[Congressional Record (Bound Edition), Volume 157 (2011), Part 11]
[Senate]
[Pages 15089-15094]
[From the U.S. Government Publishing Office, www.gpo.gov]




          CURRENCY EXCHANGE RATE OVERSIGHT REFORM ACT OF 2011

  The PRESIDING OFFICER. Under the previous order, the Senate will 
resume consideration of S. 1619, which the clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 1619) to provide for identification of 
     misaligned currency, require action to correct the 
     misalignment, and for other purposes.

  Pending:

       Reid amendment No. 694, to change the enactment date.


                      Amendment No. 694 Withdrawn

  Mr. REID. Mr. President, I ask unanimous consent that the pending 
amendment be withdrawn.
  The PRESIDING OFFICER. Without objection, it is so ordered.

[[Page 15090]]

  The clerk will read the bill for the third time.
  The bill was ordered to be engrossed for a third reading and was read 
the third time.
  The PRESIDING OFFICER. Under the previous order, the bill having been 
read the third time, the question is, Shall the bill pass?
  Mr. DURBIN. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from New Hampshire (Mrs. 
Shaheen) is necessarily absent.
  Mr. KYL. The following Senator is necessarily absent: the Senator 
from Oklahoma (Mr. Coburn).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 63, nays 35, as follows:

                      [Rollcall Vote No. 159 Leg.]

                                YEAS--63

     Akaka
     Baucus
     Begich
     Bennet
     Bingaman
     Blumenthal
     Boxer
     Brown (MA)
     Brown (OH)
     Burr
     Cardin
     Carper
     Casey
     Chambliss
     Cochran
     Collins
     Conrad
     Coons
     Crapo
     Durbin
     Feinstein
     Franken
     Gillibrand
     Graham
     Grassley
     Hagan
     Harkin
     Hoeven
     Isakson
     Johanns
     Johnson (SD)
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Manchin
     Menendez
     Merkley
     Mikulski
     Nelson (NE)
     Nelson (FL)
     Portman
     Pryor
     Reed
     Reid
     Risch
     Rockefeller
     Sanders
     Schumer
     Sessions
     Shelby
     Snowe
     Stabenow
     Tester
     Udall (CO)
     Udall (NM)
     Warner
     Webb
     Whitehouse
     Wyden

                                NAYS--35

     Alexander
     Ayotte
     Barrasso
     Blunt
     Boozman
     Cantwell
     Coats
     Corker
     Cornyn
     DeMint
     Enzi
     Hatch
     Heller
     Hutchison
     Inhofe
     Inouye
     Johnson (WI)
     Kirk
     Kyl
     Lee
     Lieberman
     Lugar
     McCain
     McCaskill
     McConnell
     Moran
     Murkowski
     Murray
     Paul
     Roberts
     Rubio
     Thune
     Toomey
     Vitter
     Wicker

                             NOT VOTING--2

     Coburn
     Shaheen
      
  The bill (S. 1619) was passed, as follows:

                                S. 1619

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Currency Exchange Rate 
     Oversight Reform Act of 2011''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Administering authority.--The term ``administering 
     authority'' means the authority referred to in section 771(1) 
     of the Tariff Act of 1930 (19 U.S.C. 1677(1)).
       (2) Agreement on government procurement.--The term 
     ``Agreement on Government Procurement'' means the agreement 
     referred to in section 101(d)(17) of the Uruguay Round 
     Agreements Act (19 U.S.C. 3511(d)(17)).
       (3) Country.--The term ``country'' means a foreign country, 
     dependent territory, or possession of a foreign country, and 
     may include an association of 2 or more foreign countries, 
     dependent territories, or possessions of countries into a 
     customs union outside the United States.
       (4) Exporting country.--The term ``exporting country'' 
     means the country in which the subject merchandise is 
     produced or manufactured.
       (5) Fundamental misalignment.--The term ``fundamental 
     misalignment'' means a significant and sustained 
     undervaluation of the prevailing real effective exchange 
     rate, adjusted for cyclical and transitory factors, from its 
     medium-term equilibrium level.
       (6) Fundamentally misaligned currency.--The term 
     ``fundamentally misaligned currency'' means a foreign 
     currency that is in fundamental misalignment.
       (7) Real effective exchange rate.--The term ``real 
     effective exchange rate'' means a weighted average of 
     bilateral exchange rates, expressed in price-adjusted terms.
       (8) Secretary.--The term ``Secretary'' means the Secretary 
     of the Treasury.
       (9) Sterilization.--The term ``sterilization'' means 
     domestic monetary operations taken to neutralize the monetary 
     impact of increases in reserves associated with intervention 
     in the currency exchange market.
       (10) Subject merchandise.--The term ``subject merchandise'' 
     means the merchandise subject to an antidumping 
     investigation, review, suspension agreement, or order 
     referred to in section 771(25) of the Tariff Act of 1930 (19 
     U.S.C. 1677(25)).
       (11) WTO agreement.--The term ``WTO Agreement'' means the 
     agreement referred to in section 2(9) of the Uruguay Round 
     Agreements Act (19 U.S.C. 3501(9)).

     SEC. 3. REPORT ON INTERNATIONAL MONETARY POLICY AND CURRENCY 
                   EXCHANGE RATES.

       (a) Reports Required.--
       (1) In general.--Not later than March 15 and September 15 
     of each calendar year, the Secretary, after consulting with 
     the Chairman of the Board of Governors of the Federal Reserve 
     System and the Advisory Committee on International Exchange 
     Rate Policy, shall submit to Congress and make public, a 
     written report on international monetary policy and currency 
     exchange rates.
       (2) Consultations.--On or before March 30 and September 30 
     of each calendar year, the Secretary shall appear, if 
     requested, before the Committee on Banking, Housing, and 
     Urban Affairs and the Committee on Finance of the Senate and 
     the Committee on Financial Services and the Committee on Ways 
     and Means of the House of Representatives to provide 
     testimony on the reports submitted pursuant to paragraph (1).
       (b) Content of Reports.--Each report submitted under 
     subsection (a) shall contain the following:
       (1) An analysis of currency market developments and the 
     relationship between the United States dollar and the 
     currencies of major economies and trading partners of the 
     United States.
       (2) A review of the economic and monetary policies of major 
     economies and trading partners of the United States, and an 
     evaluation of how such policies impact currency exchange 
     rates.
       (3) A description of any currency intervention by the 
     United States or other major economies or trading partners of 
     the United States, or other actions undertaken to adjust the 
     actual exchange rate relative to the United States dollar.
       (4) An evaluation of the domestic and global factors that 
     underlie the conditions in the currency markets, including--
       (A) monetary and financial conditions;
       (B) accumulation of foreign assets;
       (C) macroeconomic trends;
       (D) trends in current and financial account balances;
       (E) the size, composition, and growth of international 
     capital flows;
       (F) the impact of the external sector on economic growth;
       (G) the size and growth of external indebtedness;
       (H) trends in the net level of international investment; 
     and
       (I) capital controls, trade, and exchange restrictions.
       (5) A list of currencies designated as fundamentally 
     misaligned currencies pursuant to section 4(a)(2), and a 
     description of any economic models or methodologies used to 
     establish the list.
       (6) A list of currencies designated for priority action 
     pursuant to section 4(a)(3).
       (7) An identification of the nominal value associated with 
     the medium-term equilibrium exchange rate, relative to the 
     United States dollar, for each currency listed under 
     paragraph (6).
       (8) A description of any consultations conducted or other 
     steps taken pursuant to section 5, 6, or 7, including any 
     actions taken to eliminate the fundamental misalignment.
       (9) A description of any determination made pursuant to 
     section 9(a).
       (c) Consultations.--The Secretary shall consult with the 
     Chairman of the Board of Governors of the Federal Reserve 
     System and the Advisory Committee on International Exchange 
     Rate Policy with respect to the preparation of each report 
     required under subsection (a). Any comments provided by the 
     Chairman of the Board of Governors of the Federal Reserve 
     System or the Advisory Committee on International Exchange 
     Rate Policy shall be submitted to the Secretary not later 
     than the date that is 15 days before the date each report is 
     due under subsection (a). The Secretary shall submit the 
     report to Congress after taking into account all comments 
     received from the Chairman and the Advisory Committee.

     SEC. 4. IDENTIFICATION OF FUNDAMENTALLY MISALIGNED 
                   CURRENCIES.

       (a) Identification.--
       (1) In general.--The Secretary shall analyze on a 
     semiannual basis the prevailing real effective exchange rates 
     of foreign currencies.
       (2) Designation of fundamentally misaligned currencies.--
     With respect to the currencies of countries that have 
     significant bilateral trade flows with the United States, and 
     currencies that are otherwise significant to the operation, 
     stability, or orderly development of regional or global 
     capital markets, the Secretary shall determine whether any 
     such currency is in fundamental misalignment and shall 
     designate such currency as a fundamentally misaligned 
     currency.
       (3) Designation of currencies for priority action.--The 
     Secretary shall designate a currency identified under 
     paragraph (2) for priority action if the country that issues 
     such currency is--

[[Page 15091]]

       (A) engaging in protracted large-scale intervention in the 
     currency exchange market, particularly if accompanied by 
     partial or full sterilization;
       (B) engaging in excessive and prolonged official or quasi-
     official accumulation of foreign exchange reserves and other 
     foreign assets, for balance of payments purposes;
       (C) introducing or substantially modifying for balance of 
     payments purposes a restriction on, or incentive for, the 
     inflow or outflow of capital, that is inconsistent with the 
     goal of achieving full currency convertibility; or
       (D) pursuing any other policy or action that, in the view 
     of the Secretary, warrants designation for priority action.
       (b) Reports.--The Secretary shall include a list of any 
     foreign currency designated under paragraph (2) or (3) of 
     subsection (a) and the data and reasoning underlying such 
     designations in each report required by section 3.

     SEC. 5. NEGOTIATIONS AND CONSULTATIONS.

       (a) In General.--Upon designation of a currency pursuant to 
     section 4(a)(2), the Secretary shall seek to consult 
     bilaterally with the country that issues such currency in 
     order to facilitate the adoption of appropriate policies to 
     address the fundamental misalignment.
       (b) Consultations Involving Currencies Designated for 
     Priority Action.--With respect to each currency designated 
     for priority action pursuant to section 4(a)(3), the 
     Secretary shall, in addition to seeking to consult with a 
     country pursuant to subsection (a)--
       (1) seek the advice of the International Monetary Fund with 
     respect to the Secretary's findings in the report submitted 
     to Congress pursuant to section 3(a); and
       (2) encourage other governments, whether bilaterally or in 
     appropriate multinational fora, to join the United States in 
     seeking the adoption of appropriate policies by the country 
     described in subsection (a) to eliminate the fundamental 
     misalignment.

     SEC. 6. FAILURE TO ADOPT APPROPRIATE POLICIES.

       (a) In General.--Not later than 90 days after the date on 
     which a currency is designated for priority action pursuant 
     to section 4(a)(3), the Secretary shall determine whether the 
     country that issues such currency has adopted appropriate 
     policies, and taken identifiable action, to eliminate the 
     fundamental misalignment. The Secretary shall promptly notify 
     Congress of such determination and publish notice of the 
     determination in the Federal Register. If the Secretary 
     determines that the country that issues such currency has 
     failed to adopt appropriate policies, or take identifiable 
     action, to eliminate the fundamental misalignment, the 
     following shall apply with respect to the country until a 
     notification described in section 7(b) is published in the 
     Federal Register:
       (1) Adjustment under antidumping law.--For purposes of an 
     antidumping investigation under subtitle B of title VII of 
     the Tariff Act of 1930 (19 U.S.C. 1673 et seq.), or a review 
     under subtitle C of such Act (19 U.S.C. 1675 et seq.), the 
     following shall apply:
       (A) In general.--The administering authority shall ensure a 
     fair comparison between the export price and the normal value 
     by adjusting the price used to establish export price or 
     constructed export price to reflect the fundamental 
     misalignment of the currency of the exporting country.
       (B) Sales subject to adjustment.--The adjustment described 
     in subparagraph (A) shall apply with respect to subject 
     merchandise sold on or after the date that is 30 days after 
     the date the currency of the exporting country is designated 
     for priority action pursuant to section 4(a)(3).
       (2) Federal procurement.--
       (A) In general.--The President shall prohibit the 
     procurement by the Federal Government of products or services 
     from the country.
       (B) Exception.--The prohibition provided for in 
     subparagraph (A) shall not apply with respect to a country 
     that is a party to the Agreement on Government Procurement.
       (3) Request for imf action.--The United States shall inform 
     the Managing Director of the International Monetary Fund of 
     the failure of the country to adopt appropriate policies, or 
     to take identifiable action, to eliminate the fundamental 
     misalignment, and the actions the country is engaging in that 
     are identified in section 4(a)(3), and shall request that the 
     Managing Director of the International Monetary Fund--
       (A) consult with such country regarding the observance of 
     the country's obligations under article IV of the 
     International Monetary Fund Articles of Agreement, including 
     through special consultations, if necessary; and
       (B) formally report the results of such consultations to 
     the Executive Board of the International Monetary Fund within 
     180 days of the date of such request.
       (4) OPIC financing.--The Overseas Private Investment 
     Corporation shall not approve any new financing (including 
     insurance, reinsurance, or guarantee) with respect to a 
     project located within the country.
       (5) Multilateral bank financing.--
       (A) In general.--The Secretary shall instruct the United 
     States Executive Director at each multilateral bank to oppose 
     the approval of any new financing (including loans, other 
     credits, insurance, reinsurance, or guarantee) to the 
     government of the country or for a project located within the 
     country.
       (B) Multilateral bank.--The term ``multilateral bank'' 
     includes each of the international financial institutions 
     described in section 1701(c)(2) of the International 
     Financial Institutions Act (22 U.S.C. 262r).
       (b) Waiver.--
       (1) In general.--The President may waive any action 
     provided for under subsection (a) if the President determines 
     that--
       (A) taking such action would cause serious harm to the 
     national security of the United States; or
       (B) it is in the vital economic interest of the United 
     States to do so and taking such action would have an adverse 
     impact on the United States economy greater than the benefits 
     of such action.
       (2) Notification.--The President shall promptly notify 
     Congress of a determination under paragraph (1) (and the 
     reasons for the determination, if made under paragraph 
     (1)(B)) and shall publish notice of the determination (and 
     the reasons for the determination, if made under paragraph 
     (1)(B)) in the Federal Register.
       (c) Reports.--The Secretary shall describe any action or 
     determination pursuant to subsection (a) or (b) in the first 
     semiannual report required by section 3 after the date of 
     such action or determination.

     SEC. 7. PERSISTENT FAILURE TO ADOPT APPROPRIATE POLICIES.

       (a) Persistent Failure To Adopt Appropriate Policies.--Not 
     later than 360 days after the date on which a currency is 
     designated for priority action pursuant to section 4(a)(3), 
     the Secretary shall determine whether the country that issues 
     such currency has adopted appropriate policies, and taken 
     identifiable action, to eliminate the fundamental 
     misalignment. The Secretary shall promptly notify Congress of 
     such determination and shall publish notice of the 
     determination in the Federal Register. If the Secretary 
     determines that the country that issues such currency has 
     failed to adopt appropriate policies, or take identifiable 
     action, to eliminate the fundamental misalignment, in 
     addition to the actions described in section 6(a), the 
     following shall apply with respect to the country until a 
     notification described in subsection (b) is published in the 
     Federal Register:
       (1) Action at the wto.--The United States Trade 
     Representative shall request consultations in the World Trade 
     Organization with the country regarding the consistency of 
     the country's actions with its obligations under the WTO 
     Agreement.
       (2) Remedial intervention.--
       (A) In general.--The Secretary shall consult with the Board 
     of Governors of the Federal Reserve System to consider 
     undertaking remedial intervention in international currency 
     markets in response to the fundamental misalignment of the 
     currency designated for priority action, and coordinating 
     such intervention with other monetary authorities and the 
     International Monetary Fund. In doing so, the Secretary shall 
     consider the impact of such intervention on domestic economic 
     growth and stability, including the impact on interest rates.
       (B) Notice to country.--At the same time the Secretary 
     takes action under subparagraph (A), the Secretary shall 
     notify the country that issues such currency of the 
     consultations under subparagraph (A).
       (b) Notification.--The Secretary shall promptly notify 
     Congress when a country that issues a currency designated for 
     priority action pursuant to section 4(a)(3) adopts 
     appropriate policies, or takes identifiable action, to 
     eliminate the fundamental misalignment, and publish notice of 
     the action of that country in the Federal Register.
       (c) Waiver.--
       (1) In general.--The President may waive any action 
     provided for under this section, or extend any waiver 
     provided for under section 6(b), if the President determines 
     that--
       (A) taking such action would cause serious harm to the 
     national security of the United States; or
       (B) it is in the vital economic interest of the United 
     States to do so, and that taking such action would have an 
     adverse impact on the United States economy substantially out 
     of proportion to the benefits of such action.
       (2) Notification.--The President shall promptly notify 
     Congress of a determination under paragraph (1) (and the 
     reasons for the determination, if made under paragraph 
     (1)(B)) and shall publish notice of the determination (and 
     the reasons for the determination, if made under paragraph 
     (1)(B)) in the Federal Register.
       (d) Disapproval of Waiver.--If the President waives an 
     action pursuant to subsection (c)(1)(B), or extends a waiver 
     provided for under section 6(b)(1)(B), the waiver shall cease 
     to have effect upon the enactment of a resolution of 
     disapproval described in section 8(a)(2).
       (e) Reports.--The Secretary shall describe any action or 
     determination pursuant to subsection (a), (b), or (c) in the 
     first semiannual report required by section 3 after the date 
     of such action or determination.

     SEC. 8. CONGRESSIONAL DISAPPROVAL OF WAIVER.

       (a) Resolution of Disapproval.--

[[Page 15092]]

       (1) Introduction.--If a resolution of disapproval is 
     introduced in the House of Representatives or the Senate 
     during the 90-day period (not counting any day which is 
     excluded under section 154(b)(1) of the Trade Act of 1974 (19 
     U.S.C. 2194(b)(1))), beginning on the date on which the 
     President first notifies Congress of a determination to waive 
     action with respect to a country pursuant to section 
     7(c)(1)(B), that resolution of disapproval shall be 
     considered in accordance with this subsection.
       (2) Resolution of disapproval.--In this subsection, the 
     term ``resolution of disapproval'' means only a joint 
     resolution of the two Houses of the Congress, the sole matter 
     after the resolving clause of which is as follows: ``That 
     Congress does not approve the determination of the President 
     under ___________ of the Currency Exchange Rate Oversight 
     Reform Act of 2011 with respect to ______, of which Congress 
     was notified on _____.'', with the first blank space being 
     filled section 7(c)(1)(B) or section 6(b)(1)(B), whichever is 
     applicable, the second blank space being filled with the name 
     of the appropriate country, and the third blank space being 
     filled with the appropriate date.
       (3) Procedures for considering resolutions.--
       (A) Introduction and referral.--Resolutions of 
     disapproval--
       (i) in the House of Representatives--

       (I) may be introduced by any Member of the House;
       (II) shall be referred to the Committee on Financial 
     Services and, in addition, to the Committee on Rules; and
       (III) may not be amended by either Committee; and

       (ii) in the Senate--

       (I) may be introduced by any Member of the Senate;
       (II) shall be referred to the Committee on Banking, 
     Housing, and Urban Affairs; and
       (III) may not be amended.

       (B) Committee discharge and floor consideration.--The 
     provisions of subsections (c) through (f) of section 152 of 
     the Trade Act of 1974 (other than paragraph (3) of such 
     subsection (f)) (19 U.S.C. 2192 (c) through (f)) (relating to 
     committee discharge and floor consideration of certain 
     resolutions in the House and Senate) apply to a resolution of 
     disapproval under this section to the same extent as such 
     subsections apply to joint resolutions under such section 
     152.
       (b) Rules of House of Representatives and Senate.--This 
     section is enacted by Congress--
       (1) as an exercise of the rulemaking power of the House of 
     Representatives and the Senate, respectively, and as such is 
     deemed a part of the rules of each House, respectively, and 
     the rules provided for in this section supersede other rules 
     only to the extent that they are inconsistent with such other 
     rules; and
       (2) with the full recognition of the constitutional right 
     of either House to change the rules provided for in this 
     section (so far as relating to the procedures of that House) 
     at any time, in the same manner, and to the same extent as 
     any other rule of that House.

     SEC. 9. INTERNATIONAL FINANCIAL INSTITUTION GOVERNANCE 
                   ARRANGEMENTS.

       (a) Initial Review.--Notwithstanding any other provision of 
     law, before the United States approves a proposed change in 
     the governance arrangement of any international financial 
     institution, as defined in section 1701(c)(2) of the 
     International Financial Institutions Act (22 U.S.C. 
     262r(c)(2)), the Secretary shall determine whether any member 
     of the international financial institution that would benefit 
     from the proposed change, in the form of increased voting 
     shares or representation, has a currency that was designated 
     a currency for priority action pursuant to section 4(a)(3) in 
     the most recent report required by section 3. The 
     determination shall be reported to Congress.
       (b) Subsequent Action.--The United States shall oppose any 
     proposed change in the governance arrangement of the 
     international financial institution (described in subsection 
     (a)), if the Secretary renders an affirmative determination 
     pursuant to subsection (a).
       (c) Further Action.--The United States shall continue to 
     oppose any proposed change in the governance arrangement of 
     the international financial institution, pursuant to 
     subsection (b), until the Secretary determines and reports to 
     Congress that the proposed change would not benefit any 
     member of the international financial institution, in the 
     form of increased voting shares or representation, that has a 
     currency that is designated a currency for priority action 
     pursuant to section 4(a)(3).

     SEC. 10. ADJUSTMENT FOR FUNDAMENTALLY MISALIGNED CURRENCY 
                   DESIGNATED FOR PRIORITY ACTION.

       (a) In General.--Subsection (c)(2) of section 772 of the 
     Tariff Act of 1930 (19 U.S.C. 1677a(c)(2)) is amended--
       (1) by striking ``and'' at the end of subparagraph (A);
       (2) by striking the period at the end of subparagraph (B) 
     and inserting ``, and''; and
       (3) by adding at the end the following:
       ``(C) if required by section 6(a)(1) of the Currency 
     Exchange Rate Oversight Reform Act of 2011, the percentage by 
     which the domestic currency of the producer or exporter is 
     undervalued in relation to the United States dollar as 
     determined under section 771(37).''.
       (b) Calculation Methodology.--Section 771 of the Tariff Act 
     of 1930 (19 U.S.C. 1677) is amended by adding at the end the 
     following:
       ``(37) Percentage undervaluation.--The administering 
     authority shall determine the percentage by which the 
     domestic currency of the producer or exporter is undervalued 
     in relation to the United States dollar by comparing the 
     nominal value associated with the medium-term equilibrium 
     exchange rate of the domestic currency of the producer or 
     exporter, identified by the Secretary pursuant to section 
     3(b)(7) of the Currency Exchange Rate Oversight Reform Act of 
     2011, to the official daily exchange rate identified by the 
     administering authority.''.

     SEC. 11. CURRENCY UNDERVALUATION UNDER COUNTERVAILING DUTY 
                   LAW.

       (a) Investigation or Review.--Subsection (c) of section 702 
     of the Tariff Act of 1930 (19 U.S.C. 1671a(c)) is amended by 
     adding at the end the following:
       ``(6) Currency undervaluation.--For purposes of a 
     countervailing duty investigation under this subtitle where 
     the determinations under clauses (i) and (ii) of paragraph 
     (1)(A) are affirmative, or a review under subtitle C of this 
     title, the following shall apply:
       ``(A) In general.--The administering authority shall 
     initiate an investigation to determine whether currency 
     undervaluation by the government of a country or any public 
     entity within the territory of a country is providing, 
     directly or indirectly, a countervailable subsidy as 
     described in section 771(5), if--
       ``(i) a petition filed by an interested party (described in 
     subparagraph (C), (D), (E), (F), or (G) of section 771(9)) 
     alleges the elements necessary for the imposition of the duty 
     imposed by section 701(a); and
       ``(ii) the petition is accompanied by information 
     reasonably available to the petitioner supporting those 
     allegations.
       ``(B) Designation of fundamentally misaligned currency for 
     priority action.--Upon designation of a currency as a 
     fundamentally misaligned currency for priority action 
     pursuant to section 4(a)(3) of the Currency Exchange Rate 
     Oversight Reform Act of 2011, the administering authority 
     shall initiate an investigation to determine whether the 
     country that issues such currency is providing, directly or 
     indirectly, a countervailable subsidy as defined in section 
     771(5), if--
       ``(i) a petition filed by an interested party (described in 
     subparagraph (C), (D), (E), (F), or (G) of section 771(9)) 
     alleges the elements necessary for the imposition of the duty 
     imposed by section 701(a); and
       ``(ii) the petition is accompanied by information 
     reasonably available to the petitioner supporting those 
     allegations.''.
       (b) Benefit Calculation Methodology.--Section 771 of the 
     Tariff Act of 1930 (19 U.S.C. 1677), as amended by section 
     10(b), is further amended by adding at the end the following:
       ``(38) Currency undervaluation benefit.--For purposes of a 
     countervailing duty investigation under subtitle A of this 
     title, or a review under subtitle C of this title, the 
     following shall apply:
       ``(A) In general.--If the administering authority 
     determines to investigate whether currency undervaluation is 
     a countervailable subsidy as defined in section 771(5), the 
     administering authority shall determine whether there is a 
     benefit to the recipient and measure such benefit by 
     comparing the simple average of the real exchange rates 
     derived from application of the macroeconomic-balance 
     approach and the equilibrium-real-exchange-rate approach to 
     the official daily exchange rate identified by the 
     administering authority. The administering authority shall 
     rely upon data that are publicly available, reliable, and 
     compiled and maintained by the International Monetary Fund or 
     the World Bank, or other international organizations or 
     national governments if International Monetary Fund or World 
     Bank data is not available.
       ``(B) Designation of fundamentally misaligned currency for 
     priority action.--In the case of designation of a currency as 
     a fundamentally misaligned currency for priority action 
     pursuant to section 4(a)(3) of the Currency Exchange Rate 
     Oversight Reform Act of 2011, the administering authority 
     shall determine whether there is a benefit to the recipient 
     and measure such benefit by comparing the nominal value 
     associated with the medium-term equilibrium exchange rate of 
     the currency of the exporting country, identified by the 
     Secretary pursuant to section 3(b)(7) of such Act, to the 
     official daily exchange rate identified by the administering 
     authority.
       ``(C) Definitions.--
       ``(i) Macroeconomic-balance approach.--The term 
     `macroeconomic-balance approach' means a methodology under 
     which the level of undervaluation of the real effective 
     exchange rate of the exporting country's currency is defined 
     as the change in the real effective exchange rate needed to 
     achieve equilibrium in the exporting country's balance of 
     payments, as such methodology is described in the guidelines 
     of the International Monetary Fund's Consultative Group on 
     Exchange Rate Issues, if available.

[[Page 15093]]

       ``(ii) Equilibrium-real-exchange-rate approach.--The term 
     `equilibrium-real-exchange-rate approach' means a methodology 
     under which the level of undervaluation of the real effective 
     exchange rate of the exporting country's currency is defined 
     as the difference between the observed real effective 
     exchange rate and the real effective exchange rate, as such 
     methodology is described in the guidelines of the 
     International Monetary Fund's Consultative Group on Exchange 
     Rate Issues, if available.
       ``(iii) Real exchange rates.--The term `real exchange 
     rates' means the bilateral exchange rates derived from 
     converting the trade-weighted multilateral exchange rates 
     yielded by the macroeconomic-balance approach and the 
     equilibrium-real-exchange-rate approach into real bilateral 
     terms.''.
       (c) Export Subsidy.--Section 771(5A)(B) of the Tariff Act 
     of 1930 (19 U.S.C. 1677(5A)(B)) is amended by adding at the 
     end the following new sentence: ``The fact that a subsidy may 
     also be provided in circumstances that do not involve export 
     shall not, for that reason alone, mean that the subsidy 
     cannot be considered contingent upon export performance.''.
       (d) Effective Date.--The amendments made by this section 
     apply to countervailing duty investigations initiated under 
     subtitle A of title VII of the Tariff Act of 1930 (19 U.S.C. 
     1671 et seq.) and reviews initiated under subtitle C of title 
     VII of such Act (19 U.S.C. 1675 et seq.) before, on, or after 
     the date of the enactment of this Act.

     SEC. 12. NONMARKET ECONOMY STATUS.

       Paragraph (18)(B) of section 771 of the Tariff Act of 1930 
     (19 U.S.C. 1677(18)(B)) is amended--
       (1) by striking ``and'' at the end of clause (v); and
       (2) by redesignating clause (vi) as clause (vii) and 
     inserting after clause (v) the following:
       ``(vi) whether the currency of the foreign country is 
     designated, or has been designated at any time over the 5 
     years prior to review of nonmarket economy status, a currency 
     for priority action pursuant to section 4(a)(3) of the 
     Currency Exchange Rate Oversight Reform Act of 2011, and''.

     SEC. 13. APPLICATION TO CANADA AND MEXICO.

       Pursuant to article 1902 of the North American Free Trade 
     Agreement and section 408 of the North American Free Trade 
     Agreement Implementation Act (19 U.S.C. 3438), section 
     6(a)(1) and the amendments made by sections 10, 11, and 12 
     shall apply with respect to goods from Canada and Mexico.

     SEC. 14. ADVISORY COMMITTEE ON INTERNATIONAL EXCHANGE RATE 
                   POLICY.

       (a) Establishment.--
       (1) In general.--There is established an Advisory Committee 
     on International Exchange Rate Policy (in this section 
     referred to as the ``Committee''). The Committee shall be 
     responsible for--
       (A) advising the Secretary in the preparation of each 
     report to Congress on international monetary policy and 
     currency exchange rates, provided for in section 3; and
       (B) advising Congress and the President with respect to--
       (i) international exchange rates and financial policies; 
     and
       (ii) the impact of such policies on the economy of the 
     United States.
       (2) Membership.--
       (A) In general.--The Committee shall be composed of 9 
     members as follows, none of whom shall be employees of the 
     Federal Government:
       (i) Congressional appointees.--

       (I) Senate appointees.--Four persons shall be appointed by 
     the President pro tempore of the Senate, upon the 
     recommendation of the chairmen and ranking members of the 
     Committee on Banking, Housing, and Urban Affairs and the 
     Committee on Finance of the Senate.
       (II) House appointees.--Four persons shall be appointed by 
     the Speaker of the House of Representatives upon the 
     recommendation of the chairmen and ranking members of the 
     Committee on Financial Services and the Committee on Ways and 
     Means of the House of Representatives.

       (ii) Presidential appointee.--One person shall be appointed 
     by the President.
       (B) Qualifications.--Persons shall be selected under 
     subparagraph (A) on the basis of their objectivity and 
     demonstrated expertise in finance, economics, or currency 
     exchange.
       (3) Terms.--Members shall be appointed for a term of 4 
     years or until the Committee terminates. An individual may be 
     reappointed to the Committee for additional terms.
       (4) Vacancies.--Any vacancy in the Committee shall not 
     affect its powers, but shall be filled in the same manner as 
     the original appointment.
       (b) Duration of Committee.--Notwithstanding section 14(c) 
     of the Federal Advisory Committee Act (5 U.S.C. App.), the 
     Committee shall terminate on the date that is 4 years after 
     the date of the enactment of this Act unless renewed by the 
     President pursuant to section 14 of the Federal Advisory 
     Committee Act (5 U.S.C. App.) for a subsequent 4-year period. 
     The President may continue to renew the Committee for 
     successive 4-year periods by taking appropriate action prior 
     to the date on which the Committee would otherwise terminate.
       (c) Public Meetings.--The Committee shall hold at least 2 
     public meetings each year for the purpose of accepting public 
     comments, including comments from small business owners. The 
     Committee shall also meet as needed at the call of the 
     Secretary or at the call of two-thirds of the members of the 
     Committee.
       (d) Chairperson.--The Committee shall elect from among its 
     members a chairperson for a term of 4 years or until the 
     Committee terminates. A chairperson of the Committee may be 
     reelected chairperson but is ineligible to serve consecutive 
     terms as chairperson.
       (e) Staff.--The Secretary shall make available to the 
     Committee such staff, information, personnel, administrative 
     services, and assistance as the Committee may reasonably 
     require to carry out its activities.
       (f) Application of Federal Advisory Committee Act.--
       (1) In general.--The provisions of the Federal Advisory 
     Committee Act (5 U.S.C. App.) shall apply to the Committee.
       (2) Exception.--Except for the 2 annual public meetings 
     required under subsection (c), meetings of the Committee 
     shall be exempt from the requirements of subsections (a) and 
     (b) of sections 10 and 11 of the Federal Advisory Committee 
     Act (relating to open meetings, public notice, public 
     participation, and public availability of documents), 
     whenever and to the extent it is determined by the President 
     or the Secretary that such meetings will be concerned with 
     matters the disclosure of which would seriously compromise 
     the development by the United States Government of monetary 
     and financial policy.

     SEC. 15. REPEAL OF THE EXCHANGE RATES AND ECONOMIC POLICY 
                   COORDINATION ACT OF 1988.

       The Exchange Rates and International Economic Policy 
     Coordination Act of 1988 (22 U.S.C. 5301 et seq.) is 
     repealed.

  Mr. UDALL of Colorado. Mr. President, I rise to discuss the recent 
vote on the Currency Exchange Rate Oversight Reform Act of 2011 that 
just passed in the Senate. The issue of currency misalignment and 
manipulation has brought to the surface a myriad of concerns that face 
our country's workers and businesses.
  Coloradans are concerned that American businesses and producers are 
unable to compete fairly in the global marketplace when foreign 
countries keep the value of their currency artificially low. Those who 
have both supported and opposed this legislation agree that the 
artificial undervaluation of foreign currency has had a negative impact 
on the competitiveness of U.S. exports and that it needs to be 
remedied. In the case of China, numerous economists have estimated that 
its currency is undervalued by anywhere from 12 to 50 percent. The 
International Monetary Fund and the U.S. Treasury are also among those 
who have determined that the undervaluation of Chinese currency is 
real.
  The implications of this artificial undervaluation include a 
detrimental effect on the competiveness of U.S. products abroad, making 
Chinese products artificially cheaper than U.S. products. The National 
Association of Manufacturers has affirmed ``that the excessive 
valuation of the dollar [relative to foreign currencies] simply prices 
U.S. exports out of the market.'' They highlight that their members 
``have made it clear that the number-one factor affecting their exports 
is the value of the dollar.''
  We can agree that artificial undervaluation of currency is a serious 
problem that harms our economy, our worldwide competitiveness, and our 
American workers. And it needs to be addressed. Yet the principle 
challenge here has been how we should ultimately go about making sure 
our economic partners, such as China, are honoring shared commitments 
to compete on a level playing field.
  I understand the concerns of both sides in this debate and I know 
that many American businesses that have a presence in China and across 
our globe are concerned about the potential for retaliatory action from 
China. These companies, many of which also face ongoing issues of 
inadequate protection of intellectual property, discriminatory 
indigenous innovation and other industrial policies that limit access 
to Chinese markets, are understandably worried that China would further 
restrict their markets to fair competition.
  I have also heard the frustration of domestic producers and U.S. 
workers

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who, together, produce a whole host of products in the U.S. and have 
felt the direct effect of being unable to compete fairly due to the 
discounting effect that China's currency undervaluation has on Chinese 
imports.
  All of these concerns are valid, and despite some of my Senate 
colleagues' disagreement on whether to support the legislation that 
came before us, the common denominator in this debate has been a desire 
for fairness. And I believe that we will move closer to achieving 
fairness in the market place with a clearer commitment to a market-
based exchange rate from our trade and economic partners.
  As sovereign nations, we all have the economic well being of our 
respective countries at heart, but that does not justify the use of 
unfair trade practices, and we cannot turn a blind eye when this 
happens. Nor should we allow the specter of a ``trade war'' to distract 
us from the fact that China is not abiding by the international rules 
that were put in place to help prevent trade wars in the first place. 
China agreed to abide by these rules of the international community--
including rules about intellectual property rights and unfair 
restrictions to market access, as well as rules against intentional 
currency misalignment--and we should not accept their adherence to 
certain rules but not others. They all apply.
  After taking a closer look at the issue of China's currency 
undervaluation, taking into consideration the concerns that I have 
heard on this issue from a range of Coloradans, and reviewing the 
legislative proposal that was before us, I believed that the U.S. 
Senate needed to send a signal to China, and others who may be 
intentionally undervaluing their currencies. The message is that 
Americans value playing by the rules and that we expect our trade 
partners to live up to our shared commitment to compete fairly in the 
global marketplace.
  I ultimately came to the conclusion that this bipartisan legislation, 
known as the Currency Exchange Rate Oversight Reform Act of 2011, was 
an appropriate way to send a signal that we are serious about working 
bilaterally and/or multilaterally, in a manner consistent with World 
Trade Organization agreements, to develop a responsible plan so that 
currencies identified as fundamentally misaligned can be valued 
appropriately based on relevant market factors. In the event that the 
misaligned currency goes unresolved, the legislation also authorizes 
the administration to take action to protect American businesses and 
workers from the discounting effect that the undervaluation of the 
currency can have on imports from the respective country. I believe 
that the mechanisms built into this legislation can promote a 
collaborative effort to address any undervaluation of a foreign 
currency, while also sending the message that we cannot allow American 
businesses to be undercut.
  My choice to support this legislation aligns best with the common 
sense and pragmatic thinking of Coloradans. Unfortunately, China 
continues to characterize efforts on the part of the United States to 
ensure a level playing field for international trade as 
``protectionist.'' Supporting fair competition, fair access to markets 
and fulfillment of the commitments of our shared expectations among 
economic and trade partners is far from protectionist. As former 
President Ronald Reagan once stated, ``To make the international 
trading system work, all must abide by the rules.'' I urge China to act 
in good faith and to remain committed to reaching economic stability 
through cooperative action that encourages fair competition. The 
legislation I just supported is one component to reaching that goal, 
and I believe it supports the American businesses and workers who are 
propelling our nation to continue to be the leader in the global 
economic race.
  Mr. WARNER. Mr. President, I rise today to discuss S. 1619, known as 
the China Currency bill. I voted for that bill today because China has 
not made the progress that the U.S. and other countries have sought on 
currency issues. These currency issues can lead to economic distortions 
that cost the American economy jobs and increase economic risks for the 
global economy. Ideally, we would address these problems through 
negotiations with China and some other countries, but that course that 
has not yet yielded significant results. I hope we will make better 
progress on these currency issues in the future, and then perhaps 
legislation such as this won't be necessary. This bill is not perfect; 
ideally it would more clearly distinguish countries with unhelpful 
currency policies, from those which have taken a more measured course 
in managing their economies and currency. I would rather not resort to 
sanctions or countervailing duties, but the lack of progress on 
currency issues has made it appropriate to consider the steps set forth 
in this bill. While the final version of this legislation is not 
precisely as I would have written it, it is appropriate for the 
Congress to be heard on this issue, so tonight I voted for this bill. I 
hope that in the near future, we can resolve all of our currency issues 
with China and other nations.

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