[Congressional Record Volume 154, Number 68 (Monday, April 28, 2008)]
[Senate]
[Pages S3448-S3449]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




SENATE CONCURRENT RESOLUTION 78--EXPRESSING THE SENSE OF CONGRESS THAT 
THE PEOPLE'S REPUBLIC OF CHINA AND ALL ENTERPRISES OWNED OR CONTROLLED 
 BY THE PEOPLE'S REPUBLIC OF CHINA SHOULD MAKE PROPER DISCLOSURES WITH 
THE SECURITIES AND EXCHANGE COMMISSION REGARDING THE SELECTIVE DEFAULT 
                        STATUS OF CERTAIN BONDS

  Mr. INHOFE submitted the following concurrent resolution; which was 
referred to the Committee on Foreign Relations:

                            S. Con. Res. 78

       Whereas sovereign debt obligations (in this resolution 
     referred to as ``bonds'') of the Government of the People's 
     Republic of China were offered and sold in the United States 
     capital markets;
       Whereas the bonds constitute full faith and credit 
     sovereign obligations of the internationally recognized 
     Government of the People's Republic of China;
       Whereas the China subsequently defaulted on the bonds;
       Whereas the United States Foreign Claims Settlement 
     Commission determined that the bonds constitute an unpaid 
     general obligation of the Government of the People's Republic 
     of China;
       Whereas under the successor government doctrine of settled 
     international law (establishing the continuity of obligations 
     among successor governments), the repayment obligation for 
     the bonds is the obligation of the

[[Page S3449]]

     Government of the People's Republic of China;
       Whereas the Government of the People's Republic of China 
     has been duly notified by representatives of the affiliated 
     United States creditors of the demand for repayment of the 
     bonds;
       Whereas the Government of the People's Republic of China 
     continues to refuse to repay the bonds held by United States 
     citizens and has officially repudiated the debts; a clear 
     violation of United States law, international law, rules and 
     regulations of the World Bank and the International Monetary 
     Fund, and the United Nations Charter;
       Whereas the Government of the People's Republic of China 
     honored repayment of the bonds held by British citizens while 
     rejecting the claims of United States citizens;
       Whereas the Government of the People's Republic of China, 
     its state-owned enterprises, and other entities controlled by 
     the People's Republic of China continue to enjoy open and 
     unfettered access to the United States capital markets, while 
     the Government of the People's Republic of China continues to 
     reject the lawful claims of United States citizens;
       Whereas the sales of securities in the United States 
     capital markets issued by Chinese entities, including the 
     Government of the People's Republic of China and its state-
     owned enterprises, fail to disclose both the existence of the 
     defaulted debt of the Government of the People's Republic of 
     China and the continued evasion of repayment of the bonds, 
     the discriminatory treatment of United States citizens, and 
     the People's Republic of China's repudiation of official 
     debt;
       Whereas the wrongful actions of the Government of the 
     People's Republic of China are improperly concealed by the 
     continuing publication of artificial ``investment grade'' 
     sovereign credit rating classifications assigned to the 
     Chinese government by the 3 primary Nationally Recognized 
     Statistical Rating Organizations (NRSROs) and this 
     concealment fails to conform to the published definitions of 
     those Organizations;
       Whereas the continued publication of artificial 
     ``investment grade'' sovereign credit rating classifications 
     assigned to the Government of the People's Republic of China 
     provides an incentive to the Chinese government to avoid a 
     negotiated settlement with United States citizens regarding 
     China's default on its sovereign debt obligations;
       Whereas the lack of transparency concerning the selective 
     default of the Government of the People's Republic of China 
     poses a material risk to the investing public and threatens 
     the integrity of the United States capital markets; and
       Whereas to provide relief to United States bondholders, 
     restore transparency, uphold the rule of law, and affirm the 
     validity of public debt contracts: Now, therefore, be it
       Resolved by the Senate (the House of Representatives 
     concurring), That it is the sense of Congress that the 
     People's Republic of China and its government-owned and 
     controlled enterprises should be required to properly 
     disclose material information concerning the selective 
     default status of these bonds in all prospectuses and filings 
     with the Securities and Exchange Commission.

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