[United States Statutes at Large, Volume 118, 108th Congress, 2nd Session] [From the U.S. Government Publishing Office, www.gpo.gov] 118 STAT. 1103 Public Law 108-302 108th Congress An Act To implement the United States-Morocco Free Trade Agreement. NOTE: Aug. 17, 2004 - [H.R. 4842] Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, NOTE: United States- Morocco Free Trade Agreement Implementation Act. 19 USC 3805 note. SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``United States- Morocco Free Trade Agreement Implementation Act''. (b) Table of Contents.--The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Purposes. Sec. 3. Definitions. TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT Sec. 101. Approval and entry into force of the Agreement. Sec. 102. Relationship of the Agreement to United States and State law. Sec. 103. Implementing actions in anticipation of entry into force and initial regulations. Sec. 104. Consultation and layover provisions for, and effective date of, proclaimed actions. Sec. 105. Administration of dispute settlement proceedings. Sec. 106. Arbitration of claims. Sec. 107. Effective dates; effect of termination. TITLE II--CUSTOMS PROVISIONS Sec. 201. Tariff modifications. Sec. 202. Additional duties on certain agricultural goods. Sec. 203. Rules of origin. Sec. 204. Enforcement relating to trade in textile and apparel goods. Sec. 205. Regulations. TITLE III--RELIEF FROM IMPORTS Sec. 301. Definitions. Subtitle A--Relief From Imports Benefiting From the Agreement Sec. 311. Commencing of action for relief. Sec. 312. Commission action on petition. Sec. 313. Provision of relief. Sec. 314. Termination of relief authority. Sec. 315. Compensation authority. Sec. 316. Confidential business information. Subtitle B--Textile and Apparel Safeguard Measures Sec. 321. Commencement of action for relief. Sec. 322. Determination and provision of relief. Sec. 323. Period of relief. Sec. 324. Articles exempt from relief. Sec. 325. Rate after termination of import relief. Sec. 326. Termination of relief authority. Sec. 327. Compensation authority. Sec. 328. Business confidential information. [[Page 1104]] 118 STAT. 1104 SEC. 2. NOTE: 19 USC 3805 note. PURPOSES. The purposes of this Act are-- (1) to approve and implement the Free Trade Agreement between the United States and Morocco entered into under the authority of section 2103(b) of the Bipartisan Trade Promotion Authority Act of 2002 (19 U.S.C. 3803(b)); (2) to strengthen and develop economic relations between the United States and Morocco for their mutual benefit; (3) to establish free trade between the 2 nations through the reduction and elimination of barriers to trade in goods and services and to investment; and (4) to lay the foundation for further cooperation to expand and enhance the benefits of such Agreement. SEC. 3. NOTE: 19 USC 3805 note. DEFINITIONS. In this Act: (1) Agreement.--The term ``Agreement'' means the United States-Morocco Free Trade Agreement approved by Congress under section 101(a)(1). (2) HTS.--The term ``HTS'' means the Harmonized Tariff Schedule of the United States. (3) Textile or apparel good.--The term ``textile or apparel good'' means a good listed in the Annex to the Agreement on Textiles and Clothing referred to in section 101(d)(4) of the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)). TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT SEC. 101. NOTE: 19 USC 3805 note. APPROVAL AND ENTRY INTO FORCE OF THE AGREEMENT. (a) Approval of Agreement and Statement of Administrative Action.-- Pursuant to section 2105 of the Bipartisan Trade Promotion Authority Act of 2002 (19 U.S.C. 3805) and section 151 of the Trade Act of 1974 (19 U.S.C. 2191), Congress approves-- (1) the United States-Morocco Free Trade Agreement entered into on June 15, 2004, with Morocco and submitted to Congress on July 15, 2004; and (2) the statement of administrative action proposed to implement the Agreement that was submitted to Congress on July 15, 2004. (b) NOTE: President. Effective date. Conditions for Entry Into Force of the Agreement.--At such time as the President determines that Morocco has taken measures necessary to bring it into compliance with those provisions of the Agreement that are to take effect on the date on which the Agreement enters into force, the President is authorized to exchange notes with the Government of Morocco providing for the entry into force, on or after January 1, 2005, of the Agreement with respect to the United States. SEC. 102. NOTE: 19 USC 3805 note. 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 [[Page 1105]] 118 STAT. 1105 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. NOTE: 19 USC 3805 note. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE AND INITIAL REGULATIONS. (a) Implementing Actions.-- (1) Proclamation authority.--After the date of the enactment of this Act-- (A) the President may proclaim such actions, and (B) other appropriate officers of the United States Government may issue such regulations, as may be necessary to ensure that any provision of this Act, or amendment made by this Act, that takes effect on the date the Agreement enters into force is appropriately implemented on such date, but no such proclamation or regulation may have an effective date earlier than the date the Agreement enters into force. (2) Effective date of certain proclaimed actions.--Any action proclaimed by the President under the authority of this Act that is not subject to the consultation and layover provisions under section 104 may not take effect before the 15th day after the date on which the text of the proclamation is published in the Federal Register. (3) Waiver of 15-day restriction.--The 15-day restriction in paragraph (2) on the taking effect of proclaimed actions is waived to the extent that the application of such restriction would prevent the taking effect on the date the Agreement enters into force of any action proclaimed under this section. [[Page 1106]] 118 STAT. 1106 (b) NOTE: Deadlines. 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. NOTE: President. 19 USC 3805 note. CONSULTATION AND LAYOVER PROVISIONS FOR, AND EFFECTIVE DATE OF, PROCLAIMED ACTIONS. If a provision of this Act provides that the implementation of an action by the President by proclamation is subject to the consultation and layover requirements of this section, such action may be proclaimed only if-- (1) the President has obtained advice regarding the proposed action from-- (A) the appropriate advisory committees established under section 135 of the Trade Act of 1974 (19 U.S.C. 2155); and (B) the United States International Trade Commission; (2) the President has submitted to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives a report that sets forth-- (A) the action proposed to be proclaimed and the reasons therefor; and (B) the advice obtained under paragraph (1); (3) a period of 60 calendar days, beginning on the first day on which the requirements set forth in paragraphs (1) and (2) have been met has expired; and (4) the President has consulted with such Committees regarding the proposed action during the period referred to in paragraph (3). SEC. 105. NOTE: 19 USC 3805 note. President. ADMINISTRATION OF DISPUTE SETTLEMENT PROCEEDINGS. (a) Establishment or Designation of Office.--The President is authorized to establish or designate within the Department of Commerce an office that shall be responsible for providing administrative assistance to panels established under chapter 20 of the Agreement. The office may not be considered to be an agency for purposes of section 552 of title 5, United States Code. (b) Authorization of Appropriations.--There are authorized to be appropriated for each fiscal year after fiscal year 2004 to the Department of Commerce such sums as may be necessary for the establishment and operations of the office under subsection (a) and for the payment of the United States share of the expenses of panels established under chapter 20 of the Agreement. SEC. 106. NOTE: 19 USC 3805 note. ARBITRATION OF CLAIMS. The United States is authorized to resolve any claim against the United States covered by article 10.15.1(a)(i)(C) or article 10.15.1(b)(i)(C) of the Agreement, pursuant to the Investor-State Dispute Settlement procedures set forth in section B of chapter 10 of the Agreement. [[Page 1107]] 118 STAT. 1107 SEC. 107. NOTE: 19 USC 3805 note. EFFECTIVE DATES; EFFECT OF TERMINATION. (a) Effective Dates.--Except as provided in subsection (b), the provisions of this Act and the amendments made by this Act take effect on the date the Agreement enters into force. (b) Exceptions.--Sections 1 through 3 and this title take effect on the date of the enactment of this Act. (c) Termination of the Agreement.--On the date on which the Agreement terminates, the provisions of this Act (other than this subsection) and the amendments made by this Act shall cease to be effective. TITLE II--CUSTOMS PROVISIONS SEC. 201. NOTE: 19 USC 3805 note. TARIFF MODIFICATIONS. (a) Tariff Modifications Provided for in the Agreement.-- (1) Proclamation authority.--The President may proclaim-- (A) such modifications or continuation of any duty, (B) such continuation of duty-free or excise treatment, or (C) such additional duties, as the President determines to be necessary or appropriate to carry out or apply articles 2.3, 2.5, 2.6, 4.1, 4.3.9, 4.3.10, 4.3.11, 4.3.13, 4.3.14, and 4.3.15, and Annex IV of the Agreement. (2) NOTE: President. Termination date. Effect on moroccan gsp status.--Notwithstanding section 502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)), the President shall terminate the designation of Morocco as a beneficiary developing country for purposes of title V of the Trade Act of 1974 on the date of entry into force of the Agreement. (b) Other Tariff Modifications.--Subject to the consultation and layover provisions of section 104, the President may proclaim-- (1) such modifications or continuation of any duty, (2) such modifications as the United States may agree to with Morocco regarding the staging of any duty treatment set forth in Annex IV of the Agreement, (3) such continuation of duty-free or excise treatment, or (4) such additional duties, as the President determines to be necessary or appropriate to maintain the general level of reciprocal and mutually advantageous concessions with respect to Morocco provided for by the Agreement. (c) Conversion to Ad Valorem Rates.--For purposes of subsections (a) and (b), with respect to any good for which the base rate in the Tariff Schedule of the United States to Annex IV of the Agreement is a specific or compound rate of duty, the President may substitute for the base rate an ad valorem rate that the President determines to be equivalent to the base rate. SEC. 202. NOTE: 19 USC 3805 note. ADDITIONAL DUTIES ON CERTAIN AGRICULTURAL GOODS. (a) Definitions.--In this section: (1) Agricultural safeguard good.--The term ``agricultural safeguard good'' means a good-- (A) that qualifies as an originating good under section 203; [[Page 1108]] 118 STAT. 1108 (B) that is included in the U.S. Agricultural Safeguard List set forth in Annex 3-A of the Agreement; and (C) for which a claim for preferential treatment under the Agreement has been made. (2) Applicable ntr (mfn) rate of duty.--The term ``applicable NTR (MFN) rate of duty'' means, with respect to an agricultural safeguard good, a rate of duty that is the lesser of-- (A) the column 1 general rate of duty that would have been imposed under the HTS on the same agricultural safeguard good entered, without a claim for preferential tariff treatment, on the date on which the additional duty is imposed under subsection (b); or (B) the column 1 general rate of duty that would have been imposed under the HTS on the same agricultural safeguard good entered, without a claim for preferential tariff treatment, on December 31, 2004. (3) F.O.B.--The term ``F.O.B.'' means free on board, regardless of the mode of transportation, at the point of direct shipment by the seller to the buyer. (4) Schedule rate of duty.--The term ``schedule rate of duty'' means, with respect to an agricultural safeguard good, the rate of duty for that good set out in the Tariff Schedule of the United States to Annex IV of the Agreement. (5) Trigger price.--The ``trigger price'' for a good means the trigger price indicated for that good in the U.S. Agricultural Safeguard List set forth in Annex 3-A of the Agreement or any amendment thereto. (6) Unit import price.--The ``unit import price'' of a good means the price of the good determined on the basis of the F.O.B. import price of the good, expressed in either dollars per kilogram or dollars per liter, whichever unit of measure is indicated for the good in the U.S. Agricultural Safeguard List set forth in Annex 3-A of the Agreement. (b) Additional Duties on Agricultural Safeguard Goods.-- (1) Additional duties.--In addition to any duty proclaimed under subsection (a) or (b) of section 201, and subject to paragraphs (3), (4), (5), and (6) of this subsection, the Secretary of the Treasury shall assess a duty on an agricultural safeguard good, in the amount determined under paragraph (2), if the Secretary determines that the unit import price of the good when it enters the United States is less than the trigger price for that good. (2) Calculation of additional duty.--The additional duty assessed under this subsection on an agricultural safeguard good shall be an amount determined in accordance with the following table: If the excess of the trigger price The additional duty is an over the unit import price is: amount equal to: Not more than 10 percent of the 0. trigger price........................ [[Page 1109]] 118 STAT. 1109 More than 10 percent but not more than 30 percent of the excess of the applicable NTR (MFN) rate of duty 40 percent of the trigger price...... over the schedule rate of duty. More than 40 percent but not more than 50 percent of such excess. 60 percent of the trigger price...... More than 60 percent but not more than 70 percent of such excess. 75 percent of the trigger price...... More than 75 percent of the trigger 100 percent of such excess. price................................ (3) Exceptions.--No additional duty shall be assessed on a good under this subsection if, at the time of entry, the good is subject to import relief under-- (A) subtitle A of title III of this Act; or (B) chapter 1 of title II of the Trade Act of 1974 (19 U.S.C. 2251 et seq.). (4) Termination.--The assessment of an additional duty on a good under this subsection shall cease to apply to that good on the date on which duty-free treatment must be provided to that good under the Tariff Schedule of the United States to Annex IV of the Agreement. (5) Tariff-rate quotas.--If an agricultural safeguard good is subject to a tariff-rate quota under the Agreement, any additional duty assessed under this subsection shall be applied only to over-quota imports of the good. (6) NOTE: Deadline. Notice.--Not later than 60 days after the date on which the Secretary of the Treasury assesses an additional duty on a good under this subsection, the Secretary shall notify the Government of Morocco in writing of such action and shall provide to the Government of Morocco data supporting the assessment of additional duties. SEC. 203. NOTE: 19 USC 3805 note. RULES OF ORIGIN. (a) Application and Interpretation.--In this section: (1) Tariff classification.--The basis for any tariff classification is the HTS. (2) Reference to hts.--Whenever in this section there is a reference to a heading or sub-heading, such reference shall be a reference to a heading or subheading of the HTS. (b) Originating Goods.-- (1) In general.--For purposes of this Act and for purposes of implementing the preferential tariff treatment provided for under the Agreement, a good is an originating good if-- (A) the good is imported directly-- (i) from the territory of Morocco into the territory of the United States; or (ii) from the territory of the United States into the territory of Morocco; and (B)(i) the good is a good wholly the growth, product, or manufacture of Morocco or the United States, or both; (ii) the good (other than a good to which clause (iii) applies) is a new or different article of commerce that has been grown, produced, or manufactured in Morocco, the United States, or both, and meets the requirements of paragraph (2); or (iii)(I) the good is a good covered by Annex 4-A or 5-A of the Agreement; [[Page 1110]] 118 STAT. 1110 (II)(aa) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in such Annex as a result of production occurring entirely in the territory of Morocco or the United States, or both; or (bb) the good otherwise satisfies the requirements specified in such Annex; and (III) the good satisfies all other applicable requirements of this section. (2) Requirements.--A good described in paragraph (1)(B)(ii) is an originating good only if the sum of-- (A) the value of each material produced in the territory of Morocco or the United States, or both, and (B) the direct costs of processing operations performed in the territory of Morocco or the United States, or both, is not less than 35 percent of the appraised value of the good at the time the good is entered into the territory of the United States. (c) Cumulation.-- (1) Originating good or material incorporated into goods of other country.--An originating good or a material produced in the territory of Morocco or the United States, or both, that is incorporated into a good in the territory of the other country shall be considered to originate in the territory of the other country. (2) Multiple procedures.--A good that is grown, produced, or manufactured in the territory of Morocco or the United States, or both, by 1 or more producers, is an originating good if the good satisfies the requirements of subsection (b) and all other applicable requirements of this section. (d) Value of Materials.-- (1) In general.--Except as provided in paragraph (2), the value of a material produced in the territory of Morocco or the United States, or both, includes the following: (A) The price actually paid or payable for the material by the producer of such good. (B) The freight, insurance, packing, and all other costs incurred in transporting the material to the producer's plant, if such costs are not included in the price referred to in subparagraph (A). (C) The cost of waste or spoilage resulting from the use of the material in the growth, production, or manufacture of the good, less the value of recoverable scrap. (D) Taxes or customs duties imposed on the material by Morocco, the United States, or both, if the taxes or customs duties are not remitted upon exportation from the territory of Morocco or the United States, as the case may be. (2) Exception.--If the relationship between the producer of a good and the seller of a material influenced the price actually paid or payable for the material, or if there is no price actually paid or payable by the producer for the material, the value of the material produced in the territory of Morocco or the United States, or both, includes the following: (A) All expenses incurred in the growth, production, or manufacture of the material, including general expenses. (B) A reasonable amount for profit. [[Page 1111]] 118 STAT. 1111 (C) Freight, insurance, packing, and all other costs incurred in transporting the material to the producer's plant. (e) Packaging and Packing Materials and Containers for Retail Sale and for Shipment.--Packaging and packing materials and containers for retail sale and shipment shall be disregarded in determining whether a good qualifies as an originating good, except to the extent that the value of such packaging and packing materials and containers have been included in meeting the requirements set forth in subsection (b)(2). (f) Indirect Materials.--Indirect materials shall be disregarded in determining whether a good qualifies as an originating good, except that the cost of such indirect materials may be included in meeting the requirements set forth in subsection (b)(2). (g) Transit and Transshipment.--A good shall not be considered to meet the requirement of subsection (b)(1)(A) if, after exportation from the territory of Morocco or the United States, the good undergoes production, manufacturing, or any other operation outside the territory of Morocco or the United States, other than unloading, reloading, or any other operation necessary to preserve the good in good condition or to transport the good to the territory of the United States or Morocco. (h) Textile and Apparel Goods.-- (1) De minimis amounts of nonoriginating materials.-- (A) In general.--Except as provided in subparagraph (B), a textile or apparel good that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in Annex 4-A of the Agreement shall be considered to be an originating good if the total weight of all such fibers or yarns in that component is not more than 7 percent of the total weight of that component. (B) Certain textile or apparel goods.--A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of Morocco or the United States. (C) Yarn, fabric, or group of fibers.--For purposes of this paragraph, in the case of a textile or apparel good that is a yarn, fabric, or group of fibers, the term ``component of the good that determines the tariff classification of the good'' means all of the fibers in the yarn, fabric, or group of fibers. (2) Goods put up in sets for retail sale.--Notwithstanding the rules set forth in Annex 4-A of the Agreement, textile or apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the HTS shall not be considered to be originating goods unless each of the goods in the set is an originating good or the total value of the nonoriginating goods in the set does not exceed 10 percent of the value of the set determined for purposes of assessing customs duties. (i) Definitions.--In this section: (1) Direct costs of processing operations.-- [[Page 1112]] 118 STAT. 1112 (A) In general.--The term ``direct costs of processing operations'', with respect to a good, includes, to the extent they are includable in the appraised value of the good when imported into Morocco or the United States, as the case may be, the following: (i) All actual labor costs involved in the growth, production, or manufacture of the good, including fringe benefits, on-the-job training, and the costs of engineering, supervisory, quality control, and similar personnel. (ii) Tools, dies, molds, and other indirect materials, and depreciation on machinery and equipment that are allocable to the good. (iii) Research, development, design, engineering, and blueprint costs, to the extent that they are allocable to the good. (iv) Costs of inspecting and testing the good. (v) Costs of packaging the good for export to the territory of the other country. (B) Exceptions.--The term ``direct costs of processing operations'' does not include costs that are not directly attributable to a good or are not costs of growth, production, or manufacture of the good, such as-- (i) profit; and (ii) general expenses of doing business that are either not allocable to the good or are not related to the growth, production, or manufacture of the good, such as administrative salaries, casualty and liability insurance, advertising, and sales staff salaries, commissions, or expenses. (2) Good.--The term ``good'' means any merchandise, product, article, or material. (3) Good wholly the growth, product, or manufacture of morocco, the united states, or both.--The term ``good wholly the growth, product, or manufacture of Morocco, the United States, or both'' means-- (A) a mineral good extracted in the territory of Morocco or the United States, or both; (B) a vegetable good, as such a good is provided for in the HTS, harvested in the territory of Morocco or the United States, or both; (C) a live animal born and raised in the territory of Morocco or the United States, or both; (D) a good obtained from live animals raised in the territory of Morocco or the United States, or both; (E) a good obtained from hunting, trapping, or fishing in the territory of Morocco or the United States, or both; (F) a good (fish, shellfish, and other marine life) taken from the sea by vessels registered or recorded with Morocco or the United States and flying the flag of that country; (G) a good produced from goods referred to in subparagraph (F) on board factory ships registered or recorded with Morocco or the United States and flying the flag of that country; (H) a good taken by Morocco or the United States or a person of Morocco or the United States from the seabed or beneath the seabed outside territorial waters, [[Page 1113]] 118 STAT. 1113 if Morocco or the United States has rights to exploit such seabed; (I) a good taken from outer space, if such good is obtained by Morocco or the United States or a person of Morocco or the United States and not processed in the territory of a country other than Morocco or the United States; (J) waste and scrap derived from-- (i) production or manufacture in the territory of Morocco or the United States, or both; or (ii) used goods collected in the territory of Morocco or the United States, or both, if such goods are fit only for the recovery of raw materials; (K) a recovered good derived in the territory of Morocco or the United States from used goods and utilized in the territory of that country in the production of remanufactured goods; and (L) a good produced in the territory of Morocco or the United States, or both, exclusively-- (i) from goods referred to in subparagraphs (A) through (J), or (ii) from the derivatives of goods referred to in clause (i), at any stage of production. (4) Indirect material.--The term ``indirect material'' means a good used in the growth, production, manufacture, testing, or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the growth, production, or manufacture of a good, including-- (A) fuel and energy; (B) tools, dies, and molds; (C) spare parts and materials used in the maintenance of equipment and buildings; (D) lubricants, greases, compounding materials, and other materials used in the growth, production, or manufacture of a good or used to operate equipment and buildings; (E) gloves, glasses, footwear, clothing, safety equipment, and supplies; (F) equipment, devices, and supplies used for testing or inspecting the good; (G) catalysts and solvents; and (H) any other goods that are not incorporated into the good but the use of which in the growth, production, or manufacture of the good can reasonably be demonstrated to be a part of that growth, production, or manufacture. (5) Material.--The term ``material'' means a good, including a part or ingredient, that is used in the growth, production, or manufacture of another good that is a new or different article of commerce that has been grown, produced, or manufactured in Morocco, the United States, or both. (6) Material produced in the territory of morocco or the united states, or both.--The term ``material produced in the territory of Morocco or the United States, or both'' means a good that is either wholly the growth, product, or manufacture of Morocco, the United States, or both, or a new or different article of commerce that has been grown, produced, [[Page 1114]] 118 STAT. 1114 or manufactured in the territory of Morocco or the United States, or both. (7) New or different article of commerce.-- (A) In general.--The term ``new or different article of commerce'' means, except as provided in subparagraph (B), a good that-- (i) has been substantially transformed from a good or material that is not wholly the growth, product, or manufacture of Morocco, the United States, or both; and (ii) has a new name, character, or use distinct from the good or material from which it was transformed. (B) Exception.--A good shall not be considered a new or different article of commerce by virtue of having undergone simple combining or packaging operations, or mere dilution with water or another substance that does not materially alter the characteristics of the good. (8) Recovered goods.--The term ``recovered goods'' means materials in the form of individual parts that result from-- (A) the complete disassembly of used goods into individual parts; and (B) the cleaning, inspecting, testing, or other processing of those parts that is necessary for improvement to sound working condition. (9) Remanufactured good.--The term ``remanufactured good'' means an industrial good that is assembled in the territory of Morocco or the United States and that-- (A) is entirely or partially comprised of recovered goods; (B) has a similar life expectancy to, and meets similar performance standards as, a like good that is new; and (C) enjoys a factory warranty similar to that of a like good that is new. (10) Simple combining or packaging operations.--The term ``simple combining or packaging operations'' means operations such as adding batteries to electronic devices, fitting together a small number of components by bolting, gluing, or soldering, or packing or repacking components together. (11) Substantially transformed.--The term ``substantially transformed'' means, with respect to a good or material, changed as the result of a manufacturing or processing operation so that-- (A)(i) the good or material is converted from a good that has multiple uses into a good or material that has limited uses; (ii) the physical properties of the good or material are changed to a significant extent; or (iii) the operation undergone by the good or material is complex by reason of the number of processes and materials involved and the time and level of skill required to perform those processes; and (B) the good or material loses its separate identity in the manufacturing or processing operation. (j) Presidential Proclamation Authority.-- (1) In general.--The President is authorized to proclaim, as part of the HTS-- [[Page 1115]] 118 STAT. 1115 (A) the provisions set out in Annex 4-A and Annex 5- A of the Agreement; and (B) any additional subordinate category necessary to carry out this title consistent with the Agreement. (2) Modifications.-- (A) In general.--Subject to the consultation and layover provisions of section 104, the President may proclaim modifications to the provisions proclaimed under the authority of paragraph (1)(A), other than provisions of chapters 50 through 63 of the HTS, as included in Annex 4-A of the Agreement. (B) Additional proclamations.--Notwithstanding subparagraph (A), and subject to the consultation and layover provisions of section 104, the President may proclaim-- (i) modifications to the provisions proclaimed under the authority of paragraph (1)(A) as are necessary to implement an agreement with Morocco pursuant to article 4.3.6 of the Agreement; and (ii) before the end of the 1-year period beginning on the date of the enactment of this Act, modifications to correct any typographical, clerical, or other nonsubstantive technical error regarding the provisions of chapters 50 through 63 of the HTS, as included in Annex 4-A of the Agreement. SEC. 204. NOTE: 19 USC 3805 note. ENFORCEMENT RELATING TO TRADE IN TEXTILE AND APPAREL GOODS. (a) Action During Verification.-- (1) In general.--If the Secretary of the Treasury requests the Government of Morocco to conduct a verification pursuant to article 4.4 of the Agreement for purposes of making a determination under paragraph (2), the President may direct the Secretary to take appropriate action described in subsection (b) while the verification is being conducted. (2) Determination.--A determination under this paragraph is a determination-- (A) that an exporter or producer in Morocco is complying with applicable customs laws, regulations, procedures, requirements, or practices affecting trade in textile or apparel goods; or (B) that a claim that a textile or apparel good exported or produced by such exporter or producer-- (i) qualifies as an originating good under section 203 of this Act, or (ii) is a good of Morocco, is accurate. (b) Appropriate Action Described.--Appropriate action under subsection (a)(1) includes-- (1) suspension of liquidation of the entry of any textile or apparel good exported or produced by the person that is the subject of a verification referred to in subsection (a)(1) regarding compliance described in subsection (a)(2)(A), in a case in which the request for verification was based on a reasonable suspicion of unlawful activity related to such goods; and [[Page 1116]] 118 STAT. 1116 (2) suspension of liquidation of the entry of a textile or apparel good for which a claim has been made that is the subject of a verification referred to in subsection (a)(1) regarding a claim described in subsection (a)(2)(B). (c) Action When Information is Insufficient.--If the Secretary of the Treasury determines that the information obtained within 12 months after making a request for a verification under subsection (a)(1) is insufficient to make a determination under subsection (a)(2), the President may direct the Secretary to take appropriate action described in subsection (d) until such time as the Secretary receives information sufficient to make a determination under subsection (a)(2) or until such earlier date as the President may direct. (d) Appropriate Action Described.--Appropriate action referred to in subsection (c) includes-- (1) publication of the name and address of the person that is the subject of the verification; (2) denial of preferential tariff treatment under the Agreement to-- (A) any textile or apparel good exported or produced by the person that is the subject of a verification referred to in subsection (a)(1) regarding compliance described in subsection (a)(2)(A); or (B) a textile or apparel good for which a claim has been made that is the subject of a verification referred to in subsection (a)(1) regarding a claim described in subsection (a)(2)(B); and (3) denial of entry into the United States of-- (A) any textile or apparel good exported or produced by the person that is the subject of a verification referred to in subsection (a)(1) regarding compliance described in subsection (a)(2)(A); or (B) a textile or apparel good for which a claim has been made that is the subject of a verification referred to in subsection (a)(1) regarding a claim described in subsection (a)(2)(B). SEC. 205. NOTE: 19 USC 3805 note. REGULATIONS. The Secretary of the Treasury shall prescribe such regulations as may be necessary to carry out-- (1) subsections (a) through (i) of section 203; (2) amendments to existing law made by the subsections referred to in paragraph (1); and (3) proclamations issued under section 203(j). TITLE III--RELIEF FROM IMPORTS SEC. 301. NOTE: 19 USC 3805 note. DEFINITIONS. In this title: (1) Moroccan article.--The term ``Moroccan article'' means an article that qualifies as an originating good under section 203(b) of this Act or receives preferential tariff treatment under paragraphs 9 through 15 of article 4.3 of the Agreement. (2) Moroccan textile or apparel article.--The term ``Moroccan textile or apparel article'' means an article that-- [[Page 1117]] 118 STAT. 1117 (A) is listed in the Annex to the Agreement on Textiles and Clothing referred to in section 101(d)(4) of the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)); and (B) is a Moroccan article. (3) Commission.--The term ``Commission'' means the United States International Trade Commission. Subtitle A--Relief From Imports Benefiting From the Agreement SEC. 311. NOTE: 19 USC 3805 note. COMMENCING OF ACTION FOR RELIEF. (a) Filing of Petition.-- (1) In general.--A petition requesting action under this subtitle for the purpose of adjusting to the obligations of the United States under the Agreement may be filed with the Commission by an entity, including a trade association, firm, certified or recognized union, or group of workers, that is representative of an industry. The Commission shall transmit a copy of any petition filed under this subsection to the United States Trade Representative. (2) Provisional relief.--An entity filing a petition under this subsection may request that provisional relief be provided as if the petition had been filed under section 202(a) of the Trade Act of 1974 (19 U.S.C. 2252(a)). (3) Critical circumstances.--Any allegation that critical circumstances exist shall be included in the petition. (b) Investigation and Determination.--Upon the filing of a petition under subsection (a), the Commission, unless subsection (d) applies, shall promptly initiate an investigation to determine whether, as a result of the reduction or elimination of a duty provided for under the Agreement, a Moroccan article is being imported into the United States in such increased quantities, in absolute terms or relative to domestic production, and under such conditions that imports of the Moroccan article constitute a substantial cause of serious injury or threat thereof to the domestic industry producing an article that is like, or directly competitive with, the imported article. (c) Applicable Provisions.--The following provisions of section 202 of the Trade Act of 1974 (19 U.S.C. 2252) apply with respect to any investigation initiated under subsection (b): (1) Paragraphs (1)(B) and (3) of subsection (b). (2) Subsection (c). (3) Subsection (d). (4) Subsection (i). (d) Articles Exempt From Investigation.--No investigation may be initiated under this section with respect to any Moroccan article if, after the date on which the Agreement enters into force, import relief has been provided with respect to that Moroccan article under this subtitle. SEC. 312. NOTE: 19 USC 3805 note. Deadline. 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. [[Page 1118]] 118 STAT. 1118 (b) Applicable Provisions.--For purposes of this subtitle, the provisions of paragraphs (1), (2), and (3) of section 330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2), and (3)) shall be applied with respect to determinations and findings made under this section as if such determinations and findings were made under section 202 of the Trade Act of 1974 (19 U.S.C. 2252). (c) Additional Finding and Recommendation if Determination Affirmative.--If the determination made by the Commission under subsection (a) with respect to imports of an article is affirmative, or if the President may consider a determination of the Commission to be an affirmative determination as provided for under paragraph (1) of section 330(d) of the Tariff Act of 1930) (19 U.S.C. 1330(d)), the Commission shall find, and recommend to the President in the report required under subsection (d), the amount of import relief that is necessary to remedy or prevent the injury found by the Commission in the determination and to facilitate the efforts of the domestic industry to make a positive adjustment to import competition. The import relief recommended by the Commission under this subsection shall be limited to that described in section 313(c). Only those members of the Commission who voted in the affirmative under subsection (a) are eligible to vote on the proposed action to remedy or prevent the injury found by the Commission. Members of the Commission who did not vote in the affirmative may submit, in the report required under subsection (d), separate views regarding what action, if any, should be taken to remedy or prevent the injury. (d) Report to President.--Not later than the date that is 30 days after the date on which a determination is made under subsection (a) with respect to an investigation, the Commission shall submit to the President a report that includes-- (1) the determination made under subsection (a) and an explanation of the basis for the determination; (2) if the determination under subsection (a) is affirmative, any findings and recommendations for import relief made under subsection (c) and an explanation of the basis for each recommendation; and (3) any dissenting or separate views by members of the Commission regarding the determination and recommendation referred to in paragraphs (1) and (2). (e) NOTE: Federal Register, publication. Public Notice.--Upon submitting a report to the President under subsection (d), the Commission shall promptly make public such report (with the exception of information which the Commission determines to be confidential) and shall cause a summary thereof to be published in the Federal Register. SEC. 313. NOTE: 19 USC 3805 note. Deadline. President. PROVISION OF RELIEF. (a) In General.--Not later than the date that is 30 days after the date on which the President receives the report of the Commission in which the Commission's determination under section 312(a) is affirmative, or which contains a determination under section 312(a) that the President considers to be affirmative under paragraph (1) of section 330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)(1)), the President, subject to subsection (b), shall provide relief from imports of the article that is the subject of such determination to the extent that the President determines necessary to remedy or prevent the injury found by the Commission and [[Page 1119]] 118 STAT. 1119 to facilitate the efforts of the domestic industry to make a positive adjustment to import competition. (b) Exception.--The President is not required to provide import relief under this section if the President determines that the provision of the import relief will not provide greater economic and social benefits than costs. (c) Nature of Relief.-- (1) In general.--The import relief (including provisional relief) that the President is authorized to provide under this section with respect to imports of an article is as follows: (A) The suspension of any further reduction provided for under Annex IV of the Agreement in the duty imposed on such article. (B) An increase in the rate of duty imposed on such article to a level that does not exceed the lesser of-- (i) the column 1 general rate of duty imposed under the HTS on like articles at the time the import relief is provided; or (ii) the column 1 general rate of duty imposed under the HTS on like articles on the day before the date on which the Agreement enters into force. (C) In the case of a duty applied on a seasonal basis to such article, an increase in the rate of duty imposed on the article to a level that does not exceed the lesser of-- (i) the column 1 general rate of duty imposed under the HTS on like articles for the immediately preceding corresponding season; or (ii) the column 1 general rate of duty imposed under the HTS on like articles on the day before the date on which the Agreement enters into force. (2) NOTE: President. Progressive liberalization.--If the period for which import relief is provided under this section is greater than 1 year, the President shall provide for the progressive liberalization of such relief at regular intervals during the period in which the relief is in effect. (d) Period of Relief.-- (1) In general.--Subject to paragraph (2), any import relief that the President provides under this section may not be in effect for more than 3 years. (2) Extension.-- (A) In general.--Subject to subparagraph (C), the President, after receiving an affirmative determination from the Commission under subparagraph (B), may extend the effective period of any import relief provided under this section if the President determines that-- (i) the import relief continues to be necessary to remedy or prevent serious injury and to facilitate adjustment by the domestic industry to import competition; and (ii) there is evidence that the industry is making a positive adjustment to import competition. (B) NOTE: Deadline. Action by commission.--(i) Upon a petition on behalf of the industry concerned that is filed with the Commission not earlier than the date which is 9 months, and not later than the date which is 6 months, before [[Page 1120]] 118 STAT. 1120 the date any action taken under subsection (a) is to terminate, the Commission shall conduct an investigation to determine whether action under this section continues to be necessary to remedy or prevent serious injury and to facilitate adjustment by the domestic industry to import competition and whether there is evidence that the industry is making a positive adjustment to import competition. (ii) NOTE: Notice. Federal Register, publication. Public information. 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) NOTE: Reports. Deadline. The Commission shall transmit to the President a report on its investigation and determination under this subparagraph not later than 60 days before the action under subsection (a) is to terminate, unless the President specifies a different date. (C) Period of import relief.--Any import relief provided under this section, including any extensions thereof, may not, in the aggregate, be in effect for more than 5 years. (e) Rate After Termination of Import Relief.--When import relief under this section is terminated with respect to an article, the rate of duty on that article shall be the rate that would have been in effect, but for the provision of such relief, on the date on which the relief terminates. (f) Articles Exempt From Relief.--No import relief may be provided under this section on any article that-- (1) is subject to an assessment of additional duty under section 202(b); or (2) has been subject to import relief under this subtitle after the date on which the Agreement enters into force. SEC. 314. NOTE: 19 USC 3805 note. TERMINATION OF RELIEF AUTHORITY. (a) General Rule.--Subject to subsection (b), no import relief may be provided under this subtitle with respect to a good after the date that is 5 years after the date on which duty-free treatment must be provided by the United States to that good pursuant to Annex IV of the Agreement. (b) Presidential Determination.--Import relief may be provided under this subtitle in the case of a Moroccan article after the date on which such relief would, but for this subsection, terminate under subsection (a), if the President determines that Morocco has consented to such relief. SEC. 315. NOTE: 19 USC 3805 note. COMPENSATION AUTHORITY. For purposes of section 123 of the Trade Act of 1974 (19 U.S.C. 2133), any import relief provided by the President under section 313 shall be treated as action taken under chapter 1 of title II of such Act. SEC. 316. NOTE: 19 USC 3805 note. 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 [[Page 1121]] 118 STAT. 1121 (2) by inserting before the period at the end ``, and title III of the United States-Morocco Free Trade Agreement Implementation Act''. Subtitle B--Textile and Apparel Safeguard Measures SEC. 321. NOTE: President. 19 USC 3805 note. COMMENCEMENT OF ACTION FOR RELIEF. (a) In General.--A request under this subtitle for the purpose of adjusting to the obligations of the United States under the Agreement may be filed with the President by an interested party. Upon the filing of a request, the President shall review the request to determine, from information presented in the request, whether to commence consideration of the request. (b) NOTE: Notice. Federal Register, publication. Publication of Request.--If the President determines that the request under subsection (a) provides the information necessary for the request to be considered, the President shall cause to be published in the Federal Register a notice of commencement of consideration of the request, and notice seeking public comments regarding the request. The notice shall include a summary of the request and the dates by which comments and rebuttals must be received. SEC. 322. NOTE: President. 19 USC 3805 note. DETERMINATION AND PROVISION OF RELIEF. (a) Determination.-- (1) In general.--If a positive determination is made under section 321(b), the President shall determine whether, as a result of the reduction or elimination of a duty under the Agreement, a Moroccan textile or apparel article is being imported into the United States in such increased quantities, in absolute terms or relative to the domestic market for that article, and under such conditions as to cause serious damage, or actual threat thereof, to a domestic industry producing an article that is like, or directly competitive with, the imported article. (2) Serious damage.--In making a determination under paragraph (1), the President-- (A) shall examine the effect of increased imports on the domestic industry, as reflected in changes in such relevant economic factors as output, productivity, utilization of capacity, inventories, market share, exports, wages, employment, domestic prices, profits, and investment, none of which is necessarily decisive; and (B) shall not consider changes in technology or consumer preference as factors supporting a determination of serious damage or actual threat thereof. (b) Provision of Relief.-- (1) In general.--If a determination under subsection (a) is affirmative, the President may provide relief from imports of the article that is the subject of such determination, as described in paragraph (2), to the extent that the President determines necessary to remedy or prevent the serious damage and to facilitate adjustment by the domestic industry to import competition. (2) Nature of relief.--The relief that the President is authorized to provide under this subsection with respect to [[Page 1122]] 118 STAT. 1122 imports of an article is an increase in the rate of duty imposed on the article to a level that does not exceed the lesser of-- (A) the column 1 general rate of duty imposed under the HTS on like articles at the time the import relief is provided; or (B) the column 1 general rate of duty imposed under the HTS on like articles on the day before the date on which the Agreement enters into force. SEC. 323. NOTE: 19 USC 3805 note. PERIOD OF RELIEF. (a) In General.--Subject to subsection (b), the import relief that the President provides under subsection (b) of section 322 may not, in the aggregate, be in effect for more than 3 years. (b) Extension.-- (1) In General.--Subject to paragraph (2), the President may extend the effective period of any import relief provided under this subtitle for a period of not more than 2 years, if the President determines that-- (A) the import relief continues to be necessary to remedy or prevent serious damage and to facilitate adjustment by the domestic industry to import competition; and (B) there is evidence that the industry is making a positive adjustment to import competition. (2) Limitation.--Any relief provided under this subtitle, including any extensions thereof, may not, in the aggregate, be in effect for more than 5 years. SEC. 324. NOTE: 19 USC 3805 note. ARTICLES EXEMPT FROM RELIEF. The President may not provide import relief under this subtitle with respect to any article if-- (1) the article has been subject to import relief under this subtitle after the date on which the Agreement enters into force; or (2) the article is subject to import relief under chapter 1 of title II of the Trade Act of 1974. SEC. 325. NOTE: 19 USC 3805 note. RATE AFTER TERMINATION OF IMPORT RELIEF. When import relief under this subtitle is terminated with respect to an article, the rate of duty on that article shall be the rate that would have been in effect, but for the provision of such relief, on the date on which the relief terminates. SEC. 326. NOTE: 19 USC 3805 note. TERMINATION OF RELIEF AUTHORITY. No import relief may be provided under this subtitle with respect to any article after the date that is 10 years after the date on which duties on the article are eliminated pursuant to the Agreement. SEC. 327. NOTE: 19 USC 3805 note. COMPENSATION AUTHORITY. For purposes of section 123 of the Trade Act of 1974 (19 U.S.C. 2133), any import relief provided by the President under this subtitle shall be treated as action taken under chapter 1 of title II of such Act. SEC. 328. NOTE: 19 USC 3805 note. BUSINESS CONFIDENTIAL INFORMATION. The President may not release information which is submitted in a proceeding under this subtitle and which the President considers to be confidential business information unless the party submitting the confidential business information had notice, at [[Page 1123]] 118 STAT. 1123 the time of submission, that such information would be released, or such party subsequently consents to the release of the information. To the extent a party submits confidential business information to the President in a proceeding under this subtitle, the party also shall submit a nonconfidential version of the information, in which the confidential business information is summarized or, if necessary, deleted. Approved August 17, 2004. LEGISLATIVE HISTORY--H.R. 4842 (S. 2677): --------------------------------------------------------------------------- HOUSE REPORTS: No. 108-627 (Comm. on Ways and Means). CONGRESSIONAL RECORD, Vol. 150 (2004): July 22, considered and passed House and Senate.