[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2485 Placed on Calendar Senate (PCS)]
Calendar No. 367
107th CONGRESS
2d Session
S. 2485
Entitled the ``Andean Trade Promotion and Drug Eradication Act''.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 8, 2002
Mr. McCain (for himself, Mr. Gramm, and Mr. Nickles) introduced the
following bill; which was read the first time
May 9, 2002
Read the second time and placed on the calendar
_______________________________________________________________________
A BILL
Entitled the ``Andean Trade Promotion and Drug Eradication Act''.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Andean Trade Promotion and Drug
Eradication Act''.
SEC. 2. FINDINGS.
Congress makes the following findings:
(1) Since the Andean Trade Preference Act was enacted in
1991, it has had a positive impact on United States trade with
Bolivia, Colombia, Ecuador, and Peru. Two-way trade has
doubled, with the United States serving as the leading source
of imports and leading export market for each of the Andean
beneficiary countries. This has resulted in increased jobs and
expanded export opportunities in both the United States and the
Andean region.
(2) The Andean Trade Preference Act has been a key element
in the United States counternarcotics strategy in the Andean
region, promoting export diversification and broad-based
economic development that provides sustainable economic
alternatives to drug-crop production, strengthening the
legitimate economies of Andean countries and creating viable
alternatives to illicit trade in coca.
(3) Notwithstanding the success of the Andean Trade
Preference Act, the Andean region remains threatened by
political and economic instability and fragility, vulnerable to
the consequences of the drug war and fierce global competition
for its legitimate trade.
(4) The continuing instability in the Andean region poses a
threat to the security interests of the United States and the
world. This problem has been partially addressed through
foreign aid, such as Plan Colombia, enacted by Congress in
2000. However, foreign aid alone is not sufficient. Enhancement
of legitimate trade with the United States provides an
alternative means for reviving and stabilizing the economies in
the Andean region.
(5) The Andean Trade Preference Act constitutes a tangible
commitment by the United States to the promotion of prosperity,
stability, and democracy in the beneficiary countries.
(6) Renewal and enhancement of the Andean Trade Preference
Act will bolster the confidence of domestic private enterprise
and foreign investors in the economic prospects of the region,
ensuring that legitimate private enterprise can be the engine
of economic development and political stability in the region.
(7) Each of the Andean beneficiary countries is committed
to conclude negotiation of a Free Trade Area of the Americas by
the year 2005, as a means of enhancing the economic security of
the region.
(8) Temporarily enhancing trade benefits for Andean
beneficiary countries will promote the growth of free
enterprise and economic opportunity in these countries and
serve the security interests of the United States, the region,
and the world.
SEC. 3. ARTICLES ELIGIBLE FOR PREFERENTIAL TREATMENT.
(a) Eligibility of Certain Articles.--Section 204 of the Andean
Trade Preference Act (19 U.S.C. 3203) is amended--
(1) by striking subsection (c) and redesignating
subsections (d) through (g) as subsections (c) through (f),
respectively; and
(2) by amending subsection (b) to read as follows:
``(b) Exceptions and Special Rules.--
``(1) Certain articles that are not import-sensitive.--The
President may proclaim duty-free treatment under this title for
any article described in subparagraph (A), (B), (C), or (D)
that is the growth, product, or manufacture of an ATPDEA
beneficiary country and that meets the requirements of this
section, if the President determines that such article is not
import-sensitive in the context of imports from ATPDEA
beneficiary countries:
``(A) Footwear not designated at the time of the
effective date of this Act as eligible for the purpose
of the generalized system of preferences under title V
of the Trade Act of 1974.
``(B) Petroleum, or any product derived from
petroleum, provided for in headings 2709 and 2710 of
the HTS.
``(C) Watches and watch parts (including cases,
bracelets and straps), of whatever type including, but
not limited to, mechanical, quartz digital or quartz
analog, if such watches or watch parts contain any
material which is the product of any country with
respect to which HTS column 2 rates of duty apply.
``(D) Handbags, luggage, flat goods, work gloves,
and leather wearing apparel that were not designated on
August 5, 1983, as eligible articles for purposes of
the generalized system of preferences under title V of
the Trade Act of 1974.
``(2) Exclusions.--Subject to paragraph (3), duty-free
treatment under this title may not be extended to--
``(A) textiles and apparel articles which were not
eligible articles for purposes of this title on January
1, 1994, as this title was in effect on that date;
``(B) rum and tafia classified in subheading
2208.40 of the HTS; or
``(C) sugars, syrups, and sugar-containing products
subject to over-quota duty rates under applicable
tariff-rate quotas.
``(3) Apparel articles.--
``(A) In general.--Apparel articles that are
imported directly into the customs territory of the
United States from an ATPDEA beneficiary country shall
enter the United States free of duty and free of any
quantitative restrictions, limitations, or consultation
levels, but only if such articles are described in
subparagraph (B).
``(B) Covered articles.--The apparel articles
referred to in subparagraph (A) are the following:
``(i) Apparel articles assembled from
products of the united states and atpdea
beneficiary countries or products not available
in commercial quantities.--Apparel articles
sewn or otherwise assembled in 1 or more ATPDEA
beneficiary countries, or the United States, or
both, exclusively from any one or any
combination of the following:
``(I) Fabrics or fabric components
formed, or components knit-to-shape, in
the United States, from yarns formed in
the United States or 1 or more ATPDEA
beneficiary countries (including
fabrics not formed from yarns, if such
fabrics are classifiable under heading
5602 or 5603 of the HTS and are formed
in the United States).
``(II) Fabrics or fabric components
formed or components knit-to-shape, in
1 or more ATPDEA beneficiary countries,
from yarns formed in 1 or more ATPDEA
beneficiary countries, if such fabrics
(including fabrics not formed from
yarns, if such fabrics are classified
under heading 5602 or 5603 of the HTS
and are formed in 1 or more ATPDEA
beneficiary countries) or components
are in chief weight of llama or alpaca.
``(III) Fabrics or yarn that is not
formed in the United States or in one
or more ATPDEA beneficiary countries,
to the extent that apparel articles of
such fabrics or yarn would be eligible
for preferential treatment, without
regard to the source of the fabrics or
yarn, under Annex 401 of the NAFTA.
``(ii) Additional fabrics.--At the request
of any interested party, the President is
authorized to proclaim additional fabrics and
yarns as eligible for preferential treatment
under clause (i)(III) if--
``(I) the President determines that
such fabrics or yarns cannot be
supplied by the domestic industry in
commercial quantities in a timely
manner;
``(II) the President has obtained
advice regarding the proposed action
from the appropriate advisory committee
established under section 135 of the
Trade Act of 1974 (19 U.S.C. 2155) and
the United States International Trade
Commission;
``(III) within 60 days after the
request, the President has submitted a
report to the Committee on Ways and
Means of the House of Representatives
and the Committee on Finance of the
Senate that sets forth the action
proposed to be proclaimed and the
reasons for such action, and the advice
obtained under subclause (II);
``(IV) a period of 60 calendar
days, beginning with the first day on
which the President has met the
requirements of subclause (III), has
expired; and
``(V) the President has consulted
with such committees regarding the
proposed action during the period
referred to in subclause (III).
``(iii) Apparel articles assembled in 1 or
more atpdea beneficiary countries from regional
fabrics or regional components.--
``(I) Subject to the limitation set
forth in subclause (II), apparel
articles sewn or otherwise assembled in
1 or more ATPDEA beneficiary countries
from fabrics or from fabric components
formed or from components knit-to-
shape, in 1 or more ATPDEA beneficiary
countries, from yarns formed in the
United States or 1 or more ATPDEA
beneficiary countries (including
fabrics not formed from yarns, if such
fabrics are classifiable under heading
5602 or 5603 of the HTS and are formed
in 1 or more ATPDEA beneficiary
countries), whether or not the apparel
articles are also made from any of the
fabrics, fabric components formed, or
components knit-to-shape described in
clause (i).
``(II) The preferential treatment
referred to in subclause (I) shall be
extended in the 1-year period beginning
December 1, 2001, and in each of the 5
succeeding 1-year periods, to imports
of apparel articles in an amount not to
exceed the applicable percentage of the
aggregate square meter equivalents of
all apparel articles imported into the
United States in the preceding 12-month
period for which data are available.
``(III) For purposes of subclause
(II), the term `applicable percentage'
means 3 percent for the 1-year period
beginning December 1, 2001, increased
in each of the 5 succeeding 1-year
periods by equal increments, so that
for the period beginning December 1,
2005, the applicable percentage does
not exceed 6 percent.
``(iv) Handloomed, handmade, and folklore
articles.--A handloomed, handmade, or folklore
article of an ATPDEA beneficiary country
identified under subparagraph (C) that is
certified as such by the competent authority of
such beneficiary country.
``(v) Special rules.--
``(I) Exception for findings and
trimmings.--An article otherwise
eligible for preferential treatment
under this paragraph shall not be
ineligible for such treatment because
the article contains findings or
trimmings of foreign origin, if such
findings and trimmings do not exceed 25
percent of the cost of the components
of the assembled product. Examples of
findings and trimmings are sewing
thread, hooks and eyes, snaps, buttons,
`bow buds', decorative lace, trim,
elastic strips, zippers, including
zipper tapes and labels, and other
similar products.
``(II) Certain interlining.--
(aa) An article otherwise
eligible for preferential
treatment under this paragraph
shall not be ineligible for
such treatment because the
article contains certain
interlinings of foreign origin,
if the value of such
interlinings (and any findings
and trimmings) does not exceed
25 percent of the cost of the
components of the assembled
article.
``(bb) Interlinings
eligible for the treatment
described in division (aa)
include only a chest type
plate, `hymo' piece, or `sleeve
header', of woven or weft-
inserted warp knit construction
and of coarse animal hair or
man-made filaments.
``(cc) The treatment
described in this subclause
shall terminate if the
President makes a determination
that United States
manufacturers are producing
such interlinings in the United
States in commercial
quantities.
``(II) De minimis rule.--An article
that would otherwise be ineligible for
preferential treatment under this
subparagraph because the article
contains fibers or yarns not wholly
formed in the United States or in one
or more ATPDEA beneficiary countries
shall not be ineligible for such
treatment if the total weight of all
such fibers or yarns is not more than 7
percent of the total weight of the
good.
``(C) Handloomed, handmade, and folklore
articles.--For purposes of subparagraph (B)(iv), the
President shall consult with representatives of the
ATPDEA beneficiary countries concerned for the purpose
of identifying particular textile and apparel goods
that are mutually agreed upon as being handloomed,
handmade, or folklore goods of a kind described in
section 2.3(a), (b), or (c) of the Annex or Appendix
3.1.B.11 of the Annex.
``(D) Penalties for transshipment.--
``(i) Penalties for exporters.--If the
President determines, based on sufficient
evidence, that an exporter has engaged in
transshipment with respect to apparel articles
from an ATPDEA beneficiary country, then the
President shall deny all benefits under this
title to such exporter, and any successor of
such exporter, for a period of 2 years.
``(ii) Penalties for countries.--Whenever
the President finds, based on sufficient
evidence, that transshipment has occurred, the
President shall request that the ATPDEA
beneficiary country or countries through whose
territory the transshipment has occurred take
all necessary and appropriate actions to
prevent such transshipment. If the President
determines that a country is not taking such
actions, the President shall reduce the
quantities of apparel articles that may be
imported into the United States from such
country by the quantity of the transshiped
articles multiplied by 3, to the extent
consistent with the obligations of the United
States under the WTO.
``(iii) Transshipment described.--
Transshipment within the meaning of this
subparagraph has occurred when preferential
treatment under subparagraph (A) has been
claimed for an apparel article on the basis of
material false information concerning the
country of origin, manufacture, processing, or
assembly of the article or any of its
components. For purposes of this clause, false
information is material if disclosure of the
true information would mean or would have meant
that the article is or was ineligible for
preferential treatment under subparagraph (A).
``(E) Bilateral emergency actions.--
``(i) In general.--The President may take
bilateral emergency tariff actions of a kind
described in section 4 of the Annex with
respect to any apparel article imported from an
ATPDEA beneficiary country if the application
of tariff treatment under subparagraph (A) to
such article results in conditions that would
be cause for the taking of such actions under
such section 4 with respect to a like article
described in the same 8-digit subheading of the
HTS that is imported from Mexico.
``(ii) Rules relating to bilateral
emergency action.--For purposes of applying
bilateral emergency action under this
subparagraph--
``(I) the requirements of paragraph
(5) of section 4 of the Annex (relating
to providing compensation) shall not
apply;
``(II) the term `transition period'
in section 4 of the Annex shall mean
the period ending December 31, 2006;
and
``(III) the requirements to consult
specified in section 4 of the Annex
shall be treated as satisfied if the
President requests consultations with
the ATPDEA beneficiary country in
question and the country does not agree
to consult within the time period
specified under section 4.
``(4) Customs procedures.--
``(A) In general.--
``(i) Regulations.--Any importer that
claims preferential treatment under paragraph
(1) or (3) shall comply with customs procedures
similar in all material respects to the
requirements of Article 502(1) of the NAFTA as
implemented pursuant to United States law, in
accordance with regulations promulgated by the
Secretary of the Treasury.
``(ii) Determination.--
``(I) In general.--In order to
qualify for the preferential treatment
under paragraph (1) or (3) and for a
Certificate of Origin to be valid with
respect to any article for which such
treatment is claimed, there shall be in
effect a determination by the President
that each country described in
subclause (II)--
``(aa) has implemented and
follows; or
``(bb) is making
substantial progress toward
implementing and following,
procedures and requirements similar in
all material respects to the relevant
procedures and requirements under
chapter 5 of the NAFTA.
``(II) Country described.--A
country is described in this subclause
if it is an ATPDEA beneficiary
country--
``(aa) from which the
article is exported; or
``(bb) in which materials
used in the production of the
article originate or in which
the article or such materials
undergo production that
contributes to a claim that the
article is eligible for
preferential treatment under
paragraph (1) or (3).
``(B) Certificate of origin.--The Certificate of
Origin that otherwise would be required pursuant to the
provisions of subparagraph (A) shall not be required in
the case of an article imported under paragraph (1) or
(3) if such Certificate of Origin would not be required
under Article 503 of the NAFTA (as implemented pursuant
to United States law), if the article were imported
from Mexico.
``(5) Definitions.--In this subsection--
``(A) Annex.--The term `the Annex' means Annex 300-
B of the NAFTA.
``(B) ATPDEA beneficiary country.--The term `ATPDEA
beneficiary country' means any `beneficiary country',
as defined in section 203(a)(1) of this title, which
the President designates as an ATPDEA beneficiary
country, taking into account the criteria contained in
subsections (c) and (d) of section 203 and other
appropriate criteria, including the following:
``(i) Whether the beneficiary country has
demonstrated a commitment to--
``(I) undertake its obligations
under the WTO, including those
agreements listed in section 101(d) of
the Uruguay Round Agreements Act, on or
ahead of schedule; and
``(II) participate in negotiations
toward the completion of the FTAA or
another free trade agreement.
``(ii) The extent to which the country
provides protection of intellectual property
rights consistent with or greater than the
protection afforded under the Agreement on
Trade-Related Aspects of Intellectual Property
Rights described in section 101(d)(15) of the
Uruguay Round Agreements Act.
Calendar No. 367
107th CONGRESS
2d Session
S. 2485
_______________________________________________________________________
A BILL
Entitled the ``Andean Trade Promotion and Drug Eradication Act''.
_______________________________________________________________________
May 9, 2002
Read the second time and placed on the calendar