragraph and section 410(b)), and 
        the amendments made by this Act, shall cease to have 
        effect.
          (2) Effect of agreement suspension.--An agreement by 
        the United States and Canada to suspend the operation 
        of the Agreement shall not be deemed to cause the 
        Agreement to cease to be in force within the meaning of 
        paragraph (1).
          (3) Suspension resulting from nafta.--On the date the 
        United States and Canada agree to suspend the operation 
        of the Agreement by reason of the entry into force 
        between them of the North American Free Trade 
        Agreement, the following provisions of this Act are 
        suspended and shall remain suspended until such time as 
        the suspension of the Agreement may be terminated:
                  (A) Sections 204(a) and (b) and 205(a).
                  (B) Sections 302 and 304(f).
                  (C) Sections 404, 409, and 410(b).

SEC. 502. SEVERABILITY.

    If any provision of this Act, any amendment made by this 
Act, or the application of such a provision or amendment to any 
person or circumstances is held to be invalid, the remainder of 
this Act, the remaining amendments made by this Act, and the 
application of such provision or amendment to persons or 
circumstances other than those to which it is held invalid, 
shall not be affected thereby.

           Automotive Products Trade Act of 1965, as amended


[19 U.S.C. 2001 et seq.; P.L. 89-283, as amended by P.L. 96-39 and P.L. 
                                100-418]

                   TITLE I--SHORT TITLE AND PURPOSES


SEC. 101. SHORT TITLE.

  This Act may be cited as the ``Automotive Products Trade Act 
of 1965.''

SEC. 102. PURPOSES.

    The purposes of this Act are--
          (1) to provide for the implementation of the 
        Agreement Concerning Automotive Products Between the 
        Government of the United States of America and the 
        Government of Canada signed on January 16, 1965 
        (hereinafter referred to as the ``Agreement''), in 
        order to strengthen the economic relations and expand 
        trade in automotive products between the United States 
        and Canada; and
          (2) to authorize the implementation of such other 
        international agreements providing for the mutual 
        reduction or elimination of duties applicable to 
        automotive products as the Government of the United 
        States may hereafter enter into.

                      TITLE II--BASIC AUTHORITIES


SEC. 201. IMPLEMENTATION OF THE AGREEMENT.

    (a) The President is authorized to proclaim the 
modifications of the Harmonized Tariff Schedule of the United 
States provided for in title IV of this Act.
    (b) At any time after the issuance of the proclamation 
authorized by subsection (a), the President is authorized to 
proclaim further modifications of the Harmonized Tariff 
Schedule of the United States to provide for the duty-free 
treatment of any Canadian article which is original motor-
vehicle equipment (as defined by such Schedules as modified 
pursuant to subsection (a)) if he determines that the 
importation of such article, is actually or potentially of 
commercial significance and that such duty-free treatment is 
required to carry out the Agreement.

SEC. 202. IMPLEMENTATION OF OTHER AGREEMENTS.

    (a) Whenever, after determining that such an agreement will 
afford mutual trade benefits, the President enters into an 
agreement with the government of a country providing for the 
mutual elimination of the duties applicable to products of 
their respective countries which are motor vehicles and 
fabricated components intended for use as original equipment in 
the manufacture of such vehicles, the President (in accordance 
with subsection (d)) is authorized to proclaim such 
modifications of the Tariff Schedules of the United States as 
he determines to be required to carry out such agreement.
    (b) Whenever, after having entered into an agreement with 
the government of a country providing for the mutual 
elimination of the duties applicable to products described in 
subsection (a), the President, after determining that such 
further agreement will afford mutual trade benefits, enters 
into a further agreement with such government providing for the 
mutual reduction or elimination of the duties applicable to 
automotive products other than motor vehicles and fabricated 
components intended for use as original equipment in the 
manufacture of such vehicles, the President (in accordance with 
subsection (d)) is authorized to proclaim such modifications of 
the Tariff Schedules of the United States as he determines to 
be required to carry out such further agreement.
    (c) Before the President enters into the negotiation of an 
agreement referred to in subsection (a) or (b), he shall--
          (1) seek the advice of the Tariff Commission as to 
        the probable economic effect of the reduction or 
        elimination of duties on industries producing articles 
        like or directly competitive with those which may be 
        covered by such agreement;
          (2) give reasonable public notice of his intention to 
        negotiate such agreement (which notice shall be 
        published in the Federal Register) in order that any 
        interested person may have an opportunity to present 
        his views to such agency as the President may 
        prescribe; and
          (3) seek information and advice with respect to such 
        agreement from the Department of Commerce, Labor, 
        State, and the Treasury, and from such other sources as 
        he may deem appropriate.
    (d)(1) The President shall transmit to each House of the 
Congress a copy of each agreement referred to in subsection (a) 
or (b). The delivery to both Houses shall be on the same day 
and shall be made to each House while it is in session.
    (2) The President is authorized to issue any proclamation 
to carry out any such agreement--
          (A) only after the expiration of the 60-day period 
        following the date of delivery,
          (B) only if, between the date of delivery and the 
        expiration of such 60-day period, the Congress has not 
        adopted a concurrent resolution stating in substance 
        that the Senate and House of Representatives disapprove 
        of the agreement, and
          (C) in the case of any agreement referred to in 
        subsection (b) with any country only if there is in 
        effect a proclamation implementing an agreement with 
        such country applicable to products described in 
        subsection (a).
    (3) For purposes of paragraph (2) in the computation of the 
60-day period there shall be excluded the days on which either 
House is not in session because of adjournment of more than 3 
days to a day certain or an adjournment of the Congress sine 
die.
    (e) This section shall cause to be in effect on the day 
after the date of the enactment of this Act.

SEC. 203. EFFECTIVE DATE OF PROCLAMATIONS.

    (a) Subject to subsection (b), the President is authorized, 
notwithstanding section 514 of the Tariff Act of 1930 (19 
U.S.C., sec. 1514) or any other provision of law, to give 
retroactive effect to any proclamation issued pursuant to 
section 201 of this Act as of the earliest date after January 
17, 1965, which he determines to be practicable.
    (b) In the case of liquidated customs entries, the 
retroactive effect pursuant to subsection (a) of any 
proclamation shall apply only upon request therefor filed with 
the customs officer concerned on or before the 90th day after 
the date of such proclamation and subject to such other 
conditions as the President may specify.

SEC. 204. TERMINATION OF PROCLAMATIONS.

    The President is authorized at any time to terminate, in 
whole or in part, any proclamation issued pursuant to section 
201 or 202 of this Act.

SEC. 205. SPECIAL REPORTS TO CONGRESS.

    (a) No later than August 31, 1968, the President shall 
submit to the Senate and the House of Representatives a special 
report on the comprehensive review called for by Article IV(c) 
of the Agreement. In such report he shall advise the Congress 
of the progress made toward the achievement of the objectives 
of Article I of the Agreement.
    (b) Whenever the President finds that any manufacturer has 
entered into any undertaking, by reason of governmental action, 
to increase the Canadian value added of automobiles, buses, 
specified commercial vehicles, or original equipment parts 
produced by such manufacturer in Canada after August 31, 1968, 
he shall report such finding to the Senate and the House of 
Representatives. The President shall also report whether such 
undertaking is additional to undertakings agreed to in letters 
of undertaking submitted by such manufacturer before the date 
of enactment of this Act.
    (c) The reports provided for in subsections (a) and (b) of 
this section shall include recommendations for such further 
steps, including legislative action, if any, as may be 
necessary for the achievement of the purposes of the Agreement 
and this Act.

      TITLE III--TARIFF ADJUSTMENT AND OTHER ADJUSTMENT ASSISTANCE


SEC. 301. GENERAL AUTHORITY.

    Subject to section 302 of this Act, a petition may be filed 
for tariff adjustment or for a determination of eligibility to 
apply for adjustment assistance under title III of the Trade 
Expansion Act of 1962 (19 U.S.C., sec. 1901-1991) as though the 
reduction or elimination of a duty proclaimed by the President 
pursuant to section 201 or 202 of this Act were a concession 
granted under a trade agreement referred to in section 301 of 
the Trade Expansion Act of 1962.

SEC. 302. SPECIAL AUTHORITY DURING TRANSITIONAL PERIOD UNDER THE 
                    AGREEMENT.

    (a) After the 90th day after the date of the enactment of 
this Act and before July 1, 1968, a petition under section 301 
of this Act for a determination of eligibility to apply for 
adjustment assistance may be filed with the President by--
          (1) a firm which produces an automotive product, or 
        its representative; or
          (2) a group of workers in a firm which produces an 
        automotive product, or their certified or recognized 
        union or other duly authorized representative.
    (b) After a petition is filed by a firm or group of workers 
under subsection (a), the President shall determine whether--
          (1) dislocation of the firm or group of workers has 
        occurred or threatens to occur;
          (2) production in the United States of the automotive 
        product concerned produced by the firm, or an 
        appropriate subdivision thereof, and of the automotive 
        product like or directly competitive therewith, has 
        decreased appreciably; and
          (3)(A) imports into the United States from Canada of 
        the Canadian automotive product like or directly 
        competitive with that produced by the firm, or an 
        appropriate subdivision thereof, have increased 
        appreciably; or
          (B) exports from the United States to Canada of the 
        United States automotive product concerned produced by 
        the firm, or an appropriate subdivision thereof, and of 
        the United States automotive product like or directly 
        competitive therewith, have decreased appreciably, and 
        the decrease in such exports is greater than the 
        decrease, if any, in production in Canada of the 
        Canadian automotive product like or directly 
        competitive with the United States automotive product 
        being exported.
    (c) If the President makes an affirmative determination 
under paragraphs (1), (2), and (3) of subsection (b), with 
respect to a firm or group of workers, he shall promptly 
certify that as a result of its dislocation the firm or group 
of workers is eligible to apply for adjustment assistance, 
unless the President determines that the operation of the 
Agreement has not been the primary factor in causing or 
threatening to cause dislocation of the firm or group of 
workers.
    (d) If the President makes an affirmative determination 
under paragraph (1) but a negative determination under 
paragraph (2) or (3) of subsection (b), with respect to a firm 
or group of workers, the President shall determine whether the 
operation of the Agreement has nevertheless been the primary 
factor in causing or threatening to cause dislocation of the 
firm or group of workers. If the President makes such an 
affirmative determination, he shall promptly certify that as a 
result of its dislocation the firm or group of workers is 
eligible to apply for adjustment assistance.
    (e)(1) In order to provide the President with a factual 
record on the basis of which he may make the determinations 
referred to in subsections (b), (c), and (d) with respect to a 
firm or a group of workers, the President shall promptly 
transmit to the Tariff Commission a copy of each petition filed 
under such subsection (a) and, not later than 5 days after the 
date on which the petition is filed, shall request the Tariff 
Commission to conduct an investigation related to questions of 
fact relevant to such determinations and to make a report of 
the facts disclosed by such investigation. In his request, the 
President may specify the particular kinds of data which he 
deems appropriate. Upon receipt of the President's request, the 
Tariff Commission shall promptly institute the investigation 
and public notice thereof in the Federal Register.
    (2) In the course of each investigation conducted under 
paragraph (1), the Tariff Commission shall, after reasonable 
notice, hold a public hearing, if such hearing is requested 
(not later than 10 days after the date of the publication of 
its notice under paragraph (1)) by the petitioner or any other 
person showing a proper interest in the subject matter of the 
investigation, and shall afford interested persons an 
opportunity to be present, to produce evidence, and to be heard 
at such hearing.
    (3) Not later than 50 days after the date on which it 
receives the request of the President under paragraph (1), the 
Tariff Commission shall transmit to the President a report of 
the facts disclosed by its investigation, together with the 
transcript of the hearing and any briefs which may have been 
submitted in connection with such investigation.
    (f)(1) The President shall make each final determination 
under subsection (b), (c), or (d) with respect to a firm or 
group of workers only after he has sought advice from the 
Departments of Commerce, Labor, and the Treasury, the Small 
Business Administration, and such other agencies as he may deem 
appropriate.
    (2) The President shall make each such final determination 
not later than 15 days after the date on which he receives the 
Tariff Commission's report, unless, within such period, the 
President requests additional factual information from the 
Tariff Commission. In this event, the Tariff Commission shall, 
not later than 25 days after the date on which it receives the 
President's request, furnish such additional factual 
information in a supplemental report, and the President shall 
make his final determination not later than 10 days after the 
date on which he receives such supplemental report.
    (3) The President shall promptly publish in the Federal 
Register a summary of each final determination under this 
section.
    (g) Any certification with respect to a group of workers 
made by the President under this section shall--
          (1) specify the date on which the dislocation began 
        or threatens to begin; and
          (2) be terminated by the President whenever he 
        determines that the operation of the Agreement is no 
        longer the primary factor in causing separations from 
        the firm or subdivision thereof, in which case such 
        termination shall apply only with respect to 
        separations occurring after the termination date 
        specified by the President.
    (h) Any certification with respect to a firm or a group of 
workers or any termination of such certification, including the 
specification of a date in such certification or termination, 
made by the President under this section shall constitute a 
certification or termination, including the specification of a 
date therein, under section 302 of the Trade Expansion Act of 
1962 (19 U.S.C., sec. 1902) for purposes of chapter 2 or of 
title III of that Act.
    (i) If a firm which has been certified under this section 
applies for tax assistance as provided by section 317 of the 
Trade Expansion Act of 1962, the reference in subsection (a)(2) 
of such section 317 to a trade or business which was seriously 
injured by increased imports which the Tariff Commission has 
determined to result from concessions granted under trade 
agreements shall be treated as referring to a trade or business 
which was seriously injured by the operation of the Agreement.
    (j) Notwithstanding any provision of chapter 3 of title III 
of the Trade Expansion Act of 1962 or of this title, 
applications based on any certification made by the President 
under this section for--
          (1) trade readjustment allowances for weeks of 
        unemployment beginning after January 17, 1965, and 
        before the 90th day after the date of the enactment of 
        this Act, and
          (2) relocation allowances for relocations occurring 
        after January 17, 1965, and before such 90th day,
shall be determined in accordance with regulations prescribed 
by the Secretary of Labor.
    (k) The President is authorized to exercise any of his 
functions under this section through such agency or other 
instrumentality of the United States Government as he may 
direct and in conformity with such rules or regulations as he 
may prescribe.
    (l) For purposes of this section--
          (1) The term ``automotive product'' means a motor 
        vehicle or a fabricated component to be used as 
        original equipment in the manufacture of motor 
        vehicles.
          (2) The term ``dislocation'' means--
                  (A) in the case of a firm, injury to the 
                firm, which may be evidenced by such conditions 
                as idling of productive facilities, inability 
                to operate at a level of reasonable profit, or 
                unemployment or underemployment and which is of 
                a serious nature; and
                  (B) in the case of a group of workers, 
                unemployment or underemployment of a 
                significant number or proportion of the workers 
                of a firm or an appropriate subdivision 
                thereof.
          (3) The term ``firm'' includes an individual 
        proprietorship, partnership, joint venture, 
        association, corporation (including a development 
        corporation), business trust, cooperative, trustees in 
        bankruptcy, and receivers under decree of any court. A 
        firm, together with any predecessor, successor, or 
        affiliated firm controlled or substantially 
        beneficially owned by substantially the same persons, 
        may be considered a single firm where necessary to 
        prevent unjustifiable benefits.
          (4) The term ``operation of the Agreement'' includes 
        governmental or private actions in the United States or 
        Canada directly related to the conclusion or 
        implementation of the Agreement.

SEC. 303. ADJUSTMENT ASSISTANCE RELATED TO OTHER AGREEMENTS.

    At the time the President transmits to the Congress a copy 
of any agreement pursuant to section 202(d)(1), he shall 
recommend to the Congress such legislative provisions 
concerning adjustment assistance to firms and workers as he 
determines to be appropriate in light of the anticipated 
economic impact of the reduction or elimination of duties 
provided for by such agreement.

SEC. 304. AUTHORIZATION OF APPROPRIATIONS.

    There are hereby authorized to be appropriated such sums as 
may be necessary from time to time to carry out the provisions 
of this title, which sums are authorized to be appropriated to 
remain available until expended.

    TITLE IV--MODIFICATIONS OF TARIFF SCHEDULES OF THE UNITED STATES


SEC. 401. ENTRY INTO FORCE AND STATUS OF MODIFICATIONS.

    (a) The modifications of the Tariff Schedules of the United 
States provided for in this title shall not enter into force 
except as proclaimed by the President pursuant to section 
201(a) of this Act.
    (b) The rates of duty in column numbered 1 of the Tariff 
Schedules of the United States which are modified pursuant to 
section 201(a) of this Act shall be treated--
          (1) as not having the status of statutory provisions 
        enacted by the Congress, but
          (2) as having been proclaimed by the President as 
        being required to carry out a foreign trade agreement 
        to which the United States is a party.

SEC. 402. REFERENCES TO TARIFF SCHEDULES.

    Whenever in this title a modification is expressed in terms 
of a modification of an item or other provision, the reference 
shall be considered to be made to an item or other provision of 
the Tariff Schedules of the United States (19 U.S.C., sec. 
1202). Each page reference ``(p.   )'' in this title refers to 
the page on which the item or provision referred to appears 
both in part II of the Federal Register for August 7, 1963, and 
in volume 77A of the United States Statutes at Large.

SEC. 403. DEFINITION OF CANADIAN ARTICLE.

    In general headnote 3 (pp. 11 and 12) redesignate 
paragraphs (d), (e), and (f) as paragraphs (e), (f), and (g), 
respectively, and insert a new paragraph (d) as follows:
    [Text of general headnote 3(c).]

SEC. 404. DEFINITION OF ORIGINAL MOTOR-VEHICLE EQUIPMENT.

    In the headnotes for subpart B, part 6, schedule 6, add 
after headnote 1 (p. 325) the following new headnote:
    [Text of headnote 2, part 6B, schedule 6.]

SEC. 405. IDENTIFICATION OF AUTOMOTIVE PRODUCTS.

    (a) Redesignate item 692.25 (p. 326) as 692.27; in headnote 
1(b) of subpart B, part 6, schedule 6 (p. 325) substitute 
``item 692.27'' in lieu of ``item 692.25''; and insert in 
proper numerical sequence new items as follows:


-``692.0If Canadian article, but not--------Free------------------------
         including any electric trolley
         bus, three-wheeled vehicle, or
         trailer accompanying an
         automobile truck tractor (see
         general headnote 3(d))
   692.1If Canadian article, but not        Free
         including any three-wheeled
         vehicle (see general headnote
         3(d))
   692.21   Chassis, if Canadian article,   Free
             except chassis for an
             electric trolley bus, or a
             three-wheeled vehicle; bodies
             (including cabs), if Canadian
             article and original motor-
             vehicle equipment (see
             headnote 2 of this subpart)
   692.23   Chassis, if Canadian article,   Free
             except chassis designed
             primarily for a vehicle
             described in item 692.15 or a
             three-wheeled vehicle; bodies
             (including cabs), if Canadian
             article and original motor-
             vehicle equipment (see
             headnote 2 of this subpart)
   692.25   If Canadian article and         Free
             original motor-vehicle
             equipment (see headnote 2 of
             this subpart)
   692.28   Automobile truck tractors, if   Free''
             Canadian article: other
             articles, if Canadian article
             and original motor-vehicle
             equipment (see headnote 2 of
             this subpart)
------------------------------------------------------------------------

    (b) Insert in proper numerical sequence new items as 
follows:



-``361.9Any article described in the--------Free------------------------
         foregoing items 360.20 to 360.70,
         inclusive, 360.80, 361.80, or
         361.85, if Canadian article and
         original motor-vehicle equipment
         (see headnote 2, part 6B,
         schedule 6)
   516.9Any article described in the        Free
         foregoing items 516.71 to 516.76,
         inclusive, or 516.94, if Canadian
         article and original motor-
         vehicle equipment (see headnote
         2, part 6B, schedule 6)
   646.7Any article described in the        Free
         foregoing items 646.20 and items
         646.78, inclusive (except 646.45
         and 646.47), if Canadian article
         and original motor-vehicle
         equipment (see headnote 2, part
         6B, schedule 6)
   652.3Any article described in the        Free
         foregoing items 652.12 to 652.38,
         inclusive, if Canadian article
         and original motor-vehicle
         equipment (see headnote 2, part
         6B, schedule 6)
   658.1Any article described in the        Free
         foregoing items 657.09 to 658.00,
         inclusive, if Canadian article
         and original motor-vehicle
         equipment (see headnote 2, part
         6B, schedule 6)
   682.6Any article described in the        Free
         foregoing items 682.10 to 682.60,
         inclusive (except 682.50), if
         Canadian article and original
         motor-vehicle equipment (see
         headnote 2, part 6B, schedule 6)
   685.5Any article described in the        Free
         foregoing items 685.20 to 685.50,
         inclusive, if Canadian article
         and original motor-vehicle
         equipment (see headnote 2, part
         6B, schedule 6)
   721.2Any article in the foregoing item   Free''
         covering clocks, clock movements,
         clock cases and dials and parts
         thereof, plates (720.67),
         assemblies and subassemblies for
         clock movements, and other parts
         for clock movements, if Canadian
         article and original motor-
         vehicle equipment (see headnote
         2, part 6B, schedule 6)
------------------------------------------------------------------------

    (c) Insert in proper numerical sequence new items 355.27, 
389.80, 728.30, 745.80, and 774.70, each having an article 
description and rate as follows:


------- ``Any article described in the------Free''----------------------
         foregoing provisions of this
         subpart, if Canadian article and
         original motor-vehicle equipment
         (see headnote 2, part 6B,
         schedule 6)
------------------------------------------------------------------------

    (d) Redesignate item 613.16 as 613.18, item 652.85 as 
652.84, item 652.87 as 652.88, item 680.34 as 680.33, item 
680.58 as 680.60, item 680.59 as 680.70, item 680.60 as 680.90, 
and item 711.91 as 711.93; and insert in proper numerical 
sequence new items as follows:

    207.01                      652.89                      683.11
    220.46                      660.43                      683.16
    357.91                      660.45                      683.61
    357.96                      660.47                      683.66
    358.03                      660.51                      684.41
    517.82                      660.53                      684.63
    535.15                      660.55                      684.71
    540.72                      660.86                      685.71
    544.18                      660.93                      685.81
    544.32                      660.95                      685.91
    544.42                      661.11                      686.11
    544.52                      661.13                      686.23
    544.55                      661.16                      686.61
    545.62                      661.21                      686.81
    545.64                      661.36                      687.51
    547.16                      661.93                      687.61
    610.81                      661.96                      688.13
    613.16                      662.36                      688.41
    613.19                      662.51                      711.85
    618.48                      664.51                      711.91
    620.47                      678.51                      711.99
    642.21                      680.21                      712.51
    642.86                      680.23                      727.07
    642.88                      680.28                      772.66
    646.93                      680.31                      772.81
    647.02                      680.34                      772.86
    647.06                      680.36                      773.26
    652.10                      680.58                      773.31
    652.76                      680.91                      791.81
    652.85                      682.71                      791.91
    652.87                      682.91
    
each such item having the article description ``If Canadian 
article and original motor-vehicle equipment (see headnote 2, 
part 6B, schedule 6) * * *'' subordinate to the immediately 
preceding article description, and having ``Free'' in rate of 
duty column numbered 1.

                      TITLE V--GENERAL PROVISIONS


SEC. 501. AUTHORITIES.

    The head of any agency performing functions authorized by 
this Act may--
          (1) authorize the head of any agency to perform any 
        of such functions; and
          (2) prescribe such rules and regulations as may be 
        necessary to perform such functions.

SEC. 502. ANNUAL REPORT.

    The President shall submit to the Congress an annual report 
on the implementation of this Act. Such report shall include 
information regarding new negotiations, reductions or 
eliminations of duties, reciprocal concessions obtained, and 
other information relating to activities under this Act. Such 
report shall also include information providing an evaluation 
of the Agreement and this Act in relation to the total national 
interest, and specifically shall include, to the extent 
practicable, information with respect to--
          (1) the production of motor vehicles and motor 
        vehicle parts in the United States and Canada,
          (2) the retail prices of motor vehicles and motor 
        vehicles parts in the United States and Canada,
          (3) employment in the United States and Canada, and
          (4) United States and Canadian trade in motor 
        vehicles and motor vehicle parts, particularly trade 
        between the United States and Canada.

SEC. 503. APPLICABILITY OF ANTIDUMPING AND ANTITRUST LAWS.

    Nothing contained in this Act shall be construed to affect 
or modify the provisions of subtitle B of title VII of the 
Tariff Act of 1930, or of any of the antitrust laws as 
designated in section 1 of the Act entitled ``An Act to 
supplement existing laws against unlawful restraints and 
monopolies, and for other purposes'', approved October 15, 1914 
(15 U.S.C. 12).

                   TITLE VI--MISCELLANEOUS PROVISIONS


SEC. 601. JOINT COMMITTEE ON REDUCTION OF NONESSENTIAL FEDERAL 
                    EXPENDITURES.

    Section 601(e) of the Revenue Act of 1941 (55 Stat. 726) 
(relating to the Joint Committee on Reduction of Nonessential 
Federal Expenditures) is amended to read as follows:
    ``(e) There are hereby authorized to be appropriated such 
sums as may be necessary to carry out the provisions of this 
section.''

            General Note 5 of the Harmonized Tariff Schedule

    Automotive Products and Motor Vehicles Eligible for Special 
Tariff Treatment.--Articles entered under the Automotive 
Products Trade Act are subject to the following provisions:
          (a) Motor vehicles and original motor-vehicle 
        equipment which are Canadian articles and which fall in 
        provisions for which the rate of duty ``Free (B)'' 
        appears in the ``Special'' subcolumn may be entered 
        free of duty. As used in this note--
                  (1) The term ``Canadian article'' means an 
                article which originates in Canada, as defined 
                in general note 12.
                  (2) The term ``original motor-vehicle 
                equipment'', as used with reference to a 
                Canadian article (as defined above), means such 
                a Canadian article which has been obtained from 
                a supplier in Canada under or pursuant to a 
                written order, contract or letter of intent of 
                a bona fide motor vehicle manufacturer in the 
                United States, and which is a fabricated 
                component originating in Canada, as defined in 
                general note 12, and intended for use as 
                original equipment in the manufacture in the 
                United States of a motor vehicle, but the term 
                does not include trailers or articles to be 
                used in their manufacture.
                  (3) The term ``motor vehicle'', as used in 
                this note, means a motor vehicle of a kind 
                described in headings 8702, 8703 and 8704 of 
                chapter 87 (excluding an electric trolley bus 
                and a three-wheeled vehicle) or an automobile 
                truck tractor principally designed for the 
                transport of persons or goods.
                  (4) The term ``bona fide motor-vehicle 
                manufacturer'' means a person who, upon 
                application to the Secretary of Commerce, is 
                determined by the Secretary to have produced no 
                fewer than 15 complete motor vehicles in the 
                United States during the previous 12 months, 
                and to have installed capacity in the United 
                States to produce 10 or more complete motor 
                vehicles per 40-hour week. The Secretary of 
                Commerce shall maintain, and publish from time 
                to time in the Federal Register, a list of the 
                names and addresses of bona fide motor-vehicle 
                manufacturers.
          (b) If any Canadian article accorded the status of 
        original motor-vehicle equipment is not so used in the 
        manufacture in the United States of motor vehicles, 
        such Canadian article or its value (to be recovered 
        from the importer or other person who diverted the 
        article from its intended use as original motor-vehicle 
        equipment) shall be subject to forfeiture, unless at 
        the time of the diversion of the Canadian article the 
        United States Customs Service is notified in writing, 
        and, pursuant to arrangements made with the Service--
                  (1) the Canadian article is, under customs 
                supervision, destroyed or exported, or
                  (2) duty is paid to the United States 
                Government in an amount equal to the duty which 
                would have been payable at the time of entry if 
                the Canadian article had not been entered as 
                original motor-vehicle equipment.
           Chapter 14: ORGANIZATION OF TRADE POLICY FUNCTIONS

                              A. CONGRESS

                       1. Congressional Advisers

            Section 161 of the Trade Act of 1974, as amended

  [19 U.S.C. 2211; P.L. 93-618, as amended by P.L. 96-39 and P.L. 100-
                                  418]

SEC. 161. CONGRESSIONAL ADVISERS FOR TRADE POLICY AND NEGOTIATIONS.

    (a) Selection.--
          (1) At the beginning of each regular session of 
        Congress, the Speaker of the House of Representatives, 
        upon the recommendation of the chairman of the 
        Committee on Ways and Means, shall select 5 members 
        (not more than 3 of whom are members of the same 
        political party) of such committee, and the President 
        pro tempore of the Senate, upon the recommendation of 
        the chairman of the Committee on Finance, shall select 
        5 members (not more than 3 of whom are members of the 
        same political party) of such committee, who shall be 
        designated congressional advisers on trade policy and 
        negotiations. They shall provide advice on the 
        development of trade policy and priorities for the 
        implementation thereof. They shall also be accredited 
        by the United States Trade Representative on behalf of 
        the President as official advisers to the United States 
        delegations to international conferences, meetings, and 
        negotiating sessions relating to trade agreements.
          (2)(A) In addition to the advisers designated under 
        paragraph (1) from the Committee on Ways and Means and 
        the Committee on Finance--
                  (i) the Speaker of the House may select 
                additional members of the House, for 
                designation as congressional advisers regarding 
                specific trade policy matters or negotiations, 
                from any other committee of the House or joint 
                committee of Congress that has jurisdiction 
                over legislation likely to be affected by such 
                matters or negotiations; and
                  (ii) the President pro tempore of the Senate 
                may select additional members of the Senate, 
                for designation as congressional advisers 
                regarding specific trade policy matters or 
                negotiations, from any other committee of the 
                Senate or joint committee of Congress that has 
                jurisdiction over legislation likely to be 
                affected by such matters or negotiations.
        Members of the House and Senate selected as 
        congressional advisers under this subparagraph shall be 
        accredited by the United States Trade Representative.
          (B) Before designating any member under subparagraph 
        (A), the Speaker or the President pro tempore shall 
        consult with--
                  (i) the chairman and ranking member of the 
                Committee on Ways and Means or the Committee on 
                Finance, as appropriate; and
                  (ii) the chairman and ranking minority member 
                of the committee from which the member will be 
                selected.
          (C) Not more than 3 members (not more than 2 of whom 
        are members of the same political party) may be 
        selected under this paragraph as advisers from any 
        committee of Congress.
    (b) Briefing.--
          (1) The United States Trade Representative shall keep 
        each official adviser designated under subsection 
        (a)(1) currently informed on matters affecting the 
        trade policy of the United States and, with respect to 
        possible agreements, negotiating objectives, the status 
        of negotiations in progress, and the nature of any 
        changes in domestic law or the administration thereof 
        which may be recommended to Congress to carry out any 
        trade agreement or any requirement of, amendment to, or 
        recommendation under, such agreement.
          (2) The United States Trade Representative shall keep 
        each official adviser designated under subsection 
        (a)(2) currently informed regarding the trade policy 
        matters and negotiations with respect to which the 
        adviser is designated.
          (3)(A) The chairmen of the Committee on Ways and 
        Means and the Committee on Finance may designate 
        members (in addition to the official advisers under 
        subsection (a)(1)) and staff members of their 
        respective committees who shall have access to the 
        information provided to official advisers under 
        paragraph (1).
          (B) The Chairman of any committee of the House or 
        Senate or any joint committee of Congress from which 
        official advisers are selected under subsection (a)(2) 
        may designate other members of such committee, and 
        staff members of such committee, who shall have access 
        to the information provided to official advisers under 
        paragraph (2).
    (c) Committee Consultation.--The United States Trade 
Representative shall consult on a continuing basis with the 
Committee on Ways and Means of the House of Representatives, 
the Committee on Finance of the Senate, and the other 
appropriate committees of the House and Senate on the 
development, implementation, and administration of overall 
trade policy of the United States. Such consultations shall 
include, but are not limited to, the following elements of such 
policy:
          (1) The principal multilateral and bilateral 
        negotiating objectives and the progress being made 
        toward their achievement.
          (2) The implementation, administration, and 
        effectiveness of recently concluded multilateral and 
        bilateral trade agreements and resolution of trade 
        disputes.
          (3) The actions taken, and proposed to be taken, 
        under the trade laws of the United States and the 
        effectiveness, or anticipated effectiveness, of such 
        actions in achieving trade policy objectives.
          (4) The important developments and issues in other 
        areas of trade for which there must be developed proper 
        policy response.
When necessary, meetings shall be held with each Committee in 
executive session to review matters under negotiation.

                         2. Reports to Congress


       Sections 162 and 163 of the Trade Act of 1974, as amended


 [19 U.S.C. 2212 and 2213; P.L. 93-618, as amended by P.L. 100-418 and 
                             P.L. 100-647]

SEC. 162. TRANSMISSION OF AGREEMENTS TO CONGRESS.

    (a) As soon as practicable, after a trade agreement entered 
into under section 123 or 124 or under section 1102 of the 
Omnibus Trade and Competitiveness Act of 1988 has entered into 
force with respect to the United States, the President shall, 
if he has not previously done so, transmit a copy of such trade 
agreement to each House of the Congress together with a 
statement, in the light of the advice of the International 
Trade Commission under section 131(b), if any, and of other 
relevent considerations, of his reasons for entering into the 
agreement.
    (b) The President shall transmit to each Member of the 
Congress a summary of the information required to be 
transmitted to each House under subsection (a). For purposes of 
this subsection, the term ``Member'' includes any Delegate or 
Resident Commissioner.

SEC. 163. REPORTS.

    (a) Annual Report on Trade Agreements Program and National 
Trade Policy Agenda.--
          (1) The President shall submit to the Congress during 
        each calendar year (but not later than March 1 of that 
        year) a report on--
                  (A) the operation of the trade agreements 
                program, and the provision of import relief and 
                adjustment assistance to workers and firms, 
                under this Act during the preceding calendar 
                year; and
                  (B) the national trade policy agenda for the 
                year in which the report is submitted.
          (2) The report shall include, with respect to the 
        matters referred to in paragraph (1)(A), information 
        regarding--
                  (A) new trade negotiations;
                  (B) changes made in duties and nontariff 
                barriers and other distortions of trade of the 
                United States;
                  (C) reciprocal concessions obtained;
                  (D) changes in trade agreements (including 
                the incorporation therein of actions taken for 
                import relief and compensation provided 
                therefor);
                  (E) the extension or withdrawal of 
                nondiscriminatory treatment by the United 
                States with respect to the products of foreign 
                countries;
                  (F) the extension, modification, withdrawal, 
                suspension, or limitation of preferential 
                treatment to exports of developing countries;
                  (G) the results of actions to obtain the 
                removal of foreign trade restrictions 
                (including discriminatory restrictions) against 
                United States exports and the removal of 
                foreign practices which discriminate against 
                United States service industries (including 
                transportation and tourism) and investment;
                  (H) the measures being taken to seek the 
                removal of other significant foreign import 
                restrictions;
                  (I) each of the referrals made under section 
                141(d)(1)(B) and any action taken with respect 
                to such referral;
                  (J) other information relating to the trade 
                agreements program and to the agreements 
                entered into thereunder; and
                  (K) the number of applications filed for 
                adjustment assistance for workers and firms, 
                the number of such applications which were 
                approved, and the extent to which adjustment 
                assistance has been provided under such 
                approved applications.
          (3)(A) The national trade policy agenda required 
        under paragraph (1)(B) for the year in which a report 
        is submitted shall be in the form of a statement of--
                  (i) the trade policy objectives and 
                priorities of the United States for the year, 
                and the reasons therefor;
                  (ii) the actions proposed, or anticipated, to 
                be undertaken during the year to achieve such 
                objectives and priorities, including, but not 
                limited to, actions authorized under the trade 
                laws and negotiations with foreign countries;
                  (iii) any proposed legislation necessary or 
                appropriate to achieve any of such objectives 
                or priorities; and
                  (iv) the progress that was made during the 
                preceding year in achieving the trade policy 
                objectives and priorities included in the 
                statement provided for that year under this 
                paragraph.
          (B) The President may separately submit any 
        information referred to in subparagraph (A) to the 
        Congress in confidence if the President considers 
        confidentiality appropriate.
          (C) Before submitting the national trade policy 
        agenda for any year, the President shall seek advice 
        from the appropriate advisory committees established 
        under section 135 and shall consult with the 
        appropriate committees of the Congress.
          (D) The United States Trade Representative (hereafter 
        referred to in this section as the ``Trade 
        Representative'') and other appropriate officials of 
        the United States Government shall consult periodically 
        with the appropriate committees of the Congress 
        regarding the annual objectives and priorities set 
        forth in each national trade policy agenda with respect 
        to--
                  (i) the status and results of the actions 
                that have been undertaken to achieve the 
                objectives and priorities; and
                  (ii) any development which may require, or 
                result in, changes to any of such objectives or 
                priorities.
    (b) Annual Trade Projection Report.--
          (1) In order for the Congress to be informed of the 
        impact of foreign trade barriers and macroeconomic 
        factors on the balance of trade of the United States, 
        the Trade Representative and the Secretary of the 
        Treasury shall jointly prepare and submit to the 
        Committee on Finance of the Senate and the Committee on 
        Ways and Means of the House of Representatives 
        (hereafter referred to in this subsection as the 
        ``Committees'') on or before March 1 of each year a 
        report which consists of--
                  (A) a review and analysis of--
                          (i) the merchandise balance of trade,
                          (ii) the goods and services balance 
                        of trade,
                          (iii) the balance on the current 
                        account,
                          (iv) the external debt position,
                          (v) the exchange rates,
                          (vi) the economic growth rates,
                          (vii) the deficit or surplus in the 
                        fiscal budget, and
                          (viii) the impact on United States 
                        trade of market barriers and other 
                        unfair practices,
                of countries that are major trading partners of 
                the United States, including, as appropriate, 
                groupings of such countries;
                  (B) projections for each of the economic 
                factors described in subparagraph (A) (except 
                those described in clauses (v) and (viii)) for 
                each of the countries and groups of countries 
                referred to in subparagraph (A) for the year in 
                which the report is submitted and for the 
                succeeding year; and
                  (C) conclusions and recommendations, based 
                upon the projections referred to in 
                subparagraph (B), for policy changes, including 
                trade policy, exchange rate policy, fiscal 
                policy, and other policies that should be 
                implemented to improve the outlook.
          (2) To the extent that subjects referred to in 
        paragraph (1) (A), (B), or (C) are covered in the 
        national trade policy agenda required under subsection 
        (a)(1)(B) or in other reports required by this Act or 
        other law, the Trade Representative and the Secretary 
        of the Treasury may, as appropriate, draw on the 
        information, analysis, and conclusions, if any, in 
        those reports for the purposes of preparing the report 
        required by this subsection.
          (3) The Trade Representative and the Secretary of the 
        Treasury shall consult with the Chairman of the Board 
        of Governors of the Federal Reserve System in the 
        preparation of each report required under this 
        subsection.
          (4) The Trade Representative and the Secretary of the 
        Treasury may separately submit any information, 
        analysis, or conclusion referred to in paragraph (1) to 
        the Committees in confidence if the Trade 
        Representative and the Secretary consider 
        confidentiality appropriate.
          (5) After submission of each report required under 
        paragraph (1), the Trade Representative and the 
        Secretary of the Treasury shall consult with each of 
        the Committees with respect to the report.
    (c) ITC Reports.--The United States International Trade 
Commission shall submit to the Congress, at least once a year, 
a factual report on the operation of the trade agreements 
program.

   Section 2202 of the Omnibus Trade and Competitiveness Act of 1988


                     [15 U.S.C. 4711; P.L. 100-418]

SEC. 2202. COUNTRY REPORTS ON ECONOMIC POLICY AND TRADE PRACTICES.

    The Secretary of State shall, not later than January 31 of 
each year, prepare and transmit to the Committee on Foreign 
Affairs and the Committee on Ways and Means of the House of 
Representatives, to the Committee on Foreign Relations and the 
Committee on Finance of the Senate, and to other appropriate 
committees of the Congress, a detailed report regarding the 
economic policy and trade practices of each country with which 
the United States has an economic or trade relationship. The 
Secretary may direct the appropriate officers of the Department 
of State who are serving overseas, in consultation with 
appropriate officers or employees of other departments and 
agencies of the United States, including the Department of 
Agriculture and the Department of Commerce, to coordinate the 
preparation of such information in a country as is necessary to 
prepare the report under this section. The report shall 
identify and describe, with respect to each country--
          (1) the macroeconomic policies of the country and 
        their impact on the overall growth in demand for United 
        States exports;
          (2) the impact of macroeconomic and other policies on 
        the exchange rate of the country and the resulting 
        impact on price competitiveness of United States 
        exports;
          (3) any change in structural policies (including tax 
        incentives, regulations governing financial 
        institutions, production standards, and patterns of 
        industrial ownership) that may affect the country's 
        growth rate and its demand for United States exports;
          (4) the management of the country's external debt and 
        its implications for trade with the United States;
          (5) acts, policies, and practices that constitute 
        significant barriers to United States exports or 
        foreign direct investment in that country by United 
        States persons, as identified under section 181(a)(1) 
        of the Trade Act of 1974 (19 U.S.C. 2241(a)(1));
          (6) acts, policies, and practices that provide direct 
        or indirect government support for exports from that 
        country, including exports by small businesses;
          (7) the extent to which the country's laws and 
        enforcement of those laws afford adequate protection to 
        United States intellectual property, including patents, 
        trademarks, copyrights, and mask works; and
          (8) the country's laws, enforcement of those laws, 
        and practices with respect to internationally 
        recognized worker rights (as defined in section 
        502(a)(4) of the Trade Act of 1974), the conditions of 
        worker rights in any sector which produces goods in 
        which United States capital is invested, and the extent 
        of such investment.

  3. Congressional Fast Track Procedures With Respect to Presidential 
                                Actions


         Sections 151-154 of the Trade Act of 1974, as amended


 [19 U.S.C. 2191-2194; P.L. 93-618, as amended by P.L. 96-39, P.L. 98-
    573, P.L. 100-418, P.L. 101-382, P.L. 103-465, and P.L. 104-295]

SEC. 151. BILLS IMPLEMENTING TRADE AGREEMENTS ON NONTARIFF BARRIERS AND 
                    RESOLUTIONS APPROVING COMMERCIAL AGREEMENTS WITH 
                    COMMUNIST COUNTRIES.

    (a) Rules of House of Representatives and Senate.--This 
section and sections 152 and 153 are enacted by the Congress--
          (1) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such they are deemed a part of the rules of each 
        House, respectively, but applicable only with respect 
        to the procedure to be followed in that House in the 
        case of implementing bills described in subsection 
        (b)(1), implementing revenues bills described in 
        subsection (b)(2), approval resolutions described in 
        subsection (b)(3), and resolutions described in 
        subsections 152(a) and 153(a); and they supersede other 
        rules only to the extent that they are inconsistent 
        therewith; and
          (2) with full recognition of the constitutional right 
        of either House to change the rules (so far as relating 
        to the procedure of that House) at any time, in the 
        same manner and to the same extent as in the case of 
        any other rule of that House.
    (b) Definitions.--For purposes of this section--
          (1) The term ``implementing bill'' means only a bill 
        of either House of Congress which is introduced as 
        provided in subsection (c) with respect to one or more 
        trade agreements, or with respect to an extension 
        described in section 282(c)(3) of the Uruguay Round 
        Agreements Act, submitted to the House of 
        Representatives and the Senate under section 102 of 
        this Act, section 1103(a)(1) of the Omnibus Trade and 
        Competitiveness Act of 1988, or section 282 of the 
        Uruguay Round Agreements Act and which contains--
                  (A) a provision approving such trade 
                agreement or agreements or such extension,
                  (B) a provision approving the statement of 
                administrative action (if any) proposed to 
                implement such trade agreement or agreements, 
                and
                  (C) if changes in existing laws or new 
                statutory authority is required to implement 
                such trade agreement or agreements or such 
                extension, provisions, necessary or appropriate 
                to implement such trade agreement or agreements 
                or such extension, either repealing or amending 
                existing laws or providing new statutory 
                authority.
          (2) The term ``implementing revenue bill'' or 
        resolution means an implementing bill or approval 
        resolution which contains one or more revenue measures 
        by reason of which it must originate in the House of 
        Representatives.
          (3) The term ``approval resolution'' means only a 
        joint resolution of the two Houses of the Congress, the 
        matter after the resolving clause of which is as 
        follows: ``That the Congress approves the extension of 
        nondiscriminatory treatment with respect to the 
        products of ---------- transmitted by the President to 
        the Congress on --------.'', the first blank space 
        being filled with the name of the country involved and 
        the second blank space being filled with the 
        appropriate date.
    (c) Introduction and Referral.--
          (1) On the day on which a trade agreement or 
        extension is submitted to the House of Representatives 
        and the Senate under section 102 or section 282 of the 
        Uruguay Round Agreements Act, the implementing bill 
        submitted by the President with respect to such trade 
        agreement or extension shall be introduced (by request) 
        in the House by the majority leader of the House, for 
        himself and the minority leader of the House, or by 
        Members of the House designated by the majority leader 
        and minority leader of the House; and shall be 
        introduced (by request) in the Senate by the majority 
        leader of the Senate, for himself the minority leader 
        of the Senate, or by Members of the Senate designated 
        by the majority leader and minority leader of the 
        Senate. If either House is not in session on the day on 
        which such a trade agreement or extension is submitted, 
        the implementing bill shall be introduced in that House 
        as provided in the preceding sentence, on the first day 
        thereafter on which the House is in session. Such bills 
        shall be referred by the Presiding Officers of the 
        respective Houses to the appropriate committee, or, in 
        the case of a bill containing provisions within the 
        jurisdiction of two or more committees, jointly to such 
        committees for consideration of those provisions within 
        their respective jurisdictions.
          (2) On the day on which a bilateral commerical 
        agreement, entered into under title IV of this Act 
        after the date of the enactment of this Act, is 
        transmitted to the House of Representatives and the 
        Senate, an approval resolution with respect to such 
        agreement shall be introduced (by request) in the House 
        by the majority leader of the House, for himself and 
        the minority leader of the House, or by Members of the 
        House designated by the majority leader and minority 
        leader of the House; and shall be introduced (by 
        request) in the Senate by the majority leader of the 
        Senate, for himself and the minority leader of the 
        Senate, or by Members of the Senate designated by the 
        majority leader and minority leader of the Senate. If 
        either House is not in session on the day on which such 
        an agreement is transmitted, the approval resolution 
        with respect to such agreement shall be introduced in 
        that House, as provided in the preceding sentence, on 
        the first day thereafter on which that House is in 
        session. The approval resolution introduced in the 
        House shall be referred to the Committee on Ways and 
        Means and the approval resolution introduced in the 
        Senate shall be referred to the Committee on Finance.
    (d) Amendments Prohibited.--No amendment to an implementing 
bill or approval resolution shall be in order in either the 
House of Representatives or the Senate; and no motion to 
suspend the application of this subsection shall be in order in 
either House, nor shall it be in order in either House for the 
Presiding Officer to entertain a request to suspend the 
application of this subsection by unanimous consent.
    (e) Period for Committee and Floor Consideration.--
          (1) Except as provided in paragraph (2), if the 
        committee or committees of either House to which an 
        implementing bill or approval resolution has been 
        referred have not reported it at the close of the 45th 
        day after its introduction, such committee or 
        committees shall be automatically discharged from 
        further consideration of the bill or resolution and it 
        shall be placed on the appropriate calendar. A vote on 
        final passage of the bill or resolution shall be taken 
        in each House on or before the close of the 15th day 
        after the bill or resolution is reported by the 
        committee or committees of that House to which it was 
        referred, or after such committee or committees have 
        been discharged from further consideration of the bill 
        or resolution. If prior to the passage by one House of 
        an implementing bill or approval resolution of that 
        House, that House receives the same implementing bill 
        or approval resolution from the other House, then--
                  (A) the procedure in that House shall be the 
                same as if no implementing bill or approval 
                resolution had been received from the other 
                House; but
                  (B) the vote on final passage shall be on the 
                implementing bill or approval resolution of the 
                other House.
          (2) The provisions of paragraph (1) shall not apply 
        in the Senate to an implementing revenue bill or 
        resolution. An implementing revenue bill or resolution 
        received from the House shall be referred to the 
        appropriate committee or committees of the Senate. If 
        such committee or committees have not reported such 
        bill at the close of the 15th day after its receipt by 
        the Senate (or, if later, before the close of the 45th 
        day after the corresponding implementing revenue bill 
        or resolution was introduced in the Senate), such 
        committee or committees shall be automatically 
        discharged from further consideration of such bill or 
        resolution and it shall be placed on the calendar. A 
        vote on final passage of such bill or resolution shall 
        be taken in the Senate on or before the close of the 
        15th day after such bill or resolution is reported by 
        the committee or committees of the Senate to which it 
        was referred, or after such committee or committees 
        have been discharged from further consideration of such 
        bill or resolution.
          (3) For purposes of paragraphs (1) and (2), in 
        computing a number of days in either House, there shall 
        be excluded any day on which that House was not in 
        session.
    (f) Floor Consideration in the House.--
          (1) A motion in the House of Representatives to 
        proceed to the consideration of an implementing bill or 
        approval resolution shall be highly privileged and not 
        debatable. An amendment to the motion shall not be in 
        order, nor shall it be in order to move to reconsider 
        the vote by which the motion is agreed to or disagreed 
        to.
          (2) Debate in the House of Representatives on an 
        implementing bill or approval resolution shall be 
        limited to not more than 20 hours, which shall be 
        divided equally between those favoring and those 
        opposing the bill or resolution. A motion further to 
        limit debate shall not be debatable. It shall not be in 
        order to move to recommit an implementing bill or 
        approval resolution or to move to reconsider the vote 
        by which an implementing bill or approval resolution is 
        agreed to or disagreed to.
          (3) Motions to postpone, made in the House of 
        Representatives with respect to the consideration of an 
        implementing bill or approval resolution, and motions 
        to proceed to the consideration of other business, 
        shall be decided without debate.
          (4) All appeals from the decisions of the Chair 
        relating to the application of the Rules of the House 
        of Representatives to the procedure relating to an 
        implementing bill or approval resolution shall be 
        decided without debate.
          (5) Except to the extent specifically provided in the 
        preceding provisions of this subsection, consideration 
        of an implementing bill or approval resolution shall be 
        governed by the Rules of the House of Representatives 
        applicable to other bills and resolutions in similar 
        circumstances.
    (g) Floor Consideration in the Senate.--
          (1) A motion in the Senate to proceed to the 
        consideration of an implementing bill or approval 
        resolution shall be privileged and not debatable. An 
        amendment to the motion shall not be in order, nor 
        shall it be in order to move to reconsider the vote by 
        which the motion is agreed to or disagreed to.
          (2) Debate in the Senate on an implementing, and all 
        debatable motions and appeals in connection therewith, 
        shall be limited to not more than 20 hours. The time 
        shall be equally divided between, and controlled by, 
        the majority leader and the minority leader or their 
        designees.
          (3) Debate in the Senate on any debatable motion or 
        appeal in connection with an implementing bill or 
        approval resolution shall be limited to not more than 1 
        hour, to be equally divided between, and controlled by, 
        the mover and the manager of the bill or resolution, 
        except that in the event the manager of the bill or 
        resolution is in favor of any such motion or appeal, 
        the time in opposition thereto, shall be controlled by 
        the minority leader or his designee. Such leaders, or 
        either of them, may, from time under their control on 
        the passage of an implementing bill or approval 
        resolution, allot additional time to any Senator during 
        the consideration of any debatable motion or appeal.
          (4) A motion in the Senate to further limit debate is 
        not debatable. A motion to recommit an implementing 
        bill or approval resolution is not in order.

SEC. 152. RESOLUTIONS DISAPPROVING CERTAIN ACTIONS.

    (a) Contents of Resolution.--
          (1) For purposes of this section, the term 
        ``resolution'' means only--
                  (A) a joint resolution of the two Houses of 
                the Congress, the matter after the resolving 
                clause of which is as follows: ``That the 
                Congress does not approve the action taken by, 
                or the determination of the President under 
                section 203 of the Trade Act of 1974 
                transmitted to the Congress on --------.'', the 
                blank space being filled with the appropriate 
                date; and
                  (B) a joint resolution of the two Houses of 
                Congress, the matter after the resolving clause 
                of which is as follows: ``That the Congress 
                does not approve -------- transmitted to the 
                Congress on ----------.'', with the first blank 
                space being filled in accordance with paragraph 
                (2), and the second blank space being filled 
                with the appropriate date.
          (2) The first blank space referred to in paragraph 
        (1)(B) shall be filled, in the case of a resolution 
        referred to in section 407(c)(2), with the phrase ``the 
        report of the President submitted under section ------ 
        of the Trade Act of 1974 with respect to ------'' (with 
        the first blank space being filled with ``402(b)'' or 
        ``409(b)'', as appropriate, and the second blank space 
        being filled with the name of the country involved).
    (b) Reference to Committees.--All resolutions introduced in 
the House of Representatives shall be referred to the Committee 
on Ways and Means and all resolutions introduced in the Senate 
shall be referred to the Committee on Finance.
    (c) Discharge of Committees.--
          (1) If the committee of either House to which a 
        resolution has been referred has not reported it at the 
        end of 30 days after its introduction, not counting any 
        day which is excluded under section 154(b), it is in 
        order to move either to discharge the committee from 
        further consideration of the resolution or to discharge 
        the committee from further consideration of any other 
        resolution introduced with respect to the same matter, 
        except that a motion to discharge--
                  (A) may only be made on the second 
                legislative day after the calendar day on which 
                the Member making the motion announces to the 
                House his intention to do so; and
                  (B) is not in order after the Committee has 
                reported a resolution with respect to the same 
                matter.
          (2) A motion to discharge under paragraph (1) may be 
        made only by an individual favoring the resolution, and 
        is highly privileged in the House and privileged in the 
        Senate; and debate thereon shall be limited to not more 
        than 1 hour, the time to be divided in the House 
        equally between those favoring and those opposing the 
        resolution, and to be divided in the Senate equally 
        between, and controlled by, the majority leader and the 
        minority leader or their designees. An amendment to the 
        motion is not in order, and it is not in order to move 
        to reconsider the vote by which the motion is agreed to 
        or disagreed to.
    (d) Floor Consideration in the House.--
          (1) A motion in the House of Representatives to 
        proceed to the consideration of a resolution shall be 
        highly privileged and not debatable. An amendment to 
        the motion shall not be in order, nor shall it be in 
        order to move to reconsider the vote by which the 
        motion is agreed to or disagreed to.
          (2) Debate in the House of Representatives on a 
        resolution shall be limited to not more than 20 hours, 
        which shall be divided equally between those favoring 
        and those opposing the resolution. A motion further to 
        limit debate shall not be debatable. No amendment to, 
        or motion to recommit, the resolution shall be in 
        order. It shall not be in order to move to reconsider 
        the vote by which a resolution is agreed to or 
        disagreed to.
          (3) Motions to postpone, made in the House of 
        Representatives with respect to the consideration of a 
        resolution, and motions to proceed to the consideration 
        of other business, shall be decided without debate.
          (4) All appeals from the decisions of the Chair 
        relating to the application of the Rules of the House 
        of Representatives to the procedure relating to a 
        resolution shall be decided without debate.
          (5) Except to the extent specifically provided in the 
        preceding provisions of this subsection, consideration 
        of a resolution in the House of Representatives shall 
        be governed by the Rules of the House of 
        Representatives applicable to other resolutions in 
        similar circumstances.
    (e) Floor Consideration in the Senate.--
          (1) A motion in the Senate to proceed to the 
        consideration of a resolution shall be privileged. An 
        amendment to the motion shall not be in order, nor 
        shall it be in order to move to reconsider the vote by 
        which the motion is agreed to or disagreed to.
          (2) Debate in the Senate on a resolution, and all 
        debatable motions and appeals in connection therewith, 
        shall be limited to not more than 20 hours, to be 
        equally divided between, and controlled by, the 
        majority leader and the minority leader or their 
        designees.
          (3) Debate in the Senate on any debatable motion or 
        appeal in connection with a resolution shall be limited 
        to not more than 1 hour, to be equally divided between, 
        and controlled by, the mover and the manager of the 
        resolution, except that in the event the manager of the 
        resolution is in favor of any such motion or appeal, 
        the time in opposition thereto, shall be controlled by 
        the minority leader or his designee. Such leaders, or 
        either of them, may, from time under their control on 
        the passage of a resolution, allot additional time to 
        any Senator during the consideration of any debatable 
        motion or appeal.
          (4) A motion in the Senate to further limit debate on 
        a resolution, debatable motion, or appeal is not 
        debatable. No amendment to, or motion to recommit, a 
        resolution is in order in the Senate.
    (f) Procedures in the Senate.--
          (1) Except as otherwise provided in this section, the 
        following procedures shall apply in the Senate to a 
        resolution to which this section applies:
                  (A)(i) Except as provided in clause (ii), a 
                resolution that has passed the House of 
                Representatives shall, when received in the 
                Senate, be referred to the Committee on Finance 
                for consideration in accordance with this 
                section.
                  (ii) If a resolution to which this section 
                applies was introduced in the Senate before 
                receipt of a resolution that has passed the 
                House of Representatives, the resolution from 
                the House of Representatives shall, when 
                received in the Senate, be placed on the 
                calendar. If this clause applies, the 
                procedures in the Senate with respect to a 
                resolution introduced in the Senate that 
                contains the identical matter as the resolution 
                that passed the House of Representatives shall 
                be the same as if no resolution had been 
                received from the House of Representatives, 
                except that the vote on passage in the Senate 
                shall be on the resolution that passed the 
                House of Representatives.
                  (B) If the Senate passes a resolution before 
                receiving from the House of Representatives a 
                joint resolution that contains the identical 
                matter, the joint resolution shall be held at 
                the desk pending receipt of the joint 
                resolution from the House of Representatives. 
                Upon receipt of the joint resolution from the 
                House of Representatives, such joint resolution 
                shall be deemed to be read twice, considered, 
                read the third time, and passed.
          (2) If the texts of joint resolutions described in 
        section 152 or 153(a), whichever is applicable 
        concerning any matter are not identical--
                  (A) the Senate shall vote passage on the 
                resolution introduced in the Senate, and
                  (B) the text of the joint resolution passed 
                by the Senate shall, immediately upon its 
                passage (or, if later, upon receipt of the 
                joint resolution passed by the House), be 
                substituted for the text of the joint 
                resolution passed by the House of 
                Representatives, and such resolution, as 
                amended, shall be returned with a request for a 
                conference between the two Houses.
          (3) Consideration in the Senate of any veto message 
        with respect to a joint resolution described in 
        subsection (a)(2)(B) or section 153(a), including 
        consideration of all debatable motions and appeals in 
        connection therewith, shall be limited to 10 hours, to 
        be equally divided between, and controlled by, the 
        majority leader and the minority leader or their 
        designees.

SEC. 153. RESOLUTIONS RELATING TO EXTENSION OF WAIVER AUTHORITY UNDER 
                    SECTION 402.

    (a) Contents of Resolutions.--For purposes of this section, 
the term ``resolution'' means only a joint resolution of the 
two Houses of Congress, the matter after the resolving clause 
of which is as follows: ``That the Congress does not approve 
the extension of the authority contained in section 402(c) of 
the Trade Act of 1974 recommended by the President to the 
Congress on -------- with respect to --------.'', with the 
first blank space being filled with the appropriate date, and 
the second blank space being filled with the names of those 
countries, if any, with respect to which such extension of 
authority is not approved, and with the clause beginning with 
``with-respect-to'' being omitted if the extension of the 
authority is not approved with respect to any country.
    (b) Application of Rules of Section 152; Exceptions.--
          (1) Except as provided in this section, the 
        provisions of section 152 shall apply to resolutions 
        described in subsection (a).
          (2) In applying section 152(c)(1), all calendar days 
        shall be counted.
          (3) That part of section 152(d)(2) which provides 
        that no amendment is in order shall not apply to any 
        amendment to a resolution which is limited to striking 
        out or inserting the names of one or more countries or 
        to striking out or inserting a with-respect-to clause. 
        Debate in the House of Representatives on any amendment 
        to a resolution shall be limited to not more than 1 
        hour which shall be equally divided between those 
        favoring and those opposing the amendment. A motion in 
        the House to further limit debate on an amendment to a 
        resolution is not debatable.
          (4) That part of section 152(e)(4) which provides 
        that no amendment is in order shall not apply to any 
        amendment to a resolution which is limited to striking 
        out or inserting the names of one or more countries or 
        to striking out or inserting a with-respect-to clause. 
        The time limit on a debate on a resolution in the 
        Senate under section 152(e)(2) shall include all 
        amendments to a resolution. Debate in the Senate on any 
        amendment to a resolution shall be limited to not more 
        than 1 hour, to be equally divided between, and 
        controlled by, the mover and the manager of the 
        resolution, except that in the event the manager of the 
        resolution is in favor of any such amendment, the time 
        in opposition thereto shall be controlled by the 
        minority leader or his designee. The majority leader 
        and minority leader may, from time under the control on 
        the passage of a resolution, allot additional time to 
        any Senator during the consideration of any amendment. 
        A motion in the Senate to further limit debate on an 
        amendment to a resolution is not debatable.
    (c) Consideration of Second Resolution Not in Order.--It 
shall not be in order in either the House of Representatives or 
the Senate to consider a resolution with respect to a 
recommendation of the President under section 402(d) (other 
than a resolution described in subsection (a) received from the 
other House), if that House has adopted a resolution with 
respect to the same recommendation.
    (d) Procedures Relating to Conference Reports in the 
Senate.--
          (1) Consideration in the Senate of the conference 
        report on any joint resolution described in subsection 
        (a), including consideration of all amendments in 
        disagreement (and all amendments thereto), and 
        consideration of all debatable motions and appeals in 
        connection therewith, shall be limited to 10 hours, to 
        be equally divided between, and controlled by, the 
        majority leader and the minority leader or their 
        designees. Debate on any debatable motion or appeal 
        related to the conference report shall be limited to 1 
        hour, to be equally divided between, and controlled by, 
        the mover and the manager of the conference report.
          (2) In any case in which there are amendments in 
        disagreement, time on each amendment shall be limited 
        to 30 minutes, to be equally divided between, and 
        controlled by, the manager of the conference report and 
        the minority leader or his designee. No amendment to 
        any amendment in disagreement shall be received unless 
        it is a germane amendment.

SEC. 154. SPECIAL RULES RELATING TO CONGRESSIONAL PROCEDURES.

    (a) Whenever, pursuant to section 102(e), 203(b), 402(d), 
or 407 (a) or (b), a document is required to be transmitted to 
the Congress, copies of such document shall be delivered to 
both Houses of Congress on the same day and shall be delivered 
to the Clerk of the House of Representatives if the House is 
not in session and to the Secretary of the Senate if the Senate 
is not in session.
    (b) For purposes of sections 203(c), and 407(c)(2), the 90-
day period referred to in such sections shall be computed by 
excluding--
          (1) the days on which either House is not in session 
        because of an adjournment of more than 3 days to a day 
        certain or an adjournment of the Congress sine die, and
          (2) any Saturday and Sunday, not excluded under 
        paragraph (1), when either House is not in session.

  4. Trade Agreement Implementation Authority and Amendment Procedures


      Sections 111(b) and 115 of the Uruguay Round Agreements Act


                  [19 U.S.C. 3521, 3524; P.L. 103-465]

SEC. 111. TARIFF MODIFICATIONS.

           *       *       *       *       *       *       *


    (b) Other Tariff Modifications.--Subject to the 
consultation and layover requirements of section 115, the 
President may proclaim--
          (1) the modification of any duty or staged rate 
        reduction of any duty set forth in Schedule XX if--
                  (A) the United States agrees to such 
                modification or staged rate reduction in a 
                multilateral negotiation under the auspices of 
                the WTO, and
                  (B) such modification or staged rate 
                reduction applies to the rate of duty on an 
                article contained in a tariff category that was 
                the subject of reciprocal duty elimination or 
                harmonization negotiations during the Uruguay 
                Round of multilateral trade negotiations, and
          (2) such modifications as are necessary to correct 
        technical errors in Schedule XX or to make other 
        rectifications to the Schedule.

           *       *       *       *       *       *       *


SEC. 115. CONSULTATION AND LAYOVER REQUIREMENTS FOR, AND EFFECTIVE DATE 
                    OF, PROCLAIMED ACTIONS.

  If a provision of this Act provides that the implementation 
of an action by the President by proclamation is subject to the 
consultation and layover requirements of this section, such 
action may be proclaimed only if--
          (1) the President has obtained advice regarding the 
        proposed action from--
                  (A) the appropriate advisory committees 
                established under section 135 of the Trade Act 
                of 1974 (19 U.S.C. 2155), and
                  (B) the International Trade Commission;
          (2) the President has submitted a report to the 
        Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate that sets forth--
                  (A) the action proposed to be proclaimed and 
                the reasons for such actions, and
                  (B) the advice obtained under paragraph (1);
          (3) a period of 60 calendar days, beginning with the 
        first day on which the President has met the 
        requirements of paragraphs (1) and (2) with respect to 
        such action, has expired; and
          (4) the President has consulted with such committees 
        regarding the proposed action during the period 
        referred to in paragraph (3).

    Sections 103 and 104 of the North American Free Trade Agreement 
                           Implementation Act


                [19 U.S.C. 3313 and 3314; P.L. 103-182]

SEC. 103. CONSULTATION AND LAYOVER REQUIREMENTS FOR, AND EFFECTIVE DATE 
                    OF, PROCLAIMED ACTIONS.

  (a) Consultation and Layover Requirements.--If a provision of 
this Act provides that the implementation of an action by the 
President by proclamation is subject to the consultation and 
layover requirements of this section, such action may be 
proclaimed only if--
          (1) the President has obtained advice regarding the 
        proposed action from--
                  (A) the appropriate advisory committees 
                established under section 135 of the Trade Act 
                of 1974, and
                  (B) the International Trade Commission;
          (2) the President has submitted a report to the 
        Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the 
        Senate that sets forth--
                  (A) the action proposed to be proclaimed and 
                the reasons therefor, and
                  (B) the advice obtained under paragraph (1);
          (3) a period of 60 calendar days, beginning with the 
        first day on which the President has met the 
        requirements of paragraphs (1) and (2) with respect to 
        such action, has expired; and
          (4) the President has consulted with such committees 
        regarding the proposed action during the period 
        referred to in paragraph (3).
    (b) Effective Date of Certain Proclaimed Actions.--Any 
action proclaimed by the President under the authority of this 
Act that is not subject to the consultation and layover 
requirements under subsection (a) may not take effect before 
the 15th day after the date on which the text of the 
proclamation is published in the Federal Register.

SEC. 104. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE AND 
                    INITIAL REGULATIONS.

  (a) Implementing Actions.--After the date of the enactment of 
this Act--
          (1) the President may proclaim such actions; and
          (2) other appropriate officers of the United States 
        Government may issue such regulations;
as may be necessary to ensure that any provision of this Act, 
or amendment made by this Act, that takes effect on the date 
the Agreement enters into force is appropriately implemented on 
such date, but no such proclamation or regulation may have an 
effective date earlier than the date of entry into force. The 
15-day restriction in section 103(b) on the taking effect of 
proclaimed actions is waived to the extent that the application 
of such restriction would prevent the taking effect on the date 
the Agreement enters into force of any action proclaimed under 
this section.
  (b) Initial Regulations.--Initial regulations necessary or 
appropriate to carry out the actions proposed in the statement 
of administrative action submitted under section 101(a)(2) to 
implement the Agreement shall, to the maximum extent feasible, 
be issued within 1 year after the date of entry into force of 
the Agreement; except that interim or initial regulations to 
implement those Uniform Regulations regarding rules of origin 
provided for under article 511 of the Agreement shall be issued 
no later than the date of entry into force of the Agreement. In 
the case of any implementing action that takes effect on a date 
after the date of entry into force of the Agreement, initial 
regulations to carry out that action shall, to the maximum 
extent feasible, be issued within 1 year after such effective 
date.

       Sections 2(a) and 3(c) of the Trade Agreements Act of 1979


                   [19 U.S.C. 2503, 2504; P.L. 96-39]

SEC. 2. APPROVAL OF TRADE AGREEMENTS.

    (a) Approval of Agreements and Statements of Administrative 
Action.--In accordance with the provisions of sections 102 and 
151 of the Trade Act of 1974 (19 U.S.C. 2112 and 2191), the 
Congress approves the trade agreements described in subsection 
(c) submitted to the congress on June 19, 1979, and the 
statements of administrative action proposed to implement such 
trade agreements submitted to the Congress on that date.

SEC. 3. RELATIONSHIP OF TRADE AGREEMENTS TO UNITED STATES LAW.

           *       *       *       *       *       *       *


    (c) Changes in Statutes To Implement a Requirement, 
Amendment, or Recommendation.--
          (1) Presidential determination.--Whenever the 
        President determines that it is necessary or 
        appropriate to amend, repeal, or enact a statute of the 
        United States in order to implement any requirement of, 
        amendment to, or recommendation under such an 
        agreement, he shall submit to the Congress a draft of a 
        bill to accomplish the amendment, repeal, or enactment 
        and a statement of any administrative action proposed 
        to implement the requirement, amendment, or 
        recommendation. Not less than 30 days before submitting 
        such a bill, the President shall consult with the 
        Committee on Ways and Means of the House of 
        Representatives, the Committee on Finance of the 
        Senate, and each committee of the House or Senate which 
        has jurisdiction over legislation involving subject 
        matters which would be affected by such amendment, 
        repeal, or enactment. The consultation shall treat all 
        matters relating to the implementation of such 
        requirement, amendment, or recommendation, as provided 
        in paragraphs (2) and (3).
          (2) Conditions for taking effect under united states 
        law.--No such amendment shall enter into force with 
        respect to the United States, and no such requirement, 
        amendment, or recommendation shall be implemented under 
        United States law, unless--
                  (A) the President, after consultation with 
                the Congress under paragraph (1), notifies the 
                House of Representatives and the Senate of his 
                determination and publishes notice of that 
                determination in the Federal Register,
                  (B) the President transmits a document to the 
                House of Representatives and to the Senate 
                containing a copy of the text of such 
                requirement, amendment, or recommendation, 
                together with--
                          (i) a draft of a bill to amend or 
                        repeal provisions of existing statutes 
                        or to create statutory authority and an 
                        explanation as to how the bill and any 
                        proposed administrative action affect 
                        existing law, and
                          (ii) a statement of how the 
                        requirement, amendment, or 
                        recommendation serves the interests of 
                        United States commerce and why the 
                        legislative and administrative action 
                        is necessary or appropriate to carry 
                        out the requirement, amendment, or 
                        recommendation, and
                  (C) the bill submitted by the President is 
                enacted into law.
          (3) Recommendations as to application.--The President 
        may make the same type of recommendations, in the same 
        manner and subject to the same conditions, to the 
        Congress with respect to the application of any such 
        requirement, amendment, or recommendation as he may 
        make, under section 102(f) of the Trade Act of 1974, 
        with respect to a trade agreement.
          (4) Congressional procedures applicable.--The bill 
        submitted by the President shall be introduced in 
        accordance with the provisions of subsection (c)(1) of 
        section 151 of the Trade Act of 1974, and the 
        provisions of subsections (d), (e), (f), and (g) of 
        such section shall apply to the consideration of the 
        bill. For the purpose of applying section 151 of such 
        Act to such bill--
                  (A) the term ``trade agreement'' shall be 
                treated as a reference to the requirement, 
                amendment, or recommendation, and
                  (B) the term ``implementing bill'' or 
                ``implementing revenue bill'', whichever is 
                appropriate, shall be treated as a reference to 
                the bill submitted by the President.

                          B. EXECUTIVE BRANCH


                   1. Interagency Trade Organization


       Section 242 of the Trade Expansion Act of 1962, as amended


 [19 U.S.C. 1872; P.L. 87-794, as amended by P.L. 93-618, P.L. 96-39, 
          Reorganization Plan No. 3 of 1979, and P.L. 100-418]

SEC. 242. INTERAGENCY TRADE ORGANIZATION.

    (a)(1) The President shall establish an interagency 
organization.
    (2) The functions of the organization are--
          (A) to assist, and make recommendations to, the 
        President in carrying out the functions vested in him 
        by the trade laws and to advise the United States Trade 
        Representative (hereinafter in this section referred to 
        as the ``Trade Representative'') in carrying out the 
        functions set forth in section 141 of the Trade Act of 
        1974;
          (B) to assist the President, and advise the Trade 
        Representative, with respect to the development and 
        implementation of the international trade policy 
        objectives of the United States; and
          (C) to advise the President and the Trade 
        Representative with respect to the relationship between 
        the international trade policy objectives of the United 
        States and other major policy areas which may 
        significantly affect the overall international trade 
        policy and trade competitiveness of the United States.
    (3) The interagency organization shall be composed of the 
following:
          (A) The Trade Representative, who shall be 
        chairperson.
          (B) The Secretary of Commerce.
          (C) The Secretary of State.
          (D) The Secretary of the Treasury.
          (E) The Secretary of Agriculture.
          (F) The Secretary of Labor.
The Trade Representative may invite representatives from other 
agencies, as appropriate, to attend particular meetings if 
subject matters of specific functional interest to such 
agencies are under consideration. It shall meet at such times 
and with respect to such matters as the President or the 
Chairman shall direct.
    (b) In assisting the President, the organization shall--
          (1) make recommendations to the President on basic 
        policy issues arising in the administration of the 
        trade agreements program,
          (2) make recommendations to the President as to what 
        action, if any, he should take on reports submitted to 
        him by the United States International Trade Commission 
        under section 201(d) of the Trade Act of 1974,
          (3) advise the President of the results of hearings 
        held pursuant to section 302(b)(2) of the Trade Act of 
        1974, and recommend appropriate action with respect 
        thereto, and
          (4) perform such other functions with respect to the 
        trade agreements program as the President may from time 
        to time designate.
In carrying out its functions under this subsection, the 
organization shall take into account the advice of the 
congressional advisers and private sector advisory committees, 
as well as that of any committee or other body established to 
advise the department, agency, or office which a member of the 
organization heads.
    (c) The organization shall, to the maximum extent 
practicable, draw upon the resources of the agencies 
represented in the organization, as well as such other agencies 
as it may determine, including the United States International 
Trade Commission. In addition, the President may establish by 
regulation such procedures and committees as he may determine 
to be necessary to enable the organization to provide for the 
conduct of hearings pursuant to section 302(b)(2) of the Trade 
Act of 1974, and for the carrying out of other functions 
assigned to the organization pursuant to this section.
    [Section 1621(b) of the Omnibus Trade and Competitiveness 
Act of 1988, in referring to section 242(a) as amended by 
section 1621(a) of that Act, states:
          [It is the sense of Congress that the interagency 
        organization established under subsection (a) should be 
        the principal interagency forum within the executive 
        branch on international trade policy matters.]

                   Reorganization Plan No. 3 of 1979


                         [19 U.S.C. 2171 note]

    Prepared by the President and transmitted to the Senate and 
the House of Representatives in Congress assembled, September 
25, 1979, pursuant to the provisions of chapter 9 of title 5 of 
the United States Code, as amended by P.L. 97-377.

      reorganization of functions relating to international trade

SECTION 1. OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE.

    (a) The Office of the Special Representative for Trade 
Negotiations is redesignated the Office of the United States 
Trade Representative.
    (b)(1) The Special Representative for Trade Negotiations is 
redesignated the United States Trade Representative 
(hereinafter referred to as the ``Trade Representative''). The 
Trade Representative shall have primary responsibility, with 
the advice of the interagency organization established under 
section 242 of the Trade Expansion Act of 1962 (19 U.S.C. 1872) 
(hereinafter referred to as the ``Committee''), for developing, 
and for coordinating the implementation of, United States 
international trade policy, including commodity matters and, to 
the extent they are related to international trade policy, 
direct investment matters. The Trade Representative shall serve 
as the principal advisor to the President on international 
trade policy and shall advise the President on the impact of 
other policies of the United States Government on international 
trade.
    (2) The Trade Representative shall have lead responsibility 
for the conduct of international trade negotiations including 
commodity and direct investment negotiations in which the 
United States participates.
    (3) To the extent necessary to assure the coordination of 
international trade policy, and consistent with any other law, 
the Trade Representative, with the advice of the Committee, 
shall issue policy guidance to departments and agencies on 
basic issues of policy and interpretation arising in the 
exercise of the following international trade functions. Such 
guidance shall determine the policy of the United States with 
respect to international trade issues arising in the exercise 
of such functions:
          (A) matters concerning the General Agreement on 
        Tariffs and Trade, including implementation of the 
        trade agreements set forth in section 2(c) of the Trade 
        Agreements Act of 1979; United States Government 
        positions on trade and commodity matters dealt with by 
        the Organization for Economic Cooperation and 
        Development, the United Nations Conference on Trade and 
        Development, and other multilateral organizations; and 
        the assertion and protection of the rights of the 
        United States under bilateral and multilateral 
        international trade and commodity agreements;
          (B) expansion of exports from the United States;
          (C) policy research on international trade, 
        commodity, and direct investment matters;
          (D) to the extent permitted by law, overall United 
        States policy with regard to unfair trade practices, 
        including enforcement of countervailing duties and 
        antidumping functions under section 303 and title VII 
        of the Tariff Act of 1930;
          (E) bilateral trade and commodity issues, including 
        East-West trade matters; and
          (F) international trade issues involving energy.
    (4) All functions of the Trade Representative shall be 
conducted under the direction of the President.
    (c) The Deputy Special Representatives for Trade 
Negotiations are redesignated Deputy United States Trade 
Representatives.

SEC. 2. DEPARTMENT OF COMMERCE.

    (a) The Secretary of Commerce (hereinafter referred to as 
the ``Secretary'') shall have, in addition to any other 
functions assigned by law, general operational responsibility 
for major nonagricultural international trade functions of the 
United States Government, including export development, 
commercial representation abroad, the administration of the 
antidumping and countervailing duty laws, export controls, 
trade adjustment assistance to firms and communities, research 
and analysis, and monitoring compliance with international 
trade agreements to which the United States is a party.
    (b)(1) There shall be in the Department of Commerce 
(hereinafter referred to as the ``Department'') a Deputy 
Secretary appointed by the President, by and with the advice 
and consent of the Senate. The Deputy Secretary shall receive 
compensation at the rate payable for Level II of the Executive 
Schedule, and shall perform such duties and exercise such 
powers as the Secretary may from time to time prescribe.
    (2) The position of Under Secretary of Commerce established 
under section 1 of the Act of June 5, 1939 (ch. 180, 53 Stat. 
808; 15 U.S.C. 1502) is abolished.
    (c) There shall be in the Department an Under Secretary for 
International Trade appointed by the President, by and with the 
advice and consent of the Senate. The Under Secretary for 
International Trade shall receive compensation at the rate 
payable for Level III of the Executive Schedule, and shall 
perform such duties and exercise such powers as the Secretary 
may from time to time prescribe.
    (d) There shall be in the Department two additional 
Assistant Secretaries appointed by the President, by and with 
the advice and consent of the Senate. Each such Assistant 
Secretary shall perform such duties and exercise such powers as 
the Secretary may from time to time prescribe.
    (e) There shall be in the Department of Commerce a Director 
General of the United States and Foreign Commercial Services 
who shall be appointed by the President, by and with the advice 
and consent of the Senate, and shall receive compensation at 
the rate prescribed by law for level IV of the Executive 
Schedule.

SEC. 3. EXPORT-IMPORT BANK OF THE UNITED STATES.

    The Trade Representative and the Secretary shall serve, ex 
officio and without vote, as additional members of the Board of 
Directors of the Export-Import Bank of the United States.

SEC. 4. OVERSEAS PRIVATE INVESTMENT CORPORATION.

    (a) The Trade Representative shall serve, ex officio, as an 
additional voting member of the Board of Directors of the 
Overseas Private Investment Corporation. The Trade 
Representative shall be the Vice Chair of such Board.
    (b) There shall be an additional member of the Board of 
Directors of the Overseas Private Investment Corporation who 
shall be appointed by the President of the United States, by 
and with the advice and consent of the Senate, and who shall 
not be an official or employee of the Government of the United 
States. Such Director shall be appointed for a term of no more 
than three years.

SEC. 5. TRANSFER OF FUNCTIONS.

    (a)(1) There are transferred to the Secretary all functions 
of the Secretary of the Treasury, the General Counsel of the 
Department of the Treasury, or the Department of the Treasury 
pursuant to the following:
          (A) section 305(b) of the Trade Agreements Act of 
        1979 (19 U.S.C. 215(b)), to be exercised in 
        consultation with the Secretary of the Treasury;
          (B) section 232 of the Trade Expansion Act of 1962 
        (19 U.S.C. 1862);
          (C) section 303 and title VII (including section 
        77(1)) of the Tariff Act of 1930 (19 U.S.C. 1303, 1671 
        et seq.), except that the Customs Service of the 
        Department of the Treasury shall accept such deposits, 
        bonds, or other security as deemed appropriate by the 
        Secretary, shall assess and collect such duties as may 
        be directed by the Secretary, and shall furnish such of 
        its important records or copies thereof as may be 
        requested by the Secretary incident to the functions 
        transferred by this subparagraph;
          (D) sections 514, 515, and 516 of the Tariff Act of 
        1930 (19 U.S.C. 1514, 1515, and 1516) insofar as they 
        relate to any protest, petition, or notice of desire to 
        contest described in section 1002(b)(1) of the Trade 
        Agreements Act of 1979;
          (E) with respect to the functions transferred by 
        subparagraph (C) of this paragraph, section 318 of the 
        Tariff Act of 1930 (19 U.S.C. 1318), to be exercised in 
        consultation with the Secretary of the Treasury;
          (F) with respect to the functions transferred by 
        subparagraph (C) of this paragraph, section 502(b) of 
        the Tariff Act of 1930 (19 U.S.C. 1502(b)), and, 
        insofar as it provides authority to issue regulations 
        and disseminate information, to be exercised in 
        consultation with the Secretary of the Treasury to the 
        extent that the Secretary of the Treasury has 
        responsibility under subparagraph (C), section 502(a) 
        of such Act (19 U.S.C. 1502(a));
          (G) with respect to the functions transferred by 
        subparagraph (C) of this paragraph, section 617 of the 
        Tariff Act of 1930 (19 U.S.C. 1617); and
          (H) section 2632(e) of title 28 of the United States 
        Code, insofar as it relates to actions taken by the 
        Secretary reviewable under section 516A of the Tariff 
        Act of 1930 (19 U.S.C. 1516(a)).
    (2) The Secretary shall consult with the Trade 
Representative regularly in exercising the functions 
transferred by subparagraph (C) of paragraph (1) of this 
subsection, and shall consult with the Trade Representative 
regarding any substantive regulation proposed to be issued to 
enforce such functions.
    (b)(1) There are transferred to the Secretary all trade 
promotion and commercial functions of the Secretary of State or 
the Department of State that are--
          (A) performed in full-time overseas trade promotion 
        and commercial positions; or
          (B) performed in such countries as the President may 
        from time to time prescribe.
    (2) To carry out the functions transferred by paragraph (1) 
of this subsection, the President, to the extent he deems it 
necessary, may authorize the Secretary to utilize Foreign 
Service personnel authorities and to exercise the functions 
vested in the Secretary of State by the Foreign Service Act of 
1946 (22 U.S.C. 801 et seq.) and by any other laws with respect 
to personnel performing such functions.
    (c) There are transferred to the President all functions of 
the East-West Foreign Trade Board under section 411(c) of the 
Trade Act of 1974 (19 U.S.C. 2441(c)).
    (d) Appropriations available to the Department of State for 
Fiscal Year 1980 for representation of the United States 
concerning matters arising under the General Agreement on 
Tariffs and Trade and trade and commodity matters dealt with 
under the auspices of the United Nations Conference on Trade 
and Development are transferred to the Trade Representative.
    (e) There are transferred to the interagency organization 
established under section 242 of the Trade Expansion Act of 
1962 (19 U.S.C. 1872) all functions of the East-West Foreign 
Trade Board under section 411 (a) and (b) of the Trade Act of 
1974 (19 U.S.C. 2441(a) and (b)).

SEC. 6. ABOLITION.

    The East-West Foreign Trade Board established under section 
411 of the Trade Act of 1974 (19 U.S.C. 2441) is abolished.

SEC. 7. RESPONSIBILITY OF THE SECRETARY OF STATE.

    Nothing in this reorganization plan is intended to derogate 
from the responsibility of the Secretary of State for advising 
the President on foreign policy matters, including the foreign 
policy aspects of international trade and trade related 
matters.

SEC. 8. INCIDENTAL TRANSFERS: INTERIM OFFICERS.

    (a) So much of the personnel, property, records, and 
unexpended balances of appropriations, allocations, and other 
funds employed, used, held available or to be made available in 
connection with the functions transferred under this 
reorganization plan as the Director of the Office of Management 
and Budget shall determine shall be transferred to the 
appropriate agency, organization, or component at such time or 
times as such Director shall provide, except that no such 
unexpended balances transferred shall be used for purposes 
other than those for which the appropriation originally was 
made. The Director of the Office of Management and Budget shall 
provide for terminating the affairs of any agency abolished 
herein and for such further measures and dispositions as such 
Director deems necessary to effectuate the purposes of the 
reorganization plan.
    (b) Pending the assumption of office by the initial 
officers provided for in section 2 of this reorganization plan, 
the functions of each such office may be performed, for up to a 
total of 60 days, by such individuals as the President may 
designate. Any individual so designated shall be compensated at 
the rate provided herein for such position.

SEC. 9. EFFECTIVE DATE.

    The provisions of this reorganization plan shall take 
effect October 1, 1980, or at such earlier time or times as the 
President shall specify, but not sooner than the earliest time 
allowable under section 906 of title 5 of the United States 
Code.

            Section 306 of the Trade and Tariff Act of 1984


                [19 U.S.C. 2114b and 2114c; P.L. 98-573]

SEC. 306. PROVISIONS RELATING TO INTERNATIONAL TRADE IN SERVICES.

    (a)(1) The Secretary of Commerce shall establish a service 
industries development program designed to--
          (A) develop, in consultation with other Federal 
        agencies as appropriate, policies regarding services 
        that are designed to increase the competitiveness of 
        United States service industries in foreign commerce;
          (B) develop a data base for assessing the adequacy of 
        Government policies and actions pertaining to services, 
        including, but not limited to, data on trade, both 
        aggregate and pertaining to individual service 
        industries;
          (C) collect and analyze, in consultation with 
        appropriate agencies, information pertaining to the 
        international operations and competitiveness of United 
        States service industries, including information with 
        respect to--
                  (i) policies of foreign governments toward 
                foreign and United States service industries;
                  (ii) Federal, State, and local regulation of 
                both foreign and United States suppliers of 
                services, and the effect of such regulation on 
                trade;
                  (iii) the adequacy of current United States 
                policies to strengthen the competitiveness of 
                United States service industries in foreign 
                commerce, including export promotion activities 
                in the service sector;
                  (iv) tax treatment of services, with 
                particular emphasis on the effect of United 
                States taxation on the international 
                competitiveness of United States firms and 
                exports;
                  (v) treatment of services under international 
                agreements of the United States;
                  (vi) antitrust policies as such policies 
                affect the competitiveness of United States 
                firms; and
                  (vii) treatment of services in international 
                agreements of the United States;
          (D) conduct a program of research and analysis of 
        service-related issues and problems, including 
        forecasts and industrial strategies; and
          (E) conduct sectoral studies of domestic service 
        industries.
    (2) For purposes of the collection and analysis required by 
paragraph (1), and for the purpose of any reporting the 
Department of Commerce makes under paragraph (3), such 
collection and reporting shall distinguish between income from 
investment and income from noninvestment services.
    (3) On not less than a biennial basis beginning in 1986, 
the Secretary shall prepare a report which analyzes the 
information collected under paragraph (1). Such report shall be 
submitted to the Congress and to the President by not later 
than the date that is 120 days after the close of the period 
covered by the report.
    (4) The Secretary of Commerce shall carry out the 
provisions of this subsection from funds otherwise made 
available to him which may be used for such purposes.
    (5) For purposes of this section, the term ``services'' 
means economic activities whose outputs are other than tangible 
goods. Such term includes, but is not limited to, banking, 
insurance, transportation, communications and data processing, 
retail and wholesale trade, advertising, accounting, 
construction, design and engineering, management consulting, 
real estate, professional services, entertainment, education, 
health care, and tourism.
    [(b) Amendments to the International Investment Survey Act 
of 1976.]
    (c)(1)(A) The United States Trade Representative, through 
the interagency trade organization established pursuant to 
section 242(a) of the Trade Expansion Act of 1962 or any 
subcommittee thereof, shall, in conformance with this Act and 
other provisions of law, develop (and coordinate the 
implementation of) United States policies concerning trade in 
services.
    (c)(2)(A) The President shall, as he deems appropriate--
          (i) consult with State governments on issues of trade 
        policy, including negotiating objectives and 
        implementation of trade agreements, affecting the 
        regulatory authority of non-Federal governments, or 
        their procurement of goods and services;
          (ii) establish one or more intergovernmental policy 
        advisory committees on trade which shall serve as a 
        principal forum in which State and local governments 
        may consult with the Federal Government with respect to 
        the matters described in clause (i); and
          (iii) provide to State and local governments and to 
        United States service industries, upon their request, 
        advice, assistance, and (except as may be otherwise 
        prohibited by law) data, analyses, and information 
        concerning United States policies on international 
        trade in services.
    [(13) Amendments to section 135 of the Trade Act of 1974 on 
private sector advisors (reprinted elsewhere).]

          2. Office of the United States Trade Representative


          Section 141 of the Trade Act of 1974, as amended \1\


 [19 U.S.C. 2171; P.L. 93-618, as amended by Reorganization Plan No. 3 
 of 1979, P.L. 97-456, P.L. 98-573, P.L. 99-272, P.L. 99-514, P.L. 100-
 203, P.L. 100-418, P.L. 101-207, P.L. 101-382, P.L. 103-465, and P.L. 
                                104-65]

SEC. 141. OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE.

    (a) There is established within the Executive Office of the 
President the Office of the United States Trade Representative 
(hereinafter in this section referred to as the ``Office'').
---------------------------------------------------------------------------
    \1\ Section 241, Trade Expansion Act of 1962 (P.L. 87-794), was 
repealed by P.L. 93-618.
---------------------------------------------------------------------------
    (b)(1) The Office shall be headed by the United States 
Trade Representative who shall be appointed by the President, 
by and with the advice and consent of the Senate. As an 
exercise of the rulemaking power of the Senate, any nomination 
of the United States Trade Representative submitted to the 
Senate for confirmation, and referred to a committee, shall be 
referred to the Committee on Finance. The United States Trade 
Representative shall hold office at the pleasure of the 
President, shall be entitled to receive the same allowances as 
a chief of mission, and shall have the rank of Ambassador 
Extraordinary and Plenipotentiary.
    (2) There shall be in the Office three Deputy United States 
Trade Representatives and one Chief Agricultural Negotiator who 
shall be appointed by the President, by and with the advice and 
consent of the Senate. As an exercise of the rulemaking power 
of the Senate, any nomination of a Deputy United States Trade 
Representative or Chief Agrcultural Negotiator submitted to the 
Senate for its advice and consent, and referred to a committee, 
shall be referred to the Committee on Finance. Each Deputy 
United States Trade Representative and the Chief Agricultural 
Negotiator shall hold office at the pleasure of the President 
and shall have the rank of Ambassador.
    (3) A person who has directly represented, aided, or 
advised a foreign entity (as defined by section 207(f)(3) of 
title 18, United States Code) in any trade negotiation, or 
trade dispute, with the United States may not be appointed as 
United States Trade Representative or as a Deputy United States 
Trade Representative.
    [(3) Amendment to title 5, section 5312, United States 
Code, added the Trade Representative to the list of positions 
at level I of the Executive Schedule.]
    (c)(1) The United States Trade Representative shall--
          (A) have primary responsibility for developing, and 
        for coordinating the implementation of, United States 
        international trade policy, including commodity 
        matters, and, to the extent they are related to 
        international trade policy, direct investment matters;
          (B) serve as the principal advisor to the President 
        on international trade policy and shall advise the 
        President on the impact of other policies of the United 
        States Government on international trade;
          (C) have lead responsibility for the conduct of, and 
        shall be the chief representative of the United States 
        for, international trade negotiations, including all 
        negotiations on any matter considered under the 
        auspices of the World Trade Organization, commodity and 
        direct investment negotiations, in which the United 
        States participates;
          (D) issue and coordinate policy guidance to 
        departments and agencies on basic issues of policy and 
        interpretation arising in the exercise of international 
        trade functions including any matter considered under 
        the auspices of the World Trade Organization, to the 
        extent necessary to assure the coordination of 
        international trade policy and consistent with any 
        other law;
          (E) act as the principal spokesman of the President 
        on international trade;
          (F) report directly to the President and the Congress 
        regarding, and be responsible to the President and the 
        Congress for the administration of, trade agreements 
        programs;
          (G) advise the President and Congress with respect to 
        nontariff barriers to international trade, 
        international commodity agreements, and other matters 
        which are related to the trade agreements programs;
          (H) be responsible for making reports to Congress 
        with respect to matters referred to in subparagraphs 
        (C) and (F);
          (I) be chairman of the interagency trade organization 
        established under section 242(a) of the Trade Expansion 
        Act of 1962, and shall consult with and be advised by 
        such organization in the performance of his functions; 
        and
          (J) in addition to those functions that are delegated 
        to the United States Trade Representative as of the 
        date of the enactment of the Omnibus Trade and 
        Competitiveness Act of 1988, be responsible for such 
        other functions as the President may direct.
  (2) It is the sense of Congress that the United States Trade 
Representative should--
          (A) be the senior representative on any body that the 
        President may establish for the purpose of providing to 
        the President advice on overall economic policies in 
        which international trade matters predominate; and
          (B) be included as a participant in all economic 
        summit and other international meetings at which 
        international trade is a major topic.
    (3) The United States Trade Representative may--
          (A) delegate any of his functions, powers, and duties 
        to such officers and employees of the Office as he may 
        designate; and
          (B) authorize such successive redelegations of such 
        functions, powers, and duties to such officers and 
        employees of the Office as he may deem appropriate.
    (4) Each Deputy United States Trade Representative shall 
have as his principal function the conduct of trade 
negotiations under this chapter and shall have such other 
functions as the United States Trade Representative may direct.
    (5) The principal function of the Chief Agricultural 
Negotiator shall be to conduct trade negotiations and to 
enforce trade agreements relating to United States agricultural 
products and services. The Chief Agricultural Negotiator shall 
be a vigorous advocate on behalf of United States agricultural 
interests. The Chief Agricultural Negotiator shall perform such 
other functions as the United States Trade Representative may 
direct.
    (d)(1) In carrying out subsection (c) with respect to 
unfair trade practices, the United States Trade Representative 
shall--
          (A) coordinate the application of interagency 
        resources to specific unfair trade practice cases;
          (B) identify, and refer to the appropriate Federal 
        department or agency for consideration with respect to 
        action, each act, policy, or practice referred to in 
        the report required under section 181(b), or otherwise 
        known to the United States Trade Representative on the 
        basis of other available information, that may be an 
        unfair trade practice that either--
                  (i) is considered to be inconsistent with the 
                provisions of any trade agreement and has a 
                significant adverse impact on United States 
                commerce, or
                  (ii) has a significant adverse impact on 
                domestic firms or industries that are either 
                too small or financially weak to initiate 
                proceedings under the trade laws;
          (C) identify practices having a significant adverse 
        impact on United States commerce that the attainment of 
        United States negotiating objectives would eliminate; 
        and
          (D) identify, on a biennial basis, those United 
        States Government policies and practices that, if 
        engaged in by a foreign government, might constitute 
        unfair trade practices under United States law.
    (2) For purposes of carrying out paragraph (1), the United 
States Trade Representative shall be assisted by an interagency 
unfair trade practices advisory committee composed of the Trade 
Representative, who shall chair the committee, and senior 
representatives of the following agencies, appointed by the 
respective heads of those agencies:
          (A) The Bureau of Economics and Business Affairs of 
        the Department of State.
          (B) The United States and Foreign Commercial Services 
        of the Department of Commerce.
          (C) The International Trade Administration (other 
        than the United States and Foreign Commercial Service) 
        of the Department of Commerce.
          (D) The Foreign Agricultural Service of the 
        Department of Agriculture.
The United States Trade Representative may also request the 
advice of the United States International Trade Commission 
regarding the carrying out of paragraph (1).
    (3) For purposes of this subsection, the term ``unfair 
trade practice'' means any act, policy, or practice that--
          (A) may be a subsidy with respect to which 
        countervailing duties may be imposed under subtitle A 
        of title VII;
          (B) may result in the sale or likely sale of foreign 
        merchandise with respect to which antidumping duties 
        may be imposed under subtitle B of title VII;
          (C) may be either an unfair method of competition, or 
        an unfair act in the importation of articles into the 
        United States, that is unlawful under section 337; or
          (D) may be an act, policy, or practice of a kind with 
        respect to which action may be taken under title III of 
        the Trade Act of 1974.
    (e) The United States Trade Representative may, for the 
purpose of carrying out his functions under this section--
          (1) subject to the civil service and classification 
        laws, select, appoint, employ, and fix the compensation 
        of such officers and employees as are necessary and 
        prescribe their authority and duties, except that not 
        more than 20 individuals may be employed without regard 
        to any provision of law regulating the employment or 
        compensation at rates not to exceed the rate of pay for 
        level IV of the Executive schedule in section 5314 of 
        title 5, United States Code;
          (2) employ experts and consultants in accordance with 
        section 3109 of Title 5, and compensate individuals so 
        employed for each day (including traveltime) at rates 
        not in excess of the maximum rate of pay for grade GS-
        18 as provided in section 5332 of Title 5, and while 
        such experts and consultants are so serving away from 
        their homes or regular place of business, to pay such 
        employees travel expenses and per diem in lieu of 
        subsistence at rates authorized by section 5703 of 
        Title 5 for persons in Government service employed 
        intermittently;
          (3) promulgate such rules and regulations as may be 
        necessary to carry out the functions, powers and duties 
        vested in him;
          (4) utilize, with their consent, the services, 
        personnel, and facilities of other Federal agencies;
          (5) enter into and perform such contracts, leases, 
        cooperative agreements, or other transactions as may be 
        necessary in the conduct of the work of the Office and 
        on such terms as the United States Trade Representative 
        may deem appropriate, with any agency or 
        instrumentality of the United States, or with any 
        public or private person, firm, association, 
        corporation, or institution;
          (6) accept voluntary and uncompensated services, 
        notwithstanding the provisions of 1342 of title 31, 
        United States Code;
          (7) adopt an official seal, which shall be judicially 
        noticed;
          (8) pay for expenses approved by him for official 
        travel without regard to the Federal Travel Regulations 
        or to the provisions of subchapter I of chapter 57 of 
        Title 5 [5 U.S.C. Sec. 5701 et seq.] (relating to rates 
        of per diem allowances in lieu of subsistence 
        expenses);
          (9) accept, hold, administer, and utilize gifts, 
        devises, and bequests of property, both real and 
        personal, for the purpose of aiding or facilitating the 
        work of the Office;
          (10) acquire, by purchase or exchange, not more than 
        two passenger motor vehicles for use abroad, except 
        that no vehicle may be acquired at a cost exceeding 
        $9,500; and
          (11) provide, where authorized by law, copies of 
        documents to persons at cost, except that any funds so 
        received shall be credited to, and be available for use 
        from, the account from which expenditures relating 
        thereto were made.
    (f) The United States Trade Representative shall, to the 
extent he deems it necessary for the proper administration and 
execution of the trade agreements programs of the United 
States, draw upon the resources of, and consult with, Federal 
agencies in connection with the performance of his functions.
    (g)(1)(A) There are authorized to be appropriated to the 
Office for the purposes of carrying out its functions not to 
exceed the following:
          (i) $23,250,000 for fiscal year 1991.
          (ii) $21,077,000 for fiscal year 1992.
    (B) Of the amounts authorized to be appropriated under 
subparagraph (A) for any fiscal year--
          (i) not to exceed $98,000 may be used for 
        entertainment and representation expenses of the 
        Office;
          (ii) not to exceed $2,050,000 may be used to pay the 
        United States share of the expenses of binational 
        panels and extraordinary challenge committees convened 
        pursuant to chapter 19 of the United States-Canada Free 
        Trade Agreement; and
          (iii) not to exceed $1,000,000 shall remain available 
        until expended.
    (2) For the fiscal year beginning October 1, 1982, and for 
each fiscal year thereafter, there are authorized to be 
appropriated to the Office for the salaries of its officers and 
employees such additional sums as may be provided by law to 
reflect pay rate changes made in accordance with the Federal 
Pay Comparability Act of 1970 [5 U.S.C. Sec. 5301 et seq.].

          Section 117 of the Trade and Development Act of 2000


                     [19 U.S.C. 3724; P.L. 106-200]

SEC. 117. ASSISTANT UNITED STATES TRADE REPRESENTATIVE FOR AFRICAN 
                    AFFAIRS.

It is the sense of the Congress that--
    (1) The position of Assistant United States Trade 
Representative for African Affairs is integral to the United 
States commitment to increasing United States-sub-Saharan 
African trade and investment;
    (2) the position of Assistant United States Trade 
Representative for African Affairs should be maintained within 
the Office of the United States Trade Representative to direct 
and coordinate interagency activities on United States-Africa 
trade policy and investment matters and serve as--
          (A) a primary point of contact in the executive 
        branch for those persons engaged in trade between the 
        United States and sub-Saharan Africa; and
          (B) the chief advisor to the United States Trade 
        Representative on issues of trade and investment with 
        Africa; and
    (3) the United States Trade Representative should have 
adequate funding and staff to carry out the duties of the 
Assistant United States Trade Representative for African 
Affairs described in paragraph (2), subject to the availability 
of appropriations.

            C. UNITED STATES INTERNATIONAL TRADE COMMISSION


              1. Organization, General Powers, Procedures


   Sections 330, 331, 333-335, and 339 of the Tariff Act of 1930, as 
                                amended


[19 U.S.C. 1330, 1331, 1333-1335, and 1339; P.L. 71-361, as amended by 
Act of June 25, 1936, Act of June 25, 1948, Act of May 24, 1949, Act of 
Aug. 7, 1953, P.L. 85-686, P.L. 91-452, P.L. 93-618, P.L. 94-455, P.L. 
  95-106, P.L. 95-430, P.L. 97-456, P.L. 98-573, P.L. 99-272, P.L. 99-
 514, P.L. 100-203, P.L. 100-418, P.L. 100-647, P.L. 101-207, P.L. 101-
                         382, and P.L. 102-185]

SEC. 330. ORGANIZATION OF COMMISSION.

    (a) Membership.--The United States International Trade 
Commission (referred to in this Act as the ``Commission'') 
shall be composed of six commissioners who shall be appointed 
by the President, by and with the advice and consent of the 
Senate. No person shall be eligible for appointment as a 
commissioner unless he is a citizen of the United States, and, 
in the judgment of the President, is possessed of 
qualifications requisite for developing expert knowledge of 
international trade problems and efficiency in administering 
the duties and functions of the Commission. A person who has 
served as a commissioner for more than 5 years (excluding 
service as a commissioner before January 3, 1975) shall not be 
eligible for reappointment as a commissioner. Not more than 
three of the commissioners shall be members of the same 
political party, and in making appointments members of 
different political parties shall be appointed alternately as 
nearly as may be practicable.
    (b) Terms of Office.--The terms of office of the 
commissioners holding office on January 3, 1975, which (but for 
this sentence) would expire on June 16, 1975, June 16, 1976, 
June 16, 1977, June 16, 1978, June 16, 1979, and June 16, 1980, 
shall expire on December 16, 1976, June 16, 1978, December 16, 
1979, June 16, 1981, December 16, 1982, and June 16, 1984, 
respectively. The term of office of each commissioner appointed 
after such date shall expire 9 years from the date of the 
expiration of the term for which his predecessor was appointed, 
except that--
          (1) any commissioner appointed to fill a vacancy 
        occurring prior to the expiration of the term for which 
        his predecessor was appointed shall be appointed for 
        the remainder of such term, and
          (2) any commissioner may continue to serve as a 
        commissioner after an expiration of his term of office 
        until his successor is appointed and qualified.
    (c) Chairman and Vice Chairman; Quorum.--(1) The chairman 
and the vice chairman of the Commission shall be designated by 
the President from among the members of the Commission not 
ineligible, under paragraph (3), for designation. The President 
shall notify the Congress of his designations under this 
paragraph. If, as of the date on which a term begins under 
paragraph (2), the President has not designated the chairman of 
the Commission for such term, the Commissioner who, as of such 
date--
          (A) is a member of a different political party than 
        the chairman of the Commission for the immediately 
        preceding term, and
          (B) has the longest period of continuous service as a 
        commissioner,
shall serve as chairman of the Commission for the portion of 
such term preceding the date on which an individual designated 
by the President takes office as chairman.
    (2) After June 16, 1978, the terms of office for the 
chairman and vice chairman of the Commission shall be as 
follows:
          (A) The first term of office occurring after such 
        date shall begin on June 17, 1978, and end at the close 
        of June 16, 1980.
          (B) Each term of office thereafter shall begin on the 
        day after the closing date of the immediately preceding 
        term of office and end at the close of the 2-year 
        period beginning on such day.
    (3)(A) The President may not designate as the chairman of 
the Commission for any term any Commissioner who is a member of 
the political party of which the chairman of the Commission for 
the immediately preceding term is a member, or who has less 
than 1 year of continuous service as a commissioner as of the 
date such designation is being made.
    (B) The President may not designate as the vice chairman of 
the Commission for any term any commissioner who is a member of 
the political party of which the chairman for that term is a 
member.
    (C) If any commissioner does not complete a term as 
chairman or vice chairman by reason of death, resignation, 
removal from office as a commissioner, or expiration of his 
term of office as a commissioner, the President shall designate 
as the chairman or vice chairman, as the case may be, for the 
remainder of such term a commissioner who is a member of the 
same political party. Designation of a chairman under this 
subparagraph may be made without regard to the 1-year 
continuous service requirement under subparagraph (A).
    (4) The vice chairman shall act as chairman in case of the 
absence or disability of the chairman. During any period in 
which there is no chairman or vice chairman, the commissioner 
having the longest period of continuous service as a 
commissioner shall act as chairman.
    (5) No commissioner shall actively engage in any business, 
vocation, or employment other than that of serving as a 
commissioner.
    (6) A majority of the commissioners in office shall 
constitute a quorum, but the Commission may function 
notwithstanding vacancies.
    (d) Effect of Divided Vote in Certain Cases.--
          (1) In a proceeding in which the Commission is 
        required to determine--
                  (A) under section 202 of the Trade Act of 
                1974, whether in-creased imports of an article 
                are a substantial cause of serious injury, or 
                the threat thereof, as described in subsection 
                (b)(1) of that section (hereafter in this 
                subsection referred to as ``serious injury''), 
                or
                  (B) under section 406 of such Act, whether 
                market disruption exists,
        and the commissioners voting are equally divided with 
        respect to such determination, then the determination 
        agreed upon by either group of commissioners may be 
        considered by the President as the determination of the 
        Commission.
          (2) If under section 202(b) or 406 of the Trade Act 
        of 1974 there is an affirmative determination of the 
        Commission, or a determination of the Commission which 
        the President may consider an affirmative determination 
        under paragraph (1), that serious injury or market 
        disruption exists, respectively, and a majority of the 
        commissioners voting are unable to agree on a finding 
        or recommendation described in section 202(e)(1) of 
        such Act or the finding described in section 406(a)(3) 
        of such Act, as the case may be (hereafter in this 
        subsection referred to as a ``remedy finding''), then--
                  (A) if a plurality of not less than three 
                commissioners so voting agree on a remedy 
                finding, such remedy finding shall, for 
                purposes of section 203 of such Act, be treated 
                as the remedy finding of the Commission, or
                  (B) if two groups, both of which include not 
                less than 3 commissioners, each agree upon a 
                remedy finding and the President reports under 
                section 204(a) of such Act that--
                          (i) he is taking the action agreed 
                        upon by one such group, then the remedy 
                        finding agreed upon by the other group 
                        shall, for purposes of section 203 of 
                        such Act, be treated as the remedy 
                        finding of the Commission, or
                          (ii) he is taking action which 
                        differs from the action agreed upon by 
                        both such groups, or that he will not 
                        take any action, then the remedy 
                        finding agreed upon by either such 
                        group may be considered by the Congress 
                        as the remedy finding of the Commission 
                        and shall, for purposes of section 203 
                        of such Act, be treated as the remedy 
                        finding of the Commission.
          (3) In any proceeding to which paragraph (1) applies 
        in which the commissioners voting are equally divided 
        on a determination that serious injury exists, or that 
        market disruption exists, the Commission shall report 
        to the President the determination of each group of 
        commissioners. In any proceeding to which paragraph (2) 
        applies, the Commission shall report to the President 
        the remedy finding of each group of commissioners 
        voting.
          (4) In a case to which paragraph (2)(B)(ii) applies, 
        for purposes of section 203(a) of the Trade Act of 
        1974, notwithstanding section 152(a)(1)(A) of such Act, 
        the second blank space in the concurrent resolution 
        described in such section 152 shall be filled with the 
        appropriate date and the following: ``The action which 
        shall take effect under section 203(c)(1) of the Trade 
        Act of 1974 is the finding or recommendation agreed 
        upon by Commissioners ------------, ------------, and 
        ------------.'' The three blank spaces shall be filled 
        with the names of the appropriate Commissioners.
          (5) Whenever, in any case in which the Commission is 
        authorized to make an investigation upon its own 
        motion, upon complaint, or upon application of any 
        interested party, one-half of the number of 
        commissioners voting agree that the investigation 
        should be made, such investigation shall thereupon be 
        carried out in accordance with the statutory authority 
        covering the matter in question. Whenever the 
        Commission is authorized to hold hearings in the course 
        of any investigation and one-half of the number of 
        commissioners voting agree that hearings should be held 
        such hearings shall thereupon be held in accordance 
        with the statutory authority covering the matter in 
        question.
    (e) Authorization of Appropriations.--(1) For the fiscal 
year beginning October 1, 1976, and each fiscal year 
thereafter, there are authorized to be appropriated to the 
Commission only such sums as may hereafter be provided by law.
    (2)(A) There are authorized to be appropriated to the 
Commission for necessary expenses (including the rental of 
conference rooms in the District of Columbia and elsewhere) not 
to exceed the following:
          (i) $41,170,000 for fiscal year 1991.
          (ii) $44,052,000 for fiscal year 1992.
    (B) Not to exceed $2,500 of the amount authorized to be 
appropriated for any fiscal year under subparagraph (A) may be 
used, subject to the approval of the Chairman of the 
Commission, for reception and entertainment expenses.
    (C) No part of any sum that is appropriated under the 
authority of subparagraph (A) may be used by the Commission in 
the making of any special study, investigation, or report that 
is requested by any agency of the executive branch unless that 
agency reimburses the Commission for the cost thereof.
    (3) There are authorized to be appropriated to the 
Commission for each fiscal year after September 30, 1977, in 
addition to any other amount authorized to be appropriated for 
such fiscal year, such sums as may be necessary for increases 
authorized by law in salary, pay, retirement, and other 
employee benefits.
    (f) The Commission shall be considered to be an independent 
regulatory agency for purposes of chapter 35 of title 44, 
United States Code.

SEC. 331. GENERAL POWERS.

    (a) Administration.--(1) Except as provided in paragraph 
(2), the chairman of the Commission, shall--
          (A) appoint and fix the compensation of such 
        employees of the Commission as he deems necessary 
        (other than the personal staff of each commissioner), 
        including the secretary,
          (B) procure the services of experts and consultants 
        in accordance with the provisions of section 3109 of 
        Title 5, and
          (C) exercise and be responsible for all other 
        administrative functions of the Commission.
Any decision by the chairman under this paragraph shall be 
subject to disapproval by a majority vote of all the 
commissioners in office.
    (2) Subject to approval by a majority vote of all the 
commissioners in office, the chairman may--
          (A) terminate the employment of any supervisory 
        employee of the Commission whose duties involve 
        substantial personal responsibility for Commission 
        matters and who is compensated at a rate equal to, or 
        in excess of, the rate for grade GS-15 of the General 
        Schedule in section 5332 of title 5, and
          (B) formulate the annual budget of the Commission.
    (3) No member of the Commission, in making public 
statements with respect to any policy matter for which the 
Commission has responsibility, shall represent himself as 
speaking for the Commission, or his views as being the views of 
the Commission, with respect to such matters except to the 
extent that the Commission has adopted the policy being 
expressed.
    (b) Application of Civil Service Law.--Except for employees 
excepted under civil service rules, all employees of the 
Commission shall be appointed from lists of eligibles to be 
supplied by the Director of the Office of Personnel Management 
and in accordance with the civil service law.
    (c) Expenses.--All of the expenses of the Commission, 
including all necessary expenses for transportation incurred by 
the commissioners or by their employees under their orders in 
making any investigation or upon official business in any other 
places than at their respective headquarters, shall be allowed 
and paid on the presentation of itemized vouchers therefor 
approved by the chairman (except that in the case of a 
commissioner, or the personal staff of any commissioner, such 
vouchers may be approved by that commissioner).
    (d) Principal Office at Washington.--The principal office 
of the Commission shall be in the city of Washington, but it 
may meet and exercise all its powers at any other place. The 
Commission may, by one or more of its members, or by such 
agents as it may designate, prosecute any inquiry necessary to 
its duties in any part of the United States or in any foreign 
country.
    (e) Office at New York.--The Commission is authorized to 
establish and maintain an office at the port of New York for 
the purpose of directing or carrying on any investigation, 
receiving and compiling statistics, selecting, describing, and 
filing samples of articles, and performing any of the duties or 
exercising any of the powers imposed upon it by law.
    (f) Official Seal.--The Commission is authorized to adopt 
an official seal, which shall be judicially noticed.

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SEC. 333. TESTIMONY AND PRODUCTION OF PAPERS.

    (a) Authority To Obtain Information.--For the purposes of 
carrying out its functions and duties in connection with any 
investigation authorized by law, the Commission or its duly 
authorized agent or agents (1) shall have access to and the 
right to copy any document, paper, or record, pertinent to the 
subject matter under investigation, in the possession of any 
person, firm, copartnership, corporation, or association 
engaged in the production, importation, or distribution of any 
article under investigation, (2) may summon witnesses, take 
testimony, and administer oaths, (3) may require any person, 
firm, copartnership, corporation, or association to produce 
books or papers relating to any matter pertaining to such 
investigation, and (4) may require any person, firm, 
copartnership, corporation, or association, to furnish in 
writing, in such detail and in such form as the Commission may 
prescribe, information in their possession pertaining to such 
investigation. Any member of the Commission may sign subpoenas, 
and members and agents of the Commission, when authorized by 
the Commission, may administer oath and affirmations, examine 
witnesses, take testimony, and receive evidence.
    (b) Witnesses and Evidence.--Such attendance of witnesses 
and the production of such documentary evidence may be required 
from any place in the United States at any designated place of 
hearing. And in case of disobedience to a subpoena the 
Commission may invoke the aid of any district or territorial 
court of the United States in requiring the attendance and 
testimony of witnesses and the production of documentary 
evidence, and such court within the jurisdiction of which such 
inquiry is carried on may, in case of contumacy or refusal to 
obey a subpoena issued to any corporation or other person, 
issue an order requiring such corporation or other person to 
appear before the Commission, or to produce documentary 
evidence if so ordered or to give evidence touching the matter 
in question; and any failure to obey such order of the court 
may be punished by such court as a contempt thereof.
    (c) Mandamus.--At the request of the Commission, any such 
court shall have jurisdiction to issue writs of mandamus 
commanding compliance with the provisions of this part or any 
order of the Commission made in pursuance thereof.
    (d) Depositions.--The Commission may order testimony to be 
taken by deposition in any proceeding or investigation pending 
before the Commission at any stage of such proceeding or 
investigation. Such depositions may be taken before any person 
designated by the Commission and having power to administer 
oaths. Such testimony shall be reduced to writing by the person 
taking the deposition, or under his direction, and shall then 
be subscribed by the deponent. Any person, firm, copartnership, 
corporation, or association, may be compelled to appear and 
depose and to produce documentary evidence in the same manner 
as witnesses may be compelled to appear and testify and produce 
documentary evidence before the Commission, as hereinbefore 
provided.
    (e) Fees and Mileage of Witnesses.--Witnesses summoned 
before the Commission shall be paid the same fees and mileage 
that are paid witnesses in the courts of the United States, and 
witnesses whose depositions are taken and the person taking the 
same, except employees of the Commission, shall severally be 
entitled to the same fees and mileage as are paid for like 
services in the court of the United States.
    (f) Statements Under Oath.--The Commission is authorized, 
in order to ascertain any facts required by subdivision (d) of 
section 332 to require any importer and any American grower, 
producer, manufacturer, or seller to file with the commission a 
statement, under oath, giving his selling prices in the United 
States of any article imported, grown, produced, fabricated, 
manipulated, or manufactured by him.
    (g) Representation in Court Proceedings.--The Commission 
shall be represented in all judicial proceedings by attorneys 
who are employees of the Commission or, at the request of the 
Commission, by the Attorney General of the United States.
    (h) Administrative Protective Orders.--Any correspondence, 
private letters of reprimand, and other documents and files 
relating to violations or possible violations of administrative 
protective orders issued by the Commission in connection with 
investigations or other proceedings under this title shall be 
treated as information described in section 552(b)(3) of title 
5, United States Code.

SEC. 334. COOPERATION WITH OTHER AGENCIES.

    The Commission shall in appropriate matters act in 
conjunction and cooperation with the Treasury Department, the 
Department of Commerce, the Federal Trade Commission, or any 
other departments, or independent establishments of the 
Government, and such departments and independent establishments 
of the Government shall cooperate fully with the Commission for 
the purposes of aiding and assisting in its work, and when 
directed by the President, shall furnish to the Commission, on 
its request, all records, papers, and information in their 
possession relating to any of the subjects of investigation by 
the Commission and shall detail, from time to time, such 
officials and employees to said Commission as he may direct.

SEC. 335. RULES AND REGULATIONS.

    The Commission is authorized to adopt such reasonable 
procedures and rules and regulations as it deems necessary to 
carry out its functions and duties.

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SEC. 339. TRADE REMEDY ASSISTANCE OFFICE.

    (a) There is established in the Commission a separate 
office to be known as the Trade Remedy Assistance Office which 
shall provide full information to the public upon request and 
shall to the extent feasible, provide assistance and advice to 
interested parties concerning--
          (1) remedies and benefits available under the trade 
        laws, and
          (2) the petition and application procedures, and the 
        appropriate filing dates, with respect to such remedies 
        and benefits.
    (b) The Trade Remedy Assistance Office, in coordination 
with each agency responsible for administering a trade law, 
shall provide technical and legal assistance and advice to 
eligible small businesses to enable them--
          (1) to prepare and file petitions and applications 
        (other than those which, in the opinion of the Office, 
        are frivolous); and
          (2) to seek to obtain the remedies and benefits 
        available under the trade laws, including any 
        administrative review or administrative appeal 
        thereunder.
    (c) For purposes of this section--
          (1) The term ``eligible small business'' means any 
        business concern which, in the agency's judgment, due 
        to its small size, has neither adequate internal 
        resources nor financial ability to obtain qualified 
        outside assistance in preparing and filing petitions 
        and applications for remedies and benefits under trade 
        laws. In determining whether a business concern is an 
        ``eligible small business'', the agency may consult 
        with the Small Business Administration, and shall 
        consult with any other agency that has provided 
        assistance under subsection (b) to that business 
        concern. Any agency decision regarding whether a 
        business concern is an eligible small business for 
        purposes of this section is not reviewable by any other 
        agency or by any court.
          (2) The term ``trade laws'' means--
                  (A) chapter 1 of title II of the Trade Act of 
                1974 (19 U.S.C. 2251 et seq., relating to 
                relief caused by import competition);
                  (B) chapters 2 and 3 of such title II 
                (relating to adjustment assistance for workers 
                and firms);
                  (C) chapter 1 of title III of the Trade Act 
                of 1974 (19 U.S.C. 2411 et seq., relating to 
                relief from foreign import restrictions and 
                export subsidies);
                  (D) title VII of the Tariff Act of 1930 (19 
                U.S.C. 1671 et seq., relating to the imposition 
                of countervailing duties and antidumping 
                duties);
                  (E) section 232 of the Trade Expansion Act of 
                1962 (19 U.S.C. 1862, relating to the 
                safeguarding of national security); and
                  (F) section 337 of the Tariff Act of 1930 (19 
                U.S.C. 1337, relating to unfair practices in 
                import trade).

                  Section 603 of the Trade Act of 1974


                     [19 U.S.C. 2482; P.L. 93-618]

SEC. 603. INTERNATIONAL TRADE COMMISSION.

    (a) In order to expedite the performance of its functions 
under this Act, the International Trade Commission may conduct 
preliminary investigations, determine the scope and manner of 
its proceedings, and consolidate proceedings before it.
    (b) In performing its functions under this Act, the 
Commission may exercise any authority granted to it under any 
other Act.
    (c) The Commission shall at all times keep informed 
concerning the operation and effect of provisions relating to 
duties or other import restrictions of the United States 
contained in trade agreements entered into under the trade 
agreements program.

               Section 175(a)(1) of the Trade Act of 1974


                     [19 U.S.C. 2232; P.L. 93-618]

SEC. 175. INDEPENDENT BUDGET AND AUTHORIZATION OF APPROPRIATIONS.

    (a)(1) Effective with respect to the fiscal year beginning 
October 1, 1976, for purposes of the Budget and Accounting Act, 
1921 (31 U.S.C. 1 et seq.), estimated expenditures and proposed 
appropriations for the United States International Trade 
Commission shall be transmitted to the President on or before 
October 15 of the year preceding the beginning of each fiscal 
year and shall be included by him in the Budget without 
revision, and the Commission shall not be considered to be a 
department or establishment for purposes of such Act.

                           2. Investigations


           Section 332 of the Tariff Act of 1930, as amended


 [19 U.S.C. 1332; P.L. 71-361, as amended by P.L. 93-618, P.L. 96-39, 
                    P.L. 100-418, and P.L. 100-647]

SEC. 332. INVESTIGATIONS.

    (a) Investigations and Reports.--It shall be the duty of 
the Commission to investigate the administration and fiscal and 
industrial effects of the customs laws of this country, the 
relations between the rates of duty on raw materials and 
finished or partly finished products, the effects of ad valorem 
and specific duties and of compound specific and ad valorem 
duties, all questions relative to the arrangement of schedules 
and classification of articles in the several schedules of the 
customs law, and, in general, to investigate the operation of 
customs laws, including their relation to the Federal revenues, 
their effect upon the industries and labor of the country, and 
to submit reports of its investigations as hereafter provided.
    (b) Investigations of Tariff Relations.--The Commission 
shall have power to investigate the tariff relations between 
the United States and foreign countries, commercial treaties, 
preferential provisions, economic alliances, the effect of 
export bounties and preferential transportation rates, the 
volume of importations compared with domestic production and 
consumption, and conditions, causes, and effects relating to 
competition of foreign industries with those of the United 
States, including dumping and cost of production.
    (c) Investigation of Paris Economy Pact.--The Commission 
shall have power to investigate the Paris Economy Pact and 
similar organizations and arrangements in Europe.
    (d) Information for President and Congress.--In order that 
the President and the Congress may secure information and 
assistance, it shall be the duty of the Commission to--
          (1) Ascertain conversion costs and costs of 
        production in the principal growing, producing, or 
        manufacturing centers of the United States of articles 
        of the United States, whenever in the opinion of the 
        Commission it is practicable;
          (2) Ascertain conversion costs and costs of 
        production in the principal growing, producing, or 
        manufacturing centers of foreign countries of articles 
        imported into the United States, whenever in the 
        opinion of the Commission such conversion costs or 
        costs of production are necessary for comparison with 
        conversion costs or costs of production in the United 
        States and can be reasonably ascertained;
          (3) Select and describe articles which are 
        representative of the classes or kinds of articles 
        imported into the United States and which are similar 
        to or comparable with articles of the United States; 
        select and describe articles of the United States 
        similar to or comparable with such imported articles; 
        and obtain and file samples of articles so selected, 
        whenever the Commission deems it advisable;
          (4) Ascertain imports costs of such representative 
        articles so selected;
          (5) Ascertain the grower's producer's, or 
        manufacturer's selling prices in the principal growing, 
        producing, or manufacturing centers of the United 
        States of the articles of the United States so 
        selected; and
          (6) Ascertain all other facts which will show the 
        differences in or which affect competition between 
        articles of the United States and imported articles in 
        the principal markets of the United States.
    (e) Definitions.--When used in this subdivision and in 
subdivision (d)--
          (1) The term ``article'' includes any commodity, 
        whether grown, produced, fabricated, manipulated, or 
        manufactured;
          (2) The term ``import cost'' means the transaction 
        value of the imported merchandise determined in 
        accordance with section 402(b) plus, when not included 
        in the transaction value, all necessary expenses, 
        exclusive of customs duties, of bringing such 
        merchandise to the United States.
    [(f) Provision directing the Commission to ascertain the 
cost of crude petroleum during 3 years preceding 1930.]
    (g) Reports to President and Congress.--The Commission 
shall put at the disposal of the President of the United 
States, the Committee on Ways and Means of the House of 
Representatives, and the Committee on Finance of the Senate, 
whenever requested, all information at its command, and shall 
make such investigations and reports as may be requested by the 
President or by either of said committees or by either branch 
of the Congress. However, the Commission may not release 
information which the Commission considers to be confidential 
business information unless the party submitting the 
confidential business information had notice, at the time of 
submission, that such information would be released by the 
Commission, or such party subsequently consents to the release 
of the information. The Commission shall report to Congress on 
the first Monday of December of each year after June 17, 1930, 
a statement of the methods adopted and all expenses incurred, a 
summary of all reports made during the year, and a list of all 
votes taken by the Commission during the year, showing those 
commissioners voting in the affirmative and the negative on 
each vote and those commissioners not voting on each vote and 
the reasons for not voting. Each such annual report shall 
include a list of all complaints filed under section 337 during 
the year for which such report is being made, the date on which 
each such complaint was filed, and the action taken thereon, 
and the status of all investigations conducted by the 
Commission under such section during such year and the date on 
which each such investigation was commenced.

            D. PRIVATE OR PUBLIC SECTOR ADVISORY COMMITTEES


            Section 135 of the Trade Act of 1974, as amended


 [19 U.S.C. 2155; P.L. 93-618, as amended by P.L. 96-39, P.L. 98-573, 
              P.L. 99-514, P.L. 100-418, and P.L. 103-465]

SEC. 135. INFORMATION AND ADVICE FROM PRIVATE AND PUBLIC SECTORS.

    (a) In General.--
          (1) The President shall seek information and advice 
        from representative elements of the private sector and 
        the non-Federal governmental sector with respect to--
                  (A) negotiating objectives and bargaining 
                positions before entering into a trade 
                agreement under this title or section 1102 of 
                the Omnibus Trade and Competitiveness Act of 
                1988;
                  (B) the operation of any trade agreement once 
                entered into, including preparation for dispute 
                settlement panel proceedings to which the 
                United States is a party; and
                  (C) other matters arising in connection with 
                the development, implementation, and 
                administration of the trade policy of the 
                United States, including those matters referred 
                to in Reorganization Plan Number 3 of 1979 and 
                Executive Order Numbered 12188, and the 
                priorities for actions thereunder.
        To the maximum extent feasible, such information and 
        advice on negotiating objectives shall be sought and 
        considered before the commencement of negotiations.
          (2) The President shall consult with representative 
        elements of the private sector and the non-Federal 
        governmental sector on the overall current trade policy 
        of the United States. The consultations shall include, 
        but are not limited to, the following elements of such 
        policy:
                  (A) The principal multilateral and bilateral 
                trade negotiating objectives and the progress 
                being made toward their achievement.
                  (B) The implementation, operation, and 
                effectiveness of recently concluded 
                multilateral and bilateral trade agreements and 
                resolution of trade disputes.
                  (C) The actions taken under the trade laws of 
                the United States and the effectiveness of such 
                actions in achieving trade policy objectives.
                  (D) Important developments in other areas of 
                trade for which there must be developed a 
                proper policy response.
          (3) The President shall take the advice received 
        through consultation under paragraph (2) into account 
        in determining the importance which should be placed on 
        each major objective and negotiating position that 
        should be adopted in order to achieve the overall trade 
        policy of the United States.
    (b) Advisory Committee for Trade Policy and Negotiations.--
          (1) The President shall establish an Advisory 
        Committee for Trade Policy and Negotiations to provide 
        overall policy advice on matters referred to in 
        subsection (a). The committee shall be composed of not 
        more than 45 individuals and shall include 
        representatives of non-Federal governments, labor, 
        industry, agriculture, small business, service 
        industries, retailers, nongovernmental environmental 
        and conservation organizations, and consumer interests. 
        The committee shall be broadly representative of the 
        key sectors and groups of the economy, particularly 
        with respect to those sectors and groups which are 
        affected by trade. Members of the committee shall be 
        recommended by the United States Trade Representative 
        and appointed by the President for a term of 2 years. 
        An individual may be reappointed to committee for any 
        number of terms. Appointments to the Committee shall be 
        made without regard to political affiliation.
          (2) The committee shall meet as needed at the call of 
        the United States Trade Representative or at the call 
        of two-thirds of the members of the committee. The 
        chairman of the committee shall be elected by the 
        committee from among its members.
          (3) The United States Trade Representative shall make 
        available to the committee such staff, information, 
        personnel, and administrative services and assistance 
        as it may reasonably require to carry out its 
        activities.
    (c) General Policy, Sectoral, or Functional Advisory 
Committees.--
          (1) The President may establish individual general 
        policy advisory committees for industry, labor, 
        agriculture, services, investment, defense, and other 
        interests, as appropriate, to provide general policy 
        advice on matters referred to in subsection (a). Such 
        committees shall, insofar as is practicable, be 
        representative of all industry, labor, agricultural, 
        service, investment, defense, and other interests, 
        respectively, including small business interests, and 
        shall be organized by the United States Trade 
        Representative and the Secretaries of Commerce, 
        Defense, Labor, Agriculture, the Treasury, or other 
        executive departments, as appropriate. The members of 
        such committees shall be appointed by the United States 
        Trade Representative in consultation with such 
        Secretaries.
          (2) The President shall establish such sectoral or 
        functional advisory committees as may be appropriate. 
        Such committees shall, insofar as is practicable, be 
        representative of all industry, labor, agricultural, or 
        service interests (including small business interests) 
        in the sector or functional areas concerned. In 
        organizing such committees, the United States Trade 
        Representative and the Secretaries of Commerce, Labor, 
        Agriculture, the Treasury, or other executive 
        departments, as appropriate, shall--
                  (A) consult with interested private 
                organizations; and
                  (B) take into account such factors as--
                          (i) patterns of actual and potential 
                        competition between United States 
                        industry and agriculture and foreign 
                        enterprise in international trade,
                          (ii) the character of the nontariff 
                        barriers and other distortions 
                        affecting such competition,
                          (iii) the necessity for reasonable 
                        limits on the number of such advisory 
                        committees,
                          (iv) the necessity that each 
                        committee be reasonably limited in 
                        size, and
                          (v) in the case of each sectoral 
                        committee, that the product lines 
                        covered by each committee be reasonably 
                        related.
          (3) The President--
                  (A) may, if necessary, establish policy 
                advisory committees representing non-Federal 
                governmental interests to provide policy 
                advice--
                          (i) on matters referred to in 
                        subsection (a), and
                          (ii) with respect to implementation 
                        of trade agreements, and
                  (B) shall include as members of committees 
                established under subparagraph (A) 
                representatives of non-Federal governmental 
                interests if he finds such inclusion 
                appropriate after consultation by the United 
                States Trade Representative with such 
                representatives.
          (4) Appointments to each committee established under 
        paragraph (1), (2), or (3) shall be made without regard 
        to political affiliation.
    (d) Policy, Technical, and Other Advice and Information.--
Committees established under subsection (c) shall meet at the 
call of the United States Trade Representative and the 
Secretaries of Agriculture, Commerce, Labor, Defense, or other 
executive departments, as appropriate, to provide policy 
advice, technical advice and information, and advice on other 
factors relevant to the matters referred to in subsection (a).
    (e) Meeting of Advisory Committees at Conclusion of 
Negotiations.--
          (1) The Advisory Committee for Trade Policy and 
        Negotiations, each appropriate policy advisory 
        committee, and each sectoral or functional advisory 
        committee, if the sector or area which such committee 
        represents is affected, shall meet at the conclusion of 
        negotiations for each trade agreement entered into 
        under section 1102 of the Omnibus Trade and 
        Competitiveness Act of 1988, to provide to the 
        President, to Congress, and to the United States Trade 
        Representative a report on such agreement. Each report 
        that applies to a trade agreement entered into under 
        section 1102 of the Omnibus Trade and Competitiveness 
        Act of 1988 shall be provided under the preceding 
        sentence not later than the date on which the President 
        notifies the Congress under section 1103(a)(1)(A) of 
        such Act of 1988 of his intention to enter into that 
        agreement.
          (2) The report of the Advisory Committee for Trade 
        Policy and Negotiations and each appropriate policy 
        advisory committee shall include an advisory opinion as 
        to whether and to what extent the agreement promotes 
        the economic interests of the United States and 
        achieves the applicable overall and principal 
        negotiating objectives set forth in section 1101 of the 
        Omnibus Trade and Competitiveness Act of 1988, as 
        appropriate.
          (3) The report of the appropriate sectoral or 
        functional committee under paragraph (1) shall include 
        an advisory opinion as to whether the agreement 
        provides for equity and reciprocity within the sector 
        or within the functional area.
    (f) Application of Federal Advisory Committee Act.--The 
provisions of the Federal Advisory Committee Act apply--
          (1) to the Advisory Committee for Trade Policy and 
        Negotiations established under subsection (b); and
          (2) to all other advisory committees which may be 
        established under subsection (c); except that the 
        meetings of advisory committees established under 
        subsections (b) and (c) shall be exempt from the 
        requirements of subsections (a) and (b) of sections 10 
        and 11 of the Federal Advisory Committee Act (relating 
        to open meetings, public notice, public participation, 
        and public availability of documents), whenever and to 
        the extent it is determined by the President or his 
        designee that such meetings will be concerned with 
        matters the disclosure of which would seriously 
        compromise the development by the United States 
        Government of trade policy, priorities, negotiating 
        objectives or bargaining positions with respect to 
        matters referred to in subsection (a), and that 
        meetings may be called of such special task forces, 
        plenary meetings of chairmen, or other such groups made 
        up of members of the committees established under 
        subsections (b) and (c).
    (g) Trade Secrets and Confidential Information.--
          (1) Trade secrets and commercial or financial 
        information which is privileged or confidential, and 
        which is submitted in confidence by the private sector 
        or non-Federal government to officers or employees of 
        the United States in connection with trade 
        negotiations, may be disclosed upon request to--
                  (A) officers and employees of the United 
                States designated by the United States Trade 
                Representative;
                  (B) members of the Committee on Ways and 
                Means of the House of Representatives and the 
                Committee on Finance of the Senate who are 
                designated as official advisers under section 
                161(a)(1) or are designated by the chairmen of 
                either such committee under section 
                161(b)(3)(A) and staff members of either such 
                committee designated by the chairmen under 
                section 161(b)(3)(A); and
                  (C) members of any committee of the House or 
                Senate or any joint committee of Congress who 
                are designated as advisers under section 
                161(a)(2) or designated by the chairman of such 
                committee under section 161(b)(3)(B) and staff 
                members of such committee designated under 
                section 161(b)(3)(B), but disclosure may be 
                made under this subparagraph only with respect 
                to trade secrets or commercial or financial 
                information that is relevant to trade policy 
                matters or negotiations that are within the 
                legislative jurisdiction of such committee;
        for use in connection with matters referred to in 
        subsection (a).
          (2) Information other than that described in 
        paragraph (1), and advice submitted in confidence by 
        the private sector or non-Federal government to 
        officers or employees of the United States, to the 
        Advisory Committee for Trade Policy and Negotiations, 
        or to any advisory committee established under 
        subsection (c), in connection with matters referred to 
        in subsection (a), may be disclosed upon request to--
                  (A) the individuals described in paragraph 
                (1); and
                  (B) the appropriate advisory committee 
                established under this section.
          (3) Information submitted in confidence by officers 
        or employees of the United States to the Advisory 
        Committee for Trade Policy and Negotiations, or to any 
        advisory committee established under subsection (c), 
        may be disclosed in accordance with rules issued by the 
        United States Trade Representative and the Secretaries 
        of Commerce, Labor, Defense, Agriculture, or other 
        executive departments, as appropriate, after 
        consultation with the relevant advisory committees 
        established under subsection (c). Such rules shall 
        define the categories of information which require 
        restricted or confidential handling by such committee 
        considering the extent to which public disclosure of 
        such information can reasonably be expected to 
        prejudice the development of trade policy, priorities, 
        or United States negotiating objectives. Such rules 
        shall, to the maximum extent feasible, permit 
        meaningful consultations by advisory committee members 
        with persons affected by matters referred to in 
        subsection (a).
    (h) Advisory Committee Support.--The United States Trade 
Representative, and the Secretaries of Commerce, Labor, 
Defense, Agriculture, the Treasury, or other executive 
departments, as appropriate, shall provide such staff, 
information, personnel, and administrative services and 
assistance to advisory committees established under subsection 
(c) as such committees may reasonably require to carry out 
their activities.
    (i) Consultation With Advisory Committees; Procedures; 
Nonacceptance of Committee Advice or Recommendations.--It shall 
be the responsibility of the United States Trade 
Representative, in conjunction with the Secretaries of 
Commerce, Labor, Agriculture, the Treasury, or other executive 
departments, as appropriate, to adopt procedures for 
consultation with and obtaining information and advice from the 
advisory committees established under subsection (c) on a 
continuing and timely basis. Such consultation shall include 
the provision of information to each advisory committee as to--
          (1) significant issues and developments; and
          (2) overall negotiating objectives and positions of 
        the United States and other parties;
with respect to matters referred to in subsection (a). The 
United States Trade Representative shall not be bound by the 
advice or recommendations of such advisory committees, but 
shall inform the advisory committees of significant departures 
from such advice or recommendations made. In addition, in the 
course of consultations with the Congress under this title, 
information on the advice and information provided by advisory 
committees shall be made available to congressional advisers.
    (j) Private Organizations or Groups.--In addition to any 
advisory committee established under this section, the 
President shall provide adequate, timely and continuing 
opportunity for the submission on an informal basis (and, if 
such information is submitted under the provisions of 
subsection (g), on a confidential basis) by private 
organizations or groups, representing government, labor, 
industry, agriculture, small business, service industries, 
consumer interests, and others, of statistics, data and other 
trade information, as well as policy recommendations, pertinent 
to any matter referred to in subsection (a).
    (k) Scope of Participation by Members of Advisory 
Committees.--Nothing contained in this section shall be 
construed to authorize or permit any individual to participate 
directly in any negotiation of any matters referred to in 
subsection (a). To the maximum extent practicable, the members 
of the committees established under subsections (b) and (c), 
and other appropriate parties, shall be informed and consulted 
before and during any such negotiations. They may be designated 
as advisors to a negotiating delegation, and may be permitted 
to participate in international meetings to the extent the head 
of the United States delegation deems appropriate. However, 
they may not speak or negotiate for the United States.
    (l) Advisory Committees Established by Department of 
Agriculture.--The provisions of title XVIII of the Food and 
Agriculture Act of 1977 (7 U.S.C. 2281 et seq.) shall not apply 
to any advisory committee established under subsection (c).
    (m) Non-Federal Government Defined.--As used in this 
section the term ``non-Federal government'' means--
          (1) any State, territory, or possession of the United 
        States, or the District of Columbia, or any political 
        subdivision thereof; or
          (2) any agency or instrumentality of any entity 
        described in paragraph (1).
                                APPENDIX

                              ----------                              


  DESCRIPTIONS OF MAJOR REGIONAL AND MULTILATERAL TRADE ORGANIZATIONS

                     World Trade Organization (WTO)

    The agreement establishing the WTO as of January 1, 1995, 
is a multilateral instrument which creates a permanent 
organization to oversee the implementation of the Uruguay Round 
Agreements, including the GATT 1994, to provide a forum for 
multilateral trade negotiations, and to administer dispute 
settlements. The WTO operates in a similar manner to the GATT, 
which it replaces, and is headquartered in Geneva, Switzerland. 
Additional Information on the WTO can be found at www.wto.org.

                 WTO Membership as of November 30, 2000

Albania
Angola
Antigua and
  Barbuda
Argentina
Australia
Austria
Bahrain
Bangladesh
Barbados
Belgium
Belize
Benin
Bolivia
Botswana
Brazil
Brunei
  Darussalam
Bulgaria
Burkina Faso
Burundi
Cameroon
Canada
Central African Republic
Chad
Chile
Colombia
Congo
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Democratic Republic of the Congo
Denmark
Djibouti
Dominica
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
European Community
Fiji
Finland
France
Gabon
Gambia
Georgia
Germany
Ghana
Greece
Grenada
Guatemala
Guinea Bissau
Guinea, Republic of
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Ireland
Israel
Italy
Jamaica
Jordan
Japan
Kenya
Korea
Kuwait
The Kyrgyz Republic
Latvia
Lesotho
Liechtenstein
Luxembourg
Macau
Madagascar
Malawi
Malaysia
Maldives
Mali
Malta
Mauritania
Mauritius
Mexico
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman, Sultanate of
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Rwanda
St. Kitts and Nevis
St. Lucia
St. Vincent and the
  Grenadines
Senegal
Sierra Leone
Singapore
Slovak Republic
Slovenia
Solomon Islands
South Africa
Spain
Sri Lanka
Suriname
Swaziland
Sweden
Switzerland
Tanzania
Thailand
Togo
Trinidad and Tobago
Tunisia
Turkey
Uganda
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Zambia
Zimbabwe

              Observer Governments as of November 30, 2000

Algeria
Andorra
Armenia
Azerbaijan
Bahamas
Belarus
Bhutan
Bosnia and herzegovina
Cambodia
Cape Verde
People's Republic of China
Ethiopia
Former Yugoslav Republic of Macedonia
Holy See (Vatican)
Lao People's Democratic Republic
Lebanon
Lithuania
Moldova
Nepal
Russian Federation
Samoa
Saudi Arabia
Seychelles
Sudan
Chinese Taipei
Tonga
Ukraine
Uzbekistan
Vanuatu
Vietnam
Yemen

      Organization for Economic Cooperation and Development (OECD)

    Founded in 1961 and based in Paris, the OECD is the primary 
organization for industralized nations to discuss trade and 
economic matters. The objectives are to achieve economic growth 
and employment and a rising standard of living in member 
countries while maintaining financial stability. The 30 member 
countries use the OECD and its various committees and working 
groups to conduct both studies and negotiations on particular 
economic problems and to coordinate their policies for purposes 
of international negotiations. Additional information on the 
OCECD can be found at www.oced.org.

                 OECD Membership as of February 1, 2001

Australia
Austria
Belgium
Canada
Czech Republic
Denmark
Finland
France
Germany
Greece
Hungary
Iceland
Ireland
Italy
Japan
Korea
Luxembourg
Mexico
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Spain
Sweden
Switzerland
Turkey
United Kingdom
United States

      United Nations Conference on Trade and Development (UNCTAD)

    Based in Geneva and associated with the United Nations 
system, UNCTAD focuses attention on international economic 
relations and measures that might be taken by developed 
countries to accelerate the pace of economic and industrial 
development in the developing countries. The conference has met 
quadrennially since 1964 in various locations throughout the 
world. UNCTAD committees meet several times each year between 
the major conferences and is supported by the permanent UNCTAD 
Secretariat in Geneva, Switzerland. Additional information on 
UNCTAD can be found at www.unctad.org.

                       World Customs Organization

    Established in 1952 as the Customs Cooperation Council, the 
renamed World Customs Organization is a 151-member 
international organization with headquarters in Brussels, 
Belgium. It deals exclusively with customs matters. Its 
objective is to obtain, in the interest of international trade, 
the best possible degree of uniformity among the customs 
systems of member nations. The United States became a member on 
November 5, 1970.
    The Customs Service is the lead government agency in 
dealing with the various activities of the Council, including 
the work of the Harmonized System Committee. The Customs 
Service heads the U.S. delegations to the sessions of the 
Committee. Generally, the Council studies questions relating to 
cooperation in customs matters, examines technical aspects of 
customs systems and furnishes information and advice to member 
states.

                          European Union (EU)

    The EU is a union of 15 independent nations and was founded 
to enhance political, economic and social cooperation. Formerly 
known as the European Community (EC) or the European Economic 
Community (EEC), the EU was founded in November 1993, upon 
ratification of the Maastricht Treaty. The Maastricht Treaty 
expanded the scope of the EEC and included provisions for an 
economic and monetary union with a single european currency to 
begin at the end of the century. Additional information on the 
EU can be found at www.eurunion.org.

                 EU Membership, as of February 1, 2001

Austria
Belgium
Denmark
Finland
France
Germany
Greece
Ireland
Italy
Luxembourg
Netherlands
Portugal
Spain
Sweden
United Kingdom of Great Britain and Northern Ireland

    In March 1998 the EU opened talks on full membership with 
six countries--Cyprus, the Czech Republic, Estonia, Hungary, 
Poland and Slovenia. Other countries interested in joining the 
EU are Bulgaria, Latvia, Lithuania, Romania, Slovakia, 
Switzerland and Turkey.

                Asia-Pacific Economic Cooperation (APEC)

    APEC was formed in 1989 in response to the growing 
interdependence among Asia-Pacific economies. Initiated as an 
informal dialogue group with limited participation, APEC has 
since become the primary regional vehicle for promoting open 
trade and practical economic cooperation. In 1994, APEC members 
agreed to attain free and open trade and investment among APEC 
industrialized nations by the year 2010 and among the 
developing members by 2020. APEC's 21-member economies possess 
a combined gross domestic product of over $18 trillion, nearly 
half the world's total annual output. Additional information on 
APEC can be found at www.apecsec.org.sg.

                APEC Membership, as of February 1, 2001

Australia
Brunei Darussalam
Canada
Chile
People's Republic of China
Hong Kong
Indonesia
Japan
Republic of Korea
Malaysia
Mexico
New Zealand
Papua New Guinea
Peru
Republic of the Philippines
Russia
Singapore
Chinese Taipei
Thailand
United States
Vietnam

                                MERCOSUR

    Mercosur, translated as the Southern Common Market, is 
composed of Brazil, Argentina, Paraguay, and Uruguay. Mercosur 
began operating a customs union on January 1, 1995, which binds 
tariff preferences among the four Mercosur countries and 
introduces a common external trade policy with non-member 
countries and economic groups.
     The purpose of Mercosur is to create a common market in 
which goods and services can be freely traded among member 
countries and to permit the unrestricted movement of labor and 
capital, the coordination of macroeconomic and sector policies, 
and the harmonization of national legislation in order to 
enhance competitiveness. Chile and Bolivia are associate 
members of Mercosur. Under the terms of their membership, they 
apply and receive preferential tariffs with respect to 
countries within Mercosur but do not apply the common external 
tariff. Additional information on MERCOSUR can be found at 
www.mercosur.com.

             Association of Southeast Asian Nations (ASEAN)

    ASEAN was established in August 1967 in Bangkok, Thailand, 
with the signing of the Bangkok Declaration by the five 
original member countries: Indonesia, Malaysia, Philippines, 
Singapore and Thailand. Brunei Darussalam joined the 
Association in January 1984, Vietnam in July 1995, Laos and 
Myanmar in July 1997, and Cambodia in April 1999.
    ASEAN was established with three main objectives: (1) to 
promote the economic, social and cultural development of the 
region through cooperative programs; (2) to safeguard the 
political and economic stability of the region against big 
power rivalry; and (3) to serve as a forum for the resolution 
of intra-regional differences. Additional information on ASEAN 
can be found at www.aseansec.org.

                              Cairns Group

    The Cairns Group is a 18-country group, chaired by 
Australia, which was established just before the Uruguay Round 
negotiations began. The purpose of the Cairns Group is to 
encourage reductions in trade-distorting farm subsidies and 
market access for agricultural products. Aside from Australia, 
other members are Argentina, Bolivia, Brazil, Canada, Chile, 
Colombia, Costa Rica, Fiji, Guatemala, Indonesia, Malaysia, New 
Zealand, Paraguay, Philippines, South Africa, Thailand, and 
Uruguay. These nations collectively account for one-third of 
the worlds' agricultural exports. Additional information on the 
Cairns Group can be found at www.cairnsgroup.org.
      

                             SUBJECT INDEX

                ALPHABETICAL LISTING BY POPULAR REFERENCE
 [First page number refers to description in part I; second page number
                    refers to text of law in part II]

                                                      Part I    Part II
                                                       page       page

African Elephant Conservation Act.................        170        758
African Growth and Opportunity Act................         37        367
Agriculture.......................................        159        727
Agriculture exports...............................        202        821
Agricultural Trade Act of 1978, as amended........        203        821
American Automobile Labeling Act..................         66        411
American goods returned...........................          7        289
Andean Initiative.................................         34        358
Antidumping Act of 1916...........................         90        618
Antidumping duties................................         83        501
Arms Export Control Act...........................        195        846
Atlantic Tunas Convention Act of 1975.............        171        771
Automotive Products Trade Act of 1965, as amended.         --       1107
Balance of payments authority.....................        176        777
Buy American Act..................................        184        790
Byrd amendment....................................        104        597
Canada............................................        265       1081
Caribbean Basin Initiative (CBI)..................         21        321
Caribbean Basin Trade Partnership Act.............         22        321
Carousel retaliation..............................        110        632
Chemical and Biological Weapons Control and                --        848
 Warfare Elimination Act of 1991..................
China.............................................        251        990
China safeguard...................................        140        682
Civil aircraft agreement..........................         12        468
Compensation authority............................        230        951
Congressional advisers............................        279       1119
Continued Dumping and Subsidy Offset Act..........        104        597
Copyrights and trademark enforcement..............         71        435
Countervailing Duties.............................         83        473
Country-of-origin marking.........................         63        403
Cuba embargo......................................        216        859
Cuban Liberty and Democratic Solidarity Act.......        218        867
Customs automation program........................         76        452
Customs commercial operations.....................         75        456
Customs modernization act.........................         76          1
Customs penalties.................................         72        440
Customs Service...................................      2 279          1
Customs user fees.................................         58        389
Customs valuation.................................         48        381
Department of Commerce............................        273         --
Dispute settlement................................        109        935
Drawback..........................................         67        415





                                                      Part I    Part II
                                                       page       page

Endangered Species Act of 1973, as amended........        169        753
Entry of merchandise..............................         48        424
Environmental laws................................        167        738
``Escape clause''.................................        132        662
Executive branch..................................        270       1137
Exemptions for food and medicine from U.S.                220   862, 875
 unilateral trade sanctions.......................
``Exon/Florio''...................................        223        910
Export Administration Act of 1979, as amended.....        196        811
Export Administration Amendments Act of 1985......        198        811
Export controls...................................        195        811
Export Enhancement Act of 1988, as amended........        200        827
Export promotion..................................        200        827
Fair Trade in Auto Parts of 1988..................        201         --
``Fast Track'' trade agreement implementing               232  no part 2
 procedures.......................................             reference
Foreign air transportation........................         --        646
Foreign Sales Corporation.........................        107         --
Foreign Shipping Practices Act of 1988............         --        651
Foreign trade barriers............................        241        959
Foreign trade zone................................         78        459
Foreign vessels...................................        222        907
General Agreement on Tariffs and Trade (GATT).....     passim       1165
Generalized System of Preferences (GSP)...........         14        307
Government procurment.............................        183        790
Harmonized Tariff Schedule of the United States             1        289
 (HTS)............................................
``Helms-Burton''..................................        218        867
High Seas Driftnet Fisheries Enforcement Act......        170        764
Hong Kong Policy Act..............................        222        900
Import license auctioning.........................        142        691
Import relief.....................................        132        662
Insular possessions...............................         10        304
Intellectual property rights......................        116        961
Interagency trade organization....................        270       1137
International Air Transportation Fair Competitive          --        646
 Practices Act of 1974, as amended................
International Dolphin Conservation Program........        168        747
International Emergency Economic Powers Act               205        833
 (IEEPA)..........................................
International Security and Development Cooperation        215        845
 Act of 1985......................................
International Trade Commission....................        275       1149
Iran and Libya Sanctions Act of 1996..............        215        884
Iraq sanctions....................................        220        875
Israel............................................        261       1075
Jackson-Vanik Amendment...........................        249        976
Jones Act.........................................        222        907
Marine Mammal Protection Act of 1972, as amended..        167        738
Market disruption relief..........................        139        680
Market order......................................        166        736
Meat inspection requirement.......................        164        732
Merchant Marine Act of 1920.......................        222        648
Mergers, acquisitions, and takeovers..............        223        910
Multifiber Arrangement (MFA)......................        153         --
Narcotics Control Trade Act.......................        214        839
National security import restrictions.............        174        774
National Trade Estimates report...................        241        959
Negotiating authority.............................        225        926
Negotiating objectives............................        226        913
Nonmarket economy countries.......................        249        976
Normal Trade Relations principle and treatment....     6, 246        974
North American Free Trade Agreement...............        260       1008
North American Free Trade Agreement Implementation        260       1134
 Act..............................................
``Pelly Amendment''...............................        170        762
Public Law 480....................................        202        822
Private or public sector advisory committees......        276       1159
Product standards.................................        178   786, 788
Reports to Congress...............................        270       1121
Rhinoceros and Tiger Conservation Act of 1994. as         170        761
 amended..........................................
Safeguards........................................        132        662
Sanctions.........................................   108, 153          3
Section 22 of the Agricultural Adjustment Act of          159        727
 1933, as amended.................................
Section 122 of the Trade Act of 1974..............        176        777
Section 123 of the Trade Act of 1974, as amended..        230        951
Section 125 of the Trade Act of 1974..............        230        952
Section 135 of the Trade Act of 1974, as amended..        276        919
Section 161 of the Trade Act of 1974, as amended..        269       1119
Section 181 of the Trade Act of 1974, as amended..        241        959
Section 201-204 of the Trade Act of 1974, as              132        662
 amended..........................................
Section 204 of the Trade Act of 1956, as amended..        153        727
Section 232 and 233 of the Trade Expansion Act of    174, 175        774
 1962, as amended.................................
Sections 301-310 of the Trade Act of 1974, as             108        621
 amended..........................................
Section 313 of the Tariff Act of 1930, as amended.         67        415
Section 332 of the Tariff Act of 1930, as amended.        276       1157
Section 337 of the Tariff Act of 1930, as amended.        128        654
Section 402 of the Tariff Act of 1930, as amended.         51        381
Section 406 of the Trade Act of 1974, as amended..        139        680
Section 501 of the United States-Canada Free Trade         --       1107
 Implementation Act of 1988.......................
Section 516A of the Tariff Act of 1930, as amended        105        600
Section 527 of the Tariff Act of 1930, as amended.        169        757
Section 592 of the Tariff Act of 1930, as amended.         72        440
Section 721 of the Defense Production Act of 1950,        223        910
 as amended.......................................
Sections 1101-1103, 1105(b), and 1107 of the              226        913
 Omnibus Trade and Competitiveness Act of 1988....
Section 13031 of the Consolidated Budget                   58        389
 Reconciliation Act of 1985, as amended...........
Shipping..........................................         --        651
``Shrimp-Turtle'' law.............................        172        773
``Special 301''...................................        116        621
Standards.........................................        178        780
Subsidies.........................................         83        473
Sugar tariff-rate quota head note authority.......        165        732
``Super 301''.....................................        123        621
Tariff modifications..............................        227        935
Technical barriers to trade.......................        179   786, 788
Telecommunications Trade Act of 1988..............        242        965
Termination and withdrawal authority..............        231        952
Terroism..........................................        215   845, 897
Textiles..........................................        153        727
Title II of the Trade Act of 1974, as amended.....        142        691
Title III of the Trade Agreements Act of 1979, as         188        790
 amended..........................................
Title IV of the Trade Act of 1974, as amended.....        246        982
Title IV of the Trade Act of 1979, as amended.....        182        780
Title V of the Trade Act of 1974, as amended......         14        307
Title VII of the Omnibus Trade and Competitiveness        189        790
 Act of 1988......................................
Title VII of the Tariff Act of 1930, as amended...         83        478
Trade Adjustment Assistance.......................        142        691
Trade agreement objectives, authorities, and              225        926
 requirements.....................................
Trade policy functions............................        269       1119
Trade Sanctions Reform and Export Enhancement Act         221        894
 of 20............................................
Trading with the Enemy Act, as amended............        211        837
United Nations Conference on Trade and Development         --       1166
United States-Canada Free Trade Agreement.........        266       1081
United States-Canada Free Trade Agreement                 267       1081
 Implementation Act...............................
United States International Trade Commission......        275       1149
United States-Israel Free Trade Area Agreement....        263       1072
United States-Israel Free Trade Implementation Act        264       1075
 of 1985..........................................
Uruguay Round Agreements..........................        235        935
Uruguay Round Agreements Act......................        237        935
U.S. Trade Representative (USTR)..................        271       1137
Wild Bird Conservation Act........................        171        769
World Customs Organization........................         --       1167
World Trade Organization..........................     passim       1165
World Trade Organization authorization............        236        935

\1\ Chapter 8, passim.
\2\ Chapter 1, passim.
\3\ Chapter 9, 12, passim.

                                   
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