[Congressional Record Volume 142, Number 87 (Thursday, June 13, 1996)]
[House]
[Pages H6293-H6325]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    SHIPBUILDING TRADE AGREEMENT ACT

  The SPEAKER pro tempore. Pursuant to House Resolution 448 and rule 
XXIII, the Chair declares the House in the Committee of the Whole House 
on

[[Page H6294]]

the State of the Union for the consideration of the bill, H.R. 2754.

                              {time}  1041


                     in the committee of the whole

  Accordingly the House resolved itself into the Committee of the Whole 
House on the State of the Union for the consideration of the bill (H.R. 
2754) to approve and implement the OECD Shipbuilding Trade Agreement, 
with Mr. Gutknecht in the chair.
  The Clerk read the title of the bill.
  The CHAIRMAN. Pursuant to the rule, the bill is considered as having 
been read the first time.
  The gentleman from Texas [Mr. Archer], the gentleman from Florida 
[Mr. Gibbons], the gentleman from South Carolina [Mr. Spence], and the 
gentleman from California [Mr. Dellums] will each be recognized for 15 
minutes.
  The Chair understands the Committee on Ways and Means will use all 
its time first.
  The Chair recognizes the gentleman from Texas [Mr. Archer].
  Mr. ARCHER. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I must take a moment to commend our colleague, the 
gentleman from Florida. Sam Gibbons, for his hard work, leadership, and 
expertise, not only on this bill but on all of the trade bills that we 
have worked on together for so many years. Sam, you have been a rock, a 
solid free trader, and over these years, you have been a real leader in 
forcing open markets, reducing trade barriers, and thereby creating 
greater opportunity for all working Americans in the next century. That 
is what this is all about: economic improvement and opportunity for all 
American workers.
  I realize that this may be the last time that we will be here on the 
floor together working to achieve freer trade and opportunity for 
working Americans. I, for one, am going to miss your leadership, your 
vision, and your expertise, your experience, your unsurpassed knowledge 
in these trade issues.
  Mr. Chairman, I strongly support H.R. 2754 to implement the OECD 
agreement on shipbuilding negotiated by the administration. It has 
taken us over 6 years from the beginning of the negotiations to get to 
this point. We are presented with a unique opportunity to allow U.S. 
shipyards to compete in a global market without losing out to companies 
from countries that are only too willing to provide billions of dollars 
in subsidies.
  This is a good agreement that accommodates the priorities of a broad 
bipartisan cross-section of the House. It adds a new trade remedy to 
our arsenal for U.S. shipbuilders that are injured by unfair pricing of 
ships around the world. It preserves our national security interest, 
and it preserves the Jones Act.

                              {time}  1045

  We may continue our Title XI: Loan Guarantee Program, although under 
the international standards set forth in the agreement. Our trading 
partners have to give up far more than we do. In fact, our trading 
partners, many of them have already approved this agreement and others 
are in the process of approving it and looking to us and what we are 
going to do today.
  There is strong bipartisan support for the agreement. The Committee 
on Ways and Means, which has primary jurisdiction, approved it by a 
vote of 27-4. The administration is strongly in support, as well, 
because it accurately reflects the negotiated agreement.
  I am opposed to the one amendment that will be offered to this bill 
because it is clearly inconsistent with the agreement. In extending the 
time period in which we can offer title XI loan guarantees that exceed 
the terms of the agreement, the amendment would put us in direct 
violation of the international standards set forth in the agreement.
  This amendment is being presented as a compromise because it would 
keep the current title XI program in effect for only 30 months, yet 
would not go so far as to maintain the current program indefinitely. 
But whatever the justification, it represents a clear and unmistakable 
violation of the agreement. In fact, our trading partners, in a matter 
of hours after the ink was dry on this amendment, wrote to tell us in 
no uncertain terms that they view the amendment as violating the 
agreement.

  In implementing this agreement we are hamstrung by the fact that we 
do not have fast track procedures in place that limit amendments once 
the legislation has been formally introduced. Nevertheless, we must 
show our trading partners that we have the ability to implement 
agreements that are negotiated by representatives of this country.
  If we fail to implement the agreement, or if we adopt the amendment 
which is inconsistent with the agreement, we lose twice. First, we will 
have lost the considerable opportunity to enable U.S. shipbuilders to 
reenter the worldwide commercial market and to compete on a level 
playing field. Second, such an outcome will reflect poorly upon the 
credibility of the United States.
  Ours was the country that initiated the negotiations on behalf of its 
industry in the first place and was the driving force during the 5-year 
negotiating process. We must not lose our reputation as a country that 
is able to implement the agreements that it negotiates and signs. The 
negotiations must end at the negotiating table and any congressional 
concern should be taken up at that point. We cannot redo our agreements 
in the implementation process.
  Accordingly, I believe that it is important to the future of our 
trade goals that we want to accomplish that we implement the agreement 
cleanly and quickly, without amendment. If Members vote for H.R. 2754 
and against the amendment, they can be assured they are voting for 
faithful implementation of the agreement that the administration 
negotiated.
  Mr. Chairman, I yield the balance of my time for distribution to the 
gentleman from Illinois [Mr. Crane].
  The CHAIRMAN. Without objection, the Chair will recognize the 
gentleman from Illinois to control the balance of the time.
  There was no objection.
  Mr. GIBBONS. Mr. Chairman, I yield myself 3 minutes.
  First let me thank the gentleman from Texas [Mr. Archer] for his 
generous comments about my service.
  Let me say that the debate here today goes far past this agreement. 
One of the reasons we have such a difficult time in international 
agreements is because the rest of the world says to America, ``As soon 
as we agree with you on something, you will unravel it in the 
ratification process.'' Let me make it clear that on this agreement, 
every other nation that is involved has already ratified this agreement 
and we face a deadline of tomorrow on ratifying this agreement.
  I want to talk about the Bateman amendment, with no animosity to the 
gentleman from Virginia [Mr. Bateman] or any of the supporters of his 
amendment. But the Bateman amendment, if adopted, will kill this 
agreement. The evidence is in yesterday's Record if my colleagues want 
to read it, all of the signatories of this agreement that said they 
will back out if we ratify the Bateman amendment, and tomorrow is the 
deadline.
  So this is a crucial historic point for this Congress. Can we enter 
into an international agreement without unraveling it here on the 
floor?
  The Bateman amendment itself, it adopted, will be ineffective. The 
Bateman amendment itself hangs on the slim gossamer thread of a 
standstill arrangement that is in the basic agreement and tomorrow is 
the deadline on the basic agreement. So if we signify today that we are 
not going ahead with this agreement as negotiated, the Bateman 
amendment stands no chance of having any influence upon shipbuilding in 
America.
  The standstill agreement is something that is common to every 
international agreement. That is, when we sign those agreements, all 
nations agree to not escalate the practice that we are outlawing.
  At best the Bateman amendment will be ineffective. At worst it will 
kill the agreement. We must vote down the Bateman amendment.
  The people that the gentleman from Virginia [Mr. Bateman] represents 
have had some 7 years to adjust to the changes that are coming about. 
The position he attempts to ratify and move forward is only short-term. 
On its face it looks reasonable, but there is more at stake than just 
the reasonableness of the Bateman amendment here. It is

[[Page H6295]]

the credibility of America in negotiating an international agreement. 
We cannot negotiate then with anyone. People will refuse to negotiate 
any agreements with us if we are going to unravel them here on the 
floor. That is the issue that is before us today.
  Please vote ``no'' on the Bateman amendment and support this 
agreement when it comes up for final ratification.
  Mr. Chairman, I rise in strong support of H.R. 2754, the OECD 
Shipbuilding Trade Agreement Act. This legislation would implement 
under U.S. law an international agreement reached after 5 long years of 
negotiations carried out by both the Bush and Clinton administrations. 
The agreement would eliminate the destructive pattern of heavy 
Government subsidies and chronic predatory pricing that has long 
characterized the global commercial shipbuilding industry.
  H.R. 2754 was favorably reported by the Ways and Means Committee on 
March 21 by a bipartisan vote of 27 to 4. It was also favorably 
reported as an amendment in the nature of a substitute by the National 
Security Committee by voice vote on May 29. Unfortunately, several key 
provisions of the National Security Committee's version of the 
legislation are inconsistent with the agreement. These provisions will 
be offered as a National Security Committee amendment by Mr. Bateman. 
Make no mistake about it, the Bateman amendment, if enacted into law, 
will kill the agreement.
  The administration strongly supports this legislation as does the 
Shipbuilders Council of America. The Shipbuilders Council includes 17 
companies operating 44 shipyards in 13 States across the country. In 
addition to SCA members, a large coalition of leading shippers, ports, 
and U.S.-flag operating companies support the agreement, including the 
American Waterways Shipyard Conference, the American Association of 
Port Authorities, the American Institute of Merchant Shipping, and the 
Labor Management Maritime Committee.


     the oecd shipbuilding agreement on h.r. 2754--the key elements

  To give Members an idea of what is contained in the OECD Shipbuilding 
Agreement and H.R. 2754, I would like to briefly outline the key 
elements of the agreement and H.R. 2754, which implements that 
agreement.
  Generally speaking, the OECD agreement contains four major elements--
  First, the elimination of virtually all subsidies granted either 
directly to shipbuilders or indirectly through ship operators;
  Second, an injurious pricing code designed to prevent dumping in the 
commercial shipbuilding industry;
  Third, a comprehensive discipline on Government financing for exports 
and domestic ship sales designed to avoid trade-distortive financing; 
and
  Fourth, an effective and binding dispute settlement mechanism.
  H.R. 2754 would implement the OECD Shipbuilding Agreement under U.S. 
law. By enacting H.R. 2754 into law, Congress would approve the 
agreement and make the necessary statutory changes to conform U.S. law 
to the agreement.
  Title I would establish a new title VIII to the Tariff Act of 1930, 
as amended, in order to create an injurious-pricing mechanism 
applicable to commercial shipbuilding, analogous to current U.S. 
antidumping law.
  Title II would eliminate the current 50-percent repair duty for 
repairs made to U.S.-flag vessels repaired in a country party to the 
agreement. Title II would also amend certain provisions of the Merchant 
Marine Act of 1936 to bring U.S. law into conformity with the 
agreement. In this regard, title II would amend the operational 
differential subsidies, capital construction fund, capital reserve 
fund, and cargo preference programs so that such programs would be 
available both to U.S.-built vessels as well as to vessels built in 
countries party to the agreement. Title II would also amend the title 
XI loan guarantee program to bring its terms into conformity with the 
agreement.
  Title III contains a revenue offset provision in the amount of $36 
million over 5 years by amending the penalty provisions for failure to 
file a disclosure of exemption for shipping income of foreign persons.


                         the bateman amendment

  The Bateman amendment contains those provisions of the National 
Security-reported bill not included as original text in the version of 
H.R. 2754 being considered by the House today. I strongly oppose the 
Bateman amendment because it will effectively kill the OECD agreement. 
I would like to focus on the two key provisions of the Bateman 
amendment that are inconsistent with the agreement.
  The first inconsistent provision would extend the current title XI 
loan guarantee program for an additional 30 months. The current title 
XI program, passed in 1994, provides Government guarantees to finance 
the purchase of a ship for up to 87.5 percent of the ship's value over 
25 years. The agreement, however, only allows financing for up to 80 
percent of the ship's value over 12 years. By passing H.R. 2754 without 
the Bateman amendment, the United States will continue to operate title 
XI financing on these terms.
  Unfortunately, if this provision of the Bateman amendment is enacted 
into law, it will scuttle the agreement. I have received letters from 
the chairman of the OECD negotiating group and high level officials 
from the EU, Japan, and Norway stating that continuation of the current 
title XI program is inconsistent with the agreement and therefore 
unacceptable. The administration also objects to this provision. We 
have had a temporary advantage with the current title XI program 
because every signatory to the agreement has been operating since the 
agreement was signed in December 1994 under a standstill, pending 
ratification of the agreement. If the agreement is not faithfully 
implemented, our trading partners will match, or better, our current 
title XI program and go back to providing other subsidies as well.
  The second inconsistent provision in the Bateman amendment would be 
contrary to the section of the agreement the United States negotiated 
to preserve the home build requirements of the Jones Act. Under the 
agreement, every country, except the United States, agreed to eliminate 
their home build requirements for ships operating in the coastwise 
trades. The United States took a full and permanent exception for the 
Jones Act, which means that the Jones Act will never be touched by the 
agreement. In exchange for protecting fully the Jones Act, however, the 
United States had to agree to a mechanism that would adjust downward, 
in certain circumstances, benefits that U.S. shipyards benefiting from 
the Jones Act would be entitled to under the agreement. Conceptually, 
the notion is that U.S. shipyards that receive increasing benefits 
because of exempted Jones Act contracts would be entitled to 
correspondingly fewer benefits under the provisions of the agreement in 
order to maintain an overall balance of advantages under the agreement. 
Given that potential Jones Act contracts are probably less than 1 
percent of total worldwide ship tonnage built every year, U.S. 
shipyards benefiting from the Jones Act would potentially have to give 
up 1 percent of the international market. This trade-off seemed 
reasonable in order to fully exempt the Jones Act from the agreement. 
Unfortunately, the Bateman amendment would unilaterally negate this 
section of the agreement.


                               conclusion

   Mr. Chairman, the OECD Shipbuilding Agreement took 5 long, hard 
years of negotiations. It is our best hope for creating a level playing 
field internationally for our commercial shipbuilders. Without this 
agreement, we will be back where we started some 15 years ago--with 
massive subsidies and unfair pricing practices by our trading partners. 
I strongly urge this House to oppose the Bateman amendment and to vote 
in favor of H.R. 2754. Nothing less will save this agreement.
   Mr. Chairman, I reserve the balance of my time.
  Mr. CRANE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I rise in support of H.R. 2754, the Shipbuilding Trade 
Agreement Act. This legislation would implement the OECD Agreement on 
Shipbuilding. H.R. 2754, and the agreement it implements, are the 
culmination of many years of effort to level the playing field 
worldwide for the shipbuilding industry. I sponsored H.R. 2754, along 
with my colleagues, Mr. Gibbons and Ms. Dunn, and Ways and Means 
favorably reported this legislation by an overwhelming bipartisan vote 
of 27 to 4. I strongly believe that this agreement will open up trade 
in shipbuilding for our industry by eliminating virtually all 
government subsidies and creating equitable terms of competition in the 
international shipbuilding market for U.S. shipbuilders. The agreement 
represents the best chance that our industry has to compete on a 
worldwide basis without having to contend with the huge subsidies 
offered by other governments to their shipbuilding industries.
  In addition, the agreement and implementing bill would provide a new 
remedy to U.S. shipyards that have been injured by unfair pricing. 
Unless this legislation is passed, our shipyards will not have access 
to this valuable remedy, which would force offending shipyards to pay a 
charge in the amount of injurious pricing or face significant trade 
restrictions.
  Of course, any international agreement must be fair and balanced, and 
I personally took care to assure that the agreement is truly 
symmetrical and that no special deals were cut to the detriment of the 
U.S. shipping industry. Any subsidies that are grandfathered under the 
agreement are limited and mainly in the form of worker

[[Page H6296]]

assistance related to reducing capacity within these countries. Of 
course, capacity reduction benefits shipbuilding industries worldwide.
  You will hear debate today that we should not cut back our title XI 
loan guarantee program to conform to the agreement because it would 
take away the one subsidy that our shipyards have. Do not be misled by 
this argument. If we do not implement this agreement out of fear of 
having to scale back on our title XI and other programs, we will permit 
our trading partners to increase the level of subsidies that they 
provide to their industries to a level far beyond any U.S. subsidies--
and the U.S. industry will not be able to compete under those 
circumstances. The simple fact is that it is highly unlikely that 
Congress will vote to increase subsidies for the U.S. shipbuilding 
industry to make it more competitive with highly subsidized foreign 
shipyards. As a result, the only way our industry can be competitive is 
to force its competitors to give up their subsidies and their ability 
to engage in unfair pricing practices. That is precisely what this 
agreement does.

  You will also hear debate today that we should simply reject the 
agreement we have and return to the negotiating table in an attempt to 
cut an even better deal for our industry. This argument is misguided as 
well. The agreement took 5 years to conclude and was the product of 
hard bargaining and concessions on all sides. Our trading partners are 
giving up billions of dollars in subsidies. The biggest change that we 
have to make is to change the terms of our loan guarantee program. Our 
trading partners have told us that if we do not implement this 
agreement in a timely manner, support for the agreement in their 
countries will erode and vanish. In fact, I have letters from the 
European Community, Japan, Norway, and the OECD itself stating that 
renegotiating the agreement is simply impossible. If we fail, we will 
return to the days when the foreign industries are heavily subsidized 
but the U.S. industry is not.
  You will also hear that this bill forces us to eliminate our title XI 
program in order to comply with the agreement. That is not the case. We 
are able to retain title XI, although we have to scale it back to meet 
the agreement requirements, just as every other signatory must do. We 
can even maintain the same funding levels as we currently have.
  Opponents to the agreement are raising the specter that our national 
defense is somehow at risk unless we adopt the amendment. That is 
simply untrue. The agreement itself contains an exception that allows a 
government to back away if it believes its national security interests 
are at stake. The Department of Defense has also sent us a letter 
stating, and I quote, that ``the agreement will not adversely affect 
our national security.'' Mr. Chairman, if our own Defense Department 
can make such a bold statement, it is powerful evidence that the 
agreement does not threaten our national security.
  Mr. Chairman, the shipbuilding agreement represents a good deal. In 
an effort to save our shipbuilding industry and in the spirit of 
bipartisanship, I urge my colleagues to vote for H.R. 2754.
  Mr. Chairman, I reserve the balance of my time.
  Mr. GIBBONS. Mr. Chairman, I yield 2 minutes to the gentleman from 
Washington [Mr. McDermott].
  (Mr. McDERMOTT asked and was given permission to revise and extend 
his remarks.)
  Mr. McDERMOTT. Mr. Chairman, I rise in support of H.R. 2754, the 
Shipbuilding Trade Agreement Act, and in opposition to the Bateman 
amendment.
  I think the chairman and the ranking member have made the arguments, 
but I think it is important to say that this implements under U.S. law 
an international agreement that sets out the most effective subsidy 
discipline ever included as part of a multilateral trade agreement. It 
also creates under U.S. law an unfair pricing remedy similar to our 
antidumping laws for ships engaged in international trade.
  Mr. Chairman, this bill is unique. It has bipartisan support both 
from the Bush and the Clinton administrations and from the Democrats 
and the Republicans in the House of Representatives. Supporters of this 
legislation include a diverse coalition of maritime interests in this 
country, including the Shipbuilders Council whose membership includes 
17 companies operating 44 shipyards in 13 States. This agreement will 
create the necessary conditions for our commercial shipyards to begin 
to compete once again in the world shipbuilding industry. Foreign 
subsidies have completely forced U.S. shipbuilders out of the 
international market to the point that today U.S. yards have less than 
1 percent of the world market. The Bateman amendment is inconsistent 
with the agreement and will kill it and should be rejected. If we do 
not pass H.R. 2754, we will be back to where we were in the 1980's. Our 
trading partners will continue their subsidizing ways and we will 
continue to engage in predatory pricing practices with impunity.
  Mr. Chairman, I urge my colleagues to reject the Bateman amendment 
and pass H.R. 2754.
  Mr. CRANE. Mr. Chairman, I reserve the balance of my time.
  Mr. GIBBONS. Mr. Chairman, I yield 2 minutes to the gentleman from 
New York [Mr. Rangel].
  (Mr. RANGEL asked and was given permission to revise and extend his 
remarks.)
  Mr. RANGEL. Mr. Chairman, I rise in support of H.R. 2754, in 
opposition to the Bateman amendment, and also to thank Sam Gibbons who 
for so many years has been active in these very sensitive negotiations 
which involve not just shipbuilding today but shipbuilding tomorrow.

                              {time}  1100

  We are all pleased that America now is going into an era of peace, 
that we are moving swiftly from defense into commercial shipping, and 
that we now are going to have to make certain that we can have a plane, 
an equal, a flat playing field as we move forward in economic 
competition with other shipbuilders, and that is exactly what this 
agreement has done.
  It prevents other countries from manufacturing, making ships, and 
dumping them on our markets for less than the price that they actually 
paid for it. It really sets the rules for all of the countries that 
have sat down and realized that there are pluses and minuses in every 
agreement. The subsidies that we have now, sure, we can continue those, 
which are higher than other countries, but that does not mean that 
other countries cannot change if there is no agreement and put in for 
deeper subsidies.
  So what we are talking about is a war between which country is 
prepared to subsidize this industry more than the other. We know that 
we have the expertise, we have the ability to excel, and all we ask is 
that other governments play by the same rules.
  It took 5 years for the Bush administration, the Clinton 
administration, and for other countries to try to figure out what is in 
their best interests, and that is what international treaties are all 
about. It means that those who have an advantage now will not have that 
advantage next year.
  So I think that after all of these years, we cannot have America say, 
yes, we agree; yes, we spent time at the table; but here again we find 
some people that believe that they got a little edge now but are not 
looking at the long picture as to where America will be if we do not 
restrict other countries from depending on subsidies and allow us to 
depend on our expertise, our experience, our high-technology, and know 
that those people, whether they are in military vessels or not can 
succeed in a fair market.
  Mr. CARDIN. Mr. Chairman, I rise in strong support of H.R. 2754 and 
against the Bateman amendment, which would basically defeat the bill.
  First, I really want to compliment the gentleman from Florida, 
Congressman Gibbons, for the work that he has done for so many years to 
bring us to this point by bringing forward legislation in this Chamber 
that have brought our European friends to the table so that we could 
enter into this agreement. We are here today because of his good work 
and we all appreciate that very much.
  Mr. Chairman, the Port of Baltimore was once a great center for 
commercial shipbuilding. During the Second World War we were producing 
the Liberty ships after just a few days of work. We had many commercial 
shipyards located in the harbor area of Baltimore.

[[Page H6297]]

Well, today, we have one major commercial shipbuilding yard that 
remains, and that yard basically competes for repair work.
  The reason why Baltimore lost its shipbuilding was not because it was 
inefficient; it lost its shipbuilding because of international 
subsidies. Other countries were willing to put up tremendous subsidies 
for their shipbuilding and we in this Nation thought that was wrong and 
we protested and protested, but the jobs were lost in this country.
  If we can return to an even playing field, remove the international 
subsidies, we can compete. We are finding commercial shipbuilding 
coming back in this Nation, but it will only come back if we remove the 
international subsidies. We cannot outcompete the Europeans and Korea 
and Japan in the amount of subsidies that they will put forward to 
their shipbuilding. We want a level playing field. This bill gives us 
that level playing field.
  If the Bateman amendment is adopted, we have lost this opportunity to 
eliminate the international subsidies in this area. Let our communities 
rebuild commercial shipbuilding. Support this legislation and vote 
against the Bateman amendment.
  Mr. CRANE. Mr. Chairman, I yield 2 minutes for purposes of control to 
the gentleman from Florida [Mr. Gibbons].
  The CHAIRMAN. Without objection, the gentleman from Florida [Mr. 
Gibbons] will control 2 additional minutes.
  There was no objection.
  Mr. GIBBONS. Mr. Chairman, I thank the gentleman for yielding me that 
time, and I yield 2 minutes to the gentleman from Michigan [Mr. Levin].
  Mr. LEVIN. Mr. Chairman, I thank the distinguished chairman of the 
subcommittee and to the ranking member of the Committee on Ways and 
Means for yielding me this time.
  Mr. Chairman, I just want to say a couple of words on this bill in 
favor of it and against the proposed amendment. This is not a perfect 
solution, but I think it is clear it is the best we are going to be 
able to do under these circumstances, and the alternatives, really, are 
quite a bit worse, unraveling this entire structure.
  I mainly want to focus on a provision that has received very little 
attention and it relates to what is called injurious pricing 
mechanisms. We have fought long and hard in international agreements to 
make sure that there are some strong antidumping provisions.
  These provisions are most beneficial to companies in the United 
States and their workers because it is the United States which has been 
the place where other countries have tried to dump. We have had open 
markets, and other countries have tried to take advantage of that.
  This bill incorporates, in essence, the work that we have been doing 
all these years to try to have a strong antidumping regimen. And as I 
said, in this case, it is framed somewhat differently because we are 
talking about ships, but the thrust of it is the same under the 
terminology ``injurious pricing mechanism.''
  So this is a step forward. It is the best we can do, and it is 
surrounded by provisions that will try to prevent other countries 
injuring our shipbuilding by essentially dumping or undercutting 
through unfair price mechanisms.
  Mr. Chairman, I urge support of the bill and opposition to the 
amendment.
  Mr. GIBBONS. Mr. Chairman, I yield myself 1 minute.
  I regret that the debate is arranged such as it is today because I 
would like to have had the gentleman from Virginia [Mr. Bateman] and 
others participate in this debate so that we could respond to issues 
that are bound to be raised. So let me raise some of the issues.
  First of all, they will say that this agreement does not play fairly 
with the United States. The United States had no subsidies or 
practically had no subsidies when we entered into this agreement. In 
1981, here on this floor in the Gramm-Latta amendment, we abolished 
practically all the subsidies that could be found. One little subsidy 
slipped through, that is the title XI subsidy. It just was not seen and 
was not operative at that time, and we did not take any advantage of 
it.
  Because of the standstill arrangement in this agreement, we were able 
to exploit the title XI subsidy and some small contracts were garnered 
by some of the big navy yards in this country. But the big navy yards 
are not really the huge commercial builders in this country. They 
represent a very small part of the commercial capacity. The commercial 
capacity and the Navy capacity is really somewhat different because of 
specialization of labor and work.

  So we face it today. The gentleman from Virginia [Mr. Bateman] is 
trying to defend his big Navy yard. I do not blame him; I would too if 
I had one of those things. But most of the commercial shipbuilders are 
in non-Navy yards and they are the ones that will profit, along with 
the yard that the gentleman from Virginia represents. It will also 
profit from all of this arrangement if we can get it into position.
  The problem is we have delayed so long, because of the legislative 
process in Congress, getting this matter to the floor, all the other 
nations have already ratified the agreement. We have had to seek 
extension, and our extension runs out tomorrow, and this agreement is 
in the best interest of the greatest number of Americans. We are having 
to give up very little.
  The gentleman from Virginia [Mr. Bateman] only wants to extend his 
slight preference fore another 30 months. Sounds reasonable on its 
face. The only trouble is the other nations of the world just do not 
trust us. Every time we bring agreements to the floor for ratification, 
we have to bring them under a fast track procedure or they will unravel 
here on the floor.
  This agreement was not brought back under a fast track arrangement 
and, therefore, it is being unraveled on the floor by what looks like 
harmless little amendments, and that is what the issue is here today.
  All of the industrialized nations that build ships have already 
served notice on us in writing that if we adopt the Bateman amendment 
today this agreement is dead. Let me repeat that. All of the other 
signatories to this pact have agreed to this proposal, and they have 
served notice on us in writing that if we agree to the Bateman 
amendment this whole agreement is dead.
  We do not have any choice. And it would not be a good choice anyway, 
because if the Bateman amendment ever becomes law the standstill 
arrangement that is in this pact will have expired and other nations 
can meet or match or better the Bateman subsidies. It will not work.
  Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from 
Massachusetts [Mr. Studds] for a colloquy.
  Mr. STUDDS. Mr. Chairman, I want to engage the manager of the bill, 
the distinguished gentleman from Illinois [Mr. Crane], for one moment.
  When the agreement was negotiated, it was agreed that U.S. 
shipbuilders would have a full 3 years to deliver vessels financed with 
favorable lending terms under title XI. This is critical to many of our 
shipyards, including one in my district. Since we are late in passing 
implementing legislation, some have suggested our yards will have only 
2 or 2.5 years to deliver the vessels.
  I know the U.S. Trade Representative has taken steps to make sure 
that our yards have a full 3 years from the effective date of the 
agreement to deliver the so-called subsidized vessels. I wanted to 
confirm that this is the understanding of the gentleman from Illinois 
and that he can give us his assurance that he will do everything he can 
to ensure U.S. yards have the 3-year delivery window.
  Mr. CRANE. Mr. Chairman, will the gentleman yield?
  Mr. STUDDS. I yield to the gentleman from Illinois.
  Mr. CRANE. Mr. Chairman, my understanding is if before July 15 this 
were to occur, that it would be in order, but that ultimately is an 
administration decision, and I have no input whatsoever that they would 
have any objections to that.
  Mr. STUDDS. I appreciate that.
  My second point is MarAd has a number of title XI applications in the 
pipeline, ones submitted many months ago and are substantially 
completed. Is it the gentleman's understanding that MarAd will be 
allowed to offer the favorable terms, depending on title XI 
applications which are substantially complete, and to work with me to 
ensure that applications, such as that

[[Page H6298]]

from the Quincy shipyard, are eligible for the favorable terms before 
the agreement enters into effect?
  Mr. CRANE. That is my understanding. As I say, it would be an 
administration interpretation, but I do not think there would be a 
problem.
  Mr. STUDDS. Mr. Chairman, I thank the gentleman, and I thank the 
gentleman from Florida for the time.
  Mr. CRANE. Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN. The time of the gentleman from Florida [Mr. Gibbons] 
has expired; the gentleman from Illinois [Mr. Crane] yields back the 
balance of his time.
  The gentleman from South Carolina [Mr. Spence] will be recognized for 
15 minutes and the gentleman from California [Mr. Dellums] will be 
recognized for 15 minutes.
  The Chair recognizes the gentleman from South Carolina [Mr. Spence].
  Mr. SPENCE. Mr. Chairman, I yield myself such time as I may consume.
  (Mr. SPENCE asked and was given permission to revise and extend his 
remarks.)
  Mr. SPENCE. Mr. Chairman, now it is time to hear the other side of 
the story. Today I rise to express my support not for the OECD 
shipbuilding trade agreement, or H.R. 2754, but for the amendment that 
will be offered by my colleague, the gentleman from Virginia [Mr. 
Bateman].
  H.R. 2754, the Shipbuilding Trade Agreement Act, would implement the 
Organization for Economic Cooperation and Development, or OECD, 
agreement on shipbuilding. This agreement, which was signed in December 
1994 by the United States and other major shipbuilding countries, 
eliminates most shipbuilding subsidies provided by signatory countries 
to their shipbuilding industry or ship operators.

                              {time}  1115

  The OECD agreement also includes provisions designed to eliminate 
anticompetitive pricing practices which would have allowed some 
countries to sell ships on the open market at unfairly low prices.
  Many Members of the House, and certainly the Committee on National 
Security, consider the base bill to be seriously flawed. Many believe 
that the agreement negotiated by the administration contains loopholes 
that will allow foreign shipyards to continue to receive subsidies, 
while we will have abolished our successful loan guarantee program for 
struggling U.S. shipbuilders.
  Many believe that the OECD agreement does not give America's major 
shipyards, most of which have primarily been in the business of 
building U.S. Navy ships, sufficient time to transition form military 
to commercial work.
  Still others are concerned that the agreement will adversely affect 
the Jones Act and could prevent shipyards from building vessels for 
domestic shipping without penalty.
  Finally, many are concerned that the existing OECD agreement does not 
allow the United States adequate flexibility to protect its national 
security interests and to exempt from the agreement ships that serve 
military purposes. In short, many Members believe that the agreement 
negotiated by the administration is seriously flawed.
  The Bateman amendment, which was agreed to in the Committee on 
National Security and enjoys strong bipartisan support, attempts to 
correct many of the flaws I have described. In the debate ahead, the 
gentleman from Virginia [Mr. Bateman] and others will address the 
constructive fixes his amendment proposes for the title XI program, the 
Jones Act, and important definitional issues. It is an important 
amendment that deserves Members' attention and support.
  Suffice it to say, Mr. Chairman, H.R. 2754 is a flawed bill that 
would implement an imperfect agreement. Regardless of how Members feel 
about voting on final passage of this bill, I strongly encourage my 
colleagues to vote in favor of the Bateman amendment, which goes a long 
way toward protecting our national security interests.
  Mr. Chairman, I ask unanimous consent that I be permitted to yield 
the remainder of my general debate time to the gentleman from Virginia 
[Mr. Bateman] and that he be permitted to manage and control such 
debate time.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
South Carolina?
  There was no objection.
  Mr. DELLUMS. Mr. Chairman, I yield myself 7 minutes.
  (Mr. DELLUMS asked and was given permission to revise and extend his 
remarks.)
  Mr. DELLUMS. Mr. Chairman, I too join the gentleman from Florida in 
his concern with respect to the nature of this process. We were told 
that the Committee on Ways and Means wanted to exercise their option to 
debate on this matter for the first 30 minutes, otherwise this 
gentleman would have been more than willing to engage in significant 
debate because I think this is an important issue.
  Obviously, the bill before us is designed to put the Congress in the 
position to ratify an agreement, the purpose of which is to end 
subsidies, Government subsidies, in the shipbuilding industry across 
the world.
  There have been great allusions to the amendment that will be offered 
by the gentleman from Virginia [Mr. Bateman]. They have suggested that 
in offering the amendment, the ratification of this amendment would 
kill the agreement. Let us step back for a moment.
  First of all, we believe that what we are being asked to agree to is 
a flawed agreement. Congress does, indeed, have a role in this process 
to ratify. Are we simply rubber stamps, or do we have the option to 
exercise our intellectual and political responsibilities in this 
matter? If we do, then it seems to me that it is perfectly within our 
right and prerogatives to offer an amendment. Now, that is the nature 
of the process, otherwise why have the agreement here?
  We think that it is indeed flawed. The stakeholders in this issue, 
the workers, the union people, the shipbuilders looked at this 
agreement and said long term they agree with the purpose. But the 
problem with this agreement is in the transition. We believe that the 
U.S. shipbuilders have been grossly disadvantaged.
  Now, we believe that in offering this amendment and accepting this 
amendment, it would be not unlike many other exceptions and exemptions 
from other countries, and I will point them out in a moment. If we pass 
it, they will simply go back with the exception, exemption, and 
renegotiate, because it is in the world's collective interest to stop 
subsidies. Other countries, other governments do not wish to continue. 
That is the imperative. That is the self-interest that will drive 
everyone back.
  Now, are we doing something different, Mr. Chairman, than any other 
country? Example: Foreign governments were granted the following 
subsidy packages and the authority to continue paying out existing 
subsidies for ships delivered up until January 1, 1999: Spain, $1.4 
billion in restructuring aid; Portugal, $110 million in restructuring 
aid; Belgium, $74 million in restructuring aid; South Korea, 
restructuring aid amount unknown, but based on information we have 
received it includes the $750 million plus government bailout of Daeoo 
Shipyard begun in 1990.

  With respect to France, unknown at this time in terms of the overall 
amount, but special offers are currently being made by other Members of 
the European Community to gain France's support for the agreement; 
minimally, $480 million. Germany: Germany has a package for exemption. 
Germany's package to modernize, restructure and cover the loss of the 
shipyards in former East Germany, we believe that that figure adds up 
to approximately $4 billion.
  So, what the United States is asking in comparison to these other 
countries, they went back in, Mr. Chairman, and renegotiated these 
exceptions and these exemptions. Title XI did not just happen; it just 
did not sneak in through the back-door. The distinguished gentleman 
from Mississippi [Mr. Taylor] and this gentleman, during the time when 
this party was in control of the Congress, put $50 million in loan 
guarantees in title XI because we saw that we cannot specialize in 
these shipyards because not enough work is being done.
  So we took DOD money, put it into loan guarantees, leveraged it. Do 
my colleagues know what happened? Shipbuilding began on a commercial 
level in this country unprecedented in the last one or two decades.

[[Page H6299]]

  Now, Mr. Chairman, we are simply saying that we would like to be on a 
level playing field. Ultimately, let us end all subsidies, but in the 
transition give us the opportunity to make the transition correctly. 
Leave title XI in for 3 years. That simply puts us on a level playing 
field, not only at the end of the day but in the transition period.
  Now, we need to understand Mr. Chairman, 90 percent of the American 
workers in this country work in the top six shipyards in America. So if 
my colleagues care about working-class people, if they care about the 
working people in this country, they work in the top six yards in 
America.
  There is no such thing anymore as specialized shipbuilding. We do not 
do as much. At one point we were moving toward a 600-ship Navy. The 
cold war is over, the military budget is coming down, and we are 
battling over how fast and how deep that it does come down. 
Shipbuilding is coming down in terms of military activity, so where do 
we have to balance that out? With commercial development.
  We simply say at the end of the day, my conclusion is this. We are 
simply asking for what other signatories went in and renegotiated. This 
is not going to kill this agreement. It is in everybody's interest to 
get to the table.
  We are simply saying let us not be fools. Let us go in intelligently, 
with our self-interest involved, and let us make this decision here. 
That is what our responsibility is. We have a fiduciary responsibility 
to the American people. Let us carry it out. If the other countries do 
not particularly like this, then let us ask them, ``Why did you ratify 
these other exceptions?'' They will not do it. They will come back to 
the table because it is in their self-interest.
  Mr. Chairman, I hope my colleagues will support the Bateman 
amendment. Without it, it seems that this agreement is not supportable.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BATEMAN. Mr. Chairman, I yield myself 3 minutes.
  Mr. Chairman, I would like to first associate myself with the 
splendid remarks of the gentleman from California [Mr. Dellums], who I 
think has very well articulated what is before the House today. Let me 
say, in order to try and reinforce and to place this debate in context, 
that I heard today that the amendments which I will offer are 
reasonable and they are modest, and yet I am told that we will unravel 
the agreement if this House, in pursuit of what it conceives to be 
sound public policy for the United States of America, were to adopt 
those amendments.
  This presumably is a meaningful process. If this agreement is flawed, 
and I put it to my colleagues that it is very seriously flawed, then we 
should not approve it and implement it.
  Mr. Chairman, I am not asking this House to reject this amendment. I 
am asking this House to adopt amendments which would remove the flaws 
and the warps from this agreement so that it at least is arguably in 
the best interest of the people of the United States and our national 
security.
  To do less, Mr. Chairman, would in my view be an abdication of our 
responsibility. Much has been said about how long this agreement was in 
process of negotiation. I think there is something that needs to be 
said about that.
  During the course of the Bush administration, no agreement could be 
struck, and the reason it could not be struck is because there was an 
insistence on the part of this country that we protect and preserve the 
Jones Act for our domestic internal trade.
  This agreement does not protect the Jones Act, as least according to 
all of the people who have said my amendment undermines the agreement, 
because we make it explicit by my amendment that the Jones Act shall 
not be affected because that is what the U.S. Trade Representative told 
us.
  But now even they are saying the Bateman amendment, by making it 
explicit that the Jones Act will be protected, is going to unravel the 
agreement. This is not a treaty or an agreement that I think has been 
dealt with very uprightly in terms of what it does and does not 
include. Clearly, we should insist through my amendment that we 
preserve the Jones Act inviolate.
  To say that we should have no interim transition provisions 
protecting our shipbuilding is, I think, again a terrible mistake, 
especially when we look at it in the context that has been pointed out, 
that numerous other parties who are signatories to this agreement were 
taken care of by transition provisions for their shipyards while we 
have none.
  Our trade representative came back after he signed this agreement in 
December and admitted to me that they had not even sought any 
transition provisions for this country's shipbuilders, even though the 
other parties to this agreement had been subsidized to the tune of as 
much as $8 billion a year when we were not subsidizing at all, and yet 
they sought no concession or transition provision for American 
shipbuilders.
  Mr. Chairman, that is why this agreement is flawed. That is why it 
needs the amendments.
   Mr. Chairman, I reserve the balance of my time.
  Mr. BATEMAN. Mr. Chairman, I yield 3 minutes to the gentleman from 
Tennessee [Mr. Quillen].
  Mr. QUILLEN. Mr. Chairman, I thank the gentleman for yielding.
   Mr. Chairman, I rise in support of the National Security Committee 
amendment to H.R. 2754. The amendment offered by the National Security 
Committee will mitigate the damage this shipbuilding trade agreement 
will have on our national security interests and our defense 
shipbuilding industrial base. No commercial trade agreement should 
place restrictions on our domestic Jones Act trade. The Jones Act fleet 
and the industrial base sustained through construction of ships for 
this trade is an essential arm of our military in a contingency.
  During the Gulf war, shipyards worked around the clock to activate 
moth-balled ships to transport our tanks and helicopters to our forward 
deployed troops, and the mariners who operated our Jones Act fleet in 
peacetime were called upon to crew these military reserve vessels. The 
Department of Defense has stated that the Jones Act is essential to our 
national security interests. The House National Security Committee 
amendment will ensure that the Jones Act ship construction and 
operating requirement is not jeopardized by this agreement.
  It will also clarify that noncombatant military auxiliary and sealift 
ships are not covered by this agreement. No commercial trade agreement 
should restrict the U.S. Department of Defense from procuring surge and 
prepositioning sealift ships needed to meet our Army and Marine Corps 
requirements. This was not the intent of these negotiations; however, 
this will be the case unless the National Security Committee amendment 
is passed.
  I also support the 30-month extension of our title XI ship loan 
guarantee program which has enabled our navy shipbuilders to transition 
back into the business of building large ocean-going commercial ships. 
This commercial work has created 4,000 jobs in our shipyards, and 
helped to sustain our critical Navy shipbuilding base during a 
historical low in Navy shipbuilding orders. This limited extension of 
title XI is very modest compared to the 3- and 4-year transition 
subsidies granted to foreign signatories of this trade agreement--
subsidies above and beyond their already massive subsidies.
  I urge my colleagues to vote for the National Security Committee 
amendment.

                              {time}  1130

  The CHAIRMAN. The Chair advises that the gentleman from Virginia [Mr. 
Bateman] has 5\1/2\ minutes remaining, and the gentleman from 
California [Mr. Dellums] has 8 minutes remaining.
  Mr. DELLUMS. Mr. Chairman, I yield 4 minutes to the distinguished 
gentleman from Mississippi [Mr. Taylor].
  Mr. TAYLOR of Mississippi. Mr. Chairman, I thank the distinguished 
Member for yielding the time.
  No one comes here to increase the deficit. No one comes here to 
dismantle America's might. But just last night, the new majority voted 
for a budget for the next 2 years that increases the annual operating 
deficit and in turn the national debt. Today we are going to have a 
choice of whether or not we are going to dismantle America's industrial 
might. I have to my left, and I hope the television camera can show

[[Page H6300]]

this, one of the 66 jewels of America's industrial might. It is so huge 
that this 990-foot warship appears to be but a toy when compared to 
that overall industrial facility. It is called Ingalls Shipbuilding and 
is one of the six remaining shipyards in America that build ships to 
defend our country.
  This agreement would preclude any chance Ingalls Shipbuilding ever 
has of in the long run staying in business. And that is what it comes 
down to. You see, as mentioned before, during the Reagan years there 
was talk of a 600-ship Navy and therefore people like Ingalls and 
Newport News would have plenty of work building those ships. We are now 
looking at a 150-ship Navy, which means there is not work for all six 
of them. If we do not find commercial work for those yards, they will 
simply go out of business. Why is that important?
  This island nation during World War II had to build 16,000 ships to 
save itself from Japan and Nazi Germany. We are now down to what will 
be in the near future a 150-ship fleet so, if we lose our ability in 
the meantime between wars to do some commercial work, those yards will 
not be around. If you had to start this yard from scratch, you would 
have to find $800 million. That just is not going to happen.
  So why is the agreement bad? The agreement is bad because we are 
counting on about 20 other nations to quit subsidizing their yards 
unilaterally. It is not going to happen. It has not happened. Even 
today in the Journal of Commerce, here is the story, that the Danes, 
even before the ink on this agreement is dry, are already cheating on 
this agreement. The reason the Danes say that they are cheating is 
because the Germans are cheating.
  So we are being asked by the Committee on Ways and Means to 
unilaterally disarm, to give away the ability of our Nation to defend 
itself in future wars. So the Committee on Ways and Means can proudly 
proclaim that they have passed another failed trade agreement. May I 
remind them of their tremendous success of NAFTA? May I invite the 
Committee on Ways and Means to come to Lucedale, MS, or to Hattiesburg, 
MS, or Poplarville, MS, and go to the cattle auction and see the 
cattlemen who cry because they are selling their calves for one-half of 
the price that they were just 3 years ago before NAFTA. Or maybe once 
again to go to Lumberton, MS, or Poplarville, MS or Wiggins, MS or 
Neely, MS, or Gulfport, MS and visit the empty garment plants where 
thousands of people have been laid off as a direct result of NAFTA. In 
Neely, MS, when you lose your job, job retraining does not matter 
because there is no other factory in Neely, MS. The only business in 
town shut down.

  So based on the success of NAFTA and our ability to pass an agreement 
that hurts only us and helps only our competitors, we want to do this 
again, except this time we want to do it with regard to national 
defense. We want to take the magnificent machine built up over the 
course of the past century, first by Democrats like FDR and later by 
Republicans like Ronald Reagan and George Bush, and we want to put it 
out of business so that when the next war comes we will not have a 
yard. And maybe if we are lucky, the Germans will sell us a ship. Maybe 
if we are lucky the Japanese will sell us a ship. But maybe if we are 
not lucky, they will be on the other side. Then what do we do?
  The great powers of the world have always been great manufacturers, 
and they have been great maritime powers. Those two things go hand in 
hand during the course of recorded history. With NAFTA, we have given 
away a lot of our manufacturing might. With this agreement, they are 
trying to give away our maritime might, what is left of it, and our 
ability to get back in the business.
  Title XI works. It is a loan guarantee program that works. We are 
building ships in this country, and now they are saying, let us take it 
away. The gentleman from Virginia [Mr. Bateman] is saying, let us slow 
that down a little bit.
  I encourage Members to vote for the Bateman amendment. At the very 
least it will slow it down a little bit. And then I encourage Members 
to vote against this entire agreement because we do not need to give up 
our sovereignty to 20 other countries to tell us where and when we can 
invest in the industrial might of this Nation.
  Mr. BATEMAN. Mr. Chairman, I yield 3 minutes to the gentleman from 
California [Mr. Hunter].
  Mr. HUNTER. Mr. Chairman, I want to thank the distinguished gentleman 
from Virginia for yielding to me. I want to note to my colleagues in 
the full committee and all the Members that this is one of those 
occasions, as you can see with respect to this substitute amendment, 
there is solidarity in the Committee on National Security, on the 
Democrat side, on the Republican side, on all shades of the political 
spectrum. This is the reason: No matter how much we disagree about 
weapons systems and about strategies and about budget numbers, we all 
agree on one thing, one fact that comes home to us every time we have a 
conflict. When we move out to project American power, we carry that 
power, whether it is marines or soldiers or ammunition or aircraft and 
all the logistics that you have to take to a foreign place to fight a 
war on ships.
  In Desert Storm we carried 95 percent of our war materiel on ships, 
not on airplanes, and everybody knows that. The gentleman from 
California [Mr. Dellums] knows that. The gentleman from South Carolina 
[Mr. Spence] knows that. Every member of the committee knows that. 
Every Member of the House knows that. With respect to our ability to 
move to change this amendment, all of our allies know that. All of the 
signatories of this agreement know that.
  South Korea is not going to complain because we want to maintain our 
shipbuilding base. South Korea exists because we had a shipbuilding 
base. We saved them as the North Koreans were driving down the Korean 
Peninsula and the Chinese shortly thereafter because we were able to 
move an American blocking force in there, hold the line and gradually 
push it back.
  Our European allies are not going to complain because two times in 
this century we have saved Europe with American ships carrying American 
personnel and war materiel. Our allies who depended on the lifeline in 
the Gulf war understand that, while we had to rely on rent-a-ships in 
that case, 95 percent of the American equipment that was carried to 
that war was carried on ships.
  Now, this bill, if it is not amended by the national security 
substitute, is going to do some bad things because theoretically it 
excludes military construction but it reserves for foreign judges the 
definition of what is a military program. It warns us against 
``disguising commercial shipbuilding in military programs.'' That means 
somebody else is going to be interpreting what is an American military 
program.
  Is a prepositioning ship an American military program or just another 
way to have commercial cargo or to have logistics that you might be 
taking on a rent-a-ship? Is that an American military program? In the 
WTO we are now seeing these decisions come home where they have 
enforced Brazil's right to send dirty gas into the United States 
because foreign judges have said American environmental laws are 
invalid. We have seen the problem with giving to foreign judges the 
right to arbitrate and to determine what is an American military 
program.
  Let me urge all of my colleagues to support the national security 
position on this and vote against the full bill on final passage.
  Mr. DELLUMS. Mr. Chairman, I yield myself the balance of my time.
  The CHAIRMAN. The gentleman from California [Mr. Dellums] is 
recognized for 4 minutes.
  Mr. DELLUMS. Mr. Chairman, the bill, H.R. 2754, provides the Congress 
of the United States with the opportunity to ratify an agreement, the 
purpose of which is to end government subsidies in shipbuilding. I 
believe that it is in the interest of the shipbuilding industry and in 
the interest of the American worker and ultimately the American people 
that we ratify a treaty, the purpose of which is to end Government 
subsidies. That is indeed in our interest.
  I would like to take this opportunity to applaud the gentleman from 
Florida [Mr. Gibbons], who has perhaps beyond any other Member of this 
body worked tirelessly to get such an agreement because he had the 
wisdom and the vision to understand that it is indeed in the

[[Page H6301]]

interest of the United States to end Government subsidy. For that, I 
applaud the gentleman. I am one of the gentleman's greatest fans.
  My point of departure today with my distinguished colleague is very 
simple and very straightforward. I believe that the agreement is flawed 
in its transition implications. We are simply saying that we need to 
put the United States in a better position in this transition period, 
as we move from a heavy reliance on military dollars, building hundreds 
of military ships, to building commercial ships.

  As I look at the experience around this agreement, I have come to the 
startling realization but the comforting realization that other 
countries saw problems in the transition and sought exemptions and 
exceptions prior to signing the agreement that would allow them to step 
forward and then sign the agreement.
  I believe that the notion that if the Bateman amendment passed that 
it would kill the agreement is hyperbole. But I have been here going on 
26 years, and I know how we can engage in hyperbole in this 
institution. The amendment will kill the bill. But that is hyperbole, 
and I love the Members that say it, but we often practice overstatement 
and hyperbole.
  You have to be bright enough to cut through the weed and get to the 
real issue. It is not going to kill this agreement, because it is in 
the world's collective interest to end government subsidies. That 
imperative and that imperative alone will drive everybody back to the 
table.
  If we pass this agreement, the world is not going to step back and 
say, well, you guys are going to do this, I am going to spend $2 
billion a year subsidizing shipbuilding. That is bizarre, extreme and 
absurd. What they will do is sit down and try to work it out. That is 
all we are simply saying.

                              {time}  1145

  Finally, as I said in my opening remarks, if the Congress did not 
have any role, then why are we here to ratify it? And I think our role 
should go beyond simply rubber stamping when we believe substantively, 
economically, politically and intellectually that there is something 
wrong with the agreement. Working people in this country looked at it 
and said it is flawed in the transition. Shipbuilding people looked at 
it and said it is flawed in its transition. These are two major 
stakeholders who believe ultimately that we ought to end government 
subsidy.
  So we stepped up to the plate and said, ``Let's correct it, let's 
clarify on the Jones Act, let's clarify some boilerplate language with 
respect to national security issues.
  That is all this amendment does. I urge my colleagues to listen 
carefully to the debate around the Bateman amendment, not be guided by 
hyperbole and overstatement, and look at the facts, and I believe that 
they will come to the conclusion that we are correct. Adopt the Bateman 
amendment, and go forward to pass H.R. 2754, as amended.
  Mr. BATEMAN. Mr. Chairman, I yield 2 minutes to the gentleman from 
Maine [Mr. Longley].
  Mr. LONGLEY. Mr. Chairman, the reason we are debating these 
amendments to this trade agreement today is that we are seeking at 
least some element of fairness to our shipbuilders. The reason we are 
debating these amendments is that we believe it is important to 
maintain these critical manufacturing jobs that shipbuilding and the 
supplier base provides. The reason we are debating these amendments is 
that many of us fear this trade agreement will be like so many before 
it--one that is unfair to the United States and that will send these 
jobs to other countries.
  But let us not lose sight of the most important reason we are 
debating these amendments: and that is, that we are concerned about the 
national security of this country. You see, we have gotten to the point 
where the shipbuilding industrial base that embodies the critical 
skills and facilities needed to produce our Navy's ships has shrunken 
to just six shipyards and 70,000 employees. These same shipyards are 
the ones that have historically produced most of the large, oceangoing 
ships built in this country for both our domestic and international 
trades. Commercial shipbuilding has always been essential to helping 
level out the valleys when the government's purchase of ships has 
declined.
  We are at this very moment considering Navy shipbuilding budgets that 
are the lowest in over 40 years! And while the Congress is attempting 
to increase that level slightly, the numbers of ships being ordered by 
the Navy are simply not sufficient to sustain the bare minimum 
shipbuilding base we now have. And if we are going to even come close 
to maintaining the 346-ship Navy that forms the basis of our current 
warfighting strategy, we are going to ask these same shipbuilders a few 
years from now to increase their rate of shipbuilding to two to three 
times what it is today.
  Even with these amendments, we are perilously close to signing away 
our capability to ensure economic and national security through our 
shipbuilding industrial base.
  I urge my colleagues to join me in voting for jobs and for national 
security. Vote for the National Security Committee amendments.
  Mr. BATEMAN. Mr. Chairman, I yield myself the 30 seconds remaining 
only to remind the Members of the House that the six major shipyards 
who are diametrically opposed to this agreement in its present form 
represent 300,000 jobs at their shipyards and in the companies that 
service and work with them. This is over 90 percent of all the workers 
engaged in ship construction in the United States, and these shipyards 
build 98 percent of all ships for the United States Navy. We are 
speaking not just for those shipyards, but for all of the unions and 
the workers who are employed in those shipyards and for whom my 
amendments to this bill are extremely significant and are very 
intensely supported by those people.
  Mr. BLILEY. Mr. Chairman, I rise in support of the efforts of the 
gentleman from Virginia [Mr. Bateman] regarding our Nation's 
shipbuilding industrial base by ensuring that industry's success in its 
endeavor to participate in commercial shipbuilding on the international 
level. I speak on this matter to support my colleague, and to note my 
interest as chairman of the Committee on Commerce in the issue of 
dumping.
  In support of my colleague, I signed a letter delineating the problem 
created by the OECD Shipbulding Agreement that H.R. 2754 would 
implement. The agreement fails to remedy the historical advantage 
foreign shipbuilders have maintained over the U.S. shipbuilding 
industry through government subsidies. Although the agreement does 
eliminate certain aspects of foreign government subsidies, it still 
does not place U.S. shipbuilders on equal footing with foreign 
shipbuilders in the international market. Therefore, I support Mr. 
Bateman's efforts to create an even playing field.
  My interest in the matter as chairman of the Committee on Commerce 
stems from my committee's extensive work in the area of trade. H.R. 
2754 would add a new title, ``Title VIII--Injurious Pricing and 
Countermeasures Relating to Shipbuilding'' to the Tariff Act of 1930, 
The new title VIII would provide a mechanism, tailored to the unique 
situation of the shipbuilding industry, to address concerns regarding 
the practice of dumping--selling goods, in this case ships, for less 
than their fair value.
  Without recounting the lengthy history of my committee's work in the 
area of trade, I will point out just a few previous legislative 
initiatives--focusing on the 100th Congress--that addressed dumping. 
During the 100th Congress, at least four trade measures considered by 
the Commerce Committee were incorporated into the Omnibus Trade Reform 
Act of 1988. Although other measures included provisions on the issue 
of dumping, H.R. 268--notably--addressed only the issue of dumping. 
Through that measure, my committee and others sought to amend the 
Tariff Act of 1930 ``to provide private remedies for injury caused by 
unfair foreign competition and violations of certain customs fraud 
provisions.''
  Just as H.R. 268 establishes remedies where an article ``is imported 
or sold within the United States at a United States price which is less 
than the foreign market value or constructed value of such article,'' 
H.R. 2754 provides for remedies where ``a foreign vessel has been sold 
directly or indirectly to one or more United States buyers at less than 
its fair value.'' Therefore, my interest in this measure is twofold. 
First, I want to support my colleague Mr. Bateman; and second, I want 
to express my committee's jurisdictional interest in the dumping 
provisions of this measure. Based on my committee's lengthy history of 
work in the area of trade, and on the issue of dumping. I would like to 
note our intent to continue in the exercise of our authority in these 
areas.

[[Page H6302]]

  The CHAIRMAN. All time for general debate has expired.
  Pursuant to the rule, the amendment in the nature of a substitute, 
recommended by the Committee on Ways and Means, modified by the 
amendment printed in part 1 of House Report 104-606, is considered as 
an original bill for the purpose of amendment and is considered read.
  The text of the committee amendment in the nature of a substitute, as 
modified, is as follows:

                               H.R. 2754

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Shipbuilding Trade Agreement 
     Act''.

     SEC. 2. APPROVAL OF THE SHIPBUILDING AGREEMENT.

       The Congress approves The Agreement Respecting Normal 
     Competitive Conditions in the Commercial Shipbuilding and 
     Repair Industry (hereafter in this Act referred to as the 
     ``Shipbuilding Agreement''), a reciprocal trade agreement 
     which resulted from negotiations under the auspices of the 
     Organization for Economic Cooperation and Development, and 
     was entered into on December 21, 1994.

     SEC. 3. EFFECTIVE DATE.

       This Act and the amendments made by this Act take effect on 
     the date that the Shipbuilding Agreement enters into force 
     with respect to the United States.
             TITLE I--INJURIOUS PRICING AND COUNTERMEASURES

     SEC. 101. INJURIOUS PRICING AND COUNTERMEASURES PROCEEDINGS.

       The Tariff Act of 1930 is amended by adding at the end the 
     following new title:
    ``TITLE VIII--INJURIOUS PRICING AND COUNTERMEASURES RELATING TO 
                              SHIPBUILDING

       ``Subtitle A--Injurious Pricing Charge and Countermeasures

``Sec. 801. Injurious pricing charge.
``Sec. 802. Procedures for initiating an injurious pricing 
              investigation.
``Sec. 803. Preliminary determinations.
``Sec. 804. Termination or suspension of investigation.
``Sec. 805. Final determinations.
``Sec. 806. Imposition and collection of injurious pricing charge.
``Sec. 807. Imposition of countermeasures.
``Sec. 808. Injurious pricing petitions by third countries.

                      ``Subtitle B--Special Rules

``Sec. 821. Export price.
``Sec. 822. Normal value.
``Sec. 823. Currency conversion.

                        ``Subtitle C--Procedures

``Sec. 841. Hearings.
``Sec. 842. Determinations on the basis of the facts available.
``Sec. 843. Access to information.
``Sec. 844. Conduct of investigations.
``Sec. 845. Administrative action following shipbuilding agreement 
              panel reports.

                       ``Subtitle D--Definitions

``Sec. 861. Definitions.
       ``Subtitle A--Injurious Pricing Charge and Countermeasures

     ``SEC. 801. INJURIOUS PRICING CHARGE.

       ``(a) Basis for Charge.--If--
       ``(1) the administering authority determines that a foreign 
     vessel has been sold directly or indirectly to one or more 
     United States buyers at less than its fair value, and
       ``(2) the Commission determines that--
       ``(A) an industry in the United States--
       ``(i) is or has been materially injured, or
       ``(ii) is threatened with material injury, or
       ``(B) the establishment of an industry in the United States 
     is or has been materially retarded,

     by reason of the sale of such vessel, then there shall be 
     imposed upon the foreign producer of the subject vessel an 
     injurious pricing charge, in an amount equal to the amount by 
     which the normal value exceeds the export price for the 
     vessel. For purposes of this subsection and section 
     805(b)(1), a reference to the sale of a foreign vessel 
     includes the creation or transfer of an ownership interest in 
     the vessel, except for an ownership interest created or 
     acquired solely for the purpose of providing security for a 
     normal commercial loan.
       ``(b) Foreign Vessels Not Merchandise.--No foreign vessel 
     may be considered to be, or to be part of, a class or kind of 
     merchandise for purposes of subtitle B of title VII.

     ``SEC. 802. PROCEDURES FOR INITIATING AN INJURIOUS PRICING 
                   INVESTIGATION.

       ``(a) Initiation by Administering Authority.--
       ``(1) General rule.--Except in the case in which subsection 
     (d)(6) applies, an injurious pricing 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 charge under section 801(a) 
     exist, and whether a producer described in section 861(17)(C) 
     would meet the criteria of subsection (b)(1)(B) for a 
     petitioner.
       ``(2) Time for initiation by administering authority.--An 
     investigation may only be initiated under paragraph (1) 
     within 6 months after the time the administering authority 
     first knew or should have known of the sale of the vessel. 
     Any period in which subsection (d)(6)(A) applies shall not be 
     included in calculating that 6-month period.
       ``(b) Initiation by Petition.--
       ``(1) Petition requirements.--(A) Except in a case in which 
     subsection (d)(6) applies, an injurious pricing proceeding 
     shall be initiated whenever an interested party, as defined 
     in subparagraph (C), (D), (E), or (F) of section 861(17), 
     files a petition with the administering authority, on behalf 
     of an industry, which alleges the elements necessary for the 
     imposition of an injurious pricing charge under section 
     801(a) and the elements required under subparagraph (B), (C), 
     (D), or (E) of this paragraph, and which is accompanied by 
     information reasonably available to the petitioner supporting 
     those allegations and identifying the transaction concerned.
       ``(B)(i) If the petitioner is a producer described in 
     section 861(17)(C), and--
       ``(I) if the vessel was sold through a broad multiple bid, 
     the petition shall include information indicating that the 
     petitioner was invited to tender a bid on the contract at 
     issue, the petitioner actually did so, and the bid of the 
     petitioner substantially met the delivery date and technical 
     requirements of the bid,
       ``(II) if the vessel was sold through any bidding process 
     other than a broad multiple bid and the petitioner was 
     invited to tender a bid on the contract at issue, the 
     petition shall include information indicating that the 
     petitioner actually did so and the bid of the petitioner 
     substantially met the delivery date and technical 
     requirements of the bid, or
       ``(III) except in a case in which the vessel was sold 
     through a broad multiple bid, if there is no invitation to 
     tender a bid, the petition shall include information 
     indicating that the petitioner was capable of building the 
     vessel concerned and, if the petitioner knew or should have 
     known of the proposed purchase, it made demonstrable efforts 
     to conclude a sale with the United States buyer consistent 
     with the delivery date and technical requirements of the 
     buyer.
       ``(ii) For purposes of clause (i)(III), there is a 
     rebuttable presumption that the petitioner knew or should 
     have known of the proposed purchase if it is demonstrated 
     that--
       ``(I) the majority of the producers in the industry have 
     made efforts with the United States buyer to conclude a sale 
     of the subject vessel, or
       ``(II) general information on the sale was available from 
     brokers, financiers, classification societies, charterers, 
     trade associations, or other entities normally involved in 
     shipbuilding transactions with whom the petitioner had 
     regular contacts or dealings.
       ``(C) If the petitioner is an interested party described in 
     section 861(17)(D), the petition shall include information 
     indicating that members of the union or group of workers 
     described in that section are employed by a producer that 
     meets the requirements of subparagraph (B) of this paragraph.
       ``(D) If the petitioner is an interested party described in 
     section 861(17)(E), the petition shall include information 
     indicating that a member of the association described in that 
     section is a producer that meets the requirements of 
     subparagraph (B) of this paragraph.
       ``(E) If the petitioner is an interested party described in 
     section 861(17)(F), the petition shall include information 
     indicating that a member of the association described in that 
     section meets the requirements of subparagraph (C) or (D) of 
     this paragraph.
       ``(F) 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) Deadline for filing petition.--
       ``(A) Deadline.--(i) A petitioner to which paragraph (1)(B) 
     (i) or (ii) applies shall file the petition no later than the 
     earlier of--
       ``(I) 6 months after the time that the petitioner first 
     knew or should have known of the sale of the subject vessel, 
     or
       ``(II) 6 months after delivery of the subject vessel.
       ``(ii) A petitioner to which paragraph (1)(B)(iii) applies 
     shall--
       ``(I) file the petition no later than the earlier of 9 
     months after the time that the petitioner first knew or 
     should have known of the sale of the subject vessel, or 6 
     months after delivery of the subject vessel, and
       ``(II) submit to the administering authority a notice of 
     intent to file a petition no later than 6 months after the 
     time that the petitioner first knew or should have known of 
     the sale (unless the petition itself is filed within that 6-
     month period).
       ``(B) Presumption of knowledge.--For purposes of this 
     paragraph, if the existence of the sale, together with 
     general information concerning the vessel, is published in 
     the international trade press, there is a rebuttable 
     presumption that the petitioner knew or should have known of 
     the sale of the vessel from the date of that publication.
       ``(c) Actions Before Initiating Investigations.--
       ``(1) Notification of governments.--Before initiating an 
     investigation under either subsection (a) or (b), the 
     administering authority shall notify the government of the 
     exporting country of the investigation. In the case of the 
     initiation of an investigation under subsection (b), such 
     notification shall include a public version of the petition.
       ``(2) 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 861(17)(C), (D), (E), or (F) before the 
     administering authority makes its decision whether to 
     initiate an investigation pursuant to a petition, except for 
     inquiries regarding

[[Page H6303]]

     the status of the administering authority's consideration of 
     the petition or a request for consultation by the government 
     of the exporting country.
       ``(3) Nondisclosure of certain information.--The 
     administering authority and the Commission shall not disclose 
     information with regard to any draft petition submitted for 
     review and comment before it is filed under subsection 
     (b)(1).
       ``(d) Petition Determination.--
        ``(1) Time for initial determination.--(A) Within 45 days 
     after the date on which a petition is filed under subsection 
     (b), the administering authority shall, 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--
       ``(i) alleges the elements necessary for the imposition of 
     an injurious pricing charge under section 801(a) and the 
     elements required under subsection (b)(1)(B), (C), (D), or 
     (E), 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) Any period in which paragraph (6)(A) applies shall 
     not be included in calculating the 45-day period described in 
     subparagraph (A).
       ``(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 vessel was sold at 
     less than fair value, unless paragraph (6) applies.
       ``(3) Negative determinations.--If--
       ``(A) the determination under clause (i) or (ii) of 
     paragraph (1)(A) is negative, or
       ``(B) paragraph (6)(B) applies,

     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 domestic industry, if--
       ``(i) the domestic producers or workers who support the 
     petition collectively account for at least 25 percent of the 
     total capacity of domestic producers capable of producing a 
     like vessel, and
       ``(ii) the domestic producers or workers who support the 
     petition collectively account for more than 50 percent of the 
     total capacity to produce a like vessel of that portion of 
     the domestic industry expressing support for or opposition to 
     the petition.
       ``(B) Certain positions disregarded.--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 the 
     foreign producer or United States buyer of the subject 
     vessel, or the domestic producer is itself the United States 
     buyer, unless such domestic producers demonstrate that their 
     interests as domestic producers would be adversely affected 
     by the imposition of an injurious pricing charge.
       ``(C) Polling the industry.--If the petition does not 
     establish support of domestic producers or workers accounting 
     for more than 50 percent of the total capacity to produce a 
     like vessel--
       ``(i) the administering authority shall 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.
       ``(D) 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 861(17) 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 interested parties as defined in section 
     861(17)(C), (D), (E), or (F).
       ``(6) Proceedings by wto members.--The administering 
     authority shall not initiate an investigation under this 
     section if, with respect to the vessel sale at issue, an 
     antidumping proceeding conducted by a WTO member who is not a 
     Shipbuilding Agreement Party--
       ``(A) has been initiated and has been pending for not more 
     than one year, or
       ``(B) has been completed and resulted in the imposition of 
     antidumping measures or a negative determination with respect 
     to whether the sale was at less than fair value or with 
     respect to injury.
       ``(e) Notification to Commission of Determination.--The 
     administering authority shall--
       ``(1) notify the Commission immediately of any 
     determination it makes under subsection (a) or (d), 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.

     ``SEC. 803. 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 
     802(d)(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 or has been materially injured, or
       ``(ii) is threatened with material injury, or
       ``(B) the establishment of an industry in the United States 
     is or has been materially retarded,

     by reason of the sale of the subject vessel. If the 
     Commission 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) 
     within 90 days after the date on which the petition is filed 
     or, in the case of an investigation initiated under section 
     802(a), within 90 days after the date on which the Commission 
     receives notice from the administering authority that the 
     investigation has been initiated.
       ``(b) Preliminary Determination by Administering 
     Authority.--
       ``(1) Period of injurious pricing investigation.--(A) 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 subject vessel was sold at less 
     than fair value.
       ``(B) If cost data is required to determine normal value on 
     the basis of a sale of a foreign like vessel that has not 
     been delivered on or before the date on which the 
     administering authority initiates the investigation, the 
     administering authority shall make its determination within 
     160 days after the date of delivery of the foreign like 
     vessel.
       ``(C) If normal value is to be determined on the basis of 
     constructed value, the administering authority shall make its 
     determination within 160 days after the date of delivery of 
     the subject vessel.
       ``(D) In cases in which subparagraph (B) or (C) does not 
     apply, the administering authority shall make its 
     determination within 160 days after the date on which the 
     administering authority initiates the investigation under 
     section 802.
       ``(E) In no event shall the administering authority make 
     its determination before an affirmative determination is made 
     by the Commission under subsection (a).
       ``(2) De minimis injurious pricing margin.--In making a 
     determination under this subsection, the administering 
     authority shall disregard any injurious pricing margin that 
     is de minimis. For purposes of the preceding sentence, an 
     injurious pricing margin is de minimis if the administering 
     authority determines that the margin is less than 2 percent 
     of the export price.
       ``(c) Extension of Period in Extraordinarily Complicated 
     Cases or for Good Cause.--
       ``(1) In general.--If--
       ``(A) the administering authority concludes that the 
     parties concerned are cooperating and determines that--
       ``(i) the case is extraordinarily complicated by reason 
     of--

       ``(I) the novelty of the issues presented, or

       ``(II) the nature and extent of the information required, 
     and

       ``(ii) additional time is necessary to make the preliminary 
     determination, or
       ``(B) a party to the investigation requests an extension 
     and demonstrates good cause for the extension,

     then the administering authority may postpone the time for 
     making its preliminary determination.
       ``(2) Length of postponement.--The preliminary 
     determination may be postponed under paragraph (1)(A) or (B) 
     until not later than the 190th day after--
       ``(A) the date of delivery of the foreign like vessel, if 
     subsection (b)(1)(B) applies,
       ``(B) the date of delivery of the subject vessel, if 
     subsection (b)(1)(C) applies, or
       ``(C) the date on which the administering authority 
     initiates an investigation under section 802, in a case in 
     which subsection (b)(1)(D) applies.
       ``(3) 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 shall--
       ``(1) determine an estimated injurious pricing margin, and
       ``(2) 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.
       ``(e) 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

[[Page H6304]]

     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. 804. TERMINATION OR SUSPENSION OF INVESTIGATION.

       ``(a) Termination of Investigation Upon Withdrawal of 
     Petition.--
       ``(1) In general.--Except as provided in paragraph (2), 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.
       ``(2) 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 803(b).
       ``(b) Termination of Investigations Initiated by 
     Administering Authority.--The administering authority may 
     terminate any investigation initiated by the administering 
     authority under section 802(a) after providing notice of such 
     termination to all parties to the investigation.
       ``(c) Alternate Equivalent Remedy.--The criteria set forth 
     in subparagraphs (A) through (D) of section 806(e)(1) shall 
     apply to any agreement that forms the basis for termination 
     of an investigation under subsection (a) or (b).
       ``(d) Proceedings by WTO Members.--
       ``(1) Suspension of investigation.--The administering 
     authority and the Commission shall suspend an investigation 
     under this section if a WTO member that is not a Shipbuilding 
     Agreement Party initiates an antidumping proceeding described 
     in section 861(29)(A) with respect to the sale of the subject 
     vessel.
       ``(2) Termination of investigation.--If an antidumping 
     proceeding described in paragraph (1) is concluded by--
       ``(A) the imposition of antidumping measures, or
       ``(B) a negative determination with respect to whether the 
     sale is at less than fair value or with respect to injury,

     the administering authority and the Commission shall 
     terminate the investigation under this section.
       ``(3) Continuation of investigation.--(A) If such a 
     proceeding--
       ``(i) is concluded by a result other than a result 
     described in paragraph (2), or
       ``(ii) is not concluded within one year from the date of 
     the initiation of the proceeding,

     then the administering authority and the Commission shall 
     terminate the suspension and continue the investigation. The 
     period in which the investigation was suspended shall not be 
     included in calculating deadlines applicable with respect to 
     the investigation.
       ``(B) Notwithstanding subparagraph (A)(ii), if the 
     proceeding is concluded by a result described in paragraph 
     (2)(A), the administering authority and the Commission shall 
     terminate the investigation under this section.

     ``SEC. 805. FINAL DETERMINATIONS.

       ``(a) Determinations by Administering Authority.--
       ``(1) In general.--Within 75 days after the date of its 
     preliminary determination under section 803(b), the 
     administering authority shall make a final determination of 
     whether the vessel which is the subject of the investigation 
     has been sold in the United States at less than its fair 
     value.
       ``(2) Extension of period for determination.--(A) The 
     administering authority may postpone making the final 
     determination under paragraph (1) until not later than 290 
     days after--
       ``(i) the date of delivery of the foreign like vessel, in 
     an investigation to which section 803(b)(1)(B) applies,
       ``(ii) the date of delivery of the subject vessel, in an 
     investigation to which section 803(b)(1)(C) applies, or
       ``(iii) the date on which the administering authority 
     initiates the investigation under section 802, in an 
     investigation to which section 803(b)(1)(D) applies.
       ``(B) The administering authority may apply subparagraph 
     (A) if a request in writing is made by--
       ``(i) the producer of the subject vessel, in a proceeding 
     in which the preliminary determination by the administering 
     authority under section 803(b) was affirmative, or
       ``(ii) the petitioner, in a proceeding in which the 
     preliminary determination by the administering authority 
     under section 803(b) was negative.
       ``(3) De minimis injurious pricing margin.--In making a 
     determination under this subsection, the administering 
     authority shall disregard any injurious pricing margin that 
     is de minimis as defined in section 803(b)(2).
       ``(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 or has been materially injured, or
       ``(ii) is threatened with material injury, or
       ``(B) the establishment of an industry in the United States 
     is or has been materially retarded,

     by reason of the sale of the vessel with respect to which the 
     administering authority has made an affirmative determination 
     under subsection (a)(1).
       ``(2) Period for injury determination following affirmative 
     preliminary determination by administering authority.--If the 
     preliminary determination by the administering authority 
     under section 803(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 803(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 803(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.
       ``(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 the administering authority shall--
       ``(A) 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, and
       ``(B) calculate an injurious pricing charge in an amount 
     equal to the amount by which the normal value exceeds the 
     export price of the subject vessel.
       ``(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 injurious pricing order under section 806. If 
     either of such determinations is negative, the investigation 
     shall be terminated upon the publication of notice of that 
     negative determination.
       ``(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. 806. IMPOSITION AND COLLECTION OF INJURIOUS PRICING 
                   CHARGE.

       ``(a) In General.--Within 10 days after being notified by 
     the Commission of an affirmative determination under section 
     805(b), the administering authority shall publish an order 
     imposing an injurious pricing charge on the foreign producer 
     of the subject vessel which--
       ``(1) directs the foreign producer of the subject vessel to 
     pay to the Secretary of the Treasury, or the designee of the 
     Secretary, within 180 days from the date of publication of 
     the order, an injurious pricing charge in an amount equal to 
     the amount by which the normal value exceeds the export price 
     of the subject vessel,
       ``(2) includes the identity and location of the foreign 
     producer and a description of the subject vessel, in such 
     detail as the administering authority deems necessary, and
       ``(3) informs the foreign producer that--
       ``(A) failure to pay the injurious pricing charge in a 
     timely fashion may result in the imposition of 
     countermeasures with respect to that producer under section 
     807,
       ``(B) payment made after the deadline described in 
     paragraph (1) shall be subject to interest charges at the 
     Commercial Interest Reference Rate (CIRR), and
       ``(C) the foreign producer may request an extension of the 
     due date for payment under subsection (b).
       ``(b) Extension of Due Date for Payment in Extraordinary 
     Circumstances.--
       ``(1) Extension.--Upon request, the administering authority 
     may amend the order under subsection (a) to set a due date 
     for payment or payments later than the date that is 180 days 
     from the date of publication of the order, if the 
     administering authority determines that full payment in 180 
     days would render the producer insolvent or would be 
     incompatible with a judicially supervised reorganization. 
     When an extended payment schedule provides for a series of 
     partial payments, the administering authority shall specify 
     the circumstances under which default on one or more payments 
     will result in the imposition of countermeasures.
       ``(2) Interest charges.--If a request is granted under 
     paragraph (1), payments made after the date that is 180 days 
     from the publication of the order shall be subject to 
     interest charges at the CIRR.
       ``(c) Notification of Order.--The administering authority 
     shall deliver a copy of the order requesting payment to the 
     foreign producer of the subject vessel and to an appropriate 
     representative of the government of the exporting country.
       ``(d) Revocation of Order.--The administering authority--
       ``(1) may revoke an injurious pricing order if the 
     administering authority determines that producers accounting 
     for substantially all of the

[[Page H6305]]

     capacity to produce a domestic like vessel have expressed a 
     lack of interest in the order, and
       ``(2) shall revoke an injurious pricing order--
       ``(A) if the sale of the vessel that was the subject of the 
     injurious pricing determination is voided,
       ``(B) if the injurious pricing charge is paid in full, 
     including any interest accrued for late payment,
       ``(C) upon full implementation of an alternative equivalent 
     remedy described in subsection (e), or
       ``(D) if, with respect to the vessel sale that was at issue 
     in the investigation that resulted in the injurious pricing 
     order, an antidumping proceeding conducted by a WTO member 
     who is not a Shipbuilding Agreement Party has been completed 
     and resulted in the imposition of antidumping measures.
       ``(e) Alternative Equivalent Remedy.--
       ``(1) Agreement for alternate remedy.--The administering 
     authority may suspend an injurious pricing order if the 
     administering authority enters into an agreement with the 
     foreign producer subject to the order on an alternative 
     equivalent remedy, that the administering authority 
     determines--
       ``(A) is at least as effective a remedy as the injurious 
     pricing charge,
       ``(B) is in the public interest,
       ``(C) can be effectively monitored and enforced, and
       ``(D) is otherwise consistent with the domestic law and 
     international obligations of the United States.
       ``(2) Prior consultations and submission of comments.--
     Before entering into an agreement under paragraph (1), the 
     administering authority shall consult with the industry, and 
     provide for the submission of comments by interested parties, 
     with respect to the agreement.
       ``(3) Material violations of agreement.--If the injurious 
     pricing order has been suspended under paragraph (1), and the 
     administering authority determines that the foreign producer 
     concerned has materially violated the terms of the agreement 
     under paragraph (1), the administering authority shall 
     terminate the suspension.

     ``SEC. 807. IMPOSITION OF COUNTERMEASURES.

       ``(a) General Rule.--
       ``(1) Issuance of order imposing countermeasures.--Unless 
     an injurious pricing order is revoked or suspended under 
     section 806 (d) or (e), the administering authority shall 
     issue an order imposing countermeasures.
       ``(2) Contents of order.--The countermeasure order shall--
       ``(A) state that, as provided in section 468, a permit to 
     lade or unlade passengers or merchandise may not be issued 
     with respect to vessels contracted to be built by the foreign 
     producer of the vessel with respect to which an injurious 
     pricing order was issued under section 806, and
       ``(B) specify the scope and duration of the prohibition on 
     the issuance of a permit to lade or unlade passengers or 
     merchandise.
       ``(b) Notice of Intent To Impose Countermeasures.--
       ``(1) General rule.--The administering authority shall 
     issue a notice of intent to impose countermeasures not later 
     than 30 days before the expiration of the time for payment 
     specified in the injurious pricing order (or extended payment 
     provided for under section 806(b)), and shall publish the 
     notice in the Federal Register within 7 days after issuing 
     the notice.
       ``(2) Elements of the notice of intent.--The notice of 
     intent shall contain at least the following elements:
       ``(A) Scope.--A permit to lade or unlade passengers or 
     merchandise may not be issued with respect to any vessel--
       ``(i) built by the foreign producer subject to the proposed 
     countermeasures, and
       ``(ii) with respect to which the material terms of sale are 
     established within a period of 4 consecutive years beginning 
     on the date that is 30 days after publication in the Fedeal 
     Register of the notice of intent described in paragraph (1).
       ``(B) Duration.--For each vessel described in subparagraph 
     (A), a permit to lade or unlade passengers or merchandise may 
     not be issued for a period of 4 years after the date of 
     delivery of the vessel.
       ``(c) Determination To Impose Countermeasures; Order.--
       ``(1) General rule.--The administering authority shall, 
     within the time specified in paragraph (2), issue a 
     determination and order imposing countermeasures.
       ``(2) Time for determination.--The determination shall be 
     issued within 90 days after the date on which the notice of 
     intent to impose countermeasures under subsection (b) is 
     published in the Federal Register. The administering 
     authority shall publish the determination, and the order 
     described in paragraph (4), in the Federal Register within 7 
     days after issuing the final determination, and shall provide 
     a copy of the determination and order to the Customs Service.
       ``(3) Content of the determination.--In the determination 
     imposing countermeasures, the administering authority shall 
     determine whether, in light of all of the circumstances, an 
     interested party has demonstrated that the scope or duration 
     of the countermeasures described in subsection (b)(2) should 
     be narrower or shorter than the scope or duration set forth 
     in the notice of intent to impose countermeasures.
       ``(4) Order.--At the same time it issues its determination, 
     the administering authority shall issue an order imposing 
     countermeasures, consistent with its determination.
       ``(d) Administrative Review of Determination To Impose 
     Countermeasures.--
       ``(1) Request for review.--Each year, in the anniversary 
     month of the issuance of the order imposing countermeasures 
     under subsection (c), the administering authority shall 
     publish in the Federal Register a notice providing that 
     interested parties may request--
       ``(A) a review of the scope or duration of the 
     countermeasures determined under subsection (c)(3), and
       ``(B) a hearing in connection with such a review.
       ``(2) Review.--If a proper request has been received under 
     paragraph (1), the administering authority shall--
       ``(A) publish notice of initiation of a review in the 
     Federal Register not later than 15 days after the end of the 
     anniversary month of the issuance of the order imposing 
     countermeasures, and
       ``(B) review and determine whether the requesting party has 
     demonstrated that the scope or duration of the 
     countermeasures is excessive in light of all of the 
     circumstances.
       ``(3) Time for review.--The administering authority shall 
     make its determination under paragraph (2)(B) within 90 days 
     after the date on which the notice of initiation of the 
     review is published. If the determination under paragraph 
     (2)(B) is affirmative, the administering authority shall 
     amend the order accordingly. The administering authority 
     shall promptly publish the determination and any amendment to 
     the order in the Federal Register, and shall provide a copy 
     of any amended order to the Customs Service. In extraordinary 
     circumstances, the administering authority may extend the 
     time for its determination under paragraph (2)(B) to not 
     later than 150 days after the date on which the notice of 
     initiation of the review is published.
       ``(e) Extension of Countermeasures.--
       ``(1) Request for extension.--Within the time described in 
     paragraph (2), an interested party may file with the 
     administering authority a request that the scope or duration 
     of countermeasures be extended.
       ``(2) Deadline for request for extension.--
       ``(A) Request for extension beyond 4 years.--If the request 
     seeks an extension that would cause the scope or duration of 
     countermeasures to exceed 4 years, including any prior 
     extensions, the request for extension under paragraph (1) 
     shall be filed not earlier than the date that is 15 months, 
     and not later than the date that is 12 months, before the 
     date that marks the end of the period that specifies the 
     vessels that fall within the scope of the order by virtue of 
     the establishment of material terms of sale within that 
     period.
       ``(B) Other requests.--If the request seeks an extension 
     under paragraph (1) other than one described in subparagraph 
     (A), the request shall be filed not earlier than the date 
     that is 6 months, and not later than a date that is 3 months, 
     before the date that marks the end of the period referred to 
     in subparagraph (A).
       ``(3) Determination.--
       ``(A) Notice of request for extension.--If a proper request 
     has been received under paragraph (1), the administering 
     authority shall publish notice of initiation of an extension 
     proceeding in the Federal Register not later than 15 days 
     after the applicable deadline in paragraph (2) for requesting 
     the extension.
       ``(B) Procedures.--
       ``(i) Requests for extension beyond 4 years.--If paragraph 
     (2)(A) applies to the request, the administering authority 
     shall consult with the Trade Representative under paragraph 
     (4).
       ``(ii) Other requests.--If paragraph (2)(B) applies to the 
     request, the administering authority shall determine, within 
     90 days after the date on which the notice of initiation of 
     the proceeding is published, whether the requesting party has 
     demonstrated that the scope or duration of the 
     countermeasures is inadequate in light of all of the 
     circumstances. If the administering authority determines that 
     an extension is warranted, it shall amend the countermeasure 
     order accordingly. The administering authority shall promptly 
     publish the determination and any amendment to the order in 
     the Federal Register, and shall provide a copy of any amended 
     order to the Customs Service.
       ``(4) Consultation with trade representative.--If paragraph 
     (3)(B)(i) applies, the administering authority shall consult 
     with the Trade Representative concerning whether it would be 
     appropriate to request establishment of a dispute settlement 
     panel under the Shipbuilding Agreement for the purpose of 
     seeking authorization to extend the scope or duration of 
     countermeasures for a period in excess of 4 years.
       ``(5) Decision not to request panel.--If, based on 
     consultations under paragraph (4), the Trade Representative 
     decides not to request establishment of a panel, the Trade 
     Representative shall inform the party requesting the 
     extension of the countermeasures of the reasons for its 
     decision in writing. The decision shall not be subject to 
     judicial review.
       ``(6) Panel proceedings.--If, based on consultations under 
     paragraph (4), the Trade Representative requests the 
     establishment of a panel under the Shipbuilding Agreement to 
     authorize an extension of the period of countermeasures, and 
     the panel authorizes such an extension, the administering 
     authority shall promptly amend the countermeasure order. The 
     administering authority shall publish notice of the amendment 
     in the Federal Register.
       ``(f) List of Vessels Subject to Countermeasures.--
       ``(1) General rule.--At least once during each 12-month 
     period beginning on the anniversary date of a determination 
     to impose countermeasures under this section, the 
     administering authority shall publish in the Federal Register 
     a list of all delivered vessels subject to countermeasures 
     under the determination.
       ``(2) Content of list.--The list under paragraph (1) shall 
     include the following information for each vessel, to the 
     extent the information is available:
       ``(A) The name and general description of the vessel.

[[Page H6306]]

       ``(B) The vessel identification number.
       ``(C) The shipyard where the vessel was constructed.
       ``(D) The last-known registry of the vessel.
       ``(E) The name and address of the last-known owner of the 
     vessel.
       ``(F) The delivery date of the vessel.
       ``(G) The remaining duration of countermeasures on the 
     vessel.
       ``(H) Any other identifying information available.
       ``(3) Amendment of list.---The administering authority may 
     amend the list from time to time to reflect new information 
     that comes to its attention and shall publish any amendments 
     in the Federal Register.
       ``(4) Service of list and amendments.--(A) The 
     administering authority shall serve a copy of the list 
     described in paragraph (1) on--
       ``(i) the petitioner under section 802(b),
       ``(ii) the United States Customs Service,
       ``(iii) the Secretariat of the Organization for Economic 
     Cooperation and Development,
       ``(iv) the owners of vessels on the list,
       ``(v) the shipyards on the list, and
       ``(vi) the government of the country in which a shipyard on 
     the list is located.
       ``(B) The administering authority shall serve a copy of any 
     amendments to the list under paragraph (3) or subsection 
     (g)(3) on--
       ``(i) the parties listed in clauses (i), (ii), and (iii) of 
     subparagraph (A), and,
       ``(ii) if the amendment affects their interests, the 
     parties listed in clauses (iv), (v), and (vi) of subparagraph 
     (A).
       ``(g) Administrative Review of List of Vessels Subject to 
     Countermeasures.--
       ``(1) Request for review.--(A) An interested party may 
     request in writing a review of the list described in 
     subsection (f)(1), including any amendments thereto, to 
     determine whether--
       ``(i) a vessel included in the list does not fall within 
     the scope of the applicable countermeasure order and should 
     be deleted, or
       ``(ii) a vessel not included in the list falls within the 
     scope of the applicable countermeasure order and should be 
     added.
       ``(B) Any request seeking a determination described in 
     subparagraph (A)(i) shall be made within 90 days after the 
     date of publication of the applicable list.
       ``(2) Review.--If a proper request for review has been 
     received, the administering authority shall--
       ``(A) publish notice of initiation of a review in the 
     Federal Register--
       ``(i) not later than 15 days after the request is received, 
     or
       ``(ii) if the request seeks a determination described in 
     paragraph (1)(A)(i), not later than 15 days after the 
     deadline described in paragraph (1)(B), and
       ``(B) review and determine whether the requesting party has 
     demonstrated that--
       ``(i) a vessel included in the list does not qualify for 
     such inclusion, or
       ``(ii) a vessel not included in the list qualifies for 
     inclusion.
       ``(3) Time for determination.--The administering authority 
     shall make its determination under paragraph (2)(B) within 90 
     days after the date on which the notice of initiation of such 
     review is published. If the administering authority 
     determines that a vessel should be added or deleted from the 
     list, the administering authority shall amend the list 
     accordingly. The administering authority shall promptly 
     publish in the Federal Register the determination and any 
     such amendment to the list.
       ``(h) Expiration of Countermeasures.--Upon expiration of a 
     countermeasure order imposed under this section, the 
     administering authority shall promptly publish a notice of 
     the expiration in the Federal Register.
       ``(i) Suspension or Termination of Proceedings or 
     Countermeasures; Temporary Reduction of Countermeasures.--
       ``(1) If injurious pricing order revoked or suspended.--If 
     an injurious pricing order has been revoked or suspended 
     under section 806(d) or (e), the administering authority 
     shall, as appropriate, suspend or terminate proceedings under 
     this section with respect to that order, or suspend or revoke 
     a countermeasure order issued with respect to that injurious 
     pricing order.
       ``(2) If payment date amended.--(A) Subject to subparagraph 
     (C), if the payment date under an injurious pricing order is 
     amended under section 845, the administering authority shall, 
     as appropriate, suspend proceedings or modify deadlines under 
     this section, or suspend or amend a countermeasure order 
     issued with respect to that injurious pricing order.
       ``(B) In taking action under subparagraph (A), the 
     administering authority shall ensure that countermeasures are 
     not applied before the date that is 30 days after publication 
     in the Federal Register of the amended payment date.
       ``(C) If--
       ``(i) a countermeasure order is issued under subsection (c) 
     before an amendment is made under section 845 to the payment 
     date of the injurious pricing order to which the 
     countermeasure order applies, and
       ``(ii) the administering authority determines that the 
     period of time between the original payment date and the 
     amended payment date is significant for purposes of 
     determining the appropriate scope or duration of 
     countermeasures,

     the administering authority may, in lieu of acting under 
     subparagraph (A), reinstitute proceedings under subsection 
     (c) for purposes of issuing a new determination under that 
     subsection.
       ``(j) Comment and Hearing.--In the course of any proceeding 
     under subsection (c), (d), (e), or (g), the administering 
     authority--
       ``(1) shall solicit comments from interested parties, and
       ``(2)(A) in a proceeding under subsection (c) or (d), upon 
     the request of an interested party, shall hold a hearing in 
     accordance with section 841(b) in connection with that 
     proceeding, or
       ``(B) in a proceeding under subsection (e) or (g), upon the 
     request of an interested party, may hold a hearing in 
     accordance with section 841(b) in connection with that 
     proceeding.

     ``SEC. 808. INJURIOUS PRICING PETITIONS BY THIRD COUNTRIES.

       ``(a) Filing of Petition.--The government of a Shipbuilding 
     Agreement Party may file with the Trade Representative a 
     petition requesting that an investigation be conducted to 
     determine if--
       ``(1) a vessel from another Shipbuilding Agreement Party 
     has been sold in the United States at less than fair value, 
     and
       ``(2) an industry, in the petitioning country, producing or 
     capable of producing a like vessel is materially injured by 
     reason of such sale.
       ``(b) Initiation.--The Trade Representative, after 
     consultation with the administering authority and the 
     Commission and obtaining the approval of the Parties Group 
     under the Shipbuilding Agreement, shall determine whether to 
     initiate an investigation described in subsection (a).
       ``(c) Determinations.--Upon initiation of an investigation 
     under subsection (a), the Trade Representative shall request 
     the following determinations be made in accordance with 
     substantive and procedural requirements specified by the 
     Trade Representative, notwithstanding any other provision of 
     this title:
       ``(1) The administering authority shall determine whether 
     the subject vessel has been sold at less than fair value.
       ``(2) The Commission shall determine whether an industry in 
     the petitioning country is materially injured by reason of 
     the sale of the subject vessel in the United States.
       ``(d) Public Comment.--An opportunity for public comment 
     shall be provided, as appropriate--
       ``(1) by the Trade Representative, in making the 
     determinations required by subsection (b), and
       ``(2) by the administering authority and the Commission, in 
     making the determinations 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--
       ``(1) order an injurious pricing charge in accordance with 
     section 806, and
       ``(2) make such determinations and take such other actions 
     as are required by sections 806 and 807, as if affirmative 
     determinations had been made under subsections (a) and (b) of 
     section 805.
       ``(f) Reviews of Determinations.--For purposes of review 
     under section 516B, if an order is issued under subsection 
     (e)--
       ``(1) the final determinations of the administering 
     authority and the Commission under subsection (c) shall be 
     treated as final determinations made under section 805, and
       ``(2) determinations of the administering authority under 
     subsection (e)(2) shall be treated as determinations made 
     under section 806 or 807, as the case may be.
       ``(g) Access to Information.--Section 843 shall apply to 
     investigations under this section, to the extent specified by 
     the Trade Representative, after consultation with the 
     administering authority and the Commission.
                      ``Subtitle B--Special Rules

     ``SEC. 821. EXPORT PRICE.

       ``(a) Export Price.--For purposes of this title, the term 
     `export price' means the price at which the subject vessel is 
     first sold (or agreed to be sold) by or for the account of 
     the foreign producer of the subject vessel to an unaffiliated 
     United States buyer. The term `sold (or agreed to be sold) by 
     or for the account of the foreign producer' includes any 
     transfer of an ownership interest, including by way of lease 
     or long-term bareboat charter, in conjunction with the 
     original transfer from the producer, either directly or 
     indirectly, to a United States buyer.
       ``(b) Adjustments to Export Price.--The price used to 
     establish export price shall be--
       ``(1) increased by 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 vessel, and
       ``(2) reduced by--
       ``(A) the amount, if any, included in such price, 
     attributable to any additional costs, charges, or expenses 
     which are incident to bringing the subject vessel from the 
     shipyard in the exporting country to the place of delivery,
       ``(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 vessel, and
       ``(C) all other expenses incidental to placing the vessel 
     in condition for delivery to the buyer.

     ``SEC. 822. NORMAL VALUE.

       ``(a) Determination.--In determining under this title 
     whether a subject vessel has been sold at less than fair 
     value, a fair comparison shall be made between the export 
     price and normal value of the subject vessel. In order to 
     achieve a fair comparison with the export price, normal value 
     shall be determined as follows:
       ``(1) Determination of normal value.--
       ``(A) In general.--The normal value of the subject vessel 
     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 under section 821(a).
       ``(B) Price.--The price referred to in subparagraph (A) 
     is--
       ``(i) the price at which a foreign like vessel is first 
     sold in the exporting country, in the ordinary course of 
     trade and, to the extent practicable, at the same level of 
     trade, or
       ``(ii) in a case to which subparagraph (C) applies, the 
     price at which a foreign like vessel is

[[Page H6307]]

     so sold for consumption in a country other than the exporting 
     country or the United States, if--

       ``(I) such price is representative, and
       ``(II) the administering authority does not determine that 
     the particular market situation in such other country 
     prevents a proper comparison with the export price.

       ``(C) Third country sales.--This subparagraph applies 
     when--
       ``(i) a foreign like vessel is not sold in the exporting 
     country as described in subparagraph (B)(i), or
       ``(ii) the particular market situation in the exporting 
     country does not permit a proper comparison with the export 
     price.
       ``(D) Contemporaneous sale.--For purposes of subparagraph 
     (A), `a time reasonably corresponding to the time of the 
     sale' means within 3 months before or after the sale of the 
     subject vessel or, in the absence of such sales, such longer 
     period as the administering authority determines would be 
     appropriate.
       ``(2) Fictitious markets.--No pretended sale, and no sale 
     intended to establish a fictitious market, shall be taken 
     into account in determining normal value.
       ``(3) Use of constructed value.--If the administering 
     authority determines that the normal value of the subject 
     vessel cannot be determined under paragraph (1)(B) or (1)(C), 
     then the normal value of the subject vessel shall be the 
     constructed value of that vessel, as determined under 
     subsection (e).
       ``(4) Indirect sales.--If a foreign like vessel is sold 
     through an affiliated party, the price at which the foreign 
     like vessel is sold by such affiliated party may be used in 
     determining normal value.
       ``(5) Adjustments.--The price described in paragraph (1)(B) 
     shall be--
       ``(A) reduced by--
       ``(i) the amount, if any, included in the price described 
     in paragraph (1)(B), attributable to any costs, charges, and 
     expenses incident to bringing the foreign like vessel from 
     the shipyard to the place of delivery to the purchaser,
       ``(ii) the amount of any taxes imposed directly upon the 
     foreign like vessel or components thereof which have been 
     rebated, or which have not been collected, on the subject 
     vessel, but only to the extent that such taxes are added to 
     or included in the price of the foreign like vessel, and
       ``(iii) the amount of all other expenses incidental to 
     placing the foreign like vessel in condition for delivery to 
     the buyer, and
       ``(B) increased or decreased by the amount of any 
     difference (or lack thereof) between the 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) physical differences between the subject vessel and 
     the vessel used in determining normal value, or
       ``(ii) other differences in the circumstances of sale.
       ``(6) Adjustments for 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 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 and normal value, if the difference in level of 
     trade--
       ``(A) involves the performance of different selling 
     activities, and
       ``(B) 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.
       ``(7) Adjustments to constructed value.--Constructed value 
     as determined under subsection (d) 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 the sale of the foreign like vessel under 
     consideration for the determination of normal value has been 
     made at a price which represents less than the cost of 
     production of the foreign like vessel, the administering 
     authority shall determine whether, in fact, such sale was 
     made at less than the cost of production. If the 
     administering authority determines that the sale was made at 
     less than the cost of production and was not at a price which 
     permits recovery of all costs within 5 years, such sale may 
     be disregarded in the determination of normal value. Whenever 
     such a sale is disregarded, normal value shall be based on 
     another sale of a foreign like vessel 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 subject vessel.
       ``(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 the sale of a 
     foreign like vessel was made at a price that is less than the 
     cost of production of the vessel, if an interested party 
     described in subparagraph (C), (D), (E), or (F) of section 
     861(17) provides information, based upon observed prices or 
     constructed prices or costs, that the sale of the foreign 
     like vessel under consideration for the determination of 
     normal value has been made at a price which represents less 
     than the cost of production of the vessel.
       ``(B) Recovery of costs.--If the price is below the cost of 
     production at the time of sale but is above the weighted 
     average cost of production for the period of investigation, 
     such price shall be considered to provide for recovery of 
     costs within 5 years.
       ``(3) Calculation of cost of production.--For purposes of 
     this section, 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 
     vessel, during a period which would ordinarily permit the 
     production of that vessel in the ordinary course of business, 
     and
       ``(B) an amount for selling, general, and administrative 
     expenses based on actual data pertaining to the production 
     and sale of the foreign like vessel by the producer in 
     question.

     For purposes of subparagraph (A), if the normal value is 
     based on the price of the foreign like vessel sold 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 on 
     their disposition which are remitted or refunded upon 
     exportation.
       ``(c) Nonmarket Economy Countries.--
       ``(1) In general.--If--
       ``(A) the subject vessel is produced in a nonmarket economy 
     country, and
       ``(B) the administering authority finds that available 
     information does not permit the normal value of the subject 
     vessel to be determined under subsection (a),

     the administering authority shall determine the normal value 
     of the subject vessel on the basis of the value of the 
     factors of production utilized in producing the vessel and to 
     which shall be added an amount for general expenses and 
     profit plus the cost of expenses incidental to placing the 
     vessel in a condition for delivery to the buyer. 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 the subject vessel under 
     paragraph (1), the administering authority shall determine 
     the normal value on the basis of the price at which a vessel 
     that is--
       ``(A) comparable to the subject vessel, 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 the 
     vessel 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 vessels.
       ``(d) Special Rule for Certain Multinational 
     Corporations.--Whenever, in the course of an investigation 
     under this title, the administering authority determines 
     that--
       ``(1) the subject vessel was 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 a foreign 
     like vessel which are located in another country or 
     countries,
       ``(2) subsection (a)(1)(C) applies, and
       ``(3) the normal value of a foreign like vessel produced in 
     one or more of the facilities outside the exporting country 
     is higher than the normal value of the foreign like vessel 
     produced in the facilities located in the exporting country,

     the administering authority shall determine the normal value 
     of the subject vessel by reference to the normal value at 
     which a foreign like vessel is sold from one or more 
     facilities outside the exporting country. The administering 
     authority, in making any determination under this subsection, 
     shall make adjustments for the difference between the costs 
     of production (including taxes, labor, materials, and 
     overhead) of the foreign like vessel produced in facilities 
     outside the exporting country and costs of production of the 
     foreign like vessel produced in facilities in the exporting 
     country, if such differences are demonstrated to its 
     satisfaction.
       ``(e) Constructed Value.--
       ``(1) In general.--For purposes of this title, the 
     constructed value of a subject vessel shall be an amount 
     equal to the sum of--
       ``(A) the cost of materials and fabrication or other 
     processing of any kind employed in producing the subject 
     vessel, during a period which would ordinarily permit the 
     production of the vessel in the ordinary course of business, 
     and
       ``(B)(i) the actual amounts incurred and realized by the 
     foreign producer of the subject vessel for selling, general, 
     and administrative expenses, and for profits, in connection 
     with the production and sale of a foreign like vessel, in the 
     ordinary course of trade, in the domestic

[[Page H6308]]

     market of the country of origin of the subject vessel, or
       ``(ii) if actual data are not available with respect to the 
     amounts described in clause (i), then--
       ``(I) the actual amounts incurred and realized by the 
     foreign producer of the subject vessel for selling, general, 
     and administrative expenses, and for profits, in connection 
     with the production and sale of the same general category of 
     vessel in the domestic market of the country of origin of the 
     subject vessel,
       ``(II) the weighted average of the actual amounts incurred 
     and realized by producers in the country of origin of the 
     subject vessel (other than the producer of the subject 
     vessel) for selling, general, and administrative expenses, 
     and for profits, in connection with the production and sale 
     of a foreign like vessel, in the ordinary course of trade, in 
     the domestic market, or
       ``(III) if data is not available under subclause (I) or 
     (II), 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 foreign 
     producers (other than the producer of the subject vessel) in 
     connection with the sale of vessels in the same general 
     category of vessel as the subject vessel in the domestic 
     market of the country of origin of the subject vessel.

     The profit shall, for purposes of this paragraph, be based on 
     the average profit realized over a reasonable period of time 
     before and after the sale of the subject vessel and shall 
     reflect a reasonable profit at the time of such sale. For 
     purposes of the preceding sentence, a `reasonable period of 
     time' shall not, except where otherwise appropriate, exceed 6 
     months before, or 6 months after, the sale of the subject 
     vessel. In calculating profit under this paragraph, any 
     distortion which would result in other than a profit which is 
     reasonable at the time of the sale shall be eliminated.
       ``(2) Costs and profits based on other reasonable 
     methods.--When costs and profits are determined under 
     paragraph (1)(B)(ii)(III), such determination shall, except 
     where otherwise appropriate, be based on appropriate export 
     sales by the producer of the subject vessel or, absent such 
     sales, to export sales by other producers of a foreign like 
     vessel or the same general category of vessel as the subject 
     vessel in the country of origin of the subject vessel.
       ``(3) Costs of materials.--For purposes of paragraph 
     (1)(A), 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 vessel 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 foreign producer of the subject vessel, 
     if such records are kept in accordance with the generally 
     accepted accounting principles of the exporting country and 
     reasonably reflect the costs associated with the production 
     and sale of the vessel. The administering authority shall 
     consider all available evidence on proper allocation of 
     costs, including that which is made available by the foreign 
     producer on a timely basis, if such allocations have been 
     historically used by the foreign 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 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 type of vessel 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 vessel 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 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. For purposes of this subparagraph, the 
     startup period ends at the point at which the level of 
     commercial production that is characteristic of the vessel, 
     the producer, or the industry is achieved.
       ``(D) Costs due to extraordinary circumstances not 
     included.--Costs shall not include actual costs which are due 
     to extraordinary circumstances (including, but not limited 
     to, labor disputes, fire, and natural disasters) and which 
     are significantly over the cost increase which the 
     shipbuilder could have reasonably anticipated and taken into 
     account at the time of sale.
       ``(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 a 
     like vessel 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 subject vessel, 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. 823. CURRENCY CONVERSION.

       ``(a) In General.--In an injurious pricing 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 vessel, except 
     that if it is established that a currency transaction on 
     forward markets is directly linked to a sale under 
     consideration, the exchange rate specified with respect to 
     such foreign currency in the forward sale agreement shall be 
     used to convert the foreign currency.
       ``(b) Date of Sale.--For purposes of this section, `date of 
     sale' means the date of the contract of sale or, where 
     appropriate, the date on which the material terms of sale are 
     otherwise established. If the material terms of sale are 
     significantly changed after such date, the date of sale is 
     the date of such change. In the case of such a change in the 
     date of sale, the administering authority shall make 
     appropriate adjustments to take into account any unreasonable 
     effect on the injurious pricing margin due only to 
     fluctuations in the exchange rate between the original date 
     of sale and the new date of sale.
                        ``Subtitle C--Procedures

     ``SEC. 841. HEARINGS.

       ``(a) Upon Request.--The administering authority and the 
     Commission shall each hold a hearing in the course of an 
     investigation under this title, upon the request of any party 
     to the investigation, before making a final determination 
     under section 805.
       ``(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. 842. 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 the submission of the information or in the form and 
     manner requested, subject to subsections (b)(1) and (d) of 
     section 844,
       ``(C) significantly impedes a proceeding under this title, 
     or
       ``(D) provides such information but the information cannot 
     be verified as provided in section 844(g),

     the administering authority and the Commission shall, subject 
     to section 844(c), 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, or
       ``(2) 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 under this title, the administering 
     authority and 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. 843. ACCESS TO INFORMATION.

       ``(a) Information Generally Made Available.--
       ``(1) Progress of investigation reports.--The administering 
     authority and the Commission shall, from time to time upon 
     request, inform the parties to an investigation under this 
     title of the progress of that investigation.
       ``(2) Ex parte meetings.--The administering authority and 
     the Commission shall maintain a record of any ex parte 
     meeting between--

[[Page H6309]]

       ``(A) interested parties or other persons providing factual 
     information in connection with a proceeding under this title, 
     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.
       ``(3) Summaries; non-proprietary submissions.--The 
     administering authority and the Commission shall disclose--
       ``(A) any proprietary information received in the course of 
     a proceeding under this title 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.
       ``(4) Maintenance of public record.--The administering 
     authority and the Commission shall maintain and make 
     available for public inspection and copying a record of all 
     information which is obtained by the administering authority 
     or the Commission, as the case may be, in a proceeding under 
     this title to the extent that public disclosure of the 
     information is not prohibited under this chapter or exempt 
     from disclosure under section 552 of title 5, United States 
     Code.
       ``(b) Proprietary Information.--
       ``(1) Proprietary status maintained.--
       ``(A) In general.--Except as provided in subsection (a)(4) 
     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 other proceeding under this 
     title covering the same subject vessel, 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 nonproprietary 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.
       ``(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 under this title (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 all interested parties 
     who are parties to the proceeding under a protective order 
     described in subparagraph (B), regardless of when the 
     information is submitted during the proceeding. Customer 
     names (other than the name of the United States buyer of the 
     subject vessel) obtained during any investigation which 
     requires a determination under section 805(b) may not be 
     disclosed by the administering authority under protective 
     order until either an order is published under section 806(a) 
     as a result of the investigation or the investigation is 
     suspended or terminated. The Commission may delay disclosure 
     of customer names (other than the name of the United States 
     buyer of the subject vessel) under protective order during 
     any such investigation until a reasonable time before any 
     hearing provided under section 841 is held.
       ``(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 limitations 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 803(a)) after the date 
     on which the information is submitted, or
       ``(ii) if--

       ``(I) the person submitting 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 803(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 or the Commission denies a request for information 
     under paragraph (1), then application may be made to the 
     United States Court of International Trade for an order 
     directing the administering authority or the Commission, as 
     the case may be, 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, except that a nonconfidential summary thereof shall be 
     served upon all other interested parties who are parties to 
     the proceeding.
       ``(e) 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), and such 
     information shall be treated as information described in 
     section 552(b)(3) of title 5, United States Code.
       ``(f) Opportunity for Comment by Vessel Buyers.--The 
     administering authority and the Commission shall provide an 
     opportunity for buyers of subject vessels to submit relevant 
     information to the administering authority concerning a sale 
     at less than fair value or countermeasures, and to the 
     Commission concerning material injury by reason of the sale 
     of a vessel at less than fair value.
       ``(g) Publication of Determinations; Requirements for Final 
     Determinations.--
       ``(1) In general.--Whenever the administering authority 
     makes a determination under section 802 whether to initiate 
     an investigation, or

[[Page H6310]]

     the administering authority or the Commission makes a 
     preliminary determination under section 803, a final 
     determination under section 805, a determination under 
     subsection (b), (c), (d), (e)(3)(B)(ii), (g), or (i) of 
     section 807, or a determination to suspend an investigation 
     under this title, 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 foreign producer and the country of 
     origin of the subject vessel,
       ``(ii) a description sufficient to identify the subject 
     vessel,
       ``(iii) with respect to an injurious pricing charge, the 
     injurious pricing margin established and a full explanation 
     of the methodology used in establishing such margin,
       ``(iv) with respect to countermeasures, the scope and 
     duration of countermeasures and, if applicable, any changes 
     thereto, and
       ``(v) 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 under section 805 or 807(c) an explanation of 
     the basis for its determination that addresses relevant 
     arguments, made by interested parties who are parties to the 
     investigation, concerning the establishment of the injurious 
     pricing charge 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 concerning the 
     effects and impact on the industry of the sale of the subject 
     vessel.

     ``SEC. 844. CONDUCT OF INVESTIGATIONS.

       ``(a) 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.
       ``(b) 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 under this title, and shall provide to such 
     interested parties any assistance that is practicable in 
     supplying such information.
       ``(c) 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 (d), disregard all or 
     part of the original and subsequent responses.
       ``(d) Use of Certain Information.--In reaching a 
     determination under section 803, 805, or 807, 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.
       ``(e) Nonacceptance of Submissions.--If the administering 
     authority or the Commission declines to accept into the 
     record any information submitted in an investigation 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.
       ``(f) 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 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 
     805 or 807, 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.
       ``(g) Verification.--The administering authority shall 
     verify all information relied upon in making a final 
     determination under section 805.

     ``SEC. 845. ADMINISTRATIVE ACTION FOLLOWING SHIPBUILDING 
                   AGREEMENT PANEL REPORTS.

       ``(a) Action by United States International Trade 
     Commission.--
        ``(1) Advisory report.--If a dispute settlement panel 
     under the Shipbuilding Agreement finds in a report that an 
     action by the Commission in connection with a particular 
     proceeding under this title is not in conformity with the 
     obligations of the United States under the Shipbuilding 
     Agreement, the Trade Representative may request the 
     Commission to issue an advisory report on whether this title 
     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 concerning those 
     obligations. The Trade Representative shall notify the 
     Committee on Ways and Means of the House of Representatives 
     and the Committee on Finance of the Senate of such request.
       ``(2) Time limits for report.--The Commission shall 
     transmit its report under paragraph (1) to the Trade 
     Representative within 30 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 
     Representatives shall consult with the congressional 
     committees listed in paragraph (1) concerning the matter.
       ``(4) Commission determination.--Notwithstanding any other 
     provision of this title, 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. The Commission 
     shall issue its determination not later than 120 calendar 
     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 listed in paragraph (1) 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 injurious 
     pricing order is no longer supported by an affirmative 
     Commission determination under this title, the Trade 
     Representative may, after consulting with the congressional 
     committees under paragraph (5), direct the administering 
     authority to revoke the injurious pricing order.
       ``(b) Action by Administering Authority.--
       ``(1) Consultations with administering authority and 
     congressional committees.--Promptly after a report or other 
     determination by a dispute settlement panel under the 
     Shipbuilding Agreement is issued that contains findings 
     that--
       ``(A) an action by the administering authority in a 
     proceeding under this title is not in conformity with the 
     obligations of the United States under the Shipbuilding 
     Agreement,
       ``(B) the due date for payment of an injurious pricing 
     charge contained in an order issued under section 806 should 
     be amended,
       ``(C) countermeasures provided for in an order issued under 
     section 807 should be provisionally suspended or reduced 
     pending the final decision of the panel, or
       ``(D) the scope or duration of countermeasures imposed 
     under section 807 should be narrowed or shortened,

     the Trade Representative shall consult with the administering 
     authority and the congressional committees listed in 
     subsection (a)(1) on the matter.
       ``(2) Determination by administering authority.--
     Notwithstanding any other provision of this title, the 
     administering authority shall, in response to a written 
     request from the Trade Representative, issue a determination, 
     or an amendment to or suspension of an injurious pricing or 
     countermeasure order, as the case may be, in connection with 
     the particular proceeding that would render the administering

[[Page H6311]]

     authority's action described in paragraph (1) not 
     inconsistent with the findings of the panel.
       ``(3) Time limits for determinations.--The administering 
     authority shall issue its determination, amendment, or 
     suspension under paragraph (2)--
       ``(A) with respect to a matter described in subparagraph 
     (A) of paragraph (1), within 180 calendar days after the 
     request from the Trade Representative is made, and
       ``(B) with respect to a matter described in subparagraph 
     (B), (C), or (D) of paragraph (1), within 15 calendar days 
     after the request from the Trade Representative is made.
       ``(4) Consultations before implementation.--Before the 
     administering authority implements any determination, 
     amendment, or suspension under paragraph (2), the Trade 
     Representative shall consult with the administering authority 
     and the congressional committees listed in subsection (a)(1) 
     with respect to such determination, amendment, or suspension.
       ``(5) Implementation of determination.--The Trade 
     Representative may, after consulting with the administering 
     authority and the congressional committees under paragraph 
     (4), direct the administering authority to implement, in 
     whole or in part, the determination, amendment, or suspension 
     made under paragraph (2).
       ``(6) Implementation of determination; notice of 
     implementation.--The administering authority shall implement 
     the determination, amendment, or suspension under paragraph 
     (2)--
       ``(A) with respect to a matter described in subparagraph 
     (A) of paragraph (1), only if the injurious pricing margin 
     determined under paragraph (2) differs from the injurious 
     pricing margin in the determination reviewed by the panel, 
     and
       ``(B) with respect to a matter described in subparagraph 
     (B), (C), or (D) of paragraph (1), upon issuance of the 
     determination, amendment, or suspension under paragraph (2).
     The administering authority shall publish notice of such 
     implementation in the Federal Register.
       ``(c) Opportunity for Comment by Interested Parties.--
     Before issuing a determination, amendment, or suspension, the 
     administering authority, in a matter described in subsection 
     (b)(1)(A), or the Commission, in a matter described in 
     subsection (a)(1), 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.
                       ``Subtitle D--Definitions

     ``SEC. 861. DEFINITIONS.

       ``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 as provided in paragraph 
     (16)(E)(iii), may not 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.--Except as used in section 808, the term 
     `industry' means the producers as a whole of a domestic like 
     vessel, or those producers whose collective capability to 
     produce a domestic like vessel constitutes a major proportion 
     of the total domestic capability to produce a domestic like 
     vessel.
       ``(B) Producer.--A `producer' of a domestic like vessel 
     includes an entity that is producing the domestic like vessel 
     and an entity with the capability to produce the domestic 
     like vessel.
       ``(C) Capability to produce a domestic like vessel.--A 
     producer has the `capability to produce a domestic like 
     vessel' if it is capable of producing a domestic like vessel 
     with its present facilities or could adapt its facilities in 
     a timely manner to produce a domestic like vessel.
       ``(D) Related parties.--(i) In an investigation under this 
     title, if a producer of a domestic like vessel and the 
     foreign producer, seller (other than the foreign producer), 
     or United States buyer of the subject vessel are related 
     parties, or if a producer of a domestic like vessel is also a 
     United States buyer of the subject vessel, the domestic 
     producer may, in appropriate circumstances, be excluded from 
     the industry.
       ``(ii) For purposes of clause (i), a domestic producer and 
     the foreign producer, seller, or United States buyer shall be 
     considered to be related parties, if--
       ``(I) the domestic producer directly or indirectly controls 
     the foreign producer, seller or United States buyer,
       ``(II) the foreign producer, seller, or United States buyer 
     directly or indirectly controls the domestic producer,
       ``(III) a third party directly or indirectly controls the 
     domestic producer and the foreign producer, seller, or United 
     States buyer, or
       ``(IV) the domestic producer and the foreign producer, 
     seller, or United States buyer 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.
       ``(E) Product lines.--In an investigation under this title, 
     the effect of the sale of the subject vessel shall be 
     assessed in relation to the United States production (or 
     production capability) of a domestic like vessel if available 
     data permit the separate identification of production (or 
     production capability) in terms of such criteria as the 
     production process or the producer's profits. If the domestic 
     production (or production capability) of a domestic like 
     vessel has no separate identity in terms of such criteria, 
     then the effect of the sale shall be assessed by the 
     examination of the production (or production capability) of 
     the narrowest group or range of vessels, which includes a 
     domestic like vessel, for which the necessary information can 
     be provided.
       ``(5) Buyer.--The term `buyer' means any person who 
     acquires an ownership interest in a vessel, including by way 
     of lease or long-term bareboat charter, in conjunction with 
     the original transfer from the producer, either directly or 
     indirectly, including an individual or company which owns or 
     controls a buyer. There may be more than one buyer of any one 
     vessel.
       ``(6) United states buyer.--The term `United States buyer' 
     means a buyer that is any of the following:
       ``(A) A United States citizen.
       ``(B) A juridical entity, including any corporation, 
     company, association, or other organization, that is legally 
     constituted under the laws and regulations of the United 
     States or a political subdivision thereof, regardless of 
     whether the entity is organized for pecuniary gain, privately 
     or government owned, or organized with limited or unlimited 
     liability.
       ``(C) A juridical entity that is owned or controlled by 
     nationals or entities described in subparagraphs (A) and (B). 
     For the purposes of this subparagraph--
       ``(i) the term `own' means having more than a 50 percent 
     interest, and
       ``(ii) the term `control' means the actual ability to have 
     substantial influence on corporate behavior, and control is 
     presumed to exist where there is at least a 25 percent 
     interest.

     If ownership of a company is established under clause (i), 
     other control is presumed not to exist unless it is otherwise 
     established.
       ``(7) Ownership interest.--An `ownership interest' in a 
     vessel includes any contractual or proprietary interest which 
     allows the beneficiary or beneficiaries of such interest to 
     take advantage of the operation of the vessel in a manner 
     substantially comparable to the way in which an owner may 
     benefit from the operation of the vessel. In determining 
     whether such substantial comparability exists, the 
     administering authority shall consider--
       ``(A) the terms and circumstances of the transaction which 
     conveys the interest,
       ``(B) commercial practice,
       ``(C) whether the vessel subject to the transaction is 
     integrated into the operations of the beneficiary or 
     beneficiaries, and
       ``(D) whether in practice there is a likelihood that the 
     beneficiary or beneficiaries of such interests will take 
     advantage of and the risk for the operation of the vessel for 
     a significant part of the life-time of the vessel.
       ``(8) Vessel.--
       ``(A) In general.--Except as otherwise specifically 
     provided under international agreements, the term `vessel' 
     means--
       ``(i) a self-propelled seagoing vessel of 100 gross tons or 
     more used for transportation of goods or persons or for 
     performance of a specialized service (including, but not 
     limited to, ice breakers and dredgers), and
       ``(ii) a tug of 365 kilowatts or more,
     that is produced in a Shipbuilding Agreement Party or a 
     country that is not a Shipbuilding Agreement Party and not a 
     WTO member.
       ``(B) Exclusions.--The term `vessel' does not include--
       ``(i) any fishing vessel destined for the fishing fleet of 
     the country in which the vessel is built,
       ``(ii) any military vessel, and
       ``(iii) any vessel sold before the date that the 
     Shipbuilding Agreement enters into force with respect to the 
     United States, except that any vessel sold after December 21, 
     1994, for delivery more than 5 years after the date of the 
     contract of sale shall be a `vessel' for purposes of this 
     title unless the shipbuilder demonstrates to the 
     administering authority that the extended delivery date was 
     for normal commercial reasons and not to avoid applicability 
     of this title.
       ``(C) Self-propelled seagoing vessel.--A vessel is `self-
     propelled seagoing' if its permanent propulsion and steering 
     provide it all the characteristics of self-navigability in 
     the high seas.
       ``(D) Military vessel.--A `military vessel' is a vessel 
     which, according to its basic structural characteristics and 
     ability, is intended to be used exclusively for military 
     purposes.
       ``(9) Like vessel.--The term `like vessel' means a vessel 
     of the same type, same purpose, and approximate size as the 
     subject vessel and possessing characteristics closely 
     resembling those of the subject vessel.
       ``(10) Domestic like vessel.--The term `domestic like 
     vessel' means a like vessel produced in the United States.
       ``(11) Foreign like vessel.--Except as used in section 
     822(e)(1)(B)(ii)(II), the term `foreign like vessel' means a 
     like vessel produced by the foreign producer of the subject 
     vessel for sale in the producer's domestic market or in a 
     third country.
       ``(12) Same general category of vessel.--The term `same 
     general category of vessel' means a vessel of the same type 
     and purpose as the subject vessel, but of a significantly 
     different size.
       ``(13) Subject vessel.--The term `subject vessel' means a 
     vessel subject to investigation under section 801 or 808.
       ``(14) Foreign producer.--The term `foreign producer' means 
     the producer or producers of the subject vessel.
       ``(15) Exporting country.--The term `exporting country' 
     means the country in which the subject vessel was built.
       ``(16) Material injury.--
       ``(A) In general.--The term `material injury' means harm 
     which is not inconsequential, immaterial, or unimportant.

[[Page H6312]]

       ``(B) Sale and consequent impact.--In making determinations 
     under sections 803(a) and 805(b), the Commission in each 
     case--
       ``(i) shall consider--

       ``(I) the sale of the subject vessel,
       ``(II) the effect of the sale of the subject vessel on 
     prices in the United States for a domestic like vessel, and
       ``(III) the impact of the sale of the subject vessel on 
     domestic producers of the domestic like vessel, 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 or 
     has been material injury by reason of the sale of the subject 
     vessel.

     In the notification required under section 805(d), 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) Sale of the subject vessel.--In evaluating the sale 
     of the subject vessel, the Commission shall consider whether 
     the sale, either in absolute terms or relative to production 
     or demand in the United States, in terms of either volume or 
     value, is or has been significant.
       ``(ii) Price.--In evaluating the effect of the sale of the 
     subject vessel on prices, the Commission shall consider 
     whether--

       ``(I) there has been significant price underselling of the 
     subject vessel as compared with the price of a domestic like 
     vessel, and
       ``(II) the effect of the sale of the subject vessel 
     otherwise depresses or has depressed prices to a significant 
     degree or prevents or has prevented 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, including with 
     regard to sales,
       ``(III) actual and potential negative effects on cash flow, 
     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 a domestic like vessel, and
       ``(V) the magnitude of the injurious pricing margin.

     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.
       ``(D) Standard for determination.--The presence or absence 
     of any factor which the Commission is required to evaluate 
     under subparagraph (C) shall not necessarily give decisive 
     guidance with respect to the determination by the Commission 
     of material injury.
       ``(E) Threat of material injury.--
       ``(i) In general.--In determining whether an industry in 
     the United States is threatened with material injury by 
     reason of the sale of the subject vessel, the Commission 
     shall consider, among other relevant economic factors--

       ``(I) any existing unused production capacity or imminent, 
     substantial increase in production capacity in the exporting 
     country indicating the likelihood of substantially increased 
     sales of a foreign like vessel to United States buyers, 
     taking into account the availability of other export markets 
     to absorb any additional exports,
       ``(II) whether the sale of a foreign like vessel or other 
     factors indicate the likelihood of significant additional 
     sales to United States buyers,
       ``(III) whether sale of the subject vessel or sale of a 
     foreign like vessel by the foreign producer are at prices 
     that are likely to have a significant depressing or 
     suppressing effect on domestic prices, and are likely to 
     increase demand for further sales,

       ``(IV) the potential for product-shifting if production 
     facilities in the exporting country, which can presently be 
     used to produce a foreign like vessel or could be adapted in 
     a timely manner to produce a foreign like vessel, are 
     currently being used to produce other types of vessels,
       ``(V) 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 a domestic like vessel, and
       ``(VI) any other demonstrable adverse trends that indicate 
     the probability that there is likely to be material injury by 
     reason of the sale of the subject vessel.

       ``(ii) Basis for determination.--The Commission shall 
     consider the factors set forth in clause (i) as a whole. 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 injurious pricing in third-country 
     markets.--

       ``(I) In general.--The Commission shall consider whether 
     injurious pricing in the markets of foreign countries (as 
     evidenced by injurious pricing findings or injurious pricing 
     remedies of other Shipbuilding Agreement Parties, or 
     antidumping determinations of, or measures imposed by, other 
     countries, against a like vessel produced by the producer 
     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 
     producer or United States buyer concerning this issue.
       ``(II) European communities.--For purposes of this clause, 
     the European Communities as a whole shall be treated as a 
     single foreign country.

       ``(F) Cumulation for determining material injury.--
       ``(i) In general.--For purposes of clauses (i) and (ii) of 
     subparagraph (C), and subject to clause (ii) of this 
     subparagraph, the Commission shall cumulatively assess the 
     effects of sales of foreign like vessels from all foreign 
     producers with respect to which--

       ``(I) petitions were filed under section 802(b) on the same 
     day,
       ``(II) investigations were initiated under section 802(a) 
     on the same day, or
       ``(III) petitions were filed under section 802(b) and 
     investigations were initiated under section 802(a) on the 
     same day,

     if, with respect to such vessels, the foreign producers 
     compete with each other and with producers of a domestic like 
     vessel in the United States market.
       ``(ii) Exceptions.--The Commission shall not cumulatively 
     assess the effects of sales 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 sales before the 
     Commission's final determination is made, or
       ``(II) from any producer with respect to which the 
     investigation has been terminated.

       ``(iii) Records in final investigations.--In each final 
     determination in which it cumulatively assesses the effects 
     of sales under clause (i), the Commission may 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.
       ``(G) Cumulation for determining threat of material 
     injury.--To the extent practicable and subject to 
     subparagraph (F)(ii), for purposes of clause (i) (II) and 
     (III) of subparagraph (E), the Commission may cumulatively 
     assess the effects of sales of like vessels from all 
     countries with respect to which--
       ``(i) petitions were filed under section 802(b) on the same 
     day,
       ``(ii) investigations were initiated under section 802(a) 
     on the same day, or
       ``(iii) petitions were filed under section 802(b) and 
     investigations were initiated under section 802(a) on the 
     same day,

     if, with respect to such vessels, the foreign producers 
     compete with each other and with producers of a domestic like 
     vessel in the United States market.
       ``(17) Interested party.--The term `interested party' 
     means, in a proceeding under this title--
       ``(A)(i) the foreign producer, seller (other than the 
     foreign producer), and the United States buyer of the subject 
     vessel, or
       ``(ii) a trade or business association a majority of the 
     members of which are the foreign producer, seller, or United 
     States buyer of the subject vessel,
       ``(B) the government of the country in which the subject 
     vessel is produced or manufactured,
       ``(C) a producer that is a member of an industry,
       ``(D) a certified union or recognized union or group of 
     workers which is representative of an industry,
       ``(E) a trade or business association a majority of whose 
     members are producers in an industry,
       ``(F) an association, a majority of whose members is 
     composed of interested parties described in subparagraph (C), 
     (D), or (E), and
       ``(G) for purposes of section 807, a purchaser who, after 
     the effective date of an order issued under that section, 
     entered into a contract of sale with the foreign producer 
     that is subject to the order.
       ``(18) Affirmative determinations by divided commission.--
     If the Commissioners voting on a determination by the 
     Commission 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 or has been--
       ``(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 the sale of the subject vessel, an affirmative 
     vote on any of the issues shall be treated as a vote that the 
     determination should be affirmative.
       ``(19) Ordinary course of trade.--The term `ordinary course 
     of trade' means the conditions and practices which, for a 
     reasonable time before the sale of the subject vessel, have 
     been normal in the shipbuilding industry with respect to a 
     like vessel. The administering authority shall consider the 
     following sales and transactions, among others, to be outside 
     the ordinary course of trade:

[[Page H6313]]

       ``(A) Sales disregarded under section 822(b)(1).
       ``(B) Transactions disregarded under section 822(f)(2).
       ``(20) 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 vessels in such country 
     do not reflect the fair value of the vessels.
       ``(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 A.
       ``(21) Shipbuilding agreement.--The term `Shipbuilding 
     Agreement' means The Agreement Respecting Normal Competitive 
     Conditions in the Commercial Shipbuilding and Repair 
     Industry, resulting from negotiations under the auspices of 
     the Organization for Economic Cooperation and Development, 
     and entered into on December 21, 1994.
       ``(22) Shipbuilding agreement party.--The term 
     `Shipbuilding Agreement Party' means a state or separate 
     customs territory that is a Party to the Shipbuilding 
     Agreement, and with respect to which the United States 
     applies the Shipbuilding Agreement.
       ``(23) WTO agreement.--The term `WTO Agreement' means the 
     Agreement defined in section 2(9) of the Uruguay Round 
     Agreements Act.
       ``(24) WTO member.--The term `WTO member' means 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.
       ``(25) Trade representative.--The term `Trade 
     Representative' means the United States Trade Representative.
       ``(26) 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.
       ``(27) Injurious pricing.--The term `injurious pricing' 
     refers to the sale of a vessel at less than fair value.
       ``(28) Injurious pricing margin.--
       ``(A) In general.--The term `injurious pricing margin' 
     means the amount by which the normal value exceeds the export 
     price of the subject vessel.
       ``(B) Magnitude of the injurious pricing margin.--The 
     magnitude of the injurious pricing margin used by the 
     Commission shall be--
       ``(i) in making a preliminary determination under section 
     803(a) in an investigation (including any investigation in 
     which the Commission cumulatively assesses the effect of 
     sales under paragraph (16)(F)(i)), the injurious pricing 
     margin or margins published by the administering authority in 
     its notice of initiation of the investigation; and
       ``(ii) in making a final determination under section 
     805(b), the injurious pricing margin or margins most recently 
     published by the administering authority before the closing 
     of the Commission's administrative record.
       ``(29) Commercial interest reference rate.--The term 
     `Commercial Interest Reference Rate' or `CIRR' means an 
     interest rate that the administering authority determines to 
     be consistent with Annex III, and appendices and notes 
     thereto, of the Understanding on Export Credits for Ships, 
     resulting from negotiations under the auspices of the 
     Organization for Economic Cooperation, and entered into on 
     December 21, 1994.
       ``(30) Antidumping.--
       ``(A) WTO members.--In the case of a WTO member, the term 
     `antidumping' refers to action taken pursuant to the 
     Agreement on Implementation of Article VI of the General 
     Agreement on Tariffs and Trade 1994.
       ``(B) Other cases.--In the case of any country that is not 
     a WTO member, the term `antidumping' refers to action taken 
     by the country against the sale of a vessel at less than fair 
     value that is comparable to action described in subparagraph 
     (A).
       ``(31) Broad multiple bid.--The term `broad multiple bid' 
     means a bid in which the proposed buyer extends an invitation 
     to at least all the producers in the industry known by the 
     buyer to be capable of building the subject vessel.''.

     SEC. 102. ENFORCEMENT OF COUNTERMEASURES.

       Part II of title IV of the Tariff Act of 1930 is amended by 
     adding at the end the following:

     ``SEC. 468. SHIPBUILDING AGREEMENT COUNTERMEASURES.

       ``(a) In General.--Notwithstanding any other provision of 
     law, upon receiving from the Secretary of Commerce a list of 
     vessels subject to countermeasures under section 807, the 
     Customs Service shall deny any request for a permit to lade 
     or unlade passengers, merchandise, or baggage from or onto 
     those vessels so listed.
       ``(b) Exceptions.--Subsection (a) shall not be applied to 
     deny a permit for the following:
       ``(1) To unlade any United States citizen or permanent 
     legal resident alien from a vessel included in the list 
     described in subsection (a), or to unlade any refugee or any 
     alien who would otherwise be eligible to apply for asylum and 
     withholding of deportation under the Immigration and 
     Nationality Act.
       ``(2) To lade or unlade any crewmember of such vessel.
       ``(3) To lade or unlade coal and other fuel supplies (for 
     the operation of the listed vessel), ships' stores, sea 
     stores, and the legitimate equipment of such vessel.
       ``(4) To lade or unlade supplies for the use or sale on 
     such vessel.
       ``(5) To lade or unlade such other merchandise, baggage, or 
     passenger as the Customs Service shall determine necessary to 
     protect the immediate health, safety, or welfare of a human 
     being.
       ``(c) Correction of Ministerial or Clerical Errors.--
       ``(1) Petition for correction.--If the master of any vessel 
     whose application for a permit to lade or unlade has been 
     denied under this section believes that such denial resulted 
     from a ministerial or clerical error, not amounting to a 
     mistake of law, committed by any Customs officer, the master 
     may petition the Customs Service for correction of such 
     error, as provided by regulation.
       ``(2) Inapplicability of sections 514 and 520.--
     Notwithstanding paragraph (1), imposition of countermeasures 
     under this section shall not be deemed an exclusion or other 
     protestable decision under section 514, and shall not be 
     subject to correction under section 520.
       ``(3) Petitions seeking administrative review.--Any 
     petition seeking administrative review of any matter 
     regarding the Secretary of Commerce's decision to list a 
     vessel under section 807 must be brought under that section.
       ``(d) Penalties.--In addition to any other provision of 
     law, the Customs Service may impose a civil penalty of not to 
     exceed $10,000 against the master of any vessel--
       ``(1) who submits false information in requesting any 
     permit to lade or unlade; or
       ``(2) who attempts to, or actually does, lade or unlade in 
     violation of any denial of such permit under this section.''.

     SEC. 103. JUDICIAL REVIEW IN INJURIOUS PRICING AND 
                   COUNTERMEASURE PROCEEDINGS.

       (a) Judicial Review.--Part III of title IV of the Tariff 
     Act of 1930 is amended by inserting after section 516A the 
     following:

     ``SEC. 516B. JUDICIAL REVIEW IN INJURIOUS PRICING AND 
                   COUNTERMEASURE PROCEEDINGS.

       ``(a) Review of Determination.--
       ``(1) In general.--Within 30 days after the date of 
     publication in the Federal Register of--
       ``(A)(i) a determination by the administering authority 
     under section 802(c) not to initiate an investigation,
       ``(ii) a negative determination by the Commission under 
     section 803(a) as to whether there is or has been reasonable 
     indication of material injury, threat of material injury, or 
     material retardation,
       ``(iii) a determination by the administering authority to 
     suspend or revoke an injurious pricing order under section 
     806(d) or (e),
       ``(iv) a determination by the administering authority under 
     section 807(c),
       ``(v) a determination by the administering authority in a 
     review under section 807(d),
       ``(vi) a determination by the administering authority 
     concerning whether to extend the scope or duration of a 
     countermeasure order under section 807(e)(3)(B)(ii),
       ``(vii) a determination by the administering authority to 
     amend a countermeasure order under section 807(e)(6),
       ``(viii) a determination by the administering authority in 
     a review under section 807(g),
       ``(ix) a determination by the administering authority under 
     section 807(i) to terminate proceedings, or to amend or 
     revoke a countermeasure order,
       ``(x) a determination by the administering authority under 
     section 845(b), with respect to a matter described in 
     paragraph (1)(D) of that section, or
       ``(B)(i) an injurious pricing order based on a 
     determination described in subparagraph (A) of paragraph (2),
       ``(ii) notice of a determination described in subparagraph 
     (B) of paragraph (2),
       ``(iii) notice of implementation of a determination 
     described in subparagraph (C) of paragraph (2), or
       ``(iv) notice of revocation of an injurious pricing order 
     based on a determination described in subparagraph (D) of 
     paragraph (2),

[[Page H6314]]

     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) Reviewable determinations.--The determinations 
     referred to in paragraph (1)(B) are--
       ``(A) a final affirmative determination by the 
     administering authority or by the Commission under section 
     805, including any negative part of such a determination 
     (other than a part referred to in subparagraph (B)),
       ``(B) a final negative determination by the administering 
     authority or the Commission under section 805,
       ``(C) a determination by the administering authority under 
     section 845(b), with respect to a matter described in 
     paragraph (1)(A) of that section, and
       ``(D) a determination by the Commission under section 
     845(a) that results in the revocation of an injurious pricing 
     order.
       ``(3) Exception.--Notwithstanding the 30-day limitation 
     imposed by paragraph (1) with regard to an order described in 
     paragraph (1)(B)(i), a final affirmative determination by the 
     administering authority under section 805 may be contested by 
     commencing an action, in accordance with the provisions of 
     paragraph (1), within 30 days after the date of publication 
     in the Federal Register of a final negative determination by 
     the Commission under section 805.
       ``(4) Procedures and fees.--The procedures and fees set 
     forth in chapter 169 of title 28, United States Code, apply 
     to an action under this section.
       ``(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) of 
     subsection (a)(1), to be arbitrary, capricious, an abuse of 
     discretion, or otherwise not in accordance with law, or
       ``(B) in an action brought under subparagraph (B) of 
     subsection (a)(1), to be unsupported by substantial evidence 
     on the record, or otherwise not in accordance with law.
       ``(2) Record for review.--
       ``(A) In general.--For 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 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 
     843(a)(2); 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.
       ``(c) Standing.--Any interested party who was a party to 
     the proceeding under title VIII shall have the right to 
     appear and be heard as a party in interest before the United 
     States Court of International Trade in an action under this 
     section. 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.
       ``(d) Definitions.--For purposes of this section:
       ``(1) Administering authority.--The term `administering 
     authority' has the meaning given that term in section 861(1).
       ``(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 861(17).''.
       (b) Conforming Amendments.--
       (1) Jurisdiction of the court.--Section 1581(c) of title 
     28, United States Code, is amended by inserting ``or 516B'' 
     after ``section 516A''.
       (2) Relief.--Section 2643 of title 28, United States Code, 
     is amended--
       (A) in subsection (c)(1) by striking ``and (5)'' and 
     inserting ``(5), and (6)''; and
       (B) in subsection (c) by adding at the end the following 
     new paragraph:
       ``(6) In any civil action under section 516B of the Tariff 
     Act of 1930, the Court of International Trade may not issue 
     injunctions or any other form of equitable relief, except 
     with regard to implementation of a countermeasure order under 
     section 468 of that Act, upon a proper showing that such 
     relief is warranted.''.
                       TITLE II--OTHER PROVISIONS

     SEC. 201. EQUIPMENT AND REPAIR OF VESSELS.

       Section 466 of the Tariff Act of 1930 (19 U.S.C. 1466), is 
     amended by adding at the end the following new subsection:
       ``(i) The duty imposed by subsection (a) shall not apply 
     with respect to activities occurring in a Shipbuilding 
     Agreement Party, as defined in section 861(22), with respect 
     to--
       ``(1) self-propelled seagoing vessels of 100 gross tons or 
     more that are used for transportation of goods or persons or 
     for performance of a specialized service (including, but not 
     limited to, ice breakers and dredges), and
       ``(2) tugs of 365 kilowatts or more.

     A vessel shall be considered `self-propelled seagoing' if its 
     permanent propulsion and steering provide it all the 
     characteristics of self-navigability in the high seas.''.

     SEC. 202. 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 the 
     Shipbuilding Agreement or by virtue of congressional approval 
     of the agreement, 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, the 
     District of Columbia, any State, any political subdivision of 
     a State, or any territory or possession of the United States 
     on the ground that such action or inaction is inconsistent 
     with such agreement.

     SEC. 203. IMPLEMENTING REGULATIONS.

       After the date of the enactment of this Act, the heads of 
     agencies with functions under this Act and the amendments 
     made by this Act may issue such regulations as may be 
     necessary to ensure that this Act is appropriately 
     implemented on the date the Shipbuilding Agreement enters 
     into force with respect to the United States.

     SEC. 204. AMENDMENTS TO THE MERCHANT MARINE ACT, 1936.

       The Merchant Marine Act, 1936, is amended as follows:
       (1) Section 511(a)(2) (46 App. U.S.C. 1161(a)(2)) is 
     amended by inserting after ``1939,'' the following: ``or, if 
     the vessel is a Shipbuilding Agreement vessel, constructed in 
     a Shipbuilding Agreement Party, but only with regard to 
     moneys deposited, on or after the date on which the 
     Shipbuilding Trade Agreement Act takes effect, into a 
     construction reserve fund established under subsection (b)''.
       (2) Section 601(a) (46 App. U.S.C. 1171(a)) is amended by 
     striking ``, and that such vessel or vessels were built in 
     the United States, or have been documented under the laws of 
     the United States not later than February 1, 1928, or 
     actually ordered and under construction for the account of 
     citizens of the United States prior to such date'' and 
     inserting ``and that such vessel or vessels were built in the 
     United States, or, if the vessel or vessels are Shipbuilding 
     Agreement vessels, in a Shipbuilding Agreement Party''.
       (3) Section 606(6) (46 App. U.S.C. 1176(6)) is amended by 
     inserting ``or, if the vessel is a Shipbuilding Agreement 
     vessel, in a Shipbuilding Agreement Party or in the United 
     States'' before ``, except in an emergency.''.
       (4) Section 607 (46 App. U.S.C. 1177) is amended as 
     follows:
       (A) Subsection (a) is amended by inserting ``or, if the 
     vessel is a Shipbuilding Agreement vessel, in a Shipbuilding 
     Agreement Party,'' after ``built in the United States''.
       (B) Subsection (k) is amended as follows:
       (i) Paragraph (1) is amended by striking subparagraph (A) 
     and inserting the following:
       ``(A)(i) constructed in the United States and, if 
     reconstructed, reconstructed in the United States or in a 
     Shipbuilding Agreement Party, or
       ``(ii) that is a Shipbuilding Agreement vessel and is 
     constructed in a Shipbuilding Agreement Party and, if 
     reconstructed, is reconstructed in a Shipbuilding Agreement 
     Party or in the United States,''.
       (ii) Paragraph (2)(A) is amended to read as follows:
       ``(A)(i) constructed in the United States and, if 
     reconstructed, reconstructed in the United States or in a 
     Shipbuilding Agreement Party, or
       ``(ii) that is a Shipbuilding Agreement vessel and is 
     constructed in a Shipbuilding Agreement Party and, if 
     reconstructed, is reconstructed in a Shipbuilding Agreement 
     Party or in the United States, but only with regard to moneys 
     deposited into the fund on or after the date on which the 
     Shipbuilding Trade Agreement Act takes effect,''.
       (5) Section 610 (46 App. U.S.C. 1180) is amended by 
     striking ``shall be built in a domestic yard or shall have 
     been documented under the laws of the United States not later 
     than February 1, 1928, or actually ordered and under 
     construction for the account of citizens of the United States 
     prior to such date,'' and inserting ``shall be built in the 
     United States or, if the vessel is a Shipbuilding Agreement 
     vessel, in a Shipbuilding Agreement Party,''.
       (6) Section 901(b)(1) (46 App. U.S.C. 1241(b)(1)) is 
     amended by striking the third sentence and inserting the 
     following:

     ``For purposes of this section, the term `privately owned 
     United States-flag commercial vessels' shall be deemed to 
     include--
       ``(A) any privately owned United States-flag commercial 
     vessel constructed in the United States, and if rebuilt, 
     rebuilt in the United States or in a Shipbuilding Agreement 
     Party on or after the date on which the Shipbuilding Trade 
     Agreement Act takes effect, and
       ``(B) any privately owned vessel constructed in a 
     Shipbuilding Agreement Party on or after the date on which 
     the Shipbuilding Trade Agreement Act takes effect, and if 
     rebuilt, rebuilt in a Shipbuilding Agreement Party or in the 
     United States, that is documented pursuant to chapter 121 of 
     title 46, United States Code.

     The term `privately owned United States-flag commercial 
     vessels' shall also be deemed to include any cargo vessel 
     that so qualified pursuant to section 615 of this Act or this 
     paragraph before the date on which the Shipbuilding Trade 
     Agreement Act takes effect. The term `privately owned United 
     States-flag commercial vessels' shall not be deemed to 
     include any liquid bulk cargo vessel that does not meet the 
     requirements of section 3703a of title 46, United States 
     Code.''.
       (7) Section 905 (46 App. U.S.C. 1244) is amended by adding 
     at the end the following:
       ``(h) The term `Shipbuilding Agreement' means the Agreement 
     Respecting Normal Competitive Conditions in the Commercial 
     Shipbuilding and Repair Industry, which resulted from

[[Page H6315]]

     negotiations under the auspices of the Organization for 
     Economic Cooperation and Development, and was entered into on 
     December 21, 1994.
       ``(i) The term `Shipbuilding Agreement Party' means a state 
     or separate customs territory that is a Party to the 
     Shipbuilding Agreement, and with respect to which the United 
     States applies the Shipbuilding Agreement.
       ``(j) The term `Shipbuilding Agreement vessel' means a 
     vessel to which the Secretary determines Article 2.1 of the 
     Shipbuilding Agreement applies.
       ``(k) The term `Export Credit Understanding' means the 
     Understanding on Export Credits for Ships which resulted from 
     negotiations under the auspices of the Organization for 
     Economic Cooperation and Development and was entered into on 
     December 21, 1994.
       ``(l) The term `Export Credit Understanding vessel' means a 
     vessel to which the Secretary determines the Export Credit 
     Understanding applies.''.
       (8) Section 1104A (46 App. U.S.C. 1274) is amended as 
     follows:
       (A) Paragraph (5) of subsection (b) is amended to read as 
     follows:
       ``(5) shall bear interest (exclusive of charges for the 
     guarantee and service charges, if any) at rates not to exceed 
     such percent per annum on the unpaid principal as the 
     Secretary determines to be reasonable, taking into account 
     the range of interest rates prevailing in the private market 
     for similar loans and the risks assumed by the Secretary, 
     except that, with respect to Export Credit Understanding 
     vessels, and Shipbuilding Agreement vessels, the obligations 
     shall bear interest at a rate the Secretary determines to be 
     consistent with obligations of the United States under the 
     Export Credit Understanding or the Shipbuilding Agreement, as 
     the case may be;''.
       (B) Subsection (i) is amended to read as follows:
       ``(i)(1) Except as provided in paragraph (2), the Secretary 
     may not, with respect to--
       ``(A) the general 75 percent or less limitation contained 
     in subsection (b)(2),
       ``(B) the 87\1/2\ percent or less limitation contained in 
     the 1st, 2nd, 4th, or 5th proviso to subsection (b)(2) or in 
     section 1112(b), or
       ``(C) the 80 percent or less limitation in the 3rd proviso 
     to such subsection,
     establish by rule, regulation, or procedure any percentage 
     within any such limitation that is, or is intended to be, 
     applied uniformly to all guarantees or commitments to 
     guarantee made under this section that are subject to the 
     limitation.
       ``(2) With respect to Export Credit Understanding vessels 
     and Shipbuilding Agreement vessels, the Secretary may 
     establish by rule, regulation, or procedure a uniform 
     percentage that the Secretary determines to be consistent 
     with obligations of the United States under the Export Credit 
     Understanding or the Shipbuilding Agreement, as the case may 
     be.''.
       (C) Section 1104B(b) (46 App. U.S.C. 1274a(b)) is amended 
     by striking the period at the end and inserting the 
     following:

     ``, except that, with respect to Export Credit Understanding 
     vessels and Shipbuilding Agreement vessels, the Secretary may 
     establish by rule, regulation, or procedure a uniform 
     percentage that the Secretary determines to be consistent 
     with obligations of the United States under the Export Credit 
     Understanding or the Shipbuilding Agreement, as the case may 
     be.''.

     SEC. 205. WITHDRAWAL FROM THE AGREEMENT.

       (a) Withdrawal.--
       (1) Notice.--The President shall give notice, under Article 
     14 of the Shipbuilding Agreement, of intent of the United 
     States to withdraw from the Shipbuilding Agreement, as soon 
     as is practicable after one or more Shipbuilding Agreement 
     Parties give notice, under such article, of intent to 
     withdraw from the Shipbuilding Agreement, if paragraph (2) 
     applies.
       (2) Tonnage of new construction in withdrawing parties.--
     This paragraph applies if the combined gross tonnage of new 
     Shipbuilding Agreement vessels constructed in all 
     Shipbuilding Agreement Parties who have given notice to 
     withdraw from the Shipbuilding agreement, which were 
     delivered in the calendar year preceding the calendar year in 
     which the notice is given, is 15 percent or more of the gross 
     tonnage of new Shipbuilding Agreement vessels that were 
     constructed in all Shipbuilding Agreement Parties and were 
     delivered in the calendar year preceding the calendar year in 
     which the notice is given.
       (3) Termination of withdrawal.--If a Shipbuilding Agreement 
     Party described in paragraph (2) takes action to terminate 
     its withdrawal from the Shipbuilding Agreement, so that 
     paragraph (2) would not apply if that Party had not given the 
     notice to withdraw, the President may take the necessary 
     steps to terminate the notice of withdrawal of the United 
     States from the Shipbuilding Agreement.
       (b) Reinstatement of Laws.--If the United States withdraws 
     from the Shipbuilding agreement on the date on which such 
     withdrawal becomes effective, the amendments made by section 
     204 shall be deemed not to have been made, and the provisions 
     of law amended by section 204 shall, on and after such date, 
     be effective as if this Act had not been enacted.

     SEC. 206. DEFINITIONS.

       As used in this title--
       (1) the terms ``Shipbuilding Agreement'', ``Shipbuilding 
     agreement Party'', and ``Shipbuilding Agreement vessel'' have 
     the meanings given those terms in subsections (h), (i), and 
     (j), respectively, of section 905 of the Merchant Marine Act, 
     1936, as added by section 204(7) of this Act; and
       (2) the terms ``GATT 1994'' and ``Uruguay Round 
     Agreements'' have the meanings given those terms in section 2 
     of the Uruguay Round Agreements Act.
                       TITLE III--REVENUE OFFSET

     SEC. 301. PENALTIES FOR FAILURE TO DISCLOSE POSITION THAT 
                   CERTAIN INTERNATIONAL SHIPPING INCOME IS NOT 
                   INCLUDIBLE IN GROSS INCOME.

       (a) In General.--Section 883 of the Internal Revenue Code 
     of 1986 is amended by adding at the end the following new 
     subsection:
       ``(d) Penalties for Failure to Disclose Position That 
     Certain International Shipping Income Is Not Includible in 
     Gross Income.--
       ``(1) In general.--A taxpayer who, with respect to any tax 
     imposed by this title, takes the position that any of its 
     gross income derived from the international operation of a 
     ship or ships is not includible in gross income by reason of 
     subsection (a)(1) or section 872(b)(1) shall be entitled to 
     such treatment only if such position is disclosed (in such 
     manner as the Secretary may prescribe) on the return of tax 
     for such tax (or any statement attached to such return).
       ``(2) Additional penalties for failing to disclose 
     position.--If a taxpayer fails to meet the requirement of 
     paragraph (1) with respect to any taxable year--
       ``(A) the amount of the income from the international 
     operation of a ship or ships--
       ``(i) which is from sources without the United States, and
       ``(ii) which is attributable to a fixed place of business 
     in the United States,
     shall be treated for purposes of this title as effectively 
     connected with the conduct of a trade or business within the 
     United States, and
       ``(B) no deductions or credits shall be allowed which are 
     attributable to income from the international operation of a 
     ship or ships.
       ``(3) Reasonable cause exception.--This subsection shall 
     not apply to a failure to disclose a position if it is shown 
     that such failure is due to reasonable cause and not due to 
     willful neglect.''
       (b) Conforming Amendments.--
       (1) Paragraph (1) of section 872(b) of such Code is amended 
     by striking ``Gross income'' and inserting ``Except as 
     provided in section 883(d), gross income''.
       (2) Paragraph (1) of section 883(a) of such Code is amended 
     by striking ``Gross income'' and inserting ``Except as 
     provided in subsection (d), gross income''.
       (c) Effective Date.--
       (1) In general.--Notwithstanding section 3, the amendments 
     made by this section shall apply to taxable years beginning 
     after the later of--
       (A) December 31, 1996, or
       (B) the date that the Shipbuilding Agreement enters into 
     force with respect to the United States.
       (2) Coordination with treaties.--The amendments made by 
     this section shall not apply in any case where their 
     application would be contrary to any treaty obligation of the 
     United States.
       (d) Information To Be Provided by Customs Service.--The 
     United States Custom Service shall provide the Secretary of 
     the Treasury or his delegate with such information as may be 
     specified by such Secretary in order to enable such Secretary 
     to determine whether ships which are not registered in the 
     United States are engaged in transportation to or from the 
     United States.

  The CHAIRMAN. No other amendment is in order except the amendment 
printed in part 2 of the report. That amendment may be offered only by 
a member designated in the report, shall be considered read, shall be 
debatable for 1 hour, equally divided and controlled by the proponent 
and an opponent, shall not be subject to amendment, and shall not be 
subject to a demand for division of the question.
  It is now in order to consider the amendment printed in part 2 of the 
report.


                    amendment offered by mr. bateman

  Mr. BATEMAN. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment offered by Mr. Bateman: In section 3 (page 2, 
     line 15), strike ``This'' and insert ``Except as provided in 
     section 206, this''.
       Redesignate section 206 as section 209, and insert the 
     following after section 205:

      SEC. 296. APPLICABILITY OF TITLE XI AMENDMENTS.

       (a) Effective Date.--
       (1) In general.--Notwithstanding any provision of the 
     Shipbuilding Agreement or the Export Credit Understanding, 
     the amendments made by paragraph (8) of section 204 shall not 
     apply with respect to any commitment to guarantee made under 
     title XI of the Merchant Marine Act, 1936, before January 1, 
     1999, with respect to a vessel delivered--
       (A) before January 1, 2002, or
       (B) in the case of unusual circumstances to which paragraph 
     (2) applies, as soon after January 1, 2002, as is 
     practicable.
       (2) Unusual circumstances.--This paragraph applies in a 
     case in which unusual circumstances beyond the control of the 
     parties concerned prevent the delivery of a vessel by January 
     1, 2002. As used in this paragraph, the term ``unusual 
     circumstances'' means acts of God (other than ordinary storms 
     or inclement weather conditions), labor strikes, acts of 
     sabotage, explosions, fires, or vandalism, and similar 
     circumstances.

     SEC. 207. OTHER LAWS NOT AFFECTED.

       The Shipbuilding Agreement shall not affect, directly or 
     indirectly, the Merchant

[[Page H6316]]

     Marine Act, 1920, the Act of June 19, 1886 (46 U.S.C. App. 
     289), or any other provision of law set forth in Accompanying 
     Note 2 to Annex II to the Shipbuilding Agreement, and shall 
     not provide any mechanism to subject any producer of vessels 
     in the United States to financial penalties, duties, bid 
     restrictions, unfavorable bid preferences, or withdrawal of 
     concessions under the GATT 1994 or other Uruguay Round 
     Agreements, in the competition for international commercial 
     vessel construction or reconstruction orders because of 
     construction of vessels by United States shipbuilders for 
     operation in the coastwise trade of the United States.

     SEC. 208. PROTECTION OF UNITED STATES INTERESTS.

       Nothing in the Shipbuilding Agreement shall be construed to 
     prevent the United States from taking any action which it 
     considers necessary for the protection of essential security 
     interests or from invoking its sovereign authority to define, 
     for purposes of exclusion from coverage under the 
     Shipbuilding Agreement and from any dispute or challenge 
     based on Annex I to the Shipbuilding Agreement, ``military 
     vessel'', ``military reserve vessel'', or ``essential 
     security interest'' on a case by case basis, as determined by 
     the Secretary of Defense.
       In paragraph (1) of section 209 (as redesignated by this 
     amendment), strike ``and `Shipbuilding Agreement vessel' have 
     the meanings given those terms in subsections (h), (i), and 
     (j)'' and insert `` `Shipbuilding Agreement vessel', and 
     `Export Credit Understanding' have the meanings given those 
     terms in subsections (h), (i), (j), and (k)''
       Page 6, strike line 19 and all that follows through page 7, 
     line 2.
       Page 7, line 3, insert ``(I) if'' before ``the 
     petitioner''.
       Page 7, strike lines 9 through 11 and insert the following:
       ``(II) if the petitioner was not invited to tender a bid, 
     the petition''.
       Page 7, line 19, strike ``(i)(III)'' and insert 
     ``(i)(II)''.
       Page 9, line 10, strike ``(i) or (ii)'' and insert 
     ``(i)(I)''.
       Page 9, line 18, strike ``(1)(B)(iii)'' and insert 
     ``(1)(B)(i)(II)''.
       Page 49, add the following after line 24:

     ``SEC. 809. THIRD COUNTRY SALES.

       ``(a) Filing of Petition.--Any interested party that would 
     be eligible to file a petition under section 802(b)(1) with 
     respect to a sale if such sale had been to a United States 
     buyer may, with respect to a sale of a vessel by a foreign 
     producer in a Shipbuilding Agreement Party to a buyer in a 
     third country that is a Shipbuilding Agreement Party, file 
     with the Trade Representative a petition alleging that--
       ``(1) such vessel has been sold at less than fair value; 
     and
       ``(2) the industry in the United States producing or 
     capable of producing a like vessel is materially injured by 
     reason of such sale.
       ``(b) Determination.--Upon receipt of a petition under 
     subsection (a), the Trade Representative shall request the 
     following determinations to be made in accordance with 
     substantive and procedural requirements specified by the 
     Trade Representative, notwithstanding any other provision of 
     this title:
       ``(1) The administering authority shall determine whether 
     there is reasonable cause to believe that the subject vessel 
     has been sold at less than fair value.
       ``(2) The Commission shall determine whether there is 
     reasonable cause to believe that the industry in the United 
     States is materially injured by reason of such sale.
       ``(c) Complaint by Trade Representative.--If the 
     administering authority makes an affirmative determination 
     under paragraph (1) of subsection (b), and the Commission 
     makes an affirmative determination under paragraph (2) of 
     subsection (b), the Trade Representative shall make 
     application to the country of the buyer of the subject vessel 
     for an injurious pricing action and relief similar to that 
     available under section 808. The Trade Representative shall 
     advise the petitioner of the proceedings undertaken by the 
     third country in response to such application and shall 
     permit the petitioner to participate in such proceedings to 
     the greatest extent practicable.''
       Page 102, line 9, strike ``or 808'' and insert ``, 808, or 
     809''.
       In the table of contents for chapter 8 of title VII of the 
     Tariff Act of 1930 (page 3, after line 9), insert the 
     following after the item relating to section 808:

``Sec. 809. Third country sales.''

       Page 100, line 20, strike ``and''; on line 21, strike 
     ``(iii)'' and insert ``(iv)'', and insert the following after 
     line 20:
       ``(iii) a military reserve vessel, and''.
       Page 101, insert the following after line 15:
       ``(E) Military reserve vessel.--A `military reserve vessel' 
     is a vessel that has been constructed with national defense 
     features and characteristics required by the Secretary of 
     Defense for the purpose of supporting the United States Armed 
     Forces in a contingency.

  The CHAIRMAN. Pursuant to the rule, the gentleman from Virginia [Mr. 
Bateman] and a Member opposed will each control 30 minutes.
  The Chair recognizes the gentleman from Virginia [Mr. Bateman].
  Mr. BATEMAN. Mr. Chairman, I ask unanimous consent that 15 minutes of 
the time allotted to me on the Committee on National Security be 
assigned to the gentleman from California [Mr. Dellums].
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Virginia?
  There was no objection.
  Mr. BATEMAN. Mr. Chairman, I yield myself as much time as I may 
consume.
  Mr. Chairman, my amendment will address a number of deficiencies in 
the underlying text of H.R. 2754. Again I wish to emphasize that my 
complaints with this agreement are not over the pros and cons of 
subsidizing this industry or any other industry. This is not a fight 
over subsidies. It is, however, a fight over the fairness of this 
agreement as it relates to our large domestic shipyards.
  This amendment will not make the agreement perfect, but it will 
negate to some degree its negative impact on the large shipyards which 
have been committed to building naval vessels.
  Let me explain how this agreement works from the perspective of our 
shipyards during the process of transitioning from 100 percent Navy 
work to a combination of Navy and commercial work. Take, for example, 
the title XI loan guarantee program which my amendment addresses. Under 
the agreement in H.R. 2754, as presently before my colleagues, the 
favorable terms are offered effective July 15, 1996. Current law, which 
my amendment seeks to retain for a period of 30 months, allows U.S. 
Maritime Administration to issue loan guarantees for the construction 
of vessels in U.S. yards. Those guarantees allow for a loan repayment 
period of up to 25 years and a downpayment required of 12.5 percent. 
Under this agreement this will change to a repayment term of only 12 
years and require a downpayment of 20 percent.
  In simple terms, the shipowner will have to pay off the mortgage 
twice as fast and will have to come up with almost double the 
downpayment if he chooses to build in a U.S. shipyard.
  The more favorable terms which my amendment seeks to retain for only 
30 additional months was the product of extensive debate between the 
House and the Senate during consideration of the fiscal year 1994 
defense authorization bill. The Senate had, at the urging of the 
administration, sought to adopt at that time the less favorable terms 
which we are being asked to adopt now. The House version recognized 
that if we were to offer any chance to our large U.S. yards to move to 
commercial ship construction, that we had to offer a program to 
encourage foreign purchases to at least give U.S. shipyards one 
competitive tool.
  The Committee on National Security was well aware that our foreign 
competitors had received literally billions of dollars annually in 
subsidies. We also knew that it would take more than 24 months to have 
our yards retooled and market a totally new product. Remarkably two of 
our shipyards, Newport News in Virginia and Avondale in Louisiana are 
making the transition having recently begun construction, thanks to 
title XI loan guarantees, on double-hull commercial tankers.
  It is important to keep in mind that our northern competitors have 
benefited from literally billions of dollars in subsidies over the 
years. As my colleagues can see from charts that we put before them, 
the annual average has exceeded $8 billion for our six major 
competitors. Our title XI program has amounted to an average of only 
$50 billion since fiscal year 1994.
  The advantage of my amendment is severalfold. It brings to an end 
subsidies. Yes, it is a compromise. It also recognizes that we cannot 
wish budgets, as tight as they are, to afford to get in subsidy battles 
with other nations. With the compromise here is that it recognizes that 
our foreign competitors were able to retain under the guise of 
restructuring a large package which lasts well into 1999.
  In other words, my amendment, as it addresses title XI, brings some 
measure of fairness to this agreement, fairness which our negotiators 
choose not to insist on. It is now up to the Congress to step up and 
correct the deficiency.

  Let me briefly respond to charges that this amendment will result in 
the agreement falling apart. Our negotiators are already at work 
getting an extension of the delivery date on vessels which are built 
using the title XI

[[Page H6317]]

guarantees. They have already gained a delay of 6 months from the 
original effective date.
  Now, I appreciate that they do not wish to approach our trading 
partners again but for what is, by any fair assessment, a very modest 
extension. However, it is the obligation and the duty of Congress not 
to accept every agreement that has been negotiated. We are not here to 
simply rubber stamp an agreement if we think it is wrong.
  Finally, my amendment corrects several other deficiencies, 
particularly as they relate to the Jones Act and DOD procurements. As 
presently drafted, this agreement may be used as a wedge against the 
Jones Act. The Jones Act requires that all merchandise transported to 
points in the United States must be carried on U.S.-registered and 
U.S.-built vessels. This agreement appears to allow foreign countries 
to retaliate against U.S. companies if U.S. shipbuilders construct more 
than 200,000 tons of Jones Act trade vessels annually for the first 3 
years. After 3 years, any construction creates a presumption that the 
rights and balances of the parties is upset and sanctions can be 
imposed.
  This part of the en bloc amendment simply assures that exemption from 
the Jones Act, which our trade negotiators tell us is consistent with 
the agreement even though the OECD representatives insist the Jones Act 
must go away. The U.S. Trade Representatives noted in our hearing that 
European Union interpretation of the Jones Act provisions were wrong. 
We are simply making it absolutely clear that nothing in this agreement 
affects the Jones Act. The Committee on National Security believes the 
changes to domestic law within the jurisdiction of the Congress and the 
imposition of penalties by foreign entities for compliance with the 
domestic statute is inappropriate. My amendment prevents this from 
happening. If our Trade Representative is correct and the Jones Act is 
not affected, my amendment clearly can do no harm. If they are 
incorrect, my amendment is critically needed. We should protect the 
Jones Act and do so, and to do so my colleagues should vote for my 
amendment.
  Last, my amendment would clarify that nothing in the agreement should 
be construed as preventing the United States from taking any action 
which it considers necessary for the protection of its essential 
security interests. This part of the amendment would allow the United 
States to invoke its sovereign authority to define for the purposes of 
exclusion from the agreement the terms, quote, military vessel, 
unquote, military reserve vessel, or, quote, essential security 
interests on a case-by-case basis as determined by the Secretary of 
Defense. This part of the amendment would prevent an international 
trade organization from defining what is or is not in the national 
security interests of the United States.
  Finally, this amendment would allow greater rights for U.S. 
shipbuilders to petition the U.S. Trade Representative if they believe 
other countries are selling ships at less than the cost to foreign 
countries.
  In conclusion, the Committee on National Security changes are modest, 
reasonable, and crucial. They will not bring down this agreement as the 
opponents would have us believe. If it does, it demonstrates the 
signatories are not seriously interested in ending shipbuilding 
subsidies, and if they are not so interested, then the agreement is 
worthless.
  I urge my colleagues' support if they believe it is important to 
preserve a strong defense industrial base that will be available if, 
God forbid, we ever need to mobilize our shipbuilders.
  Mr. Chairman, I reserve the balance of my time.
  The CHAIRMAN. Is the gentleman from Illinois [Mr. Crane] opposed to 
the amendment?
  Mr. CRANE. I am, Mr. Chairman.
  The CHAIRMAN. The gentleman from Illinois is recognized for 30 
minutes.
  Mr. CRANE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I am adamantly opposed to this amendment. If 
implemented, it would cause the agreement to disintegrate, leaving us 
with nothing but many wasted years. Make no mistake: the amendment 
violates the agreement in a fatal way. We have received letters from a 
number of our trading partners telling us that if this amendment is 
adopted, we will not have implemented the agreement and that they will 
not renegotiate the agreement. We cannot afford to have them walk away.
  Let me rebut the arguments raised by the supporters of this 
amendment. First, we do not need to eliminate our title XI program in 
order to comply with the agreement. We merely have to scale it back to 
meet the agreement requirements, just as our trading partners must. We 
will achieve balance instead of a war of escalation that we cannot and 
will not win.
  Second, our national security is completely protected under the 
agreement. The agreement contains an exception that allows a government 
to back away if it believes its national security interests are at 
stake. The Department of defense has also sent us a letter stating, and 
I quote, that ``the Agreement will not adversely affect our national 
security.'' This statement is powerful evidence that the agreement does 
not threaten our national security.
  Third, our negotiators were able to achieve an exception for the 
Jones Act, something no other country was able to achieve. Although I 
agree that the Jones Act is not affected, I do not believe that we need 
specific statutory language that says so. But more importantly, I 
believe that this amendment goes too far. I am concerned that we could 
potentially violate a whole series of agreements, let alone the 
Shipbuilding Agreement, by prohibiting such measures from taking 
effect. There is no need to put us at such risk. As the Defense 
Department stated in the letter I quoted earlier, the agreement ``does 
not change cabotage laws, that are clearly vital to our national 
security.''
  We have heard some discussion that the amendment represents a 
compromise position because there are some members that wanted even 
tougher language. Mr. Chairman, a serious violation is still a serious 
violation. Merely because the amendment keeps the current title XI 
program in effect for 30 months as opposed to a longer period of time 
does not change the fact that any extension of the current title XI 
program violates the agreement.
  Nor can it be said that the amendment merely extends the transition 
period. Let us not be naive. We would be asking for more benefits than 
we currently have but, at the same time, would be requiring our trading 
partners to implement all of the terms of the agreement immediately. 
But trade agreements do not work that way. We have to give up 
something, too. But the reality is that our shipyards will feel the 
pinch considerably less than our trading partners: Our $50 million in 
title XI loan guarantees compared to billions of dollars in foreign 
subsidies. And we do not even have to give up our $50 million. Instead, 
we just have to make sure that we do not make guarantees in a manner 
that violates the agreement.
  Let me read what our administration and some of our trading partners 
have said about the amendment. U.S. Trade Representative Charlene 
Barshefsky has stated:

       I want to make clear that the substitute amendment to H.R. 
     2754 approved by the National Security Committee * * * 
     modifies the legislation in ways that are clearly 
     incompatible with the agreement and unacceptable to the other 
     signatories.

  The EU Ambassador to the United States has stated:

       This amendment clearly is inconsistent with the terms of 
     the agreement as negotiated between the parties. * * * This 
     significant amendment would not be acceptable to the European 
     Community since it would be contrary to the basic objectives 
     and balance of mutual concessions contained in the agreement. 
     I cannot envisage the circumstances under which signatories 
     of the OECD agreement would be willing to reopen 
     negotiations. The adoption of the amendment would put the 
     agreement in serious jeopardy.

  The OECD has stated:

       If this amendment is attached to H.R. 2754 and passed by 
     the House of Representatives, the United States is putting in 
     jeopardy the entry into force of the Agreement.

  For all of these reasons, Mr. Chairman, let me be clear that a vote 
for the amendment is a vote against the agreement. Contrary to what the 
supporters are arguing, this amendment would not improve the agreement; 
it would destroy it. I urge my colleagues to join

[[Page H6318]]

together in a bipartisan effort to support our shipbuilding industry 
and to oppose the amendment.
  Mr. Chairman, I include the following information for the Record:
                                         Organisation for Economic


                                 Co-operation and Development,

                                              Paris, June 4, 1996.
     Hon. Herbert H. Bateman,
     House of Representatives,
     Washington, DC.
       Dear Congressman: I understand that the mark-up by the 
     House National Security Committee of HR 2754, a bill to 
     approve and implement the provisions of the 1994 ``Agreement 
     Respecting Normal Competitive Conditions in the Commercial 
     Shipbuilding and Repair Industry'' has led to an amendment by 
     yourself, among others, that would extend the provisions of 
     the present Title XI Loan Guarantee Program until January 
     1999, with the vessels constructed using these terms being 
     required to be delivered by January 1, 2002. It is clear that 
     this proposal will be in contradiction to the Agreement and a 
     breach of its provisions. As you know, the essential approach 
     to shipbuilding subsidization in the Agreement and a 
     guarantee of its effectiveness is equal treatment of all 
     Parties and quick elimination, i.e. by entry into force, of 
     all existing support measures.
       Let me therefore express my great concern that if this 
     amendment is attached to HR 2754 and passed by the House of 
     Representatives, the United States is putting in jeopardy the 
     entry into force of the Agreement.
       Failure to bring the Agreement into effect, though possibly 
     of some advantage for the US shipbuilding industry in the 
     very short-term, will be of great harm to it in the longer-
     term. Failure will, inter alia, prompt a resurgence of 
     shipbuilding subsidies in the other countries--which as you 
     know have severely affected the competitiveness of US yards 
     in the past. Furthermore, it would deprive the United States 
     shipbuilding industry of the tool to act against dumping in 
     the world shipbuilding market.
       I therefore urge you to reconsider your amendment as the 
     legislation makes its progress on the floor of the House of 
     Representatives. Strict and immediate implementation of the 
     Agreement seems to me to be the way of ensuring the long-term 
     viability of the shipbuilding industries in the United 
     States, as well as those of the other Parties to the 
     Agreement.
           Sincerely,
                                                      P.M. Olberg,
     Ambassador.
                                                                    ____

                                        European Union, Delegation


                                   of the European Commission,

                                     Washington, DC, May 31, 1996.
     Hon. Herbert H. Bateman,
     House of Representatives,
     Washington, DC.
       Dear Congressman: I am writing on behalf of the European 
     Commission to express our considerable concern with respect 
     to the amendment passed by the House National Security 
     Committee in its mark-up of the OECD shipbuilding 
     implementing legislation. The amendment calls for an 
     extension of the term of Title XI financing for ship 
     construction for thirty months. Furthermore the amendment 
     would clearly state that the agreement does not require 
     changes in the Jones Act and that certain Department of 
     Defense procurements are not covered.
       This amendment clearly is inconsistent with the terms of 
     the agreement as negotiated between the parties.
       The agreement is the result of five years of complex 
     negotiations which have led to the adoption of the basic 
     principles originally proposed by the United States (i.e. the 
     prohibition of virtually all forms of future government 
     subsidies). Therefore this significant amendment would not be 
     acceptable to the European Community since it would be 
     contrary to the basic objectives and balance of mutual 
     concessions contained in the agreement. I cannot envisage the 
     circumstances under which signatories of the OECD agreement 
     would be willing to reopen negotiations.
       The adoption of the amendment would put the agreement in 
     serious jeopardy. Therefore, I should like to urge you to 
     take the above into account in future consideration of the 
     bill.
           Sincerely Yours,
                                                      Hugo Paemen,
     Ambassador.
                                                                    ____



                                             Embassy of Japan,

                                     Washington, DC, June 5, 1996.
     Hon. Philip M. Crane,
     House of Representatives,
     Washington, DC.
       Dear Congressman Crane: Upon the instruction from my 
     government, I wish to draw your attention to an important and 
     urgent matter concerning the ``OECD Shipbuilding Agreement'' 
     (the Agreement respecting Normal Competitive Conditions in 
     the Commercial Shipbuilding and Repair Industry) which is to 
     be ratified by 15 June.
       Recently we were informed that the amendments of the 
     implementing bill, which would not be consistent with the 
     obligations under the Agreement, was made in a U.S. House 
     committee. We noted with surprise that such an action has 
     been taken in the U.S., which was the initiator and driving 
     force behind the negotiations of the Agreement.
       This Agreement was negotiated for several years and aims to 
     reach normal competitive conditions in the world commercial 
     shipbuilding and repair industry. We are gravely concerned 
     that amending the Agreement would, in fact, make it 
     impossible to enter into force. It would seriously undermine 
     the credibility of the U.S., if the Agreement, made by the 
     U.S. initiatives, would not enter into force due to the U.S. 
     failure to conclude it.
       In Japan, this Agreement was approved by the House of 
     Representatives on 31 May and is to be put to a vote in the 
     responsible committee of the House of Councilors in the very 
     near future. The implementing legislation was already 
     approved by the Diet on 5 June. Thus, we are approaching to 
     the goal in time for the target date of 15 June.
       I would like to invite you to review the above situations 
     and impacts and strongly encourage the U.S. to quickly 
     conclude this Agreement as it is.
           Sincerely,
                                                     ------ Saito,
     Ambassador of Japan.
                                                                    ____



                                      Royal Norwegian Embassy,

                                     Washington, DC, June 5, 1996.
     Hon. Charlene Barshefsky,
     Acting U.S. Trade Representative,
     Washington, DC.
       Dear Ambassador Barshefsky: I am writing to you to express 
     the Norwegian Government's grave concern regarding the 
     amendments passed by the National Security Committee of the 
     House of Representatives in its mark-up last week of the 
     legislation for implementation of the OECD Shipbuilding 
     Agreement.
       Several of the amendments, most notably the provisions for 
     extending the Title XI shipbuilding loan guarantee program 
     and the provisions for removing the applicability of the 
     Agreement with respect to the building of Jones Act vessels, 
     are clearly inconsistent with the terms of Agreement.
       The OECD Shipbuilding Agreement is the result of many years 
     of complex negotiations and represents a carefully crafted 
     compromise between the parties to the Agreement. My 
     Government holds the view that the Agreement is of vital 
     importance for the return to normal competitive conditions in 
     the commercial shipbuilding industry.
       Norway has ratified the OECD Agreement, and would find that 
     the introduction of amendments such as those proposed by the 
     National Security Committee would destroy the balance of 
     obligations and, thus, undermine the foundation upon which 
     the Agreement was built. On the Norwegian side, we do not 
     foresee circumstances whereby the signatories of the OECD 
     Agreement would be prepared to reopen negotiations.
       Hoping that you will convey to Congress Norway's concern 
     that adoption of the aforementioned amendments would 
     seriously jeopardize the OECD Agreement, I remain.
           Sincerely yours.
                                                 Karsten Klepsvik,
                                             Charge d'Affaires ai.

                              {time}  1200

  Mr. Chairman, I reserve the balance of my time.
  Mr. DELLUMS. Mr. Chairman, I yield 1 minute to my distinguished 
colleague, the gentlewoman from Oregon [Ms. Furse].
  Ms. FURSE. Mr. Chairman, I rise in strong support of the Bateman 
amendment. It is absolutely essential for our national security and the 
security of our economy that we continue to have a shipbuilding 
industry. It seems to me, Mr. Chairman, that there is no better public-
private partnership than the loan guarantee. I want to congratulate the 
gentleman from Virginia [Mr. Bateman] for having brought this 
absolutely vital amendment to us. I urge my colleagues to support it, 
both for the economy and for our national security.
  Mr. DELLUMS. Mr. Chairman, I yield 4 minutes to my distinguished 
colleague, the gentleman from Illinois [Mr. Lipinski].
  Mr. LIPINSKI. Mr. Chairman, I want to thank the gentleman from 
California for yielding this time to me.
  Mr. Chairman, as the former chairman of the Committee on Merchant 
Marine and Fisheries, or as the chairman of the late Committee on 
Merchant Marine and Fisheries, I rise today in very strong support of 
the amendment offered by the gentleman from Virginia [Mr. Bateman]. Mr. 
Bateman and I, when we had the Committee on Merchant Marine and 
Fisheries, worked very, very hard on behalf of the maritime industry. I 
am very happy that he has continued to do so over on the Committee on 
National Security, as I have tried to do on the Committee on 
Infrastructure and Transportation.
  Mr. Chairman, I commend the gentleman from Virginia and the other 
members of the National Security Committee for recognizing the need to 
improve the OECD Shipbuilding Trade Agreement to make it more equitable 
for the United States shipbuilding industry.
  The United States initiated negotiations for the OECD Shipbuilding 
Trade

[[Page H6319]]

Agreement 5 years ago in order to end the massive government subsidies 
that give foreign shipbuilders an unfair competitive advantage. 
Unfortunately, the final OECD agreement fails to meet the objective of 
eliminating foreign government shipbuilding subsidies. For instance, 
the agreement contains a major restricting loophole which European 
Governments are using to spend millions of dollars for the 
modernization of their shipyards. In fact, the French Government 
refused to even sign the agreement until it was allowed to spend $480 
million for such restructuring of its shipyards. In addition, United 
States trade negotiators agreed to grandfather certain subsidy programs 
by South Korea and Germany, which were initiated during the 
negotiations. Yet, the United States is expected to immediately 
depredate the title XI loan guarantee program for U.S. shipbuilders--
despite the fact that U.S. shipbuilders have not enjoyed a direct 
Government subsidy in over a decade.
  The OECD agreement is full of loopholes and exemptions that will 
benefit foreign shipbuilders. Moreover, the agreement does not even 
cover such major shipbuilding nations such as Poland, China, Taiwan, 
and Russia, allowing those countries to continue their direct and 
substantial subsidization of their domestic shipbuilding. Yet, the 
United States is expected to immediately reduce the current Title XI: 
Loan Guarantee Program. This will cause immediate harm to the U.S. 
shipbuilding industry.
  With Navy shipbuilding at an all time low, it is critical for our 
yards to secure commercial work. And, for the first time in 35 years, 
American shipbuilders are experiencing a resurgence in commercial 
business. These recently signed commercial contracts were made possible 
by the Title XI: Ship Loan Guarantee Program. Yet, the OECD agreement 
and the bill would bring a screeching halt to this resurgence by 
rendering the title XI program ineffective.
  A 30-month extension of the modest title XI, as provided in the 
Bateman amendment, is needed to give U.S. shipyards an adequate 
transition period to ensure their continued viability. This is a 
reasonable request when compared to the unfair competitive advantage 
subsidized foreign shipbuilders have enjoyed for the past decade--and 
will continue to enjoy in China, Poland, and other nonsignatory 
nations.
  This amendment is the absolute minimum we can, and must, enact. I 
urge my colleagues to support the Bateman amendment.
  Mr. CRANE. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
Washington [Ms. Dunn].
  Ms. DUNN of Washington. Mr. Chairman, I thank the gentleman for 
yielding time to me.
  Mr. Chairman, I rise in support of H.R. 2754 as approved by the 
Committee on Ways and Means, and to commend the chairman of the 
committee and the gentleman from Florida [Mr. Gibbons] for their 
steadfast work in securing enactment of this historic agreement.
  Unfortunately, in spite of their efforts, some individuals argue that 
no agreement is better than this agreement. In reality, if the Bateman 
amendment is adopted, that is exactly what we would have: No agreement.
  To all those people, I say, take off your blinders and recognize 
that, embodied in this agreement, is our best chance to revitalize our 
domestic industry. For years we have witnessed the continued decline of 
the U.S. shipbuilding industry at the hands of massive foreign 
subsidization. The remaining American commercial shipbuilders have 
become the most efficient in the world. Yet no amount of belt-
tightening could ever overcome the enormous subsidy margins provided by 
their foreign competitors.
  Over the past several years, many have expressed frustration with the 
negotiating of this agreement. I must say that while the road to this 
final agreement has been extremely difficult, I am confident that this 
agreement provides our domestic shipbuilders with the best opportunity 
to compete in a fair world market.
  If Members believe they are helping our domestic shipbuilding 
industry by voting for the Bateman amendment, let me tell the Members, 
I believe they are wrong. Our failure to pass this measure as approved 
by the Committee on Ways and Means will likely spur existing subsidies 
by our foreign competitors to record levels, and this would certainly 
be the final and fatal blow to our domestic shipbuilding industry.
  Mr. Chairman, I urge my colleagues to defeat the Bateman amendment 
and adopt this historic and sound international agreement.
  Mr. BATEMAN. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman 
from California [Mr. Cunningham].
  Mr. CUNNINGHAM. Mr. Chairman, I commend the loyalty of the 
gentlewoman from Washington [Ms. Dunn] to the chairman of the committee 
she serves on, but I believe she is wrong.
  Mr. Chairman, let me go to a little different direction. I truly 
believe that both under Republican and Democrat administrations, our 
State Department has been the weak link of this country. While we have 
strong militaries, the American worker can compete against any nation 
in the world, but yet our trade agreements which I supported, NAFTA and 
GATT, they have been treated very, very poorly as far as the 
administration of them. Who ends up paying for that? The American 
worker, Mr. Chairman.
  If we take a look in which title XI uses $50 million, why was it 
created in the last couple of years? Under OPA 90 we wanted to build 
dual hull tankers. There is no money to build ships in the United 
States, because foreign nations have subsidized by billions of dollars 
and cut on the west coast. NASCO is the only shipbuilder left on the 
west coast. We only built one ship in this decade, because foreign 
nations, with their cutthroat economic tactics, have cut and killed the 
American worker. So we established it not only to help the environment, 
so we could build tankers, but to neutralize that system.
  In the meantime, while we build one ship, they build 100. I cannot 
tell the Members just the economy of scale. If you build 100 ships, it 
is much cheaper to build those ships. They say let us do away with 
title XI, and that will neutralize this situation. No, it will not, Mr. 
Chairman, because they still have the advantage of all of these orders 
and all of these ships they are building, which makes our ships cost 
much more, which we cannot sell. All we are asking is to give us a 
level playing field.
  Mr. Chairman, I think for the first time this country has a chance to 
walk softly and carry a big stick. Let us approach this trade agreement 
for a change with a benefit to the American worker, not to the benefit 
of foreign trading interests. The President was right on his trading 
policies, but we have to get tough.
  Do Members think the Secretary of State, under either Republican or 
Democratic administrations, is going to push and support this? No, they 
are not. Let us support the American worker, let us support the Bateman 
amendment.
  Mr. CRANE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Florida [Mr. Deutsch].
  Mr. DEUTSCH. Mr. Chairman, the agreement that is really before us, 
the OECD agreement, is an agreement which I think all of us would 
argue, at least the concept of the agreement, will greatly benefit the 
United States of America. It would end the subsidies that other 
countries have been doing for years, the dumping that other countries 
have done for years to adversely affect the American shipbuilding 
industry.
  All we need to do is look at the facts on the ground in this country 
today, or the facts in the shipyards. Those facts are that the United 
States right now does not sell very many ships in terms of the world 
market, an infinitesimal percentage of those ships in the world market, 
because of the type of system that exists today and that this agreement 
is trying to end.
  Now in front of us, the Bateman amendment says, well, this agreement 
is going to adversely affect the defense of the United States of 
America, our national security. That is why we need the Batement 
amendment. I would reiterate what actually has been pointed out by the 
chairman of the subcommittee previously, the gentleman from Illinois 
[Mr. Crane], that the Defense Department, the Joint Chiefs, have 
obviously gone through this agreement, have sent correspondence to the 
chairman of the committee the gentleman

[[Page H6320]]

from South Carolina, [Mr. Spence] specifically, categorically stating 
that there would be no adverse effect. There is a specific national 
defense exemption that exists in the agreement.
  Mr. Chairman, I think it is really unfortunate to raise this issue, 
really almost as a scare tactic, versus what the facts are as based 
through the Joint Chiefs.

                              {time}  1215

  The other issue that I would raise is, it has been brought out, the 
whole issue that this is a jobs loss issue for the United States of 
America. Let us look at the facts. The facts are we are not producing a 
heck of a lot of jobs in terms of commercial production and, in fact, 
the commercial production that would exist, the potential for us to 
compete in that market is far greater than really any potential loss 
that exists.
  Mr. DELLUMS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, let me surface an issue that has not been dealt with 
and just put it on the table so we all can look at it. That is that 
this bill, there is joint jurisdiction on this piece of legislation.
  The tragedy of this institution is that we tend to get caught up and 
see the world in very narrow terms, and that is through the narrow 
prism of our committee jurisdiction. But someone was wise enough, Mr. 
Chairman, to refer this bill to two committees.
  I would hope that the process would allow us to bring together the 
perspectives and the perceptions of both committees in the hope that in 
joining those two perceptions, we will arrive at the wisest decision, 
so we do not get caught up in knee-jerk responses on the basis of a 
committee jurisdiction. I do not know taxes. I am not on Ways and 
Means. But I will debate anyone in this town on national security 
matters, because that has been my job for 25 years here.
  We looked at this bill. Where are we in agreement? First, that this 
is a maritime nation. Second, that we need to stimulate shipbuilding. 
Third, that we need to stimulate commercial shipbuilding. Fourth, 
that American workers and shipbuilders believe that it is in their 
mutual self-interest to end government subsidies of shipbuilding. So 
let us take that off the table. We all agree with that, so we do not 
have to sword fight over these issues.

  Where is the area of disagreement? The area of disagreement is that 
we believe that this agreement is flawed with respect to its transition 
implications. When speaking to the persons that negotiated the 
agreement, they admitted that they never sought transition assistance 
to the American shipbuilding industry.
  Did other countries do it? The answer is yes. I repeat, and 
underscore for the purposes of emphasis: Spain, $1.4 billion in 
restructuring aid; Portugal, $110 million in restructuring aid; 
Belgium, $74 million in restructuring aid; South Korea, restructuring 
aid, we believe that that amount is somewhere around $750 million plus 
bailout guarantees to the Daewoo shipbuilding industry.
  France, unknown total amount at this time, but we know minimally $480 
million. Special offers are currently being made by other members of 
the European Community to gain France's support for this agreement. 
Germany, a package to modernize, restructure, and cover losses of 
shipyards in the former East Germany.
  So some other Nation's negotiators looked at transition, and these 
subsidies that I spoke to were granted to January 31, 1999, Mr. 
Chairman. So somebody saw the need for transition.
  We are being asked to ratify an agreement, as I have said on more 
than one occasion today, and we have a responsibility to bring our 
intellectual capacity, our economic understanding and our political 
prowess to this situation and make the best decision. We tend to engage 
in hyperbole around here. ``Killer amendment.'' I have not seen 
anything die in the 25 years I have been around here, and I have gone 
after some things to try to kill them, so that is a bunch of hyperbole, 
Mr. Chairman.
  As I said before, the world wants this agreement, we want this 
agreement, I want this agreement, the shipbuilders want the agreement, 
and thousands and thousands of American workers want this agreement. 
They are the stakeholders. But when they looked at the agreement, they 
said, ``Hey, fellows, what about the transition? What about us until 
January 1999?'' All the Bateman amendment does is says, ``Here is some 
transition assistance, 30 months.''
  Loan guarantee program. Where were all the people around here when we 
put in this loan guarantee program and fought to get a measly $50 
million in loan guarantees for an economic conversion program because a 
lot of people said, ``Wait a minute, you're spending DOD dollars to 
stimulate commercial shipbuilding development?'' We said that if we do 
not build some kind of ships, we are going to lose our industrial base.
  That is why we have a National Security Committee. That is why we 
have Ways and Means. We study certain things, but our collective 
perception is where the great wisdom is.
  We are simply saying that this is an important agreement, it is a 
wonderful agreement. I have complimented the gentleman from Florida and 
I said, without equivocation, I am one of his greatest fans on the 
floor of this Congress. There is no finer person in this institution.
  I am simply saying that my point of departure is on the basis of the 
problems that it gives our American shipbuilding industry in the 
transition, and our American workers, who are extremely sensitive to 
these issues. They have all communicated with all of us here and said, 
``We want the agreement, the intent makes sense, but in the transition, 
we feel disadvantaged.''

  I do not think this agreement dies, because there is an imperative 
larger than this amendment. It is the world community coming together. 
But we can enter that stage, that world stage, as rational and 
intelligent people and say, just as these other nations did in their 
restructuring aid, that we can restructure as well.
  That is what this gentleman's argument is all about, not to kill the 
agreement. That would be stupid. It would be bizarre. It would be 
extreme. It would be self-defeating. But it would seem to me to allow 
it to go forward when other nations continue to have this kind of 
extraordinary advantage to January 1999 stabs at the agreement, the 
very people we choose to help, the American shipbuilding industry, the 
American worker, and at the end of the day the American citizen, 
because we are a maritime Nation.
  That is this gentleman's argument, so I am not trying to engage in 
any scare tactics, but I would make this point. We have six major 
shipbuilding industries, and when Ronald Reagan was spending $300 
billion a year on the military budget, everybody was building ships, 
they were coming out of our ears. That day is over. There is no such 
thing as a 600-ship Navy anymore. The gentleman from Mississippi 
pointed out we are moving toward a 150-ship Navy.
  So if we are not going to build naval ships because we are cutting 
the military budget, we have got to build some other kind of ships to 
keep this going, keep these people working, keep the economy moving. It 
is in the area of commercial ships, in a post-cold-war environment, 
where our future lies. So we want to see this agreement, but we want to 
see the transition period speak to us as eloquently as this 
restructuring speaks to these other countries that are moving toward 
signing this agreement.
  A final point. One of my colleagues said that this amendment would 
violate the agreement. We cannot violate anything that we have not 
agreed to as yet. That is why we are here, to use our brains, to use 
our ingenuity, to use our competence to decide how and what we will 
agree with.
  I hope my colleagues will join me in overwhelming support of the 
Bateman amendment, overwhelming support of the American shipbuilding 
industry, overwhelming support of the hundreds of thousands of American 
workers who desperately need us to do this, and overwhelming support 
for a transition period that speaks to the dignity of the respect and 
the reality of the American shipbuilding industry.
  Mr. Chairman, I reserve the balance of my time.
  Mr. CRANE. Mr. Chairman, I yield 2 minutes to the gentleman from Ohio 
[Mr. Sawyer].

[[Page H6321]]

  Mr. SAWYER. Mr. Chairman, the comments of our colleague from 
California are eloquent as always. I take a back seat to no one in my 
admiration of the work that he has done in the interests of economic 
conversion. Nothing could be more important to the economy of this 
Nation.
  Mr. Chairman, in many areas, American industries and their workers 
have had to complete against heavily subsidized European firms. Even 
where the gap between the level of subsidies has been the greatest--
most notably in the areas of aerospace and agriculture--American 
industries have largely been able to overcome this added challenge.
  However, in shipbuilding, American firms have simply been at too 
great a disadvantage. We have two choices of actions to address this: 
complete by enacting--and inevitably increasing--our own subsidies, or 
use our economic leverage to convince our trading partners to reduce 
their own subsidies.
  As public sector deficits have emerged as an increasing drag on the 
economies of all nations, those partners have seen the advantages of 
reducing their spending on subsidies. That is part of the reason we 
have this agreement before us today.
  We must also recognize the reality that we cannot afford a subsidy 
war. The continuation of the title XI program unchanged for another 3 
years, as the Bateman amendment would accomplish, will not alter that 
fact. It will only convince our trading partners to resurrect the 
subsidies that have crippled our ability to compete in the past.
  The complexities and challenges of international competition will 
continue to cause pain and disruption in this country and across the 
world. But when we can convince other nations to level the 
international playing fiend, the opportunities of trade become that 
much more apparent. The decision we face today is between seizing such 
an opportunity or hanging on to the vestiges of a disappointing past. I 
urge my colleagues to oppose the Bateman amendment and support the 
bill.
  Mr. BATEMAN. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from Maine [Mr. Longley].
  Mr. LONGLEY. Mr. Chairman, I will be supporting the Bateman 
amendments, but I also want to make clear that I do not think the 
shipbuilding agreement itself is the solution. It will in all 
likelihood make much more difficult if not impossible U.S. 
shipbuilders' pursuit of commercial shipbuilding orders in the 
international market.
  This agreement is fatally flawed in that it permits other governments 
to continue direct subsidy shipbuilding payments to their yards until 
1999 as long as those subsidies are committed by the end of this year. 
The last direct U.S. commercial subsidy program was unilaterally 
terminated by our Government in 1981, a full 15 years ago. I find it 
appalling that U.S. negotiators took part in formulation of an 
agreement in which numerous exceptions are granted to specific 
subsidizing foreign governments totaling billions of dollars. How this 
combination of provisions does anything other than make the 
international commercial playing field even more lopsided against 
unsubsidized American shipbuilders escapes me.
  A French shipyard received a subsidy package in the range of $480 
million after the agreements were concluded and our negotiators had 
returned home. That event alone should have provided more than ample 
grounds for our Government to insist on reopening the negotiations for 
the purpose of gaining more equitable treatment for the unsubsidized 
U.S. industry. Other subsidies are actually provided for in the 
agreement, including subsidies to Spain, Portugal, and Belgium.
  It is unfortunate, to say the least, that the administration chose to 
ignore this information and not respond favorably last December to the 
formal request of the six major U.S. shipbuilders which represent 95 
percent of all active American shipbuilding workers that the United 
States not sign the agreement in its present form.
  I will support the Bateman amendments but I will also oppose final 
passage. Bateman will fix some of the weaknesses in the bill, but, by 
the same token, they do not go far enough.
  Mr. CRANE. Mr. Chairman, I yield 2 minutes to the gentleman from New 
Mexico [Mr. Richardson].
  (Mr. RICHARDSON asked and was given permission to revise and extend 
his remarks.)

                              {time}  1230

  Mr. RICHARDSON. Mr. Chairman, I speak as a 14-year member of the 
Democratic Party with a 90-percent labor voting record. The AFL-CIO has 
been mentioned here. Yes, they are opposed, but let me state that their 
opposition stems from following the lead of the big Navy-oriented 
yards.
  Mr. Chairman, while 80 percent or more of total employment in 
shipbuilding is in these big yards, these yards primarily build Navy 
ships, not commercial ships. Over 90 percent of commercial ships are 
build in yards other than these Navy yards. The bill does not affect 
military ships. The big Navy yards are hopeful for big new subsidies 
for commercial ships. That is very enlightening. Jobs would be created 
for commercial yards to build more, but they cannot compete with the 
much larger subsidies from foreigners.
  Foreign subsidies are more than $4 billion. U.S. subsidies are $50 
million. This is the reason for the agreement to eliminate these 
subsidies, so we can create more American jobs, so our shipbuilders are 
more active and can compete more. The agreement would eliminate these 
unfair subsidies that we cannot compete with.
  This is a good bill, this is an amendment that would violate the fair 
trade agreement.
  Significant growth is projected for the highly competitive 
international shipbuilding market, while domestic military and 
commercial markets are expected to be small. The commercial 
shipbuilding market is projected to be $265 billion for the period 1992 
to 2001.
  American shipbuilders are being squeezed out of this market by heavy 
foreign government shipyard subsidiaries. This agreement eliminates 
those subsidies and allows the American builders to compete on a level 
playing field with the major shipbuilding countries of the world.
  We are in the midst of tight fiscal pressures to reduce our own 
spending, we cannot compete with major industrialized nations in a race 
to subsidize our shipping industries.
  The United States must take the lead in implementing this agreement. 
It will signal our commitment to freer markets to the international 
community. The strength of U.S. industry is its ability to compete. 
This agreement will give American shipbuilders the opportunity to 
expand operations and increase their production.
  International leadership requires courage and vision. Let's 
demonstrate to the world that we are looking forward and embracing the 
principles that have made America great.
  Mr. STUDDS. Mr. Chairman, will the gentleman yield?
  Mr. RICHARDSON. I yield to the gentleman from Massachusetts.
  Mr. STUDDS. Mr. Chairman, I thank the gentleman for yielding to me, 
and I want to associate myself with his remarks and rise in opposition 
to the amendment and in support of the bill.
  Let me say sadly and somewhat soberly that we have been here before. 
In the early 1980's, this country decided that it could no longer 
afford to and no longer wished to try to compete with the subsidies of 
foreign nations for the construction of vessels. We withdrew and, 
ironically, this agreement before us, the ratification of it, is a 
result, ultimately, of a suit brought under our own trade laws by our 
own shipbuilding industry, which concluded they could not possibly win 
a battle of competition with the subsidies of foreign nations.
  We cannot afford to go back there. I think in the long run our best 
bet is a world without these subsidies and, therefore, I complement the 
gentleman and join him in his remarks.
  Mr. CRANE. Mr. Chairman, I yield myself such time as I may consume.
  The gentleman from Virginia [Mr. Bateman] stated earlier that because 
the USTR is reopening the agreement to add 6 months to the delivery 
date, that it can renegotiate to permit us to retain title XI. And I 
want to explain to colleagues that is not correct. It will be 
impossible to reopen the agreement, as Mr. Bateman suggests.
  The agreement currently provides that no subsidies may be awarded 
under the agreement after the effective date of the agreement, July 15. 
Subsidies may be granted before that point as long as the vessel is 
constructed by December 31, 1998. The signatories had originally agreed 
that the agreement would take effect on February 1, 1996. That date had 
to be delayed 6 months because the United States was not

[[Page H6322]]

ready to implement. However, the December 31, 1998, delivery date 
remained in place.
  The administration is merely seeking a change applicable to all 
countries that would extend the delivery date 6 months to match the 
delayed starting date. The administration is not renegotiating the 
agreement. This change can be made merely through an understanding.
  Our trading partners appear to be willing to discuss this limited 
change that applies to all countries equally. However, our trading 
partners have told us that they will not renegotiate the agreement 
under the terms set forth in the Bateman amendment because it would 
destroy the balance in the agreement and give the United States an 
undue advantage.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BATEMAN. Mr. Chairman, I yield 2 minutes to the gentleman from 
California [Mr. Hunter].
  Mr. HUNTER. Mr. Chairman, I thank the gentleman for yielding me this 
time. I want to make a couple of closing remarks, first to my friend, 
the gentleman from Illinois [Mr. Crane], a dear friend and one of the 
real leaders in this Congress with respect to trade. I know that the 
President's, the Clinton administration's appointees in the Pentagon 
have said there is no threat to national security. They also told us 
the other day and repeated in a statement there is no threat to this 
country in terms of incoming ballistic missiles. Both of us disagree 
with the second statement that they made, and I think we should both 
disagree with the first statement they have made.
  Mr. Chairman, I want to remind my colleagues that all of the nations 
which are signatories to this agreement, all the major nations that are 
asking us to give up our national shipbuilding program, are nations 
that in this century have been saved militarily or protected militarily 
by America's national shipbuilding program. They will wait for us to 
work this agreement and make it right before they sign it.
  Second, my colleagues, this is a sovereignty issue. We are doing the 
same thing we did in the World Trade Organization, where we are giving 
up the right to a foreign judge to decide what is a military program. 
And I would just remind Members that the latest World Trade 
Organization ruling under WTO, in which foreign judges said Brazil and 
Venezuela can send dirty gas into the United States and, in the absence 
of that, retaliate against Americans, because they said that our 
environmental laws were in conflict with the World Trade Organization's 
ideas of what those laws should be. We will see exactly the same thing 
here because these foreign tribunals reserve to themselves the 
definition of what is an American military shipbuilding program.
  This is a sovereignty issue. Every single conservative should vote 
against the bill and for the Bateman amendment because it fixes some of 
those sovereignty problems on that basis. This is also predominantly a 
national security issue. I would hope that when national security goes 
head to head with economic considerations, national security with 
respect to maritime power should predominate. Please vote for the 
Bateman amendment.
  Mr. CRANE. Mr. Chairman, I yield myself such time as I may consume.
  On the question of whether the agreement unfairly disadvantages the 
United States, let me reassure colleagues that other countries are not 
permitted to transition, as the gentleman from California [Mr. Dellums] 
had earlier suggested. The agreement does provide for some existing 
shipbuilding restructuring programs to be phased out in Spain, 
Portugal, and Belgium; however, these programs are primarily for the 
express purpose of reducing capacity in the respective shipbuilding 
industries of these nations, not for expanding the industry or 
supporting specific ship construction activities.
  The precise terms of these programs, the amounts of funding, the 
purpose and deadlines for completion of these programs are spelled out 
in the agreement. The downsizing of European shipbuilding capacity is 
in the best interest of this Nation and the United States shipbuilding 
industry and should be encouraged. The special provisions result in an 
advantage, not a disadvantage to United States shipbuilders that wish 
to compete in the world shipbuilding marketplace.
  No other countries have received special deals. Without the OECD 
agreement there would be no way to monitor or control these programs. 
They could continue indefinitely at any level of funding for whatever 
purpose they chose. The Bateman amendment would not provide us with 
transition; it would completely and unequivocally kill the agreement 
and all we have achieved.
  Mr. Chairman, I reserve the balance of my time.
  Mr. DELLUMS. Mr. Chairman, may I inquire as to the remaining amount 
of time on either side?
  The CHAIRMAN. The gentleman from California [Mr. Dellums] has 1\1/2\ 
minutes remaining; the gentleman from Virginia [Mr. Bateman] has 2 
minutes remaining; and the gentleman from Illinois [Mr. Crane] has 
14\1/2\ minutes remaining.
  Mr. DELLUMS. Mr. Chairman, I yield the balance of my time, 1\1/2\ 
minutes, to my distinguished colleague, the gentlewoman from Ohio [Ms. 
Kaptur].
  Ms. KAPTUR. Mr. Chairman, I thank the gentleman for yielding me this 
time and I rise in strong support of the Bateman amendment and want to 
talk a little bit with the membership about why the agreement without 
this amendment is so flawed.
  The agreement essentially will not end foreign subsidy and dumping 
practices, it will, however, kill the recent rebirth of commercial 
shipbuilding in our country. It will eliminate thousands of highly 
skilled jobs in our shipyards and in the thousands of industries 
throughout 46 States which supply our shipyards.
  While our Trade Representative was at the negotiating table, it is 
important to point out that South Korea announced a $750 million 
bailout of its Daewoo Shipyard, which has been dumping ships on the 
world's market; Germany granted a $4 billion shipyard modernization 
subsidy to its shipyards, monies which are still being disbursed.
  Our negotiators agreed to grandfather these special subsidies, and 
though our trade negotiator maintains that restructuring is supposed to 
be tied to closure of facilities and associated worker restraining, 
that is not how foreign governments see it. In fact, Spain is spending 
$723 million to modernize all of its existing facilities with no 
closures planned.
  Further, the overall agreement fails to discipline the ship dumping 
practices of Japan and South Korea, and even though China has just 
begun to target shipbuilding as a means to develop its manufacturing 
industries, China is not a signatory to this agreement, nor is Poland, 
nor is Russia.
  So what did America get out of this deal? Nothing. What did American 
shipbuilders get out of this deal? Nothing. And what did American 
workers get out of this deal? Nothing. In fact, our negotiators agreed 
to immediately gut the modest title XI ship loan program that is 
included in the Bateman amendment. So without the Bateman amendment we 
will kiss more U.S. shipyard jobs goodbye.
  Mr. Chairman, I urge my colleagues to support the Bateman amendment 
and, without its inclusion, to oppose the bill.
  Mr. BATEMAN. Mr. Chairman, I yield myself the remainder of my time, 
and say in closing the debate on behalf of the Committee on National 
Security that it is passing strange to have heard my amendment referred 
to as reasonable on its face and modest, and at the same time be told 
that we are going to unravel an agreement and that we are violating an 
agreement.
  Mr. Chairman, we will not be violating an agreement. What we are 
contemplating is essentially a proposed agreement until and unless this 
Congress, in the exercise of its sovereign right for the people of the 
United States, determines that this is an agreement that should be 
implemented.
  My amendment, contrary to some who would have me taking a position of 
total opposition to any agreement, is a midpoint. It simply says there 
are flaws in this proposed agreement which had been identified, and, in 
the interest and protection of American shipbuilding because of its 
importance to American national security, need to be modified.
  If the other nations who purport to be in agreement on this agreement 
are

[[Page H6323]]

unwilling to accept these modest transition provisions, it speaks 
volumes to me as to whether or not they were seriously interested in 
ending shipbuilding subsidies. I am. We should be.
  This is not about doing that. This is about modest, reasonable 
transition provisions in protection of the core American shipbuilding 
capability, which is absolutely essential to our national security. And 
it is those shipyards and the workers in those shipyards and the 
merchant mariners who man American ships, and because of the importance 
of that merchant marine to the United States, that ask that Members 
vote for the Bateman amendment.
  Mr. CRANE. Mr. Chairman, I yield the remainder of my time to the 
gentleman from Florida, Sam Gibbons, our distinguished ranking minority 
member for closing remarks, and I want to pay tribute to him again as 
the man who served for so long as chairman of the trade subcommittee on 
which I served in my ranking minority position. We have worked 
collegially for years together and I pay tribute to this great man from 
Florida.

                              {time}  1245

  Mr. GIBBONS. Mr. Chairman, I thank the gentleman from Illinois [Mr. 
Crane] and others of my colleagues who have recognized my service here, 
and I want to say to them I close this debate with certainly no 
personal rancor toward them or to the cause that they advocate.
  I am here to give the best of my knowledge to the Members of this 
House, and the best of my judgment about the outcomes of actions we may 
take, what will follow.
  Mr. Chairman, over the years, ever since World War II, the United 
States has been backing out of the subsidy in shipbuilding. Through the 
1950's and the 1960's we cut back on our appropriations to commercial 
shipbuilding subsidies. Through the 1970's we did the same thing, and 
finally in the 1980's, under a procedure here on the budget 
reconciliation bill, the minority, together with some Members of the 
majority, got control of the situation through the Gramm-Latta 
substitute and actually abolished all the shipbuilding subsidies they 
could find. So since the 1980's the United States has had absolutely no 
shipbuilding subsidies of any consequence.
  Now, as I sat here attentively listening to this debate today, I had 
been hoping that I would find something that I had not heard before 
that perhaps I could respond to or answer a question about.

  Now, I know that negotiations are a tedious process. I participated 
in the launching of these negotiations many, many years ago. The 
negotiations have actually gone on for more than 5 years. Prior to 
that, I met with all of the shipbuilding industry in the United States. 
They all, because of my responsibilities, came by to see me. I sat down 
with them all in my office over here in the Rayburn building and we 
agreed to launch these negotiations.
  Now, as I hear these negotiations discussed, I would have to believe 
that they were not even a party to the negotiations, but they sent 
representatives to these negotiations that sat there with our 
negotiators and participated in all of these negotiations. Nobody was 
surprised about anything that was brought up. They would come back from 
these negotiations and come to see me and we would discuss these 
points.
  Mr. Chairman, I started unilateral U.S. action against these 
countries because at first they would not even negotiate with us on 
this. They would just come to the sessions and say no. Finally, they 
got concerned enough about the actions of Congress here to come to the 
negotiations and really truthfully begin the negotiations, and 5 
tortuous years of negotiations took place.
  During those 5 tortuous years, everybody in the shipbuilding industry 
had somebody around the negotiating table there to kibitz and to add 
their suggestions as to what should be done. Concessions were made back 
and forth. Deals were entered into and agreed to. Finally, all of these 
mutual concessions and negotiations came to an agreement.
  I celebrated, as did the shipbuilding industry at that time, because 
we thought we had a good agreement and I believe we still do have a 
good agreement.
  One thing was overlooked. The Committee on National Security found 
and rejuvenated an old, old subsidy that goes back to 1936; one that 
had been overlooked in the 1981 abolishment of all subsidies. Perfectly 
all right.
  Under the standstill agreement that is a part of the general 
agreement we are talking about here today, all countries agreed to 
stand still and not to go out and create new additional subsidies, and 
this little subsidy for $50 million that the Committee on National 
Security found qualified as one of those that could still be used. So, 
Mr. Chairman, some of our yards got a little jump out of that.
  But tomorrow, Mr. Chairman, June 15, is the deadline for us to take 
affirmative action on this agreement. If we do not take affirmative 
action in this House today to ratify this agreement, all of the other 
nations that have agreed to this agreement will back out of it. They 
have not just told us that; they put it in writing, and it is in 
yesterday's Congressional Record there for my colleagues' examination.
  Now, I know my friend, the gentleman from California [Mr. Dellums], 
believes that they will come back to the negotiating table. Well, I do 
not have the optimism that he has. Perhaps my lack of optimism is 
caused by having followed this agreement so closely over the years. All 
of these other nations are having trouble with their own shipbuilders, 
and the only reason they are standing still is because their word is 
good. But once we back out of the agreement, I do not see them coming 
back to the negotiating table to do what the gentleman from Virginia 
[Mr. Bateman] wants to do here.
  Mr. Chairman, let me say this. This agreement was negotiated with 
everybody participating. Every American shipbuilder in the United 
States had an opportunity and most of them did participate in this 
agreement. It was an agreement that had concessions on all sides. On 
our side, the Jones Act people put up a good case, and every other 
nation on Earth that participated in this agreement got rid of their 
so-called Jones Act subsidies or protection except the United States. 
We got a concession there. But a resulting concession had to come in, 
and that is that the Jones Act people, acting under the protection that 
they get from the Jones Act, would not take the economic advantage that 
they got from their Jones Act protection and go out and get a double 
dip under the international marketplace agreement that was negotiated 
here. That is all that is involved here.
  Now, the Department of Defense has signed off on this agreement. They 
followed the negotiation, both Republican and Democratic 
administrations. They have been a part of it. They know the 
consequences of it, and they are not concerned about it at all. The 
letter from the Secretary of Defense is also in the record.
  So, Mr. Chairman, this is not a national security issue; it is an 
economic issue for America. We stand on the verge of entering into the 
international shipbuilding market for the first time since 1981. If we 
do not take this advantage, we are going to lose a lot of jobs that we 
already have in the United States, and we are not going to take the 
opportunity to get the new jobs that are coming about because of the 
rapid obsolescence of the world's merchant marine fleet. American 
shipyards are competitive. They can compete against the best shipyards 
around the world. Our labor costs are low. Let me repeat that: Our 
labor costs are low and our technology is high.
  What has defeated us all these years is that all of the other nations 
on Earth continued their subsidies, continued their unfair pricing, and 
we sat with our hands tied. Do not let us go down today with our hands 
continually tied behind us. Give our yards an opportunity to get out 
and compete.
  Shipbuilders from all over the United States have come and talked to 
me about, ``Mr. Gibbons, if we could only get there subsidies ended, we 
can compete. But if we cannot end these subsidies right now, we are 
going to have to go on welfare.''
  Now, that is not fair. There are many conflicting interests in all of 
this in the United States, and I respect everyone's interest in this. I 
accuse no one

[[Page H6324]]

of any unfair, undemocratic practices. But the problem is we have got a 
once-in-a-lifetime opportunity to get rid of these pernicious worldwide 
subsidies. If we do not do it now, the Record already reflects that our 
trading partners will back out. We cannot afford to do that.
  It is really bigger than this shipbuilding issue. Ever since I have 
had a responsibility for monitoring our international trade 
negotiations, the rest of the world is structured politically different 
than we. No one has a Congress or a lawmaking body that is as powerful 
and as intrusive in the process as the Congress of the United States, 
and all of the rest of the world understands that and knows that.
  That is the reason why they will not deal with us on any kind of 
international agreement unless we have what we call fast track. A 
horrible misnomer, but I think all of us know what it is. They accuse 
us time and time again, in all international negotiations, of coming 
back to the House floor and the Senate floor and unraveling all of the 
mutual concessions that were made in the agreement.
  That is really what we are doing here today. I know we do not 
recognize it but they recognize it. They are resisting that, not only 
because of shipbuilding but because of all of the other negotiations 
that they have carried on with us and will carry on with us over the 
period of time.
  So this is a big issue. It is a big issue about how we organize a 
peaceful world, a world that lives under law, a world that lives under 
law openly developed and put forward and negotiated and agreed to by 
the different bodies of this country.
  Certainly the Committee on National Security has a role in all of 
this. I guess I regret as I stand here now that they probably were not 
involved in it enough during the negotiating process. I am sorry I did 
not call it to their attention. But I though that all of the 
shipbuilders in this country, particularly the large Navy yards that 
are so dependent on national security contracts, were keeping in touch 
with their other Members of Congress. I can tell my colleagues that I 
spent a lot of other time with them, time that I could have better 
spent on Florida concerns rather than on national concerns.
  So believe me, we have got an opportunity here today. We have got an 
opportunity to get a good agreement. This is the best agreement that 
American negotiators, including the private sector in all of these 
negotiations, could work out in 5 tortuous years. Four sets of 
negotiators, Republican and Democrat. We wore out in these 
negotiations. We cannot go back and undo all of that again because of 
these rather last-minute concessions.
  At best, if the Bateman amendment succeeds, it will last until 
Monday. It will last until Monday, and then it is gone, because it is 
only protected by the standstill agreement that is in this basic 
agreement. The other nations have told us, ``If you are not going to 
agree to it, we are not going to stand still,'' and they will meet and 
match on Monday the Bateman amendment subsidy, and there will be no 
more advantage, as temporary as it is, for the United States under the 
Bateman amendment. That is what all of this is about.
  This is perhaps my swan song on trade. I may have a few words on some 
other things around here before my term expires, but I want to thank 
the Members of Congress for listening to me, and I want to thank you 
also for this opportunity to participate.
  Mr. CRANE. Mr. Chairman, I yield 30 seconds to the gentleman from 
Alabama [Mr. Callahan].
  Mr. CALLAHAN. Mr. Chairman, I just want to echo what the gentleman 
from Florida [Mr. Gibbons] was talking about, and to tell the gentleman 
that the day has already arrived.
  Mr. Chairman, just yesterday in my district, a press release came 
from the Alabama shipyard, and it is based upon whether or not this 
agreement is enacted, where they signed a contract for five Russian 
tankers to be built in the State of Alabama. We are talking about 600 
new jobs.
  Mr. Chairman, I chair or have chaired for the past 8 years, the 
revitalization of the shipbuilding industry in this country. This is 
the biggest thing that we have going for us. We are now here. We 
already have achieved contracts, created jobs. If we turn this back, 
then we are going to lose American jobs.
  So, Mr. Chairman, I would encourage my colleagues to vote against the 
Bateman amendment and encourage them to support the bill once the 
Bateman amendment is rejected.
  The CHAIRMAN. All time has expired.
  The question is on the amendment offered by the gentleman from 
Virginia [Mr. Bateman].
  The question was taken; and the Chairman announced that the ayes 
appeared to have it.


                             recorded vote

  Mr. CRANE. Mr. Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 278, 
noes 149, not voting 7, as follows:

                             [Roll No. 237]

                               AYES--278

     Abercrombie
     Ackerman
     Andrews
     Baesler
     Baker (LA)
     Baldacci
     Ballenger
     Barcia
     Barr
     Barrett (WI)
     Bartlett
     Bateman
     Becerra
     Bilirakis
     Bishop
     Bliley
     Blute
     Boehlert
     Bonior
     Borski
     Boucher
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant (TN)
     Bryant (TX)
     Burr
     Burton
     Buyer
     Calvert
     Chambliss
     Chenoweth
     Clay
     Clayton
     Clement
     Clyburn
     Coburn
     Coleman
     Collins (IL)
     Collins (MI)
     Condit
     Conyers
     Cooley
     Costello
     Coyne
     Crapo
     Cummings
     Cunningham
     Danner
     Davis
     Deal
     DeFazio
     DeLauro
     Dellums
     Diaz-Balart
     Dickey
     Dingell
     Dixon
     Doggett
     Dooley
     Doolittle
     Dornan
     Doyle
     Duncan
     Durbin
     Edwards
     Ehrlich
     Emerson
     Engel
     Eshoo
     Evans
     Ewing
     Farr
     Fattah
     Fazio
     Fields (LA)
     Fields (TX)
     Filner
     Flake
     Flanagan
     Foglietta
     Forbes
     Ford
     Fox
     Frank (MA)
     Franks (CT)
     Franks (NJ)
     Frost
     Funderburk
     Furse
     Gallegly
     Gejdenson
     Gekas
     Gephardt
     Geren
     Gilman
     Gonzalez
     Goodlatte
     Goodling
     Gordon
     Graham
     Green (TX)
     Greenwood
     Gunderson
     Gutierrez
     Hall (OH)
     Hansen
     Harman
     Hayes
     Hayworth
     Hefner
     Hilleary
     Hinchey
     Hoke
     Holden
     Horn
     Hostettler
     Hunter
     Hutchinson
     Hyde
     Inglis
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson (SD)
     Jones
     Kanjorski
     Kaptur
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kildee
     Kleczka
     Klink
     LaFalce
     LaHood
     Lantos
     LaTourette
     Lazio
     Lewis (CA)
     Lewis (GA)
     Lipinski
     Livingston
     Lofgren
     Longley
     Lowey
     Lucas
     Maloney
     Manton
     Markey
     Martinez
     Martini
     Mascara
     McHale
     McHugh
     McInnis
     McIntosh
     McKeon
     McKinney
     McNulty
     Meehan
     Meek
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Mink
     Moakley
     Molinari
     Mollohan
     Montgomery
     Moorhead
     Moran
     Morella
     Murtha
     Myers
     Nadler
     Neal
     Neumann
     Ney
     Norwood
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Packard
     Pallone
     Pastor
     Payne (NJ)
     Payne (VA)
     Pelosi
     Peterson (MN)
     Pickett
     Pombo
     Pomeroy
     Porter
     Poshard
     Quillen
     Rahall
     Reed
     Regula
     Riggs
     Rivers
     Roberts
     Roemer
     Rogers
     Ros-Lehtinen
     Rose
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Saxton
     Scarborough
     Schaefer
     Schiff
     Schumer
     Scott
     Seastrand
     Serrano
     Shuster
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (MI)
     Smith (NJ)
     Solomon
     Souder
     Spence
     Spratt
     Stark
     Stockman
     Stokes
     Stump
     Stupak
     Talent
     Tanner
     Tate
     Tauzin
     Taylor (MS)
     Tejeda
     Thompson
     Thornberry
     Thornton
     Tiahrt
     Torkildsen
     Torres
     Torricelli
     Towns
     Traficant
     Upton
     Velazquez
     Vento
     Visclosky
     Volkmer
     Vucanovich
     Walsh
     Wamp
     Ward
     Waters
     Watt (NC)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Wicker
     Williams
     Wilson
     Wise
     Wolf
     Woolsey
     Wynn
     Yates
     Young (AK)
     Young (FL)

                               NOES--149

     Allard
     Archer
     Armey
     Bachus
     Baker (CA)
     Barrett (NE)
     Barton
     Bass
     Beilenson
     Bentsen
     Bereuter
     Berman
     Bevill
     Bilbray
     Blumenauer
     Boehner
     Bonilla
     Bono
     Brewster
     Browder
     Brownback
     Bunn
     Bunning
     Callahan
     Camp
     Campbell
     Canady
     Cardin
     Castle
     Chabot
     Chapman
     Christensen
     Chrysler
     Clinger
     Coble
     Collins (GA)
     Combest
     Cox
     Cramer
     Crane
     Cremeans
     Cubin
     de la Garza
     DeLay
     Deutsch
     Dicks
     Dreier
     Dunn
     Ehlers
     English
     Ensign
     Everett
     Fawell
     Foley
     Fowler
     Frelinghuysen
     Frisa

[[Page H6325]]


     Ganske
     Gibbons
     Gilchrest
     Goss
     Gutknecht
     Hall (TX)
     Hamilton
     Hancock
     Hastert
     Hastings (FL)
     Hastings (WA)
     Hefley
     Heineman
     Herger
     Hilliard
     Hobson
     Hoekstra
     Hoyer
     Istook
     Jacobs
     Johnson (CT)
     Johnson, E. B.
     Johnson, Sam
     Johnston
     Kasich
     Kennelly
     Kim
     King
     Kingston
     Klug
     Knollenberg
     Kolbe
     Largent
     Latham
     Laughlin
     Leach
     Levin
     Lewis (KY)
     Lightfoot
     Linder
     LoBiondo
     Luther
     Manzullo
     Matsui
     McCarthy
     McCollum
     McCrery
     McDermott
     Meyers
     Miller (FL)
     Minge
     Myrick
     Nethercutt
     Nussle
     Orton
     Parker
     Paxon
     Peterson (FL)
     Petri
     Portman
     Pryce
     Quinn
     Radanovich
     Ramstad
     Rangel
     Richardson
     Rohrabacher
     Roth
     Royce
     Salmon
     Sanford
     Sawyer
     Schroeder
     Sensenbrenner
     Shadegg
     Shaw
     Shays
     Skaggs
     Smith (TX)
     Smith (WA)
     Stearns
     Stenholm
     Studds
     Taylor (NC)
     Thomas
     Thurman
     Walker
     Waxman
     White
     Whitfield
     Zeliff
     Zimmer

                             NOT VOTING--7

     Gillmor
     Greene (UT)
     Houghton
     Lincoln
     McDade
     Miller (CA)
     Oxley

                              {time}  1321

  Messrs. KIM, KNOLLENBERG, FOLEY, McCOLLUM, ZELIFF, SHADEGG, CANADY of 
Florida, and HOYER changed their vote from ``aye'' to ``no.''
  Messrs. GILMAN, EWING, WELLER, Mrs. MEEK of Florida, and Mr. BARRETT 
of Wisconsin changed their vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.
  The CHAIRMAN. The question is on the committee amendment in the 
nature of a substitute, as amended.
  The Committee amendment in the nature of a substitute, as amended, 
was agreed to.
  The CHAIRMAN. Under the rule, the Committee rises.
  Accordingly the Committee rose; and the Speaker pro tempore (Mr. 
Barrett of Nebraska) having assumed the chair, Mr. Gutknecht, Chairman 
of the Committee of the Whole House on the State of the Union, reported 
that that Committee, having had under consideration the bill (H.R. 
2754), to approve and implement the OECD Shipbuilding Trade Agreement, 
pursuant to House Resolution 448, he reported the bill back to the 
House with an amendment adopted by the Committee of the Whole.
  The SPEAKER pro tempore. Under the rule the previous question is 
ordered.
  Is a separate vote demanded on the amendment to the Committee 
amendment in the nature of a substitute adopted by the Committee of the 
Whole? If not, the question is on the Committee amendment in the nature 
of a substitute.
  The Committee amendment in the nature of a substitute amendment was 
agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             recorded vote

  Mr. DAVIS. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 325, 
noes 100, not voting 9, as follows:

                             [Roll No. 238]

                               AYES--325

     Ackerman
     Allard
     Andrews
     Baesler
     Baker (LA)
     Baldacci
     Ballenger
     Barcia
     Barrett (NE)
     Barrett (WI)
     Bartlett
     Bass
     Bateman
     Becerra
     Beilenson
     Bentsen
     Bereuter
     Berman
     Bilbray
     Bilirakis
     Bishop
     Bliley
     Blumenauer
     Blute
     Boehlert
     Bonior
     Bono
     Borski
     Boucher
     Brewster
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Brownback
     Bryant (TN)
     Bryant (TX)
     Bunn
     Burr
     Calvert
     Campbell
     Canady
     Cardin
     Castle
     Chabot
     Chambliss
     Chapman
     Christensen
     Clay
     Clayton
     Clement
     Clinger
     Clyburn
     Coble
     Coburn
     Coleman
     Collins (MI)
     Condit
     Conyers
     Crane
     Cremeans
     Cummings
     Cunningham
     Danner
     Davis
     Deal
     DeFazio
     DeLauro
     Dellums
     Deutsch
     Dickey
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Dreier
     Duncan
     Durbin
     Ehlers
     Ehrlich
     Emerson
     Engel
     Ensign
     Eshoo
     Ewing
     Farr
     Fattah
     Fawell
     Fazio
     Fields (LA)
     Fields (TX)
     Filner
     Flake
     Flanagan
     Foglietta
     Forbes
     Ford
     Fox
     Frank (MA)
     Franks (CT)
     Franks (NJ)
     Frelinghuysen
     Frisa
     Frost
     Funderburk
     Furse
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Geren
     Gibbons
     Gilchrest
     Gilman
     Gonzalez
     Goodlatte
     Goodling
     Gordon
     Goss
     Greene (UT)
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hamilton
     Hancock
     Hansen
     Harman
     Hastings (FL)
     Hayes
     Hayworth
     Hefley
     Hefner
     Heineman
     Herger
     Hinchey
     Hoekstra
     Hoke
     Horn
     Hostettler
     Hoyer
     Hutchinson
     Hyde
     Inglis
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson (SD)
     Johnson, E. B.
     Johnston
     Jones
     Kanjorski
     Kaptur
     Kasich
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kim
     King
     Kleczka
     Knollenberg
     LaFalce
     LaHood
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Levin
     Lewis (CA)
     Lewis (GA)
     Lightfoot
     Linder
     Lipinski
     Livingston
     Lofgren
     Lowey
     Lucas
     Luther
     Maloney
     Manton
     Manzullo
     Markey
     Martinez
     Martini
     Mascara
     Matsui
     McCarthy
     McCollum
     McHale
     McHugh
     McInnis
     McIntosh
     McKeon
     McKinney
     McNulty
     Meehan
     Meek
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Miller (FL)
     Minge
     Mink
     Moakley
     Molinari
     Moorhead
     Moran
     Morella
     Murtha
     Myers
     Myrick
     Nadler
     Neal
     Ney
     Norwood
     Olver
     Ortiz
     Orton
     Owens
     Packard
     Pallone
     Parker
     Pastor
     Paxon
     Payne (NJ)
     Payne (VA)
     Pelosi
     Peterson (FL)
     Peterson (MN)
     Petri
     Pickett
     Pomeroy
     Porter
     Pryce
     Quillen
     Quinn
     Radanovich
     Rangel
     Reed
     Regula
     Richardson
     Riggs
     Rivers
     Roberts
     Roemer
     Rogers
     Roth
     Roukema
     Roybal-Allard
     Sabo
     Sanders
     Sawyer
     Saxton
     Scarborough
     Schaefer
     Schiff
     Schumer
     Scott
     Seastrand
     Sensenbrenner
     Serrano
     Shaw
     Shays
     Shuster
     Sisisky
     Skaggs
     Skeen
     Skelton
     Slaughter
     Smith (MI)
     Smith (TX)
     Solomon
     Souder
     Spence
     Spratt
     Stark
     Stenholm
     Stokes
     Studds
     Stupak
     Talent
     Tate
     Tauzin
     Taylor (NC)
     Tejeda
     Thomas
     Thornberry
     Thornton
     Thurman
     Torkildsen
     Torres
     Towns
     Upton
     Velazquez
     Vento
     Visclosky
     Volkmer
     Vucanovich
     Walker
     Walsh
     Wamp
     Ward
     Waters
     Watt (NC)
     Watts (OK)
     Waxman
     Weldon (FL)
     Weldon (PA)
     Weller
     Wicker
     Williams
     Wilson
     Wolf
     Woolsey
     Wynn
     Young (AK)
     Young (FL)
     Zeliff

                               NOES--100

     Abercrombie
     Archer
     Armey
     Bachus
     Baker (CA)
     Barr
     Barton
     Bevill
     Boehner
     Bonilla
     Browder
     Bunning
     Burton
     Callahan
     Camp
     Chenoweth
     Chrysler
     Collins (GA)
     Collins (IL)
     Combest
     Cooley
     Costello
     Cox
     Coyne
     Cramer
     Crapo
     Cubin
     de la Garza
     DeLay
     Diaz-Balart
     Dicks
     Doolittle
     Dornan
     Dunn
     English
     Evans
     Everett
     Foley
     Fowler
     Graham
     Gunderson
     Hall (TX)
     Hastert
     Hastings (WA)
     Hilleary
     Hilliard
     Hobson
     Holden
     Hunter
     Jacobs
     Johnson (CT)
     Johnson, Sam
     Kingston
     Klink
     Klug
     Kolbe
     Lantos
     Laughlin
     Lewis (KY)
     LoBiondo
     Longley
     McCrery
     McDermott
     Mollohan
     Montgomery
     Nethercutt
     Neumann
     Nussle
     Oberstar
     Obey
     Pombo
     Portman
     Poshard
     Rahall
     Ramstad
     Rohrabacher
     Ros-Lehtinen
     Rose
     Royce
     Rush
     Salmon
     Sanford
     Schroeder
     Shadegg
     Smith (NJ)
     Smith (WA)
     Stearns
     Stockman
     Stump
     Tanner
     Taylor (MS)
     Thompson
     Tiahrt
     Torricelli
     Traficant
     White
     Whitfield
     Wise
     Yates
     Zimmer

                             NOT VOTING--9

     Buyer
     Edwards
     Gillmor
     Green (TX)
     Houghton
     Lincoln
     McDade
     Meyers
     Oxley

                              {time}  1342

  Mr. McNULTY changed his vote from ``no'' to ``aye.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________