[Congressional Record Volume 145, Number 91 (Thursday, June 24, 1999)]
[Extensions of Remarks]
[Page E1400]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    THE INTERNATIONAL ARBITRATION ENFORCEMENT ACT AND THE NEW YORK 
                       CONVENTION COMPLIANCE ACT

                                 ______
                                 

                           HON. BILL McCOLLUM

                               of florida

                    in the house of representatives

                        Thursday, June 24, 1999

  Mr. McCOLLUM. Mr. Speaker, today I am introducing legislation, the 
International Arbitration Enforcement Act and the New York Convention 
Compliance Act, to protect American businesses from foreign backed 
companies who fail to act in good faith.
  In 1991, Ross Manufacturing, a Florida company, filed a claim with 
the Stockholm Arbitration Institute against a Chinese state-owned 
corporation for defaulting on a contractual agreement. Even though the 
arbitration panel found in favor of Ross Manufacturing, the Chinese 
company refused to pay the settlement. Furthermore, the Chinese courts 
initially refused to accept the claim. By the time the claim was 
eventually accepted by the Chinese courts, the Chinese company had been 
liquidated and the Chinese offered no remedy to enforce the settlement. 
This was so even though the liquidated company was a state-run industry 
and it appears may have been liquidated as a pretense just to give 
cover to avoiding this debt.
  There are companies throughout this country that have ventured into 
business relationships with China and been burned. That is why I am 
introducing two pieces of legislation to protect U.S. companies and 
make sure that foreign companies live up to pre-existing trade 
agreements.
  The International Arbitration Enforcement Act, would create a civil 
remedy against foreign states that either ignore or prohibit arbitral 
awards entered in favor of United States persons. If the President 
certifies that a person has been injured and has exhausted every avenue 
of relief in pursuing enforcement of a foreign arbitral award then that 
person gets his or her day in Federal Court to pursue a civil action 
against the foreign state.
  The New York Convention Compliance Act, would direct the President to 
withhold extension of the WTO Agreement to any country that is not in 
compliance with its obligations under the New York Convention. This 
would require foreign countries to meet their outstanding obligations 
before receiving full consideration for WTO ascension.
  While I believe that American companies need to be prudent in their 
dealings with entities overseas, having a company fully backed by the 
Chinese government default on a legal and binding contract is 
unacceptable. I urge my colleagues to support this timely legislation.

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