[Congressional Record Volume 150, Number 97 (Wednesday, July 14, 2004)]
[House]
[Pages H5690-H5720]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         UNITED STATES-AUSTRALIA FREE TRADE IMPLEMENTATION ACT

  Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 712, I call up 
the bill (H.R. 4759) to implement the United States-Australia Free 
Trade Agreement, and ask for its immediate consideration.
  The Clerk read the title of the bill.
  The text of H.R. 4759 is as follows:

                               H.R. 4759

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``United 
     States-Australia Free Trade Agreement Implementation Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents. 
Sec. 2. Purposes. 
Sec. 3. Definitions. 

TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT

Sec. 101. Approval and entry into force of the Agreement. 
Sec. 102. Relationship of the Agreement to United States and State law. 

Sec. 103. Implementing actions in anticipation of entry into force and 
              initial regulations. 
Sec. 104. Consultation and layover provisions for, and effective date 
              of, proclaimed actions. 
Sec. 105. Administration of dispute settlement proceedings. 
Sec. 106. Effective dates; effect of termination. 

                      TITLE II--CUSTOMS PROVISIONS

Sec. 201. Tariff modifications. 
Sec. 202. Additional duties on certain agricultural goods. 
Sec. 203. Rules of origin.
Sec. 204. Customs user fees. 
Sec. 205. Disclosure of incorrect information. 
Sec. 206. Enforcement relating to trade in textile and apparel goods. 
Sec. 207. Regulations. 

                     TITLE III--RELIEF FROM IMPORTS

Sec. 301. Definitions. 

     Subtitle A--Relief From Imports Benefiting From the Agreement

Sec. 311. Commencing of action for relief. 
Sec. 312. Commission action on petition. 
Sec. 313. Provision of relief. 
Sec. 314. Termination of relief authority. 
Sec. 315. Compensation authority. 
Sec. 316. Confidential business information. 

           Subtitle B--Textile and Apparel Safeguard Measures

Sec. 321. Commencement of action for relief. 
Sec. 322. Determination and provision of relief. 
Sec. 323. Period of relief. 
Sec. 324. Articles exempt from relief. 
Sec. 325. Rate after termination of import relief. 
Sec. 326. Termination of relief authority. 
Sec. 327. Compensation authority. 
Sec. 328. Business confidential information. 

       Subtitle C--Cases Under Title II of the Trade Act of 1974

Sec. 331. Findings and action on goods from Australia. 

                         TITLE IV--PROCUREMENT

Sec. 401. Eligible products. 

     SEC. 2. PURPOSES.

       The purposes of this Act are--
       (1) to approve and implement the Free Trade Agreement 
     between the United States and Australia, entered into under 
     the authority of section 2103(b) of the Bipartisan Trade 
     Promotion Authority Act of 2002 (19 U.S.C. 3803(b));
       (2) to strengthen and develop economic relations between 
     the United States and Australia for their mutual benefit;
       (3) to establish free trade between the 2 nations through 
     the reduction and elimination of barriers to trade in goods 
     and services and to investment; and
       (4) to lay the foundation for further cooperation to expand 
     and enhance the benefits of such Agreement.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Agreement.--The term ``Agreement'' means the United 
     States-Australia Free Trade Agreement approved by Congress 
     under section 101(a)(1).
       (2) HTS.--The term ``HTS'' means the Harmonized Tariff 
     Schedule of the United States.
       (3) Textile or apparel good.--The term ``textile or apparel 
     good'' means a good listed in the Annex to the Agreement on 
     Textiles and Clothing referred to in section 101(d)(4) of the 
     Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).

TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT

     SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE AGREEMENT.

       (a) Approval of Agreement and Statement of Administrative 
     Action.--Pursuant to section 2105 of the Bipartisan Trade 
     Promotion Authority Act of 2002 (19 U.S.C. 3805) and section 
     151 of the Trade Act of 1974 (19 U.S.C. 2191), Congress 
     approves--
       (1) the United States-Australia Free Trade Agreement 
     entered into on May 18, 2004, with the Government of 
     Australia and submitted to Congress on July 6, 2004; and
       (2) the statement of administrative action proposed to 
     implement the Agreement that was submitted to Congress on 
     July 6, 2004.
       (b) Conditions for Entry Into Force of the Agreement.--At 
     such time as the President determines that Australia has 
     taken measures necessary to bring it into compliance with 
     those provisions of the Agreement that are to take effect on 
     the date on which the Agreement enters into force, the 
     President is authorized to exchange notes with the Government 
     of Australia providing for the entry into force, on or after 
     January 1, 2005, of the Agreement with respect to the United 
     States.

     SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES AND 
                   STATE LAW.

       (a) Relationship of Agreement to United States Law.--
       (1) United states law to prevail in conflict.--No provision 
     of the Agreement, nor the application of any such provision 
     to any person or circumstance, which is inconsistent with any 
     law of the United States shall have effect.
       (2) Construction.--Nothing in this Act shall be construed--
       (A) to amend or modify any law of the United States, or
       (B) to limit any authority conferred under any law of the 
     United States,
     unless specifically provided for in this Act.
       (b) Relationship of Agreement to State Law.--
       (1) Legal challenge.--No State law, or the application 
     thereof, may be declared invalid as to any person or 
     circumstance on the ground that the provision or application 
     is inconsistent with the Agreement, except in an action 
     brought by the United States for the purpose of declaring 
     such law or application invalid.
       (2) Definition of state law.--For purposes of this 
     subsection, the term ``State law'' includes--
       (A) any law of a political subdivision of a State; and
       (B) any State law regulating or taxing the business of 
     insurance.
       (c) Effect of Agreement With Respect to Private Remedies.--
     No person other than the United States--
       (1) shall have any cause of action or defense under the 
     Agreement or by virtue of congressional approval thereof; or
       (2) may challenge, in any action brought under any 
     provision of law, any action or inaction by any department, 
     agency, or other instrumentality of the United States, any 
     State, or any political subdivision of a State, on the ground 
     that such action or inaction is inconsistent with the 
     Agreement.

     SEC. 103. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO 
                   FORCE AND INITIAL REGULATIONS.

       (a) Implementing Actions.--
       (1) Proclamation authority.--After the date of the 
     enactment of this Act--
       (A) the President may proclaim such actions, and
       (B) other appropriate officers of the United States 
     Government may issue such regulations,
     as may be necessary to ensure that any provision of this Act, 
     or amendment made by this Act, that takes effect on the date 
     the Agreement enters into force is appropriately implemented 
     on such date, but no such proclamation or regulation may have 
     an effective date earlier than the date on which the 
     Agreement enters into force.
       (2) Effective date of certain proclaimed actions.--Any 
     action proclaimed by the

[[Page H5691]]

     President under the authority of this Act that is not subject 
     to the consultation and layover provisions under section 104, 
     may not take effect before the 15th day after the date on 
     which the text of the proclamation is published in the 
     Federal Register.
       (3) Waiver of 15-day restriction.--The 15-day restriction 
     in paragraph (2) on the taking effect of proclaimed actions 
     is waived to the extent that the application of such 
     restriction would prevent the taking effect on the date the 
     Agreement enters into force of any action proclaimed under 
     this section.
       (b) Initial Regulations.--Initial regulations necessary or 
     appropriate to carry out the actions required by or 
     authorized under this Act or proposed in the statement of 
     administrative action submitted under section 101(a)(2) to 
     implement the Agreement shall, to the maximum extent 
     feasible, be issued within 1 year after the date on which the 
     Agreement enters into force. In the case of any implementing 
     action that takes effect on a date after the date on which 
     the Agreement enters into force, initial regulations to carry 
     out that action shall, to the maximum extent feasible, be 
     issued within 1 year after such effective date.

     SEC. 104. CONSULTATION AND LAYOVER PROVISIONS FOR, AND 
                   EFFECTIVE DATE OF, PROCLAIMED ACTIONS.

       If a provision of this Act provides that the implementation 
     of an action by the President by proclamation is subject to 
     the consultation and layover requirements of this section, 
     such action may be proclaimed only if--
       (1) the President has obtained advice regarding the 
     proposed action from--
       (A) the appropriate advisory committees established under 
     section 135 of the Trade Act of 1974 (19 U.S.C. 2155); and
       (B) the United States International Trade Commission;
       (2) the President has submitted a report to the Committee 
     on Finance of the Senate and the Committee on Ways and Means 
     of the House of Representatives that sets forth--
       (A) the action proposed to be proclaimed and the reasons 
     therefor; and
       (B) the advice obtained under paragraph (1);
       (3) a period of 60 calendar days, beginning on the first 
     day on which the requirements set forth in paragraphs (1) and 
     (2) have been met has expired; and
       (4) the President has consulted with such Committees 
     regarding the proposed action during the period referred to 
     in paragraph (3).

     SEC. 105. ADMINISTRATION OF DISPUTE SETTLEMENT PROCEEDINGS.

       (a) Establishment or Designation of Office.--The President 
     is authorized to establish or designate within the Department 
     of Commerce an office that shall be responsible for providing 
     administrative assistance to panels established under chapter 
     21 of the Agreement. The office may not be considered to be 
     an agency for purposes of section 552 of title 5, United 
     States Code.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated for each fiscal year after fiscal year 
     2004 to the Department of Commerce such sums as may be 
     necessary for the establishment and operations of the office 
     under subsection (a) and for the payment of the United States 
     share of the expenses of panels established under chapter 21 
     of the Agreement.

     SEC. 106. EFFECTIVE DATES; EFFECT OF TERMINATION.

       (a) Effective Dates.--Except as provided in subsection (b), 
     the provisions of this Act and the amendments made by this 
     Act take effect on the date on which the Agreement enters 
     into force.
       (b) Exceptions.--Sections 1 through 3 and this title take 
     effect on the date of the enactment of this Act.
       (c) Termination of the Agreement.--On the date on which the 
     Agreement terminates, the provisions of this Act (other than 
     this subsection) and the amendments made by this Act shall 
     cease to be effective.

                      TITLE II--CUSTOMS PROVISIONS

     SEC. 201. TARIFF MODIFICATIONS.

       (a) Tariff Modifications Provided for in the Agreement.--
     The President may proclaim--
       (1) such modifications or continuation of any duty,
       (2) such continuation of duty-free or excise treatment, or
       (3) such additional duties,
     as the President determines to be necessary or appropriate to 
     carry out or apply articles 2.3, 2.5, and 2.6, and Annex 2-B 
     of the Agreement.
       (b) Other Tariff Modifications.--Subject to the 
     consultation and layover provisions of section 104, the 
     President may proclaim--
       (1) such modifications or continuation of any duty,
       (2) such modifications as the United States may agree to 
     with Australia regarding the staging of any duty treatment 
     set forth in Annex 2-B of the Agreement,
       (3) such continuation of duty-free or excise treatment, or
       (4) such additional duties,
     as the President determines to be necessary or appropriate to 
     maintain the general level of reciprocal and mutually 
     advantageous concessions with respect to Australia provided 
     for by the Agreement.
       (c) Conversion to Ad Valorem Rates.--For purposes of 
     subsections (a) and (b), with respect to any good for which 
     the base rate in the Schedule of the United States to Annex 
     2-B of the Agreement is a specific or compound rate of duty, 
     the President may substitute for the base rate an ad valorem 
     rate that the President determines to be equivalent to the 
     base rate.

     SEC. 202. ADDITIONAL DUTIES ON CERTAIN AGRICULTURAL GOODS.

       (a) General Provisions.--
       (1) Applicability of subsection.--This subsection applies 
     to additional duties assessed under subsections (b), (c), and 
     (d).
       (2) Applicable ntr (mfn) rate of duty.--For purposes of 
     subsections (b), (c), and (d), the term ``applicable NTR 
     (MFN) rate of duty'' means, with respect to a safeguard good, 
     a rate of duty that is the lesser of--
       (A) the column 1 general rate of duty that would have been 
     imposed under the HTS on the same safeguard good entered, 
     without a claim for preferential treatment, at the time the 
     additional duty is imposed under subsection (b), (c), or (d), 
     as the case may be; or
       (B) the column 1 general rate of duty that would have been 
     imposed under the HTS on the same safeguard good entered, 
     without a claim for preferential treatment, on December 31, 
     2004.
       (3) Schedule rate of duty.--For purposes of subsections (b) 
     and (c), the term ``schedule rate of duty'' means, with 
     respect to a safeguard good, the rate of duty for that good 
     set out in the Schedule of the United States to Annex 2-B of 
     the Agreement.
       (4) Safeguard good.--In this subsection, the term 
     ``safeguard good'' means--
       (A) a horticulture safeguard good described subsection 
     (b)(1)(B); or
       (B) a beef safeguard good described in subsection (c)(1) or 
     subsection (d)(1)(A).
       (5) Exceptions.--No additional duty shall be assessed on a 
     good under subsection (b), (c), or (d) if, at the time of 
     entry, the good is subject to import relief under--
       (A) subtitle A of title III of this Act; or
       (B) chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.).
       (6) Termination.--The assessment of an additional duty on a 
     good under subsection (b) or (c), whichever is applicable, 
     shall cease to apply to that good on the date on which duty-
     free treatment must be provided to that good under the 
     Schedule of the United States to Annex 2-B of the Agreement.
       (7) Notice.--Not later than 60 days after the date on which 
     the Secretary of the Treasury assesses an additional duty on 
     a good under subsection (b), (c), or (d), the Secretary shall 
     notify the Government of Australia in writing of such action 
     and shall provide to that Government data supporting the 
     assessment of the additional duty.
       (b) Additional Duties on Horticulture Safeguard Goods.--
       (1) Definitions.--In this subsection:
       (A)  F.O.B.--The term ``F.O.B.'' means free on board, 
     regardless of the mode of transportation, at the point of 
     direct shipment by the seller to the buyer.
       (B) Horticulture safeguard good.--The term ``horticulture 
     safeguard good'' means a good--
       (i) that qualifies as an originating good under section 
     203;
       (ii) that is included in the United States Horticulture 
     Safeguard List set forth in Annex 3-A of the Agreement; and
       (iii) for which a claim for preferential treatment under 
     the Agreement has been made.
       (C) Unit import price.--The ``unit import price'' of a good 
     means the price of the good determined on the basis of the 
     F.O.B. import price of the good, expressed in either dollars 
     per kilogram or dollars per liter, whichever unit of measure 
     is indicated for the good in the United States Horticulture 
     Safeguard List set forth in Annex 3-A of the Agreement.
       (D) Trigger price.--The ``trigger price'' for a good is the 
     trigger price indicated for that good in the United States 
     Horticulture Safeguard List set forth in Annex 3-A of the 
     Agreement or any amendment thereto.
       (2) Additional duties.--In addition to any duty proclaimed 
     under subsection (a) or (b) of section 201, and subject to 
     subsection (a) of this section, the Secretary of the Treasury 
     shall assess a duty on a horticulture safeguard good, in the 
     amount determined under paragraph (3), if the Secretary 
     determines that the unit import price of the good when it 
     enters the United States is less than the trigger price for 
     that good.
       (3) Calculation of additional duty.--The additional duty 
     assessed under this subsection on a horticulture safeguard 
     good shall be an amount determined in accordance with the 
     following table:


 
 
 
If the excess of the trigger price over     The additional duty is an
 the unit import price is:.                  amount equal to:
 
Not more than 10 percent of the trigger     0.
 price.
More than 10 percent but not more than 40   30 percent of the excess of
 percent of the trigger price.               the applicable NTR (MFN)
                                             rate of duty over the
                                             schedule rate of duty.
More than 40 percent but not more than 60   50 percent of such excess.
 percent of the trigger price.
More than 60 percent but not more than 75   70 percent of such excess.
 percent of the trigger price.
More than 75 percent of the trigger price.  100 percent of such excess.
 


[[Page H5692]]

       (c) Additional Duties on Beef Safeguard Goods Based on 
     Quantity of Imports.--
       (1) Definition.--In this subsection, the term ``beef 
     safeguard good'' means a good--
       (A) that qualifies as an originating good under section 
     203;
       (B) that is listed in paragraph 3 of Annex I of the General 
     Notes to the Schedule of the United States to Annex 2-B of 
     the Agreement; and
       (C) for which a claim for preferential treatment under the 
     Agreement has been made.
       (2) Additional duties.--In addition to any duty proclaimed 
     under subsection (a) or (b) of section 201, and subject to 
     subsection (a) of this section and paragraphs (4) and (5) of 
     this subsection, the Secretary of the Treasury shall assess a 
     duty, in the amount determined under paragraph (3), on a beef 
     safeguard good imported into the United States in a calendar 
     year if the Secretary determines that, prior to such 
     importation, the total volume of beef safeguard goods 
     imported into the United States in that calendar year is 
     equal to or greater than 110 percent of the volume set out 
     for beef safeguard goods in the corresponding year in the 
     table contained in paragraph 3(a) of Annex I of the General 
     Notes to the Schedule of the United States to Annex 2-B of 
     the Agreement. For purposes of this subsection, the years 1 
     through 19 set out in the table contained in paragraph 3(a) 
     of such Annex I correspond to the calendar years 2005 through 
     2023.
       (3) Calculation of additional duty.--The additional duty on 
     a beef safeguard good under this subsection shall be an 
     amount equal to 75 percent of the excess of the applicable 
     NTR (MFN) rate of duty over the schedule rate of duty.
       (4) Waiver.--
       (A) In general.--The United States Trade Representative is 
     authorized to waive the application of this subsection, if 
     the Trade Representative determines that extraordinary market 
     conditions demonstrate that the waiver would be in the 
     national interest of the United States, after the 
     requirements of subparagraph (B) are met.
       (B) Notice and consultations.--Promptly after receiving a 
     request for a waiver of this subsection, the Trade 
     Representative shall notify the Committee on Ways and Means 
     of the House of Representatives and the Committee on Finance 
     of the Senate, and may make the determination provided for in 
     subparagraph (A) only after consulting with--
       (i) appropriate private sector advisory committees 
     established under section 135 of the Trade Act of 1974 (19 
     U.S.C. 2155); and
       (ii) the Committee on Ways and Means of the House of 
     Representatives and the Committee on Finance of the Senate 
     regarding--

       (I) the reasons supporting the determination to grant the 
     waiver; and
       (II) the proposed scope and duration of the waiver.

       (C) Notification of the secretary of the treasury and 
     publication.--Upon granting a waiver under this paragraph, 
     the Trade Representative shall promptly notify the Secretary 
     of the Treasury of the period in which the waiver will be in 
     effect, and shall publish notice of the waiver in the Federal 
     Register.
       (5) Effective dates.--This subsection takes effect on 
     January 1, 2013, and shall not be effective after December 
     31, 2022.
       (d) Additional Duties on Beef Safeguard Goods Based on 
     Price.--
       (1) Definitions.--In this subsection:
       (A) Beef safeguard good.--The term ``beef safeguard good'' 
     means a good--
       (i) that qualifies as an originating good under section 
     203;
       (ii) that is classified under subheading 0201.10.50, 
     0201.20.80, 0201.30.80, 0202.10.50, 0202.20.80, or 0202.30.80 
     of the HTS; and
       (iii) for which a claim for preferential treatment under 
     the Agreement has been made.
       (B) Calendar quarter.--
       (i) In general.--The term ``calendar quarter'' means any 3-
     month period beginning on January 1, April 1, July 1, or 
     October 1 of a calendar year.
       (ii) First calendar quarter.--The term ``first calendar 
     quarter'' means the calendar quarter beginning on January 1.
       (iii) Second calendar quarter.--The term ``second calendar 
     quarter'' means the calendar quarter beginning on April 1.
       (iv) Third calendar quarter.--The term ``third calendar 
     quarter'' means the calendar quarter beginning on July 1.
       (v) Fourth calendar quarter.--The term ``fourth calendar 
     quarter'' means the calendar quarter beginning on October 1.
       (C) Monthly average index price.--The term ``monthly 
     average index price'' means the simple average, as determined 
     by the Secretary of Agriculture, for a calendar month of the 
     daily average index prices for Wholesale Boxed Beef Cut-Out 
     Value Select 1-3 Central U.S. 600-750 lbs., or its 
     equivalent, as such simple average is reported by the 
     Agricultural Marketing Service of the Department of 
     Agriculture in Report LM-XB459 or any equivalent report.
       (D) 24-month trigger price.--The term ``24-month trigger 
     price'' means, with respect to any calendar month, the 
     average of the monthly average index prices for the 24 
     preceding calendar months, multiplied by 0.935.
       (2) Additional duties.--In addition to any duty proclaimed 
     under subsection (a) or (b) of section 201, and subject to 
     subsection (a) of this section and paragraphs (4) through (6) 
     of this subsection, the Secretary of the Treasury shall 
     assess a duty, in the amount determined under paragraph (3), 
     on a beef safeguard good imported into the United States if--
       (A)(i) the good is imported in the first calendar quarter, 
     second calendar quarter, or third calendar quarter of a 
     calendar year; and
       (ii) the monthly average index price, in any 2 calendar 
     months of the preceding calendar quarter, is less than the 
     24-month trigger price; or
       (B)(i) the good is imported in the fourth calendar quarter 
     of a calendar year; and
       (ii)(I) the monthly average index price, in any 2 calendar 
     months of the preceding calendar quarter, is less than the 
     24-month trigger price; or
       (II) the monthly average index price, in any of the 4 
     calendar months preceding January 1 of the succeeding 
     calendar year, is less than the 24-month trigger price.
       (3) Calculation of additional duty.--The additional duty on 
     a beef safeguard good under this subsection shall be an 
     amount equal to 65 percent of the applicable NTR (MFN) rate 
     of duty for that good.
       (4) Limitation.--An additional duty shall be assessed under 
     this subsection on a beef safeguard good imported into the 
     United States in a calendar year only if, prior to the 
     importation of that good, the total quantity of beef 
     safeguard goods imported into the United States in that 
     calendar year is equal to or greater than the sum of--
       (A) the quantity of goods of Australia eligible to enter 
     the United States in that year specified in Additional United 
     States Note 3 to Chapter 2 of the HTS; and
       (B)(i) in 2023, 70,420 metric tons; or
       (ii) in 2024, and in each year thereafter, a quantity that 
     is 0.6 percent greater than the quantity provided for in the 
     preceding year under this subparagraph.
       (5) Waiver.--
       (A) In general.--The United States Trade Representative is 
     authorized to waive the application of this subsection, if 
     the Trade Representative determines that extraordinary market 
     conditions demonstrate that the waiver would be in the 
     national interest of the United States, after the 
     requirements of subparagraph (B) are met.
       (B) Notice and consultations.--Promptly after receiving a 
     request for a waiver of this subsection, the Trade 
     Representative shall notify the Committee on Ways and Means 
     of the House of Representatives and the Committee on Finance 
     of the Senate, and may make the determination provided for in 
     subparagraph (A) only after consulting with--
       (i) appropriate private sector advisory committees 
     established under section 135 of the Trade Act of 1974 (19 
     U.S.C. 2155); and
       (ii) the Committee on Ways and Means of the House of 
     Representatives and the Committee on Finance of the Senate 
     regarding--

       (I) the reasons supporting the determination to grant the 
     waiver; and
       (II) the proposed scope and duration of the waiver.

       (C) Notification of the secretary of the treasury and 
     publication.--Upon granting a waiver under this paragraph, 
     the Trade Representative shall promptly notify the Secretary 
     of the Treasury of the period in which the waiver will be in 
     effect, and shall publish notice of the waiver in the Federal 
     Register.
       (6) Effective date.--This subsection takes effect on 
     January 1, 2023.

     SEC. 203. RULES OF ORIGIN.

       (a) Application and Interpretation.--In this section:
       (1) Tariff classification.--The basis for any tariff 
     classification is the HTS.
       (2) Reference to hts.--Whenever in this section there is a 
     reference to a heading or subheading, such reference shall be 
     a reference to a heading or subheading of the HTS.
       (3) Cost or value.--Any cost or value referred to in this 
     section shall be recorded and maintained in accordance with 
     the generally accepted accounting principles applicable in 
     the territory of the country in which the good is produced 
     (whether Australia or the United States).
       (b) Originating Goods.--For purposes of this Act and for 
     purposes of implementing the preferential treatment provided 
     for under the Agreement, a good is an originating good if--
       (1) the good is a good wholly obtained or produced entirely 
     in the territory of Australia, the United States, or both;
       (2) the good--
       (A) is produced entirely in the territory of Australia, the 
     United States, or both, and--
       (i) each of the nonoriginating materials used in the 
     production of the good undergoes an applicable change in 
     tariff classification specified in Annex 4-A or Annex 5-A of 
     the Agreement;
       (ii) the good otherwise satisfies any applicable regional 
     value-content requirement referred to in Annex 5-A of the 
     Agreement; or
       (iii) the good meets any other requirements specified in 
     Annex 4-A or Annex 5-A of the Agreement; and
       (B) the good satisfies all other applicable requirements of 
     this section;
       (3) the good is produced entirely in the territory of 
     Australia, the United States, or both, exclusively from 
     materials described in paragraph (1) or (2); or
       (4) the good otherwise qualifies as an originating good 
     under this section.

[[Page H5693]]

       (c) De Minimis Amounts of Nonoriginating Materials.--
       (1) In general.--Except as provided in paragraphs (2) and 
     (3), a good that does not undergo a change in tariff 
     classification pursuant to Annex 5-A of the Agreement is an 
     originating good if--
       (A) the value of all nonoriginating materials that--
       (i) are used in the production of the good, and
       (ii) do not undergo the required change in tariff 
     classification,

     does not exceed 10 percent of the adjusted value of the good;
       (B) the good meets all other applicable requirements of 
     this section; and
       (C) the value of such nonoriginating materials is included 
     in the value of nonoriginating materials for any applicable 
     regional value-content requirement for the good.
       (2) Exceptions.--Paragraph (1) does not apply to the 
     following:
       (A) A nonoriginating material provided for in chapter 4 of 
     the HTS or in subheading 1901.90 that is used in the 
     production of a good provided for in chapter 4 of the HTS.
       (B) A nonoriginating material provided for in chapter 4 of 
     the HTS or in subheading 1901.90 that is used in the 
     production of a good provided for in subheading 1901.10, 
     1901.20, or 1901.90, heading 2105, or subheading 2106.90, 
     2202.90, or 2309.90.
       (C) A nonoriginating material provided for in heading 0805 
     or any of subheadings 2009.11 through 2009.39 that is used in 
     the production of a good provided for in any of subheadings 
     2009.11 through 2009.39, or in subheading 2106.90 or 2202.90.
       (D) A nonoriginating material provided for in chapter 15 of 
     the HTS that is used in the production of a good provided for 
     in any of headings 1501.00.00 through 1508, or in heading 
     1512, 1514, or 1515.
       (E) A nonoriginating material provided for in heading 1701 
     that is used in the production of a good provided for in any 
     of headings 1701 through 1703.
       (F) A nonoriginating material provided for in chapter 17 of 
     the HTS or heading 1805.00.00 that is used in the production 
     of a good provided for in subheading 1806.10.
       (G) A nonoriginating material provided for in any of 
     headings 2203 through 2208 that is used in the production of 
     a good provided for in heading 2207 or 2208.
       (H) A nonoriginating material used in the production of a 
     good provided for in any of chapters 1 through 21 of the HTS 
     unless the nonoriginating material is provided for in a 
     different subheading than the good for which origin is being 
     determined under this section.
       (3) Textile and apparel goods.--
       (A) In general.--Except as provided in subparagraph (B), a 
     textile or apparel good that is not an originating good 
     because certain fibers or yarns used in the production of the 
     component of the good that determines the tariff 
     classification of the good do not undergo an applicable 
     change in tariff classification set out in Annex 4-A of the 
     Agreement shall be considered to be an originating good if 
     the total weight of all such fibers or yarns in that 
     component is not more than 7 percent of the total weight of 
     that component.
       (B) Certain textile or apparel goods.--A textile or apparel 
     good containing elastomeric yarns in the component of the 
     good that determines the tariff classification of the good 
     shall be considered to be an originating good only if such 
     yarns are wholly formed in the territory of Australia or the 
     United States.
       (C) Yarn, fabric, or fiber.--For purposes of this 
     paragraph, in the case of a textile or apparel good that is a 
     yarn, fabric, or group of fibers, the term ``component of the 
     good that determines the tariff classification of the good'' 
     means all of the fibers in the yarn, fabric, or group of 
     fibers.
       (d) Accumulation.--
       (1) Originating materials used in production of goods of 
     other country.--Originating materials from the territory of 
     Australia or the United States that are used in the 
     production of a good in the territory of the other country 
     shall be considered to originate in the territory of the 
     other country.
       (2) Multiple procedures.--A good that is produced in the 
     territory of Australia, the United States, or both, by 1 or 
     more producers, is an originating good if the good satisfies 
     the requirements of subsection (b) and all other applicable 
     requirements of this section.
       (e) Regional Value-Content.--
       (1) In general.--For purposes of subsection (b)(2), the 
     regional value-content of a good referred to in Annex 5-A of 
     the Agreement, except for goods to which paragraph (4) 
     applies, shall be calculated by the importer, exporter, or 
     producer of the good, on the basis of the build-down method 
     described in paragraph (2) or the build-up method described 
     in paragraph (3).
       (2) Build-down method.--
       (A) In general.--The regional value-content of a good may 
     be calculated on the basis of the following build-down 
     method:

                                 av-vnm

                           rvc = -------- 100

                                   av

       (B) Definitions.--In subparagraph (A):
       (i) RVC.--The term ``RVC'' means the regional value-content 
     of the good, expressed as a percentage.
       (ii) AV.--The term ``AV'' means the adjusted value of the 
     good.
       (iii) VNM.--The term ``VNM'' means the value of 
     nonoriginating materials that are acquired and used by the 
     producer in the production of the good, but does not include 
     the value of a material that is self-produced.
       (3) Build-up method.--
       (A) In general.--The regional value-content of a good may 
     be calculated on the basis of the following build-up method:

                                   vom

                           rvc = -------- 100

                                   av

       (B) Definitions.--In subparagraph (A):
       (i) RVC.--The term ``RVC'' means the regional value-content 
     of the good, expressed as a percentage.
       (ii) AV.--The term ``AV'' means the adjusted value of the 
     good.
       (iii) VOM.--The term ``VOM'' means the value of originating 
     materials that are acquired or self-produced, and used by the 
     producer in the production of the good.
       (4) Special rule for certain automotive goods.--
       (A) In general.--For purposes of subsection (b)(2), the 
     regional value-content of an automotive good referred to in 
     Annex 5-A of the Agreement shall be calculated by the 
     importer, exporter, or producer of the good, on the basis of 
     the following net cost method:

                                 nc-vnm

                           rvc = -------- 100

                                   nc

       (B) Definitions.--In subparagraph (A):
       (i) Automotive good.--The term ``automotive good'' means a 
     good provided for in any of subheadings 8407.31 through 
     8407.34, subheading 8408.20, heading 8409, or in any of 
     headings 8701 through 8708.
       (ii) RVC.--The term ``RVC'' means the regional value-
     content of the automotive good, expressed as a percentage.
       (iii) NC.--The term ``NC'' means the net cost of the 
     automotive good.
       (iv) VNM.--The term ``VNM'' means the value of 
     nonoriginating materials that are acquired and used by the 
     producer in the production of the automotive good, but does 
     not include the value of a material that is self-produced.
       (C) Motor vehicles.--
       (i) Basis of calculation.--For purposes of determining the 
     regional value-content under subparagraph (A) for an 
     automotive good that is a motor vehicle provided for in any 
     of headings 8701 through 8705, an importer, exporter, or 
     producer may average the amounts calculated under the formula 
     contained in subparagraph (A), over the producer's fiscal 
     year--

       (I) with respect to all motor vehicles in any one of the 
     categories described in clause (ii); or
       (II) with respect to all motor vehicles in any such 
     category that are exported to the territory of the United 
     States or Australia.

       (ii) Categories.--A category is described in this clause if 
     it--

       (I) is the same model line of motor vehicles, is in the 
     same class of vehicles, and is produced in the same plant in 
     the territory of Australia or the United States, as the good 
     described in clause (i) for which regional value-content is 
     being calculated;
       (II) is the same class of motor vehicles, and is produced 
     in the same plant in the territory of Australia or the United 
     States, as the good described in clause (i) for which 
     regional value-content is being calculated; or
       (III) is the same model line of motor vehicles produced in 
     either the territory of Australia or the United States, as 
     the good described in clause (i) for which regional value-
     content is being calculated.

       (D) Other automotive goods.--For purposes of determining 
     the regional value-content under subparagraph (A) for 
     automotive goods provided for in any of subheadings 8407.31 
     through 8407.34, in subheading 8408.20, or in heading 8409, 
     8706, 8707, or 8708, that are produced in the same plant, an 
     importer, exporter, or producer may--
       (i) average the amounts calculated under the formula 
     contained in subparagraph (A) over--

       (I) the fiscal year of the motor vehicle producer to whom 
     the automotive goods are sold,
       (II) any quarter or month, or
       (III) its own fiscal year,

     if the goods were produced during the fiscal year, quarter, 
     or month that is the basis for the calculation;
       (ii) determine the average referred to in clause (i) 
     separately for such goods sold to one or more motor vehicle 
     producers; or
       (iii) make a separate determination under clause (i) or 
     (ii) for automotive goods that are exported to the territory 
     of the United States or Australia.
       (E) Calculating net cost.--Consistent with the provisions 
     regarding allocation of costs set out in generally accepted 
     accounting principles, the net cost of the automotive good 
     under subparagraph (B) shall be calculated by--
       (i) calculating the total cost incurred with respect to all 
     goods produced by the producer of the automotive good, 
     subtracting any sales promotion, marketing and after-sales 
     service costs, royalties, shipping and packing costs, and 
     nonallowable interest costs that are included in the total 
     cost of all such goods, and then reasonably allocating the 
     resulting net cost of those goods to the automotive good;

[[Page H5694]]

       (ii) calculating the total cost incurred with respect to 
     all goods produced by that producer, reasonably allocating 
     the total cost to the automotive good, and then subtracting 
     any sales promotion, marketing and after-sales service costs, 
     royalties, shipping and packing costs, and nonallowable 
     interest costs that are included in the portion of the total 
     cost allocated to the automotive good; or
       (iii) reasonably allocating each cost that forms part of 
     the total cost incurred with respect to the automotive good 
     so that the aggregate of these costs does not include any 
     sales promotion, marketing and after-sales service costs, 
     royalties, shipping and packing costs, or nonallowable 
     interest costs.
       (f) Value of Materials.--
       (1) In general.--For the purpose of calculating the 
     regional value-content of a good under subsection (e), and 
     for purposes of applying the de minimis rules under 
     subsection (c), the value of a material is--
       (A) in the case of a material that is imported by the 
     producer of the good, the adjusted value of the material;
       (B) in the case of a material acquired in the territory in 
     which the good is produced, the value, determined in 
     accordance with Articles 1 through 8, article 15, and the 
     corresponding interpretive notes of the Agreement on 
     Implementation of Article VII of the General Agreement on 
     Tariffs and Trade 1994 referred to in section 101(d)(8) of 
     the Uruguay Round Agreements Act, as set forth in regulations 
     promulgated by the Secretary of the Treasury providing for 
     the application of such Articles in the absence of an 
     importation; or
       (C) in the case of a material that is self-produced, the 
     sum of--
       (i) all expenses incurred in the production of the 
     material, including general expenses; and
       (ii) an amount for profit equivalent to the profit added in 
     the normal course of trade.
       (2) Further adjustments to the value of materials.--
       (A) Originating material.--The following expenses, if not 
     included in the value of an originating material calculated 
     under paragraph (1), may be added to the value of the 
     originating material:
       (i) The costs of freight, insurance, packing, and all other 
     costs incurred in transporting the material within or between 
     the territory of Australia, the United States, or both, to 
     the location of the producer.
       (ii) Duties, taxes, and customs brokerage fees on the 
     material paid in the territory of Australia, the United 
     States, or both, other than duties or taxes that are waived, 
     refunded, refundable, or otherwise recoverable, including 
     credit against duty or tax paid or payable.
       (iii) The cost of waste and spoilage resulting from the use 
     of the material in the production of the good, less the value 
     of renewable scrap or byproducts.
       (B) Nonoriginating material.--The following expenses, if 
     included in the value of a nonoriginating material calculated 
     under paragraph (1), may be deducted from the value of the 
     nonoriginating material:
       (i) The costs of freight, insurance, packing, and all other 
     costs incurred in transporting the material within or between 
     the territory of Australia, the United States, or both, to 
     the location of the producer.
       (ii) Duties, taxes, and customs brokerage fees on the 
     material paid in the territory of Australia, the United 
     States, or both, other than duties or taxes that are waived, 
     refunded, refundable, or otherwise recoverable, including 
     credit against duty or tax paid or payable.
       (iii) The cost of waste and spoilage resulting from the use 
     of the material in the production of the good, less the value 
     of renewable scrap or byproducts.
       (iv) The cost of processing incurred in the territory of 
     Australia, the United States, or both, in the production of 
     the nonoriginating material.
       (v) The cost of originating materials used in the 
     production of the nonoriginating material in the territory of 
     Australia, the United States, or both.
       (g) Accessories, Spare Parts, or Tools.--
       (1) In general.--Subject to paragraph (2), accessories, 
     spare parts, or tools delivered with a good that form part of 
     the good's standard accessories, spare parts, or tools 
     shall--
       (A) be treated as originating goods if the good is an 
     originating good; and
       (B) be disregarded in determining whether all the 
     nonoriginating materials used in the production of the good 
     undergo the applicable change in tariff classification set 
     out in Annex 5-A of the Agreement.
       (2) Conditions.--Paragraph (1) shall apply only if--
       (A) the accessories, spare parts, or tools are not invoiced 
     separately from the good;
       (B) the quantities and value of the accessories, spare 
     parts, or tools are customary for the good; and
       (C) if the good is subject to a regional value-content 
     requirement, the value of the accessories, spare parts, or 
     tools is taken into account as originating or nonoriginating 
     materials, as the case may be, in calculating the regional 
     value-content of the good.
       (h) Fungible Goods and Materials.--
       (1) In general.--
       (A) Claim for preferential treatment.--A person claiming 
     that a fungible good or fungible material is an originating 
     good may base the claim either on the physical segregation of 
     the fungible good or fungible material or by using an 
     inventory management method with respect to the fungible good 
     or fungible material.
       (B) Inventory management method.--In this subsection, the 
     term ``inventory management method'' means--
       (i) averaging;
       (ii) ``last-in, first-out'';
       (iii) ``first-in, first-out''; or
       (iv) any other method--

       (I) recognized in the generally accepted accounting 
     principles of the country in which the production is 
     performed (whether Australia or the United States); or
       (II) otherwise accepted by that country.

       (2) Election of inventory method.--A person selecting an 
     inventory management method under paragraph (1) for a 
     particular fungible good or fungible material shall continue 
     to use that method for that fungible good or fungible 
     material throughout the fiscal year of that person.
       (i) Packaging Materials and Containers for Retail Sale.--
     Packaging materials and containers in which a good is 
     packaged for retail sale, if classified with the good, shall 
     be disregarded in determining whether all the nonoriginating 
     materials used in the production of the good undergo the 
     applicable change in tariff classification set out in Annex 
     4-A or Annex 5-A of the Agreement, and, if the good is 
     subject to a regional value-content requirement, the value of 
     such packaging materials and containers shall be taken into 
     account as originating or nonoriginating materials, as the 
     case may be, in calculating the regional value-content of the 
     good.
       (j) Packing Materials and Containers for Shipment.--Packing 
     materials and containers for shipment shall be disregarded in 
     determining whether--
       (1) the nonoriginating materials used in the production of 
     a good undergo the applicable change in tariff classification 
     set out in Annex 4-A or Annex 5-A of the Agreement; and
       (2) the good satisfies a regional value-content 
     requirement.
       (k) Indirect Materials.--An indirect material shall be 
     treated as an originating material without regard to where it 
     is produced, and its value shall be the cost registered in 
     the accounting records of the producer of the good.
       (l) Third Country Operations.--A good that has undergone 
     production necessary to qualify as an originating good under 
     subsection (b) shall not be considered to be an originating 
     good if, subsequent to that production, the good undergoes 
     further production or any other operation outside the 
     territory of Australia or the United States, other than 
     unloading, reloading, or any other operation necessary to 
     preserve the good in good condition or to transport the good 
     to the territory of Australia or the United States.
       (m) Textile and Apparel Goods Classifiable as Goods Put Up 
     in Sets.--Notwithstanding the rules set forth in Annex 4-A of 
     the Agreement, textile or apparel goods classifiable as goods 
     put up in sets for retail sale as provided for in General 
     Rule of Interpretation 3 of the HTS shall not be considered 
     to be originating goods unless each of the goods in the set 
     is an originating good or the total value of the 
     nonoriginating goods in the set does not exceed 10 percent of 
     the value of the set determined for purposes of assessing 
     customs duties.
       (n) Definitions.--In this section:
       (1) Adjusted value.--The term ``adjusted value'' means the 
     value determined under Articles 1 through 8, Article 15, and 
     the corresponding interpretive notes of the Agreement on 
     Implementation of Article VII of the General Agreement on 
     Tariffs and Trade 1994 referred to in section 101(d)(8) of 
     the Uruguay Round Agreements Act, adjusted to exclude any 
     costs, charges, or expenses incurred for transportation, 
     insurance, and related services incident to the 
     international shipment of the good from the country of 
     exportation to the place of importation.
       (2) Class of motor vehicles.--The term ``class of motor 
     vehicles'' means any one of the following categories of motor 
     vehicles:
       (A) Motor vehicles provided for in subheading 8701.20, 
     8704.10, 8704.22, 8704.23, 8704.32, or 8704.90, or heading 
     8705 or 8706, or motor vehicles for the transport of 16 or 
     more persons provided for in subheading 8702.10 or 8702.90.
       (B) Motor vehicles provided for in subheading 8701.10 or 
     any of subheadings 8701.30 through 8701.90.
       (C) Motor vehicles for the transport of 15 or fewer persons 
     provided for in subheading 8702.10 or 8702.90, or motor 
     vehicles provided for in subheading 8704.21 or 8704.31.
       (D) Motor vehicles provided for in any of subheadings 
     8703.21 through 8703.90.
       (3) Fungible good or fungible material.--The term 
     ``fungible good'' or ``fungible material'' means a good or 
     material, as the case may be, that is interchangeable with 
     another good or material for commercial purposes and the 
     properties of which are essentially identical to such other 
     good or material.
       (4) Generally accepted accounting principles.--The term 
     ``generally accepted accounting principles'' means the 
     recognized consensus or substantial authoritative support in 
     the territory of Australia or the United States, as the case 
     may be, with respect to the recording of revenues, expenses, 
     costs, assets, and liabilities, the disclosure of 
     information, and the preparation of financial statements. 
     These standards may encompass broad guidelines of general 
     application as well as detailed standards, practices, and 
     procedures.

[[Page H5695]]

       (5) Good wholly obtained or produced entirely in the 
     territory of australia, the united states, or both.--The term 
     ``good wholly obtained or produced entirely in the territory 
     of Australia, the United States, or both'' means--
       (A) a mineral good extracted in the territory of Australia, 
     the United States, or both;
       (B) a vegetable good, as such goods are provided for in the 
     HTS, harvested in the territory of Australia, the United 
     States, or both;
       (C) a live animal born and raised in the territory of 
     Australia, the United States, or both;
       (D) a good obtained from hunting, trapping, fishing, or 
     aquaculture conducted in the territory of Australia, the 
     United States, or both;
       (E) a good (fish, shellfish, and other marine life) taken 
     from the sea by vessels registered or recorded with Australia 
     or the United States and flying the flag of that country;
       (F) a good produced exclusively from products referred to 
     in subparagraph (E) on board factory ships registered or 
     recorded with Australia or the United States and flying the 
     flag of that country;
       (G) a good taken by Australia or the United States or a 
     person of Australia or the United States from the seabed or 
     beneath the seabed outside territorial waters, if Australia 
     or the United States has rights to exploit such seabed;
       (H) a good taken from outer space, if such good is obtained 
     by Australia or the United States or a person of Australia or 
     the United States and not processed in the territory of a 
     country other than Australia or the United States;
       (I) waste and scrap derived from--
       (i) production in the territory of Australia, the United 
     States, or both; or
       (ii) used goods collected in the territory of Australia, 
     the United States, or both, if such goods are fit only for 
     the recovery of raw materials;
       (J) a recovered good derived in the territory of Australia 
     or the United States from goods that have passed their life 
     expectancy, or are no longer usable due to defects, and 
     utilized in the territory of that country in the production 
     of remanufactured goods; or
       (K) a good produced in the territory of Australia, the 
     United States, or both, exclusively--
       (i) from goods referred to in any of subparagraphs (A) 
     through (I), or
       (ii) from the derivatives of goods referred to in clause 
     (i),
     at any stage of production.
       (6) Indirect material.--The term ``indirect material'' 
     means a good used in the production, testing, or inspection 
     of a good but not physically incorporated into the good, or a 
     good used in the maintenance of buildings or the operation of 
     equipment associated with the production of a good, 
     including--
       (A) fuel and energy;
       (B) tools, dies, and molds;
       (C) spare parts and materials used in the maintenance of 
     equipment or buildings;
       (D) lubricants, greases, compounding materials, and other 
     materials used in production or used to operate equipment or 
     buildings;
       (E) gloves, glasses, footwear, clothing, safety equipment, 
     and supplies;
       (F) equipment, devices, and supplies used for testing or 
     inspecting the good;
       (G) catalysts and solvents; and
       (H) any other goods that are not incorporated into the good 
     but the use of which in the production of the good can 
     reasonably be demonstrated to be a part of that production.
       (7) Material.--The term ``material'' means a good that is 
     used in the production of another good.
       (8) Material that is self-produced.--The term ``material 
     that is self-produced'' means an originating material that is 
     produced by a producer of a good and used in the production 
     of that good.
       (9) Model line.--The term ``model line'' means a group of 
     motor vehicles having the same platform or model name.
       (10) Nonallowable interest costs.--The term ``nonallowable 
     interest costs'' means interest costs incurred by a producer 
     that exceed 700 basis points above the applicable official 
     interest rate for comparable maturities of the country 
     (whether Australia or the United States).
       (11) Nonoriginating material.--The term ``nonoriginating 
     material'' means a material that does not qualify as 
     originating under this section.
       (12) Preferential treatment.--The term ``preferential 
     treatment'' means the customs duty rate, and the treatment 
     under article 2.12 of the Agreement, that are applicable to 
     an originating good pursuant to the Agreement.
       (13) Producer.--The term ``producer'' means a person who 
     engages in the production of a good in the territory of 
     Australia or the United States.
       (14) Production.--The term ``production'' means growing, 
     raising, mining, harvesting, fishing, trapping, hunting, 
     manufacturing, processing, assembling, or disassembling a 
     good.
       (15) Reasonably allocate.--The term ``reasonably allocate'' 
     means to apportion in a manner that would be appropriate 
     under generally accepted accounting principles.
       (16) Recovered goods.--The term ``recovered goods'' means 
     materials in the form of individual parts that result from--
       (A) the complete disassembly of goods which have passed 
     their life expectancy, or are no longer usable due to 
     defects, into individual parts; and
       (B) the cleaning, inspecting, or testing, or other 
     processing that is necessary for improvement to sound working 
     condition of such individual parts.
       (17) Remanufactured good.--The term ``remanufactured good'' 
     means an industrial good that is assembled in the territory 
     of Australia or the United States, that is classified under 
     chapter 84, 85, or 87 of the HTS or heading 9026, 9031, or 
     9032, other than a good classified under heading 8418 or 8516 
     or any of headings 8701 through 8706, and that--
       (A) is entirely or partially comprised of recovered goods;
       (B) has a similar life expectancy to, and meets the same 
     performance standards as, a like good that is new; and
       (C) enjoys a factory warranty similar to a like good that 
     is new.
       (18) Total cost.--The term ``total cost'' means all product 
     costs, period costs, and other costs for a good incurred in 
     the territory of Australia, the United States, or both.
       (19) Used.--The term ``used'' means used or consumed in the 
     production of goods.
       (o) Presidential Proclamation Authority.--
       (1) In general.--The President is authorized to proclaim, 
     as part of the HTS--
       (A) the provisions set out in Annex 4-A and Annex 5-A of 
     the Agreement; and
       (B) any additional subordinate category necessary to carry 
     out this title consistent with the Agreement.
       (2) Modifications.--
       (A) In general.--Subject to the consultation and layover 
     provisions of section 104, the President may proclaim 
     modifications to the provisions proclaimed under the 
     authority of paragraph (1)(A), other than provisions of 
     chapters 50 through 63 of the HTS, as included in Annex 4-A 
     of the Agreement.
       (B) Additional proclamations.--Notwithstanding subparagraph 
     (A), and subject to the consultation and layover provisions 
     of section 104, the President may proclaim--
       (i) modifications to the provisions proclaimed under the 
     authority of paragraph (1)(A) as are necessary to implement 
     an agreement with Australia pursuant to article 4.2.5 of the 
     Agreement; and
       (ii) before the end of the 1-year period beginning on the 
     date of the enactment of this Act, modifications to correct 
     any typographical, clerical, or other nonsubstantive 
     technical error regarding the provisions of chapters 50 
     through 63 of the HTS, as included in Annex 4-A of the 
     Agreement.

     SEC. 204. CUSTOMS USER FEES.

       Section 13031(b) of the Consolidated Omnibus Budget 
     Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by 
     adding after paragraph (13) the following:
       ``(14) No fee may be charged under subsection (a) (9) or 
     (10) with respect to goods that qualify as originating goods 
     under section 203 of the United States-Australia Free Trade 
     Agreement Implementation Act. Any service for which an 
     exemption from such fee is provided by reason of this 
     paragraph may not be funded with money contained in the 
     Customs User Fee Account.''.

     SEC. 205. DISCLOSURE OF INCORRECT INFORMATION.

       Section 592(c) of the Tariff Act of 1930 (19 U.S.C. 
     1592(c)) is amended--
       (1) by redesignating paragraph (8) as paragraph (9); and
       (2) by inserting after paragraph (7) the following new 
     paragraph:
       ``(8) Prior disclosure regarding claims under the united 
     states-australia free trade agreement.--
       ``(A) In general.--An importer shall not be subject to 
     penalties under subsection (a) for making an incorrect claim 
     that a good qualifies as an originating good under section 
     203 of the United States-Australia Free Trade Agreement 
     Implementation Act if the importer, in accordance with 
     regulations issued by the Secretary of the Treasury, 
     voluntarily and promptly makes a corrected declaration and 
     pays any duties owing.
       ``(B) Time periods for making corrections.--In the 
     regulations referred to in subparagraph (A), the Secretary of 
     the Treasury is authorized to prescribe time periods for 
     making a corrected declaration and paying duties owing under 
     subparagraph (A), if such periods are not shorter than 1 year 
     following the date on which the importer makes the incorrect 
     claim.''.

     SEC. 206. ENFORCEMENT RELATING TO TRADE IN TEXTILE AND 
                   APPAREL GOODS.

       (a) Action During Verification.--
       (1) In general.--If the Secretary of the Treasury requests 
     the Government of Australia to conduct a verification 
     pursuant to article 4.3 of the Agreement for purposes of 
     making a determination under paragraph (2), the President may 
     direct the Secretary to take appropriate action described in 
     subsection (b) while the verification is being conducted.
       (2) Determination.--A determination under this paragraph is 
     a determination--
       (A) that an exporter or producer in Australia is complying 
     with applicable customs laws, regulations, procedures, 
     requirements, or practices affecting trade in textile or 
     apparel goods; or
       (B) that a claim that a textile or apparel good exported or 
     produced by such exporter or producer--
       (i) qualifies as an originating good under section 203 of 
     this Act; or
       (ii) is a good of Australia,
     is accurate.

[[Page H5696]]

       (b) Appropriate Action Described.--Appropriate action under 
     subsection (a)(1) includes--
       (1) suspension of liquidation of the entry of any textile 
     or apparel good exported or produced by the person that is 
     the subject of a verification under subsection (a)(1) 
     regarding compliance described in subsection (a)(2)(A), in a 
     case in which the request for verification was based on a 
     reasonable suspicion of unlawful activity related to such 
     goods; and
       (2) suspension of liquidation of the entry of a textile or 
     apparel good for which a claim has been made that is the 
     subject of a verification under subsection (a)(1) regarding a 
     claim described in subsection (a)(2)(B).
       (c) Action When Information is Insufficient.--If the 
     Secretary of the Treasury determines that the information 
     obtained within 12 months after making a request for a 
     verification under subsection (a)(1) is insufficient to make 
     a determination under subsection (a)(2), the President may 
     direct the Secretary to take appropriate action described in 
     subsection (d) until such time as the Secretary receives 
     information sufficient to make a determination under 
     subsection (a)(2) or until such earlier date as the President 
     may direct.
       (d) Appropriate Action Described.--Appropriate action 
     referred to in subsection (c) includes--
       (1) publication of the name and address of the person that 
     is the subject of the verification;
       (2) denial of preferential tariff treatment under the 
     Agreement to--
       (A) any textile or apparel good exported or produced by the 
     person that is the subject of a verification under subsection 
     (a)(1) regarding compliance described in subsection 
     (a)(2)(A); or
       (B) a textile or apparel good for which a claim has been 
     made that is the subject of a verification under subsection 
     (a)(1) regarding a claim described in subsection (a)(2)(B); 
     and
       (3) denial of entry into the United States of--
       (A) any textile or apparel good exported or produced by the 
     person that is the subject of a verification under subsection 
     (a)(1) regarding compliance described in subsection 
     (a)(2)(A); or
       (B) a textile or apparel good for which a claim has been 
     made that is the subject of a verification under subsection 
     (a)(1) regarding a claim described in subsection (a)(2)(B).

     SEC. 207. REGULATIONS.

       The Secretary of the Treasury shall prescribe such 
     regulations as may be necessary to carry out--
       (1) subsections (a) through (n) of section 203 and section 
     204;
       (2) amendments to existing law made by the sections 
     referred to in paragraph (1); and
       (3) proclamations issued under section 203(o).

                     TITLE III--RELIEF FROM IMPORTS

     SEC. 301. DEFINITIONS.

        As used in this title:
       (1) Australian article.--The term ``Australian article'' 
     means an article that qualifies as an originating good under 
     section 203(b) of this Act.
       (2) Australian textile or apparel article.--The term 
     ``Australian textile or apparel article'' means an article--
       (A) that is listed in the Annex to the Agreement on 
     Textiles and Clothing referred to in section 101(d)(4) of the 
     Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)); and
       (B) that is an Australian article.
       (3) Commission.--The term ``Commission'' means the United 
     States International Trade Commission.

     Subtitle A--Relief From Imports Benefiting From the Agreement

     SEC. 311. COMMENCING OF ACTION FOR RELIEF.

       (a) Filing of Petition.--
       (1) In general.--A petition requesting action under this 
     subtitle for the purpose of adjusting to the obligations of 
     the United States under the Agreement may be filed with the 
     Commission by an entity, including a trade association, firm, 
     certified or recognized union, or group of workers, that is 
     representative of an industry. The Commission shall transmit 
     a copy of any petition filed under this subsection to the 
     United States Trade Representative.
       (2) Provisional relief.--An entity filing a petition under 
     this subsection may request that provisional relief be 
     provided as if the petition had been filed under section 
     202(a) of the Trade Act of 1974 (19 U.S.C. 2252(a)).
       (3) Critical circumstances.--Any allegation that critical 
     circumstances exist shall be included in the petition.
       (b) Investigation and Determination.--Upon the filing of a 
     petition under subsection (a), the Commission, unless 
     subsection (d) applies, shall promptly initiate an 
     investigation to determine whether, as a result of the 
     reduction or elimination of a duty provided for under the 
     Agreement, an Australian article is being imported into the 
     United States in such increased quantities, in absolute terms 
     or relative to domestic production, and under such conditions 
     that imports of the Australian article constitute a 
     substantial cause of serious injury or threat thereof to the 
     domestic industry producing an article that is like, or 
     directly competitive with, the imported article.
       (c) Applicable Provisions.--The following provisions of 
     section 202 of the Trade Act of 1974 (19 U.S.C. 2252) apply 
     with respect to any investigation initiated under subsection 
     (b):
       (1) Paragraphs (1)(B) and (3) of subsection (b).
       (2) Subsection (c).
       (3) Subsection (d).
       (4) Subsection (i).
       (d) Articles Exempt From Investigation.--No investigation 
     may be initiated under this section with respect to any 
     Australian article if, after the date on which the Agreement 
     enters into force, import relief has been provided with 
     respect to that Australian article under this subtitle.

     SEC. 312. COMMISSION ACTION ON PETITION.

       (a) Determination.--Not later than 120 days (180 days if 
     critical circumstances have been alleged) after the date on 
     which an investigation is initiated under section 311(b) with 
     respect to a petition, the Commission shall make the 
     determination required under that section.
       (b) Applicable Provisions.--For purposes of this subtitle, 
     the provisions of paragraphs (1), (2), and (3) of section 
     330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2), 
     and (3)) shall be applied with respect to determinations and 
     findings made under this section as if such determinations 
     and findings were made under section 202 of the Trade Act of 
     1974 (19 U.S.C. 2252).
       (c) Additional Finding and Recommendation if Determination 
     Affirmative.--If the determination made by the Commission 
     under subsection (a) with respect to imports of an article is 
     affirmative, or if the President may consider a determination 
     of the Commission to be an affirmative determination as 
     provided for under paragraph (1) of section 330(d) of the 
     Tariff Act of 1930) (19 U.S.C. 1330(d)), the Commission shall 
     find, and recommend to the President in the report required 
     under subsection (d), the amount of import relief that is 
     necessary to remedy or prevent the injury found by the 
     Commission in the determination and to facilitate the efforts 
     of the domestic industry to make a positive adjustment to 
     import competition. The import relief recommended by the 
     Commission under this subsection shall be limited to that 
     described in section 313(c). Only those members of the 
     Commission who voted in the affirmative under subsection (a) 
     are eligible to vote on the proposed action to remedy or 
     prevent the injury found by the Commission. Members of the 
     Commission who did not vote in the affirmative may submit, in 
     the report required under subsection (d), separate views 
     regarding what action, if any, should be taken to remedy or 
     prevent the injury.
       (d) Report to President.--Not later than the date that is 
     30 days after the date on which a determination is made under 
     subsection (a) with respect to an investigation, the 
     Commission shall submit to the President a report that 
     includes--
       (1) the determination made under subsection (a) and an 
     explanation of the basis for the determination;
       (2) if the determination under subsection (a) is 
     affirmative, any findings and recommendations for import 
     relief made under subsection (c) and an explanation of the 
     basis for each recommendation; and
       (3) any dissenting or separate views by members of the 
     Commission regarding the determination and recommendation 
     referred to in paragraphs (1) and (2).
       (e) Public Notice.--Upon submitting a report to the 
     President under subsection (d), the Commission shall promptly 
     make public such report (with the exception of information 
     which the Commission determines to be confidential) and shall 
     cause a summary thereof to be published in the Federal 
     Register.

     SEC. 313. PROVISION OF RELIEF.

       (a) In General.--Not later than the date that is 30 days 
     after the date on which the President receives the report of 
     the Commission in which the Commission's determination under 
     section 312(a) is affirmative, or which contains a 
     determination under section 312(a) that the President 
     considers to be affirmative under paragraph (1) of section 
     330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)(1)), the 
     President, subject to subsection (b), shall provide relief 
     from imports of the article that is the subject of such 
     determination to the extent that the President determines 
     necessary to remedy or prevent the injury found by the 
     Commission and to facilitate the efforts of the domestic 
     industry to make a positive adjustment to import competition.
       (b) Exception.--The President is not required to provide 
     import relief under this section if the President determines 
     that the provision of the import relief will not provide 
     greater economic and social benefits than costs.
       (c) Nature of Relief.--
       (1) In general.--The import relief (including provisional 
     relief) that the President is authorized to provide under 
     this section with respect to imports of an article is as 
     follows:
       (A) The suspension of any further reduction provided for 
     under Annex 2-B of the Agreement in the duty imposed on such 
     article.
       (B) An increase in the rate of duty imposed on such article 
     to a level that does not exceed the lesser of--
       (i) the column 1 general rate of duty imposed under the HTS 
     on like articles at the time the import relief is provided; 
     or
       (ii) the column 1 general rate of duty imposed under the 
     HTS on like articles on the day before the date on which the 
     Agreement enters into force.
       (C) In the case of a duty applied on a seasonal basis to 
     such article, an increase in the

[[Page H5697]]

     rate of duty imposed on the article to a level that does not 
     exceed the lesser of--
       (i) the column 1 general rate of duty imposed under the HTS 
     on like articles for the immediately preceding corresponding 
     season; or
       (ii) the column 1 general rate of duty imposed under the 
     HTS on like articles on the day before the date on which the 
     Agreement enters into force.
       (2) Progressive liberalization.--If the period for which 
     import relief is provided under this section is greater than 
     1 year, the President shall provide for the progressive 
     liberalization (described in article 9.2.7 of the Agreement) 
     of such relief at regular intervals during the period in 
     which the relief is in effect.
       (d) Period of Relief.--
       (1) In general.--Subject to paragraph (2), any import 
     relief that the President provides under this section may not 
     be in effect for more than 2 years.
       (2) Extension.--
       (A) In general.--Subject to subparagraph (C), the 
     President, after receiving an affirmative determination from 
     the Commission under subparagraph (B), may extend the 
     effective period of any import relief provided under this 
     section if the President determines that--
       (i) the import relief continues to be necessary to remedy 
     or prevent serious injury and to facilitate adjustment by the 
     domestic industry to import competition; and
       (ii) there is evidence that the industry is making a 
     positive adjustment to import competition.
       (B) Action by commission.--(i) Upon a petition on behalf of 
     the industry concerned that is filed with the Commission not 
     earlier than the date which is 9 months, and not later than 
     the date which is 6 months, before the date any action taken 
     under subsection (a) is to terminate, the Commission shall 
     conduct an investigation to determine whether action under 
     this section continues to be necessary to remedy or prevent 
     serious injury and whether there is evidence that the 
     industry is making a positive adjustment to import 
     competition.
       (ii) The Commission shall publish notice of the 
     commencement of any proceeding under this subparagraph in the 
     Federal Register and shall, within a reasonable time 
     thereafter, hold a public hearing at which the Commission 
     shall afford interested parties and consumers an opportunity 
     to be present, to present evidence, and to respond to the 
     presentations of other parties and consumers, and otherwise 
     to be heard.
       (iii) The Commission shall transmit to the President a 
     report on its investigation and determination under this 
     subparagraph not later than 60 days before the action under 
     subsection (a) is to terminate, unless the President 
     specifies a different date.
       (C) Period of import relief.--Any import relief provided 
     under this section, including any extensions thereof, may 
     not, in the aggregate, be in effect for more than 4 years.
       (e) Rate After Termination of Import Relief.--When import 
     relief under this section is terminated with respect to an 
     article--
       (1) the rate of duty on that article after such termination 
     and on or before December 31 of the year in which such 
     termination occurs shall be the rate that, according to the 
     Schedule of the United States to Annex 2-B of the Agreement 
     for the staged elimination of the tariff, would have been in 
     effect 1 year after the provision of relief under subsection 
     (a); and
       (2) the rate of duty for that article after December 31 of 
     the year in which termination occurs shall be, at the 
     discretion of the President, either--
       (A) the applicable NTR (MFN) rate of duty for that article 
     set out in the Schedule of the United States to Annex 2-B of 
     the Agreement; or
       (B) the rate of duty resulting from the elimination of the 
     tariff in equal annual stages ending on the date set out in 
     the Schedule of the United States to Annex 2-B of the 
     Agreement for the elimination of the tariff.
       (f) Articles Exempt From Relief.--No import relief may be 
     provided under this section on any article that--
       (1) is subject to--
       (A) import relief under subtitle B; or
       (B) an assessment of additional duty under subsection (b), 
     (c), or (d) of section 202; or
       (2) has been subject to import relief under this subtitle 
     after the date on which the Agreement enters into force.

     SEC. 314. TERMINATION OF RELIEF AUTHORITY.

       (a) General Rule.--Subject to subsection (b), no import 
     relief may be provided under this subtitle after the date 
     that is 10 years after the date on which the Agreement enters 
     into force.
       (b) Exception.--If an article for which relief is provided 
     under this subtitle is an article for which the period for 
     tariff elimination, set out in the Schedule of the United 
     States to Annex 2-B of the Agreement, is greater than 10 
     years, no relief under this subtitle may be provided for 
     that article after the date on which such period ends.
       (c) Presidential Determination.--Import relief may be 
     provided under this subtitle in the case of an Australian 
     article after the date on which such relief would, but for 
     this subsection, terminate under subsection (a) or (b), if 
     the President determines that Australia has consented to such 
     relief.

     SEC. 315. COMPENSATION AUTHORITY.

       For purposes of section 123 of the Trade Act of 1974 (19 
     U.S.C. 2133), any import relief provided by the President 
     under section 313 shall be treated as action taken under 
     chapter 1 of title II of such Act.

     SEC. 316. CONFIDENTIAL BUSINESS INFORMATION.

       Section 202(a)(8) of the Trade Act of 1974 (19 U.S.C. 
     2252(a)(8)) is amended in the first sentence--
       (1) by striking ``and''; and
       (2) by inserting before the period at the end ``, and title 
     III of the United States-Australia Free Trade Agreement 
     Implementation Act''.

           Subtitle B--Textile and Apparel Safeguard Measures

     SEC. 321. COMMENCEMENT OF ACTION FOR RELIEF.

       (a) In General.--A request under this subtitle for the 
     purpose of adjusting to the obligations of the United States 
     under the Agreement may be filed with the President by an 
     interested party. Upon the filing of a request, the President 
     shall review the request to determine, from information 
     presented in the request, whether to commence consideration 
     of the request.
       (b) Allegation of Critical Circumstances.--An interested 
     party filing a request under this section may--
       (1) allege that critical circumstances exist such that 
     delay in the provision of relief would cause damage that 
     would be difficult to repair; and
       (2) based on such allegation, request that relief be 
     provided on a provisional basis.
       (c) Publication of Request.--If the President determines 
     that the request under subsection (a) provides the 
     information necessary for the request to be considered, the 
     President shall cause to be published in the Federal Register 
     a notice of commencement of consideration of the request, and 
     notice seeking public comments regarding the request. The 
     notice shall include a summary of the request and the dates 
     by which comments and rebuttals must be received.

     SEC. 322. DETERMINATION AND PROVISION OF RELIEF.

       (a) Determination.--
       (1) In general.--If a positive determination is made under 
     section 321(c), the President shall determine whether, as a 
     result of the reduction or elimination of a duty under the 
     Agreement, an Australian textile or apparel article is being 
     imported into the United States in such increased quantities, 
     in absolute terms or relative to the domestic market for that 
     article, and under such conditions as to cause serious 
     damage, or actual threat thereof, to a domestic industry 
     producing an article that is like, or directly competitive 
     with, the imported article.
       (2) Serious damage.--In making a determination under 
     paragraph (1), the President--
       (A) shall examine the effect of increased imports on the 
     domestic industry, as reflected in changes in such relevant 
     economic factors as output, productivity, utilization of 
     capacity, inventories, market share, exports, wages, 
     employment, domestic prices, profits, and investment, none of 
     which is necessarily decisive; and
       (B) shall not consider changes in technology or consumer 
     preference as factors supporting a determination of serious 
     damage or actual threat thereof.
       (b) Provision of Relief.--
       (1) In general.--If a determination under subsection (a) is 
     affirmative, the President may provide relief from imports of 
     the article that is the subject of such determination, as 
     described in paragraph (2), to the extent that the President 
     determines necessary to remedy or prevent the serious damage 
     and to facilitate adjustment by the domestic industry to 
     import competition.
       (2) Nature of relief.--The relief that the President is 
     authorized to provide under this subsection with respect to 
     imports of an article is an increase in the rate of duty 
     imposed on the article to a level that does not exceed the 
     lesser of--
       (A) the column 1 general rate of duty imposed under the HTS 
     on like articles at the time the import relief is provided; 
     or
       (B) the column 1 general rate of duty imposed under the HTS 
     on like articles on the day before the date on which the 
     Agreement enters into force.
       (c) Critical Circumstances.--
       (1) Presidential determination.--When a request filed under 
     section 321(a) contains an allegation of critical 
     circumstances and a request for provisional relief under 
     section 321(b), the President shall, not later than 60 days 
     after the request is filed, determine, on the basis of 
     available information, whether--
       (A) there is clear evidence that--
       (i) imports from Australia have increased as the result of 
     the reduction or elimination of a customs duty under the 
     Agreement; and
       (ii) such imports are causing serious damage, or actual 
     threat thereof, to the domestic industry producing an article 
     like or directly competitive with the imported article; and
       (B) delay in taking action under this subtitle would cause 
     damage to that industry that would be difficult to repair.
       (2) Extent of provisional relief.--If the determinations 
     under subparagraphs (A) and (B) of paragraph (1) are 
     affirmative, the President shall determine the extent of 
     provisional relief that is necessary to remedy or prevent the 
     serious damage. The nature of the provisional relief 
     available shall be the relief described in subsection (b)(2). 
     Within 30 days after making affirmative determinations under 
     subparagraphs (A) and (B) of paragraph (1), the President, if 
     the President considers provisional relief to be warranted,

[[Page H5698]]

     shall provide, for a period not to exceed 200 days, such 
     provisional relief that the President considers necessary 
     to remedy or prevent the serious damage.
       (3) Suspension of liquidation.--If provisional relief is 
     provided under paragraph (2), the President shall order the 
     suspension of liquidation of all imported articles subject to 
     the affirmative determinations under subparagraphs (A) and 
     (B) of paragraph (1) that are entered, or withdrawn from 
     warehouse for consumption, on or after the date of the 
     determinations.
       (4) Termination of provisional relief.--
       (A) In general.--Any provisional relief implemented under 
     this subsection with respect to an imported article shall 
     terminate on the day on which--
       (i) the President makes a negative determination under 
     subsection (a) regarding serious damage or actual threat 
     thereof by imports of such article;
       (ii) action described in subsection (b) takes effect with 
     respect to such article;
       (iii) a decision by the President not to take any action 
     under subsection (b) with respect to such article becomes 
     final; or
       (iv) the President determines that, because of changed 
     circumstances, such relief is no longer warranted.
       (B) Suspension of liquidation.--Any suspension of 
     liquidation ordered under paragraph (3) with respect to an 
     imported article shall terminate on the day on which 
     provisional relief is terminated under subparagraph (A) with 
     respect to the article.
       (C) Rates of duty.--If an increase in, or the imposition 
     of, a duty that is provided under subsection (b) on an 
     imported article is different from a duty increase or 
     imposition that was provided for such an article under this 
     subsection, then the entry of any such article for which 
     liquidation was suspended under paragraph (3) shall be 
     liquidated at whichever of such rates of duty is lower.
       (D) Rate of duty if provisional relief.--If provisional 
     relief is provided under this subsection with respect to an 
     imported article and neither a duty increase nor a duty 
     imposition is provided under subsection (b) for such article, 
     the entry of any such article for which liquidation was 
     suspended under paragraph (3) shall be liquidated at the rate 
     of duty that applied before the provisional relief was 
     provided.

     SEC. 323. PERIOD OF RELIEF.

       (a) In General.--Subject to subsection (b), the import 
     relief that the President provides under subsections (b) and 
     (c) of section 322 may not, in the aggregate, be in effect 
     for more than 2 years.
       (b) Extension.--
       (1) In general.--Subject to paragraph (2), the President 
     may extend the effective period of any import relief provided 
     under this subtitle for a period of not more than 2 years, if 
     the President determines that--
       (A) the import relief continues to be necessary to remedy 
     or prevent serious damage and to facilitate adjustment by the 
     domestic industry to import competition; and
       (B) there is evidence that the industry is making a 
     positive adjustment to import competition.
       (2) Limitation.--Any relief provided under this subtitle, 
     including any extensions thereof, may not, in the aggregate, 
     be in effect for more than 4 years.

     SEC. 324. ARTICLES EXEMPT FROM RELIEF.

        The President may not provide import relief under this 
     subtitle with respect to any article if--
       (1) import relief previously has been provided under this 
     subtitle with respect to that article; or
       (2) the article is subject to import relief under--
       (A) subtitle A; or
       (B) chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.).

     SEC. 325. RATE AFTER TERMINATION OF IMPORT RELIEF.

        When import relief under this subtitle is terminated with 
     respect to an article, the rate of duty on that article shall 
     be the rate that would have been in effect, but for the 
     provision of such relief, on the date the relief terminates.

     SEC. 326. TERMINATION OF RELIEF AUTHORITY.

        No import relief may be provided under this subtitle with 
     respect to any article after the date that is 10 years after 
     the date on which duties on the article are eliminated 
     pursuant to the Agreement.

     SEC. 327. COMPENSATION AUTHORITY.

        For purposes of section 123 of the Trade Act of 1974 (19 
     U.S.C. 2133), any import relief provided by the President 
     under this subtitle shall be treated as action taken under 
     chapter 1 of title II of such Act.

     SEC. 328. BUSINESS CONFIDENTIAL INFORMATION.

       The President may not release information which is 
     submitted in a proceeding under this subtitle and which the 
     President considers to be confidential business information 
     unless the party submitting the confidential business 
     information had notice, at the time of submission, that such 
     information would be released, or such party subsequently 
     consents to the release of the information. To the extent a 
     party submits confidential business information to the 
     President in a proceeding under this subtitle, the party also 
     shall submit a nonconfidential version of the information, in 
     which the confidential business information is summarized or, 
     if necessary, deleted.

       Subtitle C--Cases Under Title II of the Trade Act of 1974

     SEC. 331. FINDINGS AND ACTION ON GOODS FROM AUSTRALIA.

       (a) Effect of Imports.--If, in any investigation initiated 
     under chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.), the Commission makes an affirmative 
     determination (or a determination which the President may 
     treat as an affirmative determination under such chapter by 
     reason of section 330(d) of the Tariff Act of 1930), the 
     Commission shall also find (and report to the President at 
     the time such injury determination is submitted to the 
     President) whether imports of the article from Australia are 
     a substantial cause of serious injury or threat thereof.
       (b) Presidential Determination Regarding Australian 
     Imports.--In determining the nature and extent of action to 
     be taken under chapter 1 of title II of the Trade Act of 
     1974, the President shall determine whether imports from 
     Australia are a substantial cause of the serious injury or 
     threat thereof found by the Commission and, if such 
     determination is in the negative, may exclude from such 
     action imports from Australia.

                         TITLE IV--PROCUREMENT

     SEC. 401. ELIGIBLE PRODUCTS.

        Section 308(4)(A) of the Trade Agreements Act of 1979 (19 
     U.S.C. 2518(4)(A)) is amended--
       (1) by striking ``or'' at the end of clause (i);
       (2) by striking the period at the end of clause (ii) and 
     inserting ``; or''; and
       (3) by adding at the end the following new clause:
       ``(iii) a party to a free trade agreement that entered into 
     force with respect to the United States after December 31, 
     2003, and before January 2, 2005, a product or service of 
     that country or instrumentality which is covered under the 
     free trade agreement for procurement by the United States.''.

  The SPEAKER pro tempore (Mr. Hastings of Washington). Pursuant to the 
rule, the gentleman from California (Mr. Thomas) and the gentleman from 
New York (Mr. Rangel) each will control 1 hour.
  The Chair recognizes the gentleman from California (Mr. Thomas).
  (Mr. THOMAS asked and was given permission to revise and extend his 
remarks.)
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise today in strong support of H.R. 4759, which is 
the instrument that implements the United States-Australian Free Trade 
Agreement.
  This particular Free Trade Agreement is good, it is solid, it will 
benefit American workers, farmers, consumers, businesses, and the U.S. 
economy. It brings the United States and Australia closer together 
economically. No two countries in the world are closer in terms of 
their views of the world, especially in terms of strategic military 
concerns; and, frankly, as chairman of the Committee on Ways and Means, 
this agreement, in my opinion, is long overdue.
  Mr. Speaker, I yield the remainder of my time to the gentleman from 
Illinois (Mr. Crane), the chairman of the Subcommittee on Trade; and I 
ask unanimous consent that the gentleman from Illinois control the 
remainder of my time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. CRANE. Mr. Speaker, I reserve the balance of my time.
  The SPEAKER pro tempore. Without objection, the gentleman from 
California (Mr. Stark) will control the minority time.
  There was no objection.
  Mr. STARK. Mr. Speaker, I yield 30 minutes of my time to the 
gentleman from New York (Mr. Crowley), and I ask unanimous consent that 
he be allowed to yield such time as he sees fit.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
  I am in opposition to H.R. 4759, Mr. Speaker. It deals with issues of 
credibility, and it deals primarily with issues of pharmaceutical drugs 
and the possibility of reimportation, an issue dear to the hearts of 
many of the seniors in this country who are paying outrageous prices 
and are not being helped by the recent Republican pharmaceutical 
benefit.
  We have been repeatedly either lied to or have had information 
withheld. I know many of my colleagues are aware that the actuaries in 
CMS knew that the drug bill was going to cost closer to $500 billion, 
or $550 billion rather than the $400 billion which was promised. That 
information was withheld.
  For those of my colleagues who read The New York Times this morning,

[[Page H5699]]

they are aware of further withholding of information on the part of the 
Republicans. I guess it is not a lie, but I only bring it up at this 
point to indicate that I do not think we can trust any statements as to 
what the trade negotiator or trade representative may or may not be 
negotiating with Australia and what their intention is in the future.
  We were told by OMB in the pharmaceutical drug bill that 2.4 million 
employees would lose their retiree prescription benefits when we voted 
for this last pharmaceutical bill under Medicare. Well, guess what? 
Just earlier this week, we received from the CMS, another branch of the 
administration, a memo showing that 3.8 million workers will lose their 
drug benefits as a result of the Republican drug bill. A mere mistake 
of 1.4 million Americans who are going to lose drug benefits after we 
were opportuned to pass that bill with the idea that only 2.4 million 
would lose coverage.
  Now my colleagues may or may not care about another almost 1.5 
million workers being denied their retirement drug benefits, I know the 
Democrats do, but I raise these two issues, a difference of almost $200 
billion low-balling us on the cost of a drug bill and then 
subsequently, just today, finding out that 1.5 million more workers are 
going to lose their benefits. Now how can we depend on the 
administration to tell us anything straight that is in this trade bill?
  I get now to my point. We are concerned that intellectual property 
language allows pharmaceutical manufacturers to contractually prohibit 
reimportation of prescription drugs from Australia. We know that. Once 
we approve this language, any attempt to pass reimportation language 
will immediately run afoul of the Australian Free Trade Agreement. This 
is not just about the U.S. and Australia. This is a bill that was 
engineered by the pharmacy lobby.
  Let me point out, when the trade representatives met, they have a 
board, there were 15 members of the pharmaceutical industry sitting 
down to advise the trade representative and not one representative of 
the consumer community. What does that tell us? It tells us that 
certainly the trade representative representing the administration can 
undermine the will of the people in this country and the majority of 
Congress through trade negotiation power over which we are powerless to 
change after we vote today.
  The last time that I checked, reimportation of pharmaceutical drugs 
was a domestic health policy issue that should be debated in Congress, 
and we should be making domestic health policy in this Chamber, not the 
U.S. Trade Representative.
  Now, the trade representative is promising to use this language over 
and over again in future free trade agreements, and eventually it is 
going to come back to haunt us.
  Now I have no doubt that the trade representative knows how to 
negotiate free trade, but I have a real question if he has any interest 
in protecting the health care of American citizens. Not only have we 
given PhRMA the keys to the kingdom, we are now letting them pillage 
their way through our health care programs.
  In a brief moment of honesty, the U.S. Trade Representative admitted 
that transparency requirements in annex 2(c) of the Fair Trade 
Agreement actually do apply to a Medicare Part B drug reimbursement 
decision. In its current form, the proposed change to an average sales 
price reimbursement system does not meet the transparency requirements 
of the FTA, it opens the door to challenges, and it frustrates the 
ability of this body to pass reasonable, safe reimportation that will 
lower the cost of drugs for our senior citizens by, in many cases, 50 
percent, far more than the mere 5 or 10 percent that this cockamamie 
Buck Rogers discount card that the administration has brought out.
  So we are here with a subtle underlying problem, and that is the 
health care of 42 million seniors in this country, and now it turns out 
almost 4 million more employed Medicare beneficiaries or people who are 
receiving their benefits as retirees, and we cannot sell them down the 
river, Mr. Speaker. That is not the right thing to do.
  We could argue the trade bill all day long, take some of these things 
out, and it is probably all right, but it is engineered not to be 
amended. We were not allowed to amend it in markup in committee, we 
cannot amend it here on the floor, it is up or down. So our only choice 
is to vote it down, send it back to the committee, do it right, and 
then proceed.
  So I urge a no vote.
  Mr. Speaker, at this point I yield the balance of my time to the 
gentleman from Ohio (Mr. Brown) and ask unanimous consent that he be 
allowed to yield that time as he sees fit.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  I want to remind my colleague that we can get into the debate on 
reimportation of drugs at some time when it is relevant, because it has 
no application to this agreement.
  I am pleased that the House today will pass the long-overdue U.S.-
Australia Free Trade Agreement. I applaud the efforts of President Bush 
and the USTR in negotiating an agreement that opens markets for U.S. 
exports by eliminating tariffs, reducing nontariff barriers, opening 
services markets, and strengthening intellectual property protections.
  This is an important agreement. The U.S. enjoys a $9 billion trade 
surplus with Australia, and Australia is our ninth largest goods export 
market. Australian firms in the U.S. employ about 85,000 Americans, and 
it is estimated that U.S. exports to Australia support more than 
150,000 U.S. jobs. Under the terms of this agreement, over 99 percent 
of U.S. exports of industrial goods to Australia will become duty-free 
immediately. U.S. manufacturers estimate that the elimination of 
tariffs could result in nearly $2 billion per year in increased U.S. 
exports of manufactured goods.
  This agreement also gives our farmers new opportunities. All U.S. 
agricultural exports to Australia totaling more than $400 million will 
receive immediate duty-free access. Key agricultural products that will 
benefit from immediate tariff elimination include soybeans and oilseed 
products, fresh and processed fruits, vegetables and nuts, and pork 
products. Our dairy farmers also will have immediate access to the 
Australian market.
  Mr. Speaker, this agreement is also very important to my State of 
Illinois, which is home to companies including Caterpillar, Boeing, 
Motorola, Abbott Labs, and Zurich Life. Illinois exports to Australia 
directly support approximately 4,400 jobs in the State of Illinois. 
Additionally, there are 20 Australian-owned companies in Illinois, 
employing over 2,000 people. Nine hundred of these positions are 
manufacturing jobs. Trade with Australia supports numerous other high-
paying jobs in areas such as transportation, finance, and advertising; 
and between 1999 and 2003, Illinois exports to Australia grew by 12 
percent. This Free Trade Agreement means more jobs, better jobs, and 
higher-paying jobs in Illinois and America.
  As chairman of the Subcommittee on Trade, it has been my privilege to 
have been involved in the completion of this trade agreement, and I 
thank my colleagues who worked so hard to make this a reality.
  I would also like to express appreciation to staff, including, to 
name just a few, Angela Ellard, Stephanie Lester, Matt Howard, Tim 
Reif, Viji Rangaswami, Mike Castellano, Brian Gaston, Sam Geduldig, 
Brian Diffell, Andrew Shore, John DeStefano, Amy Heerink, Rachael 
Leman, Janet Nuzum, James Koski, Greg Sheiowitz, Chris McConnell, and 
Vergil Cabasco. I thank them.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CROWLEY. Mr. Speaker, I yield 3 minutes to the gentleman from 
Maryland (Mr. Cardin).

                              {time}  1445

  Mr. CARDIN. Mr. Speaker, let me thank my friend from New York for 
yielding me this time.
  I rise in support of this free trade agreement and urge my colleagues 
to support it. This is a bilateral free trade agreement between the 
United States and Australia. I think that we stand to make more 
progress when we work on

[[Page H5700]]

bilateral agreements rather than multinational agreements, particularly 
when we are dealing with a country that is very similar to the United 
States.
  The United States and Australia have much in common. Both nations 
respect basic labor rights and the enforcement of basic workers' 
rights. This agreement strengthens the enforcement of those laws. Both 
nations respect the environment, and the agreement calls for both 
parties to commit to establish high levels of environmental protection 
and not to weaken or reduce environmental laws to attract trade or 
investment.
  Australia is a close ally of the United States in many of our 
international activities. The United States enjoys a trade surplus with 
Australia of $9 billion per year. It is our ninth largest export 
market.
  Mr. Speaker, Australia is a good friend, and it is in our interest to 
establish a free trade agreement with Australia.
  It will open up more markets to U.S. manufacturers and farmers. 
Australia's tariffs for manufacturing will basically be eliminated on 
goods coming from the United States to Australia; 99 percent will enter 
Australia duty free.
  There is key relief on the exports of agricultural products to 
Australia. The United States estimates that more than 400 million per 
year will receive immediate duty-free access to Australia; and let me 
just point out as a footnote, there is no additional access to 
Australia in regards to sugar. This agreement will help U.S. 
manufacturers and farmers. The United States will enjoy tariff 
preferences over its European and North Asian competitors and products, 
such as chemicals and heavy machinery.
  In fact, the U.S. National Association of Manufacturers has estimated 
that the free trade agreement will result in a minimum of $2 billion 
per year increase in manufacturing exports to Australia. In regards to 
farming, the United States is already the second largest supplier of 
Australia's food imports. This bill will even give us greater access.
  Mr. Speaker, I think my district is somewhat typical in the Nation. I 
have a port. We have a large presence of manufacturing. We have a 
strong agricultural community. My State and the people of Maryland will 
benefit from this free trade agreement. The people of this Nation will 
benefit from this free trade agreement. I urge my colleagues to support 
it.
  Mr. BROWN of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  It has been a really good year for the drug industry. The 
pharmaceutical industry is at it again in this body, attempting to 
undermine U.S. efforts to secure cheaper prescription drugs for 
millions of Americans. First, the Medicare bill passed late last year 
specifically prohibited the U.S. Government from negotiating lower drug 
prices for America's seniors and consumers, the drug industry and the 
President and the Republican leadership all singing off the same page.
  Then the pharmaceutical industry punishes American consumers by 
restricting the volume of prescription drug inventories in Canada to 
prevent importation to the U.S., the FDA, the President, Republican 
leadership and the drug industry again all singing off the same page.
  Now the President, the United States Trade Rep together have included 
language in this U.S.-Australia trade agreement that would enable the 
drug companies to prevent prescription drug importation, again to the 
detriment of America's consumers. We can bet those provisions will be 
in all future trade agreements negotiated by this administration.
  USTR and its drug industry allies, sometimes they are hard to tell 
apart, are doing all they can to drive up prices for Americans and the 
rest of the world. USTR and the drug industry were the only parties 
with a seat at the table for these FTA negotiations, no public interest 
groups, no senior groups, nobody advocating for reimportation.
  My question is this: Do we trust the USTR and the President and the 
drug industry to negotiate lower drug prices? Connect the dots. The 
drug makers are using every tool at their disposal to put a 
stranglehold on America's seniors and America's consumers. The 
reimportation bill this House passed last year included Australia as a 
platform. The reimportation bill in the Senate includes Australia as a 
platform. Why would both these bills mention Australia if we were not 
going to at least attempt to reimport from there?
  This FTA shuts the door on all possibilities now and in the future. 
Why would we do that, Mr. Speaker? The only way to maintain compliance 
if we pass this FTA is to remove Australia from that bill. Although 
Australia would likely not be a large reimportation platform, it is not 
currently impossible. This FTA slams the door on that possibility. It 
slams the door on any future agreement between Australia and us on the 
issue.
  Now, I want to read for a moment a brief part of a fact sheet from 
the Australian embassy: ``Australian law does allow the export of 
nonsubsidized drugs, both generics and brand names,'' in spite of what 
we heard from my friend here, ``but only by a person who has been given 
marketing approval to do so, usually the manufacturer or Australian 
licensee.''
  From the Australia embassy: ``Australian law does allow the export of 
nonsubsidized drugs.'' The drug industry argues the trade agreement is 
not damaging, because Australian law already prohibits the export of 
subsidized drugs purchased under its pharmaceutical benefit scheme. 
However, that prohibition does not include all cost-saving importation 
from Australia.
  The importers of drugs from Australia to the U.S. do not have to 
purchase from the PBS. The provisions of this free trade agreement set 
a precedent for another misguided trade policy. We can be sure that 
this provision, this precedent that Members are going to vote on today, 
this precedent will be in all future FTAs negotiated by this 
administration. That is why a ``no'' vote is so very important so we do 
not set this precedent in this encouragement for the administration to 
continue to negotiate bad trade law, especially bad trade law for 
American consumers.
  The drug makers are making sure they close off any opportunity for 
American consumers to obtain affordable prescription drugs. This, Mr. 
Speaker, is another nail in that coffin. If one supports reimportation 
of affordable prescription drugs, think twice about the precedent your 
vote sets here today. A vote for the U.S. free trade agreement with 
Australia is a move against American consumers and a move against 
reimportation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  I would like to remind everyone of a Dear Colleague that was released 
yesterday by our ranking minority member on the Committee on Ways and 
Means Subcommittee on Trade, the gentleman from Michigan (Mr. Levin), 
and our ranking member on the full Committee on Ways and Means, the 
gentleman from New York (Mr. Rangel); and this is in their Dear 
Colleague letter: ``The Australia Free Trade Agreement is worthy of 
support. Article 17.9.4 of the Australia FTA essentially codifies 
existing U.S. law in an international trade agreement. Current U.S. law 
allows patent holders to bar the import of their patented products. The 
patent provision will not have a practical effect due to the fact that 
Australia's domestic law prohibits the export of drugs purchased 
through its government-subsidized program which accounts for over 90 
percent of all drugs sold in Australia.
  ``Article 17.9.4 matters only to the extent that the United States is 
allowing the import of prescription drugs from Australia, or which are 
covered by a patent owned by an Australian firm. As a practical matter, 
with or without the Australia FTA, there is little possibility of 
importing prescription drugs from Australia.''
  Mr. Speaker, I yield 3 minutes to the gentlewoman from Washington 
(Ms. Dunn), cochair of the U.S.-Australia Caucus and a member of our 
Committee on Ways and Means.
  Ms. DUNN. Mr. Speaker, I rise in support of this historic free trade 
agreement with Australia. Australia has been a true friend and ally. 
They have been there when it counted the most, on the shores of 
Normandy, on the

[[Page H5701]]

streets of Baghdad when the odds seemed insurmountable and the light of 
victory was far, far away.
  Over 50 years ago, we began an alliance with Australia based on 
mutual security needs. Today we build on our security alliance in the 
past with an economic alliance for the future. Bismarck once said that 
``politics is the art of the possible.'' While that is certainly true 
and an accurate description of the negotiations of this agreement, this 
trade agreement is also about a world of possibilities. There is a 
common thread that binds the fabric of both nations' past to the 
future. We are both nations that are built on possibilities. Whether 
our citizens arrived an Plymouth Rock in Massachusetts or the rocks in 
Sydney, many came for the possibility of new beginnings and the 
possibility of determining their own destiny; and just like those 
before us, this generation of Americans and Australians will paint the 
canvas of this trade agreement with their entrepreneurial spirit.
  In doing so, we are reminded that the strengths of our nations are 
not in our governments, but in the thousands of our citizens who are 
turning possibilities into reality; and it is time for this Congress to 
make this trade agreement a reality.
  This is a trade agreement that creates jobs. Two-way trade in goods 
and services between both countries is already $29 billion each year, 
supporting more than 270,000 American jobs, 12,500 of which are in my 
State of Washington alone.
  While all States will benefit from this agreement, the Puget Sound 
region will have even more to gain, because Australia already is our 
fifth largest trading partner, and the State of Washington leads the 
Nation with more than $2.6 billion worth of exports to Australia each 
year. It is a trade agreement that will help businesses and farmers in 
the Northwest.
  For the 25,000 Boeing workers that I represent, this agreement will 
ensure that Boeing remains competitive in Australia. Currently, nearly 
95 percent of Qantas Airways' operating fleet is Boeing aircraft, 
making them one of Boeing's key customers in that region.
  For our high-tech industry, strengthening intellectual property 
standards will help reduce counterfeiting and piracy, while encouraging 
capital investments.
  For our farmers, eliminating agricultural tariffs and resolving 
technical and regulatory barriers will ensure that Northwest fruits 
will enter the Australian market.
  Mr. Speaker, vote for this trade agreement, not out of a sense of 
obligation but because of a steadfast confidence that Americans and 
Australians can better face the challenges ahead by walking side by 
side.
  Mr. CROWLEY. Mr. Speaker, I yield myself 3\1/2\ minutes.
  Mr. Speaker, I rise today in strong support of the free trade 
agreement between the United States and Australia, and I would like to 
thank all my colleagues on both sides of the aisle who have worked so 
hard to see that this bill passes with bipartisan support today.
  It has been a pleasure for me to work with the gentleman from 
Missouri (Mr. Blunt), the majority whip; and my counterparts on the 
other side of the aisle, the gentleman from Virginia (Mr. Cantor), 
chief deputy whip; the gentleman from Alabama (Mr. Rogers); the dean of 
my home State, the gentleman from New York (Mr. Rangel); the gentleman 
from Michigan (Mr. Levin); the gentleman from California (Mr. Dooley); 
and the gentleman from Oregon (Mr. Blumenauer). I am proud to speak out 
in support of this historic bilateral free trade agreement between the 
United States and Australia.
  This is a great day for our two countries and for what is arguably 
one of our truest and tried allies. From World War I to the war on 
terror in Afghanistan and in Iraq, Australia has stood shoulder to 
shoulder with the United States and has been a strong ally of ours 
throughout the world.
  As someone who supports free trade and fair trade, I am proud to be a 
leader on the Democratic side supporting this free trade agreement. 
Concerns have been raised, though, about the issue of pharmaceuticals 
this week, in fact, as of Monday. And I would like to make note of 
that. I support the reimportation of prescription drugs and have 
concerns about this trade agreement becoming a precedent for other 
bilateral agreements; but I want to be clear that nothing, I believe, 
in this agreement will prohibit the United States from passing its own 
reimportation laws. And this agreement does not ban the United States 
from reimportation of prescription drugs.
  Australia's domestic law prohibits the exportation of drugs purchased 
through its taxpayer-subsidized program, which accounts for over 90 
percent of all drugs sold in Australia. Why would we ask the Australian 
taxpayer to subsidize Rx drugs for Americans?

                              {time}  1500

  The issue of lowering drug prices is something that this Congress 
should be working on. In fact, today my colleagues on both sides of the 
aisle have the opportunity to do that by signing the discharge petition 
to give the authority to Secretary Thompson, the ability to negotiate 
lower drug costs for Medicare patients that were stripped away under 
H.R. 1.
  This agreement will not stop the Snowe-Doggett legislation from 
progressing in the Senate, and it does not stop the U.S. from changing 
the law and allowing for drug reimportation. I would like to reaffirm 
that I do not believe that this agreement should be used as a precedent 
for other trade agreements that USTR makes in the future on 
reimportation. We need to focus on the positive aspects of this 
agreement.
  This agreement will also benefit my home State of New York and New 
York City. New York will see immediate benefits from this agreement as 
it goes into effect. New York last year exported goods valued at over 
$392 million to Australia, and when this agreement goes into effect, 
those companies will see an average saving of over 5 percent. Australia 
is the fifth largest investor in the U.S. equity markets, meaning more 
jobs for my constituency and the companies that do business in my city 
who trade securities or work for these firms.
  This agreement will keep our economy growing and will be a 
partnership of equals and will increase the investments and 
opportunities for both countries. I support this agreement, and I urge 
my colleagues to vote for final passage.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the Australia FTA does not prevent Congress from passing 
legislation on drug reimportation. Under the U.S. Constitution, no 
trade agreement could do this. Any law passed by Congress will always 
trump any FTA. There is nothing in the Australia FTA or H.R. 4759 that 
changes U.S. patent laws or the Federal Food, Drug and Cosmetic Act. 
The patent provision in the FTA restates U.S. law and applies to all 
patents, not just pharmaceuticals. Not including this provision would 
be devastating to U.S. intellectual property rights holders in every 
sector.
  Australian law already bans the exportation of drugs dispensed under 
its pharmaceutical benefits scheme. Unlike Canada, Australian law 
expressly prohibits other parties such as a wholesaler or pharmacist 
from exporting non-PBS dispensed drugs. Therefore, any change in U.S. 
law would have no practical effect on reimportation to Australia due to 
Australia domestic law, regardless of the FTA; and, therefore, 
Australia would have no plausible basis to claim harm or pursue 
sanctions.
  Mr. Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. 
Portman), one of our colleagues on the Committee on Ways and Means.
  Mr. PORTMAN. Mr. Speaker, I thank the gentleman for yielding me time, 
and I appreciate his clarification and also the clarification of the 
gentleman from New York (Mr. Crowley) as this legislation before us 
relates to the issue of importation of prescription drugs.
  I do rise in very strong support of the U.S.-Australian Free Trade 
Agreement. As the gentleman from New York (Mr. Crowley) has said, we 
have a long-standing friendship with Australia. We also have a lot of 
economic interest and move forward with this particular legislation. 
Knocking down barriers always leads to a fairer and a more healthy 
relationship between countries

[[Page H5702]]

and for better economics between both countries.
  In this case, this bipartisan agreement will give a boost to our 
large and growing investment links with Australia and will help 
strengthen the U.S. economy. President Bush and Ambassador Bob Zoellick 
deserve a lot of credit for moving forward strongly with this 
particular agreement and for their continued determination on bilateral 
agreements in general.
  This agreement will help small business and manufacturers quite a bit 
in my home State of Ohio. Australia is now number 11 in terms of 
countries to which we export. Total exports are now valued at $389 
million. Ohio primarily exports high-value products to Australia, 
aircraft engines and parts, auto parts, forklift trucks, pet food, 
household appliances. If the Free Trade Agreement was in effect last 
year, we would have seen over 93 percent of those exports, including 
again some of these manufactured high-quality, high-value exports, 93 
percent of them would have entered Australia duty free.
  Ohio's exports to Australia directly support about 1,800 good-paying 
jobs in Ohio. And, by the way, there are 17 Australian-owned companies 
in Ohio, which also employ roughly 1,800 people. 1,300 of those 
positions, by the way, are in manufacturing.
  Trade with Australia supports countless other high-paying jobs in 
areas such as transportation, finance and advertising. This agreement 
is good for Ohio. It is good for jobs. It is good for relations with 
one of our great friends, Australia. Opening markets across the globe 
to Ohio businesses is the key to keeping our Buckeye economy strong.
  The U.S.-Australia Free Trade Agreement is also important because 
Australia and the U.S. share a lot of similar goals in terms of 
international trade. We are both supporters of achieving trade 
liberalization in the current round of trade talks. We are both 
pursuing market access through regional and bilateral trade agreements. 
Another reason to support this agreement.
  With overwhelming support today, we will be helping to fulfill 
President Bush's vision of a world that trades in freedom.
  Mr. BROWN of Ohio. Mr. Speaker, I have been here 12 years and heard 
these same arguments. I look at my State, and we have lost one out of 
six manufacturing jobs, 190 jobs every day during the Bush 
administration, and I do not see how it adds up.
  Mr. Speaker, I yield 3 minutes to the gentleman from Vermont (Mr. 
Sanders).
  Mr. SANDERS. Mr. Speaker, I thank my good friend, the gentleman from 
Ohio (Mr. Brown), for yielding me time.
  I rise in strong opposition to this agreement. It seems to me that 
before we rush into yet another free trade agreement we should spend a 
little bit of time assessing the horrendous impact that past free trade 
agreements have had on the middle class and working families of this 
country. If you have a policy which is failing, failing and failing, 
why do you want to continue going along that path?
  Mr. Speaker, for many years now, corporate America and the big money 
interests have told us how good unfettered free trade would be if they 
spent a fortune getting these agreements passed. What they forgot to 
tell us is that while these free trade agreements are in fact good for 
the big corporations and their well-paid CEOs, they have been a 
disaster for the middle class and working families of our country.
  The reality is, despite tremendous increases in technology and 
productivity, the average American today is working longer hours for 
lower wages. The gap between the rich and the poor is getting wider, 
and poverty is increasing. The middle class in America is collapsing, 
and unfettered free trade is one of the reasons.
  In the last 3 years alone, we have lost 2.7 million good 
manufacturing jobs, over 16 percent of the total, and now after the 
collapse of manufacturing we are beginning to see the hemorrhaging of 
good-paying information technology jobs. While large corporations throw 
American workers out on the streets and move to China, India, Mexico 
and other low-wage countries, the new jobs being created here for our 
people are mostly low wage with minimal benefits. In fact, according to 
the Bureau of Labor Statistics, 7 out of 10 of the fastest-growing 
professions in the next 10 years are going to be with high school 
degrees, minimal benefits, lower wages.
  Is that the future that we want for our country?
  To add insult to injury, Mr. Chairman, the President of the U.S. 
Chamber of Commerce, Tom Donohue, the leader of our country's big 
business organization, has urged, has urged American companies to send 
our jobs overseas. Urged them. That is the kind of contempt that 
corporate America has for the working families of this country. By 
continuing to pass unfettered free trade agreements, we accommodate Mr. 
Donohue's goal; and we will see the loss of more and more good-paying 
jobs in this country.
  I understand that Australia is not China, and I understand that 
workers there earn comparable wages, and I understand they do not go to 
jail when they stand up for their rights, and we could perhaps 
negotiate good agreements here and there with Australia, but an 
unfettered free trade agreement is not good.
  Let me conclude by mentioning two specific objections I have.
  Number one, the gentleman from Ohio (Mr. Brown) is right about 
reimportation and prescription drugs. I worry very much about the 
precedent, if we want to lower prescription drug costs in this country 
by this agreement.
  Second of all, dairy farmers in Vermont, New England and America will 
be significantly and negatively impacted by the importation of a lot of 
dairy products over the years from Australia.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume. 
The State of Vermont exported $12.8 million of merchandise to Australia 
in 2003. Vermont's high-value exports to Australia include food for 
infants, aircraft and sports equipment; and if the FTA was in place in 
2003, 99.8 percent of Vermont's exports would have entered Australia 
duty free.
  American exports to Australia directly and indirectly support over 
270,000 jobs in the United States.
  Mr. Speaker, I yield 1 minute to the distinguished gentleman from 
Texas (Mr. Brady).
  Mr. BRADY of Texas. Mr. Speaker, listening to my colleague from 
Vermont, we have been neglected to be told that free trade is also 
responsible for obesity, male pattern baldness and the breakup of the 
Beatles.
  The fact of the matter is that America needs new customers for our 
farm products, for things we are manufacturing. The principle involved 
here is, the principle is that if America builds a better product, we 
ought to be able to sell it without discrimination throughout the 
world. If someone else builds a better product, a better mousetrap, we 
ought to be able to buy it for our families and for our business.
  America needs more customers like Australia. In Texas, this trade 
agreement means some 12,000 jobs for our State. It is good for our 
farmers. It is good for our manufacturers. On the day it goes into 
place, 99 percent of Australian penalties on products built in Texas 
and the U.S. will disappear. That is good for our workers. It is good 
for our farmers. It is great for our consumers.
  This is a trade agreement that is excellent for U.S. manufacturers 
and the workers who work for them.
  Mr. CROWLEY. Mr. Speaker, I ask unanimous consent for the gentleman 
from Michigan (Mr. Levin) to control the remainder of my time for 
purposes of yielding.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  Mr. CROWLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Virginia (Mr. Moran).
  Mr. MORAN OF Virginia. Mr. Speaker, I hesitate to use the term ``slam 
dunk'' any more, but if you cannot agree with this trade agreement, I 
do not know what trade agreement you are ever going to agree with. In 
fact, you would probably have to oppose agreements between the States 
of the United States.
  The fact is, of the $28 billion of trade with Australia, we enjoy a 
surplus of $9 billion. That means Australia is buying $9 billion more 
of goods and services from us than we are buying from them.

[[Page H5703]]

  The fact is that this is generating jobs in the United States. Trade 
can do that and trade will do that. The fact is that there is $700 
million of agricultural products that we are selling to Australia, and 
they are now going to be able to be purchased more cheaply because 
there will be duty free access. We have National Treatment for our U.S. 
investors, guaranteeing fair and non-discriminatory treatment. Who 
could be opposed to that?
  We have guaranteed, substantial access for U.S. service suppliers, 
telecom, financial services, professional service providers. Australia 
has agreed to improve its intellectual property laws so we do not have 
to worry about that. We are going to have the highest level of 
protection throughout the world for U.S. products in that area. Even 
more importantly to my Democratic colleagues, Australia has the highest 
level of labor and environmental standards. They are tougher than ours. 
So it just seems to me that under this agreement we have so much to 
gain and very little to lose.
  And, again, with regard to this issue that has been brought up with 
regard to pharmaceutical products, Australia will not allow the export 
of subsidized pharmaceutical products; and 90 percent of its 
pharmaceuticals that are prescribed are, in fact, subsidized.
  So, again, let us support this agreement. Do the right thing by 
America's workers and its employers.
  Mr. CRANE. Mr. Speaker, I yield 2\1/2\ minutes to the distinguished 
gentleman from Pennsylvania (Mr. English).

                              {time}  1515

  Mr. ENGLISH. Mr. Speaker, today, the House is considering, I think, 
landmark trade legislation by considering a free trade agreement with 
our close ally and trading partner, Australia.
  As a member of the Subcommittee on Trade, I have had the opportunity 
to review many trade agreements and specific concerns with our trading 
partners, and I am happy to conclude that the U.S.-Australia FTA is 
among the most pro-American, pro-worker agreements that we have seen 
before this House.
  For 50 years, we have cooperated closely on security issues and 
developed a trading relationship to the tune of $29 billion. What is 
more, the United States enjoys a $9 billion trade surplus with 
Australia. Indeed, Australia purchases more goods from the United 
States than it does from any other country, and that is extraordinary.
  While our positive relationship is an important factor in approving 
this FTA, to me, Mr. Speaker, this agreement really stands on its own 
merits on what it will do for manufacturers in my congressional 
district.
  Australian companies currently employ 1,600 people in Pennsylvania of 
whom 600 are in the manufacturing sector. This agreement would increase 
investment opportunities in Pennsylvania and create jobs.
  Australia is the eighth largest market for Pennsylvania goods 
exports, with total exports valued at $430 million last year.
  Pennsylvania's economy is heavily dependent on manufacturing; and 21 
percent, or $89 million, of our total exports to Australia was in 
manufactured machinery in 2003. Our exports to Australia support, we 
estimate, 2,000 jobs in Pennsylvania alone.
  This agreement would lower the tariffs on American manufactured 
products and create even more opportunities for local manufacturers to 
tap into a robust Australian market.
  By immediately making almost 99 percent of U.S. manufactured exports 
to Australia duty free, American exports would shoot up by an estimated 
$2 billion annually. Since 93 percent of our goods exported to 
Australia are in industrial products, the significant benefit this 
agreement offers U.S. manufacturers is obvious.
  Mr. Speaker, it is clear that our relationship with Australia is one 
of our most important. By approving this FTA, we can deepen this 
relationship, and we can also enter into an FTA which will particularly 
benefit our manufacturing sector; and that is what sets this treaty 
particularly apart from others that have come before this House.
  I urge my colleagues strongly, on a bipartisan basis, to embrace this 
FTA.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 2\1/2\ minutes to the 
gentleman from Oregon (Mr. DeFazio).
  Mr. DeFAZIO. Mr. Speaker, Australia is exactly the type of nation we 
should seek trade agreements with, but not with a Xerox of our old and 
failed policies under fast track, with no amendments allowed here on 
the floor of the House.
  There is only one new provision, strangely enough, one to prohibit 
the reimportation of less expensive prescription drugs. Where did that 
come from, I wonder? It must be American policy. No, I think it is 
pharmaceutical industry policy.
  Now, we talk about Australia. We have a trade surplus. Why do we need 
this agreement? We had a trade surplus with Mexico. They talked about 
that how it was going to get bigger. Guess what, now we have a deficit. 
If we have a policy that is dramatically failing the Nation, our 
workers, our consumers, what do we do? In this Congress and with this 
administration, we do more of the same, $525 billion trade deficit, $1 
million a minute of American wealth and jobs flowing overseas, mostly 
to unfair competition.
  This agreement does not have enforceable labor standards. In fact, if 
we can have enforceable trademark and property standards, why can we 
not have an enforceable labor standard? And if we have not got one with 
Australia, who are we ever going to get one with?
  It does not have enforceable environmental standards. If we cannot 
get enforceable environmental and consumer protection standards with 
Australia, who are we going to ever get one with? China? I do not think 
so.
  Then why are pharmaceuticals in this agreement? Because this 
administration and their special trade representatives say this is a 
template for all future agreements, and they want to renegotiate our 
agreement with Canada to prohibit the reimportation of less expensive 
pharmaceuticals because it is undermining the obscene profits of the 
pharmaceutical industry. That is plain and simple.
  Dairy and cheese and wheat, I think those are all questionable 
provisions; and, again, it undermines the ability of State and local 
governments to have contracting provisions that give preference to 
businesses of their choice.
  Everything that is wrong with every other trade agreement that has 
led to the $525 billion trade deficit is wrong with the principles in 
this one. We are only lucky that it is a country that has a higher 
minimum wage, that has national health care, that has strong 
environmental laws, and that is not likely to change; but this will 
incorporate and further cement in these bad principles a new one that 
is absolutely atrocious, which protects the profits of the 
pharmaceutical industry against the health and welfare of the American 
people.
  Vote ``no'' on this, and let us get a new trade policy that works for 
all Americans, not just a select few multinational corporations and 
special interests.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Oregon is a trader with Australia right now, and Australia is the 
10th largest market for Oregon goods that are exported with total 
exports valued at over $257 million in 2003. Oregon's high-volume 
exports to Australia include chassis trucks, fertilizers, vehicle 
parts, and helicopters.
  Oregon exports to Australia directly support approximately 1,200 
jobs. Additionally, there are 12 Australian-owned companies in Oregon 
employing over 300 people. Trade with Australia supports numerous other 
high-paying jobs in areas such as transportation, finance, and 
advertising.
  Mr. Speaker, I yield 2 minutes to the distinguished gentleman from 
Michigan (Mr. Knollenberg).
  Mr. KNOLLENBERG. Mr. Speaker, I thank the gentleman for yielding me 
time, and I appreciate the 2 minutes.
  I obviously rise in strong support of the Australia free trade 
agreement. Let me add a few positives to what has already been said.
  We have some who disagree with us on the other side. They have split 
up the other side. Trade is absolutely critical to our economy. 
American businesses and workers are the best in world. When we open up 
markets for American products, our companies sell more overseas and 
create more jobs back here at home.

[[Page H5704]]

  This agreement is certainly clearly beneficial to the U.S. Two-way 
trade, as has been stated, between the U.S. and Australia is 
approximately $29 billion; and I will mention it again, the surplus of 
$9 billion. Every State in America exports. Every single State exports 
to Australia.
  My home State of Michigan, for example, ranks as number five, fifth 
highest, over $2 billion in export products in the last 3 years; but we 
can do a great deal more than that. Let me take a look at the American 
auto industry for a moment. This is a significant part of the economy 
in my district and many, many more around the country.
  It is no secret that global competition in the auto sector is 
intense. Auto companies around the world work hard to realize price 
advantages over their competitors. The U.S.-Australia Free Trade 
Agreement gives our auto companies a real leg up. As a result of this 
agreement, on January 1, 2005, American auto exports to Australia will 
cost 10 to 15 percent less than our Japanese, Korean, and European 
competitors.
  That means more work building cars for export to Australia for the 
600,000 Americans employed by auto companies and the 2 million 
Americans who work for auto suppliers, as well as the many industries 
that support those companies. These are real benefits that we will 
bring to those American workers and many others by passing this 
agreement today.
  Free trade agreements, like the one before us today, are good for our 
country, with our good friend Australia in particular. They mean more 
jobs at better wages. They mean long-term health for our economy.
  So let us make it a reality. Vote ``yes'' on the U.S.-Australia Free 
Trade Agreement.
  Mr. LEVIN. Mr. Speaker, it is my pleasure to yield 2 minutes to the 
gentlewoman from Guam (Mr. Bordallo), a very capable Congresswoman.
  Ms. BORDALLO. Mr. Speaker, I thank my colleague from Michigan for the 
time.
  Mr. Speaker, I rise in strong support of the U.S.-Australia Free 
Trade Agreement. The agreement before us deals with some very big 
numbers. It supports over 270,000 jobs here at home and the $18 billion 
in exports to Australia these workers generate annually.
  Australian exports to Guam are approximately $12 million per year, 
consisting mainly of consumer goods and building materials. The Guam 
shipyard is capable of repairing Australian vessels, and the twice 
weekly direct flights between Cairns and Guam bring a steady stream of 
tourists in both directions.
  Under the agreement, 99 percent of Guam's exports will enter 
Australia duty free. Even greater than the numerical case for 
supporting this free trade agreement are the shared values that 
underpin trade between our two nations. Many of my colleagues have 
appropriately used trade agreements in the past to highlight the 
failure of our trading partners to address human rights, environmental 
quality control, and labor standards within their borders.
  Under these trade criteria, Australia is exactly the kind of country 
that we should trade with. Australia has an outstanding record on 
meeting its international human rights commitments. Australia is our 
partner in promoting these values in the Asia Pacific region.
  Australia's environmental standards give us the reassurance that our 
imports do not abuse global resources. Their laws protecting coral 
reefs and their strong enforcement of them serve as a model for 
protecting our own endangered ocean habitat.
  Australia's labor standards are so deeply ingrained in their society 
that they serve as a reminder to us that we owe our own workers a 
higher minimum wage. Under this agreement, we are not in a race to the 
bottom with Australia's workers; but rather, Mr. Speaker, we are 
sharing the best of what we make for our common advantage.
  Given our shared values with the people of Australia, it only makes 
sense that we pass this agreement today. I urge my colleagues to do so.
  Mr. CRANE. Mr. Speaker, I yield 3 minutes to the distinguished 
gentlewoman from Connecticut (Mrs. Johnson).
  Mrs. JOHNSON of Connecticut. Mr. Speaker, I thank the chairman for 
yielding me the time, and I congratulate Ambassador Zoellick and our 
President for getting a very good trade agreement with Australia, one 
that will benefit workers, consumers, and companies alike.
  We have had a long and mutually beneficial relationship with 
Australia. It has been a trusted, staunch ally in the Pacific and a 
progressive voice for expanding free trade around the globe.
  Mr. Speaker, this is a pioneering trade agreement. It is the most 
significant reduction in industrial tariffs ever achieved in a free 
trade agreement. This is, at its heart, a manufacturers' trade 
agreement.
  While Connecticut is a long way from Sydney, one would never know it 
based on the economic ties between my home State and Australia. Nearly 
$140 million worth of merchandise was exported from Connecticut to 
Australia in 2003. In 1999, the figure was $81 million. We have 
increased exports by $60 million without a trade agreement. Imagine 
what we will be able to do with this trade agreement, which reduces 
manufacturing tariffs from a full 5 percent. It literally wipes them 
out. That is equivalent to a 5 percent price reduction in product in 
the market.
  So if we have been able to grow our trade with Australia, that is, 
between Connecticut and Australia, without this agreement, think what a 
boon this will be for nearly 99 percent of Connecticut's exports that 
will enter Australia with this agreement duty free.
  I believe the Australian agreement is indicative of the bright future 
trade liberalization is creating. Australia is a democratic, well-
developed nation with amongst the highest labor and environmental 
standards in the world and with a very capable enforcement system. It 
simply does not make sense for either nation to preserve antiquated 
tariffs in light of our strong economic and political ties.

                              {time}  1530

  I strongly support this U.S.-Australian trade agreement and urge the 
House to pass it.
  Let me conclude, Mr. Speaker, by noting that 25 percent of our gross 
national product is the direct consequence of exports and trade, and 
not to expand that customer base would be to condemn our children and 
follow-on generations to a weak economy unable to provide the standard 
of living we have come to enjoy. And, therefore, I urge support of this 
trade agreement.
  Mr. BROWN of Ohio. Mr. Speaker, I yield myself such time as I may 
consume to note that I wish our trade policy were working as well for 
American manufacturing as my friends say it is.
  Mr. Speaker, could the Chair tell each of us how much time the three 
of us have remaining?
  The SPEAKER pro tempore (Mr. Hastings of Washington). The gentleman 
from Ohio has 13\1/2\ minutes remaining, the gentleman from Illinois 
(Mr. Crane) has 38 minutes remaining, and the gentleman from Michigan 
(Mr. Levin) has 19\1/2\ minutes remaining.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 2\1/2\ minutes to my 
colleague, the gentleman from Ohio (Mr. Strickland).
  Mr. STRICKLAND. Mr. Speaker, as a member of the Committee on 
Veterans' Affairs, I would like to call attention to information which 
was recently published by The Center for Policy Analysis on Trade and 
Health regarding the Australia Free Trade Agreement.
  CPATH's report explains that because chapter 15 of the U.S.-Australia 
Free Trade Agreement applies to Federal agencies like the Department of 
Veterans Affairs that procure pharmaceuticals, under the agreement drug 
companies would have the right to challenge VA procurement decisions. 
This would include VA decisions about coverage and pricing of 
pharmaceuticals. Virtually any aspect of coverage or pricing could be 
challenged based on technical specifications, timing, process, or any 
number of other agreements or disagreements.
  For example, a drug company could claim the VA's decision not to 
offer a particular drug is the result of an unfair assessment of the 
drug's effectiveness or economic value. Under the trade agreement, the 
drug company could then file a complaint against the VA based on these 
claims. If the VA's procurement decisions are delayed,

[[Page H5705]]

routinely contested, or reversed on a regular or irregular basis, there 
could be a serious effect on access to and prices for medications for 
our veterans.
  Before we vote on this free trade agreement, please consider this 
analysis and its potential effect on our Nation's veterans. It is a 
fact that the drug companies could challenge drug listing and pricing 
decisions by the VA. The government of Australia is not required to 
initiate or authorize these challenges. A drug company could do so. A 
drug company with an office in Australia could have standing to 
initiate such a challenge.
  Now, it does not have to be this way. Many procurement decisions are 
already excluded by both Australia and the United States under this 
agreement, including motor vehicles, the dredging at construction 
sites, and so on. Important government programs that provide benefits 
to millions, including vulnerable populations, can be legitimately 
added to the list of excluded measures. It was not done in this bill, 
and America's veterans are at risk as a result.
  It is important that before we vote on this trade bill that we read 
it and understand its potential negative effects upon America's 
veterans.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Australia is the eleventh largest market for Ohio goods exports, with 
total exports valued at around $389 million in 2003. Ohio primarily 
exports high-valued products to Australia, such as aircraft engines and 
parts, other aircraft parts, auto parts, forklifts, pet food, and 
household appliances. If the FTA was in place in 2003, over 93 percent 
of Ohio's exports would have entered Australia duty free.
  Ohio's exports to Australia directly support approximately 1,854 
jobs. Additionally, there are 17 Australian-owned companies in Ohio, 
employing 1,800 people, with 1,300 of these positions in manufacturing 
jobs. Trade with Australia supports countless other high-paying jobs in 
areas such as transportation, finance and advertising.
  The Bureau of Economic Analysis reports that Australian businesses 
have more than $817 million invested in Ohio.
  Mr. Speaker, I yield 2 minutes to the distinguished gentleman from 
Texas (Mr. Hensarling).
  Mr. HENSARLING. Mr. Speaker, I thank the gentleman for yielding me 
this time, and I rise today in strong support of the U.S.-Australia 
Free Trade Agreement.
  Study after study shows, and history confirms, that nations that are 
open to trade grow faster and enjoy higher per capita incomes than 
those that hinder trade. That means better housing, better health care, 
and better nutrition for all Americans.
  Mr. Speaker, we must recognize that nations do not trade with 
nations, people trade with people. By restricting trade, we are denying 
Americans access to more abundant and less costly goods and services. 
Just think about the local grocery store for a moment. Alongside the 
cheese from Wisconsin and beef from my home State of Texas, we have 
melons from Mexico, olive oil from Italy, and coffee from Colombia. By 
closing markets, by restricting markets, we limit choices for consumers 
and we drive up the cost of products that American families must 
purchase every day.
  Mr. Speaker, more importantly, when we restrict trade, we deprive 
Americans of their fundamental economic liberty. I believe Americans 
have a right to determine which products they want to purchase and from 
where those products come. With the exception of national security, it 
should not be the role of the Federal Government to tell American 
consumers where they can buy their goods.
  Also, when we restrict trade, we invariably put Americans out of 
work. We invite trade sanctions. Nearly one in every 10 jobs in the 
United States is directly linked to the export of U.S. goods and 
services.
  Last year, my home State of Texas exported almost $730 million in 
manufactured goods alone to Australia. From agriculture to aerospace, 
to computers and chemicals, jobs in Texas and America depend upon 
trade, including trade with Australia.
  Now, I have heard some Members talk about fair trade. But, Mr. 
Speaker, we must also remember that policies that protect some 
industries invariably hurt others; and protecting specific industries 
does nothing to protect the interest of American consumers or protect 
their economic liberties. I urge all of my colleagues to support the 
U.S.-Australia Free Trade Agreement.
  Mr. LEVIN. Mr. Speaker, it is my privilege and pleasure to yield 2 
minutes to the very distinguished gentleman from Texas (Mr. Green).
  Mr. GREEN of Texas. Mr. Speaker, I rise in support of the U.S.-
Australia Free Trade Agreement and this bill we are considering today 
to implement it.
  With few exceptions, I have historically opposed our free trade 
agreements because most of them have been negotiated with developing 
countries with insufficient labor and environmental standards.
  Now, following my colleague from Texas, obviously, we have different 
views on this free trade agreement. One of the things I am proud of is 
that not only do most of these earlier trade agreements have inadequate 
labor and environmental regulations and lower the standard of living 
for people residing in those countries, which inhibits the ability for 
U.S. companies to compete, when I opposed previous trade agreements it 
has always been on the basis that we are putting ourselves at a 
competitive disadvantage against countries that have significantly 
lower standards of living.
  However, this agreement with Australia is different. It puts the U.S. 
on a level playing field with a country that has comparable labor and 
environmental standards and a minimum wage that exceeds our own. I wish 
that were true with CAFTA and NAFTA and a whole bunch of other of our 
agreements.
  This is fair trade, and this is the kind of agreement I can support. 
This agreement will immediately eliminate 99 percent of all tariffs 
currently imposed on U.S. exporters. With 93 percent of all exports to 
Australia coming from the U.S. manufacturing sector, this agreement is 
estimated to boost our manufacturing exports to the tune of $2 billion.
  Without a doubt, there are parts of this agreement that I feel are 
less perfect. The agreement contains language allowing Australian 
pharmaceutical patent holders to prevent the export of their products 
to the U.S. market. In considering, though, that 90 percent of 
Australian drugs are currently prohibited from being exported by their 
law, I do not believe this agreement, in a practical sense, would hurt 
our current reimportation effort. However, I do make clear my 
opposition to the use of this provision as a precedent for future 
agreements.
  I would also like to note labor's concerns with the agreement. While 
not out-and-out opposing the agreement, the AFL-CIO has stated that the 
agreement is ineffective in protecting core worker rights in either the 
U.S. or Australia. As a former union printer, I take pride in working 
to strengthen labor rights in our own country; and I certainly agree 
that improvements can be made in our own country.
  Yet, on the whole, both the U.S. and Australia have exemplary labor 
laws that, given our constitutional democracies, are not likely to 
reach levels that impose significant threats to the health and safety 
of our workers.
  On balance, it is a fair agreement between two countries that value 
democracy, worker rights, and fair competition. It is not free trade. 
It is fair trade.
  Mr. CRANE. Mr. Speaker, I yield 2 minutes to my distinguished 
colleague, the gentleman from Illinois (Mr. Weller).
  Mr. WELLER. Mr. Speaker, I rise in support of the U.S.-Australia Free 
Trade Agreement, and I want to commend Ambassador Zoellick, the Special 
Trade Representative, and especially President Bush on the success of 
negotiating a good trade agreement that is good for American farmers, 
good for American workers, and good for American business.
  My home State of Illinois is one of the top States that currently 
exports to Australia. As you know, Illinois manufacturers, like 
manufacturers throughout the United States, were hard hit by the 
recession back in 2000 and 2001 and of course faced the consequences of 
the terrorist attack of 2001 and, in my State, suffered even heavier 
taxes imposed by our new governor and our new State legislature.

[[Page H5706]]

But I am happy to say that today Illinois manufacturing is starting to 
see some positive health, and that is good news.
  A key part of this economic turnaround is expanded trade 
opportunities. I would like to point out that my family has personally 
experienced the impact of our economy over the last decade. My brother, 
a manufacturing worker, he lost his job because of a lawsuit. But he 
got a new job because of a company that obtained an export contract. 
So, clearly, expanded free trade creates jobs for American workers.
  I particularly want to congratulate the architects and negotiators 
that produced this U.S.-Australia Free Trade Agreement. I would note 
that in the Australia-U.S. FTA more than 99 percent of U.S.-
manufactured exports to Australia will become duty free immediately 
upon entry into force of this agreement. This is the most significant 
immediate reduction of industrial tariffs ever achieved.
  Let me say that again: the most immediate reduction of industrial 
tariffs ever achieved in a United States free trade agreement. That is 
good news for industrial workers. What that means is $2 billion in 
additional demands for U.S. products.
  Agriculture is also key to my home State's economy, and I want to 
point out that under this agreement all U.S. agricultural exports to 
Australia will receive immediately duty free access to Australian 
markets. This trade agreement is good for Illinois farmers, it is good 
for Illinois workers, it is good for Illinois business, and it deserves 
bipartisan support. Please vote aye.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Ohio (Mr. Kucinich).
  (Mr. KUCINICH asked and was given permission to revise and extend his 
remarks.)
  Mr. KUCINICH. Mr. Speaker, it is important whenever we talk about 
trade that we realize that the United States has a massive trade 
deficit of over $500 billion; and while the gentleman has been 
repeatedly citing the benefits to various States, my own State has lost 
200,000 jobs during this administration. The United States, since the 
year 2000, has lost 3 million manufacturing jobs. So tell us about your 
free trade policies.
  If this legislation were only about trade, I could spend the rest of 
the time demolishing the arguments that have been offered here about 
the advantages that this trade agreement offers, but there is something 
that we need to focus on. Like most things around this Chamber, what 
you see is not what you get.
  The restriction on amendments imposed by Fast Track prevents Members 
of Congress from eliminating an extremely harmful precedent against 
lower cost pharmaceutical drugs set in the U.S.-Australia Free Trade 
Agreement. So my colleagues may think we are just voting about free 
trade here, but we are also voting on the issue of drug reimportation, 
because we cannot amend the trade agreement.
  The administration was able to lay the groundwork, in the words of 
the trade representative, for thwarting the reimportation of lower-cost 
pharmaceuticals. That is because the U.S.-Australia Free Trade 
Agreement codifies current U.S. law which the administration has made 
sure prohibits drug reimportation.
  So to all those people around the country who are wondering why can 
we not get lower price pharmaceuticals, this legislation is one of the 
ways in which they are going to ensure it will not happen. This is an 
element in the pharmaceutical industry's lobbying effort to keep prices 
high in the United States, and the administration has delivered for the 
industry at the cost of selling out Americans.
  We can predict with 100 percent certainty that the Australia trade 
agreement's prohibition on drug reimportation will be replicated in 
subsequent trade agreements and that it will have the effect of making 
it impossible for the United States to change U.S. law because the 
trade agreements will threaten the U.S. with trade sanctions if 
Congress does allow drug reimportation.
  This offense is so great and so threatening that this bill must be 
defeated. We must protect the ability to have drug reimportation.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume to 
simply remind all those paying any attention to the debate that we 
enjoy a $9 billion trade surplus with Australia at the present time, 
and that will expand greatly with the passage of this free trade 
agreement.
  Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield 2 minutes to a very distinguished 
colleague of mine, the gentleman from New York (Mr. Meeks).
  Mr. MEEKS of New York. Mr. Speaker, I rise today in support of H.R. 
4759, the U.S.-Australia FTA. This agreement is the most commercially 
significant bilateral trade agreement outside of North America that the 
United States has entered into. It also addresses several issues that 
we have concerns about dealing with labor, the environment, and human 
rights. Because of the strength and the size of Australia, we can deal 
and talk about rights that are respective for all.
  Plus, for example, in the automotive sector, free trade between the 
United States and Australia will allow greater trade opportunities in 
auto products between our two countries. U.S. auto makers produce over 
70 percent of all passenger vehicles made in Australia.
  Other industries also benefit from this agreement: 
telecommunications, financial services, and our technological firms, 
with greater intellectual property protections.
  Abroad, this agreement provides Australia with an opportunity to 
facilitate a higher quality of health care for its people. Though 
Australia has recognized the significant role played by innovative U.S. 
pharmaceutical companies in delivering high-quality health care, the 
problem of pharmaceutical price controls is still an issue. It is 
important that future trade negotiations more closely examine the 
possible impact of unfair trade practices that are shifting the cost of 
pharmaceutical research and development just simply to the American 
consumer.
  Mr. Speaker, this is a momentous agreement and is worthy of strong 
support from this body, for this is not just a free trade agreement, it 
is indeed, in every sense of the word, a fair trade agreement.
  Mr. CRANE. Mr. Speaker, I reserve the balance of my time.
  Mr. BROWN of Ohio. Mr. Speaker, how much time do we each have?
  The SPEAKER pro tempore. The gentleman from Ohio (Mr. Brown) has 9 
minutes remaining, the gentleman from Michigan (Mr. Levin) has 15\1/2\ 
minutes remaining, and the gentleman from Illinois (Mr. Crane) has 32 
minutes remaining.
  Mr. BROWN of Ohio. In light of that, Mr. Speaker, I would suggest the 
gentleman from Illinois (Mr. Crane) use some more of his time, because 
I am down to 9 minutes and the gentleman from Michigan (Mr. Levin) is 
down to 15. But perhaps the gentleman from Illinois would be willing to 
yield 5 minutes of his time over here, since he has no one to speak and 
we have so many speakers on this side.
  Mr. CRANE. I am sorry I cannot yield my time, but I will, Mr. 
Speaker, use some of my time at the present moment.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the administration strongly supports H.R. 4759, which 
will approve and implement the U.S.-Australia Free Trade Agreement as 
signed by the United States and Australia on May 18 of this year. The 
U.S.-Australia FTA advances U.S. national economic interests and meets 
the negotiating principles and objectives set out by the Congress in 
the Trade Act of 2002.
  The agreement enhances our close trade relationship with Australia 
and will further open Australia's market for U.S.-manufactured goods, 
agricultural products, and services. As soon as the FTA enters into 
force, tariffs will be eliminated on nearly all manufactured goods 
traded with Australia. In addition, Australia will eliminate tariffs on 
all exports of U.S. agricultural products.
  The U.S.-Australia FTA further solidifies our relationship with an 
important partner in the global economy and a strategic ally. It sets a 
strong example of the benefits of free trade and democracy. Opening 
markets is part of

[[Page H5707]]

the President's six-point plan for continuing to strengthen America's 
economy and to create more opportunities for American workers and 
farmers.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from New Jersey (Mr. Pascrell), who has been a real leader on trade 
issues in the last few Congresses.
  Mr. PASCRELL. Mr. Speaker, our Nation's trade policy is not so much a 
policy as an ideology, and those in the Office of the Trade 
Representative bow at the altar of free trade.
  One way we can level the playing field in trade is to put labor and 
environmental standards on equal footing with other commercial 
sections, and why should that not be, such as intellectual property 
rights, patents, goods and services.
  While the Australia FTA does a great job of mentioning the 
international labor organization and saying the right things, the proof 
is in the enforcement, and that is lacking in the legislation. The 
agreement's enforcement procedure excludes an obligation for both 
governments to meet the international labor organization or any other 
definable standard.

                              {time}  1545

  In the Jordan FTA, which many look to as a model of how the agreement 
should be written, we had input into that agreement. Labor and 
environmental articles used the same dispute settlement procedures as 
every other commercial provision. This is not the case under the 
Australia agreement.
  Let us go to the videotape. Article 18.6.5 clarifies that the key 
pieces of chapter 21, dispute settlement, ``shall not apply to a matter 
arising under any provision of this chapter other than article 
18.2.1.''
  Excluding 18.1 and 18.2 from any possibility of dispute settlement or 
enforcement leaves the sole enforceable labor obligation in these 
agreements that countries need to ``enforce their own labor laws.''
  This is terrible. And while Australia has a strong labor and 
environmental protection, what we are doing in this legislation is 
saying if we cannot add strong labor and environmental agreements with 
Australia, who the heck can we add it with? Then we are going to get a 
solid gold standard when it comes to property rights and commercial 
rights, but we are not willing to do it to labor and the environment?
  This stinks, and you know it. And we are not going to pray at that 
altar.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, Australia is the 15th largest market for New Jersey 
goods exports, with total exports valued at nearly $307 million in 
2003. New Jersey primarily exports high-valued products to Australia 
such as pharmaceuticals, printed media, medical equipment, perfumes, 
and chemicals. If the FTA was in place in 2003, 99.44 percent of New 
Jersey's exports would have entered Australia duty free. New Jersey's 
exports to Australia directly support approximately 1,400 jobs. 
Additionally, there are 13 Australian-owned companies in New Jersey, 
employing 900 people. Seven hundred of these positions are 
manufacturing jobs.
  Trade with Australia supports numerous other high-paying jobs in 
areas such as transportation, finance, and advertising.
  Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield 1 minute to the gentleman from North 
Dakota (Mr. Pomeroy), my colleague on the Committee on Ways and Means.
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  I find this agreement to be somewhat of a close call. But where I 
come from we have an expression ``once burned, twice cautious.''
  We are a major producer of wheat, and yet our farmers compete not 
just against the wheat farmers of other countries. In some instances, 
they compete against their governments as well, because their 
governments countenance a monopoly marketing mechanism called wheat 
board. When the Canadian Wheat Board was allowed to continue its 
operations in the Canadian Free Trade Agreement and the North American 
Free Trade Agreement, what unleashed upon our farmers was a 
dramatically unfair set of circumstances that have left them at a 
disadvantage and cost them markets and market value to the loss of 
millions and millions of dollars.
  The U.S. Trade Representative has announced his opposition to state 
trading enterprises like the Canadian Wheat Board, but in this 
agreement we see the Australian Wheat Board, a very similar state 
trading enterprise, being allowed to continue without mention in the 
agreement. Unfortunately, this leads me to conclude this agreement 
should not go forward. We need more action against state trading 
enterprises.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  I want to congratulate my colleague from North Dakota on his support 
for this Free Trade Agreement and also explain to folks that Australia 
is the third largest market for North Dakota goods exports, with total 
exports valued at over $47 million in 2003. North Dakota's exports to 
Australia include tractors, front-end loaders, beans, and agricultural 
sprayers. These exports support approximately 220 jobs in North Dakota. 
The Australia-U.S. Free Trade Agreement provides tremendous 
opportunities for North Dakota businesses, offering them preferential 
access to a strong economy and growing market. And I think the 
gentleman's folks back home will particularly appreciate his support, 
as do all the rest of us, for this important Free Trade Agreement.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BROWN of Ohio. Mr. Speaker, I am glad the gentleman from North 
Dakota (Mr. Pomeroy) is voting ``no,'' also.
  Mr. Speaker, I yield 2 minutes to the gentlewoman from Connecticut 
(Ms. DeLauro), and I thank her for her leadership on trade issues and 
fighting for American jobs.
  Ms. DeLAURO. Mr. Speaker, the Australia Free Trade Agreement is for 
the most part a good agreement with a strong U.S. ally. But because it 
is becoming increasingly clear that the reimportation of prescription 
drugs from other countries is on the horizon, so much so that even the 
Secretary of Health and Human Services has said that it is coming, this 
administration, in cooperation with this majority, has included a 
provision into a bill designed to stave off the inevitable, this time 
interfering with the reimportation of a patented product into the 
United States in a trade agreement and setting a bad precedent for 
other agreements with western developed countries.
  American seniors, fed up with discount cards that do nothing to 
reduce their drug costs, should not be fooled by this. The Republican 
leadership has failed to win the reimportation debate on every level. 
The American people disagree with them. Their own members disagree with 
them. Absent Republican support, this body would not have voted to 
legalize the practice last year with 243 bipartisan Members.
  Putting any reimportation legislation passed by this Congress in 
violation of free trade is their goal in this agreement. It is not 
enough for the drug companies to do everything in their power to 
prevent the United States from lowering the cost of drugs. Now, through 
international trade laws, they are trying to cut off the ability of 
others to reimport safe, affordable drugs and the efforts of what other 
countries do for their citizens as well. So when the United States 
Trade Representative says that his core objectives in negotiating this 
deal were ``rewarding innovation and R&D'' and ``due process,'' what he 
is actually saying is that the drug companies should be able to keep 
their prices as high as they want for as long as they want in America 
and across the world.
  Before we press ahead with this Free Trade Agreement offered under a 
closed, nonamendable process, I urge my colleagues to consider the very 
serious ramifications of this bill on every single person in this 
country struggling to keep up with the skyrocketing cost of 
prescription drugs. Absent allowing the Federal Government to negotiate 
the price of prescription drugs, the safe importation of drugs from 
other countries is the only way that ordinary people can afford the 
drugs they need. That is what is at stake with this legislation.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.

[[Page H5708]]

  Mr. Speaker, I would like to reiterate a comment I made earlier from 
the Dear Colleague released yesterday by the gentleman from Michigan 
(Mr. Levin) and the gentleman from New York (Mr. Rangel). And it says: 
``The patent provision will not have a practical effect due to the fact 
that Australia's domestic law prohibits the export of drugs purchased 
through its government-subsidized program which accounts for over 90 
percent of all drugs sold in Australia.''
  Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
California (Mr. Dooley).
  Mr. DOOLEY of California. Mr. Speaker, I rise in strong support of 
this trade agreement, and I want to commend Ambassador Zoellick and his 
team at USTR for the negotiations of such a fine and fair agreement. I 
want to thank the gentleman from California (Chairman Thomas) and the 
gentleman from New York (Mr. Rangel), ranking member, and the gentleman 
from Michigan (Mr. Levin) and the gentleman from Illinois (Mr. Crane) 
for the great work that they have done too.
  There is never going to be an absolutely perfect trade agreement. But 
we can come close, and this agreement does. And if we cannot pass an 
agreement with one of our strongest allies who has been a partner with 
us in every challenge to try to provide for greater international 
security in the last century, whom can we be an economic partner with? 
If we cannot pass a fair trade agreement and a free trade agreement 
with a country that has the same level of economic development that we 
have in this country, whom can we adopt a fair trade agreement with? If 
we cannot adopt a fair trade agreement with a country that has higher 
labor standards, as equal or better environmental standards than we 
have in the United States, whom can we adopt a fair trade agreement 
with?
  This is a solid agreement. It is an agreement that will provide 
greater economic opportunities for the workers in the United States and 
the businesses that employ them. We should be passing this agreement 
with a unanimous vote. It is unfortunate that we will get close but not 
quite there.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I want to congratulate the distinguished gentleman from 
California (Mr. Dooley) for his commitment to these fundamental 
principles that are involved here in the best interest of this country 
as well as our good friend and ally Australia for all these years. I 
thank him.

                              {time}  1600

  Mr. Speaker, I yield 3 minutes to the distinguished gentleman from 
Florida (Mr. Shaw).
  Mr. SHAW. Mr. Speaker, I would like to rise in very strong support of 
the Australian Free Trade Agreement. I do not think there is any 
country in the world that is more loved by Americans than the country 
of Australia, and I do not think there is any country in the world that 
can claim greater loyalty to this friendship than Australia and the 
United States to each other.
  I would like to congratulate Ambassador Bob Zoellick for the fair and 
solid trade agreement with this long-time ally and, of course, our own 
President Bush for pushing forward. Also, I congratulate the Australian 
Prime Minister John Howard and Ambassador Michael Thawley on their 
commitment for also securing this agreement.
  The Australian government has been a long-term friend to the United 
States through all the world wars and, of course, now in the war on 
terror and the other wars we have been involved in in Asia. They have 
been a staunch ally and a great friend, and I guess they are very 
similar to the Americans, having evolved in a similar way and having 
gained their independence.
  I would like to now, for just a moment, to turn our attention to the 
effects this agreement would have on my own State of Florida. Florida 
exports shipments of merchandise to Australia. In 2003, it totaled $319 
million. That is an increase of 12 percent from 2002. Florida ranks 
10th in overall export shipments to the Australian market. Overwhelming 
amounts of Florida exports are in the manufacturing sector, a sector 
tremendously important to the United States and Florida. This agreement 
provides increased access for numerous other Florida sectors which have 
very positive impact on the State of Florida as well as the entire 
country.
  I recommend and endorse this most important and most historic 
agreement, urge its passage; and as the previous speaker said, this 
should be a unanimous, if not near unanimous, decision that came out, 
as I recall, in the full Committee on Ways and Means with a unanimous 
vote, and it is one of the few truly bipartisan trade agreements that 
we have seen come through this House in recent years, and I urge its 
passage.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 1 minute to the gentleman 
from Illinois (Mr. Emanuel).
  Mr. EMANUEL. Mr. Speaker, I thank the gentleman from Ohio for 
yielding me this time.
  I rise to express my disappointment that an otherwise strong Free 
Trade Agreement has been tainted by provisions designed to protect a 
captive market for the prescription drug industry in this country, 
forcing American senior citizens and taxpayers to pay higher prices 
than normal.
  Australia has the lowest pharmaceutical prices anywhere in the world, 
of developed countries, that is, anywhere. I have supported NAFTA. I 
have supported GATT. I voted in favor of Singapore. I voted in favor of 
Chile. I believe in free trade. But what we attempted here was a back-
door attempt to continue to force Americans to pay the highest drug 
prices anywhere in the world. And we had an opportunity to literally do 
something different with a good free trade agreement.
  It all makes sense. Eli Lilly, Schering-Plough, PhRMA were all on the 
advisory board to the USTR when it came to negotiating this trade deal, 
and we are setting a precedent, forcing Americans again to continue to 
pay the highest pharmaceutical prices than anywhere in the world when 
we could have provided Americans the chance of a free trade agreement 
where we reopen markets, bring in competition, lower the prices around 
the world. But we did not do that. So we took an ally and tried to 
actually, in the negotiations, force them to walk away from their 
health care. One does not force a friend and ally to walk away from a 
good health care program who is paying lower prices for prescription 
drugs than anywhere in the world.
  I will not support this agreement on behalf of the senior citizens of 
this country.
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would like to remind my colleague that the Australian 
government prohibits the export of drugs from Australia. They subsidize 
drugs for their own people, and they prohibit the export of those 
drugs.
  Mr. Speaker, I yield 2 minutes to another gentleman from Florida (Mr. 
Mario Diaz-Balart). This is not a repeat. This is his younger brother.
  Mr. MARIO DIAZ-BALART of Florida. Mr. Speaker, I rise to comment on 
the exceptional relationship between Australia and the United States.
  On this day that we are voting on this Free Trade Agreement, Mr. 
Speaker, we should take a minute to express our gratitude, our deep 
gratitude, to the Australians for their support in the international 
war on terror. Their support in the aftermath of September 11, Mr. 
Speaker, both in Afghanistan and in Iraq is a testament, a very strong 
testament, again to the strength of this alliance between the two 
countries. The Australians have also been touched, unfortunately, 
tragically, by terrorism when 88 Australians died in the Bali bombings 
of 2002.
  Mr. Speaker, in friendship we will continue to reach out to them as 
they have to us. On this day we thank our mates down under for this 
friendship and commend them for their commitment to negotiating this 
Free Trade Agreement. Anyone, Mr. Speaker, anyone, who questions the 
strength of our alliance is, frankly, just out of touch or, to quote 
the famous slang used by our friends in Australia, they have ``too many 
kangaroos loose in the top paddock.''
  Mr. CRANE. Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I reserve the balance of my time.
  Mr. BROWN of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.

[[Page H5709]]

  I am down to 4 minutes because of the passion on this side. I am the 
only opponent of the three, and it is pretty clear we are the biggest 
number of the House in the passion we share in opposition to this trade 
agreement.
  Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from Maryland (Mr. Hoyer), our distinguished whip.
  Mr. HOYER. Mr. Speaker, I thank the gentleman from Michigan for 
yielding me this time.
  Mr. Speaker, this important Free Trade Agreement will enhance the 
already strong economic ties that exist between the United States and 
Australia. I support this agreement and will vote in favor of the 
required implementing legislation.
  This pact has been called the ``manufacturing FTA'' because of the 
extent to which the United States manufacturing sector will benefit 
from the expanded market access provided by this agreement. Perhaps 
most importantly, Mr. Speaker, more than 99 percent of remaining 
Australian duties on U.S.-manufactured goods will be lifted the day the 
agreement takes effect. It is estimated that this immediate tariff 
elimination will result in an additional $2 billion in annual exports 
to Australia, already one of the world's largest single markets for 
U.S. goods. This improved market access will benefit American 
companies, ranging from aircraft manufacturers to automakers to 
construction equipment suppliers.
  Manufacturers, however, will not be the only beneficiaries of this 
agreement. All U.S. agricultural exports to Australia will receive 
immediate duty-free access, and market access will be provided to 
American telecommunications, computer, energy, and financial services 
companies, among others.
  Mr. Speaker, I have and will continue to support free trade 
agreements that balance the need for expanding markets for American 
companies with the importance of providing a level playing field for 
American workers and protection for the environment. We must consider 
the specific labor and environmental conditions that exist in the 
countries that we seek to trade with as well as the provisions included 
in the agreements to protect workers both here and in other countries 
and environmental concerns as well.
  I am confident, Mr. Speaker, that these goals will be met with 
respect to Australia. Australia is almost a mirror economy of the 
United States; and, in that context, I think we can have real 
confidence that this will be an agreement that will benefit America, 
benefit Australia, and benefit our workers as well.
  Mr. CRANE. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from California (Mr. Cunningham).

                              {time}  1615

  Mr. CUNNINGHAM. Mr. Speaker, I rise in full support of this 
agreement. First of all, many folks in the military that have traveled 
around the world, no matter where I have gone, where we needed allies, 
Australia has been beside us. Through all the world wars, through 
Desert Storm, through the continuing evolutions we are going through 
right now, they have been a strong ally. They deserve this.
  I hear many Members talking about manufacturing jobs and the loss of 
manufacturing jobs. For California, this benefits our manufacturers, in 
biotech and electronics, machinery and a whole host of others, which 
creates jobs. That is good for us on a fair trade measure.
  I also want to tell you that if you have ever been on an aircraft 
carrier and go into Australia, it is not much different than going into 
a city in the United States. Those people are friendly, they are 
allies, and they love the United States.
  I heard when I was watching on television, though, about the issue on 
reimportation of prescription drugs. Many nations subsidize their 
drugs, like Australia, like Canada, like the Netherlands; and in those 
cases they will not reimport them because their own government 
subsidizes them for low cost. They have government control of their 
prescription drug programs.
  We are working on a program to make sure that those imported drugs 
are safe. The Secretary has said that and is working diligently on it, 
and I think before long we will have a safe program where we can 
reimport drugs into this country and make them cheaper.
  But I also remind my colleagues there are a lot of other things we 
can do locally to make sure that happens. The FDA, we threatened to 
privatize them at one time because they were so slow, and they sped up.
  If you look at the patent laws that we have, quite often a biotech 
company will produce a drug, and they have got still people working in 
their businesses, and they do not know if they are going to be able to 
realize the benefits from that or not. It may take 2, 3, 4, sometimes 5 
years to get through the process; and at the end of that, the patent 
law runs out, so they have to get an exorbitant price of that 
particular drug just to recoup their benefits.
  These are things that I think we can do locally, besides the 
reimportation, and make it safe. There is no one that does not support 
it, if it is safe for the American population.
  Mr. Speaker, I rise in strong support. I thank the chairman for the 
time and for bringing forth this bill.
  Mr. BROWN of Ohio. Mr. Speaker, I yield 2 minutes to the gentlewoman 
from Toledo, Ohio (Ms. Kaptur), who perhaps knows more than anybody in 
this body about international trade.
  Ms. KAPTUR. Mr. Speaker, I thank the gentleman from Ohio, and I doubt 
anyone can hold a candle to him relative to trade.
  Mr. Speaker, I rise in opposition to this trade proposal, in a way 
reluctantly. I had held such hope that this particular proposal could 
be the template for trade agreements that could be negotiated between 
the developed democracies of the world, and that following on the 
Jordan Free Trade Agreement, we could actually produce the first trade 
agreement between developed democracies that would provide the gold 
standard for the world, that we could really use proactively. This one 
falls far short of doing that.
  You might ask the question, Would we have this agreement before us if 
Australia did not have troops in Iraq? It is kind of interesting that 
this is coming up at this particular moment.
  One of my concerns about this agreement is that Australia may become 
another back door trade route to the U.S., sort of the new Hong Kong, 
because of all the current difficulties in Hong Kong NOW. This 
agreement is imperfect. It does not really provide a comprehensive set 
of provisions to really deal with trade between nations that want 
higher standards of living, but that in fact you will get more Chinese 
goods and Chinese investment going into Australia and then coming here 
under this so-called ``free trade'' agreement because of all the 
economic and commerical difficulties that Hong Kong is having since the 
handover to the Chinese.
  We know that this particular agreement would allow drug companies to 
challenge decisions on coverage and payment, so we further weaken the 
abilities of developed democracies to try to provide affordable health 
care for all their people.
  The agreement is absolutely inadequate in terms of comprehensive 
labor and environmental standards. We should accept no less. In fact, 
my dream would be that we would learn how to strike trade agreements 
between developed countries, and then ask third world nations to join 
that consortium in order to raise standards of living around the world, 
rather than force all nations in this race to the bottom, including our 
own, where wages among the majority have fallen.
  Mr. Speaker, I include for the Record an article from the Wall Street 
Journal, ``Trade Agreement May Undercut Importing of Inexpensive 
Drugs,'' and also a set of standards we should use in any trade 
agreement based on a review of some of our other trade agreements. 
There standards should be expected from any trade agreement this Nation 
negotiates.
  I ask my colleagues to vote ``no.'' This agreement is too incomplete 
and imperfect.

                [From the New York Times, July 12, 2004]

      Trade Agreement May Undercut Importing of Inexpensive Drugs

                 (By Elizabeth Becker and Robert Pear)

       Washington, July 11.--Congress is poised to approve an 
     international trade agreement that could have the effect of 
     thwarting a goal pursued by many lawmakers of both

[[Page H5710]]

     parties: the import of inexpensive prescription drugs to help 
     millions of Americans without health insurance.
       The agreement, negotiated with Australia by the Bush 
     administration, would allow pharmaceutical companies to 
     prevent imports of drugs to the United States and also to 
     challenge decisions by Australia about what drugs should be 
     covered by the country's health plan, the prices paid for 
     them and how they can be used.
       It represents the administration's model for strengthening 
     the protection of expensive brand-name drugs in wealthy 
     countries, where the biggest profits can be made.
       In negotiating the pact, the United States, for the first 
     time, challenged how a foreign industrialized country 
     operates its national health program to provide inexpensive 
     drugs to its own citizens. Americans without insurance pay 
     some of the world's highest prices for brand-name 
     prescription drugs, in part because the United States does 
     not have such a plan.
       Only in the last few weeks have lawmakers realized that the 
     proposed Australia trade agreement--the Bush administration's 
     first free trade agreement with a developed country--could 
     have major implications for health policy and programs in the 
     United States.
       The debate over the drug imports, an issue with immense 
     political appeal, has been raging for 4 years, with little 
     reference to the arcane details of trade policy. Most trade 
     agreements are so complex that lawmakers rarely investigate 
     all the provisions, which typically cover such diverse areas 
     as manufacturing, tourism, insurance, agriculture, and 
     increasingly, pharmaceuticals.
       Bush administration officials oppose legalizing imports of 
     inexpensive prescription drugs, citing safety concerns. 
     Instead, with strong backing from the pharmaceutical 
     industry, they have said they want to raise the price of 
     drugs overseas to spread the burden of research and 
     development that is borne disproportionately by the United 
     States.
       Many Democrats, with the support of AARP, consumer groups 
     and a substantial number of Republicans, are promoting 
     legislation to lower drug costs by importing less expensive 
     medicines from Europe, Canada, Australia, Japan and other 
     countries where prices are regulated through public health 
     programs.
       These two competing approaches represent very different 
     ways of helping Americans who typically pay much more for 
     brand-name prescription drugs than people in the rest of the 
     industrialized world.
       Leaders in both houses of Congress hope to approve the free 
     trade agreement in the next week or two. Last Thursday, the 
     House Ways and Means Committee endorsed the pact, which 
     promises to increase American manufacturing exports by as 
     much as $2 billion a year and preserve jobs here.
       Health advocates and officials in developing countries have 
     intensely debated the effects of trade deals on the ability 
     of poor nations to provide inexpensive generic drugs to their 
     citizens, especially those with AIDS.
       But in Congress, the significance of the agreement for 
     health policy has generally been lost in the trade debate.
       The chief sponsor of the Senate bill, Senator Byron L. 
     Dorgan, Democrat of North Dakota, said: ``This administration 
     opposes re-importation even to the extent of writing barriers 
     to it into its trade agreements. I don't understand why our 
     trade ambassador is inserting this prohibition into trade 
     agreements before Congress settles the issue.''
       Senator John McCain, an author of the drug-import bill, 
     sees the agreement with Australia as hampering consumers' 
     access to drugs from other countries. His spokesman said the 
     senator worried that ``it only protects powerful special 
     interests.''
       Gary C. Hufbauer, a senior analyst at the Institute for 
     International Economics, said ``the Australia free trade 
     agreement is a skirmish in a larger war'' over how to reduce 
     the huge difference in prices paid for drugs in the United 
     States and the rest of the industrialized world.
       Kevin Outterson, an associate law professor at West 
     Virginia University, agreed.
       ``The United States has put a marker down and is now using 
     trade agreements to tell countries how they can reimburse 
     their own citizens for prescription drugs,'' he said.
       The United States does not import any significant amount of 
     low-cost prescription drugs from Australia, in part because 
     federal laws effectively prohibit such imports. But a number 
     of states are considering imports from Australia and Canada, 
     as a way to save money, and American officials have made 
     clear that the Australia agreement sets a precedent they hope 
     to follow in negotiations with other countries.
       Trade experts and the pharmaceutical industry offer no 
     assurance that drug prices will fall in the United States if 
     they rise abroad.
       Representative Sander M. Levin of Michigan, the senior 
     Democrat on the panel's trade subcommittee, voted for the 
     agreement, which could help industries in his state. But Mr. 
     Levin said the trade pact would give a potent weapon to 
     opponents of the drug-import bill, who could argue that 
     ``passing it would violate our international obligations.''
       Such violations could lead to trade sanctions costing the 
     United States and its exporters millions of dollars.
       One provision of the trade agreement with Australia 
     protects the right of patent owners, like drug companies, to 
     ``prevent importation'' of products on which they own the 
     patents. Mr. Dorgan's bill would eliminate this right.
       The trade pact is ``almost completely inconsistent with 
     drug-import bills'' that have broad support in Congress, Mr. 
     Levin said.
       But Representative Bill Thomas, the California Republican 
     who is chairman of the Ways and Means Committee, said, ``The 
     only workable procedure is to write trade agreements 
     according to current law.''
       For years, drug companies have objected to Australia's 
     Pharmaceutical Benefits Scheme, under which government 
     officials decide which drugs to cover and how much to pay for 
     them. Before the government decides whether to cover a drug, 
     experts analyze its clinical benefits, safety and ``cost-
     effectiveness,'' compared with other treatments.
       Joseph M. Damond, and associate vice president of the 
     Pharmaceutical Research and Manufacturers of America, said 
     Australia's drug benefit system amounted to an unfair trade 
     practice.
       ``The solution is to get rid of these artificial price 
     controls in other developed countries and create real 
     marketplace incentives for innovation,'' Mr. Damond said.
       While the trade pact has barely been noticed here, it has 
     touched off an impassioned national debate in Australia, 
     where the Parliament is also close to approving it.
       The Australian trade minister, Mark Vaile, promised that 
     ``there is nothing in the free trade agreement that would 
     increase drug prices in Australia.''
       But a recent report from a committee of the Australian 
     Parliament saw a serious possibility that ``Australians would 
     pay more for certain medicines,'' and that drug companies 
     would gain more leverage over government decisions there.
       Bush administration officials noted that the Trade Act of 
     2002 said its negotiators should try to eliminate price 
     controls and other regulations that limit access to foreign 
     markets.
       Dr. Mark B. McClellan, the former commissioner of food and 
     drugs now in charge of Medicare and Medicaid, said last year 
     that foreign price controls left American consumers paying 
     most of the cost for pharmaceutical research and development, 
     and that, he said, was unacceptable.

                           Executive Summary


                  NAFTA and The Future of Global Trade

       The North American Free Trade Agreement (NAFTA) is now ten 
     years old. At its heart, it embodies the new heroic struggle 
     of working men and women to gain a foothold in the rough and 
     tumble global economy dominated by multinational corporate 
     giants. Unfortunately, it pits local workers and farmers 
     against global investors. It pits Neustro Maiz, a peasant 
     tortilla co-op in southern Mexico, against ADM, the US grain 
     trade giant. It pits Norma McFadden of Sandusky, Ohio, who 
     lost her middle class job with benefits at Dixon Ticonderoga, 
     against Ana Luisa Cruz of Cuidad Juarez, who earns $7 a day 
     with no benefits. For NAFTA to be credible as a model for 
     future trade agreements, it must be amended. People should be 
     more important than goods. A human face to trade must be 
     negotiated. Without it, the global divide between poverty and 
     wealth will exacerbate. More popular unrest will result from 
     unfair trade, and the social compact so necessary for global 
     cooperation will be shattered.
       NAFTA is important because it serves as the major template 
     for a new global economic order integrating rich and poor 
     nations through trade and investment. Mexico, Canada and the 
     U.S. were to integrate their economies and, as a result, be 
     better positioned to compete globally. It was touted as the 
     neo-liberal model that would lift the economic condition of 
     all people. All ships, no matter how small, were to be 
     brought forward. But NAFTA worked exactly in the reverse. 
     Affected workers in all three nations saw their wages and 
     working conditions lowered. As capital moved across borders 
     with no social policies in place, NAFTA has triggered an 
     international race to the bottom as even Mexico has lost 
     218,000 jobs to China, a lower wage environment with a 
     notorious record of human rights abuses.
       Capital and wealth have become more concentrated in all 
     three nations. The middle class in the U.S. is experiencing a 
     growing squeeze on benefits and job quality. In Mexico, an 
     endless supply of ``starvation wage'' workers was unleashed. 
     Now the Bush Administration is trying to spread the same 
     model to Central America using Central American Free Trade 
     Agreement (CAFTA), and throughout the rest of the Western 
     Hemisphere with the Free Trade Area of the Americas (FTAA). 
     If these agreements are passed, it is clear that only the 
     same can be expected, that is, expanding job washout, 
     underemployment, and trade deficits in the U.S. without 
     improved living standards in the poor countries with whom it 
     trades.
       A reformed trade model among trading nations is needed that 
     yields rising standards of living for workers and farmers. 
     This must be based on transparent and enforceable rules of 
     law concerning labor, environment and business. Continental 
     sustainable wage and labor standards should be adopted. Trade 
     accords must also incorporate industrial and agricultural 
     adjustment provisions, and currency alignment. An 
     infrastructure investment plan should be negotiated as a core 
     provision of any trade agreement. Along with complementary 
     systems for education and safe, reliable medical care for all 
     of their citizens, including the over 9 million immigrants 
     traveling as itinerant labor to the U.S. every year.

[[Page H5711]]

                            recommendations

       Policy reforms are essential to amending NAFTA and other 
     trade agreements that have yielded such huge U.S. trade 
     deficits, job washout, and lowered standards of living.


  a continental assessment of nafta should be launched to address its 
                              shortcomings

       An intracontinental parliamentary Working Group on Trade 
     and Working Life in America, comprised of U.S., Mexican, and 
     Canadian members, should be established with the goal of 
     amending NAFTA to address its shortcomings. Such a working 
     group should analyze the results of NAFTA and its impact on 
     workers, farmers and communities. The Working Group should 
     define a sustainable wage standard for workers in each 
     country and a continental labor registration system along 
     with enforceable labor and environmental standards. It would 
     identify the massive continental labor displacements that are 
     occurring, often with no social safety net in place. It would 
     explore options to deal with divergence in education and 
     health as well as currency fluctuations and impact of trade 
     on infrastructure, investment, and migration. It would 
     harmonize inequitable tax systems and augment credit systems 
     for the safe and non-usurious continental transfer of 
     remittances by mobile workers. It would also propose funds in 
     the form of adjustment assistance to cushion continental 
     economic integration. The organization would include as a key 
     component an intracontinental Agricultural Working Committee 
     to address the hardships faced by farmers and farm labor in 
     all three countries.


              trade agreements should yield trade balances

       If NAFTA were working in the interests of the U.S., there 
     would be a trade surplus with Canada and Mexico, as the U.S. 
     exported more than it imported. Exactly the reverse is true. 
     In 2003, the NAFTA trade gap equaled $100 billion--$42 
     billion with Mexico and $85 billion with Canada. This 
     represents a serious drag on U.S. gross domestic product and 
     a loss of wealth. Indeed the U.S.-NAFTA trade balance with 
     low-wage Mexico as well as Canada has turned decidedly more 
     negative, and worsened each year, contrary to NAFTA's stated 
     aims. When a trade agreement yields major and growing 
     deficits for more than three years, it ought to be 
     renegotiated.


              develop an alternative trade block paradigm

       Trade agreements must be structured to achieve rising 
     standards of living for a broad middle class, not just the 
     capital class. The current NAFTA model fails to address the 
     root causes of market dysfunction and growing U.S. trade 
     deficits i.e., the managed market and regulated trade 
     approaches being employed by its European and Asian 
     competitors. With NAFTA, the U.S. chose a low wage strategy 
     to meet this real competition from trading counterparts that 
     were gaining global edge. The U.S. must counter the managed 
     market and regulated trade approaches of its major 
     competitors.


                 harmonize quality of life up, not down

       Rather than allowing transnational companies to set the 
     rules of engagement, democratic nations first should forge 
     international trade agreements with the world's developed 
     democracies and then invite in developing nations to 
     participate in this ``free world'' Global Trade Organization. 
     Such an effort holds the potential to transition these 
     nations upward to the same democratic, legal, and 
     environmental systems of the free world. Instead, the trade 
     relationships that have been forged link the economic systems 
     of first world democratic nations to Third World, 
     undemocratic, non-transparent systems. Social concerns like 
     education, environment, infrastructure, labor conditions, and 
     health have been ignored. The downward ``race to the bottom'' 
     push of NAFTA continues to be felt in the U.S. as well as 
     Mexico and Canada.


  trade accords should produce living wage jobs, less poverty and an 
                          improved environment

       If NAFTA were working, more good U.S. jobs would be 
     created, outnumbering job losses. In Mexico, workers would 
     experience a rising standard of living. Exactly the opposite 
     is true. Conservative estimates indicate the U.S. has lost 
     880,000 jobs due to NAFTA. These jobs are largely in U.S. 
     companies that merely relocate to Mexico paying ``hunger 
     wages.'' Wages in Mexico have been cut by a third. If NAFTA 
     were working in the interest of Mexicans, there would be a 
     reduction in poverty, a growing middle class, and 
     environmental improvement. Instead there is a rollback in 
     wages, deplorable working conditions, and growing economic 
     concentration of wealth in a few hands, forcing huge social 
     dislocation.
       As U.S. jobs are sucked into Mexico, not only do more 
     people vanish from the middle class but also U.S. schools 
     lose property taxes. In a state like Ohio that has lost 
     nearly 200,000 jobs to Mexico, the economic decline is 
     visible. Ohio's income growth is declining. In 1999, 
     according to Ohio Department of Development statistics, 
     citizens in Ohio lost $30.7 billion in total income compared 
     to the past year. The state itself lost $15 billion. As a 
     result, college tuition has increased, with average student 
     undergraduate debt rising to record levels of $18,900. 
     Nursing homes are understaffed with low paid workers, and the 
     ranks of uninsured Ohioans has risen to 1.3 million. The 
     State is raising taxes on everything from sales, to gas 
     and to property to try to fill the gap of a fleeing 
     private sector. Quality of life is sliding backwards. 
     NAFTA-related environmental enforcement remains largely 
     nonexistent. If NAFTA were working, environmental 
     improvement in Mexico would be upgrading; it is sliding 
     backward.
       Transition U.S./Canadian displaced workers to comparable 
     employment and Mexico's workers and peasants to land holding 
     and living wage standard.
       NAFTA--displaced workers in the U.S. largely have been 
     abandoned in their efforts to reposition to new employment. 
     Unemployment benefits expire, training is inadequate, and 
     health benefits expire or are unaffordable. Experienced 
     workers rarely find jobs with comparable pay or benefits. 
     Mexico's vast underclass, underpaid, and exploited, lacks a 
     living wage, affordable elementary education, basic health 
     care, and systems to gain property ownership and affordable 
     credit even for basic purchases. In order to move forward 
     with any future trade agreements, NAFTA must acknowledge its 
     human toll and respond accordingly. NAFTA provisions have led 
     to the displacement of thousands of small business, 
     industrial and agricultural workers throughout the U.S., 
     Mexico and Canada. Little provision has been made to assist 
     these workers, farmers, and communities with any transitional 
     adjustment assistance. In Mexico, this has caused masses of 
     people to stream toward the border and the maquiladora zones 
     in search for jobs.
       The North American Development Bank, which was established 
     to help local communities build their human and physical 
     infrastructures, has been an abject failure. It should 
     promote economic investment in those regions of Mexico and 
     the United States where jobs have been hollowed out due to 
     NAFTA, or infrastructure is needed. Bank assets could be 
     enhanced by financial contributions that flow from trade-
     related transactions.
       Create new continental law enforcement body to combat 
     growing crime along U.S.-Mexico border region related to 
     border workers, drugs, and unsolved murders of hundreds of 
     Mexican women.
       The United States Departments of Labor and Homeland 
     Security should be tasked not only with stopping the 
     trafficking of bonded laborers but devising a continental 
     labor identification card. Along with mass migration, the 
     border has seen an explosion in the illicit drug trade. Law 
     enforcement officers on both sides of the border must battle 
     smuggling in narcotics and persons. A continental working 
     group should be directed to recommend a new solution for 
     combating crimes that result from the illegal drug and bonded 
     worker trade that spans the border.

  Mr. CRANE. Mr. Speaker, I yield 4 minutes to the distinguished 
gentleman from Arizona (Mr. Kolbe).
  Mr. KOLBE. Mr. Speaker, I thank the gentleman for yielding me time.
  Let me begin by saying to the gentleman from Illinois that I want to 
congratulate him and thank him for his leadership in the area of trade. 
Through the years, there has been no one in this House that has been a 
more stalwart proponent of opening markets abroad and in the U.S. to 
trade, and I think that his leadership has done a great deal to improve 
the lives of Americans. So I congratulate him on bringing this 
agreement to the floor.
  I do rise in strong support of this agreement with Australia. I think 
it is worth noting that this is the first free trade agreement we have 
had with an industrialized nation in 17 years. It is an important trade 
agreement. It is one that demonstrates how U.S. leadership in 
international economic policy is continuing to expand free trade on a 
worldwide basis.
  The amount of trade between the United States and Australia is 
substantial--$29 billion--which makes it the ninth largest trading 
partner of the United States: $19 billion of that amount reflects trade 
in agricultural and industrial production, and $9 billion, the fastest 
growing part, is the trade in services. Our exports to Australia 
include transportation equipment, notably aircraft and engine parts, 
telecommunications equipment, measuring instruments, internal 
combustion engines, and computers and all the components that go into 
those computers.
  Mr. Speaker, I urge my colleagues to support this agreement. It is an 
agreement that is critically important for consumers here, for our 
families, and for workers here in the United States. Free trade with 
Australia helps to keep inflation rates low. It provides opportunities 
for a better quality of life for the U.S. worker and families through 
lower prices of imported goods.
  We are pursuing this agreement in our national economic interests. 
But, without doubt, it also serves our national security and our 
foreign policy interests as well.

[[Page H5712]]

  Let us make no mistake about it, and the gentlewoman from Ohio 
alluded to this: Australia has been a friend; it has been an ally in 
this war against terrorism. In the aftermath of the September 11 
terrorist attacks, this ally has provided some 1,550 soldiers and 
military equipment to support the U.S.-led coalition to combat 
terrorism. Australia has contributed generously to the coalition effort 
to disarm Iraq by sending to Iraq fighter jets, transport aircraft and 
ships, reconnaissance forces, and dive team members.
  So I want to commend Ambassador Zoellick and the team at USTR and the 
administration for successfully negotiating what I think is an 
important free trade agreement. It is not perfect. Members like myself 
would have wished to have increased market access for Australian 
exports of sugar. But, nonetheless, this is a good agreement and a 
significant accomplishment, and I urge my fellow Members to vote 
``yes'' on this agreement.
  Mr. LEVIN. Mr. Speaker, I yield myself 9 minutes.
  Mr. Speaker, I want to mention right at the beginning that the 
gentleman from New York (Mr. Rangel) wished to be here. We share a very 
similar approach to this issue. But he had to leave to go to New York 
for a funeral, so he could not be with us.
  This administration's economic policy, in a few words, has been a 
miserable failure. I have joined with others in opposing key parts of 
their approach to trade. I helped lead the fight against their Trade 
Promotion Authority and for our own alternative, and we have helped to 
point out time after time their lackluster record on enforcement.
  In a word, we have opposed the administration for using a one-size-
fits-all, a blind, a cookie-cutter approach to trade policy. I do not 
think it works for us to respond with our own cookie-cutter approach to 
trade.
  So we have before us a specific agreement. It has some very 
important, positive features to it. For manufacturing, right now, 93 
percent of the total value of goods that we send over to Australia are 
in manufacturing, and duties on more than 99 percent on these goods 
will be eliminated. This has real implications for autos and auto 
parts, for construction equipment, for electrical equipment, for 
appliances, for furniture, for information technology, for medical and 
scientific equipment. Also, there are important provisions here for 
agriculture. Australia will eliminate immediately all of their tariffs 
on food and on agriculture.
  Let me say, though, despite these provisions, and there are some 
important provisions regarding services, I would vote against this bill 
if I thought it either undermined our position, our efforts, our 
commitment on core labor standards, or our firm commitment on the 
reimportation of drugs.
  As to labor standards, Australia uses the standard ``enforce your own 
laws.'' That can work for countries that have solid laws that meet ILO 
standards and enforce them. That was the standard, ``enforce your own 
laws,'' in Jordan; and it worked because those standards are in their 
laws and they enforce them. It is the case in Australia.
  I think the best approach is to say what will work for Australia will 
not work for nations with very different conditions. We will never 
agree to one-size-fits-all, to a blind application of provisions; and 
that is clearly true in terms of labor standards in Central American 
nations.
  We on this side overwhelmingly, and I hope the same is true of many 
over there, will not vote for a CAFTA with a standard that would ratify 
very unsatisfactory conditions for their workers, for their nations, 
for our workers and our Nation, and can only lead to a race to the 
bottom.
  As to prescription medicines, we were very concerned about this 
issue. A number of us, led by the leader, the gentlewoman from 
California (Ms. Pelosi), the gentleman from New York (Mr. Rangel), the 
gentleman from Maryland (Mr. Hoyer), the gentleman from California (Mr. 
Stark), the gentleman from California (Mr. Matsui), and others, as I 
look at the letter, opened up this question with our USTR in our letter 
of January 15.
  Here is what we said: ``We are writing as members of the Democratic 
leadership of the House and senior members of the Committee on Ways and 
Means to express serious concerns about the administration's effort to 
modify Australia's National Pharmaceutical Reimbursement Program as 
part of the negotiations of a free trade agreement with Australia.''
  We said in conclusion, ``Given these concerns, we urge you,'' this 
was a letter to the President, to the USTR, to Mr. Zoellick, ``to 
withdraw the proposal that would, in essence, interfere with their 
structure and would replace it with one that is derived after a 
meaningful dialogue with Congress.''
  Australia resisted this effort by USTR. We supported Australia's 
resistance. That approach was, in essence, withdrawn; and it is not in 
this agreement.
  Then as to prescription medicines, there is the issue of whether it 
forces changes in the law of Australia. We asked the ambassador from 
Australia to tell it straight, and here is what he said. We wrote it 
down. It reiterated today what he said earlier: ``In neither case with 
respect to listing or pricing decisions will we be changing Australian 
legislation. We are not changing the methodology for evaluating the 
effectiveness and the pricing of drugs. We are making changes to the 
process to allow greater consultation and transparency, to make the 
process more timely and to allow an independent review of the decision 
by the Pharmaceutical Benefits Advisory Committee. The final decision 
to list a drug, including the price, remains with the Minister for 
Health. Let me also refer briefly to the issue of whether it will force 
any other changes, and I think the answer is basically no.
  Mr. Speaker, let me address the issue of reimportation for just a 
minute.

                              {time}  1630

  Australian law, as has been mentioned, prohibits the export of any 
drug that is subsidized by their system. That is 90 percent of their 
drugs. What was placed in this FTA was the laws of this country that 
relate to patents, including pharmaceutical drugs, but all other 
patents. I think it was a mistake to include it in this FTA. However, 
it has no practical effect in terms of reimportation because of the 
Australian system and their prohibition on the export of any drug that 
is subsidized. They do not want their subsidization to benefit us here 
in the United States.
  So if we follow the principle that we will look at each agreement on 
its own, if we follow that principle, I think we will then approve 
Australia, we will approve this FTA, but we will make it very clear 
that if that provision is placed in another FTA where the conditions 
are very different and it could affect, practically speaking, 
reimportation of drugs to the U.S., we will do the same vis-a-vis such 
effort as we are going to do as to CAFTA, strongly oppose it, because 
we do not want provisions in one agreement placed in another where the 
conditions are very, very different and where there would be injury to 
the interests of the United States.
  So, in a word, I do think, because of the positive provisions in this 
FTA relating to manufacturing, agriculture services, that we should 
approve this agreement. However, in doing so, it has to be absolutely 
clear: Do not use the standard as to core labor standards elsewhere 
where the conditions are different, and do not dare for a minute use 
this in any fair trade agreement which would actually inhibit our 
changes in law on reimportation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CRANE. Mr. Speaker, I yield 2 minutes to our distinguished 
colleague, the gentleman from California (Mr. Rohrabacher).
  Mr. ROHRABACHER. Mr. Speaker, I rise in support of this agreement.
  Over the years, Australia has been a terrific friend of the United 
States of America in every way. Over the years, I have restated my 
commitment to free trade between free people, and I can think of no 
better example of two free nations establishing open commerce between 
themselves than this suggestion that we have free trade with the people 
of Australia.
  Moreover, Australia has been a stalwart ally in the war on terror, 
and they have been with us all the way when much of the rest of the 
world was against us.
  Unfortunately, the authors of this bill decided to construct it in a 
fashion that will restrict the right of the

[[Page H5713]]

American people to purchase reimported, American-made prescription 
drugs in this bill and in future trade agreements.
  Well, I happen to be a strong supporter of America's access to 
reimported, American-made prescription drugs, but I am also supportive 
of free trade between free people, and I am also a grateful American 
for the friendship that has been shown us and demonstrated by the 
people of Australia. I would like to express my frustration with the 
administration and with our leadership for making what would have been 
an effortless vote on my part into a much more difficult decision. They 
cannot count on me in the future for votes on free trade agreements 
that include this provision.
  But, in terms of this vote today, we owe it to our Australian 
friends. They have been with us through thick and thin, and this vote 
today and this free trade agreement is our way of saying to our 
Australian friends, thanks, mates.
  Mr. BROWN of Ohio. Mr. Speaker, I continue to reserve my time 
waiting, I believe, for the gentleman from Illinois (Mr. Crane) to 
close if he would like.
  Mr. CRANE. Mr. Speaker, I yield 10 minutes to our distinguished 
colleague, the gentleman from California (Mr. Dreier), the chairman of 
the Committee on Rules.
  (Mr. DREIER asked and was given permission to revise and extend his 
remarks.)
  Mr. DREIER. Mr. Speaker, I rise in strong support of this 
legislation.
  I would like to take a few minutes to first follow up on the 
discussion that we had at the opening of the rules debate this morning 
on the House floor.
  One of our colleagues, I do not remember exactly who it was, I think 
it may have been my friend, the gentleman from Michigan (Mr. Levin), 
talked about the fact that there had been no consultation on the issue 
of this pharmaceutical drug reimportation issue; and I said at the time 
that I was going to get some information on the consultative process 
which took place as it relates to the free trade agreement, and it does 
include a great deal of discussion on the issue of the pharmaceutical 
question.
  The administration, as I said this morning, held extensive, extensive 
consultations with Congress on the Australia Free Trade Agreement. 
There were, in fact, 29 briefings that were held with the Committee on 
the Judiciary and members of the Committee on Ways and Means on the 
FTA. There were actually eight briefings that were held specifically on 
the pharmaceutical question in a bipartisan way, and they related 
directly to the intellectual property rights issue, which is an 
important question.
  So this argument that somehow there was no consultation with the 
Congress on the issue of the pharmaceutical question is a specious one. 
Actually, Members and staff who have clearances received the text on 
the intellectual property rights issue, which included patent 
provisions, in March of 2003, 16 months ago. So I think it is important 
for us to note that there has been an important process that took 
place.
  My good friend and fellow Californian (Mr. Rohrabacher) was just here 
in the well, and I know that there has been, again, some confusion on 
this issue of whether or not the free trade agreement itself somehow 
includes a provision that would prevent the United States Congress from 
dealing with the reimportation issue. I will say right now what I said 
this morning when we were debating the rule: There is absolutely 
nothing whatsoever in this legislation that regards the issue of drug 
reimportation.
  What I would like to do is say that the free trade agreement has 
nothing in it, the implementing language has nothing in it at all. Any 
law that the United States Congress passes always will trump the free 
trade agreement. So the very important thing that we need to realize is 
that our Constitution grants us that authority. So the patent provision 
in the free trade agreement restates U.S. law and applies to all 
patents, not just pharmaceuticals. Not including this provision would 
be devastating to the U.S. intellectual property rights holders in 
every sector of our economy, including pharmaceuticals.
  I know my friend, the gentleman from California (Mr. Rohrabacher), is 
a great screenwriter. It would include, obviously, intellectual 
property when it comes to our very important entertainment industry as 
well.
  Australian law states, already states that there is a ban on the 
exportation of drugs dispensed under the PBS, the Pharmaceutical 
Benefits Scheme that exists. Unlike Canada, Australian law explicitly 
prohibits other parties such as a wholesaler or a pharmacist from 
exporting nonPBS-dispensed drugs. That is Australian law. It has 
nothing whatsoever to do with the free trade agreement itself.
  So I think we need, and I am happy that my friend is going to be 
supportive of this legislation and was going to be supportive earlier, 
but now what I want him to know is that he can be an even greater 
enthusiast in support of this now that we realize that there is nothing 
in this free trade agreement that deals with the issue of drug 
reimportation.
  Now, let me just make a couple of comments on some things that had 
troubled me.
  First, and this does not trouble me at all, it is simply praise for 
the gentleman from Illinois (Mr. Crane), the chairman of the 
Subcommittee on Trade. He educated me and a lot of others over the 
years on the importance of trade liberalization. Trade liberalization, 
breaking down barriers, does enhance opportunities for the free flow of 
goods, services, and capital and how that improves the quality of life 
worldwide. I learned so much of that from the gentleman from Illinois 
(Mr. Crane). He has been a great teacher on it.
  The thing that has concerned me about this debate today is that some 
are trying to use the U.S.-Australia free trade agreement as an 
argument in opposition to other agreements. It is true that with 
Australia we have a very similar economy, and that is something that is 
important for us to recognize. It is also true, as my friend, the 
gentleman from California (Mr. Rohrabacher), and others have said, and 
I said when I was standing here this morning, that the alliance between 
Australia and the United States of America is an extraordinarily 
important one.

  Prime Minister Howard was here on September 11 of 2001. He was going 
to be addressing a joint session of Congress, and he was here when 
President Bush addressed the Congress, and he stood with us 
consistently. In fact, he actually has used this term, he describes 
Australia as the sheriff for the United States of America. And it does 
underscore the importance of this agreement, how it will go even 
further in strengthening this critically important tie.
  But as we look at the Australia agreement, how we can all of a sudden 
say the trade liberalization with countries that are trying to claw 
themselves onto the first rung of the economic ladder, how we did 
oppose those based on the fact that we have one structure with the 
U.S.-Australia agreement, is to me something that is very, very 
troubling.
  I happen to be a strong proponent of the Central American Free Trade 
Agreement. I believe that it is critical for us, as the trade 
ministers, all the trade ministers said to me upstairs in the Committee 
on Rules just several weeks ago from five Central American countries, 
that to lock in democracy in Central America, to make sure that we 
improve the standard of living for the people of Central America, we 
must have the Central American Free Trade Agreement.
  Now, many of us were in Seattle. I know I was there with my friend, 
the gentleman from Michigan (Mr. Levin), in December of 1999, the first 
week of December, 1999. We all know how that meeting fell apart. And I 
will never forget the cover of The Economist magazine, that great 
publication which, for a century and a half, has focused on the issue 
of trade liberalization as its priority. The cover of that magazine the 
week after the ministerial meeting broke down in Seattle had a picture 
of a starving baby in Bangladesh with the caption: ``Who was the real 
loser in Seattle?''
  The reason is that it is important for us, if we are committed to 
making sure that these developing nations do, in fact, have an 
opportunity to succeed and, as I said, get onto the first rung of

[[Page H5714]]

the economic ladder, we need to work on trade liberalization with them. 
We need to help them find new opportunities to participate in the 
global economy. So that is why this is a very good agreement; and, 
similarly, other free trade agreements that we are going to be putting 
together that will break down barriers and encourage that free flow of 
goods and services and capital is something that we absolutely must 
continue with.
  So, yes, we are going to have strong bipartisan support for this 
measure, but equally important and, in some ways, maybe even more 
important, Mr. Speaker, we need to have strong bipartisan support when 
it comes to these further agreements. Why? Because there are countries 
in this hemisphere and in other parts of the world that would love to 
have economies like Australia's or like the United States of America, 
and I happen to believe that the only way that we are going to create 
an opportunity for them to enjoy the wonderful standard of living that 
exists in both Australia and the United States of America is for us to 
have them enjoy the opportunity to participate in our global economy.

                              {time}  1645

  So I herald my colleagues who are going to be supporting this. I hope 
that everyone plays a role in understanding that this is part of our 
being on the cutting edge of the 21st century global economy. I 
congratulate President Bush for the leadership that he and Ambassador 
Zoellick have provided on this issue and my colleagues on both sides of 
the aisle for doing it. I look forward to a very, very strong vote in 
just a few minutes.
  Mr. Speaker, I yield back the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Texas (Ms. Jackson-Lee).
  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Mr. Speaker, this is a short time to talk 
about a trade bill, but I thank the distinguished gentleman from 
Michigan for his hard work, all of the Members that are on the floor.
  Let me speak very quickly. I look forward to a Congress, hopefully 
Democratic-controlled, that will have the kind of oversight that will 
allow us to write the trade bills that answer all of the concerns of 
Americans, but let me just say this. The work that has been done on 
this bill leads me to believe that we can at least get started in 
support of this legislation.
  One, I am sure that the indigenous population in Australia is one 
that is going to be addressed, that they are looking to enhance their 
educational opportunities, and I am going to be monitoring it myself. I 
do believe that it is important to state that the present status of 
reimportation is not precedent; and even if we vote on this 
legislation, it will not be used against us in the whole concept of 
providing cheaper drugs for Americans.
  I am very glad to say that there are no immigration provisions on 
there, because no treaty should allow back-door immigration policies 
like the Chilean trade bill and the Singapore trade bill.
  And then I would say although it is not perfect, and I want to say to 
my labor friends, you are absolutely right, and when we get the kind of 
Congress that ensures that we have strong labor laws, we will be able 
to write these good bills; but I am glad to say that Australia does 
have its own worker-protection legislation. With that, I would say that 
this bill provides us an opportunity to make a positive statement, and 
in Texas we have got $749 million in trade in Texas.
  Mr. Speaker, I rise in support of the U.S.-Australia Free Trade 
Agreement, H.R. 4759 because of the economic benefits that it will 
bring for both signatories of the agreement. During insecure economic 
times it is vital that we give free trade agreements such as this close 
scrutiny. While I have certain reservations about this Agreement, 
specifically the fact that workers rights protections are not as 
extensive as those given for intellectual property, I am giving my 
support to Australian Free Trade Agreement in the hopes that more 
Americans jobs can be created as a result.
  My support for this bill of implementation goes with the hope that it 
will not bring with it some of the negative implications that the Chile 
and Singapore agreements brought. I voted against the U.S.-Chile Free 
Trade Agreement, H.R. 2738 and the U.S.-Singapore Free Trade Agreement, 
H.R. 2739 in July of last year partially based on the impacts that will 
be made on employment in the United States.
  My support for the Australian Free Trade Agreement is largely based 
on the fact that there are no back-door immigration provisions included 
in the bill. The Chile and Singapore agreements however, will create a 
new class of temporary entry visa for ``professional'' workers. As 
Ranking Member of the House Judiciary Subcommittee on Immigration and 
Claims, this substantial change to the current immigration laws 
concerns me. Certain classes of workers--some 5,400 Singaporean and 
1,800 Chilean immigrants would be eligible for this visa which would be 
indefinitely renewable. The H1-B rules that limit the duration and 
renewability needed to be applied to these agreements in order to 
preserve the consistency of our immigration policy. Additionally it is 
important to note that Texas does over $740 million dollars in export 
business with Australia thereby creating JOBS in Texas!
  I also found the lack of parity between the enforcement of labor laws 
in the U.S. and in Chile and Singapore to be troubling because it would 
leave our workers vulnerable to harsh and inhumane labor standards.
  Fast Track legislation has not required the president to include 
enforceable protections for the environment and workers' rights in our 
trade agreements, lacks adequate procedures for consultation with 
Congress and the public, harms independent farmers and limits 
democratic debate about trade policy.
  The U.S.-Australia FTA is between industrialized nations; two 
countries with many similarities in terms of their stage of economic 
development. This is true of the important manufacturing sector, and 
therefore the reductions in tariff levels should provide many mutual 
benefits. Australia has also made important commitments in the area of 
copyright and trademark protections which will safeguard digital 
content and promote Internet technologies.
  In the area of internationally-recognized core labor standards, the 
FTA adopts a standard for each nation to effectively enforce its own 
laws. While I do not support this model, I believe the structures in 
Australia, and importantly, the history and experience in this area, 
including a substantial percentage of Australian workers in unions and 
covered by collective bargaining agreements, are strong enough to 
ensure fair competition and a substantial middle class for the benefit 
of Australia and as a market for U.S. goods and services.
  History has invariable shown that the status of internationally-
recognized labor standards is a critical factor in a nation's economic 
development, in the spread of benefits to a broad spectrum of its 
citizens and in reducing serious income disparities which is essential 
to the development of a middle class.
  Unfortunately, the Administration continues to pursue trade 
agreements with countries in very different stages of economic 
development than ours using the same model for labor standards. Their 
one-size-fits-all approach to trade agreements generally, and labor 
standards specifically, is driven by their outdated view that more 
trade is always better, no matter the terms and content of the trade, 
ignoring the stark realities of globalization.
  As long as the Bush Administration continues to ignore these 
realities, they will find success only in smaller agreements such as 
Australia and continue to fail U.S. workers and businesses in the 
larger or more difficult FTAs (i.e., CAFTA, FTAA), in the multi-lateral 
World Trade Organization (WTO) negotiations, and in addressing the 
skyrocketing trade deficit with China.
  Lastly, I want to make it very, very clear, the prohibition of the 
reimportation of prescription drugs is not supported by my vote--and 
should not be taken as support for this precedent!
  Mr. CRANE. Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield myself \1/2\ minute.
  Two quick comments. The gentleman from California (Mr. Dreier) says 
that U.S. law will always trump a trade agreement, but it could create 
a violation of the trade agreement. In this case a violation is 
theoretical, but do not try the approach in a very different case.
  Secondly, to the gentleman from California (Mr. Dreier), a race to 
the bottom does not help the people in developing nations or this 
Nation. That is why we want different agreements for different 
situations.
  Mr. DREIER. Mr. Speaker, will the gentleman yield?
  The SPEAKER pro tempore (Mr. Hastings of Washington). The time of the 
gentleman from Michigan (Mr. Levin) has expired.
  Mr. CRANE. Mr. Speaker, I yield such time as he may consume to the

[[Page H5715]]

gentleman from California (Mr. Dreier).
  Mr. DREIER. Mr. Speaker, I thank my friend for yielding me the time, 
and I would simply say that we all want to ensure that we do not see an 
engagement in the race to the bottom. That is not a goal that we have 
at all. What we want to do is we want to have in place policies, and 
the so-called race-to-the-bottom argument is one which was used as we 
were looking at the passage of fast track several years ago.
  Mr. LEVIN. Mr. Speaker, will the gentleman yield?
  Mr. DREIER. I yield to the gentleman from Michigan.
  Mr. LEVIN. Mr. Speaker, I would say to the gentleman from California 
(Mr. Dreier) enforcing your own laws in a situation where the laws are 
inferior and unenforced will lead to a race to the bottom.
  Mr. DREIER. Mr. Speaker, reclaiming my time, let me say that we all 
want to do everything that we can to ensure that we do not engage in a 
race to the bottom. What we want to do is we want to make sure that we 
engage in a race to the top; and to get to the top, there are many 
countries that today may not be able to comply with every single 
standard that developed nations like Australia and the United States of 
America enjoy, and it is for that reason that we need to ensure and 
recognize that the best way for them to be able to qualify for that 
status is to see the economies of those countries grow.
  Mr. BROWN of Ohio. Mr. Speaker, I yield myself my final 2 minutes.
  Mr. Speaker, I enjoy hearing the gentleman from California (Mr. 
Dreier) talk about a world of trade that never quite ends up the way 
that we promise in this institution.
  For 3 years in this Congress with this President, we have turned our 
government over to special interest groups. The Medicare bill was 
written by the insurance industry, the drug industry. Social security 
privatization legislation was written by Wall Street. Energy 
legislation has been written by Enron and Halliburton. Environmental 
legislation has been drafted by the chemical companies. And now trade 
legislation again has been written, in these provisions that we have 
talked about, by the drug companies.
  If you think that the prescription drug industry has too much 
influence in this Congress, if you think the prescription drug industry 
has too much influence on the Medicare bill, too much influence with 
FDA, too much influence on trade policy, then vote ``no'' on this U.S.-
Australia FTA.
  If you do not trust the Bush administration to stand up to the drug 
companies and you do not trust the Bush administration to work for 
lower prices, then vote ``no'' on this U.S.-Australia FTA. If you care 
about reimportation and close to 300 Members on both sides of the 
aisle, 300 Members of this body do care about reimportation, if you in 
fact do, then vote ``no'' on U.S.-Australia FTA.
  And if you want to send a message to this Congress, if you want to 
send a message to the President and to the USTR that we should not 
allow the drug industry to write trade law in this country, then vote 
``no.''
  Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
  I would like to just reiterate in closing that this is an important 
agreement, and Australia is a close ally and friend of the United 
States. As the Australian Trade Minister Mark Vaile has said, this FTA 
is the commercial equivalent of the ANZUS treaty on security issues 
signed in 1951. This agreement represents the best FTA ever negotiated 
regarding industrial products, over 99 percent of which will become 
duty free immediately. And it is estimated that U.S. exports to 
Australia support more than 150,000 jobs currently. And in addition, 
Australian farms in the U.S. employ over 85,000 Americans. The U.S. 
already enjoys a $9 billion trade surplus with Australia, and this 
agreement is clearly in our national interest; and I strongly urge my 
colleagues to support this agreement. Vote ``yes'' on H.R. 4759.
  Ms. McCARTHY of Missouri. Mr. Speaker, I rise in support of the 
Australia Free Trade Agreement but also to express reservations about 
the precedent it may set for future trade agreements. Australia has 
been a strong ally for decades and it is appropriate that the United 
States enjoy an open and fruitful trading relationship with Australia. 
Locally, this trade agreement will give a strong boost to trade and 
investments. My state of Missouri sent $137 million dollars worth of 
goods and services in 2003 to Australia, an increase of 9 percent over 
the previous year, in a variety of sectors. For example, chemical 
manufacturers export $46.4 million worth of goods to Australia and 
machinery manufacturers send $28.1 million worth of their products to 
the Australian market.
  This trade agreement has received strong support from a variety of 
interests. The agreement contains many positive provisions such as 
strong protections for copyright owners and it provides exporters with 
a sound legal environment for the export of goods to the United States. 
Our country enjoys a trade surplus with Australia and has a long 
standing economic relationship with the United States that this 
agreement will continue. Passage of this agreement is a positive step 
for our relationship with one of our closest allies.
  Mr. KENNEDY of Rhode Island. Mr. Speaker, I would like to commend the 
hard work and leadership of the Chairman and Ranking Member in 
producing this Australian Free Trade Agreement.
  It is a credit to the diligence and dedication of the Australian 
government that this complex Free Trade Agreement was completed in 
under a year.
  That is why I'm hopeful that the Australian government will employ 
that same diligence and dedication in resolving a dispute over maritime 
boundaries with its neighbor, East Timor.
  Fifty-three of my colleagues have already joined in supporting East 
Timor's call for a fair and expeditious resolution to this dispute.
  These disputed boundaries are a reminder of the invalid agreements 
made between Indonesia and Australia during the Indonesian military 
occupation of East Timor.
  The East Timorese struggle for independence will not be complete 
until East Timor, a fully sovereign country, no longer has to bear that 
lingering reminder of subjugation.
  To be sure, there is tremendous enormous financial benefit dependent 
upon how these maritime boundaries are drawn.
  Rich with oil and natural gas reserves, these critical areas are an 
economic resource for a struggling country of very little economic 
activity.
  A country struggling with high maternal mortality, widespread malaria 
and tuberculosis, rampant poverty, and desperately needed education.
  The Australian government was a leader in assisting East Timor's 
transition to democracy. It provided peacekeepers and foreign aid. But 
since 1999, Australia has acquired an average of $1 million a day in 
petroleum from the disputed areas, exceeding the amount of assistance 
it provided to East Timor.
  The Free Trade Agreement today between our two countries are a mark 
of respect we have for each other. A fair and equitable resolution of 
this boundary dispute with East Timor honors Australia's leadership and 
commitment to fostering a strong and enduring democracy.
  As a friend of Australia, I respectfully urge its government to 
rejoin the international dispute resolution mechanisms and 
expeditiously negotiate a permanent maritime boundary in the Timor Sea 
in good faith, according to the established principles of international 
law.
  Mr. BOEHNER. Mr. Speaker, I rise in strong support of this measure, 
which demonstrates, once again, the unmatched value of trade 
liberalization and the shared benefits of free trade agreements.
  Over the last year, many of my colleagues here in the House have 
sought to address the plight of domestic manufacturers who have trimmed 
payrolls as they adapt to a new economy driven by the productivity 
gains of new technology. In the quest for political points trade has 
been wrongfully vilified and talk has centered on erecting new barriers 
to trade. Today members have an opportunity to set aside this 
counterproductive rhetoric and put into action a manufacturing trade 
agreement--an agreement that will benefit all sectors of our economy.
  Two-way trade between the two countries exceeds $25 billion and the 
U.S. enjoys a $6 billion dollar trade surplus. More importantly, upon 
entry into force, 99 percent of exported U.S. manufactured goods to 
Australia will become duty-free. Manufactured goods now account for 
nearly 93 percent of U.S. exports to Australia. For automakers, a 
cornerstone industry for Ohio, this agreement will sweeten an export 
market that is already dominated by U.S. cars and light trucks and 
presents an opportunity for even more growth.
  Lower tariffs on American goods will mean job creation, job security, 
and money in the pockets of America's workforce. Last year Ohio joined 
Washington, California, Illinois, Texas, Michigan, Pennsylvania, 
Kentucky, New York and Florida in the top 10 of exporting states to 
Australia. For my colleagues looking for even more reasons to vote in 
support of this agreement, you will discover some 19,000 companies that 
export to Australia

[[Page H5716]]

waiting for the opportunity to grow their business through lower 
tariffs and the removal of non-tariff trade barriers.
  Those who search for any reason to be anti-trade are at a loss with 
this agreement because Australia maintains some of the highest labor 
standards and wage rates in the world. Sensitive agriculture products 
such as dairy and beef are protected with permanent safeguards and 
microscopic increases in tariff rate quotas. One commodity, sugar, is 
entirely exempted from the agreement. In short, those looking for 
reasons to oppose won't be able to find any.
  Mr. Speaker, the U.S.-Australia Free Trade Agreement gives members 
that are concerned about job creation and manufacturing a chance to 
match their rhetoric with their vote. I urge members to support this 
agreement and vote yes.
  Mr. BACA. Mr. Speaker, I rise in opposition to this free trade 
agreement.
  A free trade agreement with Australia is a one-way street going in 
the wrong direction for U.S. jobs.
  I am not opposed to free trade, but support it only when I believe 
the gains outweigh the losses.
  Each year, Australia imports only 338 million dollars of American 
agriculture. Meanwhile, the United States imports about 2 billion 
dollars of agriculture from Australia.
  Most of these imports, especially wine, milk, and wool, will hurt 
California's agriculture economy.
  Competition is good for business, but only when all teams are playing 
by the same rules.
  Over the past decade, exports of U.S. specialty crops have remained 
flat because of trade barriers and subsidized competition in many 
foreign countries.
  Unfortunately, the Uruguay Round and other trade agreements have not 
provided the access to foreign markets that U.S. specialty crops were 
promised.
  We need to remove these barriers before we sign new FTAs, and even 
then we should only sign those agreements that will result in 
beneficial trade for the United States--more exports than import.
  I am especially concerned about FTAs with countries that export milk 
protein concentrates, which are used for the illegal substitution of 
milk in cheese. This robs our children of nutrition in the name of 
profit.
  Warning Mr. and Mrs. America, one cup of milk in every slice is 
actually one cup of MPC in every slice.
  As a representative of California, our Nation's beacon of 
agriculture, I have to think about jobs and the rural economy as much 
as lower prices at the consumer end.
  We need to choose between buying moderately priced, high-quality 
products grown in the United States, or saving at the checkout counter 
on lower-quality foreign goods at the cost of sending our jobs abroad.
  Will the millions of Americans who have lost their jobs to trade feel 
that it was worth it when they save a few dollars at the grocery store?
  I don't think they will.
  Mr. Speaker, I urge my colleagues to oppose the Australian Free Trade 
Agreement and other FTAs until the administration can focus on economic 
policies that protect American jobs.
  Ms. BALDWIN. Mr. Speaker, I rise in opposition to this legislation. 
The Australian Free Trade Agreement has been crafted in a way that 
repeats the flaws and weaknesses of previous agreements such as NAFTA. 
However, this agreement is particularly bad for Wisconsin dairy farmers 
and Wisconsin seniors.
  This agreement puts Wisconsin dairy producers at a disadvantage. It 
reduces and ultimately eliminates tariffs on a variety of Australian 
dairy products, including cheese, which is what most Wisconsin milk is 
used to produce. While the agreement does eliminate tariffs on U.S. 
dairy exports to Australia, this will not provide significant new 
export markets for American dairy producers. The Australian dairy 
industry is mature and stable, and Australia is a net exporter of dairy 
goods--they already export more than they import.
  Another serious concern I have is how the agreement treats 
importation of Milk Protein Concentrate (MPC). MPC has been entering 
our country at an increasing rate since the mid-1990s. One of the 
biggest exporters of MPC is Australia. MPC can be imported in the U.S. 
under a very low tariff rate. This makes it an inexpensive substitute 
for domestically produced milk in American cheese vats and other dairy 
products. Simply put, MPC takes the place of U.S. milk in a variety of 
products, thereby reducing the demand for domestic milk, and lowering 
the price Wisconsin dairy producers receive for their high-quality 
product. Unfortunately, the agreement did not close the MPC import 
loophole--the tariff on MPC remains artificially low, and so imports of 
MPC will continue to displace U.S. milk in the domestic production of 
dairy products.
  Further, I have serious concerns about provisions included in the 
agreement that relate to prescription drugs. The agreement allows 
pharmaceutical companies to prevent the importation of drugs to the 
United States. While this will have a very small practical impact on 
the importation of prescription drugs from Australia, it does hamper 
efforts of this Congress to provide our Nation's seniors with access to 
affordable prescription drugs. We simply cannot stand idly by while 
American seniors pay 30 percent-300 percent more for the exact same 
prescription drugs available in other countries. Allowing drug 
companies to prevent the importation of prescription drugs from 
Australia sets a dangerous precedent for future trade agreements. We 
should be expanding seniors' access to affordable drugs, not limiting 
it.
  In addition, this agreement allows drug companies to challenge 
decisions made by Australia about what drugs should be covered under 
that country's health plan. This marks the first time that the United 
States has challenged how a foreign industrialized nation operates its 
national health program to provide inexpensive drugs to its own 
citizens. Instead of interfering with the Australian health program, we 
should learn from it. While our seniors continue to pay exorbitant 
prices for prescription drugs and lack comprehensive, reliable 
prescription drug coverage, Australia has developed a program that 
guarantees its citizens coverage for affordable prescription drugs. We 
should not be hampering their success.
  Mr. ALLEN. Mr. Speaker, I rise in support of the U.S.-Australia Free 
Trade Agreement, but with strong reservations about the pharmaceutical 
provisions.
  Australia is the 12th largest foreign market for the State of Maine. 
The State exported $29 million in goods and services to Australia last 
year. That amount will likely grow with this agreement, which 
eliminates 99 percent of all tariffs on manufactured goods, including 
on paper and wood products, and reduces barriers to Maine agricultural 
and services exporters.
  Since Australia is a developed country with strong labor and 
environmental laws, this FTA does not involve a significant debate over 
the need to promote effective labor and environmental standards through 
trade agreements.
  On balance, the agreement will benefit consumers and businesses in 
both countries by lowering barriers to trade in goods and services. 
However, the administration has included provisions, sought by the drug 
industry, that raise barriers to free trade in pharmaceuticals. This 
represents the first trade agreement to force changes in a trading 
partner's health regulations.
  Australia is the first country to implement a comprehensive system 
that evaluates the comparative effectiveness and cost effectiveness of 
drugs. Under their innovative Pharmaceutical Benefits Scheme, PBS, the 
reimbursement rate for pharmaceuticals is based on the therapeutic 
value of a drug, rather than on the price that the manufacturer wants 
to charge. The system allows for higher reimbursements for truly 
innovative drugs. Pharmaceutical manufacturers are given ample 
opportunity to prove the value of their products, which results in a 
negotiation over the price at which the government will reimburse the 
manufacturer.
  The U.S. pharmaceutical industry dislikes the Australian system 
because it shifts decision-making power over drug prices from industry 
executives to doctors and health professionals. Consequently, the Bush 
administration signaled that it wanted to make changes to the PBS 
through the U.S.-Australian Free Trade Agreement.
  I am the sponsor, with Representative Jo Ann Emerson, of bipartisan 
legislation (H.R. 2356) to provide Federal funding for comparative 
effectiveness studies in the U.S. In October 2003, we sent a bipartisan 
letter to U.S. Trade Representative, USTR, Robert Zoellick expressing 
concerns that changes to the PBS could undermine our domestic efforts 
to promote comparative effectiveness. An exchange of letters followed.
  Last winter, USTR offered a proposal to the Australians which, 
reportedly, would have undermined the pricing structure of the PBS. 
Fortunately, following objections by Members of Congress, public health 
groups, and the Government of Australia, that onerous provision was not 
adopted.
  The pharmaceutical provisions that ultimately were included in the 
FTA were more limited, but not insignificant. My concerns are as 
follows:
  First, Article 17.9.4 grants a patent holder like a pharmaceutical 
company the right to block re-importation of its patented product into 
the U.S. by contract or other means. By contrast, S. 2328, the Dorgan-
McCain re-importation bill, contains provisions designed to prevent 
drug companies from restricting the ability of pharmacists or 
wholesalers to import drugs from approved countries (the bill lists 
Australia). The Senate re-importation bill, if enacted, could thus be 
challenged as inconsistent with trade law. The U.S. could be found to 
be in violation of obligations under

[[Page H5717]]

the U.S.-Australia FTA, and subject to sanctions until the re-
importation law is repealed.
  However, Australian law already prohibits this practice. Thus, the 
provision is not necessary. So why is it here? To set a precedent.
  Deputy USTR Josette Shiner testified before the Senate Finance 
Committee on April 27 that the pharmaceutical provisions in the 
Australia FTA ``lay the groundwork for future FTAs,'' which will 
``steer us in ongoing and future global, regional and bilateral 
negotiations--including upcoming FTA negotiations and consultations 
with Canada and other major trading partners bilaterally and in 
international fora like the OECD.''
  The intent of the Bush Administration is clear. If the provision in 
this FTA were applied to trade relations with Canada (where re-export 
is legal), it would permit legal challenges, under trade law, to the 
re-importation bill that many of us favor as a source of affordable 
medicines for our constituents.
  Second, the FTA opens up our Medicare program for potential changes, 
a fact acknowledged by USTR. Annex 2-C of the FTA imposes transparency 
obligations not only on Australia's PBS, but also on the pharmaceutical 
reimbursement policies of the Medicare Part B program. While USTR 
claims that these obligations do not require changes in U.S. law or 
regulation, it does set a worrisome precedent for modifying domestic 
health policies through trade agreements, where Congress has less say 
and the pharmaceutical industry has more influence.
  Third, there are questions about whether the Australian FTA will 
affect the Department of Veterans Affairs' prescription drug benefit. 
An analysis by the Center for Policy Analysis on Trade and Health 
concludes that the Government Procurement Chapter of the U.S.-Australia 
FTA grants pharmaceutical companies standing to challenge VA 
procurement decisions, including decisions about the coverage and 
pricing of pharmaceuticals, as an unfair trade practice. USTR responds 
that the FTA imposes no new obligations on the VA beyond those already 
required by the World Trade Organization's Government Procurement 
Agreement. This question bears further investigation.

  I have met with USTR officials, and came away with the impression 
that they went to great lengths to ensure that the pharmaceutical 
provisions in the U.S.-Australia FTA did not force changes to current 
U.S. health law or regulation. Even with the limited provision in the 
FTA, which makes relatively minor changes to the Australian PBS, U.S. 
negotiators couldn't avoid subjecting our Medicare program to the 
Agreement's obligations. They treaded carefully, but still crossed the 
line.
  By the Administration's own admission, this FTA is part of a larger 
policy designed to dismantle so-called drug price control/reference 
pricing systems in other countries. Given the Australian experience, it 
is inconceivable that more aggressive pharmaceutical provisions in 
future FTAs won't have reciprocal, and likely adverse, effects on U.S. 
federal health programs.
  Basically, by the same definition that labels the Australian, 
Canadian or German systems as ``price controls,'' our VA and DOD drug 
programs are price controls. Those who would use trade policy to 
dismantle price controls overseas will endanger the prescription drug 
benefits we offer to American veterans and military personnel.
  Regardless of one's position on re-importation, the Australia FTA in 
general or the pharmaceutical provisions in particular, each of us 
should question whether it is appropriate to subject U.S. health laws 
to changes through trade negotiations. Under the Trade Promotion 
Authority procedure, Congress does not have the ability to amend an 
agreement once negotiated, and the principal House and Senate health 
policy committees are given little if any role.
  Lastly, I question whether it is appropriate to use trade policy to 
interfere in other nations' health systems. We certainly wouldn't 
accept such a demand from other countries. The United States will win 
no friends if our trade agenda becomes a heavy handed tool to raise 
drug prices on the citizens of our trading partners.
  The Bush Administration's excuse for not insisting on strong labor 
and environmental standards in trade agreements is that the U.S. has no 
business dictating other nations' labor and environmental laws. It is 
hypocritical for the Administration to take the opposite approach when 
it comes to health laws.
  Australians like their PBS and believe it is a balanced and 
scientifically sound way of assessing value for money for 
pharmaceuticals. Who are we to conclude otherwise? Australians can get 
any drug they want that is approved by their equivalent of the Food and 
Drug Administration. There is a viable private market for the few drugs 
not listed on the PBS. In my opinion, USTR's cited justification under 
the Trade Act for the pharmaceutical provisions is wrong. Australians 
are not denied full market access to U.S. drug products.
  The PBS section in the U.S.-Australian FTA has emerged as a major 
point of contention in Australia. Allegations that it will raise prices 
have forced a sensitive domestic political debate. This experience 
leads me to believe that a sure way for the Administration to slow down 
its trade agenda is to keep insisting on similar pharmaceutical 
provisions.
  To conclude, I support the Australian FTA. This agreement by itself 
will have little or no impact on U.S. health care laws. But I want to 
make clear that similar provisions must be kept out of future trade 
agreements.
  Mr. ETHERIDGE. Mr. Speaker, I rise today to announce my support for 
H.R. 4759, legislation implementing a free trade agreement with the 
nation of Australia.
  Australia represents the world's 15th largest economy and Asia's 
fourth largest, and therefore offers great opportunities for U.S. 
exports. Australia has consistently been a partner with the United 
States in pushing for more open and freer trade throughout the world. 
So it is only fitting to have a free trade agreement with nation that 
shares our beliefs in freedom and free markets.
  Under this FTA, more than 99 percent of U.S. manufactured goods will 
be duty-free from the first day of implementation. North Carolina 
exports to Australia in 2003, my state's 17th biggest export market, 
were valued at almost $262 million. From computer equipment to textiles 
to paper products to agriculture, North Carolina stands to gain much 
from increased access to this new market.
  I am particularly pleased about the benefits this agreement provides 
with respect to agriculture. All Australian agricultural tariffs will 
go to zero immediately, reducing costs for agricultural exporters by 
$400 million.
  Due to the hard work of the folks at USDA and USTR, Australia has 
agreed to limit some of its unscientific restrictions against U.S. pork 
exports. Consequently, the U.S. could ship $50 million worth of pork 
annually to Australia.
  Despite this progress, Australia must do a better job of eliminating 
its unscientific sanitary and phytosanitary restrictions on 
agricultural imports. I urge the Administration to keep the pressure on 
Australia to meet with USDA and USTR to resolve many of the outstanding 
sanitary issues affecting pork and poultry.
  This is an acceptable agreement for a nation as economically advanced 
and sophisticated as Australia. Its labor and environmental standards 
match if not exceed those in the United States. However, I want to make 
it perfectly clear to the Administration that the Australia Free Trade 
Agreement is not a sufficient model for future trade agreements.
  I support fair trade. However, on future FTAs, the Administration 
will need to do a better job with regard to market access, sanitary and 
phytosanitary issues, labor and environmental standards, and 
intellectual property protection. I look forward to continuing to work 
with the Administration and my colleagues in Congress on all of these 
important issues.
  I ask my colleagues to support this agreement.
  Mr. BEREUTER. Mr. Speaker, this Member rises today to express his 
support for the United States-Australia Free Trade Implementation Act 
(H.R. 4759). This Member would like to thank the distinguished 
gentleman from Texas, the Majority Leader of the House of 
Representatives (Mr. DeLay) for introducing this legislation. 
Additional appreciation is expressed to both the distinguished 
gentleman from California, the Chairman of the House Ways and Means 
Committee (Mr. Thomas) and the distinguished gentleman from California, 
the Chairman of the House Rules Committee (Mr. Dreier) for their 
successful efforts in helping move this legislation to the House Floor.
  This Member is very supportive of this free trade agreement, FTA, 
with Australia. To illustrate the importance of trade with Australia, 
this Member believes it is necessary to cite relevant statistics. Trade 
between the U.S. and Australia was over $28 billion in 2003. The U.S. 
currently enjoys a trade surplus in goods and services with Australia 
of $9 billion, which is the second largest with any U.S. trading 
partner. Moreover, in 2003, Australia ranked 14th among all foreign 
markets for U.S. If this FTA is enacted into law, our level of trade 
with Australia will significantly increase.
  This legislation is very important to Nebraska since our state's 
economy is very export dependent. For instance, Australia is the eighth 
largest market for Nebraska exports, with a total of over $62 million 
in 2003. Specifically, Nebraska exports to Australia include combine 
harvesters, agricultural spraying equipment, agricultural motor 
vehicles and motor boats. This legislation is critical to help remove 
existing trade barriers to exports of Nebraska goods and services to 
Australia. If this FTA would have been in place in 2003, nearly 95 
percent of Nebraska's exports would have been able to come into 
Australia duty free.
  This Member is supportive of this FTA with Australia for the 
following three reasons, among others: 1. this FTA will create jobs in

[[Page H5718]]

the U.S.; 2. this FTA will give greater market access for U.S. 
businesses and farmers; and 3. Through the twentieth century and in 
this one, Australia has been a consistent and highly valued and 
dependable ally of the United States.

  Mr. Speaker, in advancing the support of this Member for this FTA 
with Australia it should be noted that this FTA will create jobs in the 
U.S. It is estimated that currently 270,000 jobs are either directly or 
indirectly supported by U.S. trade with Australia. This number will 
increase significantly if this FTA is enacted into law. Specifically, 
the following industries nationwide will particularly benefit because 
of the FTA with Australia: aircraft and parts; telecommunications 
equipment, computers, and machine engines.
  With respect to Nebraska, it is estimated that exports to Australia 
already support approximately 300 jobs in Nebraska. It is important to 
note also that Australian-owned companies in Nebraska employ 
approximately 500 people. If this FTA is enacted into law, it is 
expected that trade with Australia will continue to support high-paying 
jobs in Nebraska in areas such as transportation, finance and 
advertising.
  Second, this FTA will give greater market access to Australian 
markets for U.S. businesses and farmers. To illustrate this point, it 
should be noted that almost 99 percent of U.S. manufactured exports to 
Australia immediately become duty free, which is estimated to result in 
an annual $2 billion increase in U.S. goods exports to Australia. Under 
this FTA, all Australian agricultural tariffs are to be eliminated 
immediately, which is to result in a projected $400 million benefit to 
U.S. farmers. Currently, Australia maintains tariffs as high as 30 
percent on certain dairy products and has tariffs of 4 to 5 percent on 
fresh and processed fruits, vegetables, processed foods, grains, 
oilseeds and other products. This FTA also contains important safeguard 
measures to protect against surges on Australian beef imports into the 
U.S.
  Third, Australia has been an important ally of the U.S. in facing 
threats to the U.S. and in mutual threats to our countries, including 
the current war against terrorism. Since the September 11th terrorist 
attacks, for example, Australia has provided 1,550 soldiers and 
extensive military equipment to support the U.S.-led coalition against 
terrorism. Furthermore, Australia has also contributed to the U.S. 
efforts in Iraq. As another example, it should be noted that Australia 
has contributed fighter jets, transport aircraft and ships, 
reconnaissance forces and dive-team members. In light of this military 
support for the United States, this Member believes that it is both 
fitting and in the best interest of the U.S. to continue to enhance its 
economic partnership with Australia.

  Mr. Speaker, in conclusion, this FTA with Australia provides 
tremendous opportunities for businesses and farmers across the United 
States, including in Nebraska. For the reasons stated above and many 
others, this Member urges his colleagues to support H.R. 4759, the 
U.S.-Australia Free Trade Implementation Act.
  Mr. CARSON of Oklahoma. Mr. Speaker, today unfortunately, I rise to 
voice my opposition to this trade agreement. I do feel that trade is 
essential to America's sustained economic vitality and I also feel that 
we must make every effort to ensure that international markets are open 
to U.S. goods. Exports have accounted for almost 30 percent of American 
growth over the last decade. In fact, my state of Oklahoma sold more 
than $3 billion worth of exports to more than 100 foreign markets last 
year. With these statistics in mind, it pains me to vote against this 
agreement.
  When casting my vote, I must think of the many Oklahoma farmers and 
ranchers that I have spoken with about this agreement and I must take 
into consideration how this agreement will severely cripple their 
ability to support themselves and their families. In particular, the 
provisions of this agreement will unfairly disadvantage the beef and 
wheat industries, which comprise two-thirds of Oklahoma's agricultural 
exports. This agreement would allow increased quantities of Australian 
beef to flood the U.S. market, which will result in unacceptably low 
market prices for American cattlemen. In Oklahoma alone, more than 
105,000 jobs associated with the cattle industry will be put in 
jeopardy by the adverse effects of this agreement. In addition to the 
beef industry, the continued existence of the Australian Wheat Board 
under this agreement will force America's wheat farmers to continue 
their export competition in the international markets against a state 
run monopoly. A government backed monopoly, like the Australian Wheat 
Board, which dictates the price of wheat rather than allowing the free 
market to take its course, thereby allows Australian wheat to 
consistently undercut the price of American wheat in international 
markets. Once again, American farmers must be able to sell their 
products if they are going to support themselves and their families. 
This agreement does not afford them that opportunity.
  Mr. OTTER. Mr. Speaker, I rise today to address some of the important 
provisions contained in H.R. 4759, United States-Australia Free Trade 
Implementation Act. While I am unable to support this agreement due to 
concerns over the impact it could have on dairy farmers and cattle 
ranchers in my district, I am very supportive of some provisions of 
this agreement and feel it is important to address those issues.
  I am pleased the United States and Australia, through this Free Trade 
Agreement, have each recognized and addressed the importance of 
protecting private intellectual property. The entertainment industry in 
the United States is a valuable part of our national economy and the 
zero tariffs provisions addressing technology and entertainment 
products will ultimately debit our Nation's import/export trade column.
  By protecting creative works produced in the United States, we are 
ensuring the long-term vitality of the American entertainment and 
technology industries, as well as, reinforcing our Nation's recognition 
of, and commitment to protecting private property.
  The increases in criminal and civil protections against piracy 
contained in this bill will certainly prove a valuable deterrent 
against electronic pirates. These kinds of private property protections 
are the only way to ensure creative genius is rewarded. In fact, 
Abraham Lincoln said, ``The patent system added the fuel of interest to 
the fire of genius,'' thus leading us to understand that the protection 
of invention and creation, including private intellectual property, is 
the only way to promote further artistic creation and innovation.
  Again, while I am unable to support the agreement as a whole, I felt 
strongly that the measures aimed at preventing creative and digital 
piracy should be recognized and applauded.
  Ms. WATSON. Mr. Speaker, today is a great day for the protection of 
intellectual property rights in America and around the world. The U.S.-
Australia Free Trade Agreement, of which I am a strong supporter, 
serves as a great testament to our Nation's commitment in safeguarding 
and strengthening the rights of intellectual property holders. I 
strongly urge my colleagues to support this bill.
  Australia and the United States have long had a strong relationship, 
be it economically, politically, and culturally. In addition to nearly 
$60 billion invested in the United States by Australian companies, two-
way trade between the two countries is currently at over $28 billion 
per year and growing. The U.S.-Australia agreement before us today 
would further strengthen these economic ties by expanding market access 
for the distribution of U.S. entertainment products and by setting the 
highest standards of copyright protection for the modern digital age.
  For example, among many of its outstanding provisions, the Agreement 
would establish strong anti-circumvention provisions to prohibit 
tampering with copyright protection technologies. It includes strong IP 
enforcement language, which includes enhanced criminal standards for 
copyright infringement and stronger remedies and penalties. It would 
also eliminate tariffs on all U.S. movies, music, consumer products, 
books and magazines exported into Australia, and broaden market access 
for U.S. films and television programs over a variety of media, such as 
cable, satellite, and the internet. Finally, the FTA provides 
groundbreaking commitment to non-discriminatory treatment of digital 
products, including DVDs and CDs, and an agreement not to impose 
customs duties on such products.
  The U. S.-Australia Free Trade Agreement is a giant step forward in 
improving the protection of intellectual property rights and in 
promoting the access of U.S. entertainment products around the world. 
It is good for our economy and good for our entertainment workers, who 
have witnessed drastic erosions in the values of their products due to 
unprecedented global piracy. When a major trading partner such as 
Australia makes these type of commitments to protect the products of 
the American creative community, we need to embrace them.
  I strongly urge my colleagues to support the U.S.-Australia FTA.
  Mr. STARK. Mr. Speaker, I rise today in opposition to H.R. 4759, the 
U.S.-Australia Free Trade Agreement (FTA). Once again the 
administration has given the pharmaceutical industry open access to the 
cookie jar. The result, to no one's surprise, is a free trade agreement 
that ensures the continued profitability of pharmaceutical 
manufacturers at the expense of average Americans who must buy drugs 
from other countries just to afford the prescriptions they need.
  This agreement is about trusting the administration on prescription 
drugs. Unfortunately, the administration's recent record on this issue 
shows they are less than willing to tell the truth. During the debate 
on the Medicare prescription drug bill the administration hid the fact 
that the prescription benefit would cost $534 billion instead of the 
projected $400 billion.

[[Page H5719]]

  Just today we learned that the administration has again missed the 
mark on an important estimate. According to this morning's New York 
Times 3.8 million people will lose retiree health coverage under the 
new Medicare law. This CMS estimate is 1.4 million people higher than 
the 2.4 million we were told during the Medicare debate.
  The moral of the story is we can't trust the administration to make 
domestic health policy without congressional guidance. I don't trust 
USTR and the administration on prescription drugs, and you shouldn't 
either.
  Less than one year ago, this House passed a bipartisan bill directing 
the Secretary of Health and Human Services to promulgate regulations 
allowing for reimportation of prescription drugs. There remain a number 
of pending proposals in the Senate that would legalize reimportation, 
as well. However, instead of fronting the reimportation issue in open 
debate, the administration took a back door approach, slipping language 
into the Australia agreement that effectively prohibits Congress from 
passing reimportation legislation.
  Last time I checked, reimportation was a domestic health policy issue 
that should be debated in Congress. When the administration realized 
they were losing the battle, however, they turned to trade negotiation 
authority and their wealthy donor friends at the Pharmaceutical 
Research and Manufacturers of America (PhRMA), to find another 
alternative.
  Last year the pharmaceutical industry spent $108 million on federal 
lobbying, and it is now clear they have purchased the keys to the 
kingdom. PhRMA used its power and influence during the FTA negotiations 
to obtain language that effectively precludes Congress from passing 
legislation allowing reimportation. As a result, U.S. citizens will 
never have access to affordable prescription drugs and the 
pharmaceutical manufacturers will continue to profit at the expense of 
Americans' health.
  A vote for this FTA sets a dangerous precedent for the future of 
domestic pharmaceutical policy. Deputy U.S. Trade Representative 
Josette Shiner has already explained what will happen next. Testifying 
before the Senate Finance Committee, Ms. Shiner said the pharmaceutical 
provisions in the Australia FTA ``lay the groundwork for future FTAs,'' 
which will ``steer us in ongoing and future global, regional, and 
bilateral negotiations--including upcoming FTA negotiations and 
consultations with Canada and other major trading partners bilaterally 
and in international fora like the OECD.''
  While I have no doubt the USTR knows how to negotiate a free trade 
agreement, I question whether they have any idea how their negotiations 
affect domestic health policy. During the negotiations with Australia, 
USTR pushed for language that would have decimated how the Veterans 
Administration and the Department of Defense buy drugs for our 
soldiers, veterans and their families. Though this language was later 
removed, the final agreement is so ambiguous, there are no guarantees 
Australia will not challenge our domestic drug procurement procedures. 
Besides the VA and Department of Defense, this could also affect 
Medicaid, Medicare and other federal programs.

  In a brief moment of honesty, the Administration admitted that the 
transparency requirements in Annex 2-C of the FTA actually do apply to 
Medicare Part B drugs. Though no changes are currently necessary to 
comply with the FTA, there is no guarantee that we won't have to act in 
the future to change Medicare drug policy because of the Australia FTA 
and future agreements that share this transparency language. One 
possible problem in the near future is the switch to average sales 
price for Part B drugs in 2006. It is very clear that this payment 
policy change does not meet the transparency requirements of Annex 2-C, 
but as long as PhRMA is happy, I guess we should all rejoice and turn 
our backs on policies designed to lower the cost of Part B drugs for 
Medicare beneficiaries.
  I urge all members today to think long and hard about what this vote 
means for the future of domestic prescription drug policy. Don't let 
anyone tell you that this vote is just about the U.S. and Australia and 
therefore you have nothing to worry about. If you have been touting the 
benefits of reimportation to constituents, but decide to vote for this 
FTA, I suggest you be prepared to deal with the backlash. If you truly 
care about reimportation and want to be able to use the issue on the 
campaign trail, vote against the U.S. Australia Free Trade Agreement.
  Mr. THOMAS. Mr. Speaker, I rise today in strong support of H.R. 4759, 
to implement the United States--Australia Free Trade Agreement. The FTA 
is a solid agreement that will benefit American workers, farmers, 
consumers, businesses and the U.S. economy. The FTA also helps to 
solidify the economic component of our strategic relationship with 
Australia. While this bill has been proceeding through the legislative 
process, I have emphasized the commercial benefits that this agreement 
will bring. Today, I will focus on the broader picture because I think 
it is important to also consider this FTA in that context.
  Australia is a very close friend and important ally of the United 
States. We share the belief in the power of freedom, democracy, and 
liberty, and our two countries are examples to the world of how these 
ideals can foster individual achievement. Australian troops have fought 
with American soldiers in all of the major conflicts of the 20th and 
21st centuries.
  Like a healthy marriage, our alliance cannot be taken for granted, 
and it must be continuously nurtured, assessed and adapted to 
accommodate modern times. Both countries believe that dynamic, open and 
efficient economies promote higher growth and better living standards 
and create more jobs in our respective countries.
  Consistent with those beliefs, this Agreement will provide real 
benefits to the American and Australian peoples and our economies. This 
FTA will do for our economic relationship during the next 50 years what 
the ANZUS (Australia, New Zealand, and United States) treaty has done 
for the political and military relationship during the past 50 years.
  The FTA will solidify a strong economic partnership in the World 
Trade Organization, where the United States and Australia share many 
goals. I encourage my colleagues to send an overwhelming message of 
approval to our friends ``down under'' and vote ``yes'' for this 
Agreement.
  Mr. GUTKNECHT. Mr. Speaker, I certainly appreciate that the U.S. 
Trade Representative has addressed the important concerns related to 
agriculture in this free trade agreement. Agriculture is important to 
my district and the State of Minnesota. However, I cannot support the 
United States-Australia Free Trade Implementation Act due to the 
provisions related to pharmaceuticals that were included in this 
agreement.
  On July 25, 2003, 242 of my colleagues joined me in supporting my 
legislation to implement a true, market-based system whereby consumers 
could access safe and affordable prescription drugs. I find it 
interesting that a free trade agreement would blatantly run counter to 
legislation that would, in effect, establish a market-based arena for 
prescription drugs.
  Proponents of this language have said that it is practically 
meaningless because Australian law already bans the export of 
subsidized prescription drugs. Why then, do we feel the need to include 
such a meaningless provision in the trade agreement?
  Let me illustrate why this language is not meaningless. In fact, it 
attempts to hamstring efforts to provide affordable prescription drugs 
for seniors, the uninsured and consumers who continue to pay 30 to 300 
percent more for prescription drugs than anyone else.
  In 2000, the MEDS Act included a provision that prohibited 
pharmaceutical manufacturers from entering into a contract or agreement 
if they included any language that would prevent the sale or 
distribution of prescription drugs. I have attached this language to be 
included in the Record, because it no longer exists in U.S. law. I 
discovered recently that the Medicare bill included a hidden provision 
which stripped this important language. This is outrageous.
  So while proponents of this agreement claim that this language simply 
restates current law, current law is the result of hidden maneuvers 
without the knowledge of the 242 Members who support open markets for 
prescription drugs.
  And who exactly provided the counsel to USTR while they drafted this 
supposedly innocuous language? Twenty-five members of the advisory 
committee advised the USTR on intellectual property rights regarding 
prescription drugs. Of those 25 members, at least 15 have interests in 
the pharmaceutical industry. There was not one senior, consumer or 
market access advocate on the panel.
  With this language, when prescription drug market access legislation 
becomes law, and I believe it will, we will be in breach of the free 
trade agreement. The Australian government can enter into a dispute 
settlement case contending the law. Many have argued that this is not a 
likely scenario. It seems equally unlikely that American taxpayers 
would be forced to subsidize the research and development of 
prescription drugs for consumers around the world and still pay the 
world's highest prices, but we do.
  I sat down with USTR representatives to give them a chance to tell 
their side of the story. When I asked who requested the prescription 
drug language, they had no answer. No one but the two negotiators were 
in the room and no one was taking notes. That seems a poor way to 
negotiate a free, fair and open agreement for trade. And it doesn't 
pass the smell test to me.
  The free trade agreement could set a dangerous precedent that FDA--or 
other opponents of open markets for prescription drugs--will use to 
prevent American consumers access to affordable prescription drugs. I 
have always supported free and fair trade--this

[[Page H5720]]

agreement is neither free nor fair concerning prescription drugs.
  Mr. BLUNT. Mr. Speaker, listening to today's dialogue on the floor, I 
have been encouraged by the strong bipartisan support for the United 
States-Australia Free Trade Agreement. Passing this implementation bill 
today will pave the way for an even deeper economic relationship with 
one of our most important strategic allies.
  The Australian Government has not only sided with us, but committed 
valuable troops and resources to helping the United States in every 
major conflict in the last century, including the global war on terror. 
Notably, Prime Minister Howard has shown courage and dedication to the 
cause of freedom over the past two years with his steadfast commitment 
to the coalition in Iraq.
  Mr. Speaker, like our own economy, Australia's is a modern, well-
developed, transparent economic system. A deep trade relationship 
already exists between the United States and Australia in the form of 
$28 billion per year.
  As with every well-negotiated trade agreement, both sides will 
benefit immediately upon the enactment of this free trade agreement. 
For the United States, this means that more than 99 percent of U.S. 
exports of manufactured goods to Australia will become tariff-free on 
day one, resulting in a possible $2 billion per year in increased 
manufacturing exports; U.S. agricultural exports, currently totaling 
$400 million, will receive immediate duty free access to the Australian 
market; and American services providers, including the 
telecommunications, financial services, energy, delivery, and 
entertainment industries, will be accorded substantial new access to a 
major developed market.
  The reasons I just listed, and there are many others, help explain 
why this agreement will receive such broad and deep support from the 
House of Representatives.
  I would like to thank my friend from New York, Mr. Crowley, for his 
help in generating support for the agreement on the other side of the 
aisle. I would also like to thank Ambassador Zoellick and his staff for 
their hard work in negotiating this agreement.
  Mr. Speaker, I urge all of my colleagues to vote in favor of 
expanding trade and investment opportunities for U.S. firms, creating 
jobs for American workers, and deepening an already strong relationship 
with the Australian Government and the people of Australia.
  Mr. CRANE. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. All time for debate has expired.
  Pursuant to the rule, the bill is considered read for amendment, and 
the previous question is ordered.
  The question is on 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 passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. CRANE. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  The vote was taken by electronic device, and there were--yeas 314, 
nays 109, answered ``present'' 1, not voting 9, as follows:

                             [Roll No. 375]

                               YEAS--314

     Ackerman
     Aderholt
     Akin
     Allen
     Bachus
     Baird
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Beauprez
     Becerra
     Bell
     Bereuter
     Berkley
     Berman
     Biggert
     Bilirakis
     Bishop (GA)
     Bishop (NY)
     Blackburn
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boswell
     Boyd
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Capps
     Capuano
     Cardin
     Carter
     Castle
     Chabot
     Chandler
     Chocola
     Clay
     Coble
     Cole
     Cooper
     Cox
     Cramer
     Crane
     Crenshaw
     Crowley
     Cubin
     Culberson
     Cunningham
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeGette
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doolittle
     Doyle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Engel
     English
     Eshoo
     Etheridge
     Everett
     Farr
     Feeney
     Ferguson
     Flake
     Foley
     Forbes
     Ford
     Fossella
     Franks (AZ)
     Frelinghuysen
     Frost
     Gallegly
     Garrett (NJ)
     Gephardt
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gonzalez
     Goodlatte
     Gordon
     Goss
     Granger
     Graves
     Green (TX)
     Greenwood
     Hall
     Harman
     Harris
     Hart
     Hastings (WA)
     Hayworth
     Hefley
     Hensarling
     Herger
     Hill
     Hinojosa
     Hobson
     Holden
     Holt
     Honda
     Hooley (OR)
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hyde
     Inslee
     Israel
     Issa
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, E. B.
     Johnson, Sam
     Jones (OH)
     Keller
     Kelly
     Kennedy (MN)
     Kennedy (RI)
     Kilpatrick
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Lampson
     Langevin
     Larsen (WA)
     Latham
     LaTourette
     Leach
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     LoBiondo
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Maloney
     Manzullo
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCotter
     McCrery
     McDermott
     McGovern
     McHugh
     McInnis
     McKeon
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Mica
     Miller (FL)
     Miller (MI)
     Miller (NC)
     Miller, Gary
     Moore
     Moran (VA)
     Murphy
     Murtha
     Musgrave
     Myrick
     Napolitano
     Neal (MA)
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nussle
     Olver
     Ortiz
     Ose
     Oxley
     Pelosi
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Putnam
     Radanovich
     Ramstad
     Regula
     Renzi
     Reyes
     Reynolds
     Rodriguez
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ross
     Roybal-Allard
     Royce
     Ruppersberger
     Ryan (WI)
     Ryun (KS)
     Sanchez, Loretta
     Sandlin
     Saxton
     Schiff
     Schrock
     Scott (GA)
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Sherwood
     Shimkus
     Shuster
     Simmons
     Skelton
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Snyder
     Souder
     Stearns
     Stenholm
     Sullivan
     Sweeney
     Tancredo
     Tanner
     Tauscher
     Tauzin
     Terry
     Thomas
     Thompson (CA)
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Towns
     Turner (OH)
     Turner (TX)
     Udall (CO)
     Upton
     Van Hollen
     Visclosky
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Watson
     Watt
     Weiner
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wu
     Wynn
     Young (AK)
     Young (FL)

                               NAYS--109

     Abercrombie
     Alexander
     Andrews
     Baca
     Baldwin
     Bass
     Berry
     Bishop (UT)
     Boucher
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Burton (IN)
     Cardoza
     Carson (OK)
     Case
     Clyburn
     Conyers
     Costello
     Cummings
     Davis (IL)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Emanuel
     Emerson
     Evans
     Fattah
     Filner
     Frank (MA)
     Goode
     Green (WI)
     Grijalva
     Gutierrez
     Gutknecht
     Hastings (FL)
     Hayes
     Herseth
     Hinchey
     Hoekstra
     Hostettler
     Jackson (IL)
     Jones (NC)
     Kanjorski
     Kaptur
     Kildee
     Kleczka
     Kucinich
     Lantos
     Larson (CT)
     Lee
     Lipinski
     Lucas (OK)
     Markey
     Marshall
     McCollum
     McIntyre
     McNulty
     Michaud
     Millender-McDonald
     Miller, George
     Mollohan
     Moran (KS)
     Nadler
     Oberstar
     Obey
     Osborne
     Otter
     Owens
     Pallone
     Pascrell
     Pastor
     Paul
     Payne
     Pearce
     Peterson (MN)
     Pombo
     Pomeroy
     Quinn
     Rahall
     Rehberg
     Rothman
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanders
     Schakowsky
     Scott (VA)
     Sensenbrenner
     Serrano
     Simpson
     Slaughter
     Smith (MI)
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Taylor (MS)
     Taylor (NC)
     Thompson (MS)
     Tierney
     Udall (NM)
     Velazquez
     Waters
     Waxman
     Woolsey

                        ANSWERED ``PRESENT''--1

       
     Nunes
       

                             NOT VOTING--9

     Carson (IN)
     Collins
     Hoeffel
     Isakson
     Istook
     Kind
     Majette
     Rangel
     Ros-Lehtinen


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. Hastings of Washington) (during the 
vote). Members are advised that there are 2 minutes remaining in this 
vote.

                              {time}  1719

  Messrs. MARSHALL, THOMPSON of Mississippi and CLYBURN changed their 
vote from ``yea'' to ``nay.''
  Mrs. NAPOLITANO, Ms. GINNY BROWN-WAITE of Florida and Mr. TOWNS 
changed their vote from ``nay'' to ``yea.''
  So the bill was passed.
  The result of the vote was announced as above recorded.

                          ____________________