[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1325 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 1325
To amend the Internal Revenue Code of 1986 to impose a fee on certain
products imported into the United States based on the pollution
intensity associated with the production of such products, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 8, 2025
Mr. Cassidy (for himself and Mr. Graham) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to impose a fee on certain
products imported into the United States based on the pollution
intensity associated with the production of such products, and for
other purposes.
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 ``Foreign Pollution Fee Act of 2025''.
SEC. 2. SENSE OF CONGRESS; PURPOSE.
(a) Sense of Congress.--It is the sense of Congress that--
(1) the United States has led the world in carbon emissions
reductions over the past 15 years, cutting more emissions than
any other nation;
(2) the United States economy is 55 percent more carbon-
efficient than the global average;
(3) on average, goods produced in China generate more than
3 times the carbon emissions of equivalent American-made goods,
while Russian-made goods produce 5 times the emissions, which
gives foreign polluters an unfair cost advantage over American
manufacturers;
(4) Federal environmental regulations impose an estimated
$400,000,000,000 in annual costs on the economy of the United
States, placing a disproportionate burden on American
businesses and workers;
(5) manufacturers in the United States face staggering
environmental regulatory compliance costs, averaging $17,200
per employee, which are costs that foreign competitors,
particularly in China, do not bear;
(6) American businesses spend a higher percentage of their
revenue on environmental compliance than many of their global
competitors, making it harder to compete internationally;
(7) as a result of these costs, companies in the United
States have lost market share to foreign producers operating
under weak, underenforced, or nonexistent environmental
standards;
(8) China is by far the world's worst air and water
polluter, responsible for 30 percent of global carbon
emissions;
(9) the Chinese Communist Party effectively subsidizes its
exports by refusing to enforce basic environmental protections,
undercutting responsible manufacturers in the United States;
(10) China's state-controlled industries operate as an
extension of the Communist Party, using predatory trade
practices, including environmental exploitation, to eliminate
American competition and expand Beijing's control over global
markets;
(11) United States trade policy has given foreign polluters
a competitive edge at the expense of American workers for
decades, rewarding bad actors while punishing responsible
manufacturers in the United States;
(12) China has been the primary beneficiary of these
policies, with the United States losing approximately 5,000,000
jobs in the last 2 decades, with half of that loss directly
attributable to the growing trade deficit with China; and
(13) recognizing and rewarding manufacturers in the United
States for their environmental leadership would strengthen
domestic industry, create high-paying jobs, and reduce
America's dependence on high-emitting producers like China and
Russia.
(b) Purpose.--The purpose of this Act is to level the playing field
for American workers and manufacturers by ensuring that China and other
foreign adversaries cannot exploit weak environmental standards, lack
of enforcement, and noncompliance to gain an unfair advantage in global
trade.
SEC. 3. RULE OF CONSTRUCTION.
Nothing in this Act, or any amendments made by this Act, shall be
construed to authorize the creation of any carbon tax, fee, pricing, or
other mechanism that imposes additional costs to any covered product
(as defined in section 4695(a) of the Internal Revenue Code of 1986, as
added by this Act) which is produced domestically and sold, used,
further refined, or distributed within United States or exported to
another country for sale or use.
TITLE I--FOREIGN POLLUTION FEE
SEC. 101. FOREIGN POLLUTION FEE.
(a) In General.--Chapter 38 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subchapter:
``Subchapter E--Foreign Pollution Fee
``Sec. 4691. Definitions.
``Sec. 4692. Imposition of foreign pollution fee.
``Sec. 4693. Determination of variable charge.
``Sec. 4694. Calculation of pollution intensity.
``Sec. 4695. Treatment of international partnerships.
``Sec. 4696. Covered products.
``Sec. 4697. Advisory Committee on Global Pollution Challenges.
``Sec. 4698. Establishment process and reassessments.
``SEC. 4691. DEFINITIONS.
``For purposes of this subchapter--
``(1) Administrator.--The term `Administrator' means the
Administrator of the Environmental Protection Agency.
``(2) Advisory committee.--The term `Advisory Committee'
means the Advisory Committee on Global Pollution Challenges, as
established under section 4697.
``(3) Appropriate congressional committees.--The term
`appropriate congressional committees' means the Committee on
Finance of the Senate and the Committee on Ways and Means of
the House of Representatives.
``(4) Baseline pollution intensity.--The term `baseline
pollution intensity' means the pollution intensity associated
with production of a covered product in the United States.
``(5) Carbon dioxide equivalent.--The term `carbon dioxide
equivalent' means, with respect to a greenhouse gas, the
quantity of such gas that has a global warming potential
equivalent, determined over a 100-year period, to 1 metric ton
of carbon dioxide, as determined pursuant to table A-1 of
subpart A of part 98 of title 40, Code of Federal Regulations,
as in effect on January 1, 2025.
``(6) Carbon removal.--The term `carbon removal' means--
``(A) the capture of carbon oxides directly from
ambient air (or, in dissolved form, from seawater), and
``(B) the sequestration of such carbon oxides which
results in the net removal of atmospheric carbon oxides
on a lifecycle basis.
``(7) Country of origin.--The term `country of origin'
means, with respect to a covered product--
``(A)(i) in the case of steel, the country in which
the steel was melted and poured,
``(ii) in the case of aluminum, the country in
which the aluminum was smelted and cast, or
``(iii) in the case of any other covered product,
the country in which a covered product was produced, or
``(B) the last country in which a covered product
was substantially transformed, as determined in a
manner consistent with U.S. Customs and Border
Protection procedures, directly prior to importation
into the United States.
``(8) Covered entity.--The term `covered entity' means the
importer of record of a covered product at the time of the
importation of such product.
``(9) Direct emissions.--The term `direct emissions' means
pollution from the facility where a product is produced,
including pollution from the combustion of fuels and process
emissions from chemical or physical transformations resulting
from the production process.
``(10) Foreign entity of concern.--The term `foreign entity
of concern' has the same meaning given such term in section
40207(a)(5) of the Infrastructure Investment and Jobs Act (42
U.S.C. 18741(a)(5)).
``(11) HTS.--The term `HTS' means the Harmonized Tariff
Schedule of the United States.
``(12) Indirect emissions.--The term `indirect emissions'
means pollution from the production of electricity, heating,
and cooling which are--
``(A) produced outside the facility where a product
is produced, and
``(B) consumed during the production process.
``(13) Input material or precursor.--The term `input
material or precursor' means any material or product (other
than fuel) which is--
``(A) incorporated into a covered product, or
``(B) consumed during the production process of a
covered product.
``(14) International partnership agreement.--The term
`international partnership agreement' means an international
partnership agreement established pursuant to title II of the
Foreign Pollution Fee Act of 2025.
``(15) Nonmarket economy country.--The term `nonmarket
economy country' means any foreign country that the Secretary
of Commerce determines, pursuant to section 771(18) of the
Tariff Act of 1930 (19 U.S.C. 1677(18)), does not operate on
market principles of cost or pricing structures, so that sales
of merchandise in that country do not reflect the fair value of
merchandise.
``(16) Pollution.--The term `pollution' refers to emissions
of--
``(A) carbon dioxide,
``(B) hydrofluorocarbons,
``(C) methane,
``(D) nitrous oxide,
``(E) perfluorocarbons,
``(F) sulfur hexafluoride, and
``(G) any other anthropogenically-emitted gas which
has been identified by the Secretary (in accordance
with the notice and comment procedures under section
553 of title 5, United States Code) for purposes of
this subchapter.
``(17) Pollution intensity.--The term `pollution intensity'
means the amount of pollution, expressed in metric tons of
carbon dioxide equivalent, which is emitted into the atmosphere
in the production of a metric ton of a covered product, as
determined pursuant to the requirements described in section
4694(c)).
``(18) Pollution intensity difference.--The term `pollution
intensity difference' means, with respect to any covered
product, the difference (expressed as a percentage) between--
``(A) the pollution intensity associated with
production of such product in the country of origin,
and
``(B) the baseline pollution intensity with respect
to such product.
``(19) Precursor emissions.--The term `precursor emissions'
means pollution (including any direct or indirect emissions)
emitted into the atmosphere in the production of an input
material or precursor.
``(20) Producer.--The term `producer' means the entity
responsible for the manufacturing of a product.
``(21) Product.--The term `product' means any article,
regardless of whether such article is--
``(A) exported from the country of origin, or
``(B) produced and sold only within the country of
origin.
``(22) Recycled material.--The term `recycled material'
means a material that is used in place of, or to reduce the use
of, a primary, raw, or virgin material in the manufacturing of
a product.
``(23) Relevant federal agency.--The term `relevant Federal
agency' means--
``(A) the Department of Energy,
``(B) the Office of the United States Trade
Representative,
``(C) the Department of Commerce,
``(D) the Department of State,
``(E) the Environmental Protection Agency,
``(F) the Council on Environmental Quality,
``(G) the Office of Science and Technology Policy,
and
``(H) the Department of Homeland Security.
``(24) Transportation emissions.--The term `transportation
emissions' means pollution from the transport of a covered
product, or an input material or precursor, across
international borders prior to entry into the United States.
``SEC. 4692. IMPOSITION OF FOREIGN POLLUTION FEE.
``(a) In General.--
``(1) Imposition of fee.--In the case of any covered
product which is imported by a covered entity into the United
States after the applicable date, there is hereby imposed an ad
valorem fee upon entry or importation of such covered product
in an amount equal to the product of--
``(A) the customs value of such covered product
which is imported into the United States, and
``(B) the variable charge (as determined under
section 4693).
``(2) Applicable date.--For purposes of paragraph (1), the
applicable date shall be the date which is 6 weeks after the
date of enactment of this subchapter.
``(b) Fee Due.--
``(1) In general.--The fee imposed under this section with
respect to any covered product shall be paid by the covered
entity which imported such product at the same time, and
through the same electronic portal, that any payment of custom
duties are made.
``(2) Security for fees.--The Secretary may issue such
regulations or other guidance to require, or may direct
officers of U.S. Customs and Border Protection to require, a
covered entity to file with the Secretary a bond or other
security in such amount and with such conditions as the
Secretary determines necessary to ensure payment of the fees
imposed under this section.
``SEC. 4693. DETERMINATION OF VARIABLE CHARGE.
``(a) In General.--
``(1) Initial application.--For purposes of the period
beginning on the day after the applicable date under section
4692(a)(2) and ending on the date on which the final rules
under section 4698(b) are issued, the variable charge with
respect to any covered product shall be determined under the
following table (as determined pursuant to the applicable
country of origin and applicable category under section 4696
with respect to such covered product):
----------------------------------------------------------------------------------------------------------------
Paragraph Paragraph Paragraph
(4) or Paragraph Paragraph (3), (6), (7) or Paragraph Paragraph
``Country of Origin (5) of (1) of (2) of or (8) of (9) of (10) of (11) of
section section section section section section section
4696 4696 4696 4696 4696 4696 4696
----------------------------------------------------------------------------------------------------------------
Canada............................. 26% 27% 17% 27% 33% 30% 31%
China.............................. 200% 143% 200% 103% 121% 200% 200%
Mexico............................. 38% 27% 45% 0% 0% 100% 39%
South Korea........................ 47% 49% 44% 58% 0% 100% 35%
Germany............................ 9% 30% 0% 0% 0% 35% 0%
Taiwan............................. 100% 100% 100% 51% 53% 100% 69%
India.............................. 100% 100% 100% 100% 38% 100% 46%
Vietnam............................ 200% 200% 200% 200% 200% 200% 200%
Brazil............................. 55% 56% 49% 57% 29% 57% 30%
Japan.............................. 29% 29% 29% 34% 0% 37% 0%
Italy.............................. 0% 0% 0% 0% 0% 77% 0%
Thailand........................... 65% 38% 72% 26% 23% 100% 28%
Turkey............................. 50% 45% 57% 100% 32% 100% 41%
France............................. 0% 6% 0% 0% 0% 19% 0%
Spain.............................. 0% 0% 22% 35% 0% 61% 9%
United Kingdom..................... 0% 28% 0% 0% 0% 37% 0%
Netherlands........................ 26% 27% 0% 0% 11% 34% 7%
Russia............................. 200% 200% 200% 200% 200% 0% 0%
Austria............................ 26% 29% 0% 0% 0% 39% 0%
Colombia........................... 32% 32% 32% 0% 0% 100% 0%
Israel............................. 0% 0% 0% 0% 0% 37% 0%
Hungary............................ 33% 28% 33% 31% 0% 100% 39%
Malaysia........................... 71% 40% 100% 33% 100% 100% 100%
Poland............................. 39% 44% 39% 45% 51% 67% 52%
Cambodia........................... 66% 0% 66% 68% 0% 0% 0%
Any other country.................. 50% 40% 55% 48% 69% 100% 37%
----------------------------------------------------------------------------------------------------------------
``(2) Subsequent application.--
``(A) In general.--For purposes of the 36-month
period subsequent to the date on which the final rules
under section 4698(b) are issued, the variable charge
with respect to any covered product shall be determined
as follows:
``(i) With respect to any covered product
which has been assigned to tier 1, the variable
charge shall be an amount (expressed as a
percentage) equal to or greater than 5 percent
and not greater than 25 percent, as determined
in such manner as to achieve a linear
correlation between the variable charge and the
pollution intensity difference of products
assigned to such tier.
``(ii) With respect to any covered product
which has been assigned to tier 2, the variable
charge shall be an amount (expressed as a
percentage) equal to or greater than 25 percent
and not greater than 80 percent, as determined
in such manner as to achieve a linear
correlation between the variable charge and the
pollution intensity difference of products
assigned to such tier.
``(iii) With respect to any covered product
which has been assigned to tier 3, the variable
charge shall be an amount (expressed as a
percentage not to exceed 100 percent) equal to
the sum of--
``(I) 80 percent, plus
``(II) 1 percentage point for every
percentage point by which the pollution
intensity difference of such product
exceeds 200 percent.
``(B) Tiers.--
``(i) Tier 1.--Any covered product for
which the pollution intensity difference is
greater than 10 percent and not greater than 20
percent shall be assigned to tier 1.
``(ii) Tier 2.--Any covered product for
which the pollution intensity difference is
greater than 20 percent and not greater than
200 percent shall be assigned to tier 2.
``(iii) Tier 3.--Any covered product for
which the pollution intensity difference is
greater than 200 percent shall be assigned to
tier 3.
``(C) Enhancement of variable charge.--
``(i) Nonmarket economy country.--In the
case of any covered product for which the
country of origin is a nonmarket economy
country, the variable charge with respect to
such product shall be an amount (expressed as a
percentage) equal to the product of--
``(I) the amount otherwise
determined under subparagraph (A) with
respect to such product, multiplied by
``(II) 2.
``(ii) Foreign entity of concern.--In the
case of any covered product which is produced
in a facility which is owned or controlled by a
foreign entity of concern, the variable charge
with respect to such product shall be an amount
(expressed as a percentage) equal to the
product of--
``(I) the amount otherwise
determined under subparagraph (A) with
respect to such product, multiplied by
``(II) 2.
``(iii) Facility owned by foreign entity of
concern in nonmarket economy country.--In the
case of any covered product which is described
in both clause (i) and clause (ii), the
variable charge with respect to such product
shall be an amount (expressed as a percentage)
equal to the product of--
``(I) the amount otherwise
determined under subparagraph (A) with
respect to such product, multiplied by
``(II) 4.
``(b) Exception for National Security.--
``(1) In general.--The Secretary, in coordination with the
Secretary of Defense and the Commissioner of U.S. Customs and
Border Protection, may reduce the variable charge to zero for
specific entries of a covered product if the Secretary
determines that such specific entries are imported for purposes
of fulfilling a Department of Defense contract.
``(2) Publication.--The Secretary shall make public any
reduction under this subsection with respect to a covered
product unless the publication of such information would
negatively affect national security.
``(c) Evasion.--
``(1) In general.--If the Secretary of Commerce (in
consultation with the Secretary, the Secretary of Homeland
Security, the United States Trade Representative, and the
appropriate congressional committees) determines that any
country, producer, or importer is evading or attempting to
evade application of the fee imposed under section 4692, the
Secretary shall adjust the variable charge in such manner as is
deemed necessary to offset or deter such evasion.
``(2) Trade remedy law enforcement division.--The Trade
Remedy Law Enforcement Division of the Office of Trade of the
Department of Homeland Security shall assist the Secretary with
enforcement and compliance activities concerning any evasion
described in paragraph (1).
``(3) Definition.--
``(A) In general.--The terms `evade' and `evasion'
shall be deemed to refer to entering any covered
product into the customs territory of the United
States--
``(i) by means of any document or
electronically transmitted data or information,
written or oral statement, or act that is
material and false, or any omission that is
material, and
``(ii) which results in any bond or other
security or any amount of the fee imposed under
section 4692 with respect to such product being
reduced or not being applied.
``(B) Fraud relating to carbon removal
activities.--The terms `evade' and `evasion' shall
include any fraud relating carbon removal activities
associated with the production of a covered product (as
described in section 4694(d)(3)).
``(4) Rules.--Not later than 12 months after the date of
enactment of this subchapter, the Secretary (in consultation
with the Secretary of Homeland Security) shall issue a final
rule with respect to the implementation of this subsection.
``SEC. 4694. CALCULATION OF POLLUTION INTENSITY.
``(a) In General.--For purposes of determining the variable charge
for covered products under section 4693 after the period described in
section 4693(a)(1), the Secretary (in consultation with the Advisory
Committee) shall--
``(1) develop consistent methods for calculating the
pollution intensity of any covered product which are applied
consistently across covered products and to the country of
origin, and
``(2) make such methods publicly available.
``(b) Form.--
``(1) In general.--With respect to any covered product, the
pollution intensity of such product shall be expressed based on
the production-weight averaged pollution intensity associated
with the manufacturing of such product in the country of
origin.
``(2) Relevant emissions.--The pollution intensity of a
covered product shall account for--
``(A) direct emissions,
``(B) indirect emissions,
``(C) precursor emissions, and
``(D) transportation emissions,
associated with the manufacturing of such product.
``(3) Specificity.--To the maximum extent practicable, the
pollution intensity of a covered product shall be specific to
the applicable 6-digit HTS subheading number.
``(4) Exceptions.--
``(A) 4-digit.--In the case of a covered product
for which data is not available to determine pollution
intensity in a manner specific to the 6-digit HTS
subheading number, the Secretary may determine the
pollution intensity based on the applicable 4-digit HTS
heading.
``(B) 10-digit.--In the case of a covered product
for which data demonstrates significant differences in
pollution intensity between 10-digit HTS statistical
reporting numbers, the Secretary may determine
pollution intensity based on the applicable 10-digit
statistical reporting number.
``(c) Data.--
``(1) In general.--To the extent necessary for any
determination with respect to any covered product, the
Secretary (in consultation with the Advisory Committee) may
use--
``(A) economic, statistical, and engineering models
and analysis,
``(B) pollution monitoring data from facilities,
satellites, and other pollution monitoring tools,
provided that such data--
``(i) is publicly available, or
``(ii) is not publicly available but is
able to be accessed and verified on a
consistent basis by the Secretary or the head
of any relevant Federal agency,
``(C) voluntarily reported data, provided that such
data is--
``(i) a product of monitored emissions, and
``(ii) able to be verified by the
Secretary,
``(D) the best available information on technology
performance levels for the industrial sector that
produces such product, and
``(E) manufacturing and pollution data which is
specific to a covered product, including relevant data
regarding--
``(i) the industrial sector which is
associated with such product, and
``(ii) the country of origin.
``(2) Access to information.--
``(A) In general.--The head of every relevant
Federal agency shall provide the Secretary with any
information held by or otherwise available to the head
of such Federal agency which is relevant to the
calculation of pollution intensity.
``(B) Confidentiality.--With respect to any
information or data relating to operational practices
or manufacturing processes of any producer of a covered
product which is provided to the Secretary pursuant to
subparagraph (A), unless such information or data is
otherwise publicly available, the head of any relevant
Federal agency shall take such measures as are
necessary to ensure that such information and data is
aggregated and anonymized.
``(d) Methodology.--
``(1) In general.--For purposes of creating a process for
calculating the pollution intensity of any covered product
under subsection (a), the Secretary (in consultation with the
Advisory Committee) shall--
``(A) use the best, and most internationally
comparable, data available to establish the baseline
pollution intensity with respect to such product, and
``(B) in the case of a covered product produced
outside of the United States, base the calculation of
the pollution intensity of such product on the process
used to establish the baseline pollution intensity for
such product.
``(2) Treatment of recycled materials.--In the case of any
recycled material which is recycled (as defined in section
246.101(x) of title 40, Code of Federal Regulations) into--
``(A) an input material or precursor, or
``(B) a covered product,
the Secretary shall deem such recycled material to have a
pollution intensity as low as zero, as determined pursuant to
such methods as are determined appropriate by the Secretary.
``(3) Treatment of carbon oxides.--
``(A) In general.--Any carbon oxide captured from
manufacturing processes by the producer of a covered
product, or verifiably purchased by the producer of a
covered product as an offset from a verified entity
operating carbon removal infrastructure or projects,
shall have the effect of reducing the pollution
associated with the production of a covered product
if--
``(i) in the case of any carbon oxide
captured by the producer of the covered
product, such carbon oxide is captured in the
country of origin of such product and either--
``(I) utilized in the creation of a
product in a manner which ensures that
such carbon oxide does not escape into
the atmosphere, or
``(II) verifiably sequestered in a
manner which provides an accurate
accounting of the storage of such
carbon oxide, or
``(ii) in the case of an offset purchased
by the producer of the covered product, such
offset is a durable carbon removal credit
representing carbon oxides removed from the
atmosphere in the United States or in any
country by an entity which is not designated as
a foreign entity of concern, as verified in a
manner which provides an accurate accounting of
the utilization or sequestration of such carbon
oxide, including the permanence of its storage.
``(B) Accounting.--Subject to subparagraph (C), any
carbon oxide utilized or sequestered as described in
subparagraph (A) shall be--
``(i) treated as a reduction in pollution
associated with the production of a covered
product based on the total tons of carbon oxide
utilized or sequestered,
``(ii) eligible to offset relevant
emissions based on the relevant carbon dioxide
equivalent value, and
``(iii) verified pursuant to such process
as is established by the Secretary (in
consultation with the Administrator and the
Secretary of Energy).
``(C) Weighting.--For purposes of subparagraph (B),
with respect to determining the amount of carbon oxide
utilized or sequestered (as described in subparagraph
(A)), such determination shall be conducted in such a
manner as is determined appropriate by the Secretary
(in consultation with the Administrator and the
Secretary of Energy) so as to ensure that any reduction
in the amount of pollution associated with the
production of a covered product is commensurate with
the level of durability and permanency of the captured
carbon oxide which is utilized or sequestered, such
that measures that provide for permanent carbon removal
(such as sequestration of carbon oxides in geologic
storage or other equivalent measures that have been
scientifically determined to provide permanent storage)
will be determined to result in a proportionally higher
reduction in pollution than measures that provide for
non-permanent carbon removal (such as measures that
have been scientifically determined to have a lower
period of storage or higher risks of reversal compared
to geologic storage).
``(4) Treatment of facility-specific agreements.--For the
purpose of determining the pollution intensity of any covered
product which is produced in a foreign country, if--
``(A) such product is produced in a facility which
is--
``(i) located in such country, and
``(ii) covered by an agreement established
under section 204 of the Foreign Pollution Fee
Act of 2025, and
``(B) the pollution intensity of the product
produced in such facility would otherwise lower the
average pollution intensity associated with the
production of such product in such country,
the pollution intensity of the product produced in such
facility shall not be included for purposes of calculating the
pollution intensity associated with production of such product
in the country of origin.
``(e) Alterations for Foreign Data.--For purposes of determining
the pollution intensity values with respect to any country of origin
for a covered product, if--
``(1) the baseline pollution intensity for such covered
product was determined utilizing a methodology based on data
described in subsection (c) which was provided at a more
localized level, or in more granular detail, than the data
available with respect to the country of origin, the pollution
intensity otherwise determined under this section with respect
to production of such covered product in such country of origin
shall be increased by 20 percent, and
``(2) data with respect to the country of origin is
unavailable or unverifiable, the Secretary may determine the
baseline pollution intensity for the country using an inference
that is adverse to the interests of the country in selecting
from among the facts otherwise available to make the
determination.
``(f) Foreign Illustration of Pollution Intensity.--
``(1) In general.--Any country may provide the Secretary
with access to any verifiable data necessary to establish an
alternative pollution intensity with respect to any covered
product.
``(2) Alternative pollution intensity.--
``(A) In general.--In the case of a country which
provides data described in paragraph (1), the Secretary
may adjust the pollution intensity with respect to any
covered product, provided that the country providing
such data--
``(i) ensures the accuracy of all relevant
data for all covered products,
``(ii) provides data at a level of
granularity which satisfies the methods
established by the Secretary, and
``(iii) provides the data consistently and
in a manner that is verifiable by the
Secretary.
``(B) Role of the advisory committee.--For purposes
of this paragraph, the Advisory Committee shall assist
the Secretary by verifying relevant data and
calculating adjustments to pollution intensities.
``(3) Publication of alternative pollution intensity
values.--In the case of any pollution intensity with respect to
any covered product which is adjusted pursuant to paragraph
(2)--
``(A) the Secretary shall publish such adjustment
in the Federal Register, and
``(B) such adjustment shall take effect in the
following calendar year.
``(g) Treatment of Potential Evasion and Outliers.--If the
Secretary of Commerce (in consultation with the Secretary, the United
States Trade Representative, the appropriate congressional committees,
and any relevant Federal agency) determines that any country or any
producer is evading or attempting to evade application of the fee
imposed under section 4692, the Secretary may prohibit the importation
of covered goods from that country or produced by that producer.
``SEC. 4695. TREATMENT OF INTERNATIONAL PARTNERSHIPS.
``(a) Adjustment of Fee for Partner Countries.--In the case of a
covered product which is produced in a country which is a party to an
international partnership agreement which satisfies the conditions
under sections 201 and 202 of the Foreign Pollution Fee Act of 2025
(referred to in this section as a `partner country'), the fee under
section 4692 shall be reduced in accordance with the terms of such
agreement.
``(b) Elimination of Treatment of Foreign Data.--Section 4694(e)
shall not apply to any partner country.
``SEC. 4696. COVERED PRODUCTS.
``The term `covered product' means articles classifiable under the
same 6-digit subheading number of the HTS within one of the following
categories:
``(1) Aluminum classifiable under heading 7601 or any of
headings 7603 through 7608 of the HTS, aluminum hydroxide
classifiable under subheading 2818.30.00 of the HTS, and
aluminum oxide classifiable under subheading 2818.20.00 of the
HTS.
``(2) Articles of aluminum classifiable under any of
headings 7609 through 7616 of the HTS, and any other articles
of aluminum that are classified under any other heading or
subheading of the HTS (as identified by the Secretary).
``(3) Articles of cement classifiable under headings 6810
or 6811 of the HTS.
``(4) Iron and steel classifiable under any of headings
7206 through 7306 of the HTS.
``(5) Articles of iron and steel classifiable under any of
headings 7307 through 7326 of the HTS.
``(6) Cement classifiable under heading 2523 or subheading
3824.50 of the HTS.
``(7) Fertilizer and related products classifiable under
any of the following headings or subheading of the HTS:
``(A) Heading 2808.
``(B) Heading 2814.
``(C) Subheading 2834.21.
``(D) Heading 3102 (other than subheading
3102.10.30).
``(E) Any of subheadings 3105.20 through 3105.59.
``(F) Subheading 3105.90.10.
``(8) Glass classifiable under any of headings 7001 through
7020 of the HTS.
``(9) Hydrogen classifiable under subheading 2804.10 of the
HTS.
``(10) Solar products classifiable under any of subheadings
2804.61, 3818.00, 8541.42, 8541.43, 8541.49, and 8541.59 of the
HTS.
``(11) Battery inputs classifiable under statistical
reporting number 2826.90.9010 or subheading 8507.60.00 or
8507.90 of the HTS.
``SEC. 4697. ADVISORY COMMITTEE ON GLOBAL POLLUTION CHALLENGES.
``(a) In General.--The Secretary shall establish an advisory
committee, to be known as the `Advisory Committee on Global Pollution
Challenges', in accordance with chapter 10 of title 5, United States
Code (commonly referred to as the `Federal Advisory Committee Act') .
``(b) Composition.--
``(1) In general.--The Advisory Committee shall be composed
of--
``(A) 2 representatives of each of the industrial
sectors described in paragraphs (1) through (9) of
section 4696,
``(B) 2 representatives from the National
Laboratories (as defined in section 2 of the Energy
Policy Act of 2005 (42 U.S.C. 15801)), and
``(C) 2 representatives from the scientific
research community with expertise in greenhouse gas
accounting and the monitoring, reporting, and
verification of carbon reduction and carbon removal
processes,
as appointed by the Secretary.
``(2) Period of appointment.--Each representative appointed
pursuant to paragraph (1) shall serve for a term of 2 calendar
years, and may be reappointed by the Secretary for any
additional term.
``(c) Chair.--The chair of the Advisory Committee shall be selected
by the Secretary from the representatives described in subsection (b).
``(d) Duties.--The Advisory Committee shall--
``(1) in accordance with section 4694, consult with the
Secretary on methods of calculating--
``(A) the baseline pollution intensity, as
determined based on production of the covered product
in the United States, and
``(B) the respective pollution intensity for
production of such covered product in any foreign
country,
``(2) provide assistance with regard to section 4694(f), as
well as any other requests from the Secretary, and
``(3) provide recommendations to the Secretary regarding
any rules or reassessments under section 4698.
``SEC. 4698. ESTABLISHMENT PROCESS AND REASSESSMENTS.
``(a) In General.--The processes established under this section
shall be utilized to--
``(1) provide rules for application of the fee imposed
under section 4692 after the period described in section
4693(a)(1), and
``(2) perform any required reassessment.
``(b) Rulemaking.--
``(1) Classification of covered products.--Not later than
12 months after the date of enactment of this subchapter, the
Secretary shall issue a final rule for purposes of determining
the appropriate heading or subheading number of the HTS for
each covered product.
``(2) Pollution intensity methodology calculations.--
``(A) In general.--Not later than 12 months after
the date of enactment of this subchapter, the Secretary
shall publish a final rule establishing--
``(i) in a manner consistent with section
4694, the methods for calculating the pollution
intensity with respect to each covered product
and country of origin, and
``(ii) methods for any foreign country to
establish an alternative pollution intensity
with respect to any covered product pursuant to
subsection (f) of such section.
``(B) Evasion.--Not later than 18 months after the
date of enactment of this subchapter, the Secretary
shall publish a final rule to address producers
described in section 4694(g).
``(3) Establishment of variable charges.--Not later than 12
months after the date of enactment of this subchapter, the
Secretary (in consultation with the United States Trade
Representative) shall issue a final rule establishing the
variable charge for covered products for purposes of section
4693.
``(4) Traceability.--
``(A) In general.--Not later than 12 months after
the date of enactment of this subchapter, the Secretary
(in consultation with the Secretary of Homeland
Security) shall issue a final rule with respect to
establishing traceability requirements applicable to
any covered entity for purposes of demonstrating the
accuracy of data provided with respect to each entry or
importation of a covered product which is relevant to
determining the variable charge imposed on such
product.
``(B) Requirements.--
``(i) In general.--For purposes of
subparagraph (A), the traceability requirements
shall include--
``(I) entry-, importation- and
supply chain-specific traceability and
document authentication with respect to
all entities involved in production of
the covered product at every step of
the supply chain, and
``(II) successful verifications
(for entries or importations) and
validations (for supply chains).
``(ii) Frequency.--For purposes of clause
(i), such verifications, validations, and
audits shall be conducted at a frequency (as
determined by the Secretary in the final rule
described in subparagraph (A)) that is tailored
to jurisdiction-, producer-, industry-, and
product-specific risk factors in order to
provide a high level of confidence to the
Secretary that covered entities are satisfying
the requirements established under the final
rule.
``(C) Demonstration.--At the time of each entry or
importation of a covered product, the covered entity
shall affirmatively demonstrate to the Secretary that
the requirements established under subparagraph (A)
have been satisfied with respect to such product.
``(D) Data.--The Secretary shall use the data
provided by covered entities to U.S. Customs and Border
Protection pursuant to the requirements established
under subparagraph (A) for purposes making
determinations under section 4694(g) with respect to
whether any country or any producer is evading or
attempting to evade application of the fee imposed
under section 4692.
``(5) Additional rulemaking.--In addition to the rules
described in paragraphs (1) through (4), any rules which are
necessary in order to properly apply the fee under section 4692
shall be issued not later than the date which is 12 months
after the date of enactment of this subchapter.
``(c) Reassessment.--
``(1) In general.--Not later than 3 years after the date of
the issuance of any final rule described in subsection (b), and
every 3 years thereafter, the Secretary shall reassess and, as
necessary, issue a final rule to adjust, the existing final
rule.
``(2) Revision.--The United States International Trade
Commission, in consultation with the Secretary, shall annually
publish a notice reflecting headings, subheadings, and
statistical reporting numbers of the HTS contained in any rule
issued under this section which need to be amended due to
revisions to the HTS.
``(3) Newly available data.--With respect to any
reassessment described in paragraph (1), the Secretary may
utilize any data which is available as a result of enhancements
in the ability to assess domestic or foreign pollution pursuant
to legislation enacted or developments in technology subsequent
to the issuance of the most recent final rule.
``(4) International partnerships.--In the case of an
international partnership agreement, the Secretary may, at the
time of the establishment of such agreement and in a manner
consistent with such agreement, issue a final rule to adjust
the pollution intensity for any covered product (as determined
pursuant to subsection (d)) produced in a country which is a
party to such agreement.
``(5) Timing.--In the case of any final rule issued with
respect to any reassessment under paragraph (1), the
application of such rule shall take effect on January 1 of the
first calendar year beginning subsequent to the issuance of
such final rule.
``(d) Process.--
``(1) Notice and consultation.--Not later than 6 months
prior to--
``(A) the date on which any final rule is required
to be issued under paragraphs (1) through (5) of
subsection (b), and
``(B) the date on which any reassessment is
required to be made under subsection (c)(1),
the Secretary shall publish a notice of proposed rulemaking
with respect to such final rule or reassessment and brief the
appropriate congressional committees and consult with such
committees regarding such final rule or reassessment.
``(2) Comment.--Following the notice under paragraph (1),
the Secretary shall provide a public comment period of not less
than 60 days.
``(3) Consultation.--Prior to the issuance of any final
rule or reassessment under this section regarding the
appropriate classification of covered products, the Secretary
may consult with--
``(A) the United States Trade Representative,
``(B) the United States International Trade
Commission,
``(C) the Commissioner of U.S. Customs and Border
Protection, and
``(D) all other relevant Federal agencies.
``(e) Publication of Foreign Pollution Fee Table.--
``(1) In general.--The Secretary shall publish, in a
comprehensive format that is made publicly available, all final
rules issued under this section with respect to the application
of the fee imposed under section 4692 (referred to in this
subsection as the `Foreign Pollution Fee Table').
``(2) Included information.--The Foreign Pollution Fee
Table shall include information related to--
``(A) any products covered by the fee imposed under
section 4692, as identified by the applicable 6-digit
HTS subheading number,
``(B) the variable charge with respect to any
covered product by country of origin, and
``(C) the baseline pollution intensity and
pollution intensity with respect to each covered
product and country of origin.
``(3) Updates.--The Foreign Pollution Fee Table shall be
updated every 12 months.
``(4) Exception.--The Secretary shall redact any
information which may have a negative effect on national
security.''.
TITLE II--INTERNATIONAL PARTNERSHIP AGREEMENTS RELATING TO POLLUTION
FEES
SEC. 201. INTERNATIONAL PARTNERSHIP AGREEMENTS.
(a) In General.--The United States Trade Representative, at the
direction of the President, may--
(1) engage in negotiations with countries to encourage the
establishment and expansion of international partnership
agreements, as provided in this title;
(2) establish agreements with foreign countries with
respect to proposals to enter into international partnership
agreements;
(3) implement such an agreement; and
(4) perform the oversight and enforcement role necessary to
uphold any such agreement.
(b) Requirements for International Partnership Agreements.--
(1) Products.--An international partnership agreement may
be entered into under this title on the basis of one or more
covered products.
(2) Parties.--
(A) In general.--Subject to the requirements under
subparagraph (B) and paragraph (3), the United States
may enter into an international partnership agreement
under this title with--
(i) one country; or
(ii) multiple countries.
(B) Exclusion of nonmarket economy countries.--The
United States may not enter into an international
partnership agreement under this title with a nonmarket
economy country.
(3) Requirements.--An international partnership agreement
entered into under this title is required to provide for--
(A) creation of interoperable methods to promote
pollution reduction through trade mechanisms by
assessing pollution intensity differences between
countries;
(B) maintenance of the ability of a country that is
a party to the agreement to determine methods of
pollution reduction within that country;
(C) reduction of any fee or charge between
countries that are parties to the agreement in a manner
compatible with the process described in section 202;
(D) compatible pollution monitoring, reporting, and
verification methods that--
(i) allow for interoperable methods to be
used to calculate the pollution intensity of
covered products and countries that are parties
to the agreement, on the basis of the available
information within each such country;
(ii) allow for similar methods to be used
to calculate the pollution intensity of covered
products imported from countries that are not
parties to the agreement; and
(iii) allow for each country that is a
party to the agreement to consistently validate
the monitoring and reporting information of the
other countries that are parties to the
agreement with respect to products covered by
the agreement; and
(E) collaboration between the parties to the
agreement on developing and implementing policies--
(i) to address market distortions,
including excess capacity, caused by the
policies or practices of nonmarket economy
countries; and
(ii) to determine whether covered products
are produced in facilities owned or controlled
by a foreign entity of concern.
(c) Timeline.--
(1) In general.--The requirements described in subsection
(b) with respect to an international partnership agreement are
required to be achieved--
(A) for high-income countries and upper-middle
income countries, not later than 3 years after entering
into the agreement; and
(B) for low-income countries and lower-middle-
income countries, not later than 5 years after entering
into the agreement.
(2) Applicability of benefits.--
(A) In general.--Except as provided by subsection
(f), countries described in paragraph (1)(A) shall not
receive the treatment described in section 4695 of the
Internal Revenue Code of 1986, as added by title I,
until the requirements under subsection (b) are met.
(B) Termination.--The United States shall maintain
the right to terminate an international partnership
agreement at any time pursuant to the terms of the
agreement.
(d) Publication; Congressional Review.--An international
partnership agreement entered into under this section shall be--
(1) published in the Federal Register; and
(2) treated as a final rule prepared by an agency,
including with respect to review by Congress under chapter 8 of
title 5, United States Code (commonly referred to as the
``Congressional Review Act'').
(e) Restrictions on Negotiations Relating to Domestic Policy.--The
authority provided by this section does not include the authority to
negotiate or enter into an agreement that would establish carbon taxes,
fees, pricing, or other mechanisms that impose additional costs on
products produced by a United States entity.
(f) Delay in Application of Foreign Pollution Fee To Negotiate With
Free Trade Agreement Countries.--In the case of a country with which
the United States has a free trade agreement in effect that is
negotiating for a partnership agreement under this title, the
application of the fee under section 4696 of the Internal Revenue Code
of 1986, as added by title I, may be delayed for not more than 12
months to provide time to complete the negotiations.
SEC. 202. APPLICATION OF FOREIGN POLLUTION FEE IN PARTNERSHIPS.
(a) In General.--In accordance with section 4695 of the Internal
Revenue Code of 1986, as added by title I, a reduced fee shall be
applied under section 4692 of such Code with respect to a covered
product imported from a country that is a party to an international
partnership agreement entered into under this title.
(b) Failure To Meet Requirements.--If a covered product is produced
in a country that is a party to an international partnership agreement
entered into under this title but does not meet the requirement
described in subsection (a), the fee applied under section 4692 of the
Internal Revenue Code of 1986, as added by title I, with respect to the
covered product shall be calculated based on the variable charge
determined under section 4693(a) of the Internal Revenue Code of 1986,
as added by title I.
(c) Treatment of Low-Income and Lower-Middle Income Countries.--
(1) In general.--During the 5-year period following the
entry into force of an international partnership agreement
under this title between the United States and a low-income
country or lower-middle-income country--
(A) the pollution intensity requirement described
in subsection (a) shall be considered to be met with
respect to covered products produced in the country;
and
(B) no fee shall be applied to covered products
imported from that country.
(2) Modifications to requirements.--
(A) In general.--During the 10-year period
beginning after the completion of the 5-year period
described in paragraph (1), the pollution intensity
requirement described in subsection (a) shall be
considered to be met with respect to a covered product
produced in a country described in paragraph (1) if new
capacity in that country for the production of the
covered product developed during the 10-year period
described in paragraph (1) is not more than 50 percent
more pollution intense than the baseline pollution
intensity at the time of the entry into force of the
international partnership agreement.
(B) Future development.--For the 10-year period
beginning after the completion of the 10-year period
described in subparagraph (A), and each 10-year period
thereafter, the pollution intensity requirement
described in subsection (a) shall be considered to be
met with respect to a covered product produced in a
country described in paragraph (1) if new capacity in
that country for the production of the covered product
developed during the preceding 10-year period is not
more than 25 percent more pollution intense than the
baseline pollution intensity at the beginning of such
preceding 10-year period.
(3) Application of fee.--If the requirements described in
paragraph (1) or (2), as applicable, are not met with respect
to a covered product, the fee specified in subsection (b) shall
apply.
(d) Treatment of Evasion of Fee.--Nothing in this section shall
supersede section 4694(g) of the Internal Revenue Code of 1986, as
added by title I, with respect to potential evasion of the fee assessed
under section 4692 of such Code if--
(1) a determination is made under such section 4694(g) with
respect to a producer; and
(2) the producer is owned, operated, or financed in or by a
country that is not a party to an international partnership
agreement entered into under this title.
SEC. 203. SUPPORT FOR PARTICIPATION OF LOW-INCOME AND LOWER-MIDDLE-
INCOME COUNTRIES IN INTERNATIONAL PARTNERSHIP AGREEMENTS.
(a) In General.--The United States Trade Representative, at the
direction of the President and in consultation with the heads of the
relevant Federal agencies, may include, in an international partnership
agreement entered into under this title with a country described in
subsection (b), provisions providing for--
(1) the provision of treatment described in section 202(c)
to that country;
(2) the extension of untied or tied aid through a United
States export, development, or trade agency to support energy
technology deployment and manufacturing and secure supply chain
development, including financing and technical assistance
provided by the United States Agency for International
Development, the Department of State, the Millennium Challenge
Corporation, and the United States International Development
Finance Corporation;
(3) lower initial requirements relating to pollution data
monitoring and alternative methods to more accurately project
and model pollution under the agreement;
(4) support for expansion of monitoring and reporting of
pollution using best practices; and
(5) technical assistance to ensure full compliance with the
terms of the agreement.
(b) Countries Described.--A country described in this subsection
is--
(1) a low-income country or a lower-middle-income country;
and
(2) a country that the United States Trade Representative
determines--
(A) meets investment thresholds in environmental
infrastructure commensurate with the revenue foregone
as a result of not charging the fee under section 4692
of the Internal Revenue Code of 1986, as added by title
I, with respect to covered products imported from the
country;
(B) meets procurement thresholds of covered
products and related goods and services produced in the
United States and other countries that are parties to
international partnership agreements under this title;
(C) provides preferential market access for energy
and environmental, security, and healthcare goods and
services produced in the United States; and
(D) adopts certain labor and environmental
standards.
(c) Benchmarks and Requirements.--
(1) In general.--The United States Trade Representative
shall establish benchmarks or requirements to assess the
progress of a country described in subsection (b) in fully
implementing the terms of an international partnership
agreement entered into under this title.
(2) Benchmarks.--The benchmarks and requirements
established under paragraph (1) with respect to a country shall
include--
(A) improving methods of monitoring, reporting, and
verifying pollution levels;
(B) if, after the entry into force of the
international partnership agreement, new manufacturing
or production capacity for a covered product is built
in the country but that capacity is owned or operated,
or the majority of the financing for that capacity is
provided, by an entity associated with a country that
is not a party to an international partnership
agreement, treating the new capacity--
(i) at the pollution intensity of the
country that is not a party to an international
partnership agreement if the pollution
intensity for the covered product produced in
that country is greater than the pollution
intensity of the covered product produced in
the country that is a party to the
international partnership agreement;
(ii) as not eligible for the treatment of a
country that is a party to an international
partnership agreement described in section 202;
and
(iii) in accordance to the requirements of
section 4695 of the Internal Revenue Code of
1986, as added by title I; and
(C) if, after the entry into force of the
international partnership agreement, the ownership, a
stake of ownership, or operation of manufacturing or
production capacity for a covered product that is in
operation on the date of entry into force is
transferred to an entity in a country that is not a
party to an international partnership agreement,
treating such capacity--
(i) at the pollution intensity of the
country that is not a party to an international
partnership agreement if the pollution
intensity for the covered product produced in
that country is greater than the pollution
intensity of the covered product produced in
the country that is a party to the
international partnership agreement;
(ii) as not eligible for the treatment of a
country that is a party to an international
partnership agreement described in section 202;
and
(iii) in accordance to the requirements of
section 4695 of the Internal Revenue Code of
1986, as added by title I.
(d) Termination.--The United States shall maintain the authority to
terminate the application to a country with which the United States
enters into an international partnership agreement under this title of
the provisions described in subsection (a)--
(1) if the country does not meet the benchmarks and
requirements under subsection (c); and
(2) pursuant to the terms of the international partnership
agreement.
(e) Inclusion of Other International Partners.--To the maximum
extent practicable, the United States shall seek to include additional
high-income countries and upper-middle-income countries in
international partnership agreements entered into under this title with
low-income countries or lower-middle-income countries.
SEC. 204. TREATMENT OF CERTAIN FACILITIES RELATING TO POLLUTION FEES.
(a) In General.--The Commissioner of U.S. Customs and Border
Protection and the Administrator of the Environmental Protection Agency
shall jointly develop a process under a facility located in a foreign
country may apply to have products produced at the facility be treated
at a pollution intensity specific to the facility (in this section
referred to as ``facility-specific treatment'') instead of the
pollution intensity for the country.
(b) Eligibility Requirements.--To be eligible for facility-specific
treatment under subsection (a), a facility is required to--
(1) be placed in service after the date of the enactment of
this Act;
(2) be--
(A) owned or operated by a United States entity; or
(B) located in a country--
(i) with which the United States has
entered into an international partnership
agreement under this title; or
(ii) with which the United States has a
free trade agreement in effect;
(3) comply with procedures to allow for ongoing
verification of direct emissions by United States officials or
their designees, including requirements that the facility--
(A) deploy pollution monitoring equipment able to
report in real time the levels of pollution emitted by
the facility;
(B) provide access to real-time pollution
monitoring data;
(C) in the absence of pollution monitoring
equipment, disclose--
(i) the volume and type of fuels consumed
within the facility for the production of each
covered product;
(ii) emissions associated with any fuel
combustion within the facility for the
production of each covered product, including
for industrial processes and any electricity,
heat, or steam production; and
(iii) all emissions associated with the
chemical and physical transformation of raw
materials within the facility for the
production of each covered product; and
(D) allow for spot inspections to ensure compliance
with the requirements of this subsection;
(4) account for the indirect emissions from the production
of electricity, heating, and cooling that is produced outside
the facility and consumed in the production of a covered
product;
(5) account for the emissions associated with the
manufacture of input materials or precursors that are consumed
in the production of a covered product;
(6) disclose the volume and value of all covered products
produced in the facility;
(7) for facilities that manufacture a mix of covered
products and products that are not covered products, disclose
the fraction of production of covered products as a share of
total output volume and value; and
(8) identify the covered entity with respect to covered
products produced at the facility for which the covered entity
is not the owner of the facility.
(c) Reconsideration of Determinations of Pollution Intensity.--The
Commissioner of U.S. Customs and Border Protection and the
Administrator of the Environmental Protection Agency may establish a
process under which a United States entity a subsidiary of which owns
or operates a facility granted facility-specific treatment under
subsection (a) may petition for reconsideration of the determination of
the pollution intensity specific to the facility.
(d) Application of Variable Charge.--A product produced by a
facility granted facility-specific treatment under subsection (a) and
imported into the United States shall be subject to the variable charge
determined under section 4693(a) of the Internal Revenue Code of 1986,
as added by title I, aligned with the pollution intensity difference of
a product produced by the facility and the baseline pollution
intensity.
(e) Ineligibility of Facilities in or Owned by Nonmarket Economy
Countries.--A facility is not eligible for facility-specific treatment
under subsection (a) if--
(1) the facility--
(A) is located in a nonmarket economy country; and
(B)(i) is owned, partially owned, or operated by
the government of the country or an entity owned or
controlled by that government; or
(ii) has received financing, including in the form
of a tax credit or a limit on tax liability, to operate
the facility by the government of the country or an
entity owned or controlled by that government; or
(2) the facility is owned, partially owned, or operated
by--
(A) an entity owned or controlled by the government
of a nonmarket economy country, without regard to
whether the facilitated is located in such a country;
or
(B) a foreign entity of concern.
(f) Termination of Facility-Specific Treatment.--The eligibility of
a facility for facility-specific treatment under subsection (a) may be
terminated at the sole discretion of the United States if the facility
fails to satisfy any of the requirements under subsection (b) or
becomes ineligible under subsection (e).
(g) Confidentiality of Information.--Any information or data
provided to the Commissioner of U.S. Customs and Border Protection or
the Administrator of the Environmental Protection Agency pursuant to
subsection (b) relating to operational practices or manufacturing
processes of a facility seeking facility-specific treatment under
subsection (a), may not be publicly disclosed, unless such information
or data is otherwise publicly available.
SEC. 205. DEFINITIONS.
(a) In General.--In this title:
(1) Free trade agreement.--The term ``free trade
agreement'' means an agreement with 1 or more countries that--
(A) reduces or eliminates tariffs and non-tariff
barriers between the countries that are parties to the
agreement; and
(B) is approved by Congress.
(2) Nonmarket economy country.--The term ``nonmarket
economy country'' means any foreign country that the Secretary
of Commerce determines, pursuant to section 771(18) of the
Tariff Act of 1930 (19 U.S.C. 1677(18)), does not operate on
market principles of cost or pricing structures, so that sales
of merchandise in that country do not reflect the fair value of
merchandise.
(3) United states entity.--The term ``United States
entity'' means an entity organized under the laws of the United
States or any jurisdiction within the United States.
(b) Other Terms.--In this title, the definitions set forth in
section 4691 of the Internal Revenue Code of 1986, as added by title I,
apply.
(c) World Bank Classifications.--In this title:
(1) In general.--Subject to paragraph (2), the terms
``high-income country'', ``upper-middle-income country'',
``lower-middle-income country'', and ``low-income country''
shall be defined based on the classification of the economy of
a country by the World Bank.
(2) High-income and upper-middle-income countries.--In the
case of any country which, as of January 1, 2025, is classified
by the World Bank as a high-income country or an upper-middle-
income country, such country shall not be eligible to be
reclassified as a lower-middle-income country or a low-income
country.
TITLE III--OTHER MATTERS
SEC. 301. ANNUAL REPORT.
(a) In General.--Not later than one year after the date of the
enactment of this Act, and annually thereafter, the Secretary of the
Treasury shall submit to Congress a report--
(1) describing the efforts of the Department of the
Treasury--
(A) to help United States entities that manufacture
covered products counter unfair competition from
nonmarket economy countries; and
(B) to increase jobs in the United States;
(2) assessing the competitive advantage of the United
States with respect to greenhouse gas intensity; and
(3) assessing the impact of this Act and the amendments
made by this Act on the United States trade deficit and
economic activity.
(b) Biennial Reviews.--In each report required by subsection (a)
submitted during an odd-numbered year, the Secretary shall include an
assessment of whether this Act and the amendments made by this Act are
achieving their intended policy goals.
(c) Covered Product Defined.--In this section, the term ``covered
product'' has the meaning given that term in section 4696 of the
Internal Revenue Code of 1986, as added by title I.
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