[Congressional Record Volume 150, Number 102 (Wednesday, July 21, 2004)]
[Senate]
[Pages S8506-S8516]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
UNITED STATES-MOROCCO FREE-TRADE AGREEMENT IMPLEMENTATION ACT
The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of S. 2677, which the clerk will report.
The legislative clerk read as follows:
A bill (S. 2677) to implement the United States-Morocco
Free-Trade Agreement.
The PRESIDING OFFICER. Under the previous order, time until 11:30
p.m. is equally divided for debate on or between the chairman and
ranking member.
The Senator from Wyoming.
Mr. THOMAS. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. ALEXANDER. I ask unanimous consent that the order for the quorum
call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. ALEXANDER. Mr. President, what is the pending matter?
The PRESIDING OFFICER. The question is on the engrossment and third
reading of the bill.
The bill was ordered to be engrossed for a third reading and was read
the third time.
Mr. JOHNSON. Mr. President, I rise to discuss the Morocco-United
States free-trade agreement, FTA, and the impact this bilateral free
trade agreement will have on agricultural producers in my State of
South Dakota. While I retain concerns on a number of agreements
negotiated under Trade Promotion Authority, TPA, as part of fast track
trade negotiations navigated by the current administration, I see a
potential positive impact on the South Dakota economy from a number of
provisions in this agreement. I am pleased that the needs of many
sectors in our agricultural community were accounted for while
hammering out the terms included in this FTA.
I am disappointed at the recent passage of the Australian free-trade
agreement, AFTA, which seriously weakens our ability to foster growth
in the agricultural sector. It is concerning that the adoption of the
AFTA will hinder the retention of our agriculture producers, exacerbate
supply, and consequently undermine our Federal price support programs.
When dealing with sensitively priced commodities and a delicate supply
and demand balance, I believe we must prudently evaluate the economic
ramifications from any proposed trade agreement. I am concerned for the
rural communities in my home state of South Dakota, and I will continue
to evaluate trade agreements on a case by case basis to ascertain the
potential benefits and negative impacts.
Despite these concerns, I am pleased to see that the Moroccan free-
trade agreement holds promise and provides a number of potentially
rewarding terms for United States producers and ranchers. The agreement
encompasses a wide variety of commodities that are important to the
health of the rural economy in South Dakota, including beef, soybeans,
wheat, corn and sorghum. As in the case of beef, for example,
increasing market access under this agreement is imperative for
ensuring our producers and ranchers maintain ample opportunity for
promoting quality American beef. This opportunity will be facilitated
by a low in-tariff quota that will promptly be zeroed out.
As in the case of soybeans, duties on soybeans used for processing
will cease immediately. Duties on soybeans for processed soy products
and other uses will be reduced by half in the first year, and
eliminated entirely within a 5-year timeframe. Additionally, wheat will
benefit from this bilateral FTA. Fluctuating weather conditions present
problematic conditions for Moroccan farmers, and as a significant
[[Page S8507]]
wheat importer, a beneficial trading relationship can be established
from increased market access to the Kingdom of Morocco.
While I retain reservations about the direction the administration's
free trade agenda has taken, I am pleased that a free trade agreement
has been proposed that has garnered the support of many American
agriculture producers, and will facilitate increased market access and
positive economic impact for our rural communities.
Mr. ALLEN. Mr. President, I rise today to speak on the pending
measure before the Senate, the U.S.-Morocco free-trade agreement. Soon
this body will likely pass the implementing legislation and send it to
the President for signature and subsequent enactment. Before that takes
place, I believe it is important to outline to the people of the
Commonwealth of Virginia my position on this matter and why I will vote
in favor of its passage though it is not a perfect agreement.
The enactment of free trade agreements have the potential to increase
the profitability of U.S. companies, increase U.S. jobs, open new
markets for U.S. products and services and engender stronger
relationships with other nations. However, the central tenet of such
agreements must be fairness, clear benefit to all parties and a
relatively equitable number and degree of concessions. Understanding
that in any negotiation there must be some give and take, it is
counterproductive and damaging for the U.S. to agree to provisions
within these agreements that leave U.S. industries susceptible to
loopholes that allow a non-party country duty free access to our
market.
In the case of the Morocco free-trade agreement I am speaking of the
textile provisions. This agreement, while in many ways better than
previous free trade agreements, would still allow for non-party
countries to export yarn or fabric to Morocco and upon production into
apparel, be imported into the United States duty-free. If our
government is going to negotiate an agreement with another country and
make concessions to secure an equally beneficial arrangement, I cannot
comprehend why loopholes would be included to permit a third party to
benefit from the agreement without having to meet the requirements or
make the concessions of those party to the trade pact.
Under a tariff preference level, the Morocco agreement will allow the
use of fabric and yarn from a non-party of up to thirty million square
meters equivalent. It is difficult to understand why such an exception
is necessary, given that the total Moroccan trade in fabric and yarn
with the U.S. in 2003 was 16.477 million square meters equivalent. I
have been in contact with many in the domestic textile industry and
have to sincerely agree with them that such a provision appears to be a
substantial loophole that will ultimately allow a country other than
the U.S. or Morocco to benefit from the U.S.-Morocco free-trade
agreement.
The U.S. government has an obligation to the American worker to do
away with the practice of providing exceptions like tariff preference
levels. A third-party country that would provide yarn and fabric under
these loopholes will have conceded nothing nor offered greater access
to its market as it benefits from the agreement negotiated between the
U.S. and Morocco. Make no mistake, concessions like this can adversely
affect American jobs. Domestic textile production has provided
Americans stable, well-paying jobs for generations; however the
enactment of free trade agreements that allow a party to go outside of
the agreement but enjoy duty-free access has contributed to the growing
number of unemployed textile workers in this country.
Going forward, I would strongly recommend to those negotiating trade
agreements on behalf of the American people to visit Southside Virginia
and gain a first-hand perspective on how the concessions made in trade
pacts can impact not only a few families, but entire communities. We
must make sure that when we are opening our markets to other countries
through trade agreements that we do not allow a third party to benefit
without being party to the requirements and concessions of that trade
agreement.
Even with the grave concerns I have with the textile provisions of
this agreement, I believe that on balance, it provides a net-plus for
the working people of the United States. The reduction in tariffs and
protection of intellectual property and trademarks will provide great
benefit to hundreds of thousands of U.S. jobs and further the global
market share of their enterprises. Additionally, the relatively
balanced nature of the U.S.-Morocco free-trade agreement sets a
valuable example with the other developing countries around the world.
The removal of tariffs on 95 percent of bilateral trade on the day of
enactment should greatly benefit the majority of U.S. industries and
their employees. Given that Morocco currently places a 20 percent duty
on U.S. exports while the U.S. only assigns a four percent tariff on
Moroccan exports this agreement makes a strong initial push for free
and open trade. With strong U.S. industries like information
technology, machinery and construction equipment poised to gain
immediate duty-free access to Morocco; the U.S. should see positive
gains in exports to Morocco in the near future.
The domestic farming community will see tariffs on a large number of
agriculture products cut significantly or eliminated immediately. The
reduction of tariffs and the implementation of new tariff-rate quotas
on products like beef, poultry and wheat will likely result in a
tremendous growth in the amount of U.S. agriculture products exported
to Morocco.
The U.S. has had a difficult time convincing its trading partners to
actively protect intellectual property and fully prosecute those found
to be pirating or counterfeiting U.S. software, movies and music. I am
pleased the Morocco agreement establishes new protections for
intellectual property rights and increases penalties for those found to
engage in the piracy and counterfeiting of U.S. products.
Finally, the enactment of the U.S.-Morocco free-trade agreement sends
a powerful message to developing nations around the world. It is a
clear indication that the U.S. is interested in developing mutually
beneficial economic and trade relationships that can result in greater
access to the U.S. market and hopefully closer ties with the U.S.
Agreements like the Morocco trade pact provide a clear example for
those countries in Africa and the Middle East willing to make political
and economic reforms.
In closing, I will vote in favor of the U.S.-Morocco free-trade
agreement because comprehensively, it is beneficial to the U.S.
business community. The reduction of tariffs and increased access to
markets will improve the profitability of many U.S. companies and
provide an example for future agreements with tolerant, reform-minded,
developing nations. This could have been an outstanding, purely
positive agreement, rather than a good agreement on balance.
Mr. McCAIN. Mr. President, the United States has enjoyed a close
relationship with Morocco since 1777, when Morocco became the first
nation to recognize the sovereignty of our fledgling Government. Since
then we have stood together through thick and thin, and Morocco today
remains one of America's dear friends. This free-trade agreement, FTA,
will further strengthen the bond between our two nations, and
illustrates the benefits of greater economic ties with countries in the
greater Middle East.
Initially, the decision to begin negotiations with Morocco was
controversial. But Morocco's economic liberalization and political
reform efforts, combined with its role as a stabilizing force in the
region, made the decision a simple one.
The trade negotiations produced an agreement that will render more
than 95 percent of bilateral trade in consumer and industrial products
duty-free immediately. U.S. investors in Morocco will be increasingly
able to rely on a secure, predictable legal framework mandated by the
FTA. U.S. banks, insurance companies, telecommunications companies and
others will get new access to markets within Morocco.
In addition, U.S. firms are guaranteed a fair and transparent process
for selling goods and services to a wide range of Moroccan Government
entities, via the FTA's government contracting anti-corruption
provisions. These kinds of measures are what we expect from a free-
trade agreement. Unfortunately, this agreement also
[[Page S8508]]
contains protectionist language antithetical to the tenets of free
trade.
As with the Australian FTA approved by the Senate last week, and the
Singapore agreement that went into effect in January, the United States
Trade Representative included language that could impair Congress's
ability to pass and implement drug importation legislation. Such
legislation is not only something Congress has worked on for the past
several years, but has also enacted.
The provisions USTR slipped into the Singapore, Australia and Morocco
FTAs have significant implications for drug importation. Let us be
clear about this language--it is antifree trade, serves only to block
American consumers from accessing lower cost goods and services, and
contravenes clear congressional intent.
Congress has repeatedly voted, with bipartisan majorities, to allow
drug importation. States and local governments are doing the same. An
overwhelming majority of Americans believe that they have a right to
import more affordable medicines. So a simple question comes to mind:
what is our Trade Representative, who is charged with representing the
interests of the American people, doing? Why deliberately include
language in bilateral trade agreements that could thwart importation
efforts? Why flagrantly disregard the intent of Americans and their
elected representatives? It seems to me that the special interests have
again found friendly territory.
When Americans wonder how this continues to happen, they should take
a glance at the list of intellectual property ``advisors'' that worked
with the negotiators. These advisors include representatives from drug
companies, the pharmaceutical industry as a whole, and other lobbyists
with a direct interest in blocking drug importation. How many public
health and consumer advocacy groups were included on this committee?
Zero.
The Singapore FTA was the first free-trade agreement to include
language that could impact drug importation. The Morocco FTA must be
the last.
Our trade negotiators must be less mindful of special interests and
more responsive to the express intent of the Congress. We granted the
President trade promotion authority, TPA, in 2002 to demonstrate our
Nation's re-energized commitment to negotiating strong free-trade
agreements. TPA was designed to lead to free trade, not more
protection.
This agreement is not the first in which the administration has made
use of TPA to promote its politically expedient policy priorities. Last
year, immigration provisions were included in the Singapore and Chile
FTAs. If the Administration is to continue to enjoy the privilege of
TPA, trade agreements must no longer be vehicles that include items
rightfully addressed by Congress under the Constitution.
The United States has been and should be the leading promoter of an
open global marketplace. Steel tariffs, agricultural subsidies in the
farm bill, and other forms of protection, however, have damaged
America's free-trade credentials. If special interest carve-outs, like
the one for the pharmaceutical industry in this FTA, continue to
pollute our trade agreements, we will all be worse off. Our economy
will suffer and our leadership role on trade will further decline.
I will vote yes, but let me reiterate what I said last week with
respect to the Australia agreement: Should another FTA being negotiated
now or in the future come before the Senate with similar protections
for special interests, I will find it even more difficult to vote in
favor of it.
Mr. LEVIN. Mr. President, I am disappointed to see that the U.S.-
Morocco Free-Trade Agreement contains patent protection language
similar to that contained in the U.S.-Australia Free-Trade Agreement.
Although I will not oppose this agreement on this one basis, I will
oppose the use of this language as a precedent for any future free-
trade agreement.
Mr. FEINGOLD. Mr. President, I opposed the Morocco free-trade
agreement. Unfortunately, it is one more in what has become an
increasing number of deeply flawed trade agreements. These agreements
continue to jeopardize U.S. jobs and businesses. They undermine
environmental, health, and safety protections. They hinder our ability
to loosen restrictions on reimportation of FDA-approved prescription
drugs. They limit our ability to use our tax dollars to help our own
businesses and workers through buy American policies, and to discourage
corporations from reincorporating overseas, and they limit the ability
of our democratic institutions to regulate essential services.
But though I opposed this trade agreement, I want to underscore my
firm belief that our bilateral relationship with Morocco is extremely
important. We need our Moroccan partners if we are to succeed in
pursuing our first foreign policy priority: the fight against al-Qaida
and associated global terrorist organizations. The United States cannot
afford to ignore this critical North African ally which has suffered,
as we have, brutal terrorist attacks. We cannot fight terrorists
without a strong international coalition sharing crucial intelligence,
drying up sources of financial and political support for terrorism, and
tracking down terrorist leaders. In order to have a strong partner to
count on, the U.S. must support the Moroccan people in their fight for
basic human rights, their efforts to combat corruption, and their work
to create the kinds of economic opportunities that the country's large
population of youth need. Without these efforts, this population will
stagnate and resentment will grow. The U.S. should be cultivating
future partners in Morocco, not future antagonists.
Mr. LAUTENBERG. Mr. President, this Free Trade Agreement should have
been easy for me to support.
It is an agreement with a moderate Arab nation, an FTA that will
integrate Morocco's economy with that of America. This FTA will aid
Morocco's economy, strengthen our ties with the Kingdom, and help to
bolster the contention that market economics can lead to a peaceful and
prosperous moderate Islam.
What troubles me is the Bush administration's ongoing inattention to
the labor and environmental protections in trade agreements, which is
inexcusable. This administration has refused to live up to the gold
standard on labor and environmental protections, a standard set by the
Clinton administration when it negotiated the United States-Jordan Free
Trade Agreement.
Instead, President Bush and U.S. Trade Representative Robert Zoellick
have backtracked, endorsing less stringent protections in agreements
with Chile and Singapore. The administration ignored the disapproval of
many in Congress of those provisions. Stunningly, the administration
did not include Jordan-style provisions in the Morocco agreement, even
though Moroccan officials announced they would be willing to accept
them.
In short, President Bush settled for weaker protections than he could
have gotten, and he did it for what would seem to be no reason other
than to antagonize labor groups, environmental groups and some in
Congress. I find that deplorable.
Despite the shortcomings of this agreement, however, and because
Morocco is making progress on its labor and environmental laws, I will
support this FTA to strengthen our ties with a moderate Arab nation
that has been a good global citizen.
Mr. BURNS. I have always said that I support free trade, as long as
it is fair trade. The Morocco free-trade agreement before us today is
an excellent example of that principle. Once this agreement goes into
effect, 95 percent of the tariffs on consumer and industrial goods are
eliminated, with the remaining tariffs eliminated in 9 years. This deal
represents the best access to a developing country yet. I applaud
Ambassador Zoellick for his hard work in achieving a balanced free
trade agreement that provides significant benefits to both trade
partners.
Morocco imports more than $11 billion in goods each year, with $475
million coming from the United States. We have an opportunity to
increase the United States presence in this emerging market. Current
circumstances are certainly less than ideal for American goods: imports
from the United States face a stiff tariff, over 20 percent. In
Montana, we have not yet benefited from trade with Morocco, and I can
only hope that passage of this agreement today will allow us to begin
exploring the advantages that it can offer
[[Page S8509]]
Montanans and Moroccans alike, without unreasonable tariff barriers for
our products.
I am especially pleased at the agriculture provisions in this FTA.
Too often, free trade agreements represent a losing deal for Montana's
farmers and ranchers, but I believe this agreement shows a commitment
to fair trade for agriculture. In 2003, the United States exported over
$152 million in agricultural products to Morocco. Under this agreement,
that number could more than double, and I expect that some of that
increase will be Montana beef and grains. According to an analysis by
the American Farm Bureau Federation, ``the agreement is expected to
result in a 10-to-1 gain for the U.S. agriculture sector, which already
enjoys a positive trade balance with Morocco.''
I commend the Trade Representative for the wheat provisions in this
FTA. I know that Morocco expressed some serious concerns about
negotiating access for U.S. wheat, and Ambassador Zoellick worked hard
to keep wheat on the table. Under this agreement, U.S. wheat exports
could experience a five-fold increase. At the same time, the Agreement
is sensitive to Moroccan domestic wheat producers. While we would
always prefer tariffs to be completely eliminated, the expansion of
tariff rate quotas, TRQs, in this agreement will allow Montana wheat
producers vastly expanded access to Moroccan markets. Currently, wheat
tariffs on U.S. exports to Morocco run as high as 135 percent. The
commitments to reduce tariffs and expand TRQs are positive changes for
our wheat producers.
In addition, the agreement includes an important provision that
ensures long-term fair access. If Morocco provides other trading
partners preferential access that is better than what we have here
today, Morocco has agreed to immediately extend that treatment to the
same U.S. product. This guarantees a level playing field for our
agriculture producers. Finally, Morocco has also agreed to work with us
at the WTO negotiations to limit the trade-distorting power of state
trading enterprises. This is the same agreement that we secured in the
Australia Free Trade Agreement approved last week. I am pleased to see
a growing international consensus that state trading enterprises, like
the Canadian Wheat Board, must be addressed to provide for real free
and fair trade. I urge Ambassador Zoellick to continue focusing on this
important issue.
Montana cattle producers also stand to benefit from this deal. Access
to Moroccan markets for high quality beef--the kind of beef American
cattle producers are known for is greatly increased. Tariffs on U.S.
beef are often as high as 275 percent. The commitment to reduce these
tariffs and to expand TRQs will allow domestic cattle producers to send
prime and choice beef into Morocco hotels and restaurants, providing
Morocco substantial tourism industry with the quality it demands. In
addition, Morocco has agreed to accept U.S. inspection standards for
beef, which will allow our products immediate access to Moroccan
markets. This is a fair deal for our cattle producers.
In addition to the benefits to agriculture, service providers, such
as telecommunications and construction, will have enhanced access to
Moroccan markets. Telecommunications will be provided with non
discriminatory access to the network. Intellectual property protection
is provided, as are agreements on labor and environmental standards.
The Morocco free-trade agreement represents an important step toward
the President's goal of establishing a Middle East Free Trade Area, and
I am pleased to offer my support.
Mr. BAUCUS. Mr. President, I spoke yesterday about the Morocco free-
trade agreement and its benefits for both the United States and
Morocco.
I hope and expect that when we vote on the Morocco implementing bill,
the bill will pass by an overwhelming margin.
That is a fitting way to cap a busy month on trade and head into the
summer recess.
As I look back at the accomplishments on trade since the beginning of
the year, I am pleased at how much we have done. It would be considered
a full plate in any year, but in an election year, it is especially
gratifying to have achieved so much.
We passed the JOBS Bill, a complex tax measure that will help create
jobs in America and bring the United States into compliance with the
WTO. That bill passed the Senate overwhelmingly with 92 votes.
We extended and enhanced an important trade and development program
for Africa--the Africa Growth and Opportunity Act through a unanimous
vote.
We created a different trade and development program for Haiti, also
through a unanimous vote.
And of course, just last week, we passed the Australia free-trade
agreement implementing bill with 80 votes.
It has been a busy year.
I am heartened by the strong votes all these measures attracted. No
victory is ever easy. They are hard fought by people working every day
to do the right thing.
I want to congratulate Senator Grassley and his staff for their
leadership, and Ambassador Zoellick and his excellent negotiating team
for all their hard work.
As I look ahead, there will be some difficult issues to confront. I
believe we have more work to do to rebuild a strong consensus on trade.
We could do better on both the substance of trade agreements and on the
process of considering them.
I also believe we should be devoting more of our resources toward
enforcing trade agreements we already have.
But today, I would like to focus on our successes on all we have
already accomplished, and on what we are about to do.
When we vote to approve the Morocco legislation, we will be
solidifying our oldest diplomatic relationship in the world.
We will be giving reform-minded governments in developing countries
around the world incentive to redouble their efforts to modernize their
economies.
We will also be setting a new standard for agreements with developing
countries in a variety of important areas. These include intellectual
property, market access, and even agriculture.
The Morocco agreement is a good agreement. I urge my colleagues to
vote for it.
Mr. GRASSLEY. Mr. President, just over 2 months ago I expressed my
interest in seeing both the U.S.-Australia and the U.S.-Morocco free-
trade agreements pass the Congress by the August recess. A lot of
people resisted this effort, arguing that it would be impossible for
both the House and Senate to hold hearings, prepare the legislation,
conduct mock mark-ups, report the bills, and pass implementing
legislation for two free trade agreements in just two months. While the
task was indeed difficult, I am very pleased to say that we are on the
verge of achieving my goal today.
In just a few moments the U.S. Senate will have an historic
opportunity to strengthen our relations with Morocco with the passage
of the United States-Morocco Free-Trade Agreement Implementation Act.
While nothing is certain, I expect this legislation to pass with strong
bipartisan support. Passage of this legislation follows on the heels of
a strong Senate vote in favor of the United States-Australia Free-Trade
Agreement last week. The Australia bill itself was preceded by renewal
and extension of the Africa Growth and Opportunity Act, which passed
the Senate by unanimous consent on June 24 of this year. Prior to that,
the Senate was able to work out its differences and pass the JOBS Act
by a vote of 92 to 5. I will note that each of these bills passed in an
election year, a year in which many pundits argued that nothing would
get done. I also want to point out the broad bipartisan support which
each of these bills received. In my mind, it is that element--
bipartisanship--that is the key to our success.
I want to thank my ranking member, Senator Baucus, and the members of
the Finance Committee for working with me to bring these bills to
fruition. There are a lot of demands placed upon Finance Committee
members and their staffs, and I appreciate their hard work and
dedication in helping us produce legislation that will receive broad
bipartisan support in the Senate.
Turning to the bill at hand, passage of the United States-Morocco
Free-
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Trade Agreement Implementation Act will help strengthen our
relationship with a long-standing friend and ally of the United States.
For over two hundred years, our two nations have enjoyed a strong and
mutually beneficial relationship. Today, Morocco is a country in
transition. It is a country that recognizes that its long-term economic
prosperity lies not in shutting itself off to the world, but in opening
up to the world. It is in large part Morocco's willingness to embrace
free market and democratic principles that led President Bush to select
Morocco as a potential free trade partner. This free-trade agreement
will help lock in and hasten reforms that the Moroccan Government
embraced on its own initiative. I am confident that this agreement will
spur growth and opportunity for Morocco and its people.
This trade agreement is also very good for the United States,
especially U.S. agriculture. Implementation of the agreement is
expected to help advance U.S. agriculture exports to Morocco to
unprecedented heights, enabling us to better compete with the European
Union, Canada, and South America in the Moroccan market.
Many people worked hard to see today's vote become a reality. First
and foremost, this would not have happened without the leadership of
President George W. Bush. As I have noted before, President Bush is
committed to building the U.S. economy by opening the world's markets
to U.S. goods and services. The United States-Morocco Free-Trade
Agreement is just the latest of his achievements in this regard.
The United States Trade Representative, Ambassador Robert B.
Zoellick, also merits special recognition and commendation for his
efforts in negotiating this agreement. His commitment to expanding U.S.
trade opportunities is steadfast, for which I am grateful. I also want
to express my thanks to John Veroneau, the general counsel in the
Office of United States Trade Representative, Matt Niemeyer, the
Assistant U.S. Trade Representative for Congressional Affairs, and Lisa
Coen, Deputy Assistant U.S. Trade Representative for Congressional
Affairs, for their many efforts to ensure that the committee was fully
apprised of developments during the negotiations and their efforts to
resolve concerns raised by members as the committee informally
considered proposed implementing legislation for this trade agreement.
In addition, I thank Michael Smythers, a special assistant to the
President working in the White House Office of Legislative Affairs, for
his efforts to facilitate our consideration of this implementing
legislation.
I commend my colleagues on the Finance Committee for their interest
in seeing that this trade agreement was concluded and that the
implementing legislation was passed without delay. I would like to
extend a special thanks to the ranking member of the committee, Senator
Baucus. We have worked together over the years to expand trade
opportunities for the benefit of U.S. farmers, ranchers, manufacturers,
and service workers, and to benefit U.S. consumers. I am quite pleased
with the outcome of our current efforts with the imminent passage of
this implementing bill today.
My trade staff on the Finance Committee worked diligently over the
past several weeks on developing the implementing bill and other
materials connected with it. My goal was to have this legislation
passed prior to the August recess, and they were instrumental in making
this happen. Moreover, my trade staff engaged in consultations with
officials from the Office of the United States Trade Representative
throughout the negotiations, which began way back in January 2003, so
this has been a long process for them. I greatly appreciate their hard
work.
My chief counsel and staff director, Kolan Davis, deserves
recognition. His dedication and skills are instrumental in advancing
the Finance Committee's agenda. The Chief International Trade Counsel
of the Finance Committee, Everett Eissenstat, also deserves special
mention. His expertise in trade policy and his ability to juggle
multiple trade priorities simultaneously are key to the Committee's
success. I would also like to recognize the other members of my trade
staff--my two trade counsels, David Johanson and Stephen Schaefer, for
their invaluable technical assistance throughout this process.
Additionally, the work of Zach Paulsen, Dan Shepherdson, and Tiffany
McCullen, is appreciated, for their dedication to the Finance
Committee's work and to the people of Iowa. Without the diligence and
hard work of my staff, we would not be at the point we are today.
Senator Baucus' trade staff also deserves recognition. The Democratic
staff director on the Finance Committee, Russ Sullivan, and the deputy
staff director, Bill Dauster, worked well with my staff throughout the
process. I also appreciate the efforts of Tim Punke, Senator Baucus'
Chief International Trade Counsel, as well as Brian Pomper, John
Gilliland, Shara Aranoff, Sara Andrews, and Pascal Niedermann.
Finally, I would like to thank Polly Craighill of the Office of the
Senate Legislative Counsel for the many hours she put into drafting the
implementing bill. Without her patience, hard work, and drafting
skills, today's vote would not have been possible.
I look forward to the signing of this legislation into law by
President Bush.
Mr. ALEXANDER. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second.
There is a sufficient second.
The bill having been read the third time, the question is, Shall the
bill pass?
The clerk will call the roll.
The legislative clerk called the roll.
Mr. REID. I announce that the Senator from North Carolina (Mr.
Edwards) and the Senator from Massachusetts (Mr. Kerry) are necessarily
absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 85, nays 13, as follows:
[Rollcall Vote No. 159 Leg.]
YEAS--85
Alexander
Allard
Allen
Baucus
Bayh
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Brownback
Bunning
Burns
Campbell
Cantwell
Carper
Chafee
Chambliss
Clinton
Cochran
Coleman
Collins
Conrad
Cornyn
Corzine
Craig
Crapo
Daschle
Dayton
DeWine
Dodd
Domenici
Durbin
Ensign
Enzi
Feinstein
Fitzgerald
Frist
Graham (FL)
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Inouye
Jeffords
Johnson
Kennedy
Kohl
Kyl
Landrieu
Lautenberg
Levin
Lieberman
Lincoln
Lott
Lugar
McCain
McConnell
Mikulski
Miller
Murkowski
Murray
Nelson (FL)
Nelson (NE)
Nickles
Pryor
Reed
Roberts
Rockefeller
Santorum
Sarbanes
Schumer
Smith
Snowe
Specter
Stabenow
Stevens
Sununu
Talent
Thomas
Warner
Wyden
NAYS--13
Akaka
Byrd
Dole
Dorgan
Feingold
Graham (SC)
Harkin
Hollings
Leahy
Reid
Sessions
Shelby
Voinovich
NOT VOTING--2
Edwards
Kerry
The bill (S. 2677) was passed, as follows:
S. 2677
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-Morocco 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. Arbitration of claims.
Sec. 107. Effective dates; effect of termination.
TITLE II--CUSTOMS PROVISIONS
Sec. 201. Tariff modifications.
[[Page S8511]]
Sec. 202. Additional duties on certain agricultural goods.
Sec. 203. Rules of origin.
Sec. 204. Enforcement relating to trade in textile and apparel goods.
Sec. 205. 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.
SEC. 2. PURPOSES.
The purposes of this Act are--
(1) to approve and implement the Free Trade Agreement
between the United States and Morocco 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 Morocco 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-Morocco 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-Morocco Free Trade Agreement entered
into on June 15, 2004, with Morocco and submitted to Congress
on _______, 2004; and
(2) the statement of administrative action proposed to
implement the Agreement that was submitted to Congress on
_______, 2004.
(b) Conditions for Entry Into Force of the Agreement.--At
such time as the President determines that Morocco 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
Morocco 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 the Agreement enters
into force.
(2) Effective date of certain proclaimed actions.--Any
action proclaimed by the President under the authority of
this Act that is not subject to the consultation and layover
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 to the Committee on Finance
of the Senate and the Committee on Ways and Means of the
House of Representatives a report 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
20 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 20
of the Agreement.
SEC. 106. ARBITRATION OF CLAIMS.
The United States is authorized to resolve any claim
against the United States covered by article 10.15.1(a)(i)(C)
or article 10.15.1(b)(i)(C) of the Agreement, pursuant to the
Investor-State Dispute Settlement procedures set forth in
section B of chapter 10 of the Agreement.
SEC. 107. 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 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
[[Page S8512]]
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.--
(1) Proclamation authority.--The President may proclaim--
(A) such modifications or continuation of any duty,
(B) such continuation of duty-free or excise treatment, or
(C) such additional duties,
as the President determines to be necessary or appropriate to
carry out or apply articles 2.3, 2.5, 2.6, 4.1, 4.3.9,
4.3.10, 4.3.11, 4.3.13, 4.3.14, and 4.3.15, and Annex IV of
the Agreement.
(2) Effect on moroccan gsp status.--Notwithstanding section
502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)),
the President shall terminate the designation of Morocco as a
beneficiary developing country for purposes of title V of the
Trade Act of 1974 on the date of entry into force of the
Agreement.
(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 Morocco regarding the staging of any duty treatment set
forth in Annex IV 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 Morocco 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 Tariff Schedule of the United States to
Annex IV 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) Definitions.--In this section:
(1) Agricultural safeguard good.--The term ``agricultural
safeguard good'' means a good--
(A) that qualifies as an originating good under section
203;
(B) that is included in the U.S. Agricultural Safeguard
List set forth in Annex 3-A of the Agreement; and
(C) for which a claim for preferential treatment under the
Agreement has been made.
(2) Applicable ntr (mfn) rate of duty.--The term
``applicable NTR (MFN) rate of duty'' means, with respect to
an agricultural 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 agricultural safeguard good
entered, without a claim for preferential tariff treatment,
on the date on which the additional duty is imposed under
subsection (b); or
(B) the column 1 general rate of duty that would have been
imposed under the HTS on the same agricultural safeguard good
entered, without a claim for preferential tariff treatment,
on December 31, 2004.
(3) F.O.B.--The term ``F.O.B.'' means free on board,
regardless of the mode of transportation, at the point of
direct shipment by the seller to the buyer.
(4) Schedule rate of duty.--The term ``schedule rate of
duty'' means, with respect to an agricultural safeguard good,
the rate of duty for that good set out in the Tariff Schedule
of the United States to Annex IV of the Agreement.
(5) Trigger price.--The ``trigger price'' for a good means
the trigger price indicated for that good in the U.S.
Agricultural Safeguard List set forth in Annex 3-A of the
Agreement or any amendment thereto.
(6) 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 U.S. Agricultural Safeguard
List set forth in Annex 3-A of the Agreement.
(b) Additional Duties on Agricultural Safeguard Goods.--
(1) Additional duties.--In addition to any duty proclaimed
under subsection (a) or (b) of section 201, and subject to
paragraphs (3), (4), (5), and (6) of this subsection, the
Secretary of the Treasury shall assess a duty on an
agricultural safeguard good, in the amount determined under
paragraph (2), 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.
(2) Calculation of additional duty.--The additional duty
assessed under this subsection on an agricultural safeguard
good shall be an amount determined in accordance with the
following table:
The additional duty is an amount equal to:e unit import price is:
0.t more than 10 percent of the trigger price..........................
30 percent of the excess of the applicable NTR (MFN) rate of duty over
the schedule rate of duty.
50 percent of such excess.ot more than 60 percent of the trigger price.
70 percent of such excess.ot more than 75 percent of the trigger price.
100 percent of such excess. trigger price..............................
(3) Exceptions.--No additional duty shall be assessed on a
good under this subsection 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.).
(4) Termination.--The assessment of an additional duty on a
good under this subsection shall cease to apply to that good
on the date on which duty-free treatment must be provided to
that good under the Tariff Schedule of the United States to
Annex IV of the Agreement.
(5) Tariff-rate quotas.--If an agricultural safeguard good
is subject to a tariff-rate quota under the Agreement, any
additional duty assessed under this subsection shall be
applied only to over-quota imports of the good.
(6) Notice.--Not later than 60 days after the date on which
the Secretary of the Treasury assesses an additional duty on
a good under this subsection, the Secretary shall notify the
Government of Morocco in writing of such action and shall
provide to the Government of Morocco data supporting the
assessment of additional duties.
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 sub-heading, such reference shall
be a reference to a heading or subheading of the HTS.
(b) Originating Goods.--
(1) In general.--For purposes of this Act and for purposes
of implementing the preferential tariff treatment provided
for under the Agreement, a good is an originating good if--
(A) the good is imported directly--
(i) from the territory of Morocco into the territory of the
United States; or
(ii) from the territory of the United States into the
territory of Morocco; and
(B)(i) the good is a good wholly the growth, product, or
manufacture of Morocco or the United States, or both;
(ii) the good (other than a good to which clause (iii)
applies) is a new or different article of commerce that has
been grown, produced, or manufactured in Morocco, the United
States, or both, and meets the requirements of paragraph (2);
or
(iii)(I) the good is a good covered by Annex 4-A or 5-A of
the Agreement;
(II)(aa) each of the nonoriginating materials used in the
production of the good undergoes an applicable change in
tariff classification specified in such Annex as a result of
production occurring entirely in the territory of Morocco or
the United States, or both; or
(bb) the good otherwise satisfies the requirements
specified in such Annex; and
(III) the good satisfies all other applicable requirements
of this section.
(2) Requirements.--A good described in paragraph (1)(B)(ii)
is an originating good only if the sum of--
(A) the value of each material produced in the territory of
Morocco or the United States, or both, and
(B) the direct costs of processing operations performed in
the territory of Morocco or the United States, or both,
is not less than 35 percent of the appraised value of the
good at the time the good is entered into the territory of
the United States.
(c) Cumulation.--
(1) Originating good or material incorporated into goods of
other country.--An originating good or a material produced in
the territory of Morocco or the United States, or both, that
is incorporated into 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 grown, produced,
or manufactured in the territory of Morocco or 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.
(d) Value of Materials.--
(1) In general.--Except as provided in paragraph (2), the
value of a material produced in the territory of Morocco or
the United States, or both, includes the following:
(A) The price actually paid or payable for the material by
the producer of such good.
(B) The freight, insurance, packing, and all other costs
incurred in transporting the material to the producer's
plant, if such costs are not included in the price referred
to in subparagraph (A).
(C) The cost of waste or spoilage resulting from the use of
the material in the growth, production, or manufacture of the
good, less the value of recoverable scrap.
(D) Taxes or customs duties imposed on the material by
Morocco, the United States, or both, if the taxes or customs
duties are not remitted upon exportation from the territory
of Morocco or the United States, as the case may be.
[[Page S8513]]
(2) Exception.--If the relationship between the producer of
a good and the seller of a material influenced the price
actually paid or payable for the material, or if there is no
price actually paid or payable by the producer for the
material, the value of the material produced in the territory
of Morocco or the United States, or both, includes the
following:
(A) All expenses incurred in the growth, production, or
manufacture of the material, including general expenses.
(B) A reasonable amount for profit.
(C) Freight, insurance, packing, and all other costs
incurred in transporting the material to the producer's
plant.
(e) Packaging and Packing Materials and Containers for
Retail Sale and for Shipment.--Packaging and packing
materials and containers for retail sale and shipment shall
be disregarded in determining whether a good qualifies as an
originating good, except to the extent that the value of such
packaging and packing materials and containers have been
included in meeting the requirements set forth in subsection
(b)(2).
(f) Indirect Materials.--Indirect materials shall be
disregarded in determining whether a good qualifies as an
originating good, except that the cost of such indirect
materials may be included in meeting the requirements set
forth in subsection (b)(2).
(g) Transit and Transshipment.--A good shall not be
considered to meet the requirement of subsection (b)(1)(A)
if, after exportation from the territory of Morocco or the
United States, the good undergoes production, manufacturing,
or any other operation outside the territory of Morocco 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 the
United States or Morocco.
(h) Textile and Apparel Goods.--
(1) De minimis amounts of nonoriginating materials.--
(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 Morocco or the
United States.
(C) Yarn, fabric, or group of fibers.--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.
(2) Goods put up in sets for retail sale.--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.
(i) Definitions.--In this section:
(1) Direct costs of processing operations.--
(A) In general.--The term ``direct costs of processing
operations'', with respect to a good, includes, to the extent
they are includable in the appraised value of the good when
imported into Morocco or the United States, as the case may
be, the following:
(i) All actual labor costs involved in the growth,
production, or manufacture of the good, including fringe
benefits, on-the-job training, and the costs of engineering,
supervisory, quality control, and similar personnel.
(ii) Tools, dies, molds, and other indirect materials, and
depreciation on machinery and equipment that are allocable to
the good.
(iii) Research, development, design, engineering, and
blueprint costs, to the extent that they are allocable to the
good.
(iv) Costs of inspecting and testing the good.
(v) Costs of packaging the good for export to the territory
of the other country.
(B) Exceptions.--The term ``direct costs of processing
operations'' does not include costs that are not directly
attributable to a good or are not costs of growth,
production, or manufacture of the good, such as--
(i) profit; and
(ii) general expenses of doing business that are either not
allocable to the good or are not related to the growth,
production, or manufacture of the good, such as
administrative salaries, casualty and liability insurance,
advertising, and sales staff salaries, commissions, or
expenses.
(2) Good.--The term ``good'' means any merchandise,
product, article, or material.
(3) Good wholly the growth, product, or manufacture of
morocco, the united states, or both.--The term ``good wholly
the growth, product, or manufacture of Morocco, the United
States, or both'' means--
(A) a mineral good extracted in the territory of Morocco or
the United States, or both;
(B) a vegetable good, as such a good is provided for in the
HTS, harvested in the territory of Morocco or the United
States, or both;
(C) a live animal born and raised in the territory of
Morocco or the United States, or both;
(D) a good obtained from live animals raised in the
territory of Morocco or the United States, or both;
(E) a good obtained from hunting, trapping, or fishing in
the territory of Morocco or the United States, or both;
(F) a good (fish, shellfish, and other marine life) taken
from the sea by vessels registered or recorded with Morocco
or the United States and flying the flag of that country;
(G) a good produced from goods referred to in subparagraph
(F) on board factory ships registered or recorded with
Morocco or the United States and flying the flag of that
country;
(H) a good taken by Morocco or the United States or a
person of Morocco or the United States from the seabed or
beneath the seabed outside territorial waters, if Morocco or
the United States has rights to exploit such seabed;
(I) a good taken from outer space, if such good is obtained
by Morocco or the United States or a person of Morocco or the
United States and not processed in the territory of a country
other than Morocco or the United States;
(J) waste and scrap derived from--
(i) production or manufacture in the territory of Morocco
or the United States, or both; or
(ii) used goods collected in the territory of Morocco or
the United States, or both, if such goods are fit only for
the recovery of raw materials;
(K) a recovered good derived in the territory of Morocco or
the United States from used goods and utilized in the
territory of that country in the production of remanufactured
goods; and
(L) a good produced in the territory of Morocco or the
United States, or both, exclusively--
(i) from goods referred to in subparagraphs (A) through
(J), or
(ii) from the derivatives of goods referred to in clause
(i),
at any stage of production.
(4) Indirect material.--The term ``indirect material''
means a good used in the growth, production, manufacture,
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 growth, production, or manufacture of a good, including--
(A) fuel and energy;
(B) tools, dies, and molds;
(C) spare parts and materials used in the maintenance of
equipment and buildings;
(D) lubricants, greases, compounding materials, and other
materials used in the growth, production, or manufacture of a
good or used to operate equipment and 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 growth, production, or
manufacture of the good can reasonably be demonstrated to be
a part of that growth, production, or manufacture.
(5) Material.--The term ``material'' means a good,
including a part or ingredient, that is used in the growth,
production, or manufacture of another good that is a new or
different article of commerce that has been grown, produced,
or manufactured in Morocco, the United States, or both.
(6) Material produced in the territory of morocco or the
united states, or both.--The term ``material produced in the
territory of Morocco or the United States, or both'' means a
good that is either wholly the growth, product, or
manufacture of Morocco, the United States, or both, or a new
or different article of commerce that has been grown,
produced, or manufactured in the territory of Morocco or the
United States, or both.
(7) New or different article of commerce.--
(A) In general.--The term ``new or different article of
commerce'' means, except as provided in subparagraph (B), a
good that--
(i) has been substantially transformed from a good or
material that is not wholly the growth, product, or
manufacture of Morocco, the United States, or both; and
(ii) has a new name, character, or use distinct from the
good or material from which it was transformed.
(B) Exception.--A good shall not be considered a new or
different article of commerce by virtue of having undergone
simple combining or packaging operations, or mere dilution
with water or another substance that does not materially
alter the characteristics of the good.
(8) Recovered goods.--The term ``recovered goods'' means
materials in the form of individual parts that result from--
(A) the complete disassembly of used goods into individual
parts; and
[[Page S8514]]
(B) the cleaning, inspecting, testing, or other processing
of those parts that is necessary for improvement to sound
working condition.
(9) Remanufactured good.--The term ``remanufactured good''
means an industrial good that is assembled in the territory
of Morocco or the United States and that--
(A) is entirely or partially comprised of recovered goods;
(B) has a similar life expectancy to, and meets similar
performance standards as, a like good that is new; and
(C) enjoys a factory warranty similar to that of a like
good that is new.
(10) Simple combining or packaging operations.--The term
``simple combining or packaging operations'' means operations
such as adding batteries to electronic devices, fitting
together a small number of components by bolting, gluing, or
soldering, or packing or repacking components together.
(11) Substantially transformed.--The term ``substantially
transformed'' means, with respect to a good or material,
changed as the result of a manufacturing or processing
operation so that--
(A)(i) the good or material is converted from a good that
has multiple uses into a good or material that has limited
uses;
(ii) the physical properties of the good or material are
changed to a significant extent; or
(iii) the operation undergone by the good or material is
complex by reason of the number of processes and materials
involved and the time and level of skill required to perform
those processes; and
(B) the good or material loses its separate identity in the
manufacturing or processing operation.
(j) 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 Morocco pursuant to article 4.3.6 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. 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 Morocco to conduct a verification pursuant
to article 4.4 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 Morocco 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 Morocco,
is accurate.
(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 referred to in 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 referred to in 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 referred to in
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 referred to in
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 referred to in
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 referred to in
subsection (a)(1) regarding a claim described in subsection
(a)(2)(B).
SEC. 205. REGULATIONS.
The Secretary of the Treasury shall prescribe such
regulations as may be necessary to carry out--
(1) subsections (a) through (i) of section 203;
(2) amendments to existing law made by the subsections
referred to in paragraph (1); and
(3) proclamations issued under section 203(j).
TITLE III--RELIEF FROM IMPORTS
SEC. 301. DEFINITIONS.
In this title:
(1) Moroccan article.--The term ``Moroccan article'' means
an article that qualifies as an originating good under
section 203(b) of this Act or receives preferential tariff
treatment under paragraphs 9 through 15 of article 4.3 of the
Agreement.
(2) Moroccan textile or apparel article.--The term
``Moroccan textile or apparel article'' means an article
that--
(A) 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) is a Moroccan 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, a Moroccan 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 Moroccan 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
Moroccan article if, after the date on which the Agreement
enters into force, import relief has been provided with
respect to that Moroccan 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
[[Page S8515]]
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 IV 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 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 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 3 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 to facilitate adjustment by the domestic
industry to import competition 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 5 years.
(e) Rate After Termination of Import Relief.--When import
relief under this section 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 on which the relief terminates.
(f) Articles Exempt From Relief.--No import relief may be
provided under this section on any article that--
(1) is subject to an assessment of additional duty under
section 202(b); 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 with respect to a
good after the date that is 5 years after the date on which
duty-free treatment must be provided by the United States to
that good pursuant to Annex IV of the Agreement.
(b) Presidential Determination.--Import relief may be
provided under this subtitle in the case of a Moroccan
article after the date on which such relief would, but for
this subsection, terminate under subsection (a), if the
President determines that Morocco 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-Morocco 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) 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(b), the President shall determine whether, as a
result of the reduction or elimination of a duty under the
Agreement, a Moroccan textile or apparel article is being
imported into the United States in such increased quantities,
[[Page S8516]]
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.
SEC. 323. PERIOD OF RELIEF.
(a) In General.--Subject to subsection (b), the import
relief that the President provides under subsection (b) of
section 322 may not, in the aggregate, be in effect for more
than 3 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 5 years.
SEC. 324. ARTICLES EXEMPT FROM RELIEF.
The President may not provide import relief under this
subtitle with respect to any article if--
(1) the article has been subject to import relief under
this subtitle after the date on which the Agreement enters
into force; or
(2) the article is subject to import relief under chapter 1
of title II of the Trade Act of 1974.
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 on which 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.
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