[Congressional Record (Bound Edition), Volume 157 (2011), Part 11]
[House]
[Pages 15195-15208]
[From the U.S. Government Publishing Office, www.gpo.gov]




      UNITED STATES-KOREA FREE TRADE AGREEMENT IMPLEMENTATION ACT

  Mr. CAMP. Madam Speaker, pursuant to House Resolution 425, I call up 
the bill (H.R. 3080) to implement the United States-Korea Free Trade 
Agreement, and ask for its immediate consideration.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore. Pursuant to House Resolution 425, the bill 
is considered read.
  The text of the bill is as follows:

                               H.R. 3080

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

     SECTION 1. SHORT TITLE.

       (a) Short Title.--This Act may be cited as the ``United 
     States-Korea Free Trade Agreement Implementation Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:
Sec. 1. Short title.
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.
Sec. 202. Rules of origin.
Sec. 203. Customs user fees.
Sec. 204. Disclosure of incorrect information; false certifications of 
              origin; denial of preferential tariff treatment.
Sec. 205. Reliquidation of entries.
Sec. 206. Recordkeeping requirements.
Sec. 207. Enforcement relating to trade in textile or apparel goods.
Sec. 208. Regulations.

                     TITLE III--RELIEF FROM IMPORTS

Sec. 301. Definitions.

     Subtitle A--Relief From Imports Benefitting 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--Motor Vehicle Safeguard Measures

Sec. 321. Motor vehicle safeguard measures.

           Subtitle C--Textile and Apparel Safeguard Measures

Sec. 331. Commencement of action for relief.
Sec. 332. Determination and provision of relief.
Sec. 333. Period of relief.
Sec. 334. Articles exempt from relief.
Sec. 335. Rate after termination of import relief.
Sec. 336. Termination of relief authority.
Sec. 337. Compensation authority.
Sec. 338. Confidential business information.

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

Sec. 341. Findings and action on Korean articles.

                         TITLE IV--PROCUREMENT

Sec. 401. Eligible products.

                            TITLE V--OFFSETS

Sec. 501. Increase in penalty on paid preparers who fail to comply with 
              earned income tax credit due diligence requirements.
Sec. 502. Requirement for prisons located in the United States to 
              provide information for tax administration.
Sec. 503. Rate for merchandise processing fees.
Sec. 504. Extension of customs user fees.
Sec. 505. Time for payment of corporate estimated taxes.

     SEC. 2. PURPOSES.

       The purposes of this Act are--
       (1) to approve and implement the free trade agreement 
     between the United States and Korea 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 secure the benefits of the agreement entered into 
     pursuant to an exchange of letters between the United States 
     and the Government of Korea on February 10, 2011;
       (3) to strengthen and develop economic relations between 
     the United States and Korea for their mutual benefit;
       (4) to establish free trade between the United States and 
     Korea through the reduction and elimination of barriers to 
     trade in goods and services and to investment; and
       (5) to lay the foundation for further cooperation to expand 
     and enhance the benefits of the Agreement.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Agreement.--The term ``Agreement'' means the United 
     States-Korea Free Trade Agreement approved by Congress under 
     section 101(a)(1).
       (2) Commission.--The term ``Commission'' means the United 
     States International Trade Commission.
       (3) HTS.--The term ``HTS'' means the Harmonized Tariff 
     Schedule of the United States.
       (4) Korea.--The term ``Korea'' means the Republic of Korea.
       (5) 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-Korea Free Trade Agreement entered 
     into on June 30, 2007, with the Government of Korea, and 
     submitted to Congress on October 3, 2011; and
       (2) the statement of administrative action proposed to 
     implement the Agreement that was submitted to Congress on 
     October 3, 2011.
       (b) Conditions for Entry Into Force of the Agreement.--At 
     such time as the President determines that Korea has taken 
     measures necessary to comply 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 Korea providing for the 
     entry into force, on

[[Page 15196]]

     or after January 1, 2012, 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 
     on which the Agreement enters into force is appropriately 
     implemented on such date, but no such proclamation or 
     regulation may have an effective date earlier than the date 
     on which the Agreement enters into force.
       (2) Effective date of certain proclaimed actions.--Any 
     action proclaimed by the 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 
     contained 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 on 
     which 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 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 the committees 
     referred to in paragraph (2) 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 
     22 of the Agreement. The office shall 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 
     2011 to the Department of Commerce up to $750,000 for the 
     establishment and operations of the office established or 
     designated under subsection (a) and for the payment of the 
     United States share of the expenses of panels established 
     under chapter 22 of the Agreement.

     SEC. 106. ARBITRATION OF CLAIMS.

       The United States is authorized to resolve any claim 
     against the United States covered by article 11.16.1(a)(i)(C) 
     or article 11.16.1(b)(i)(C) of the Agreement, pursuant to the 
     Investor-State Dispute Settlement procedures set forth in 
     section B of chapter 11 of the Agreement.

     SEC. 107. EFFECTIVE DATES; EFFECT OF TERMINATION.

       (a) Effective Dates.--Except as provided in subsection (b), 
     this Act and the amendments made by this Act take effect on 
     the date on which the Agreement enters into force.
       (b) Exceptions.--
       (1) In general.--Sections 1 through 3, section 207(g), this 
     title, and title V take effect on the date of the enactment 
     of this Act.
       (2) Certain amendatory provisions.--The amendments made by 
     sections 203, 204, 206, and 401 of this Act take effect on 
     the date of the enactment of this Act and apply with respect 
     to Korea on the date on which the Agreement enters into 
     force.
       (c) Termination of the Agreement.--On the date on which the 
     Agreement terminates, this Act (other than this subsection 
     and title V) and the amendments made by this Act (other than 
     the amendments made by title V) shall cease to have effect.

                      TITLE II--CUSTOMS PROVISIONS

     SEC. 201. TARIFF MODIFICATIONS.

       (a) Tariff Modifications Provided for in the Agreement.--
     The President may proclaim--
       (1) such modifications or continuation of any duty,
       (2) such continuation of duty-free or excise treatment, or
       (3) such additional duties,

     as the President determines to be necessary or appropriate to 
     carry out or apply articles 2.3, 2.5, and 2.6, and Annex 2-B, 
     Annex 4-B, and Annex 22-A, 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 Korea regarding the staging of any duty treatment set 
     forth in Annex 2-B of the Agreement,
       (3) such continuation of duty-free or excise treatment, or
       (4) such additional duties,

     as the President determines to be necessary or appropriate to 
     maintain the general level of reciprocal and mutually 
     advantageous concessions with respect to Korea provided for 
     by the Agreement.
       (c) Conversion to Ad Valorem Rates.--For purposes of 
     subsections (a) and (b), with respect to any good for which 
     the base rate in the Schedule of the United States to Annex 
     2-B of the Agreement is a specific or compound rate of duty, 
     the President may substitute for the base rate an ad valorem 
     rate that the President determines to be equivalent to the 
     base rate.
       (d) Tariff Treatment of Motor Vehicles.--The President may 
     proclaim the following tariff treatment with respect to the 
     following motor vehicles of Korea:
       (1) Certain passenger cars.--In the case of originating 
     goods of Korea classifiable under subheading 8703.10.10, 
     8703.10.50, 8703.21.00, 8703.22.00, 8703.23.00, 8703.24.00, 
     8703.31.00, 8703.32.00, or 8703.33.00 of the HTS that are 
     entered, or withdrawn from warehouse for consumption--
       (A) the rate of duty for such goods shall be 2.5 percent 
     for year 1 of the Agreement through year 4 of the Agreement; 
     and
       (B) such goods shall be free of duty for each year 
     thereafter.
       (2) Electric motor vehicles.--In the case of originating 
     goods of Korea classifiable under subheading 8703.90.00 of 
     the HTS that are entered, or withdrawn from warehouse for 
     consumption--
       (A) the rate of duty for such goods shall be--
       (i) 2.0 percent for year 1 of the Agreement;
       (ii) 1.5 percent for year 2 of the Agreement;
       (iii) 1.0 percent for year 3 of the Agreement; and
       (iv) 0.5 percent for year 4 of the Agreement; and
       (B) such goods shall be free of duty for each year 
     thereafter.

[[Page 15197]]

       (3) Certain trucks.--In the case of originating goods of 
     Korea classifiable under subheading 8704.21.00, 8704.22.50, 
     8704.23.00, 8704.31.00, 8704.32.00, or 8704.90.00 of the HTS 
     that are entered, or withdrawn from warehouse for 
     consumption--
       (A) the rate of duty for such goods shall be--
       (i) 25 percent for year 1 of the Agreement through year 7 
     of the Agreement;
       (ii) 16.6 percent for year 8 of the Agreement; and
       (iii) 8.3 percent for year 9 of the Agreement; and
       (B) such goods shall be free of duty for each year 
     thereafter.
       (4) Definitions.--In this subsection--
       (A) the term ``year 1 of the Agreement'' means the period 
     beginning on the date, in a calendar year, on which the 
     Agreement enters into force and ending on December 31 of that 
     calendar year; and
       (B) the terms ``year 2 of the Agreement'', ``year 3 of the 
     Agreement'', ``year 4 of the Agreement'', ``year 5 of the 
     Agreement'', ``year 6 of the Agreement'', ``year 7 of the 
     Agreement'', ``year 8 of the Agreement'', and ``year 9 of the 
     Agreement'' mean the second, third, fourth, fifth, sixth, 
     seventh, eighth, and ninth calendar years, respectively, in 
     which the Agreement is in force.

     SEC. 202. 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 chapter, heading, or subheading, such 
     reference shall be a reference to a chapter, heading, or 
     subheading of the HTS.
       (3) Cost or value.--Any cost or value referred to in this 
     section shall be recorded and maintained in accordance with 
     the generally accepted accounting principles applicable in 
     the territory of the country in which the good is produced 
     (whether Korea or the United States).
       (b) Originating Goods.--For purposes of this Act and for 
     purposes of implementing the preferential tariff treatment 
     provided for under the Agreement, except as otherwise 
     provided in this section, a good is an originating good if--
       (1) the good is a good wholly obtained or produced entirely 
     in the territory of Korea, the United States, or both;
       (2) the good--
       (A) is produced entirely in the territory of Korea, the 
     United States, or both, and--
       (i) each of the nonoriginating materials used in the 
     production of the good undergoes an applicable change in 
     tariff classification specified in Annex 4-A or Annex 6-A of 
     the Agreement; or
       (ii) the good otherwise satisfies any applicable regional 
     value-content or other requirements specified in Annex 4-A or 
     Annex 6-A of the Agreement; and
       (B) satisfies all other applicable requirements of this 
     section; or
       (3) the good is produced entirely in the territory of 
     Korea, the United States, or both, exclusively from materials 
     described in paragraph (1) or (2).
       (c) Regional Value-content.--
       (1) In general.--For purposes of subsection (b)(2), the 
     regional value-content of a good referred to in Annex 6-A of 
     the Agreement, except for goods to which paragraph (4) 
     applies, shall be calculated by the importer, exporter, or 
     producer of the good, on the basis of the build-down method 
     described in paragraph (2) or the build-up method described 
     in paragraph (3).
       (2) Build-down method.--
       (A) In general.--The regional value-content of a good may 
     be calculated on the basis of the following build-down 
     method:


                                            AV-VNM
                                                RVC = --------------  100
                                                AV
 

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


                                               VOM
                                                RVC = -------------- 100
                                                AV
 

       (B) Definitions.--In subparagraph (A):
       (i) RVC.--The term ``RVC'' means the regional value-content 
     of the good, expressed as a percentage.
       (ii) AV.--The term ``AV'' means the adjusted value of the 
     good.
       (iii) VOM.--The term ``VOM'' means the value of originating 
     materials, other than indirect materials, that are acquired 
     or self-produced, and used by the producer in the production 
     of the good.
       (4) Special rule for certain automotive goods.--
       (A) In general.--For purposes of subsection (b)(2), the 
     regional value-content of an automotive good referred to in 
     Annex 6-A of the Agreement may be calculated by the importer, 
     exporter, or producer of the good on the basis of the build-
     down method described in paragraph (2), the build-up method 
     described in paragraph (3), or the following net cost method:


                                                 NC-VNM
                                                RVC = -------------- 100
                                                 NC
 

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

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

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

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

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

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

     if the goods were produced during the fiscal year, quarter, 
     or month that is the basis for the calculation;
       (ii) determine the average referred to in clause (i) 
     separately for such goods sold to 1 or more motor vehicle 
     producers; or
       (iii) make a separate determination under clause (i) or 
     (ii) for such goods that are exported to the territory of 
     Korea or the United States.
       (E) Calculating net cost.--The importer, exporter, or 
     producer of an automotive good shall, consistent with the 
     provisions regarding allocation of costs provided for in 
     generally accepted accounting principles, determine the net 
     cost of the automotive good under subparagraph (B) by--
       (i) calculating the total cost incurred with respect to all 
     goods produced by the producer of the automotive good, 
     subtracting any sales promotion, marketing, and after-sales 
     service costs, royalties, shipping and packing costs, and 
     nonallowable interest costs that are included in the total 
     cost of all such goods, and then reasonably allocating the 
     resulting net cost of those goods to the automotive good;
       (ii) calculating the total cost incurred with respect to 
     all goods produced by that producer, reasonably allocating 
     the total cost to the automotive good, and then subtracting 
     any sales promotion, marketing, and after-sales service 
     costs, royalties, shipping and packing costs, and 
     nonallowable interest costs that are included in the portion 
     of the total cost allocated to the automotive good; or
       (iii) reasonably allocating each cost that forms part of 
     the total cost incurred with respect to the automotive good 
     so that the aggregate of these costs does not include any 
     sales promotion, marketing, and after-sales service costs, 
     royalties, shipping and packing costs, or nonallowable 
     interest costs.
       (d) Value of Materials.--

[[Page 15198]]

       (1) In general.--For the purpose of calculating the 
     regional value-content of a good under subsection (c), and 
     for purposes of applying the de minimis rules under 
     subsection (f), the value of a material is--
       (A) in the case of a material that is imported by the 
     producer of the good, the adjusted value of the material;
       (B) in the case of a material acquired in the territory in 
     which the good is produced, the value, determined in 
     accordance with Articles 1 through 8, Article 15, and the 
     corresponding interpretive notes, of the Agreement on 
     Implementation of Article VII of the General Agreement on 
     Tariffs and Trade 1994 referred to in section 101(d)(8) of 
     the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(8)), as 
     set forth in regulations promulgated by the Secretary of the 
     Treasury providing for the application of such Articles in 
     the absence of an importation by the producer; or
       (C) in the case of a material that is self-produced, the 
     sum of--
       (i) all expenses incurred in the production of the 
     material, including general expenses; and
       (ii) an amount for profit equivalent to the profit added in 
     the normal course of trade.
       (2) Further adjustments to the value of materials.--
       (A) Originating material.--The following expenses, if not 
     included in the value of an originating material calculated 
     under paragraph (1), may be added to the value of the 
     originating material:
       (i) The costs of freight, insurance, packing, and all other 
     costs incurred in transporting the material within or between 
     the territory of Korea, the United States, or both, to the 
     location of the producer.
       (ii) Duties, taxes, and customs brokerage fees on the 
     material paid in the territory of Korea, the United States, 
     or both, other than duties or taxes that are waived, 
     refunded, refundable, or otherwise recoverable, including 
     credit against duty or tax paid or payable.
       (iii) The cost of waste and spoilage resulting from the use 
     of the material in the production of the good, less the value 
     of renewable scrap or byproducts.
       (B) Nonoriginating material.--The following expenses, if 
     included in the value of a nonoriginating material calculated 
     under paragraph (1), may be deducted from the value of the 
     nonoriginating material:
       (i) The costs of freight, insurance, packing, and all other 
     costs incurred in transporting the material within or between 
     the territory of Korea, the United States, or both, to the 
     location of the producer.
       (ii) Duties, taxes, and customs brokerage fees on the 
     material paid in the territory of Korea, the United States, 
     or both, other than duties or taxes that are waived, 
     refunded, refundable, or otherwise recoverable, including 
     credit against duty or tax paid or payable.
       (iii) The cost of waste and spoilage resulting from the use 
     of the material in the production of the good, less the value 
     of renewable scrap or byproducts.
       (iv) The cost of originating materials used in the 
     production of the nonoriginating material in the territory of 
     Korea, the United States, or both.
       (e) Accumulation.--
       (1) Originating materials used in production of goods of 
     the other country.--Originating materials from the territory 
     of Korea or the United States that are used in the production 
     of a good in the territory of the other country shall be 
     considered to originate in the territory of such other 
     country.
       (2) Multiple producers.--A good that is produced in the 
     territory of Korea, 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.
       (f) De Minimis Amounts of Nonoriginating Materials.--
       (1) In general.--Except as provided in paragraphs (2) and 
     (3), a good that does not undergo a change in tariff 
     classification pursuant to Annex 6-A of the Agreement is an 
     originating good if--
       (A) the value of all nonoriginating materials used in the 
     production of the good that do not undergo the applicable 
     change in tariff classification (set forth in Annex 6-A of 
     the Agreement) does not exceed 10 percent of the adjusted 
     value of the good;
       (B) the good meets all other applicable requirements of 
     this section; and
       (C) the value of such nonoriginating materials is included 
     in the value of nonoriginating materials for any applicable 
     regional value-content requirement for the good.
       (2) Exceptions.--Paragraph (1) does not apply to the 
     following:
       (A) A nonoriginating material provided for in chapter 3 
     that is used in the production of a good provided for in 
     chapter 3.
       (B) A nonoriginating material provided for in chapter 4, or 
     a nonoriginating dairy preparation containing over 10 percent 
     by weight of milk solids provided for in subheading 1901.90 
     or 2106.90, that is used in the production of a good provided 
     for in chapter 4.
       (C) A nonoriginating material provided for in chapter 4, or 
     a nonoriginating dairy preparation containing over 10 percent 
     by weight of milk solids provided for in subheading 1901.90, 
     that is used in the production of any of the following goods:
       (i) Infant preparations containing over 10 percent by 
     weight of milk solids provided for in subheading 1901.10.
       (ii) Mixes and doughs, containing over 25 percent by weight 
     of butterfat, not put up for retail sale, provided for in 
     subheading 1901.20.
       (iii) Dairy preparations containing over 10 percent by 
     weight of milk solids provided for in subheading 1901.90 or 
     2106.90.
       (iv) Goods provided for in heading 2105.
       (v) Beverages containing milk provided for in subheading 
     2202.90.
       (vi) Animal feeds containing over 10 percent by weight of 
     milk solids provided for in subheading 2309.90.
       (D) A nonoriginating material provided for in chapter 7 
     that is used in the production of a good provided for in 
     subheading 0703.10, 0703.20, 0709.59, 0709.60, 0711.90, 
     0712.20, 0714.20, or any of subheadings 0710.21 through 
     0710.80 or 0712.39 through 0713.10.
       (E) A nonoriginating material provided for in heading 1006, 
     or a nonoriginating rice product provided for in chapter 11 
     that is used in the production of a good provided for in 
     heading 1006, 1102, 1103, 1104, or subheading 1901.20 or 
     1901.90.
       (F) A nonoriginating material provided for in heading 0805, 
     or any of subheadings 2009.11 through 2009.39, that is used 
     in the production of a good provided for in any of 
     subheadings 2009.11 through 2009.39, or in fruit or vegetable 
     juice of any single fruit or vegetable, fortified with 
     minerals or vitamins, concentrated or unconcentrated, 
     provided for in subheading 2106.90 or 2202.90.
       (G) Nonoriginating peaches, pears, or apricots provided for 
     in chapter 8 or 20 that are used in the production of a good 
     provided for in heading 2008.
       (H) A nonoriginating material provided for in chapter 15 
     that is used in the production of a good provided for in any 
     of headings 1501 through 1508, or heading 1512, 1514, or 
     1515.
       (I) A nonoriginating material provided for in heading 1701 
     that is used in the production of a good provided for in any 
     of headings 1701 through 1703.
       (J) A nonoriginating material provided for in chapter 17 
     that is used in the production of a good provided for in 
     subheading 1806.10.
       (K) Except as provided in subparagraphs (A) through (J) and 
     Annex 6-A of the Agreement, a nonoriginating material used in 
     the production of a good provided for in any of chapters 1 
     through 24, unless the nonoriginating material is provided 
     for in a different subheading than the good for which origin 
     is being determined under this section.
       (3) Textile or apparel goods.--
       (A) In general.--Except as provided in subparagraph (B), a 
     textile or apparel good that is not an originating good 
     because certain fibers or yarns used in the production of the 
     component of the good that determines the tariff 
     classification of the good do not undergo an applicable 
     change in tariff classification, set forth 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 and finished in the territory of 
     Korea, the United States, or both.
       (C) Yarn, fabric, or fiber.--For purposes of this 
     paragraph, in the case of a good that is a yarn, fabric, or 
     fiber, the term ``component of the good that determines the 
     tariff classification of the good'' means all of the fibers 
     in the good.
       (g) Fungible Goods and Materials.--
       (1) In general.--
       (A) Claim for preferential tariff treatment.--A person 
     claiming that a fungible good or fungible material is an 
     originating good may base the claim either on the physical 
     segregation of the fungible good or fungible material or by 
     using an inventory management method with respect to the 
     fungible good or fungible material.
       (B) Inventory management method.--In this subsection, the 
     term ``inventory management method'' means--
       (i) averaging;
       (ii) ``last-in, first-out'';
       (iii) ``first-in, first-out''; or
       (iv) any other method--

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

       (2) Election of inventory method.--A person selecting an 
     inventory management method under paragraph (1) for a 
     particular fungible good or fungible material shall continue 
     to use that method for that fungible good or fungible 
     material throughout the fiscal year of such person.
       (h) Accessories, Spare Parts, or Tools.--
       (1) In general.--Subject to paragraphs (2) and (3), 
     accessories, spare parts, or tools delivered with a good that 
     form part of the good's standard accessories, spare parts, or 
     tools shall--
       (A) be treated as originating goods if the good is an 
     originating good; and
       (B) be disregarded in determining whether all the 
     nonoriginating materials used in the

[[Page 15199]]

     production of the good undergo the applicable change in 
     tariff classification set forth in Annex 6-A of the 
     Agreement.
       (2) Conditions.--Paragraph (1) shall apply only if--
       (A) the accessories, spare parts, or tools are classified 
     with and not invoiced separately from the good; and
       (B) the quantities and value of the accessories, spare 
     parts, or tools are customary for the good.
       (3) Regional value content.--If the good is subject to a 
     regional value-content requirement, the value of the 
     accessories, spare parts, or tools shall be taken into 
     account as originating or nonoriginating materials, as the 
     case may be, in calculating the regional value-content of the 
     good.
       (i) Packaging Materials and Containers for Retail Sale.--
     Packaging materials and containers in which a good is 
     packaged for retail sale, if classified with the good, shall 
     be disregarded in determining whether all the nonoriginating 
     materials used in the production of the good undergo the 
     applicable change in tariff classification set forth in Annex 
     4-A or Annex 6-A of the Agreement, and, if the good is 
     subject to a regional value-content requirement, the value of 
     such packaging materials and containers shall be taken into 
     account as originating or nonoriginating materials, as the 
     case may be, in calculating the regional value-content of the 
     good.
       (j) Packing Materials and Containers for Shipment.--Packing 
     materials and containers for shipment shall be disregarded in 
     determining whether a good is an originating good.
       (k) Indirect Materials.--An indirect material shall be 
     disregarded in determining whether a good is an originating 
     good.
       (l) Transit and Transhipment.--A good that has undergone 
     production necessary to qualify as an originating good under 
     subsection (b) shall not be considered to be an originating 
     good if, subsequent to that production, the good--
       (1) undergoes further production or any other operation 
     outside the territory of Korea 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 Korea or the United States; or
       (2) does not remain under the control of customs 
     authorities in the territory of a country other than Korea or 
     the United States.
       (m) Goods Classifiable as Goods Put up in Sets.--
     Notwithstanding the rules set forth in Annex 4-A and Annex 6-
     A of the Agreement, 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--
       (1) each of the goods in the set is an originating good; or
       (2) the total value of the nonoriginating goods in the set 
     does not exceed--
       (A) in the case of textile or apparel goods, 10 percent of 
     the adjusted value of the set; or
       (B) in the case of goods, other than textile or apparel 
     goods, 15 percent of the adjusted value of the set.
       (n) Definitions.--In this section:
       (1) Adjusted value.--The term ``adjusted value'' means the 
     value determined in accordance with Articles 1 through 8, 
     Article 15, and the corresponding interpretive notes, of the 
     Agreement on Implementation of Article VII of the General 
     Agreement on Tariffs and Trade 1994 referred to in section 
     101(d)(8) of the Uruguay Round Agreements Act (19 U.S.C. 
     3511(d)(8)), adjusted, if necessary, to exclude any costs, 
     charges, or expenses incurred for transportation, insurance, 
     and related services incident to the international shipment 
     of the merchandise from the country of exportation to the 
     place of importation.
       (2) Class of motor vehicles.--The term ``class of motor 
     vehicles'' means any one of the following categories of motor 
     vehicles:
       (A) Motor vehicles provided for in subheading 8701.20, 
     8704.10, 8704.22, 8704.23, 8704.32, or 8704.90, or heading 
     8705 or 8706, or motor vehicles for the transport of 16 or 
     more persons provided for in subheading 8702.10 or 8702.90.
       (B) Motor vehicles provided for in subheading 8701.10 or 
     any of subheadings 8701.30 through 8701.90.
       (C) Motor vehicles for the transport of 15 or fewer persons 
     provided for in subheading 8702.10 or 8702.90, or motor 
     vehicles provided for in subheading 8704.21 or 8704.31.
       (D) Motor vehicles provided for in any of subheadings 
     8703.21 through 8703.90.
       (3) Fungible good or fungible material.--The term 
     ``fungible good'' or ``fungible material'' means a good or 
     material, as the case may be, that is interchangeable with 
     another good or material for commercial purposes and the 
     properties of which are essentially identical to such other 
     good or material.
       (4) Generally accepted accounting principles.--The term 
     ``generally accepted accounting principles''--
       (A) means the recognized consensus or substantial 
     authoritative support given in the territory of Korea or the 
     United States, as the case may be, with respect to the 
     recording of revenues, expenses, costs, assets, and 
     liabilities, the disclosure of information, and the 
     preparation of financial statements; and
       (B) may encompass broad guidelines for general application 
     as well as detailed standards, practices, and procedures.
       (5) Good wholly obtained or produced entirely in the 
     territory of korea, the united states, or both.--The term 
     ``good wholly obtained or produced entirely in the territory 
     of Korea, the United States, or both'' means any of the 
     following:
       (A) Plants and plant products grown, and harvested or 
     gathered, in the territory of Korea, the United States, or 
     both.
       (B) Live animals born and raised in the territory of Korea, 
     the United States, or both.
       (C) Goods obtained in the territory of Korea, the United 
     States, or both from live animals.
       (D) Goods obtained from hunting, trapping, fishing, or 
     aquaculture conducted in the territory of Korea, the United 
     States, or both.
       (E) Minerals and other natural resources not included in 
     subparagraphs (A) through (D) that are extracted or taken 
     from the territory of Korea, the United States, or both.
       (F) Fish, shellfish, and other marine life taken from the 
     sea, seabed, or subsoil outside the territory of Korea or the 
     United States by--
       (i) a vessel that is registered or recorded with Korea and 
     flying the flag of Korea; or
       (ii) a vessel that is documented under the laws of the 
     United States.
       (G) Goods produced on board a factory ship from goods 
     referred to in subparagraph (F), if such factory ship--
       (i) is registered or recorded with Korea and flies the flag 
     of Korea; or
       (ii) is a vessel that is documented under the laws of the 
     United States.
       (H)(i) Goods taken by Korea or a person of Korea from the 
     seabed or subsoil outside the territory of Korea, the United 
     States, or both, if Korea has rights to exploit such seabed 
     or subsoil; or
       (ii) Goods taken by the United States or a person of the 
     United States from the seabed or subsoil outside the 
     territory of the United States, Korea, or both, if the United 
     States has rights to exploit such seabed or subsoil.
       (I) Goods taken from outer space, if the goods are obtained 
     by Korea or the United States or a person of Korea or the 
     United States and not processed in the territory of a country 
     other than Korea or the United States.
       (J) Waste and scrap derived from--
       (i) manufacturing or processing operations in the territory 
     of Korea, the United States, or both; or
       (ii) used goods collected in the territory of Korea, the 
     United States, or both, if such goods are fit only for the 
     recovery of raw materials.
       (K) Recovered goods derived in the territory of Korea, the 
     United States, or both, from used goods, and used in the 
     territory of Korea, the United States, or both, in the 
     production of remanufactured goods.
       (L) Goods, at any stage of production, produced in the 
     territory of Korea, the United States, or both, exclusively 
     from--
       (i) goods referred to in any of subparagraphs (A) through 
     (J); or
       (ii) the derivatives of goods referred to in clause (i).
       (6) Identical goods.--The term ``identical goods'' means 
     goods that are the same in all respects relevant to the rule 
     of origin that qualifies the goods as originating goods.
       (7) Indirect material.--The term ``indirect material'' 
     means a good used in the production, testing, or inspection 
     of another good but not physically incorporated into that 
     other good, or a good used in the maintenance of buildings or 
     the operation of equipment associated with the production of 
     another good, including--
       (A) fuel and energy;
       (B) tools, dies, and molds;
       (C) spare parts and materials used in the maintenance of 
     equipment or buildings;
       (D) lubricants, greases, compounding materials, and other 
     materials used in production or used to operate equipment or 
     buildings;
       (E) gloves, glasses, footwear, clothing, safety equipment, 
     and supplies;
       (F) equipment, devices, and supplies used for testing or 
     inspecting the good;
       (G) catalysts and solvents; and
       (H) any other good that is not incorporated into the other 
     good but the use of which in the production of the other good 
     can reasonably be demonstrated to be a part of that 
     production.
       (8) Material.--The term ``material'' means a good that is 
     used in the production of another good, including a part or 
     an ingredient.
       (9) Material that is self-produced.--The term ``material 
     that is self-produced'' means an originating material that is 
     produced by a producer of a good and used in the production 
     of that good.
       (10) Model line of motor vehicles.--The term ``model line 
     of motor vehicles'' means a group of motor vehicles having 
     the same platform or model name.
       (11) Net cost.--The term ``net cost'' means total cost 
     minus sales promotion, marketing, and after-sales service 
     costs, royalties, shipping and packing costs, and non-
     allowable interest costs that are included in the total cost.
       (12) Nonallowable interest costs.--The term ``nonallowable 
     interest costs'' means

[[Page 15200]]

     interest costs incurred by a producer that exceed 700 basis 
     points above the applicable official interest rate for 
     comparable maturities of the country in which the producer is 
     located.
       (13) Nonoriginating good or nonoriginating material.--The 
     term ``nonoriginating good'' or ``nonoriginating material'' 
     means a good or material, as the case may be, that does not 
     qualify as originating under this section.
       (14) Packing materials and containers for shipment.--The 
     term ``packing materials and containers for shipment'' means 
     goods used to protect another good during its transportation 
     and does not include the packaging materials and containers 
     in which the other good is packaged for retail sale.
       (15) Preferential tariff treatment.--The term 
     ``preferential tariff treatment'' means the customs duty 
     rate, and the treatment under article 2.10.4 of the 
     Agreement, that are applicable to an originating good 
     pursuant to the Agreement.
       (16) Producer.--The term ``producer'' means a person who 
     engages in the production of a good in the territory of Korea 
     or the United States.
       (17) Production.--The term ``production'' means growing, 
     mining, harvesting, fishing, breeding, raising, trapping, 
     hunting, manufacturing, processing, assembling, or 
     disassembling a good.
       (18) Reasonably allocate.--The term ``reasonably allocate'' 
     means to apportion in a manner that would be appropriate 
     under generally accepted accounting principles.
       (19) Recovered goods.--The term ``recovered goods'' means 
     materials in the form of individual parts that are the result 
     of--
       (A) the disassembly of used goods into individual parts; 
     and
       (B) the cleaning, inspecting, testing, or other processing 
     that is necessary for improvement to sound working condition 
     of such individual parts.
       (20) Remanufactured good.--The term ``remanufactured good'' 
     means a good that is classified under chapter 84, 85, 87, or 
     90 or heading 9402, and that--
       (A) is entirely or partially comprised of recovered goods; 
     and
       (B) has a similar life expectancy and enjoys a factory 
     warranty similar to such a good that is new.
       (21) Total cost.--
       (A) In general.--The term ``total cost''--
       (i) means all product costs, period costs, and other costs 
     for a good incurred in the territory of Korea, the United 
     States, or both; and
       (ii) does not include profits that are earned by the 
     producer, regardless of whether they are retained by the 
     producer or paid out to other persons as dividends, or taxes 
     paid on those profits, including capital gains taxes.
       (B) Other definitions.--In this paragraph:
       (i) Product costs.--The term ``product costs'' means costs 
     that are associated with the production of a good and include 
     the value of materials, direct labor costs, and direct 
     overhead.
       (ii) Period costs.--The term ``period costs'' means costs, 
     other than product costs, that are expensed in the period in 
     which they are incurred, such as selling expenses and general 
     and administrative expenses.
       (iii) Other costs.--The term ``other costs'' means all 
     costs recorded on the books of the producer that are not 
     product costs or period costs, such as interest.
       (22) Used.--The term ``used'' means utilized or consumed in 
     the production of goods.
       (o) Presidential Proclamation Authority.--
       (1) In general.--The President is authorized to proclaim, 
     as part of the HTS--
       (A) the provisions set forth in Annex 4-A and Annex 6-A of 
     the Agreement; and
       (B) any additional subordinate category that is 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 (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) such modifications to the provisions proclaimed under 
     the authority of paragraph (1)(A) as are necessary to 
     implement an agreement with Korea pursuant to article 4.2.5 
     of the Agreement; and
       (ii) before the end of the 1-year period beginning on the 
     date on which the Agreement enters into force, modifications 
     to correct any typographical, clerical, or other 
     nonsubstantive technical error regarding the provisions of 
     chapters 50 through 63 (as included in Annex 4-A of the 
     Agreement).
       (3) Fibers, yarns, or fabrics not available in commercial 
     quantities in the united states.--
       (A) In general.--Notwithstanding paragraph (2)(A), the list 
     of fibers, yarns, and fabrics set forth in the list of the 
     United States in Appendix 4-B-1 of the Agreement may be 
     modified as provided for in this paragraph.
       (B) Definitions.--In this paragraph:
       (i) Interested entity.--The term ``interested entity'' 
     means the Government of Korea, a potential or actual 
     purchaser of a textile or apparel good, or a potential or 
     actual supplier of a textile or apparel good.
       (ii) Day; days.--All references to ``day'' and ``days'' 
     exclude Saturdays, Sundays, and legal holidays observed by 
     the Government of the United States.
       (C) Requests to add fibers, yarns, or fabrics.--
       (i) In general.--An interested entity may request the 
     President to determine that a fiber, yarn, or fabric is not 
     available in commercial quantities in a timely manner in the 
     United States and to add that fiber, yarn, or fabric to the 
     list of the United States in Appendix 4-B-1 of the Agreement.
       (ii) Determination.--After receiving a request under clause 
     (i), the President may determine whether--

       (I) the fiber, yarn, or fabric is available in commercial 
     quantities in a timely manner in the United States; or
       (II) any interested entity objects to the request.

       (iii) Proclamation authority.--The President may, within 
     the time periods specified in clause (iv), proclaim that the 
     fiber, yarn, or fabric that is the subject of the request is 
     added to the list of the United States in Appendix 4-B-1 of 
     the Agreement, if the President has determined under clause 
     (ii) that--

       (I) the fiber, yarn, or fabric is not available in 
     commercial quantities in a timely manner in the United 
     States; or
       (II) no interested entity has objected to the request.

       (iv) Time periods.--The time periods within which the 
     President may issue a proclamation under clause (iii) are--

       (I) not later than 30 days after the date on which a 
     request is submitted under clause (i); or
       (II) not later than 60 days after the request is submitted, 
     if the President determines, within 30 days after the date on 
     which the request is submitted, that the President does not 
     have sufficient information to make a determination under 
     clause (ii).

       (v) Effective date.--Notwithstanding section 103(a)(2), a 
     proclamation made under clause (iii) shall take effect on the 
     date on which the text of the proclamation is published in 
     the Federal Register.
       (D) Deemed denial of request.--If, after an interested 
     entity submits a request under subparagraph (C)(i), the 
     President does not, within 30 days of the expiration of the 
     applicable time period specified in subparagraph (C)(iv), 
     make a determination under subparagraph (C)(ii) regarding the 
     request, the request shall be considered to be denied.
       (E) Requests to remove fibers, yarns, or fabrics.--
       (i) In general.--An interested entity may request the 
     President to remove from the list of the United States in 
     Appendix 4-B-1 of the Agreement, any fiber, yarn, or fabric 
     that has been added to that list pursuant to subparagraph 
     (C)(iii).
       (ii) Proclamation authority.--Not later than 30 days after 
     the date on which a request under clause (i) is submitted, 
     the President may proclaim that the fiber, yarn, or fabric 
     that is the subject of the request is removed from the list 
     of the United States in Appendix 4-B-1 of the Agreement if 
     the President determines that the fiber, yarn, or fabric is 
     available in commercial quantities in a timely manner in the 
     United States.
       (iii) Effective date.--A proclamation issued under clause 
     (ii) may not take effect earlier than the date that is 6 
     months after the date on which the text of the proclamation 
     is published in the Federal Register.
       (F) Procedures.--The President shall establish procedures--
       (i) governing the submission of a request under 
     subparagraphs (C) and (E); and
       (ii) providing an opportunity for interested entities to 
     submit comments and supporting evidence before the President 
     makes a determination under subparagraph (C)(ii) or (E)(ii).

     SEC. 203. CUSTOMS USER FEES.

       Section 13031(b) of the Consolidated Omnibus Budget 
     Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by 
     adding after paragraph (18) the following:
       ``(19) No fee may be charged under subsection (a) (9) or 
     (10) with respect to goods that qualify as originating goods 
     under section 202 of the United States-Korea Free Trade 
     Agreement Implementation Act. Any service for which an 
     exemption from such fee is provided by reason of this 
     paragraph may not be funded with money contained in the 
     Customs User Fee Account.''.

     SEC. 204. DISCLOSURE OF INCORRECT INFORMATION; FALSE 
                   CERTIFICATIONS OF ORIGIN; DENIAL OF 
                   PREFERENTIAL TARIFF TREATMENT.

       (a) Disclosure of Incorrect Information.--Section 592 of 
     the Tariff Act of 1930 (19 U.S.C. 1592) is amended--
       (1) in subsection (c)--
       (A) by redesignating paragraph (11) as paragraph (12); and
       (B) by inserting after paragraph (10) the following new 
     paragraph:
       ``(11) Prior disclosure regarding claims under the united 
     states-korea free trade agreement.--An importer shall not be 
     subject to penalties under subsection (a) for

[[Page 15201]]

     making an incorrect claim that a good qualifies as an 
     originating good under section 202 of the United States-Korea 
     Free Trade Agreement Implementation Act if the importer, in 
     accordance with regulations issued by the Secretary of the 
     Treasury, promptly and voluntarily makes a corrected 
     declaration and pays any duties owing with respect to that 
     good.''; and
       (2) by adding at the end the following new subsection:
       ``(j) False Certifications of Origin Under the United 
     States-Korea Free Trade Agreement.--
       ``(1) In general.--Subject to paragraph (2), it is unlawful 
     for any person to certify falsely, by fraud, gross 
     negligence, or negligence, in a KFTA certification of origin 
     (as defined in section 508 of this Act) that a good exported 
     from the United States qualifies as an originating good under 
     the rules of origin provided for in section 202 of the United 
     States-Korea Free Trade Agreement Implementation Act. The 
     procedures and penalties of this section that apply to a 
     violation of subsection (a) also apply to a violation of this 
     subsection.
       ``(2) Prompt and voluntary disclosure of incorrect 
     information.--No penalty shall be imposed under this 
     subsection if, promptly after an exporter or producer that 
     issued a KFTA certification of origin has reason to believe 
     that such certification contains or is based on incorrect 
     information, the exporter or producer voluntarily provides 
     written notice of such incorrect information to every person 
     to whom the certification was issued.
       ``(3) Exception.--A person shall not be considered to have 
     violated paragraph (1) if--
       ``(A) the information was correct at the time it was 
     provided in a KFTA certification of origin but was later 
     rendered incorrect due to a change in circumstances; and
       ``(B) the person promptly and voluntarily provides written 
     notice of the change in circumstances to all persons to whom 
     the person provided the certification.''.
       (b) Denial of Preferential Tariff Treatment.--Section 514 
     of the Tariff Act of 1930 (19 U.S.C. 1514) is amended by 
     adding at the end the following new subsection:
       ``(j) Denial of Preferential Tariff Treatment Under the 
     United States-Korea Free Trade Agreement.--If U.S. Customs 
     and Border Protection or U.S. Immigration and Customs 
     Enforcement of the Department of Homeland Security finds 
     indications of a pattern of conduct by an importer, exporter, 
     or producer of false or unsupported representations that 
     goods qualify under the rules of origin provided for in 
     section 202 of the United States-Korea Free Trade Agreement 
     Implementation Act, U.S. Customs and Border Protection, in 
     accordance with regulations issued by the Secretary of the 
     Treasury, may suspend preferential tariff treatment under the 
     United States-Korea Free Trade Agreement Implementation Act 
     to entries of identical goods covered by subsequent 
     representations by that importer, exporter, or producer until 
     U.S. Customs and Border Protection determines that 
     representations of that person are in conformity with such 
     section 202.''.

     SEC. 205. RELIQUIDATION OF ENTRIES.

       Section 520(d) of the Tariff Act of 1930 (19 U.S.C. 
     1520(d)) is amended in the matter preceding paragraph (1)--
       (1) by striking ``or''; and
       (2) by striking ``for which'' and inserting ``, or section 
     202 of the United States-Korea Free Trade Agreement 
     Implementation Act for which''.

     SEC. 206. RECORDKEEPING REQUIREMENTS.

       Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is 
     amended--
       (1) by redesignating subsection (i) as subsection (j);
       (2) by inserting after subsection (h) the following new 
     subsection:
       ``(i) Certifications of Origin for Goods Exported Under the 
     United States-Korea Free Trade Agreement.--
       ``(1) Definitions.--In this subsection:
       ``(A) Records and supporting documents.--The term `records 
     and supporting documents' means, with respect to an exported 
     good under paragraph (2), records and documents related to 
     the origin of the good, including--
       ``(i) the purchase, cost, and value of, and payment for, 
     the good;
       ``(ii) the purchase, cost, and value of, and payment for, 
     all materials, including indirect materials, used in the 
     production of the good; and
       ``(iii) the production of the good in the form in which it 
     was exported.
       ``(B) KFTA certification of origin.--The term `KFTA 
     certification of origin' means the certification established 
     under article 6.15 of the United States-Korea Free Trade 
     Agreement that a good qualifies as an originating good under 
     such Agreement.
       ``(2) Exports to korea.--Any person who completes and 
     issues a KFTA certification of origin for a good exported 
     from the United States shall make, keep, and, pursuant to 
     rules and regulations promulgated by the Secretary of the 
     Treasury, render for examination and inspection all records 
     and supporting documents related to the origin of the good 
     (including the certification or copies thereof).
       ``(3) Retention period.--The person who issues a KFTA 
     certification of origin shall keep the records and supporting 
     documents relating to that certification of origin for a 
     period of at least 5 years after the date on which the 
     certification is issued.''; and
       (3) in subsection (j), as so redesignated, by striking 
     ``(g), or (h)'' and inserting ``(g), (h), or (i)''.

     SEC. 207. ENFORCEMENT RELATING TO TRADE IN TEXTILE OR APPAREL 
                   GOODS.

       (a) Action During Verification.--
       (1) In general.--If the Secretary of the Treasury requests 
     the Government of Korea to conduct a verification pursuant to 
     article 4.3 of the Agreement for purposes of making a 
     determination under paragraph (2), the President may direct 
     the Secretary to take appropriate action described in 
     subsection (b) while the verification is being conducted.
       (2) Determination.--A determination under this paragraph is 
     a determination of the Secretary that--
       (A) an exporter or producer in Korea is complying with 
     applicable customs laws, regulations, procedures, 
     requirements, and practices affecting trade in textile or 
     apparel goods; or
       (B) a claim that a textile or apparel good exported or 
     produced by such exporter or producer--
       (i) qualifies as an originating good under section 202, or
       (ii) is a good of Korea,

     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 under subsection (a)(1) 
     regarding compliance described in subsection (a)(2)(A), in a 
     case in which the request for verification was based on a 
     reasonable suspicion of unlawful activity related to such 
     goods; and
       (2) suspension of liquidation of the entry of a textile or 
     apparel good for which a claim has been made that is the 
     subject of a verification under subsection (a)(1) regarding a 
     claim described in subsection (a)(2)(B).
       (c) Action When Information Is Insufficient.--If the 
     Secretary of the Treasury determines that the information 
     obtained within 12 months after making a request for a 
     verification under subsection (a)(1) is insufficient to make 
     a determination under subsection (a)(2), the President may 
     direct the Secretary to take appropriate action described in 
     subsection (d) until such time as the Secretary receives 
     information sufficient to make the determination under 
     subsection (a)(2) or until such earlier date as the President 
     may direct.
       (d) Appropriate Action Described.--Appropriate action under 
     subsection (c) includes--
       (1) denial of preferential tariff treatment under the 
     Agreement with respect to--
       (A) any textile or apparel good exported or produced by the 
     person that is the subject of a verification under subsection 
     (a)(1) regarding compliance described in subsection 
     (a)(2)(A); or
       (B) the textile or apparel good for which a claim has been 
     made that is the subject of a verification under subsection 
     (a)(1) regarding a claim described in subsection (a)(2)(B); 
     and
       (2) denial of entry into the United States of--
       (A) any textile or apparel good exported or produced by the 
     person that is the subject of a verification under subsection 
     (a)(1) regarding compliance described in subsection 
     (a)(2)(A); or
       (B) a textile or apparel good for which a claim has been 
     made that is the subject of a verification under subsection 
     (a)(1) regarding a claim described in subsection (a)(2)(B).
       (e) Publication of Name of Person.--In accordance with 
     article 4.3.11 of the Agreement, the Secretary of the 
     Treasury may publish the name of any person that the 
     Secretary has determined--
       (1) is engaged in circumvention of applicable laws, 
     regulations, or procedures affecting trade in textile or 
     apparel goods; or
       (2) has failed to demonstrate that it produces, or is 
     capable of producing, textile or apparel goods.
       (f) Certificate of Eligibility.--The Commissioner 
     responsible for U.S. Customs and Border Protection of the 
     Department of Homeland Security may require an importer to 
     submit at the time the importer files a claim for 
     preferential tariff treatment under Annex 4-B of the 
     Agreement a certificate of eligibility, properly completed 
     and signed by an authorized official of the Government of 
     Korea.
       (g) Verifications in the United States.--If the government 
     of a country that is a party to a free trade agreement with 
     the United States makes a request for a verification pursuant 
     to that agreement, the Secretary of the Treasury may request 
     a verification of the production of any textile or apparel 
     good in order to assist that government in determining 
     whether--
       (1) a claim of origin under the agreement for a textile or 
     apparel good is accurate; or
       (2) an exporter, producer, or other enterprise located in 
     the United States involved in the movement of textile or 
     apparel goods from the United States to the territory of the 
     requesting government is complying

[[Page 15202]]

     with applicable customs laws, regulations, and procedures 
     regarding trade in textile or apparel goods.

     SEC. 208. REGULATIONS.

       The Secretary of the Treasury shall prescribe such 
     regulations as may be necessary to carry out--
       (1) subsections (a) through (n) of section 202;
       (2) the amendment made by section 203; and
       (3) any proclamation issued under section 202(o).

                     TITLE III--RELIEF FROM IMPORTS

     SEC. 301. DEFINITIONS.

       In this title:
       (1) Korean article.--The term ``Korean article'' means an 
     article that qualifies as an originating good under section 
     202(b).
       (2) Korean motor vehicle article.--The term ``Korean motor 
     vehicle article'' means a good provided for in heading 8703 
     or 8704 of the HTS that qualifies as an originating good 
     under section 202(b).
       (3) Korean textile or apparel article.--The term ``Korean 
     textile or apparel article'' means a textile or apparel good 
     (as defined in section 3(5)) that is a Korean article.

     Subtitle A--Relief From Imports Benefitting 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 Korean 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 Korean 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 
     Korean article if, after the date on which the Agreement 
     enters into force, import relief has been provided with 
     respect to that Korean article under this subtitle.

     SEC. 312. COMMISSION ACTION ON PETITION.

       (a) Determination.--Not later than 120 days (180 days if 
     critical circumstances have been alleged) after the date on 
     which an investigation is initiated under section 311(b) with 
     respect to a petition, the Commission shall make the 
     determination required under that section.
       (b) Applicable Provisions.--For purposes of this subtitle, 
     the provisions of paragraphs (1), (2), and (3) of section 
     330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2), 
     and (3)) shall be applied with respect to determinations and 
     findings made under this section as if such determinations 
     and findings were made under section 202 of the Trade Act of 
     1974 (19 U.S.C. 2252).
       (c) Additional Finding and Recommendation if Determination 
     Affirmative.--
       (1) In general.--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)(1)), 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.
       (2) Limitation on relief.--The import relief recommended by 
     the Commission under this subsection shall be limited to the 
     relief described in section 313(c).
       (3) Voting; separate views.--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 referred to in 
     paragraph (1) and any finding or recommendation referred to 
     in paragraph (2).
       (e) Public Notice.--Upon submitting a report to the 
     President under subsection (d), the Commission shall promptly 
     make public the report (with the exception of information 
     which the Commission determines to be confidential) and shall 
     publish a summary of the report 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 a 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.--Except as provided in paragraph (2), the 
     import relief that the President is authorized to provide 
     under this section with respect to imports of an article is 
     as follows:
       (A) The suspension of any further reduction provided for 
     under Annex 2-B of the Agreement in the duty imposed on the 
     article.
       (B) 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 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.
       (2) Duties applied on a seasonal basis.--In the case of 
     imports of an article to which a duty is applied on a 
     seasonal basis, the import relief that the President is 
     authorized to provide under this section is as follows:
       (A) The suspension of any further reduction provided for 
     under Annex 2-B of the Agreement in the duty imposed on the 
     article.
       (B) 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 corresponding season immediately 
     preceding the date the import relief is provided; or
       (ii) the column 1 general rate of duty imposed under the 
     HTS for the corresponding season immediately preceding the 
     date on which the Agreement enters into force.
       (3) Progressive liberalization.--If the period for which 
     import relief is provided under this section is greater than 
     1 year, the President shall provide for the progressive 
     liberalization (described in article 10.2.7 of the Agreement) 
     of such relief at regular intervals during the period of its 
     application.
       (d) Period of Relief.--
       (1) In general.--Subject to paragraph (2), any import 
     relief that the President provides under this section may not 
     be in effect for more than 2 years.
       (2) Extension.--
       (A) In general.--Subject to subparagraph (C), the 
     President, after receiving a determination from the 
     Commission under subparagraph (B) that is affirmative, or 
     which 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)), may extend the effective period of any 
     import relief provided under this section by up to 1 year, 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

[[Page 15203]]

       (ii) there is evidence that the industry is making a 
     positive adjustment to import competition.
       (B) Action by commission.--
       (i) Investigation.--Upon a petition on behalf of the 
     industry concerned that is filed with the Commission not 
     earlier than the date that is 9 months, and not later than 
     the date that is 6 months, before the date on which any 
     action taken under subsection (a) is to terminate, the 
     Commission shall conduct an investigation to determine 
     whether action under this section continues to be necessary 
     to remedy or prevent serious injury and whether there is 
     evidence that the industry is making a positive adjustment to 
     import competition.
       (ii) Notice and hearing.--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) Report.--The Commission shall submit 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 3 years.
       (e) Rate After Termination of Import Relief.--Beginning on 
     the date on which 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.
       (f) Articles Exempt From Relief.--No import relief may be 
     provided under this section on any article that is subject to 
     import relief under--
       (1) subtitle B or C; or
       (2) chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.).

     SEC. 314. TERMINATION OF RELIEF AUTHORITY.

       (a) General Rule.--Subject to subsection (b), no import 
     relief may be provided under this subtitle after the date 
     that is 10 years after the date on which the Agreement enters 
     into force.
       (b) Exception.--If an article for which relief is provided 
     under this subtitle is an article for which the period for 
     tariff elimination, set forth in the Schedule of the United 
     States to Annex 2-B of the Agreement, is greater than 10 
     years, no relief under this subtitle may be provided for that 
     article after the date on which that period ends.
       (c) Presidential Determination.--Import relief may be 
     provided under this subtitle in the case of a Korean article 
     after the date on which such relief would, but for this 
     subsection, terminate under subsection (a) and (b), if the 
     President determines that Korea 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 (19 U.S.C. 2251 et seq.).

     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-Korea Free Trade Agreement 
     Implementation Act''.

              Subtitle B--Motor Vehicle Safeguard Measures

     SEC. 321. MOTOR VEHICLE SAFEGUARD MEASURES.

       The provisions of subtitle A shall apply with respect to a 
     Korean motor vehicle article to the same extent that such 
     provisions apply to Korean articles, except as follows:
       (1) Section 311(d) and paragraphs (2) and (3) of 313(c) 
     shall not apply.
       (2) Section 313(d)(2)(A) shall be applied and administered 
     by substituting ``2 years'' for ``1 year''.
       (3) Section 313(d)(2)(C) shall be applied and administered 
     by substituting ``4 years'' for ``3 years''.
       (4) Section 313(f)(1) shall be applied and administered by 
     substituting ``subtitle A'' for ``subtitle B or C''.
       (5) Section 314(b) shall be applied and administered as if 
     such section read as follows:
       ``(b) Exception.--Import relief may be provided under this 
     subtitle with respect to a Korean motor vehicle article 
     during any period before the date that is 10 years after the 
     date on which duties on the article are eliminated, as set 
     forth in section 201(d), or, if the article is not referred 
     to in section 201(d), the Schedule of the United States to 
     Annex 2-B of the Agreement.''.

           Subtitle C--Textile and Apparel Safeguard Measures

     SEC. 331. COMMENCEMENT OF ACTION FOR RELIEF.

       (a) In General.--A request for action 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 publish 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. 332. DETERMINATION AND PROVISION OF RELIEF.

       (a) Determination.--
       (1) In general.--If a positive determination is made under 
     section 331(b), the President shall determine whether, as a 
     result of the reduction or elimination of a duty under the 
     Agreement, a Korean textile or apparel article is being 
     imported into the United States in such increased quantities, 
     in absolute terms or relative to the domestic market for that 
     article, and under such conditions as to cause serious 
     damage, or actual threat thereof, to a domestic industry 
     producing an article that is like, or directly competitive 
     with, the imported article.
       (2) Serious damage.--In making a determination under 
     paragraph (1), the President--
       (A) shall examine the effect of increased imports on the 
     domestic industry, as reflected in changes in such relevant 
     economic factors as output, productivity, utilization of 
     capacity, inventories, market share, exports, wages, 
     employment, domestic prices, profits, and investment, no one 
     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 
     provided 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.
       (2) Nature of relief.--The relief that the President is 
     authorized to provide under this subsection with respect to 
     imports of an article is--
       (A) the suspension of any further reduction provided for 
     under Annex 2-B of the Agreement in the duty imposed on the 
     article; or
       (B) 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 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.

     SEC. 333. PERIOD OF RELIEF.

       (a) In General.--Subject to subsection (b), the import 
     relief that the President provides under section 332(b) may 
     not be in effect for more than 2 years.
       (b) Extension.--
       (1) In general.--Subject to paragraph (2), the President 
     may extend the effective period of any import relief provided 
     under this subtitle for a period of not more than 2 years, if 
     the President determines that--
       (A) the import relief continues to be necessary to remedy 
     or prevent serious damage and to facilitate adjustment by the 
     domestic industry to import competition; and
       (B) there is evidence that the industry is making a 
     positive adjustment to import competition.
       (2) Limitation.--Any relief provided under this subtitle, 
     including any extensions thereof, may not, in the aggregate, 
     be in effect for more than 4 years.

     SEC. 334. ARTICLES EXEMPT FROM RELIEF.

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

     SEC. 335. RATE AFTER TERMINATION OF IMPORT RELIEF.

       On the date on which 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.

     SEC. 336. 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

[[Page 15204]]

     which duties on the article are eliminated pursuant to the 
     Agreement.

     SEC. 337. 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 (19 U.S.C. 2251 et seq.).

     SEC. 338. CONFIDENTIAL BUSINESS INFORMATION.

       The President may not release information received in 
     connection with an investigation or determination under this 
     subtitle 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 by the 
     President, or such party subsequently consents to the release 
     of the information. To the extent a party submits 
     confidential business information, the party shall also 
     provide a nonconfidential version of the information in which 
     the confidential business information is summarized or, if 
     necessary, deleted.

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

     SEC. 341. FINDINGS AND ACTION ON KOREAN ARTICLES.

       (a) Effect of Imports.--If, in any investigation initiated 
     under chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.), the Commission makes an affirmative 
     determination (or a determination which the President may 
     treat as an affirmative determination under such chapter by 
     reason of section 330(d) of the Tariff Act of 1930 (19 U.S.C. 
     1330(d))), the Commission shall also find (and report to the 
     President at the time such injury determination is submitted 
     to the President) whether imports of the Korean article are a 
     substantial cause of serious injury or threat thereof.
       (b) Presidential Determination Regarding Korean Articles.--
     In determining the nature and extent of action to be taken 
     under chapter 1 of title II of the Trade Act of 1974 (19 
     U.S.C. 2251 et seq.), the President may exclude from the 
     action Korean articles with respect to which the Commission 
     has made a negative finding under subsection (a).

                         TITLE IV--PROCUREMENT

     SEC. 401. ELIGIBLE PRODUCTS.

       Section 308(4)(A) of the Trade Agreements Act of 1979 (19 
     U.S.C. 2518(4)(A)) is amended--
       (1) by striking ``or'' at the end of clause (vi);
       (2) by striking the period at the end of clause (vii) and 
     inserting ``; or''; and
       (3) by adding at the end the following new clause:
       ``(viii) a party to the United States-Korea Free Trade 
     Agreement, a product or service of that country or 
     instrumentality which is covered under that agreement for 
     procurement by the United States.''.

                            TITLE V--OFFSETS

     SEC. 501. INCREASE IN PENALTY ON PAID PREPARERS WHO FAIL TO 
                   COMPLY WITH EARNED INCOME TAX CREDIT DUE 
                   DILIGENCE REQUIREMENTS.

       (a) In General.--Section 6695(g) of the Internal Revenue 
     Code of 1986 is amended by striking ``$100'' and inserting 
     ``$500''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to returns required to be filed after December 
     31, 2011.

     SEC. 502. REQUIREMENT FOR PRISONS LOCATED IN THE UNITED 
                   STATES TO PROVIDE INFORMATION FOR TAX 
                   ADMINISTRATION.

       (a) In General.--Subchapter B of chapter 61 of the Internal 
     Revenue Code of 1986 is amended by redesignating section 6116 
     as section 6117 and by inserting after section 6115 the 
     following new section:

     ``SEC. 6116. REQUIREMENT FOR PRISONS LOCATED IN UNITED STATES 
                   TO PROVIDE INFORMATION FOR TAX ADMINISTRATION.

       ``(a) In General.--Not later than September 15, 2012, and 
     annually thereafter, the head of the Federal Bureau of 
     Prisons and the head of any State agency charged with the 
     responsibility for administration of prisons shall provide to 
     the Secretary in electronic format a list with the 
     information described in subsection (b) of all the inmates 
     incarcerated within the prison system for any part of the 
     prior 2 calendar years or the current calendar year through 
     August 31.
       ``(b) Information.--The information with respect to each 
     inmate is--
       ``(1) first, middle, and last name,
       ``(2) date of birth,
       ``(3) institution of current incarceration or, for released 
     inmates, most recent incarceration,
       ``(4) prison assigned inmate number,
       ``(5) the date of incarceration,
       ``(6) the date of release or anticipated date of release,
       ``(7) the date of work release,
       ``(8) taxpayer identification number and whether the prison 
     has verified such number,
       ``(9) last known address, and
       ``(10) any additional information as the Secretary may 
     request.
       ``(c) Format.--The Secretary shall determine the electronic 
     format of the information described in subsection (b).''.
       (b) Clerical Amendment.--The table of sections for such 
     subchapter is amended by striking the item relating to 
     section 6116 and by adding at the end the following new 
     items:

``Sec. 6116. Requirement for prisons located in United States to 
              provide information for tax administration.
``Sec. 6117. Cross reference.''.

     SEC. 503. RATE FOR MERCHANDISE PROCESSING FEES.

       For the period beginning on December 1, 2015, and ending on 
     June 30, 2021, section 13031(a)(9) of the Consolidated 
     Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 
     58c(a)(9)) shall be applied and administered--
       (1) in subparagraph (A), by substituting ``0.3464'' for 
     ``0.21''; and
       (2) in subparagraph (B)(i), by substituting ``0.3464'' for 
     ``0.21''.

     SEC. 504. EXTENSION OF CUSTOMS USER FEES.

       (a) In General.--Section 13031(j)(3)(A) of the Consolidated 
     Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 
     58c(j)(3)(A)) is amended by striking ``January 7, 2020'' and 
     inserting ``August 2, 2021''.
       (b) Other Fees.--Section 13031(j)(3)(B)(i) of the 
     Consolidated Omnibus Budget Reconciliation Act of 1985 (19 
     U.S.C. 58c(j)(3)(B)(i)) is amended by striking ``January 14, 
     2020'' and inserting ``December 8, 2020''.

     SEC. 505. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.

       Notwithstanding section 6655 of the Internal Revenue Code 
     of 1986, in the case of a corporation with assets of not less 
     than $1,000,000,000 (determined as of the end of the 
     preceding taxable year)--
       (1) the amount of any required installment of corporate 
     estimated tax which is otherwise due in July, August, or 
     September of 2012 shall be increased by 0.25 percent of such 
     amount (determined without regard to any increase in such 
     amount not contained in such Code);
       (2) the amount of any required installment of corporate 
     estimated tax which is otherwise due in July, August, or 
     September of 2016 shall be increased by 2.75 percent of such 
     amount (determined without regard to any increase in such 
     amount not contained in such Code); and
       (3) the amount of the next required installment after an 
     installment referred to in paragraph (1) or (2) shall be 
     appropriately reduced to reflect the amount of the increase 
     by reason of such paragraph.

  The SPEAKER pro tempore. The bill shall be debatable for 90 minutes, 
with 30 minutes controlled by the gentleman from Michigan (Mr. Camp), 
30 minutes controlled by the gentleman from Michigan (Mr. Levin), and 
30 minutes controlled by the gentleman from Maine (Mr. Michaud).
  The Chair recognizes the gentleman from Michigan (Mr. Camp).


                             General Leave

  Mr. CAMP. Madam Speaker, I ask unanimous consent that Members have 5 
legislative days in which to revise and extend their remarks.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  Mr. CAMP. Madam Speaker, I yield myself such time as I may consume.
  The U.S.-Korea agreement is the most commercially significant trade 
agreement considered by the Congress in 17 years, and it couldn't come 
at a better time. With the unemployment rate stuck stubbornly above 9 
percent, we must seek out and take advantage of all opportunities to 
create American jobs. This agreement, known as KORUS, will do just that 
by supporting hundreds of thousands of good-paying jobs in all sectors.
  Last year, I worked closely with the administration, the major auto 
makers, auto workers and Mr. Levin to address persistent barriers to 
U.S. automobile trade with South Korea. The supplemental agreement 
which is incorporated in the legislation before us today addresses key 
tariff and nontariff barriers, and includes numerous provisions to 
ensure that South Korea can no longer use its regulatory system to 
block U.S. exports.
  The International Trade Commission estimates that removal of 
nontariff barriers will add an additional $48 million to $66 million in 
new exports. This, in addition to the $194 million in expected new 
exports from lower Korean tariffs on U.S. autos.
  Inaction on KORUS has allowed the EU and other competitors to step in 
and steal U.S. market share and has diminished U.S. leadership in Asia. 
KORUS is key to our engagement in Asia and a critical bulwark to 
Chinese influence in the region. I call on the President to promptly 
enter this agreement into force so that our workers,

[[Page 15205]]

companies, farmers, and ranchers can get off the sidelines and 
recapture market share. KORUS and the other two agreements we will pass 
this week will create sustainable and well-paying jobs.
  Passage of KORUS will also deepen ties with a strong and important 
ally. The United States and South Korea have stood shoulder-to-shoulder 
for more than 60 years. KORUS is the next step forward in our bilateral 
relationship, and today's action could not come soon enough.
  I look forward to welcoming President Lee during his state visit 
tomorrow, and to congratulating him personally on passage of this 
important agreement.
  I reserve the balance of my time.
  Mr. LEVIN. It is now my distinct pleasure to yield 4 minutes to our 
whip, the gentleman from Maryland (Mr. Hoyer).
  Mr. HOYER. I thank the gentleman for yielding.
  I rise in support of the three trade agreements that are pending 
before us and in support of the Trade Adjustment Assistance for our 
working men and women in this country.
  There is no doubt, as so many of my colleagues have observed, that 
globalization of the marketplace and the growth of competitors from 
around the world has put a real stress on America and on American 
workers. As one of those who has fought very hard to have this floor 
consider legislation to facilitate making it in America, making sure 
that American workers are making American goods and selling them here 
and around the world, it seems to me that, in that process, what we 
need to do is bring down barriers to exports around the world. I 
perceive these three agreements accomplishing that objective.
  I want to congratulate my dear friend, Sandy Levin, as well as the 
chairman of the Ways and Means Committee, Mr. Camp, for working hard on 
all of these agreements. I particularly want to congratulate Mr. Levin, 
who has given such careful consideration and care to the development of 
agreements that he feels he can support. He is supporting Korea and 
Panama, as am I. He has concluded that the protections in Colombia are 
not yet sufficient to protect workers that we all want to protect. I 
share his concern there. I have transmitted that to the administration, 
as has Mr. Levin.
  I would like to read a portion of the submittal correspondence from 
the President of the United States referencing Colombia. The agreement 
contains state-of-the-art provisions to help protect and enforce 
intellectual property rights, reduce regulatory red tape, and eliminate 
regulatory barriers to U.S. exports.
  The agreement also contains the highest standard for protecting labor 
rights, carrying out covered environmental agreements, and ensuring 
that key domestic labor and environmental laws are enforced, combined 
with strong remedies for noncompliance.
  Colombia has already made significant reforms related to the 
obligations it will have under the labor chapter. A number of these 
steps have been taken in fulfillment of the commitments Colombia made 
in the agreed action plan.
  I want to again say that Mr. Levin has visited Colombia, spent time 
there and overseen the action plan and its implementation.
  But then the important sentence for me and I hope for others is, 
Colombia must successfully implement key elements of the action plan 
before I will bring the agreement into force.
  There is a bipartisan consensus, Madam Speaker, in favor of reducing 
trade barriers. Those who support expanded trade do so because we 
believe American companies can compete globally and export more of what 
our workers make right here in America.
  At the same time, though, trade agreements bring changes which may 
cause and do cause some workers to lose their jobs. That is why 
President Kennedy, in 1962, introduced a Trade Adjustment Assistance 
program to mitigate the negative effects of changes in trade policy. 
Under this program, the government provides job retraining, relocation 
allowances, and income assistance for those whose jobs are affected by 
international trade.
  For companies that lose business, the Federal Government lends a hand 
with guidance and financial assistance to help develop recovery plans. 
President Kennedy called it: ``A program to afford time for American 
initiative, American adaptability, and American resilience to assert 
themselves.'' I believe these agreements give us that continuing 
opportunity, but we must protect our workers in the process.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. HOYER. Mr. Camp, may I have a minute?
  Mr. CAMP. How much time do I have?
  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Camp) has 
28 minutes remaining.
  Mr. CAMP. I yield the gentleman 1 minute.

                              {time}  2150

  Mr. HOYER. I thank my friend for yielding.
  As we engage in measures designed to strengthen exports, at the same 
time Congress must continue to provide assistance to those whose jobs 
may be lost in the process. We need to do whatever we can to help get 
our people back to work and safeguard American jobs.
  I urge a vote in favor of the trade adjustment assistance. That will 
be the last item we will consider. And I indicate my support of all 
three of the agreements.
  In May of '07, we made definite progress with Mr. Levin's leadership 
and the leadership in a bipartisan way of saying workers' rights were 
going to be recognized in these agreements. In my view, that is the 
case in these three agreements. Are they perfect? I think no agreement 
is ever perfect. But do they move us in a position where the United 
States will be better able to make it in America and sell it abroad? I 
think they do; and, therefore, I will support these agreements.
  I thank the gentleman for yielding me the additional minute.
  Mr. MICHAUD. I yield 1 minute to the gentleman from Ohio (Mr. 
Kucinich).
  Mr. KUCINICH. Madam Speaker, this agreement is based on the NAFTA-
style trade model that has displaced and cut hundreds of thousands of 
jobs in the U.S. over the last decade. According to the Economic Policy 
Institute, this agreement is expected to increase our trade deficit 
with Korea by $16.7 billion and, in turn, cost the U.S. 159,000 jobs 
within the first 7 years of its implementation alone. Global Trade 
Watch states that it is expected to increase our trade deficit in autos 
and auto parts by $700 million, further devastating a domestic industry 
that's been in decline.
  I'm tired of visiting places where there's grass growing in parking 
lots in this country where they used to make steel and they used to 
make automotive products. It's time that we drew the line on behalf of 
American jobs and American workers and defeat this trade agreement.
  Mr. CAMP. I yield 2 minutes to the distinguished chairman of the 
Trade Subcommittee, the gentleman from Texas (Mr. Brady).
  Mr. BRADY of Texas. Madam Speaker, I want to thank Chairman Camp and 
Ranking Member Sandy Levin for working together with this President, 
with the Senate, and with the auto companies and autoworkers to improve 
this agreement to ensure we sell more American cars into Korea. This is 
why, among many other reasons, this agreement has so much strong 
bipartisan support.
  As I've already said tonight, I'm excited to be here. This trade 
agreement improves as well as strengthens our security relationship 
with one of our strongest allies. This is the most commercially 
significant trade agreement the United States has signed since I've 
been in Congress.
  The delay in implementing the sales agreement has been felt across 
America. If our exporters can't compete because of high tariffs or 
nontariff barriers, they can't grow their businesses and put Americans 
back to work. That's why expanding opportunities for U.S. exporters and 
finding new customers is so critical to our workers, so

[[Page 15206]]

critical to putting our economy back on the right track and creating 
good-paying American jobs right here in the United States.
  For example, this agreement turns one-way trade into the United 
States into two-way trade. The average South Korean tariff on our 
exporters is more than four times what it is when South Korea exports 
to us. This agreement addresses that imbalance.
  The job-creating benefits of this agreement will be enjoyed broadly 
among manufacturers, agriculture, service, and technology companies. 
The American Farm Bureau estimates that U.S. farm exports will increase 
by more than $1.8 billion to this market. Moreover, 90 percent of 
American companies selling to South Korea are small and medium-sized 
enterprises in our neighborhoods and in our communities, and it will 
lead to an additional $3 billion in exports for these small businesses.
  It's no longer enough to buy American; we have to sell American. And 
this ``Sell American'' agreement is essential if we are to get our 
economy back on track. I strongly support it.
  Mr. LEVIN. I reserve the balance of my time.
  Mr. MICHAUD. Madam Speaker, I yield 1 minute to the gentlewoman from 
Ohio (Ms. Kaptur).
  Ms. KAPTUR. I thank the gentleman from Maine for yielding and rise in 
opposition to the proposed South Korea trade accord.
  Look, my friends, South Korea's market is basically closed. You can't 
see any other cars on the road there other than Korean cars. And 
American policy has allowed jobs to be whittled away here at home 
through a trade agenda that outsources U.S. production and American 
jobs. Every single year we have a trade deficit with South Korea now. 
Why do we want to make it worse? Do you know what? The American people 
know it. They're living it. They want us to fix it. They're pouring out 
into the streets of America to tell us.
  Last year, our trade deficit with South Korea already was over $10 
billion. That translates into more lost jobs here at home. But rather 
than stopping this outsourcing of America, the executive branch and 
some of their allies up here keep concocting more of the same NAFTA-
type trade agreements that increase our trade deficit, and obviously 
even more with South Korea now.
  The Economic Policy Institute analysis predicts this proposed 
agreement with South Korea will cost us 159,000 more lost jobs, net, 
and the International Trade Commission verifies that.
  Isn't it time that we put Americans back to work here inside our 
country rather than giving them more of the same red ink?
  Mr. CAMP. At this time, I reserve the balance of my time.
  Mr. LEVIN. I continue to reserve the balance of my time.
  Mr. MICHAUD. I would now yield 1 minute to the gentleman from Iowa 
(Mr. Braley).
  Mr. BRALEY of Iowa. I thank the gentleman for yielding.
  Madam Speaker, I call on all my colleagues to oppose George Bush's 
job-killing trade deal with Korea. Listen to the American people: Only 
18 percent of Americans believe that free trade has created jobs in the 
United States. That's from the conservative Wall Street Journal poll. 
The same poll says that 53 percent of Americans say trade deals have 
hurt our country. Sixty-one percent of the Tea Party supporters say 
that free trade has hurt the United States.
  Facts don't lie. The simple truth is, during the last decade of so-
called free trade, the United States has lost 54,000 manufacturers and 
over 5 million manufacturing jobs--43,000 manufacturing jobs in my 
State of Iowa. That's 1,370 factory jobs lost every day at an average 
salary of $55,000.
  Wake up, America. We need to get serious about creating jobs, and 
passing more Bush-era, job-killing trade deals is not the answer. We 
have a trade deficit that has created a job deficit. That's what we 
need to solve.
  Mr. CAMP. Madam Speaker, I yield 1 minute to a distinguished member 
of the Ways and Means Committee, the gentleman from New York (Mr. 
Reed).
  Mr. REED. Thank you, Mr. Chairman.
  I rise today in strong support of the three pending agreements before 
this great body. This is a great day. This is a great day for America 
in the sense that we have before us an opportunity to create 250,000 
jobs. That's the administration's own number. That is the number that 
has been verified, and I am a supporter of that number in creating jobs 
for Americans across this entire Nation.
  Now, when I came here as a freshman Member of Congress, there was a 
big question about the freshman class's thoughts about free trade. And 
I was proud to be part of an effort that got 67 out of 87 freshman 
Republican Members to sign a letter to the administration to say that 
we support free and fair trade. Because when it's free and when it's 
fair, the American workers will outcompete anyone in the world. And 
that is exactly what these agreements will do.
  In particular, with the U.S.-Korea relationship, not only will we be 
strengthening a strategic relationship, we will be creating hundreds of 
thousands of jobs.
  With that, I support this bill.

                              {time}  2200

  Mr. MICHAUD. I yield 3 minutes to the gentlewoman from Ohio (Ms. 
Sutton).
  Ms. SUTTON. I thank the gentleman for the time.
  Madam Speaker, I rise today in opposition to all of the raw trade 
deals coming to the floor tomorrow, because our families cannot afford 
the loss of any more jobs.
  Based on the myth that there is some sort of world free market, they 
call these deals ``free trade agreements,'' but there is nothing free 
about them. These NAFTA-type deals are not free to our workers, who 
will lose their jobs because of them. They're not free for our 
communities when more of our factories are boarded up and when more 
careers are packed up and shipped overseas as some of our multinational 
corporations, with no allegiance to America, search the world over for 
the lowest wages to be found. Common sense tells us that pittance wages 
paid to workers in other countries, like low wages here, will not 
empower people to buy our products.
  Enough is enough, Madam Speaker.
  Some of the same people here on the floor who are claiming these 
deals level the playing field for American manufacturers and jobs 
supported NAFTA, too. How has that worked for us? Since NAFTA was 
signed, according to the Bureau of Labor Statistics, we've seen 
approximately 5 million manufacturing jobs lost--over 350,000 of those 
jobs from my State of Ohio. These are not free deals. They are raw 
deals for the American people.
  Make no mistake. The fact that we're seeing more trade adjustment 
assistance being offered for passage alongside these deals is an 
admission that more Americans are about to lose their jobs with these 
deals. At a time when so many are struggling to find jobs, why would we 
pass a deal that we know will result in job loss?
  It's unconscionable that we would pass a deal with Colombia where 
they have allowed trade unionists and those standing for civil rights 
to be killed with impunity. If we pass a deal with Korea, according to 
the Economic Policy Institute, we could see our trade deficit increase 
by another $14 billion, and we could see another 159,000 jobs lost.
  This raw deal would be particularly bad for my district and districts 
around the country that support our domestic auto industry--auto 
suppliers and parts makers. Right now, Korea has the largest trade 
imbalance when it comes to cars, only importing 5 percent of cars sold. 
This won't change that. In fact, it will only make it worse by allowing 
Korea to keep out American cars if they don't meet certain standards.
  Madam Speaker, enough is enough.
  This bad trade deal pours salt into the wound already festering 
within the American manufacturing sector, and it will destroy 
opportunities for people right here in the United States. The

[[Page 15207]]

American people don't want more bad free trade deals that aren't free.
  I encourage all of my colleagues to vote against this horrible, 
horrible package of trade deals. Enough is enough.
  Mr. CAMP. Madam Speaker, I yield 1 minute to the distinguished chair 
of the Foreign Affairs Committee, the gentlewoman from Florida (Ms. 
Ros-Lehtinen).
  Ms. ROS-LEHTINEN. I thank my good friend from Michigan for yielding.
  Madam Speaker, at a time when millions of American families are 
struggling and when so many people are looking for work, passage of 
this U.S.-South Korea Free Trade Agreement should be a top priority for 
all of us; but there is more at stake than just increased exports. 
South Korea is a key U.S. ally in an unstable region of the world where 
tens of thousands of our U.S. troops stand on guard against aggression 
and where U.S. interests are increasingly under threat from China and 
other countries.
  At a time when much of the world is waiting to see if the U.S. will 
retreat from our responsibilities, passage of this free trade agreement 
will serve as a clear demonstration of our enduring commitment to our 
ally South Korea and to our determination to defend our interests 
throughout East Asia.
  I strongly urge my colleagues to vote for this U.S.-South Korea Free 
Trade Agreement and for the creation of tens of thousands of American 
jobs for the many families who are desperately in need of them.
  Mr. MICHAUD. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Sherman).
  Mr. SHERMAN. It looks like the only thing Congress is going to do 
this year about jobs is to ship them overseas. Trade adjustment 
assistance is being authorized tomorrow, but not a penny is being 
appropriated tomorrow; and any penny that is appropriated will, no 
doubt, be taken from health and education spending necessary without 
the trade agreements.
  This South Korean Free Trade Agreement will increase our trade 
deficit by tens of billions of dollars, and every billion dollars of 
increase in our trade deficit costs us tens of thousands of jobs. The 
agreement is being sold as if goods made in South Korea are the only 
goods that are going to come into our country. That's wrong in three 
ways.
  First, if goods are 65 percent made in China, 35 percent finished in 
South Korea, they come into our country duty free; and that 35 percent 
of the work done in South Korea can be done by Chinese workers living 
in barracks in South Korea, so the goods may not ever be touched by a 
South Korean.
  We are going to be talking in this Congress, I hope, about Chinese 
currency manipulation. There are proposals that would impose tariffs on 
Chinese goods. This South Korean agreement is a prebuilt loophole in 
anything we try to do with China over currency manipulation. They 
manipulate their currency. They make 65 percent of the goods in China. 
They ship them to South Korea. They come in free to the United States 
without having to worry about our tariffs or our sanctions against 
their currency manipulation.
  Second, goods that are 65 percent made in North Korea, 35 percent 
made in South Korea have a right to come in under this agreement; but 
we have an executive order that will bar them at our ports, so we will 
be in violation of this agreement on the first day. That means South 
Korea can impose sanctions and take away whatever benefits you think 
we're going to get under this agreement.
  The SPEAKER pro tempore (Mr. Yoder). The time of the gentleman has 
expired.
  Mr. CAMP. Mr. Speaker, I have just one further request for time, so I 
reserve the balance of my time.
  Mr. LEVIN. I yield 2 minutes to the gentleman from California (Mr. 
Berman), the ranking member of the Foreign Affairs Committee.
  Mr. BERMAN. I thank my friend for yielding.
  I rise in support of the Korea trade agreement.
  The agreement will lead to increased California exports of 
manufactured goods, agricultural products and raw materials, thereby 
creating a large number of new jobs. It will also provide rigorous 
intellectual property protections for the creative industries in Los 
Angeles and throughout the Nation.
  I would like to use the remainder of my time to address the 
allegations that the agreement would undermine our sanctions against 
North Korea. There is no truth to those allegations. Under KORUS, we 
will continue to enforce our sanctions against North Korea just as we 
do now.
  The first allegation is that the agreement would allow North Korean 
goods produced at the Kaesong Industrial Complex in North Korea or 
elsewhere in that country to be imported into the United States. I 
raised this issue with Ambassador Kirk.
  His response in writing:
  ``Neither the rules of origin nor any other provision of KORUS 
changes U.S. sanctions on North Korea, including the prohibition on 
direct or indirect importation of goods, services and technology from 
North Korea.''
  He went on to say:
  ``South Korean firms cannot avoid U.S. sanctions by including parts 
from North Korea in their exports to the U.S. and claiming preferential 
tariff treatment.''

                              {time}  2210

  The second allegation is that South Korean firms might have recourse 
against U.S. sanctions targeted at North Korea, either under KORUS or 
under the WTO. Kirk's response, ``U.S. sanctions are fully consistent 
with KORUS, and therefore, South Korea would not be able to obtain 
remedies against U.S. sanctions using KORUS dispute settlement 
procedures. Nor does KORUS provide South Korea with any recourse to the 
WTO.''
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. LEVIN. I yield the gentleman an additional 30 seconds.
  Mr. BERMAN. According to the Congressional Research Service, article 
2.8.4(a), explicitly permits the U.S. to prohibit imports from a third 
country, such as North Korea. The fact is, we pass KORUS, our North 
Korean embargo stands; we defeat KORUS, our embargo stands. There are 
legitimate issues to debate regarding KORUS, but one should not let a 
bogus argument determine our vote.
  Mr. MICHAUD. Mr. Speaker, I yield 1 minute to the gentleman from 
Illinois (Mr. Lipinski).
  Mr. LIPINSKI. I thank the gentleman for yielding and for his 
leadership on this issue.
  Mr. Speaker, I cannot imagine a worse time for this job-killing trade 
agreement with South Korea. Expanding a NAFTA-style trade agenda that 
has already destroyed 5 million manufacturing jobs would make no sense 
in the best of times, but to do it when 25 million Americans are 
unemployed or underemployed, it is totally absurd now.
  Economists estimate that 159,000 American workers will lose their 
jobs over 7 years if we pass this agreement, most of these good-paying 
manufacturing jobs. In exchange, we likely get not only more Chinese 
imports, but we open up our country to imports from the nuclear 
dictatorship in North Korea. Manufacturers in my district know this. 
Workers in my district know this. It only seems that Washington is 
blind to this.
  It is well past time that Washington puts American workers and 
American manufacturers first. We can start by rejecting this trade 
agreement. We cannot hang our middle class out to dry any longer. We 
need to support American workers now.
  Mr. CAMP. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Minnesota (Mr. Paulsen), a distinguished member of the Ways and Means 
Committee.
  Mr. PAULSEN. I thank the chairman for his leadership because this is 
an exciting day, an important time for our economy. I strongly urge 
passage of all three of these long-stalled free trade agreements which 
will promote exports, with new sales to new customers, giving our 
economy more jobs. And while some in Washington have put these trade 
agreements on the back

[[Page 15208]]

burner, other countries have been moving full-speed ahead on trade. The 
European Union signed their own agreement with South Korea, which put 
American companies at a disadvantage in one of the great emerging Asian 
markets. Standing still on trade is moving our economy backwards.
  Mr. Speaker, passing the South Korea trade agreement is the quickest 
and most effective way to level the playing field for American 
companies, small, medium, and large. One of Minnesota's major employers 
with lots of jobs connected to trade is 3M, which manufactures everyday 
products from Post-It notes to Scotch tape to road signs to medical 
devices. South Korea is this company's fourth-largest export market, 
and the passage of this trade agreement will lower the duty rate levied 
on these American products by $20 million. This is about selling 
American. This will free up additional capital to create new jobs and 
reinvest in innovation and research and development to create new 
products.
  Mr. Speaker, we must remain focused on creating jobs and helping our 
economy. I strongly encourage the passage of the South Korea free trade 
agreement as well as the agreements with Panama and Colombia, marking 
the largest expansion of trade in 15 years.
  Mr. LEVIN. Could I inquire how much time remains for the three of us?
  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Levin) has 
23\1/2\ minutes remaining, the gentleman from Michigan (Mr. Camp) has 
21\1/2\ minutes remaining, and the gentleman from Maine (Mr. Michaud) 
has 21 minutes.
  Mr. CAMP. I have no further requests for time, so I will reserve the 
balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield myself 3\1/2\ minutes, but I may use 
only 2\1/2\.
  First I want to emphasize each of these agreements should be on their 
own merit. Trade is so polarized, it's easy to lump things all 
together. We won't carve out a new trade policy if that's the way we 
proceed.
  Secondly, there's been reference to NAFTA. This is really kind of an 
anti-NAFTA agreement. The labor standards are the new standards that we 
put into Peru and are incorporated here. The reference to job loss and 
EPI, it bases its assumption that what happened after NAFTA in terms of 
trade will happen as well with Korea. They are very different 
situations. And that's why many suggestions are that there will be 
major increases in jobs.
  Thirdly, there's been reference to this as the George Bush FTA. No, 
this is the FTA renegotiated by the Obama administration. And why was 
it renegotiated? To open up the markets of Korea, to change one-way 
trade to two-way trade. That's jobs. And that's exactly what this 
agreement does. Tomorrow we will outline how it does it. In all 
respects, it will make sure that the Korean market at long last is open 
to American automotive products, which is the major source of our trade 
deficit. That's why the automotive companies issued this statement: 
``As representatives of the largest exporting sector, this FTA will 
help open an important auto market for Chrysler, Ford, and GM exports. 
Our companies make the best cars and trucks on the road, and we are 
excited for the export opportunity this agreement represents.'' That's 
why it's supported by the UAW. It will open up markets. That's why Ford 
sat down today to describe how they're going to penetrate the market of 
Korea. They're determined to do that, as the other companies are. So 
this is a market-opening provision at long last, in that sense a major 
change from the Bush-negotiated agreement. I strongly urge support for 
the Korea FTA.
  I reserve the balance of my time.
  Mr. MICHAUD. Mr. Speaker, I yield 1 minute to a leader of the China 
currency manipulation legislation, the gentleman from Pennsylvania (Mr. 
Critz).
  Mr. CRITZ. I thank the gentleman from Maine for yielding.
  Mr. Speaker, I rise in opposition to the Korea free trade agreement. 
I represent a manufacturing district, and we need trade policies that 
put American workers first. I've seen firsthand the negative effects 
that trade agreements have had on our manufacturing sector. And this 
one is estimated to displace 159,000 jobs and increase our trade 
deficit with Korea by $16.7 billion.
  Every trade dollar we lose as a result of an international 
marketplace rigged against us is one more blow to our effort to climb 
out of debt and get our economy moving again. We can prevent the 
outsourcing and offshoring of American jobs and the ballooning of our 
trade deficit simply by basing trade agreements on a level playing 
field and rebuilding our manufacturing strength. In order to accomplish 
this, we must oppose agreements like this one that are founded on 
policies that have a record of failure.
  With an unemployment rate currently hovering around 9 percent and an 
11 million job shortfall, we simply cannot afford another trade 
agreement that increases the deficit and drives more Americans out of 
work. Please join me in opposing the Korea free trade agreement, as all 
our workers and businesses deserve to know that we are standing up for 
them in the global marketplace.
  The SPEAKER pro tempore. Pursuant to clause 1(c) of rule XIX, further 
consideration of H.R. 3080 is postponed.

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