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104th Congress Rept. 104-524
HOUSE OF REPRESENTATIVES
2d Session Part 1
_______________________________________________________________________
SHIPBUILDING TRADE AGREEMENT ACT
_______________________________________________________________________
March 18, 1996.--Ordered to be printed
_______
Mr. Archer, from the Committee on Ways and Means, submitted the
following
R E P O R T
[To accompany H.R. 2754]
[Including cost estimate of the Congressional Budget Office]
The Committee on Ways and Means, to whom was referred the
bill (H.R. 2754) to approve and implement the OECD Shipbuilding
Trade Agreement, having considered the same, report favorably
thereon with an amendment and recommend that the bill as
amended do pass.
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Shipbuilding Trade Agreement Act''.
SEC. 2. APPROVAL OF THE SHIPBUILDING AGREEMENT.
The Congress approves The Agreement Respecting Normal Competitive
Conditions in the Commercial Shipbuilding and Repair Industry
(hereafter in this Act referred to as the ``Shipbuilding Agreement''),
a reciprocal trade agreement which resulted from negotiations under the
auspices of the Organization for Economic Cooperation and Development,
and was entered into on December 21, 1994.
SEC. 3. EFFECTIVE DATE.
This Act and the amendments made by this Act take effect on the date
that the Shipbuilding Agreement enters into force with respect to the
United States.
TITLE I--INJURIOUS PRICING AND COUNTERMEASURES
SEC. 101. INJURIOUS PRICING AND COUNTERMEASURES PROCEEDINGS.
The Tariff Act of 1930 is amended by adding at the end the following
new title:
``TITLE VIII--INJURIOUS PRICING AND COUNTERMEASURES RELATING TO
SHIPBUILDING
``Subtitle A--Injurious Pricing Charge and Countermeasures
``Sec. 801. Injurious pricing charge.
``Sec. 802. Procedures for initiating an injurious pricing
investigation.
``Sec. 803. Preliminary determinations.
``Sec. 804. Termination or suspension of investigation.
``Sec. 805. Final determinations.
``Sec. 806. Imposition and collection of injurious pricing
charge.
``Sec. 807. Imposition of countermeasures.
``Sec. 808. Injurious pricing petitions by third countries.
``Subtitle B--Special Rules
``Sec. 821. Export price.
``Sec. 822. Normal value.
``Sec. 823. Currency conversion.
``Subtitle C--Procedures
``Sec. 841. Hearings.
``Sec. 842. Determinations on the basis of the facts available.
``Sec. 843. Access to information.
``Sec. 844. Conduct of investigations.
``Sec. 845. Administrative action following shipbuilding
agreement panel reports.
``Subtitle D--Definitions
``Sec. 861. Definitions.
``Subtitle A--Injurious Pricing Charge and Countermeasures
``SEC. 801. INJURIOUS PRICING CHARGE.
``(a) Basis for Charge.--If--
``(1) the administering authority determines that a foreign
vessel has been sold directly or indirectly to one or more
United States buyers at less than its fair value, and
``(2) the Commission determines that--
``(A) an industry in the United States--
``(i) is or has been materially injured, or
``(ii) is threatened with material injury, or
``(B) the establishment of an industry in the United
States is or has been materially retarded,
by reason of the sale of such vessel, then there shall be
imposed upon the foreign producer of the subject vessel an
injurious pricing charge, in an amount equal to the amount by
which the normal value exceeds the export price for the vessel.
For purposes of this subsection and section 805(b)(1), a
reference to the sale of a foreign vessel includes the creation
or transfer of an ownership interest in the vessel, except for
an ownership interest created or acquired solely for the
purpose of providing security for a normal commercial loan.
``(b) Foreign Vessels Not Merchandise.--No foreign vessel may be
considered to be, or to be part of, a class or kind of merchandise for
purposes of subtitle B of title VII.
``SEC. 802. PROCEDURES FOR INITIATING AN INJURIOUS PRICING
INVESTIGATION.
``(a) Initiation by Administering Authority.--
``(1) General rule.--Except in the case in which subsection
(d)(6) applies, an injurious pricing investigation shall be
initiated whenever the administering authority determines, from
information available to it, that a formal investigation is
warranted into the question of whether the elements necessary
for the imposition of a charge under section 801(a) exist, and
whether a producer described in section 861(17)(C) would meet
the criteria of subsection (b)(1)(B) for a petitioner.
``(2) Time for initiation by administering authority.--An
investigation may only be initiated under paragraph (1) within
6 months after the time the administering authority first knew
or should have known of the sale of the vessel. Any period in
which subsection (d)(6)(A) applies shall not be included in
calculating that 6-month period.
``(b) Initiation by Petition.--
``(1) Petition requirements.--(A) Except in a case in which
subsection (d)(6) applies, an injurious pricing proceeding
shall be initiated whenever an interested party, as defined in
subparagraph (C), (D), (E), or (F) of section 861(17), files a
petition with the administering authority, on behalf of an
industry, which alleges the elements necessary for the
imposition of an injurious pricing charge under section 801(a)
and the elements required under subparagraph (B), (C), (D), or
(E) of this paragraph, and which is accompanied by information
reasonably available to the petitioner supporting those
allegations and identifying the transaction concerned.
``(B)(i) If the petitioner is a producer described in section
861(17)(C), and--
``(I) if the vessel was sold through a broad multiple
bid, the petition shall include information indicating
that the petitioner was invited to tender a bid on the
contract at issue, the petitioner actually did so, and
the bid of the petitioner substantially met the
delivery date and technical requirements of the bid,
``(II) if the vessel was sold through any bidding
process other than a broad multiple bid and the
petitioner was invited to tender a bid on the contract
at issue, the petition shall include information
indicating that the petitioner actually did so and the
bid of the petitioner substantially met the delivery
date and technical requirements of the bid, or
``(III) except in a case in which the vessel was sold
through a broad multiple bid, if there is no invitation
to tender a bid, the petition shall include information
indicating that the petitioner was capable of building
the vessel concerned and, if the petitioner knew or
should have known of the proposed purchase, it made
demonstrable efforts to conclude a sale with the United
States buyer consistent with the delivery date and
technical requirements of the buyer.
``(ii) For purposes of clause (i)(III), there is a rebuttable
presumption that the petitioner knew or should have known of
the proposed purchase if it is demonstrated that--
``(I) the majority of the producers in the industry
have made efforts with the United States buyer to
conclude a sale of the subject vessel, or
``(II) general information on the sale was available
from brokers, financiers, classification societies,
charterers, trade associations, or other entities
normally involved in shipbuilding transactions with
whom the petitioner had regular contacts or dealings.
``(C) If the petitioner is an interested party described in
section 861(17)(D), the petition shall include information
indicating that members of the union or group of workers
described in that section are employed by a producer that meets
the requirements of subparagraph (B) of this paragraph.
``(D) If the petitioner is an interested party described in
section 861(17)(E), the petition shall include information
indicating that a member of the association described in that
section is a producer that meets the requirements of
subparagraph (B) of this paragraph.
``(E) If the petitioner is an interested party described in
section 861(17)(F), the petition shall include information
indicating that a member of the association described in that
section meets the requirements of subparagraph (C) or (D) of
this paragraph.
``(F) The petition may be amended at such time, and upon such
conditions, as the administering authority and the Commission
may permit.
``(2) Simultaneous filing with commission.--The petitioner
shall file a copy of the petition with the Commission on the
same day as it is filed with the administering authority.
``(3) Deadline for filing petition.--
``(A) Deadline.--(i) A petitioner to which paragraph
(1)(B) (i) or (ii) applies shall file the petition no
later than the earlier of--
``(I) 6 months after the time that the
petitioner first knew or should have known of
the sale of the subject vessel, or
``(II) 6 months after delivery of the subject
vessel.
``(ii) A petitioner to which paragraph (1)(B)(iii)
applies shall--
``(I) file the petition no later than the
earlier of 9 months after the time that the
petitioner first knew or should have known of
the sale of the subject vessel, or 6 months
after delivery of the subject vessel, and
``(II) submit to the administering authority
a notice of intent to file a petition no later
than 6 months after the time that the
petitioner first knew or should have known of
the sale (unless the petition itself is filed
within that 6-month period).
``(B) Presumption of knowledge.--For purposes of this
paragraph, if the existence of the sale, together with
general information concerning the vessel, is published
in the international trade press, there is a rebuttable
presumption that the petitioner knew or should have
known of the sale of the vessel from the date of that
publication.
``(c) Actions Before Initiating Investigations.--
``(1) Notification of governments.--Before initiating an
investigation under either subsection (a) or (b), the
administering authority shall notify the government of the
exporting country of the investigation. In the case of the
initiation of an investigation under subsection (b), such
notification shall include a public version of the petition.
``(2) Acceptance of communications.--The administering
authority shall not accept any unsolicited oral or written
communication from any person other than an interested party
described in section 861(17)(C), (D), (E), or (F) before the
administering authority makes its decision whether to initiate
an investigation pursuant to a petition, except for inquiries
regarding the status of the administering authority's
consideration of the petition or a request for consultation by
the government of the exporting country.
``(3) Nondisclosure of certain information.--The
administering authority and the Commission shall not disclose
information with regard to any draft petition submitted for
review and comment before it is filed under subsection (b)(1).
``(d) Petition Determination.--
``(1) Time for initial determination.--(A) Within 45 days
after the date on which a petition is filed under subsection
(b), the administering authority shall, after examining, on the
basis of sources readily available to the administering
authority, the accuracy and adequacy of the evidence provided
in the petition, determine whether the petition--
``(i) alleges the elements necessary for the
imposition of an injurious pricing charge under section
801(a) and the elements required under subsection
(b)(1)(B), (C), (D), or (E), and contains information
reasonably available to the petitioner supporting the
allegations; and
``(ii) determine if the petition has been filed by or
on behalf of the industry.
``(B) Any period in which paragraph (6)(A) applies shall not
be included in calculating the 45-day period described in
subparagraph (A).
``(2) Affirmative determinations.--If the determinations
under clauses (i) and (ii) of paragraph (1)(A) are affirmative,
the administering authority shall initiate an investigation to
determine whether the vessel was sold at less than fair value,
unless paragraph (6) applies.
``(3) Negative determinations.--If--
``(A) the determination under clause (i) or (ii) of
paragraph (1)(A) is negative, or
``(B) paragraph (6)(B) applies,
the administering authority shall dismiss the petition,
terminate the proceeding, and notify the petitioner in writing
of the reasons for the determination.
``(4) Determination of industry support.--
``(A) General rule.--For purposes of this subsection,
the administering authority shall determine that the
petition has been filed by or on behalf of the domestic
industry, if--
``(i) the domestic producers or workers who
support the petition collectively account for
at least 25 percent of the total capacity of
domestic producers capable of producing a like
vessel, and
``(ii) the domestic producers or workers who
support the petition collectively account for
more than 50 percent of the total capacity to
produce a like vessel of that portion of the
domestic industry expressing support for or
opposition to the petition.
``(B) Certain positions disregarded.--In determining
industry support under subparagraph (A), the
administering authority shall disregard the position of
domestic producers who oppose the petition, if such
producers are related to the foreign producer or United
States buyer of the subject vessel, or the domestic
producer is itself the United States buyer, unless such
domestic producers demonstrate that their interests as
domestic producers would be adversely affected by the
imposition of an injurious pricing charge.
``(C) Polling the industry.--If the petition does not
establish support of domestic producers or workers
accounting for more than 50 percent of the total
capacity to produce a like vessel--
``(i) the administering authority shall poll
the industry or rely on other information in
order to determine if there is support for the
petition as required by subparagraph (A), or
``(ii) if there is a large number of
producers in the industry, the administering
authority may determine industry support for
the petition by using any statistically valid
sampling method to poll the industry.
``(D) Comments by interested parties.--Before the
administering authority makes a determination with
respect to initiating an investigation, any person who
would qualify as an interested party under section
861(17) if an investigation were initiated, may submit
comments or information on the issue of industry
support. After the administering authority makes a
determination with respect to initiating an
investigation, the determination regarding industry
support shall not be reconsidered.
``(5) Definition of domestic producers or workers.--For
purposes of this subsection, the term `domestic producers or
workers' means interested parties as defined in section 861(17)
(C), (D), (E), or (F).
``(6) Proceedings by wto members.--The administering
authority shall not initiate an investigation under this
section if, with respect to the vessel sale at issue, an
antidumping proceeding conducted by a WTO member who is not a
Shipbuilding Agreement Party--
``(A) has been initiated and has been pending for not
more than one year, or
``(B) has been completed and resulted in the
imposition of antidumping measures or a negative
determination with respect to whether the sale was at
less than fair value or with respect to injury.
``(e) Notification to Commission of Determination.--The administering
authority shall--
``(1) notify the Commission immediately of any determination
it makes under subsection (a) or (d), and
``(2) if the determination is affirmative, make available to
the Commission such information as it may have relating to the
matter under investigation, under such procedures as the
administering authority and the Commission may establish to
prevent disclosure, other than with the consent of the party
providing it or under protective order, of any information to
which confidential treatment has been given by the
administering authority.
``SEC. 803. PRELIMINARY DETERMINATIONS.
``(a) Determination by Commission of Reasonable Indication of
Injury.--
``(1) General rule.--Except in the case of a petition
dismissed by the administering authority under section
802(d)(3), the Commission, within the time specified in
paragraph (2), shall determine, based on the information
available to it at the time of the determination, whether there
is a reasonable indication that--
``(A) an industry in the United States--
``(i) is or has been materially injured, or
``(ii) is threatened with material injury, or
``(B) the establishment of an industry in the United
States is or has been materially retarded,
by reason of the sale of the subject vessel. If the Commission
makes a negative determination under this paragraph, the
investigation shall be terminated.
``(2) Time for commission determination.--The Commission
shall make the determination described in paragraph (1) within
90 days after the date on which the petition is filed or, in
the case of an investigation initiated under section 802(a),
within 90 days after the date on which the Commission receives
notice from the administering authority that the investigation
has been initiated.
``(b) Preliminary Determination by Administering Authority.--
``(1) Period of injurious pricing investigation.--(A) The
administering authority shall make a determination, based upon
the information available to it at the time of the
determination, of whether there is a reasonable basis to
believe or suspect that the subject vessel was sold at less
than fair value.
``(B) If cost data is required to determine normal value on
the basis of a sale of a foreign like vessel that has not been
delivered on or before the date on which the administering
authority initiates the investigation, the administering
authority shall make its determination within 160 days after
the date of delivery of the foreign like vessel.
``(C) If normal value is to be determined on the basis of
constructed value, the administering authority shall make its
determination within 160 days after the date of delivery of the
subject vessel.
``(D) In cases in which subparagraph (B) or (C) does not
apply, the administering authority shall make its determination
within 160 days after the date on which the administering
authority initiates the investigation under section 802.
``(E) In no event shall the administering authority make its
determination before an affirmative determination is made by
the Commission under subsection (a).
``(2) De minimis injurious pricing margin.--In making a
determination under this subsection, the administering
authority shall disregard any injurious pricing margin that is
de minimis. For purposes of the preceding sentence, an
injurious pricing margin is de minimis if the administering
authority determines that the margin is less than 2 percent of
the export price.
``(c) Extension of Period in Extraordinarily Complicated Cases or for
Good Cause.--
``(1) In general.--If--
``(A) the administering authority concludes that the
parties concerned are cooperating and determines that--
``(i) the case is extraordinarily complicated
by reason of--
``(I) the novelty of the issues
presented, or
``(II) the nature and extent of the
information required, and
``(ii) additional time is necessary to make
the preliminary determination, or
``(B) a party to the investigation requests an
extension and demonstrates good cause for the
extension,
then the administering authority may postpone the time for
making its preliminary determination.
``(2) Length of postponement.--The preliminary determination
may be postponed under paragraph (1) (A) or (B) until not later
than the 190th day after--
``(A) the date of delivery of the foreign like
vessel, if subsection (b)(1)(B) applies,
``(B) the date of delivery of the subject vessel, if
subsection (b)(1)(C) applies, or
``(C) the date on which the administering authority
initiates an investigation under section 802, in a case
in which subsection (b)(1)(D) applies.
``(3) Notice of postponement.--The administering authority
shall notify the parties to the investigation, not later than
20 days before the date on which the preliminary determination
would otherwise be required under subsection (b)(1), if it
intends to postpone making the preliminary determination under
paragraph (1). The notification shall include an explanation of
the reasons for the postponement, and notice of the
postponement shall be published in the Federal Register.
``(d) Effect of Determination by the Administering Authority.--If the
preliminary determination of the administering authority under
subsection (b) is affirmative, the administering authority shall--
``(1) determine an estimated injurious pricing margin, and
``(2) make available to the Commission all information upon
which its determination was based and which the Commission
considers relevant to its injury determination, under such
procedures as the administering authority and the Commission
may establish to prevent disclosure, other than with the
consent of the party providing it or under protective order, of
any information to which confidential treatment has been given
by the administering authority.
``(e) Notice of Determination.--Whenever the Commission or the
administering authority makes a determination under this section, the
Commission or the administering authority, as the case may be, shall
notify the petitioner, and other parties to the investigation, and the
Commission or the administering authority (whichever is appropriate) of
its determination. The administering authority shall include with such
notification the facts and conclusions on which its determination is
based. Not later than 5 days after the date on which the determination
is required to be made under subsection (a)(2), the Commission shall
transmit to the administering authority the facts and conclusions on
which its determination is based.
``SEC. 804. TERMINATION OR SUSPENSION OF INVESTIGATION.
``(a) Termination of Investigation Upon Withdrawal of Petition.--
``(1) In general.--Except as provided in paragraph (2), an
investigation under this subtitle may be terminated by either
the administering authority or the Commission, after notice to
all parties to the investigation, upon withdrawal of the
petition by the petitioner.
``(2) Limitation on termination by commission.--The
Commission may not terminate an investigation under paragraph
(1) before a preliminary determination is made by the
administering authority under section 803(b).
``(b) Termination of Investigations Initiated by Administering
Authority.--The administering authority may terminate any investigation
initiated by the administering authority under section 802(a) after
providing notice of such termination to all parties to the
investigation.
``(c) Alternate Equivalent Remedy.--The criteria set forth in
subparagraphs (A) through (D) of section 806(e)(1) shall apply to any
agreement that forms the basis for termination of an investigation
under subsection (a) or (b).
``(d) Proceedings by WTO Members.--
``(1) Suspension of investigation.--The administering
authority and the Commission shall suspend an investigation
under this section if a WTO member that is not a Shipbuilding
Agreement Party initiates an antidumping proceeding described
in section 861(29)(A) with respect to the sale of the subject
vessel.
``(2) Termination of investigation.--If an antidumping
proceeding described in paragraph (1) is concluded by--
``(A) the imposition of antidumping measures, or
``(B) a negative determination with respect to
whether the sale is at less than fair value or with
respect to injury,
the administering authority and the Commission shall terminate
the investigation under this section.
``(3) Continuation of investigation.--(A) If such a
proceeding--
``(i) is concluded by a result other than a result
described in paragraph (2), or
``(ii) is not concluded within one year from the date
of the initiation of the proceeding,
then the administering authority and the Commission shall
terminate the suspension and continue the investigation. The
period in which the investigation was suspended shall not be
included in calculating deadlines applicable with respect to
the investigation.
``(B) Notwithstanding subparagraph (A)(ii), if the proceeding
is concluded by a result described in paragraph (2)(A), the
administering authority and the Commission shall terminate the
investigation under this section.
``SEC. 805. FINAL DETERMINATIONS.
``(a) Determinations by Administering Authority.--
``(1) In general.--Within 75 days after the date of its
preliminary determination under section 803(b), the
administering authority shall make a final determination of
whether the vessel which is the subject of the investigation
has been sold in the United States at less than its fair value.
``(2) Extension of period for determination.--(A) The
administering authority may postpone making the final
determination under paragraph (1) until not later than 290 days
after--
``(i) the date of delivery of the foreign like
vessel, in an investigation to which section
803(b)(1)(B) applies,
``(ii) the date of delivery of the subject vessel, in
an investigation to which section 803(b)(1)(C) applies,
or
``(iii) the date on which the administering authority
initiates the investigation under section 802, in an
investigation to which section 803(b)(1)(D) applies.
``(B) The administering authority may apply subparagraph (A)
if a request in writing is made by--
``(i) the producer of the subject vessel, in a
proceeding in which the preliminary determination by
the administering authority under section 803(b) was
affirmative, or
``(ii) the petitioner, in a proceeding in which the
preliminary determination by the administering
authority under section 803(b) was negative.
``(3) De minimis injurious pricing margin.--In making a
determination under this subsection, the administering
authority shall disregard any injurious pricing margin that is
de minimis as defined in section 803(b)(2).
``(b) Final Determination by Commission.--
``(1) In general.--The Commission shall make a final
determination of whether--
``(A) an industry in the United States--
``(i) is or has been materially injured, or
``(ii) is threatened with material injury, or
``(B) the establishment of an industry in the United
States is or has been materially retarded,
by reason of the sale of the vessel with respect to which the
administering authority has made an affirmative determination
under subsection (a)(1).
``(2) Period for injury determination following affirmative
preliminary determination by administering authority.--If the
preliminary determination by the administering authority under
section 803(b) is affirmative, then the Commission shall make
the determination required by paragraph (1) before the later
of--
``(A) the 120th day after the day on which the
administering authority makes its affirmative
preliminary determination under section 803(b), or
``(B) the 45th day after the day on which the
administering authority makes its affirmative final
determination under subsection (a).
``(3) Period for injury determination following negative
preliminary determination by administering authority.--If the
preliminary determination by the administering authority under
section 803(b) is negative, and its final determination under
subsection (a) is affirmative, then the final determination by
the Commission under this subsection shall be made within 75
days after the date of that affirmative final determination.
``(c) Effect of Final Determinations.--
``(1) Effect of affirmative determination by the
administering authority.--If the determination of the
administering authority under subsection (a) is affirmative,
then the administering authority shall--
``(A) make available to the Commission all
information upon which such determination was based and
which the Commission considers relevant to its
determination, under such procedures as the
administering authority and the Commission may
establish to prevent disclosure, other than with the
consent of the party providing it or under protective
order, of any information to which confidential
treatment has been given by the administering
authority, and
``(B) calculate an injurious pricing charge in an
amount equal to the amount by which the normal value
exceeds the export price of the subject vessel.
``(2) Issuance of order; effect of negative determination.--
If the determinations of the administering authority and the
Commission under subsections (a)(1) and (b)(1) are affirmative,
then the administering authority shall issue an injurious
pricing order under section 806. If either of such
determinations is negative, the investigation shall be
terminated upon the publication of notice of that negative
determination.
``(d) Publication of Notice of Determinations.--Whenever the
administering authority or the Commission makes a determination under
this section, it shall notify the petitioner, other parties to the
investigation, and the other agency of its determination and of the
facts and conclusions of law upon which the determination is based, and
it shall publish notice of its determination in the Federal Register.
``(e) Correction of Ministerial Errors.--The administering authority
shall establish procedures for the correction of ministerial errors in
final determinations within a reasonable time after the determinations
are issued under this section. Such procedures shall ensure opportunity
for interested parties to present their views regarding any such
errors. As used in this subsection, the term `ministerial error'
includes errors in addition, subtraction, or other arithmetic function,
clerical errors resulting from inaccurate copying, duplication, or the
like, and any other type of unintentional error which the administering
authority considers ministerial.
``SEC. 806. IMPOSITION AND COLLECTION OF INJURIOUS PRICING CHARGE.
``(a) In General.--Within 10 days after being notified by the
Commission of an affirmative determination under section 805(b), the
administering authority shall publish an order imposing an injurious
pricing charge on the foreign producer of the subject vessel which--
``(1) directs the foreign producer of the subject vessel to
pay to the Secretary of the Treasury, or the designee of the
Secretary, within 180 days from the date of publication of the
order, an injurious pricing charge in an amount equal to the
amount by which the normal value exceeds the export price of
the subject vessel,
``(2) includes the identity and location of the foreign
producer and a description of the subject vessel, in such
detail as the administering authority deems necessary, and
``(3) informs the foreign producer that--
``(A) failure to pay the injurious pricing charge in
a timely fashion may result in the imposition of
countermeasures with respect to that producer under
section 807,
``(B) payment made after the deadline described in
paragraph (1) shall be subject to interest charges at
the Commercial Interest Reference Rate (CIRR), and
``(C) the foreign producer may request an extension
of the due date for payment under subsection (b).
``(b) Extension of Due Date for Payment in Extraordinary
Circumstances.--
``(1) Extension.--Upon request, the administering authority
may amend the order under subsection (a) to set a due date for
payment or payments later than the date that is 180 days from
the date of publication of the order, if the administering
authority determines that full payment in 180 days would render
the producer insolvent or would be incompatible with a
judicially supervised reorganization. When an extended payment
schedule provides for a series of partial payments, the
administering authority shall specify the circumstances under
which default on one or more payments will result in the
imposition of countermeasures.
``(2) Interest charges.--If a request is granted under
paragraph (1), payments made after the date that is 180 days
from the publication of the order shall be subject to interest
charges at the CIRR.
``(c) Notification of Order.--The administering authority shall
deliver a copy of the order requesting payment to the foreign producer
of the subject vessel and to an appropriate representative of the
government of the exporting country.
``(d) Revocation of Order.--The administering authority--
``(1) may revoke an injurious pricing order if the
administering authority determines that producers accounting
for substantially all of the capacity to produce a domestic
like vessel have expressed a lack of interest in the order, and
``(2) shall revoke an injurious pricing order--
``(A) if the sale of the vessel that was the subject
of the injurious pricing determination is voided,
``(B) if the injurious pricing charge is paid in
full, including any interest accrued for late payment,
``(C) upon full implementation of an alternative
equivalent remedy described in subsection (e), or
``(D) if, with respect to the vessel sale that was at
issue in the investigation that resulted in the
injurious pricing order, an antidumping proceeding
conducted by a WTO member who is not a Shipbuilding
Agreement Party has been completed and resulted in the
imposition of antidumping measures.
``(e) Alternative Equivalent Remedy.--
``(1) Agreement for alternate remedy.--The administering
authority may suspend an injurious pricing order if the
administering authority enters into an agreement with the
foreign producer subject to the order on an alternative
equivalent remedy, that the administering authority
determines--
``(A) is at least as effective a remedy as the
injurious pricing charge,
``(B) is in the public interest,
``(C) can be effectively monitored and enforced, and
``(D) is otherwise consistent with the domestic law
and international obligations of the United States.
``(2) Prior consultations and submission of comments.--Before
entering into an agreement under paragraph (1), the
administering authority shall consult with the industry, and
provide for the submission of comments by interested parties,
with respect to the agreement.
``(3) Material violations of agreement.--If the injurious
pricing order has been suspended under paragraph (1), and the
administering authority determines that the foreign producer
concerned has materially violated the terms of the agreement
under paragraph (1), the administering authority shall
terminate the suspension.
``SEC. 807. IMPOSITION OF COUNTERMEASURES.
``(a) General Rule.--
``(1) Issuance of order imposing countermeasures.--Unless an
injurious pricing order is revoked or suspended under section
806 (d) or (e), the administering authority shall issue an
order imposing countermeasures.
``(2) Contents of order.--The countermeasure order shall--
``(A) state that, as provided in section 468, a
permit to lade or unlade passengers or merchandise may
not be issued with respect to vessels contracted to be
built by the foreign producer of the vessel with
respect to which an injurious pricing order was issued
under section 806, and
``(B) specify the scope and duration of the
prohibition on the issuance of a permit to lade or
unlade passengers or merchandise.
``(b) Notice of Intent To Impose Countermeasures.--
``(1) General rule.--The administering authority shall issue
a notice of intent to impose countermeasures not later than 30
days before the expiration of the time for payment specified in
the injurious pricing order (or extended payment provided for
under section 806(b)), and shall publish the notice in the
Federal Register within 7 days after issuing the notice.
``(2) Elements of the notice of intent.--The notice of intent
shall contain at least the following elements:
``(A) Scope.--A permit to lade or unlade passengers
or merchandise may not be issued with respect to any
vessel--
``(i) built by the foreign producer subject
to the proposed countermeasures, and
``(ii) with respect to which the material
terms of sale are established within a period
of 4 consecutive years beginning on the date
that is 30 days after publication in the Fedeal
Register of the notice of intent described in
paragraph (1).
``(B) Duration.--For each vessel described in
subparagraph (A), a permit to lade or unlade passengers
or merchandise may not be issued for a period of 4
years after the date of delivery of the vessel.
``(c) Determination To Impose Countermeasures; Order.--
``(1) General rule.--The administering authority shall,
within the time specified in paragraph (2), issue a
determination and order imposing countermeasures.
``(2) Time for determination.--The determination shall be
issued within 90 days after the date on which the notice of
intent to impose countermeasures under subsection (b) is
published in the Federal Register. The administering authority
shall publish the determination, and the order described in
paragraph (4), in the Federal Register within 7 days after
issuing the final determination, and shall provide a copy of
the determination and order to the Customs Service.
``(3) Content of the determination.--In the determination
imposing countermeasures, the administering authority shall
determine whether, in light of all of the circumstances, an
interested party has demonstrated that the scope or duration of
the countermeasures described in subsection (b)(2) should be
narrower or shorter than the scope or duration set forth in the
notice of intent to impose countermeasures.
``(4) Order.--At the same time it issues its determination,
the administering authority shall issue an order imposing
countermeasures, consistent with its determination.
``(d) Administrative Review of Determination To Impose
Countermeasures.--
``(1) Request for review.--Each year, in the anniversary
month of the issuance of the order imposing countermeasures
under subsection (c), the administering authority shall publish
in the Federal Register a notice providing that interested
parties may request--
``(A) a review of the scope or duration of the
countermeasures determined under subsection (c)(3), and
``(B) a hearing in connection with such a review.
``(2) Review.--If a proper request has been received under
paragraph (1), the administering authority shall--
``(A) publish notice of initiation of a review in the
Federal Register not later than 15 days after the end
of the anniversary month of the issuance of the order
imposing countermeasures, and
``(B) review and determine whether the requesting
party has demonstrated that the scope or duration of
the countermeasures is excessive in light of all of the
circumstances.
``(3) Time for review.--The administering authority shall
make its determination under paragraph (2)(B) within 90 days
after the date on which the notice of initiation of the review
is published. If the determination under paragraph (2)(B) is
affirmative, the administering authority shall amend the order
accordingly. The administering authority shall promptly publish
the determination and any amendment to the order in the Federal
Register, and shall provide a copy of any amended order to the
Customs Service. In extraordinary circumstances, the
administering authority may extend the time for its
determination under paragraph (2)(B) to not later than 150 days
after the date on which the notice of initiation of the review
is published.
``(e) Extension of Countermeasures.--
``(1) Request for extension.--Within the time described in
paragraph (2), an interested party may file with the
administering authority a request that the scope or duration of
countermeasures be extended.
``(2) Deadline for request for extension.--
``(A) Request for extension beyond 4 years.--If the
request seeks an extension that would cause the scope
or duration of countermeasures to exceed 4 years,
including any prior extensions, the request for
extension under paragraph (1) shall be filed not
earlier than the date that is 15 months, and not later
than the date that is 12 months, before the date that
marks the end of the period that specifies the vessels
that fall within the scope of the order by virtue of
the establishment of material terms of sale within that
period.
``(B) Other requests.--If the request seeks an
extension under paragraph (1) other than one described
in subparagraph (A), the request shall be filed not
earlier than the date that is 6 months, and not later
than a date that is 3 months, before the date that
marks the end of the period referred to in subparagraph
(A).
``(3) Determination.--
``(A) Notice of request for extension.--If a proper
request has been received under paragraph (1), the
administering authority shall publish notice of
initiation of an extension proceeding in the Federal
Register not later than 15 days after the applicable
deadline in paragraph (2) for requesting the extension.
``(B) Procedures.--
``(i) Requests for extension beyond 4
years.--If paragraph (2)(A) applies to the
request, the administering authority shall
consult with the Trade Representative under
paragraph (4).
``(ii) Other requests.--If paragraph (2)(B)
applies to the request, the administering
authority shall determine, within 90 days after
the date on which the notice of initiation of
the proceeding is published, whether the
requesting party has demonstrated that the
scope or duration of the countermeasures is
inadequate in light of all of the
circumstances. If the administering authority
determines that an extension is warranted, it
shall amend the countermeasure order
accordingly. The administering authority shall
promptly publish the determination and any
amendment to the order in the Federal Register,
and shall provide a copy of any amended order
to the Customs Service.
``(4) Consultation with trade representative.--If paragraph
(3)(B)(i) applies, the administering authority shall consult
with the Trade Representative concerning whether it would be
appropriate to request establishment of a dispute settlement
panel under the Shipbuilding Agreement for the purpose of
seeking authorization to extend the scope or duration of
countermeasures for a period in excess of 4 years.
``(5) Decision not to request panel.--If, based on
consultations under paragraph (4), the Trade Representative
decides not to request establishment of a panel, the Trade
Representative shall inform the party requesting the extension
of the countermeasures of the reasons for its decision in
writing. The decision shall not be subject to judicial review.
``(6) Panel proceedings.--If, based on consultations under
paragraph (4), the Trade Representative requests the
establishment of a panel under the Shipbuilding Agreement to
authorize an extension of the period of countermeasures, and
the panel authorizes such an extension, the administering
authority shall promptly amend the countermeasure order. The
administering authority shall publish notice of the amendment
in the Federal Register.
``(f) List of Vessels Subject to Countermeasures.--
``(1) General rule.--At least once during each 12-month
period beginning on the anniversary date of a determination to
impose countermeasures under this section, the administering
authority shall publish in the Federal Register a list of all
delivered vessels subject to countermeasures under the
determination.
``(2) Content of list.--The list under paragraph (1) shall
include the following information for each vessel, to the
extent the information is available:
``(A) The name and general description of the vessel.
``(B) The vessel identification number.
``(C) The shipyard where the vessel was constructed.
``(D) The last-known registry of the vessel.
``(E) The name and address of the last-known owner of
the vessel.
``(F) The delivery date of the vessel.
``(G) The remaining duration of countermeasures on
the vessel.
``(H) Any other identifying information available.
``(3) Amendment of list.---The administering authority may
amend the list from time to time to reflect new information
that comes to its attention and shall publish any amendments in
the Federal Register.
``(4) Service of list and amendments.--(A) The administering
authority shall serve a copy of the list described in paragraph
(1) on--
``(i) the petitioner under section 802(b),
``(ii) the United States Customs Service,
``(iii) the Secretariat of the Organization for
Economic Cooperation and Development,
``(iv) the owners of vessels on the list,
``(v) the shipyards on the list, and
``(vi) the government of the country in which a
shipyard on the list is located.
``(B) The administering authority shall serve a copy of any
amendments to the list under paragraph (3) or subsection (g)(3)
on--
``(i) the parties listed in clauses (i), (ii), and
(iii) of subparagraph (A), and,
``(ii) if the amendment affects their interests, the
parties listed in clauses (iv), (v), and (vi) of
subparagraph (A).
``(g) Administrative Review of List of Vessels Subject to
Countermeasures.--
``(1) Request for review.--(A) An interested party may
request in writing a review of the list described in subsection
(f)(1), including any amendments thereto, to determine
whether--
``(i) a vessel included in the list does not fall
within the scope of the applicable countermeasure order
and should be deleted, or
``(ii) a vessel not included in the list falls within
the scope of the applicable countermeasure order and
should be added.
``(B) Any request seeking a determination described in
subparagraph (A)(i) shall be made within 90 days after the date
of publication of the applicable list.
``(2) Review.--If a proper request for review has been
received, the administering authority shall--
``(A) publish notice of initiation of a review in the
Federal Register--
``(i) not later than 15 days after the
request is received, or
``(ii) if the request seeks a determination
described in paragraph (1)(A)(i), not later
than 15 days after the deadline described in
paragraph (1)(B), and
``(B) review and determine whether the requesting
party has demonstrated that--
``(i) a vessel included in the list does not
qualify for such inclusion, or
``(ii) a vessel not included in the list
qualifies for inclusion.
``(3) Time for determination.--The administering authority
shall make its determination under paragraph (2)(B) within 90
days after the date on which the notice of initiation of such
review is published. If the administering authority determines
that a vessel should be added or deleted from the list, the
administering authority shall amend the list accordingly. The
administering authority shall promptly publish in the Federal
Register the determination and any such amendment to the list.
``(h) Expiration of Countermeasures.--Upon expiration of a
countermeasure order imposed under this section, the administering
authority shall promptly publish a notice of the expiration in the
Federal Register.
``(i) Suspension or Termination of Proceedings or Countermeasures;
Temporary Reduction of Countermeasures.--
``(1) If injurious pricing order revoked or suspended.--If an
injurious pricing order has been revoked or suspended under
section 806(d) or (e), the administering authority shall, as
appropriate, suspend or terminate proceedings under this
section with respect to that order, or suspend or revoke a
countermeasure order issued with respect to that injurious
pricing order.
``(2) If payment date amended.--(A) Subject to subparagraph
(C), if the payment date under an injurious pricing order is
amended under section 845, the administering authority shall,
as appropriate, suspend proceedings or modify deadlines under
this section, or suspend or amend a countermeasure order issued
with respect to that injurious pricing order.
``(B) In taking action under subparagraph (A), the
administering authority shall ensure that countermeasures are
not applied before the date that is 30 days after publication
in the Federal Register of the amended payment date.
``(C) If--
``(i) a countermeasure order is issued under
subsection (c) before an amendment is made under
section 845 to the payment date of the injurious
pricing order to which the countermeasure order
applies, and
``(ii) the administering authority determines that
the period of time between the original payment date
and the amended payment date is significant for
purposes of determining the appropriate scope or
duration of countermeasures,
the administering authority may, in lieu of acting under
subparagraph (A), reinstitute proceedings under subsection (c)
for purposes of issuing a new determination under that
subsection.
``(j) Comment and Hearing.--In the course of any proceeding under
subsection (c), (d), (e), or (g), the administering authority--
``(1) shall solicit comments from interested parties, and
``(2)(A) in a proceeding under subsection (c) or (d), upon
the request of an interested party, shall hold a hearing in
accordance with section 841(b) in connection with that
proceeding, or
``(B) in a proceeding under subsection (e) or (g), upon the
request of an interested party, may hold a hearing in
accordance with section 841(b) in connection with that
proceeding.
``SEC. 808. INJURIOUS PRICING PETITIONS BY THIRD COUNTRIES.
``(a) Filing of Petition.--The government of a Shipbuilding Agreement
Party may file with the Trade Representative a petition requesting that
an investigation be conducted to determine if--
``(1) a vessel from another Shipbuilding Agreement Party has
been sold in the United States at less than fair value, and
``(2) an industry, in the petitioning country, producing or
capable of producing a like vessel is materially injured by
reason of such sale.
``(b) Initiation.--The Trade Representative, after consultation with
the administering authority and the Commission and obtaining the
approval of the Parties Group under the Shipbuilding Agreement, shall
determine whether to initiate an investigation described in subsection
(a).
``(c) Determinations.--Upon initiation of an investigation under
subsection (a), the Trade Representative shall request the following
determinations be made in accordance with substantive and procedural
requirements specified by the Trade Representative, notwithstanding any
other provision of this title:
``(1) The administering authority shall determine whether the
subject vessel has been sold at less than fair value.
``(2) The Commission shall determine whether an industry in
the petitioning country is materially injured by reason of the
sale of the subject vessel in the United States.
``(d) Public Comment.--An opportunity for public comment shall be
provided, as appropriate--
``(1) by the Trade Representative, in making the
determinations required by subsection (b), and
``(2) by the administering authority and the Commission, in
making the determinations required by subsection (c).
``(e) Issuance of Order.--If the administering authority makes an
affirmative determination under paragraph (1) of subsection (c), and
the Commission makes an affirmative determination under paragraph (2)
of subsection (c), the administering authority shall--
``(1) order an injurious pricing charge in accordance with
section 806, and
``(2) make such determinations and take such other actions as
are required by sections 806 and 807, as if affirmative
determinations had been made under subsections (a) and (b) of
section 805.
``(f) Reviews of Determinations.--For purposes of review under
section 516B, if an order is issued under subsection (e)--
``(1) the final determinations of the administering authority
and the Commission under subsection (c) shall be treated as
final determinations made under section 805, and
``(2) determinations of the administering authority under
subsection (e)(2) shall be treated as determinations made under
section 806 or 807, as the case may be.
``(g) Access to Information.--Section 843 shall apply to
investigations under this section, to the extent specified by the Trade
Representative, after consultation with the administering authority and
the Commission.
``Subtitle B--Special Rules
``SEC. 821. EXPORT PRICE.
``(a) Export Price.--For purposes of this title, the term `export
price' means the price at which the subject vessel is first sold (or
agreed to be sold) by or for the account of the foreign producer of the
subject vessel to an unaffiliated United States buyer. The term `sold
(or agreed to be sold) by or for the account of the foreign producer'
includes any transfer of an ownership interest, including by way of
lease or long-term bareboat charter, in conjunction with the original
transfer from the producer, either directly or indirectly, to a United
States buyer.
``(b) Adjustments to Export Price.--The price used to establish
export price shall be--
``(1) increased by the amount of any import duties imposed by
the country of exportation which have been rebated, or which
have not been collected, by reason of the exportation of the
subject vessel, and
``(2) reduced by--
``(A) the amount, if any, included in such price,
attributable to any additional costs, charges, or
expenses which are incident to bringing the subject
vessel from the shipyard in the exporting country to
the place of delivery,
``(B) the amount, if included in such price, of any
export tax, duty, or other charge imposed by the
exporting country on the exportation of the subject
vessel, and
``(C) all other expenses incidental to placing the
vessel in condition for delivery to the buyer.
``SEC. 822. NORMAL VALUE.
``(a) Determination.--In determining under this title whether a
subject vessel has been sold at less than fair value, a fair comparison
shall be made between the export price and normal value of the subject
vessel. In order to achieve a fair comparison with the export price,
normal value shall be determined as follows:
``(1) Determination of normal value.--
``(A) In general.--The normal value of the subject
vessel shall be the price described in subparagraph
(B), at a time reasonably corresponding to the time of
the sale used to determine the export price under
section 821(a).
``(B) Price.--The price referred to in subparagraph
(A) is--
``(i) the price at which a foreign like
vessel is first sold in the exporting country,
in the ordinary course of trade and, to the
extent practicable, at the same level of trade,
or
``(ii) in a case to which subparagraph (C)
applies, the price at which a foreign like
vessel is so sold for consumption in a country
other than the exporting country or the United
States, if--
``(I) such price is representative,
and
``(II) the administering authority
does not determine that the particular
market situation in such other country
prevents a proper comparison with the
export price.
``(C) Third country sales.--This subparagraph applies
when--
``(i) a foreign like vessel is not sold in
the exporting country as described in
subparagraph (B)(i), or
``(ii) the particular market situation in the
exporting country does not permit a proper
comparison with the export price.
``(D) Contemporaneous sale.--For purposes of
subparagraph (A), `a time reasonably corresponding to
the time of the sale' means within 3 months before or
after the sale of the subject vessel or, in the absence
of such sales, such longer period as the administering
authority determines would be appropriate.
``(2) Fictitious markets.--No pretended sale, and no sale
intended to establish a fictitious market, shall be taken into
account in determining normal value.
``(3) Use of constructed value.--If the administering
authority determines that the normal value of the subject
vessel cannot be determined under paragraph (1)(B) or (1)(C),
then the normal value of the subject vessel shall be the
constructed value of that vessel, as determined under
subsection (e).
``(4) Indirect sales.--If a foreign like vessel is sold
through an affiliated party, the price at which the foreign
like vessel is sold by such affiliated party may be used in
determining normal value.
``(5) Adjustments.--The price described in paragraph (1)(B)
shall be--
``(A) reduced by--
``(i) the amount, if any, included in the
price described in paragraph (1)(B),
attributable to any costs, charges, and
expenses incident to bringing the foreign like
vessel from the shipyard to the place of
delivery to the purchaser,
``(ii) the amount of any taxes imposed
directly upon the foreign like vessel or
components thereof which have been rebated, or
which have not been collected, on the subject
vessel, but only to the extent that such taxes
are added to or included in the price of the
foreign like vessel, and
``(iii) the amount of all other expenses
incidental to placing the foreign like vessel
in condition for delivery to the buyer, and
``(B) increased or decreased by the amount of any
difference (or lack thereof) between the export price
and the price described in paragraph (1)(B) (other than
a difference for which allowance is otherwise provided
under this section) that is established to the
satisfaction of the administering authority to be
wholly or partly due to--
``(i) physical differences between the
subject vessel and the vessel used in
determining normal value, or
``(ii) other differences in the circumstances
of sale.
``(6) Adjustments for level of trade.--The price described in
paragraph (1)(B) shall also be increased or decreased to make
due allowance for any difference (or lack thereof) between the
export price and the price described in paragraph (1)(B) (other
than a difference for which allowance is otherwise made under
this section) that is shown to be wholly or partly due to a
difference in level of trade between the export price and
normal value, if the difference in level of trade--
``(A) involves the performance of different selling
activities, and
``(B) is demonstrated to affect price comparability,
based on a pattern of consistent price differences
between sales at different levels of trade in the
country in which normal value is determined.
In a case described in the preceding sentence, the amount of
the adjustment shall be based on the price differences between
the two levels of trade in the country in which normal value is
determined.
``(7) Adjustments to constructed value.--Constructed value as
determined under subsection (d) may be adjusted, as
appropriate, pursuant to this subsection.
``(b) Sales at Less Than Cost of Production.--
``(1) Determination; sales disregarded.--Whenever the
administering authority has reasonable grounds to believe or
suspect that the sale of the foreign like vessel under
consideration for the determination of normal value has been
made at a price which represents less than the cost of
production of the foreign like vessel, the administering
authority shall determine whether, in fact, such sale was made
at less than the cost of production. If the administering
authority determines that the sale was made at less than the
cost of production and was not at a price which permits
recovery of all costs within 5 years, such sale may be
disregarded in the determination of normal value. Whenever such
a sale is disregarded, normal value shall be based on another
sale of a foreign like vessel in the ordinary course of trade.
If no sales made in the ordinary course of trade remain, the
normal value shall be based on the constructed value of the
subject vessel.
``(2) Definitions and special rules.--For purposes of this
subsection:
``(A) Reasonable grounds to believe or suspect.--
There are reasonable grounds to believe or suspect that
the sale of a foreign like vessel was made at a price
that is less than the cost of production of the vessel,
if an interested party described in subparagraph (C),
(D), (E), or (F) of section 861(17) provides
information, based upon observed prices or constructed
prices or costs, that the sale of the foreign like
vessel under consideration for the determination of
normal value has been made at a price which represents
less than the cost of production of the vessel.
``(B) Recovery of costs.--If the price is below the
cost of production at the time of sale but is above the
weighted average cost of production for the period of
investigation, such price shall be considered to
provide for recovery of costs within 5 years.
``(3) Calculation of cost of production.--For purposes of
this section, the cost of production shall be an amount equal
to the sum of--
``(A) the cost of materials and of fabrication or
other processing of any kind employed in producing the
foreign like vessel, during a period which would
ordinarily permit the production of that vessel in the
ordinary course of business, and
``(B) an amount for selling, general, and
administrative expenses based on actual data pertaining
to the production and sale of the foreign like vessel
by the producer in question.
For purposes of subparagraph (A), if the normal value is based
on the price of the foreign like vessel sold in a country other
than the exporting country, the cost of materials shall be
determined without regard to any internal tax in the exporting
country imposed on such materials or on their disposition which
are remitted or refunded upon exportation.
``(c) Nonmarket Economy Countries.--
``(1) In general.--If--
``(A) the subject vessel is produced in a nonmarket
economy country, and
``(B) the administering authority finds that
available information does not permit the normal value
of the subject vessel to be determined under subsection
(a),
the administering authority shall determine the normal value of
the subject vessel on the basis of the value of the factors of
production utilized in producing the vessel and to which shall
be added an amount for general expenses and profit plus the
cost of expenses incidental to placing the vessel in a
condition for delivery to the buyer. Except as provided in
paragraph (2), the valuation of the factors of production shall
be based on the best available information regarding the values
of such factors in a market economy country or countries
considered to be appropriate by the administering authority.
``(2) Exception.--If the administering authority finds that
the available information is inadequate for purposes of
determining the normal value of the subject vessel under
paragraph (1), the administering authority shall determine the
normal value on the basis of the price at which a vessel that
is--
``(A) comparable to the subject vessel, and
``(B) produced in one or more market economy
countries that are at a level of economic development
comparable to that of the nonmarket economy country,
is sold in other countries, including the United States.
``(3) Factors of production.--For purposes of paragraph (1),
the factors of production utilized in producing the vessel
include, but are not limited to--
``(A) hours of labor required,
``(B) quantities of raw materials employed,
``(C) amounts of energy and other utilities consumed,
and
``(D) representative capital cost, including
depreciation.
``(4) Valuation of factors of production.--The administering
authority, in valuing factors of production under paragraph
(1), shall utilize, to the extent possible, the prices or costs
of factors of production in one or more market economy
countries that are--
``(A) at a level of economic development comparable
to that of the nonmarket economy country, and
``(B) significant producers of comparable vessels.
``(d) Special Rule for Certain Multinational Corporations.--Whenever,
in the course of an investigation under this title, the administering
authority determines that--
``(1) the subject vessel was produced in facilities which are
owned or controlled, directly or indirectly, by a person, firm,
or corporation which also owns or controls, directly or
indirectly, other facilities for the production of a foreign
like vessel which are located in another country or countries,
``(2) subsection (a)(1)(C) applies, and
``(3) the normal value of a foreign like vessel produced in
one or more of the facilities outside the exporting country is
higher than the normal value of the foreign like vessel
produced in the facilities located in the exporting country,
the administering authority shall determine the normal value of the
subject vessel by reference to the normal value at which a foreign like
vessel is sold from one or more facilities outside the exporting
country. The administering authority, in making any determination under
this subsection, shall make adjustments for the difference between the
costs of production (including taxes, labor, materials, and overhead)
of the foreign like vessel produced in facilities outside the exporting
country and costs of production of the foreign like vessel produced in
facilities in the exporting country, if such differences are
demonstrated to its satisfaction.
``(e) Constructed Value.--
``(1) In general.--For purposes of this title, the
constructed value of a subject vessel shall be an amount equal
to the sum of--
``(A) the cost of materials and fabrication or other
processing of any kind employed in producing the
subject vessel, during a period which would ordinarily
permit the production of the vessel in the ordinary
course of business, and
``(B)(i) the actual amounts incurred and realized by
the foreign producer of the subject vessel for selling,
general, and administrative expenses, and for profits,
in connection with the production and sale of a foreign
like vessel, in the ordinary course of trade, in the
domestic market of the country of origin of the subject
vessel, or
``(ii) if actual data are not available with respect
to the amounts described in clause (i), then--
``(I) the actual amounts incurred and
realized by the foreign producer of the subject
vessel for selling, general, and administrative
expenses, and for profits, in connection with
the production and sale of the same general
category of vessel in the domestic market of
the country of origin of the subject vessel,
``(II) the weighted average of the actual
amounts incurred and realized by producers in
the country of origin of the subject vessel
(other than the producer of the subject vessel)
for selling, general, and administrative
expenses, and for profits, in connection with
the production and sale of a foreign like
vessel, in the ordinary course of trade, in the
domestic market, or
``(III) if data is not available under
subclause (I) or (II), the amounts incurred and
realized for selling, general, and
administrative expenses, and for profits, based
on any other reasonable method, except that the
amount allowed for profit may not exceed the
amount normally realized by foreign producers
(other than the producer of the subject vessel)
in connection with the sale of vessels in the
same general category of vessel as the subject
vessel in the domestic market of the country of
origin of the subject vessel.
The profit shall, for purposes of this paragraph, be based on
the average profit realized over a reasonable period of time
before and after the sale of the subject vessel and shall
reflect a reasonable profit at the time of such sale. For
purposes of the preceding sentence, a `reasonable period of
time' shall not, except where otherwise appropriate, exceed 6
months before, or 6 months after, the sale of the subject
vessel. In calculating profit under this paragraph, any
distortion which would result in other than a profit which is
reasonable at the time of the sale shall be eliminated.
``(2) Costs and profits based on other reasonable methods.--
When costs and profits are determined under paragraph
(1)(B)(ii)(III), such determination shall, except where
otherwise appropriate, be based on appropriate export sales by
the producer of the subject vessel or, absent such sales, to
export sales by other producers of a foreign like vessel or the
same general category of vessel as the subject vessel in the
country of origin of the subject vessel.
``(3) Costs of materials.--For purposes of paragraph (1)(A),
the cost of materials shall be determined without regard to any
internal tax in the exporting country imposed on such materials
or their disposition which are remitted or refunded upon
exportation of the subject vessel produced from such materials.
``(f) Special Rules for Calculation of Cost of Production and for
Calculation of Constructed Value.--For purposes of subsections (b) and
(e)--
``(1) Costs.--
``(A) In general.--Costs shall normally be calculated
based on the records of the foreign producer of the
subject vessel, if such records are kept in accordance
with the generally accepted accounting principles of
the exporting country and reasonably reflect the costs
associated with the production and sale of the vessel.
The administering authority shall consider all
available evidence on proper allocation of costs,
including that which is made available by the foreign
producer on a timely basis, if such allocations have
been historically used by the foreign producer, in
particular for establishing appropriate amortization
and depreciation periods, and allowances for capital
expenditures and other development costs.
``(B) Nonrecurring costs.--Costs shall be adjusted
appropriately for those nonrecurring costs that benefit
current or future production, or both.
``(C) Startup costs.--
``(i) In general.--Costs shall be adjusted
appropriately for circumstances in which costs
incurred during the time period covered by the
investigation are affected by startup
operations.
``(ii) Startup operations.--Adjustments shall
be made for startup operations only where--
``(I) a producer is using new
production facilities or producing a
new type of vessel that requires
substantial additional investment, and
``(II) production levels are limited
by technical factors associated with
the initial phase of commercial
production.
For purposes of subclause (II), the initial
phase of commercial production ends at the end
of the startup period. In determining whether
commercial production levels have been
achieved, the administering authority shall
consider factors unrelated to startup
operations that might affect the volume of
production processed, such as demand,
seasonality, or business cycles.
``(iii) Adjustment for startup operations.--
The adjustment for startup operations shall be
made by substituting the unit production costs
incurred with respect to the vessel at the end
of the startup period for the unit production
costs incurred during the startup period. If
the startup period extends beyond the period of
the investigation under this title, the
administering authority shall use the most
recent cost of production data that it
reasonably can obtain, analyze, and verify
without delaying the timely completion of the
investigation. For purposes of this
subparagraph, the startup period ends at the
point at which the level of commercial
production that is characteristic of the
vessel, the producer, or the industry is
achieved.
``(D) Costs due to extraordinary circumstances not
included.--Costs shall not include actual costs which
are due to extraordinary circumstances (including, but
not limited to, labor disputes, fire, and natural
disasters) and which are significantly over the cost
increase which the shipbuilder could have reasonably
anticipated and taken into account at the time of sale.
``(2) Transactions disregarded.--A transaction directly or
indirectly between affiliated persons may be disregarded if, in
the case of any element of value required to be considered, the
amount representing that element does not fairly reflect the
amount usually reflected in sales of a like vessel in the
market under consideration. If a transaction is disregarded
under the preceding sentence and no other transactions are
available for consideration, the determination of the amount
shall be based on the information available as to what the
amount would have been if the transaction had occurred between
persons who are not affiliated.
``(3) Major input rule.--If, in the case of a transaction
between affiliated persons involving the production by one of
such persons of a major input to the subject vessel, the
administering authority has reasonable grounds to believe or
suspect that an amount represented as the value of such input
is less than the cost of production of such input, then the
administering authority may determine the value of the major
input on the basis of the information available regarding such
cost of production, if such cost is greater than the amount
that would be determined for such input under paragraph (2).
``SEC. 823. CURRENCY CONVERSION.
``(a) In General.--In an injurious pricing proceeding under this
title, the administering authority shall convert foreign currencies
into United States dollars using the exchange rate in effect on the
date of sale of the subject vessel, except that if it is established
that a currency transaction on forward markets is directly linked to a
sale under consideration, the exchange rate specified with respect to
such foreign currency in the forward sale agreement shall be used to
convert the foreign currency.
``(b) Date of Sale.--For purposes of this section, `date of sale'
means the date of the contract of sale or, where appropriate, the date
on which the material terms of sale are otherwise established. If the
material terms of sale are significantly changed after such date, the
date of sale is the date of such change. In the case of such a change
in the date of sale, the administering authority shall make appropriate
adjustments to take into account any unreasonable effect on the
injurious pricing margin due only to fluctuations in the exchange rate
between the original date of sale and the new date of sale.
``Subtitle C--Procedures
``SEC. 841. HEARINGS.
``(a) Upon Request.--The administering authority and the Commission
shall each hold a hearing in the course of an investigation under this
title, upon the request of any party to the investigation, before
making a final determination under section 805.
``(b) Procedures.--Any hearing required or permitted under this title
shall be conducted after notice published in the Federal Register, and
a transcript of the hearing shall be prepared and made available to the
public. The hearing shall not be subject to the provisions of
subchapter II of chapter 5 of title 5, United States Code, or to
section 702 of such title.
``SEC. 842. DETERMINATIONS ON THE BASIS OF THE FACTS AVAILABLE.
``(a) In General.--If--
``(1) necessary information is not available on the record,
or
``(2) an interested party or any other person--
``(A) withholds information that has been requested
by the administering authority or the Commission under
this title,
``(B) fails to provide such information by the
deadlines for the submission of the information or in
the form and manner requested, subject to subsections
(b)(1) and (d) of section 844,
``(C) significantly impedes a proceeding under this
title, or
``(D) provides such information but the information
cannot be verified as provided in section 844(g),
the administering authority and the Commission shall, subject
to section 844(c), use the facts otherwise available in
reaching the applicable determination under this title.
``(b) Adverse Inferences.--If the administering authority or the
Commission (as the case may be) finds that an interested party has
failed to cooperate by not acting to the best of its ability to comply
with a request for information from the administering authority or the
Commission, the administering authority or the Commission (as the case
may be), in reaching the applicable determination under this title, may
use an inference that is adverse to the interests of that party in
selecting from among the facts otherwise available. Such adverse
inference may include reliance on information derived from--
``(1) the petition, or
``(2) any other information placed on the record.
``(c) Corroboration of Secondary Information.--When the administering
authority or the Commission relies on secondary information rather than
on information obtained in the course of an investigation under this
title, the administering authority and the Commission, as the case may
be, shall, to the extent practicable, corroborate that information from
independent sources that are reasonably at their disposal.
``SEC. 843. ACCESS TO INFORMATION.
``(a) Information Generally Made Available.--
``(1) Progress of investigation reports.--The administering
authority and the Commission shall, from time to time upon
request, inform the parties to an investigation under this
title of the progress of that investigation.
``(2) Ex parte meetings.--The administering authority and the
Commission shall maintain a record of any ex parte meeting
between--
``(A) interested parties or other persons providing
factual information in connection with a proceeding
under this title, and
``(B) the person charged with making the
determination, or any person charged with making a
final recommendation to that person, in connection with
that proceeding,
if information relating to that proceeding was presented or
discussed at such meeting. The record of such an ex parte
meeting shall include the identity of the persons present at
the meeting, the date, time, and place of the meeting, and a
summary of the matters discussed or submitted. The record of
the ex parte meeting shall be included in the record of the
proceeding.
``(3) Summaries; non-proprietary submissions.--The
administering authority and the Commission shall disclose--
``(A) any proprietary information received in the
course of a proceeding under this title if it is
disclosed in a form which cannot be associated with, or
otherwise be used to identify, operations of a
particular person, and
``(B) any information submitted in connection with a
proceeding which is not designated as proprietary by
the person submitting it.
``(4) Maintenance of public record.--The administering
authority and the Commission shall maintain and make available
for public inspection and copying a record of all information
which is obtained by the administering authority or the
Commission, as the case may be, in a proceeding under this
title to the extent that public disclosure of the information
is not prohibited under this chapter or exempt from disclosure
under section 552 of title 5, United States Code.
``(b) Proprietary Information.--
``(1) Proprietary status maintained.--
``(A) In general.--Except as provided in subsection
(a)(4) and subsection (c), information submitted to the
administering authority or the Commission which is
designated as proprietary by the person submitting the
information shall not be disclosed to any person
without the consent of the person submitting the
information, other than--
``(i) to an officer or employee of the
administering authority or the Commission who
is directly concerned with carrying out the
investigation in connection with which the
information is submitted or any other
proceeding under this title covering the same
subject vessel, or
``(ii) to an officer or employee of the
United States Customs Service who is directly
involved in conducting an investigation
regarding fraud under this title.
``(B) Additional requirements.--The administering
authority and the Commission shall require that
information for which proprietary treatment is
requested be accompanied by--
``(i) either--
``(I) a nonproprietary summary in
sufficient detail to permit a
reasonable understanding of the
substance of the information submitted
in confidence, or
``(II) a statement that the
information is not susceptible to
summary, accompanied by a statement of
the reasons in support of the
contention, and
``(ii) either--
``(I) a statement which permits the
administering authority or the
Commission to release under
administrative protective order, in
accordance with subsection (c), the
information submitted in confidence, or
``(II) a statement to the
administering authority or the
Commission that the business
proprietary information is of a type
that should not be released under
administrative protective order.
``(2) Unwarranted designation.--If the administering
authority or the Commission determines, on the basis of the
nature and extent of the information or its availability from
public sources, that designation of any information as
proprietary is unwarranted, then it shall notify the person who
submitted it and ask for an explanation of the reasons for the
designation. Unless that person persuades the administering
authority or the Commission that the designation is warranted,
or withdraws the designation, the administering authority or
the Commission, as the case may be, shall return it to the
party submitting it. In a case in which the administering
authority or the Commission returns the information to the
person submitting it, the person may thereafter submit other
material concerning the subject matter of the returned
information if the submission is made within the time otherwise
provided for submitting such material.
``(c) Limited Disclosure of Certain Proprietary Information Under
Protective Order.--
``(1) Disclosure by administering authority or commission.--
``(A) In general.--Upon receipt of an application
(before or after receipt of the information requested)
which describes in general terms the information
requested and sets forth the reasons for the request,
the administering authority or the Commission shall
make all business proprietary information presented to,
or obtained by it, during a proceeding under this title
(except privileged information, classified information,
and specific information of a type for which there is a
clear and compelling need to withhold from disclosure)
available to all interested parties who are parties to
the proceeding under a protective order described in
subparagraph (B), regardless of when the information is
submitted during the proceeding. Customer names (other
than the name of the United States buyer of the subject
vessel) obtained during any investigation which
requires a determination under section 805(b) may not
be disclosed by the administering authority under
protective order until either an order is published
under section 806(a) as a result of the investigation
or the investigation is suspended or terminated. The
Commission may delay disclosure of customer names
(other than the name of the United States buyer of the
subject vessel) under protective order during any such
investigation until a reasonable time before any
hearing provided under section 841 is held.
``(B) Protective order.--The protective order under
which information is made available shall contain such
requirements as the administering authority or the
Commission may determine by regulation to be
appropriate. The administering authority and the
Commission shall provide by regulation for such
sanctions as the administering authority and the
Commission determine to be appropriate, including
disbarment from practice before the agency.
``(C) Time limitations on determinations.--The
administering authority or the Commission, as the case
may be, shall determine whether to make information
available under this paragraph--
``(i) not later than 14 days (7 days if the
submission pertains to a proceeding under
section 803(a)) after the date on which the
information is submitted, or
``(ii) if--
``(I) the person submitting the
information raises objection to its
release, or
``(II) the information is unusually
voluminous or complex,
not later than 30 days (10 days if the
submission pertains to a proceeding under
section 803(a)) after the date on which the
information is submitted.
``(D) Availability after determination.--If the
determination under subparagraph (C) is affirmative,
then--
``(i) the business proprietary information
submitted to the administering authority or the
Commission on or before the date of the
determination shall be made available, subject
to the terms and conditions of the protective
order, on such date, and
``(ii) the business proprietary information
submitted to the administering authority or the
Commission after the date of the determination
shall be served as required by subsection (d).
``(E) Failure to disclose.--If a person submitting
information to the administering authority refuses to
disclose business proprietary information which the
administering authority determines should be released
under a protective order described in subparagraph (B),
the administering authority shall return the
information, and any nonconfidential summary thereof,
to the person submitting the information and summary
and shall not consider either.
``(2) Disclosure under court order.--If the administering
authority or the Commission denies a request for information
under paragraph (1), then application may be made to the United
States Court of International Trade for an order directing the
administering authority or the Commission, as the case may be,
to make the information available. After notification of all
parties to the investigation and after an opportunity for a
hearing on the record, the court may issue an order, under such
conditions as the court deems appropriate, which shall not have
the effect of stopping or suspending the investigation,
directing the administering authority or the Commission to make
all or a portion of the requested information described in the
preceding sentence available under a protective order and
setting forth sanctions for violation of such order if the
court finds that, under the standards applicable in proceedings
of the court, such an order is warranted, and that--
``(A) the administering authority or the Commission
has denied access to the information under subsection
(b)(1),
``(B) the person on whose behalf the information is
requested is an interested party who is a party to the
investigation in connection with which the information
was obtained or developed, and
``(C) the party which submitted the information to
which the request relates has been notified, in advance
of the hearing, of the request made under this section
and of its right to appear and be heard.
``(d) Service.--Any party submitting written information, including
business proprietary information, to the administering authority or the
Commission during a proceeding shall, at the same time, serve the
information upon all interested parties who are parties to the
proceeding, if the information is covered by a protective order. The
administering authority or the Commission shall not accept any such
information that is not accompanied by a certificate of service and a
copy of the protective order version of the document containing the
information. Business proprietary information shall only be served upon
interested parties who are parties to the proceeding that are subject
to protective order, except that a nonconfidential summary thereof
shall be served upon all other interested parties who are parties to
the proceeding.
``(e) Information Relating to Violations of Protective Orders and
Sanctions.--The administering authority and the Commission may withhold
from disclosure any correspondence, private letters of reprimand,
settlement agreements, and documents and files compiled in relation to
investigations and actions involving a violation or possible violation
of a protective order issued under subsection (c), and such information
shall be treated as information described in section 552(b)(3) of title
5, United States Code.
``(f) Opportunity for Comment by Vessel Buyers.--The administering
authority and the Commission shall provide an opportunity for buyers of
subject vessels to submit relevant information to the administering
authority concerning a sale at less than fair value or countermeasures,
and to the Commission concerning material injury by reason of the sale
of a vessel at less than fair value.
``(g) Publication of Determinations; Requirements for Final
Determinations.--
``(1) In general.--Whenever the administering authority makes
a determination under section 802 whether to initiate an
investigation, or the administering authority or the Commission
makes a preliminary determination under section 803, a final
determination under section 805, a determination under
subsection (b), (c), (d), (e)(3)(B)(ii), (g), or (i) of section
807, or a determination to suspend an investigation under this
title, the administering authority or the Commission, as the
case may be, shall publish the facts and conclusions supporting
that determination, and shall publish notice of that
determination in the Federal Register.
``(2) Contents of notice or determination.--The notice or
determination published under paragraph (1) shall include, to
the extent applicable--
``(A) in the case of a determination of the
administering authority--
``(i) the names of the foreign producer and
the country of origin of the subject vessel,
``(ii) a description sufficient to identify
the subject vessel,
``(iii) with respect to an injurious pricing
charge, the injurious pricing margin
established and a full explanation of the
methodology used in establishing such margin,
``(iv) with respect to countermeasures, the
scope and duration of countermeasures and, if
applicable, any changes thereto, and
``(v) the primary reasons for the
determination, and
``(B) in the case of a determination of the
Commission--
``(i) considerations relevant to the
determination of injury, and
``(ii) the primary reasons for the
determination.
``(3) Additional requirements for final determinations.--In
addition to the requirements set forth in paragraph (2)--
``(A) the administering authority shall include in a
final determination under section 805 or 807(c) an
explanation of the basis for its determination that
addresses relevant arguments, made by interested
parties who are parties to the investigation,
concerning the establishment of the injurious pricing
charge with respect to which the determination is made,
and
``(B) the Commission shall include in a final
determination of injury an explanation of the basis for
its determination that addresses relevant arguments
that are made by interested parties who are parties to
the investigation concerning the effects and impact on
the industry of the sale of the subject vessel.
``SEC. 844. CONDUCT OF INVESTIGATIONS.
``(a) Certification of Submissions.--Any person providing factual
information to the administering authority or the Commission in
connection with a proceeding under this title on behalf of the
petitioner or any other interested party shall certify that such
information is accurate and complete to the best of that person's
knowledge.
``(b) Difficulties in Meeting Requirements.--
``(1) Notification by interested party.--If an interested
party, promptly after receiving a request from the
administering authority or the Commission for information,
notifies the administering authority or the Commission (as the
case may be) that such party is unable to submit the
information requested in the requested form and manner,
together with a full explanation and suggested alternative
forms in which such party is able to submit the information,
the administering authority or the Commission (as the case may
be) shall consider the ability of the interested party to
submit the information in the requested form and manner and may
modify such requirements to the extent necessary to avoid
imposing an unreasonable burden on that party.
``(2) Assistance to interested parties.--The administering
authority and the Commission shall take into account any
difficulties experienced by interested parties, particularly
small companies, in supplying information requested by the
administering authority or the Commission in connection with
investigations under this title, and shall provide to such
interested parties any assistance that is practicable in
supplying such information.
``(c) Deficient Submissions.--If the administering authority or the
Commission determines that a response to a request for information
under this title does not comply with the request, the administering
authority or the Commission (as the case may be) shall promptly inform
the person submitting the response of the nature of the deficiency and
shall, to the extent practicable, provide that person with an
opportunity to remedy or explain the deficiency in light of the time
limits established for the completion of investigations or reviews
under this title. If that person submits further information in
response to such deficiency and either--
``(1) the administering authority or the Commission (as the
case may be) finds that such response is not satisfactory, or
``(2) such response is not submitted within the applicable
time limits,
then the administering authority or the Commission (as the case may be)
may, subject to subsection (d), disregard all or part of the original
and subsequent responses.
``(d) Use of Certain Information.--In reaching a determination under
section 803, 805, or 807, the administering authority and the
Commission shall not decline to consider information that is submitted
by an interested party and is necessary to the determination but does
not meet all the applicable requirements established by the
administering authority or the Commission if--
``(1) the information is submitted by the deadline
established for its submission,
``(2) the information can be verified,
``(3) the information is not so incomplete that it cannot
serve as a reliable basis for reaching the applicable
determination,
``(4) the interested party has demonstrated that it acted to
the best of its ability in providing the information and
meeting the requirements established by the administering
authority or the Commission with respect to the information,
and
``(5) the information can be used without undue difficulties.
``(e) Nonacceptance of Submissions.--If the administering authority
or the Commission declines to accept into the record any information
submitted in an investigation under this title, it shall, to the extent
practicable, provide to the person submitting the information a written
explanation of the reasons for not accepting the information.
``(f) Public Comment on Information.--Information that is submitted
on a timely basis to the administering authority or the Commission
during the course of a proceeding under this title shall be subject to
comment by other parties within such reasonable time as the
administering authority or the Commission shall provide. The
administering authority and the Commission, before making a final
determination under section 805 or 807, shall cease collecting
information and shall provide the parties with a final opportunity to
comment on the information obtained by the administering authority or
the Commission (as the case may be) upon which the parties have not
previously had an opportunity to comment. Comments containing new
factual information shall be disregarded.
``(g) Verification.--The administering authority shall verify all
information relied upon in making a final determination under section
805.
``SEC. 845. ADMINISTRATIVE ACTION FOLLOWING SHIPBUILDING AGREEMENT
PANEL REPORTS.
``(a) Action by United States International Trade Commission.--
``(1) Advisory report.--If a dispute settlement panel under
the Shipbuilding Agreement finds in a report that an action by
the Commission in connection with a particular proceeding under
this title is not in conformity with the obligations of the
United States under the Shipbuilding Agreement, the Trade
Representative may request the Commission to issue an advisory
report on whether this title permits the Commission to take
steps in connection with the particular proceeding that would
render its action not inconsistent with the findings of the
panel concerning those obligations. The Trade Representative
shall notify the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate of
such request.
``(2) Time limits for report.--The Commission shall transmit
its report under paragraph (1) to the Trade Representative
within 30 calendar days after the Trade Representative requests
the report.
``(3) Consultations on request for commission
determination.--If a majority of the Commissioners issues an
affirmative report under paragraph (1), the Trade
Representatives shall consult with the congressional committees
listed in paragraph (1) concerning the matter.
``(4) Commission determination.--Notwithstanding any other
provision of this title, if a majority of the Commissioners
issues an affirmative report under paragraph (1), the
Commission, upon the written request of the Trade
Representative, shall issue a determination in connection with
the particular proceeding that would render the Commission's
action described in paragraph (1) not inconsistent with the
findings of the panel. The Commission shall issue its
determination not later than 120 calendar days after the
request from the Trade Representative is made.
``(5) Consultations on implementation of commission
determination.--The Trade Representative shall consult with the
congressional committees listed in paragraph (1) before the
Commission's determination under paragraph (4) is implemented.
``(6) Revocation of order.--If, by virtue of the Commission's
determination under paragraph (4), an injurious pricing order
is no longer supported by an affirmative Commission
determination under this title, the Trade Representative may,
after consulting with the congressional committees under
paragraph (5), direct the administering authority to revoke the
injurious pricing order.
``(b) Action by Administering Authority.--
``(1) Consultations with administering authority and
congressional committees.--Promptly after a report or other
determination by a dispute settlement panel under the
Shipbuilding Agreement is issued that contains findings that--
``(A) an action by the administering authority in a
proceeding under this title is not in conformity with
the obligations of the United States under the
Shipbuilding Agreement,
``(B) the due date for payment of an injurious
pricing charge contained in an order issued under
section 806 should be amended,
``(C) countermeasures provided for in an order issued
under section 807 should be provisionally suspended or
reduced pending the final decision of the panel, or
``(D) the scope or duration of countermeasures
imposed under section 807 should be narrowed or
shortened,
the Trade Representative shall consult with the administering
authority and the congressional committees listed in subsection
(a)(1) on the matter.
``(2) Determination by administering authority.--
Notwithstanding any other provision of this title, the
administering authority shall, in response to a written request
from the Trade Representative, issue a determination, or an
amendment to or suspension of an injurious pricing or
countermeasure order, as the case may be, in connection with
the particular proceeding that would render the administering
authority's action described in paragraph (1) not inconsistent
with the findings of the panel.
``(3) Time limits for determinations.--The administering
authority shall issue its determination, amendment, or
suspension under paragraph (2)--
``(A) with respect to a matter described in
subparagraph (A) of paragraph (1), within 180 calendar
days after the request from the Trade Representative is
made, and
``(B) with respect to a matter described in
subparagraph (B), (C), or (D) of paragraph (1), within
15 calendar days after the request from the Trade
Representative is made.
``(4) Consultations before implementation.--Before the
administering authority implements any determination,
amendment, or suspension under paragraph (2), the Trade
Representative shall consult with the administering authority
and the congressional committees listed in subsection (a)(1)
with respect to such determination, amendment, or suspension.
``(5) Implementation of determination.--The Trade
Representative may, after consulting with the administering
authority and the congressional committees under paragraph (4),
direct the administering authority to implement, in whole or in
part, the determination, amendment, or suspension made under
paragraph (2).
``(6) Implementation of determination; notice of
implementation.--The administering authority shall implement
the determination, amendment, or suspension under paragraph
(2)--
``(A) with respect to a matter described in
subparagraph (A) of paragraph (1), only if the
injurious pricing margin determined under paragraph (2)
differs from the injurious pricing margin in the
determination reviewed by the panel, and
``(B) with respect to a matter described in
subparagraph (B), (C), or (D) of paragraph (1), upon
issuance of the determination, amendment, or suspension
under paragraph (2).
The administering authority shall publish notice of such
implementation in the Federal Register.
``(c) Opportunity for Comment by Interested Parties.--Before issuing
a determination, amendment, or suspension, the administering authority,
in a matter described in subsection (b)(1)(A), or the Commission, in a
matter described in subsection (a)(1), as the case may be, shall
provide interested parties with an opportunity to submit written
comments and, in appropriate cases, may hold a hearing, with respect to
the determination.
``Subtitle D--Definitions
``SEC. 861. DEFINITIONS.
``For purposes of this title:
``(1) Administering authority.--The term `administering
authority' means the Secretary of Commerce, or any other
officer of the United States to whom the responsibility for
carrying out the duties of the administering authority under
this title are transferred by law.
``(2) Commission.--The term `Commission' means the United
States International Trade Commission.
``(3) Country.--The term `country' means a foreign country, a
political subdivision, dependent territory, or possession of a
foreign country and, except as provided in paragraph
(16)(E)(iii), may not include an association of 2 or more
foreign countries, political subdivisions, dependent
territories, or possessions of countries into a customs union
outside the United States.
``(4) Industry.--
``(A) In general.--Except as used in section 808, the
term `industry' means the producers as a whole of a
domestic like vessel, or those producers whose
collective capability to produce a domestic like vessel
constitutes a major proportion of the total domestic
capability to produce a domestic like vessel.
``(B) Producer.--A `producer' of a domestic like
vessel includes an entity that is producing the
domestic like vessel and an entity with the capability
to produce the domestic like vessel.
``(C) Capability to produce a domestic like vessel.--
A producer has the `capability to produce a domestic
like vessel' if it is capable of producing a domestic
like vessel with its present facilities or could adapt
its facilities in a timely manner to produce a domestic
like vessel.
``(D) Related parties.--(i) In an investigation under
this title, if a producer of a domestic like vessel and
the foreign producer, seller (other than the foreign
producer), or United States buyer of the subject vessel
are related parties, or if a producer of a domestic
like vessel is also a United States buyer of the
subject vessel, the domestic producer may, in
appropriate circumstances, be excluded from the
industry.
``(ii) For purposes of clause (i), a domestic
producer and the foreign producer, seller, or United
States buyer shall be considered to be related parties,
if--
``(I) the domestic producer directly or
indirectly controls the foreign producer,
seller or United States buyer,
``(II) the foreign producer, seller, or
United States buyer directly or indirectly
controls the domestic producer,
``(III) a third party directly or indirectly
controls the domestic producer and the foreign
producer, seller, or United States buyer, or
``(IV) the domestic producer and the foreign
producer, seller, or United States buyer
directly or indirectly control a third party
and there is reason to believe that the
relationship causes the producer to act
differently than a nonrelated producer.
For purposes of this subparagraph, a party shall be
considered to directly or indirectly control another
party if the party is legally or operationally in a
position to exercise restraint or direction over the
other party.
``(E) Product lines.--In an investigation under this
title, the effect of the sale of the subject vessel
shall be assessed in relation to the United States
production (or production capability) of a domestic
like vessel if available data permit the separate
identification of production (or production capability)
in terms of such criteria as the production process or
the producer's profits. If the domestic production (or
production capability) of a domestic like vessel has no
separate identity in terms of such criteria, then the
effect of the sale shall be assessed by the examination
of the production (or production capability) of the
narrowest group or range of vessels, which includes a
domestic like vessel, for which the necessary
information can be provided.
``(5) Buyer.--The term `buyer' means any person who acquires
an ownership interest in a vessel, including by way of lease or
long-term bareboat charter, in conjunction with the original
transfer from the producer, either directly or indirectly,
including an individual or company which owns or controls a
buyer. There may be more than one buyer of any one vessel.
``(6) United states buyer.--The term `United States buyer'
means a buyer that is any of the following:
``(A) A United States citizen.
``(B) A juridical entity, including any corporation,
company, association, or other organization, that is
legally constituted under the laws and regulations of
the United States or a political subdivision thereof,
regardless of whether the entity is organized for
pecuniary gain, privately or government owned, or
organized with limited or unlimited liability.
``(C) A juridical entity that is owned or controlled
by nationals or entities described in subparagraphs (A)
and (B). For the purposes of this subparagraph--
``(i) the term `own' means having more than a
50 percent interest, and
``(ii) the term `control' means the actual
ability to have substantial influence on
corporate behavior, and control is presumed to
exist where there is at least a 25 percent
interest.
If ownership of a company is established under clause
(i), other control is presumed not to exist unless it
is otherwise established.
``(7) Ownership interest.--An `ownership interest' in a
vessel includes any contractual or proprietary interest which
allows the beneficiary or beneficiaries of such interest to
take advantage of the operation of the vessel in a manner
substantially comparable to the way in which an owner may
benefit from the operation of the vessel. In determining
whether such substantial comparability exists, the
administering authority shall consider--
``(A) the terms and circumstances of the transaction
which conveys the interest,
``(B) commercial practice,
``(C) whether the vessel subject to the transaction
is integrated into the operations of the beneficiary or
beneficiaries, and
``(D) whether in practice there is a likelihood that
the beneficiary or beneficiaries of such interests will
take advantage of and the risk for the operation of the
vessel for a significant part of the life-time of the
vessel.
``(8) Vessel.--
``(A) In general.--Except as otherwise specifically
provided under international agreements, the term
`vessel' means--
``(i) a self-propelled seagoing vessel of 100
gross tons or more used for transportation of
goods or persons or for performance of a
specialized service (including, but not limited
to, ice breakers and dredgers), and
``(ii) a tug of 365 kilowatts or more,
that is produced in a Shipbuilding Agreement Party or a
country that is not a Shipbuilding Agreement Party and
not a WTO member.
``(B) Exclusions.--The term `vessel' does not
include--
``(i) any fishing vessel destined for the
fishing fleet of the country in which the
vessel is built,
``(ii) any military vessel, and
``(iii) any vessel sold before the date that
the Shipbuilding Agreement enters into force
with respect to the United States, except that
any vessel sold after December 21, 1994, for
delivery more than 5 years after the date of
the contract of sale shall be a `vessel' for
purposes of this title unless the shipbuilder
demonstrates to the administering authority
that the extended delivery date was for normal
commercial reasons and not to avoid
applicability of this title.
``(C) Self-propelled seagoing vessel.--A vessel is
`self-propelled seagoing' if its permanent propulsion
and steering provide it all the characteristics of
self-navigability in the high seas.
``(D) Military vessel.--A `military vessel' is a
vessel which, according to its basic structural
characteristics and ability, is intended to be used
exclusively for military purposes.
``(9) Like vessel.--The term `like vessel' means a vessel of
the same type, same purpose, and approximate size as the
subject vessel and possessing characteristics closely
resembling those of the subject vessel.
``(10) Domestic like vessel.--The term `domestic like vessel'
means a like vessel produced in the United States.
``(11) Foreign like vessel.--Except as used in section
822(e)(1)(B)(ii)(II), the term `foreign like vessel' means a
like vessel produced by the foreign producer of the subject
vessel for sale in the producer's domestic market or in a third
country.
``(12) Same general category of vessel.--The term `same
general category of vessel' means a vessel of the same type and
purpose as the subject vessel, but of a significantly different
size.
``(13) Subject vessel.--The term `subject vessel' means a
vessel subject to investigation under section 801 or 808.
``(14) Foreign producer.--The term `foreign producer' means
the producer or producers of the subject vessel.
``(15) Exporting country.--The term `exporting country' means
the country in which the subject vessel was built.
``(16) Material injury.--
``(A) In general.--The term `material injury' means
harm which is not inconsequential, immaterial, or
unimportant.
``(B) Sale and consequent impact.--In making
determinations under sections 803(a) and 805(b), the
Commission in each case--
``(i) shall consider--
``(I) the sale of the subject vessel,
``(II) the effect of the sale of the
subject vessel on prices in the United
States for a domestic like vessel, and
``(III) the impact of the sale of the
subject vessel on domestic producers of
the domestic like vessel, but only in
the context of production operations
within the United States, and
``(ii) may consider such other economic
factors as are relevant to the determination
regarding whether there is or has been material
injury by reason of the sale of the subject
vessel.
In the notification required under section 805(d), the
Commission shall explain its analysis of each factor
considered under clause (i), and identify each factor
considered under clause (ii) and explain in full its
relevance to the determination.
``(C) Evaluation of relevant factors.--For purposes
of subparagraph (B)--
``(i) Sale of the subject vessel.--In
evaluating the sale of the subject vessel, the
Commission shall consider whether the sale,
either in absolute terms or relative to
production or demand in the United States, in
terms of either volume or value, is or has been
significant.
``(ii) Price.--In evaluating the effect of
the sale of the subject vessel on prices, the
Commission shall consider whether--
``(I) there has been significant
price underselling of the subject
vessel as compared with the price of a
domestic like vessel, and
``(II) the effect of the sale of the
subject vessel otherwise depresses or
has depressed prices to a significant
degree or prevents or has prevented
price increases, which otherwise would
have occurred, to a significant degree.
``(iii) Impact on affected domestic
industry.--In examining the impact required to
be considered under subparagraph (B)(i)(III),
the Commission shall evaluate all relevant
economic factors which have a bearing on the
state of the industry in the United States,
including, but not limited to--
``(I) actual and potential decline in
output, sales, market share, profits,
productivity, return on investments,
and utilization of capacity,
``(II) factors affecting domestic
prices, including with regard to sales,
``(III) actual and potential negative
effects on cash flow, employment,
wages, growth, ability to raise
capital, and investment,
``(IV) actual and potential negative
effects on the existing development and
production efforts of the domestic
industry, including efforts to develop
a derivative or more advanced version
of a domestic like vessel, and
``(V) the magnitude of the injurious
pricing margin.
The Commission shall evaluate all relevant
economic factors described in this clause
within the context of the business cycle and
conditions of competition that are distinctive
to the affected industry.
``(D) Standard for determination.--The presence or
absence of any factor which the Commission is required
to evaluate under subparagraph (C) shall not
necessarily give decisive guidance with respect to the
determination by the Commission of material injury.
``(E) Threat of material injury.--
``(i) In general.--In determining whether an
industry in the United States is threatened
with material injury by reason of the sale of
the subject vessel, the Commission shall
consider, among other relevant economic
factors--
``(I) any existing unused production
capacity or imminent, substantial
increase in production capacity in the
exporting country indicating the
likelihood of substantially increased
sales of a foreign like vessel to
United States buyers, taking into
account the availability of other
export markets to absorb any additional
exports,
``(II) whether the sale of a foreign
like vessel or other factors indicate
the likelihood of significant
additional sales to United States
buyers,
``(III) whether sale of the subject
vessel or sale of a foreign like vessel
by the foreign producer are at prices
that are likely to have a significant
depressing or suppressing effect on
domestic prices, and are likely to
increase demand for further sales,
``(IV) the potential for product-
shifting if production facilities in
the exporting country, which can
presently be used to produce a foreign
like vessel or could be adapted in a
timely manner to produce a foreign like
vessel, are currently being used to
produce other types of vessels,
``(V) the actual and potential
negative effects on the existing
development and production efforts of
the domestic industry, including
efforts to develop a derivative or more
advanced version of a domestic like
vessel, and
``(VI) any other demonstrable adverse
trends that indicate the probability
that there is likely to be material
injury by reason of the sale of the
subject vessel.
``(ii) Basis for determination.--The
Commission shall consider the factors set forth
in clause (i) as a whole. The presence or
absence of any factor which the Commission is
required to consider under clause (i) shall not
necessarily give decisive guidance with respect
to the determination. Such a determination may
not be made on the basis of mere conjecture or
supposition.
``(iii) Effect of injurious pricing in third-
country markets.--
``(I) In general.--The Commission
shall consider whether injurious
pricing in the markets of foreign
countries (as evidenced by injurious
pricing findings or injurious pricing
remedies of other Shipbuilding
Agreement Parties, or antidumping
determinations of, or measures imposed
by, other countries, against a like
vessel produced by the producer under
investigation) suggests a threat of
material injury to the domestic
industry. In the course of its
investigation, the Commission shall
request information from the foreign
producer or United States buyer
concerning this issue.
``(II) European communities.--For
purposes of this clause, the European
Communities as a whole shall be treated
as a single foreign country.
``(F) Cumulation for determining material injury.--
``(i) In general.--For purposes of clauses
(i) and (ii) of subparagraph (C), and subject
to clause (ii) of this subparagraph, the
Commission shall cumulatively assess the
effects of sales of foreign like vessels from
all foreign producers with respect to which--
``(I) petitions were filed under
section 802(b) on the same day,
``(II) investigations were initiated
under section 802(a) on the same day,
or
``(III) petitions were filed under
section 802(b) and investigations were
initiated under section 802(a) on the
same day,
if, with respect to such vessels, the foreign
producers compete with each other and with
producers of a domestic like vessel in the
United States market.
``(ii) Exceptions.--The Commission shall not
cumulatively assess the effects of sales under
clause (i)--
``(I) with respect to which the
administering authority has made a
preliminary negative determination,
unless the administering authority
subsequently made a final affirmative
determination with respect to those
sales before the Commission's final
determination is made, or
``(II) from any producer with respect
to which the investigation has been
terminated.
``(iii) Records in final investigations.--In
each final determination in which it
cumulatively assesses the effects of sales
under clause (i), the Commission may make its
determinations based on the record compiled in
the first investigation in which it makes a
final determination, except that when the
administering authority issues its final
determination in a subsequently completed
investigation, the Commission shall permit the
parties in the subsequent investigation to
submit comments concerning the significance of
the administering authority's final
determination, and shall include such comments
and the administering authority's final
determination in the record for the subsequent
investigation.
``(G) Cumulation for determining threat of material
injury.--To the extent practicable and subject to
subparagraph (F)(ii), for purposes of clause (i) (II)
and (III) of subparagraph (E), the Commission may
cumulatively assess the effects of sales of like
vessels from all countries with respect to which--
``(i) petitions were filed under section
802(b) on the same day,
``(ii) investigations were initiated under
section 802(a) on the same day, or
``(iii) petitions were filed under section
802(b) and investigations were initiated under
section 802(a) on the same day,
if, with respect to such vessels, the foreign producers
compete with each other and with producers of a
domestic like vessel in the United States market.
``(17) Interested party.--The term `interested party' means,
in a proceeding under this title--
``(A)(i) the foreign producer, seller (other than the
foreign producer), and the United States buyer of the
subject vessel, or
``(ii) a trade or business association a majority of
the members of which are the foreign producer, seller,
or United States buyer of the subject vessel,
``(B) the government of the country in which the
subject vessel is produced or manufactured,
``(C) a producer that is a member of an industry,
``(D) a certified union or recognized union or group
of workers which is representative of an industry,
``(E) a trade or business association a majority of
whose members are producers in an industry,
``(F) an association, a majority of whose members is
composed of interested parties described in
subparagraph (C), (D), or (E), and
``(G) for purposes of section 807, a purchaser who,
after the effective date of an order issued under that
section, entered into a contract of sale with the
foreign producer that is subject to the order.
``(18) Affirmative determinations by divided commission.--If
the Commissioners voting on a determination by the Commission
are evenly divided as to whether the determination should be
affirmative or negative, the Commission shall be deemed to have
made an affirmative determination. For the purpose of applying
this paragraph when the issue before the Commission is to
determine whether there is or has been--
``(A) material injury to an industry in the United
States,
``(B) threat of material injury to such an industry,
or
``(C) material retardation of the establishment of an
industry in the United States,
by reason of the sale of the subject vessel, an affirmative
vote on any of the issues shall be treated as a vote that the
determination should be affirmative.
``(19) Ordinary course of trade.--The term `ordinary course
of trade' means the conditions and practices which, for a
reasonable time before the sale of the subject vessel, have
been normal in the shipbuilding industry with respect to a like
vessel. The administering authority shall consider the
following sales and transactions, among others, to be outside
the ordinary course of trade:
``(A) Sales disregarded under section 822(b)(1).
``(B) Transactions disregarded under section
822(f)(2).
``(20) Nonmarket economy country.--
``(A) In general.--The term `nonmarket economy
country' means any foreign country that the
administering authority determines does not operate on
market principles of cost or pricing structures, so
that sales of vessels in such country do not reflect
the fair value of the vessels.
``(B) Factors to be considered.--In making
determinations under subparagraph (A) the administering
authority shall take into account--
``(i) the extent to which the currency of the
foreign country is convertible into the
currency of other countries,
``(ii) the extent to which wage rates in the
foreign country are determined by free
bargaining between labor and management,
``(iii) the extent to which joint ventures or
other investments by firms of other foreign
countries are permitted in the foreign country,
``(iv) the extent of government ownership or
control of the means of production,
``(v) the extent of government control over
the allocation of resources and over the price
and output decisions of enterprises, and
``(vi) such other factors as the
administering authority considers appropriate.
``(C) Determination in effect.--
``(i) Any determination that a foreign
country is a nonmarket economy country shall
remain in effect until revoked by the
administering authority.
``(ii) The administering authority may make a
determination under subparagraph (A) with
respect to any foreign country at any time.
``(D) Determinations not in issue.--Notwithstanding
any other provision of law, any determination made by
the administering authority under subparagraph (A)
shall not be subject to judicial review in any
investigation conducted under subtitle A.
``(21) Shipbuilding agreement.--The term `Shipbuilding
Agreement' means The Agreement Respecting Normal Competitive
Conditions in the Commercial Shipbuilding and Repair Industry,
resulting from negotiations under the auspices of the
Organization for Economic Cooperation and Development, and
entered into on December 21, 1994.
``(22) Shipbuilding agreement party.--The term `Shipbuilding
Agreement Party' means a state or separate customs territory
that is a Party to the Shipbuilding Agreement, and with respect
to which the United States applies the Shipbuilding Agreement.
``(23) WTO agreement.--The term `WTO Agreement' means the
Agreement defined in section 2(9) of the Uruguay Round
Agreements Act.
``(24) WTO member.--The term `WTO member' means a state, or
separate customs territory (within the meaning of Article XII
of the WTO Agreement), with respect to which the United States
applies the WTO Agreement.
``(25) Trade representative.--The term `Trade Representative'
means the United States Trade Representative.
``(26) Affiliated persons.--The following persons shall be
considered to be `affiliated' or `affiliated persons':
``(A) Members of a family, including brothers and
sisters (whether by the whole or half blood), spouse,
ancestors, and lineal descendants.
``(B) Any officer or director of an organization and
such organization.
``(C) Partners.
``(D) Employer and employee.
``(E) Any person directly or indirectly owning,
controlling, or holding with power to vote, 5 percent
or more of the outstanding voting stock or shares of
any organization, and such organization.
``(F) Two or more persons directly or indirectly
controlling, controlled by, or under common control
with, any person.
``(G) Any person who controls any other person, and
such other person.
For purposes of this paragraph, a person shall be considered to
control another person if the person is legally or
operationally in a position to exercise restraint or direction
over the other person.
``(27) Injurious pricing.--The term `injurious pricing'
refers to the sale of a vessel at less than fair value.
``(28) Injurious pricing margin.--
``(A) In general.--The term `injurious pricing
margin' means the amount by which the normal value
exceeds the export price of the subject vessel.
``(B) Magnitude of the injurious pricing margin.--The
magnitude of the injurious pricing margin used by the
Commission shall be--
``(i) in making a preliminary determination
under section 803(a) in an investigation
(including any investigation in which the
Commission cumulatively assesses the effect of
sales under paragraph (16)(F)(i)), the
injurious pricing margin or margins published
by the administering authority in its notice of
initiation of the investigation; and
``(ii) in making a final determination under
section 805(b), the injurious pricing margin or
margins most recently published by the
administering authority before the closing of
the Commission's administrative record.
``(29) Commercial interest reference rate.--The term
`Commercial Interest Reference Rate' or `CIRR' means an
interest rate that the administering authority determines to be
consistent with Annex III, and appendices and notes thereto, of
the Understanding on Export Credits for Ships, resulting from
negotiations under the auspices of the Organization for
Economic Cooperation, and entered into on December 21, 1994.
``(30) Antidumping.--
``(A) WTO members.--In the case of a WTO member, the
term `antidumping' refers to action taken pursuant to
the Agreement on Implementation of Article VI of the
General Agreement on Tariffs and Trade 1994.
``(B) Other cases.--In the case of any country that
is not a WTO member, the term `antidumping' refers to
action taken by the country against the sale of a
vessel at less than fair value that is comparable to
action described in subparagraph (A).
``(31) Broad multiple bid.--The term `broad multiple bid'
means a bid in which the proposed buyer extends an invitation
to at least all the producers in the industry known by the
buyer to be capable of building the subject vessel.''.
SEC. 102. ENFORCEMENT OF COUNTERMEASURES.
Part II of title IV of the Tariff Act of 1930 is amended by adding at
the end the following:
``SEC. 468. SHIPBUILDING AGREEMENT COUNTERMEASURES.
``(a) In General.--Notwithstanding any other provision of law, upon
receiving from the Secretary of Commerce a list of vessels subject to
countermeasures under section 807, the Customs Service shall deny any
request for a permit to lade or unlade passengers, merchandise, or
baggage from or onto those vessels so listed.
``(b) Exceptions.--Subsection (a) shall not be applied to deny a
permit for the following:
``(1) To unlade any United States citizen or permanent legal
resident alien from a vessel included in the list described in
subsection (a), or to unlade any refugee or any alien who would
otherwise be eligible to apply for asylum and withholding of
deportation under the Immigration and Nationality Act.
``(2) To lade or unlade any crewmember of such vessel.
``(3) To lade or unlade coal and other fuel supplies (for the
operation of the listed vessel), ships' stores, sea stores, and
the legitimate equipment of such vessel.
``(4) To lade or unlade supplies for the use or sale on such
vessel.
``(5) To lade or unlade such other merchandise, baggage, or
passenger as the Customs Service shall determine necessary to
protect the immediate health, safety, or welfare of a human
being.
``(c) Correction of Ministerial or Clerical Errors.--
``(1) Petition for correction.--If the master of any vessel
whose application for a permit to lade or unlade has been
denied under this section believes that such denial resulted
from a ministerial or clerical error, not amounting to a
mistake of law, committed by any Customs officer, the master
may petition the Customs Service for correction of such error,
as provided by regulation.
``(2) Inapplicability of sections 514 and 520.--
Notwithstanding paragraph (1), imposition of countermeasures
under this section shall not be deemed an exclusion or other
protestable decision under section 514, and shall not be
subject to correction under section 520.
``(3) Petitions seeking administrative review.--Any petition
seeking administrative review of any matter regarding the
Secretary of Commerce's decision to list a vessel under section
807 must be brought under that section.
``(d) Penalties.--In addition to any other provision of law, the
Customs Service may impose a civil penalty of not to exceed $10,000
against the master of any vessel--
``(1) who submits false information in requesting any permit
to lade or unlade; or
``(2) who attempts to, or actually does, lade or unlade in
violation of any denial of such permit under this section.''.
SEC. 103. JUDICIAL REVIEW IN INJURIOUS PRICING AND COUNTERMEASURE
PROCEEDINGS.
(a) Judicial Review.--Part III of title IV of the Tariff Act of 1930
is amended by inserting after section 516A the following:
``SEC. 516B. JUDICIAL REVIEW IN INJURIOUS PRICING AND COUNTERMEASURE
PROCEEDINGS.
``(a) Review of Determination.--
``(1) In general.--Within 30 days after the date of
publication in the Federal Register of--
``(A)(i) a determination by the administering
authority under section 802(c) not to initiate an
investigation,
``(ii) a negative determination by the Commission
under section 803(a) as to whether there is or has been
reasonable indication of material injury, threat of
material injury, or material retardation,
``(iii) a determination by the administering
authority to suspend or revoke an injurious pricing
order under section 806(d) or (e),
``(iv) a determination by the administering authority
under section 807(c),
``(v) a determination by the administering authority
in a review under section 807(d),
``(vi) a determination by the administering authority
concerning whether to extend the scope or duration of a
countermeasure order under section 807(e)(3)(B)(ii),
``(vii) a determination by the administering
authority to amend a countermeasure order under section
807(e)(6),
``(viii) a determination by the administering
authority in a review under section 807(g),
``(ix) a determination by the administering authority
under section 807(i) to terminate proceedings, or to
amend or revoke a countermeasure order,
``(x) a determination by the administering authority
under section 845(b), with respect to a matter
described in paragraph (1)(D) of that section, or
``(B)(i) an injurious pricing order based on a
determination described in subparagraph (A) of
paragraph (2),
``(ii) notice of a determination described in
subparagraph (B) of paragraph (2),
``(iii) notice of implementation of a determination
described in subparagraph (C) of paragraph (2), or
``(iv) notice of revocation of an injurious pricing
order based on a determination described in
subparagraph (D) of paragraph (2),
an interested party who is a party to the proceeding in
connection with which the matter arises may commence an action
in the United States Court of International Trade by filing
concurrently a summons and complaint, each with the content and
in the form, manner, and style prescribed by the rules of that
court, contesting any factual findings or legal conclusions
upon which the determination is based.
``(2) Reviewable determinations.--The determinations referred
to in paragraph (1)(B) are--
``(A) a final affirmative determination by the
administering authority or by the Commission under
section 805, including any negative part of such a
determination (other than a part referred to in
subparagraph (B)),
``(B) a final negative determination by the
administering authority or the Commission under section
805,
``(C) a determination by the administering authority
under section 845(b), with respect to a matter
described in paragraph (1)(A) of that section, and
``(D) a determination by the Commission under section
845(a) that results in the revocation of an injurious
pricing order.
``(3) Exception.--Notwithstanding the 30-day limitation
imposed by paragraph (1) with regard to an order described in
paragraph (1)(B)(i), a final affirmative determination by the
administering authority under section 805 may be contested by
commencing an action, in accordance with the provisions of
paragraph (1), within 30 days after the date of publication in
the Federal Register of a final negative determination by the
Commission under section 805.
``(4) Procedures and fees.--The procedures and fees set forth
in chapter 169 of title 28, United States Code, apply to an
action under this section.
``(b) Standards of Review.--
``(1) Remedy.--The court shall hold unlawful any
determination, finding, or conclusion found--
``(A) in an action brought under subparagraph (A) of
subsection (a)(1), to be arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance
with law, or
``(B) in an action brought under subparagraph (B) of
subsection (a)(1), to be unsupported by substantial
evidence on the record, or otherwise not in accordance
with law.
``(2) Record for review.--
``(A) In general.--For purposes of this subsection,
the record, unless otherwise stipulated by the parties,
shall consist of--
``(i) a copy of all information presented to
or obtained by the administering authority or
the Commission during the course of the
administrative proceeding, including all
governmental memoranda pertaining to the case
and the record of ex parte meetings required to
be kept by section 843(a)(2); and
``(ii) a copy of the determination, all
transcripts or records of conferences or
hearings, and all notices published in the
Federal Register.
``(B) Confidential or privileged material.--The
confidential or privileged status accorded to any
documents, comments, or information shall be preserved
in any action under this section. Notwithstanding the
preceding sentence, the court may examine, in camera,
the confidential or privileged material, and may
disclose such material under such terms and conditions
as it may order.
``(c) Standing.--Any interested party who was a party to the
proceeding under title VIII shall have the right to appear and be heard
as a party in interest before the United States Court of International
Trade in an action under this section. The party filing the action
shall notify all such interested parties of the filing of an action
under this section, in the form, manner, and within the time prescribed
by rules of the court.
``(d) Definitions.--For purposes of this section:
``(1) Administering authority.--The term `administering
authority' has the meaning given that term in section 861(1).
``(2) Commission.--The term `Commission' means the United
States International Trade Commission.
``(3) Interested party.--The term `interested party' means
any person described in section 861(17).''.
(b) Conforming Amendments.--
(1) Jurisdiction of the court.--Section 1581(c) of title 28,
United States Code, is amended by inserting ``or 516B'' after
``section 516A''.
(2) Relief.--Section 2643 of title 28, United States Code, is
amended--
(A) in subsection (c)(1) by striking ``and (5)'' and
inserting ``(5), and (6)''; and
(B) in subsection (c) by adding at the end the
following new paragraph:
``(6) In any civil action under section 516B of the Tariff Act of
1930, the Court of International Trade may not issue injunctions or any
other form of equitable relief, except with regard to implementation of
a countermeasure order under section 468 of that Act, upon a proper
showing that such relief is warranted.''.
TITLE II--OTHER PROVISIONS
SEC. 201. EQUIPMENT AND REPAIR OF VESSELS.
Section 466 of the Tariff Act of 1930 (19 U.S.C. 1466), is amended by
adding at the end the following new subsection:
``(i) The duty imposed by subsection (a) shall not apply with respect
to activities occurring in a Shipbuilding Agreement Party, as defined
in section 861(22), with respect to--
``(1) self-propelled seagoing vessels of 100 gross tons or
more that are used for transportation of goods or persons or
for performance of a specialized service (including, but not
limited to, ice breakers and dredges), and
``(2) tugs of 365 kilowatts or more.
A vessel shall be considered `self-propelled seagoing' if its permanent
propulsion and steering provide it all the characteristics of self-
navigability in the high seas.''.
SEC. 202. 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
Shipbuilding Agreement or by virtue of congressional approval
of the agreement, 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, the District of
Columbia, any State, any political subdivision of a State, or
any territory or possession of the United States on the ground
that such action or inaction is inconsistent with such
agreement.
SEC. 203. IMPLEMENTING REGULATIONS.
After the date of the enactment of this Act, the heads of agencies
with functions under this Act and the amendments made by this Act may
issue such regulations as may be necessary to ensure that this Act is
appropriately implemented on the date the Shipbuilding Agreement enters
into force with respect to the United States.
SEC. 204. AMENDMENTS TO THE MERCHANT MARINE ACT, 1936.
The Merchant Marine Act, 1936, is amended as follows:
(1) Section 511(a)(2) (46 App. U.S.C. 1161(a)(2)) is amended
by inserting after ``1939,'' the following: ``or, if the vessel
is a Shipbuilding Agreement vessel, constructed in a
Shipbuilding Agreement Party, but only with regard to moneys
deposited, on or after the date on which the Shipbuilding Trade
Agreement Act takes effect, into a construction reserve fund
established under subsection (b)''.
(2) Section 601(a) (46 App. U.S.C. 1171(a)) is amended by
striking ``, and that such vessel or vessels were built in the
United States, or have been documented under the laws of the
United States not later than February 1, 1928, or actually
ordered and under construction for the account of citizens of
the United States prior to such date'' and inserting ``and that
such vessel or vessels were built in the United States, or, if
the vessel or vessels are Shipbuilding Agreement vessels, in a
Shipbuilding Agreement Party''.
(3) Section 606(6) (46 App. U.S.C. 1176(6)) is amended by
inserting ``or, if the vessel is a Shipbuilding Agreement
vessel, in a Shipbuilding Agreement Party or in the United
States'' before ``, except in an emergency.''.
(4) Section 607 (46 App. U.S.C. 1177) is amended as follows:
(A) Subsection (a) is amended by inserting ``or, if
the vessel is a Shipbuilding Agreement vessel, in a
Shipbuilding Agreement Party,'' after ``built in the
United States''.
(B) Subsection (k) is amended as follows:
(i) Paragraph (1) is amended by striking
subparagraph (A) and inserting the following:
``(A)(i) constructed in the United States and, if
reconstructed, reconstructed in the United States or in a
Shipbuilding Agreement Party, or
``(ii) that is a Shipbuilding Agreement vessel and is
constructed in a Shipbuilding Agreement Party and, if
reconstructed, is reconstructed in a Shipbuilding Agreement
Party or in the United States,''.
(ii) Paragraph (2)(A) is amended to read as
follows:
``(A)(i) constructed in the United States and, if
reconstructed, reconstructed in the United States or in a
Shipbuilding Agreement Party, or
``(ii) that is a Shipbuilding Agreement vessel and is
constructed in a Shipbuilding Agreement Party and, if
reconstructed, is reconstructed in a Shipbuilding Agreement
Party or in the United States, but only with regard to moneys
deposited into the fund on or after the date on which the
Shipbuilding Trade Agreement Act takes effect,''.
(5) Section 610 (46 App. U.S.C. 1180) is amended by striking
``shall be built in a domestic yard or shall have been
documented under the laws of the United States not later than
February 1, 1928, or actually ordered and under construction
for the account of citizens of the United States prior to such
date,'' and inserting ``shall be built in the United States or,
if the vessel is a Shipbuilding Agreement vessel, in a
Shipbuilding Agreement Party,''.
(6) Section 901(b)(1) (46 App. U.S.C. 1241(b)(1)) is amended
by striking the third sentence and inserting the following:
``For purposes of this section, the term `privately owned United
States-flag commercial vessels' shall be deemed to include--
``(A) any privately owned United States-flag commercial
vessel constructed in the United States, and if rebuilt,
rebuilt in the United States or in a Shipbuilding Agreement
Party on or after the date on which the Shipbuilding Trade
Agreement Act takes effect, and
``(B) any privately owned vessel constructed in a
Shipbuilding Agreement Party on or after the date on which the
Shipbuilding Trade Agreement Act takes effect, and if rebuilt,
rebuilt in a Shipbuilding Agreement Party or in the United
States, that is documented pursuant to chapter 121 of title 46,
United States Code.
The term `privately owned United States-flag commercial vessels' shall
also be deemed to include any cargo vessel that so qualified pursuant
to section 615 of this Act or this paragraph before the date on which
the Shipbuilding Trade Agreement Act takes effect. The term `privately
owned United States-flag commercial vessels' shall not be deemed to
include any liquid bulk cargo vessel that does not meet the
requirements of section 3703a of title 46, United States Code.''.
(7) Section 905 (46 App. U.S.C. 1244) is amended by adding at
the end the following:
``(h) The term `Shipbuilding Agreement' means the Agreement
Respecting Normal Competitive Conditions in the Commercial Shipbuilding
and Repair Industry, which resulted from negotiations under the
auspices of the Organization for Economic Cooperation and Development,
and was entered into on December 21, 1994.
``(i) The term `Shipbuilding Agreement Party' means a state or
separate customs territory that is a Party to the Shipbuilding
Agreement, and with respect to which the United States applies the
Shipbuilding Agreement.
``(j) The term `Shipbuilding Agreement vessel' means a vessel to
which the Secretary determines Article 2.1 of the Shipbuilding
Agreement applies.
``(k) The term `Export Credit Understanding' means the Understanding
on Export Credits for Ships which resulted from negotiations under the
auspices of the Organization for Economic Cooperation and Development
and was entered into on December 21, 1994.
``(l) The term `Export Credit Understanding vessel' means a vessel to
which the Secretary determines the Export Credit Understanding
applies.''.
(8) Section 1104A (46 App. U.S.C. 1274) is amended as
follows:
(A) Paragraph (5) of subsection (b) is amended to
read as follows:
``(5) shall bear interest (exclusive of charges for the
guarantee and service charges, if any) at rates not to exceed
such percent per annum on the unpaid principal as the Secretary
determines to be reasonable, taking into account the range of
interest rates prevailing in the private market for similar
loans and the risks assumed by the Secretary, except that, with
respect to Export Credit Understanding vessels, and
Shipbuilding Agreement vessels, the obligations shall bear
interest at a rate the Secretary determines to be consistent
with obligations of the United States under the Export Credit
Understanding or the Shipbuilding Agreement, as the case may
be;''.
(B) Subsection (i) is amended to read as follows:
``(i)(1) Except as provided in paragraph (2), the Secretary may not,
with respect to--
``(A) the general 75 percent or less limitation contained in
subsection (b)(2),
``(B) the 87\1/2\ percent or less limitation contained in the
1st, 2nd, 4th, or 5th proviso to subsection (b)(2) or in
section 1112(b), or
``(C) the 80 percent or less limitation in the 3rd proviso to
such subsection,
establish by rule, regulation, or procedure any percentage within any
such limitation that is, or is intended to be, applied uniformly to all
guarantees or commitments to guarantee made under this section that are
subject to the limitation.
``(2) With respect to Export Credit Understanding vessels and
Shipbuilding Agreement vessels, the Secretary may establish by rule,
regulation, or procedure a uniform percentage that the Secretary
determines to be consistent with obligations of the United States under
the Export Credit Understanding or the Shipbuilding Agreement, as the
case may be.''.
(C) Section 1104B(b) (46 App. U.S.C. 1274a(b)) is
amended by striking the period at the end and inserting
the following:
``, except that, with respect to Export Credit Understanding vessels
and Shipbuilding Agreement vessels, the Secretary may establish by
rule, regulation, or procedure a uniform percentage that the Secretary
determines to be consistent with obligations of the United States under
the Export Credit Understanding or the Shipbuilding Agreement, as the
case may be.''.
TITLE III--REVENUE OFFSET
SEC. 301. PENALTIES FOR FAILURE TO DISCLOSE POSITION THAT CERTAIN
INTERNATIONAL SHIPPING INCOME IS NOT INCLUDIBLE IN
GROSS INCOME.
(a) In General.--Section 883 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subsection:
``(d) Penalties for Failure to Disclose Position That Certain
International Shipping Income Is Not Includible in Gross Income.--
``(1) In general.--A taxpayer who, with respect to any tax
imposed by this title, takes the position that any of its gross
income derived from the international operation of a ship or
ships is not includible in gross income by reason of subsection
(a)(1) or section 872(b)(1) shall be entitled to such treatment
only if such position is disclosed (in such manner as the
Secretary may prescribe) on the return of tax for such tax (or
any statement attached to such return).
``(2) Additional penalties for failing to disclose
position.--If a taxpayer fails to meet the requirement of
paragraph (1) with respect to any taxable year--
``(A) the amount of the income from the international
operation of a ship or ships--
``(i) which is from sources without the
United States, and
``(ii) which is attributable to a fixed place
of business in the United States,
shall be treated for purposes of this title as
effectively connected with the conduct of a trade or
business within the United States, and
``(B) no deductions or credits shall be allowed which
are attributable to income from the international
operation of a ship or ships.
``(3) Reasonable cause exception.--This subsection shall not
apply to a failure to disclose a position if it is shown that
such failure is due to reasonable cause and not due to willful
neglect.''
(b) Conforming Amendments.--
(1) Paragraph (1) of section 872(b) of such Code is amended
by striking ``Gross income'' and inserting ``Except as provided
in section 883(d), gross income''.
(2) Paragraph (1) of section 883(a) of such Code is amended
by striking ``Gross income'' and inserting ``Except as provided
in subsection (d), gross income''.
(c) Effective Date.--
(1) In general.--Notwithstanding section 3, the amendments
made by this section shall apply to taxable years beginning
after the later of--
(A) December 31, 1996, or
(B) the date that the Shipbuilding Agreement enters
into force with respect to the United States.
(2) Coordination with treaties.--The amendments made by this
section shall not apply in any case where their application
would be contrary to any treaty obligation of the United
States.
(d) Information To Be Provided by Customs Service.--The United States
Custom Service shall provide the Secretary of the Treasury or his
delegate with such information as may be specified by such Secretary in
order to enable such Secretary to determine whether ships which are not
registered in the United States are engaged in transportation to or
from the United States.
I. INTRODUCTION
A. Purposes and Summary
H.R. 2754, as amended by the Committee, entitled the
Shipbuilding Trade Agreement Act, implements the Organization
for Economic Cooperation and Development (OECD) Agreement on
Shipbuilding.
H.R. 2754, as amended, would implement the Agreement under
U.S. law. Specifically, the bill would establish an injurious
pricing mechanism analogous to Title VII of the Tariff Act of
1930, which implements the antidumping provisions of the
Uruguay Round. In addition, the bill would eliminate the
current 50 percent duty on repairs to U.S. flag vessels made in
signatory countries. The bill would also amend the Merchant
Marine Act of 1936 to assure U.S. compliance with the
Agreement. Finally, the bill would establishes penalties for
failure to file a disclosure of exemption for shipping income
of foreign persons.
B. Background and Need for Legislation
After five years of negotiation, key shipbuilding nations
(the United States, the European Union, Japan, South Korea, and
Norway) completed negotiations and signed on December 21, 1994,
the Agreement Respecting Normal Competitive Conditions in the
Commercial Shipbuilding and Repair Industry. The Agreement,
negotiated under the auspices of the OECD, applies to the
construction and repair of self-propelled seagoing vessels of
100 gross tons and above, and covers approximately 80 percent
of world shipbuilding capacity for ships engaged in global
shipping. The Agreement is scheduled to enter into force 30
days after all signatories deposit instruments of ratification,
acceptance, or approval. The target date for entry into force
is July 15, 1996. In the United States, legislation must be
enacted by Congress to bring U.S. law into compliance with the
Agreement.
The Agreement eliminates virtually all shipbuilding
subsidies granted either directly to shipbuilders or indirectly
through ship operators or other entities. In addition, it
contains an injurious pricing code to prevent dumping in the
shipbuilding industry, a comprehensive discipline in government
financing for exports and domestic ship sales, and a dispute
settlement mechanism.
C. Legislative History
H.R. 2754 was introduced on December 11, 1995, by Chairman
Philip M. Crane, Congressman Sam Gibbons and Congresswoman
Jennifer Dunn. The bill was referred to the Committee on Ways
and Means, and in addition to the Committee on National
Security.
On March 21, 1996, the Committee on Ways and Means met to
consider H.R. 2754. At that time, Chairman Archer, for himself,
Chairman Crane, Mr. Gibbons, and Ms. Dunn, offered an amendment
in the nature of a substitute to H.R. 2374. The amendment was
agreed to by voice vote. The Committee then ordered the bill
favorable voted, as amended, by a roll-call vote of 27 to 4.
II. EXPLANATION OF PROVISIONS
A. Sections 1-3
Explanation of provisions
Section 1 provides that the short title of the bill is the
Shipbuilding Trade Agreement Act. Section 2 provides that
Congress approves the OECD Agreement on Shipbuilding. Section 3
provides that the Act would take effect on the date that the
Shipbuilding Agreement enters into force with respect to the
United States. The Agreement is scheduled to enter into force
30 days after all signatories deposit instruments of
ratification, acceptance, or approval. The target date for
entry into force is July 15, 1996.
B. Title 1: Injurious Pricing And Countermeasures
1. SECTION 101: INJURIOUS PRICING AND COUNTER-MEASURES PROCEEDINGS
a. In General
Present law
There are no provisions under current law that permit the
collection of an injurious pricing charge and the assessment of
countermeasures against ships sold to U.S. buyers at dumped
prices in a manner that injures the U.S. shipbuilding industry.
All references to present law in this report with respect to
antidumping refer to Title VII of the Tariff Act of 1930, as
amended, which sets forth procedures for assessment of
antidumping duties according to the antidumping remedy of the
World Trade Organization.
Explanation of provision
Title I of H.R. 2754, as amended, would establish a new
Title VIII to the Tariff Act of 1930, as amended, in order to
create an injurious pricing mechanism applicable to
shipbuilding. Title VIII would be analogous to the current
antidumping provisions of Title VII of the Tariff Act of 1930,
as amended, revised only where necessary to take into account
differences between the Shipbuilding Agreement and the WTO
antidumping agreement and differences due to the unique nature
of ocean-going vessels. Accordingly, only the differences
between Title VII and the new Title VIII are outlined below in
this report.
Reason for change
The Shipbuilding Agreement establishes a mechanism for the
determination of injurious pricing in a manner analogous to the
antidumping provisions of the World Trade Organization. In
addition, the Agreement provides for the assessment of an
injurious pricing charge and countermeasures where
appropriate--remedies that are different from those of Title
VII. Because ocean-going vessels engaged in international trade
are technically not imported or entered for consumption in the
United States, it is virtually impossible to use the
antidumping remedies of Title VII of the Tariff Act of 1930, as
amended, to cover vessels. Accordingly, separate statutory
authority is required to implement the Agreement.
b. Section 801 of New Title VIII: Injurious Pricing Charge
Present law: Title VII
Section 731 of Title VII provides that antidumping duties
shall be assessed against imports of a class or kind of
merchandise if the Department of Commerce determines that the
merchandise is being, or is likely to be, sold in the United
States at less than its fair value and the International Trade
Commission (ITC) determines that an industry in the United
States is materially injured or is threatened with material
injury or the establishment of an industry in the United States
is materially retarded by reason of imports of that
merchandise. The amount of the antidumping duty would be the
amount by which normal value exceeds the export price. The duty
is generally to be applied to entries made after the Commerce
Department makes its preliminary determination.
Explanation of provision
Section 801 would require the imposition of a one-time
injurious pricing charge against the foreign shipbuilder if
Commerce determines that a vessel produced by that shipbuilder
has been sold directly or indirectly to a U.S. buyer at less
than its fair value and the ITC determines that an industry in
the United States is or has been materially injured or
threatened with material injury or the establishment of an
industry in the United States is or has been materially
retarded by reason of the sale of that vessel. The amount of
the injurious pricing charge is to be the amount by which
normal value exceeds the export price. The injurious pricing
charge would be assessed once, for the sale in question. Once
the charge is paid, there would be no continuing liability on
future sales or scrutiny of sales of other vessels unless a
separate investigation is conducted for such sales.
Reason for difference
Although the antidumping statute has been used as a model
for Title VIII, several changes are required to take into
account the unique nature of ships and the requirements of the
Shipbuilding Agreement. Specifically, because ocean-going
vessels engaged in international trade are technically not
imported or entered for consumption in the United States, the
Agreement and the implementing bill would permit investigations
to be commenced when a vessel is sold directly or indirectly to
a U.S buyer, regardless of whether the vessel enters the United
States.
For the same reason, the traditional antidumping mechanism
of imposing an antidumping duty on future entries would not
provide the domestic industry with sufficient relief.
Accordingly, the Agreement and the implementing bill would
establish a one-time injurious pricing charge to be assessed
against the shipyard producing the injuriously priced vessel.
Finally, because the determination of injurious pricing is
focused on the sale under investigation and not subsequent
sales, the injury investigation (except with regard to threat
of material injury) would be necessarily retrospective.
However, in a Title VII case, the ITC determines whether the
domestic industry is materially injured or threatened with
material injury (i.e., whether the industry is in a state of
present material injury by reason of subject imports). In
making this determination, the ITC may not rely on the
lingering effects of an injury experienced in the past or a
determination that the effects of a previous injury are
presently being felt. Instead, the ITC must determine whether
the subject imports are causing present injury to the domestic
industry at the time of its determination. By contrast, the
Shipbuilding Agreement and implementing bill, in a recognition
of the retrospective nature of injurious pricing investigations
in the shipbuilding context, would permit consideration of
whether an industry is or has been injured. Accordingly, the
Committee intends that the material injury standards of Title
VII and Title VIII be interpreted differently. However, even
under Title VIII, the Committee intends that in order to reach
an affirmative determination, the ITC must find that injury has
been by reason of the vessel under investigation.
c. Section 802 of New Title VIII: Procedures for Instituting an
Injurious Pricing Investigation
Present law: Title VII
Section 735 does not provide for a time period after a
dumped sale within which a petition must be filed or an
investigation self-initiated by Commerce. However, in order to
obtain relief, dumping and injury must have occurred during the
agencies' period of investigation (POI). Commerce generally
investigates entries during the twelve months prior to the
filing of the petition, and the ITC's POI is generally the last
three full years, plus any interim period of the current year.
If dumped sales did not occur during that period, it would be
difficult for a petitioner to prevail.
Section 771(9)(A) states that if a petitioner is an
interested party entitled to bring a petition because it is a
producer of a domestic like product, it must (except in the
case of material retardation) in fact be a producer of a
domestic like product. However, it is not required to show that
it made an effort to sell like merchandise to the purchaser.
Section 732(c)(4) sets forth the standing requirements for
petitioners. A petitioner must file ``on behalf of'' the
industry, and the nature of the support for the petition is
specified as follows:
domestic producers or workers who support the
petition must account for at least 25 percent of total
production of the domestic like product; and
domestic producers or workers who support the
petition must account for more than 50 percent of
production of the domestic like product produced by
that portion of the industry expressing views.
Section 732(c)(1) provides a 20-day deadline for initiating
an investigation after the filing of a petition, assuming that
the petition meets the requirements. This deadline may be
extended to 40 days if Commerce needs additional time to
determine industry support for the petition.
Title VII does not provide for the delay or termination of
an investigation if another WTO party is taking action against
like merchandise from the subject country.
Explanation of provision
Section 802 sets forth the procedures for conducting an
injurious pricing investigation. Section 802(a) describes
procedures for initiation by the Commerce and provides that an
investigation may only be self-initiated within six months
after the time that Commerce first knew or should have known of
the sale of the vessel. Section 802(b) describes the procedures
for initiation by petition, requiring that a petition be filed
within either six or nine months (depending on circumstances)
from the time the petitioner knew or should have known of the
sale of the vessel, but no later than six months after the
delivery of the vessel. If these deadlines are not met, an
investigation may not go forward.
Section 802(b)(1) provides that if a petitioner is a
producer, it must show that it had the capability to produce
the subject vessel. In addition, if the sale was made through a
bidding process that was either a broad multiple bid or to
which the producer was invited to bid, the petitioner must show
that it made a timely effort to obtain the sale through a
proposal that met bid specifications. If the sale was not made
through a broad multiple bid and the petitioner was not invited
to bid but knew or should have known of the proposed purchase,
the petitioner must show it made timely efforts to conclude a
sale consistent with the buyer's requirements.
Section 802(d)(1) provides a 45-day deadline, with no
extension, for initiating an investigation after the filing of
a petition, assuming that the petition meets the requirements
set forth. Section 802(d)(4) sets forth the standing
requirements for petitioners. A petitioner must file ``on
behalf of'' the industry, and the nature of the support for the
petition is specified as follows:
domestic producers or workers who support the
petition must account for at least 25 percent of the
total capacity of domestic producers capable of
producing the like vessel; and
domestic producers or workers who support the
petition must account for more than 50 percent of the
total capacity to produce the like vessel of that
portion of the industry expressing views.
Section 802(d)(6) provides that Commerce is not to initiate
an investigation if an antidumping proceeding by a WTO member
who is not a party to the Shipbuilding Agreement which covers
the same vessel either has been initiated and has been pending
for not more than a year or has been completed and resulted in
the imposition of antidumping measures or a negative
determination.
Reason for difference
Because each investigation under the Agreement will involve
only one, specific transaction, it is necessary to establish
deadlines for the filing of petitions and for self-initiation
to cover that transaction that are not needed under Title VII,
in which all entries during the period very recent to the
investigation are examined.
In addition, because vessels are generally unique and made
to specifications, a domestic producer may not have produced a
like vessel but could still be injured by the sale because that
producer was capable of producing the like vessel. The
Committee does not intend to weaken the requirement for Title
VII investigations that the petitioner, if a producer, actually
produce or manufacture the like product.
A 45-day period for determining whether to initiate, as
opposed to 20 days with a possible extension to 40 days, would
be established for Title VIII because of the Administration's
concern that the unique standing requirements and deadlines for
filing petitions create additional complexities requiring more
time to determine the sufficiency of the petition.
Depending on the circumstances of the sale of a vessel, it
is possible that a U.S. producer may seek to bring a Title VIII
action against the same vessel that is subject to an
antidumping action by a WTO member that is not an Agreement
member. Accordingly, the Shipbuilding Agreement requires the
non-initiation of an action by an Agreement member if another
action is pending to avoid double penalties. Title VIII would
implement this requirement.
d. Section 803 of New Title VIII: Preliminary Investigations
Present law: Title VII
Section 733(a) provides that the ITC is to make its
preliminary determination within 45 days after the filing of
the petition, or within 25 days of the date in which Commerce
notifies the ITC of initiation if Commerce takes additional
time to determine industry support for the petition.
Section 733(b) states that Commerce is to make its
preliminary determination within 140 days after initiation. An
extension is permitted in extraordinarily complicated cases or
for good cause until not later than 190 days from initiation.
Section 733(d) requires the posting of a bond or cash
deposit in the amount of the preliminary dumping margin upon
publication of an affirmative preliminary determination. As a
result, duties may be assessed against merchandise entering
after an affirmative preliminary dumping determination, and
even sooner under certain circumstances.
Explanation of provision
Section 803(a) would require the ITC to make its
preliminary determination within 90 days after the filing of
the petition.
Section 803(b)(1) provides that the deadline for Commerce's
preliminary determination is tied to the date on which the
vessel has been delivered if it will use cost data to determine
normal value or if normal value is to be determined on the
basis of constructed value (as opposed to comparison of like
vessel in home or third county market), which may delay the
investigation for several years.
Section 803(b) states that Commerce is to make its
preliminary determination within 160 days after initiation or
160 days after the date of delivery in a cost or constructed
value investigation. An extension is permitted in
extraordinarily complicated cases or for good cause until not
later than 190 days of initiation or the date of delivery, as
the case may be.
Title VIII would not permit any provisional remedy if an
affirmative preliminary determination is made.
Reason for difference
The difference in the time periods for preliminary
determinations in Title VIII cases versus Title VII
investigations is related to the different nature of the
investigations. Due to the unique nature of vessels, a Title
VIII cost investigation must be delayed until construction is
complete so that Commerce may obtain actual cost information.
Because the remedies for Title VII and Title VIII would be
completely different, the effect of a preliminary affirmative
Commerce determination would be different as well. Under Title
VIII, because a one-time charge would be imposed after a final
determination has been made, no relief after the preliminary
investigation is necessary. However, under Title VII, a duty is
applied on entries after the preliminary determination.
Accordingly, suspending liquidation and requiring the posting
of a bond or cash deposit after a preliminary affirmative
Commerce determination is warranted in Title VII cases.
e. Section 804 of New Title VIII: Termination or Suspension of
Investigation
Present law: Title VII
Title VII does not permit the suspension or termination of
an investigation based on action by a third country.
Explanation of provision
Section 804(d) provides for the suspension of an
investigation if a WTO member that is not a party to the
Shipbuilding Agreement initiates an antidumping proceeding with
respect to the same vessel. The investigation would be
terminated if the third country proceeding results in the
imposition of antidumping measures or a negative determination.
Otherwise, or if the investigation is not concluded within one
year, the suspension would end and the Title VIII investigation
would proceed.
Reason for difference
As described above, it is possible that a U.S. producer may
seek to bring a Title VIII action against a vessel that is
subject as well to antidumping action by a WTO member that is
not an Agreement member, if the vessel is sold to a buyer in
the United States and is also determined to be subject to an
antidumping investigation by a third country. Accordingly, the
Shipbuilding Agreement requires the suspension or termination
of an action by an Agreement member if another action is
pending to avoid double penalties, and section 804(d) would
implement that requirement.
f. Section 805 of New Title VIII: Final Determinations
Present law: Title VII
Under section 735(a), Commerce is required to make its
final determinations within 75 days after its preliminary
determination. This period may be extended under certain
circumstances to 135 days after publication of the preliminary
determination.
Section 735(b) provides that the ITC is to make its final
determination before the later of the 120th day on which
Commerce makes its affirmative preliminary determination or the
45th day after the day on which Commerce makes its affirmative
final determination.
Explanation of provision
Section 805(a) provides that Commerce would be required to
make its final determinations not later than 75 days after its
preliminary determination. This period may be extended under
certain circumstances to 290 days after initiation in ordinary
cases or after delivery of the vessel in cost or constructed
value investigations.
Section 805(b) provides that the ITC would be required to
make its final determination before the later of the 120th day
on which Commerce makes its affirmative preliminary
determination or the 45th day after the day on which Commerce
makes its affirmative final determination.
Reason for difference
The difference in the time periods for final determinations
in Title VIII cases versus Title VII investigations is related
to the different nature of the investigations and the delays
that may be caused by use of actual cost data under certain
circumstances.
g. Section 806 of New Title VIII: Imposition and Collectionof Injurious
Pricing Charge
Present law: Title VII
Section 736 provides that if Commerce and the ITC each make
affirmative final determinations, then Commerce is to publish
an antidumping order requiring the collection of a cash deposit
in the amount of the final antidumping margin against all
future entries within the scope of the order.
Section 751(a) provides for an annual review of each
antidumping order, during which Commerce examines the entries
made during the past year and determines the actual dumping
margin for those entries. Accordingly, under this retrospective
system, duties are not finally assessed until well after an
entry has been made. The new final dumping margin becomes the
cash deposit rate for future entries, until the conclusion of
the next administrative review.
Section 751(c) provides that all orders are to be
terminated (i.e., sunset) after five years unless the agencies
determine that dumping and injury would be likely to continue
or recur.
Explanation of provision
In the event of final affirmative determinations by
Commerce and the ITC under the new Title VIII, Commerce would
be required to publish an order imposing a one-time injurious
pricing charge on the foreign shipbuilder in amount of the
injurious pricing for the vessel subject to investigation, to
be paid within 180 days. The payment period may be extended
under extraordinary circumstances, subject to interest charges.
Once the charge is paid, there would be no continuing liability
on future sales or scrutiny of sales of other vessels by that
shipbuilder unless a new investigation is conducted. A vessel
purchased by a U.S. buyer after the order must be the subject
of a new investigation for an injurious pricing charge to cover
it. There would be no provision for an administrative review or
a sunset review.
Reason for difference
The new Title VIII would establish a remedy for injurious
pricing that is different from that of Title VII in order to
comply with the Agreement and because of the differences in the
nature of transactions concerning ships. Because vessels
engaged in international trade do not enter the United States
for consumption, the traditional antidumping mechanism of
imposing an antidumping duty on future entries would not
provide the domestic industry with sufficient relief.
Accordingly, the Agreement and the implementing bill would
establish a one-time injurious pricing charge to be assessed
against the shipyard producing the injuriously priced vessel.
Because the remedy would be a one-time charge, there is no need
for an administrative or sunset review of the order.
h. Section 807 of New Title VIII: Imposition of Countermeasures
Present law: Title VII
Neither Title VII nor the WTO antidumping agreement permits
the imposition of countermeasures. Instead, the antidumping
duty order affects entries of merchandise made after the
affirmative Commerce determination, in most cases.
Explanation of provision
Section 807 provides that failure to pay the injurious
pricing charge imposed against a foreign shipbuilder subjects
that shipbuilder to the imposition of countermeasures. The
countermeasures would take the form of a temporary denial (for
a period of up to four years after delivery of vessel) of
privileges to load or unload in the United States to vessels
contracted to be built by the offending shipbuilder within four
years after the effective date of the order.
Sections 807(b) and (c) set forth the procedures for
establishing countermeasures. Specifically, section 807(b)
would require Commerce to publish a notice of an intent to
impose countermeasures not later than 30 days before the
expiration of the time for payment of the injurious pricing
charge. Under section 807(c), Commerce would be required to
issue a determination and order imposing countermeasures within
90 days after the notice of intent is published. In issuing
this order, Commerce would be required to determine whether an
interested party has demonstrated that the scope or duration of
the countermeasures should be narrower or shorter than that set
forth in the notice of intent.
Section 807(d) provides that if countermeasures are
imposed, they may be reviewed annually as to scope and
duration.
Section 807(e) provides that countermeasures may be
extended in scope and duration beyond four years only if a
panel established under the Agreement so determines.
Finally, section 807(f) would require Commerce to publish
each year a list of all vessels subject to countermeasures and
to provide notice to certain interested parties.
Reason for difference
Because an order under Title VII generally affects future
entries, an importer may not avoid antidumping duties except by
halting imports or ceasing to dump. However, because an order
under Title VIII would not apply to future vessels delivered by
the shipyard in question, the United States would have no
recourse if the shipyard simply did not pay the injurious
pricing charge. Accordingly, it is necessary to establish a
mechanism for enforcing an order if the shipyard does not pay
the injurious pricing charge, and Title VIII and the Agreement
establish a countermeasure procedure as an enforcement
mechanism.
The Committee emphasizes that under section 861(17)(G),
purchasers of vessels potentially subject to countermeasures
have standing under Title VIII to participate fully in
proceedings concerning the imposition of countermeasures. The
Committee expects that the views of such purchasers, as well as
other entities such as domestic producers and respondents, be
considered in making countermeasure determinations.
The Committee also notes that the countermeasures would
apply to vessels contracted to be built by the offending
foreign producer after the date of the order imposing
countermeasures. Specifically, a vessel would be covered if the
material terms of sale for that vessel are established within a
period of four consecutive years beginning 30 days after the
notice of intent is published. The Committee is concerned that
purchasers be given ample notice as to vessels that may be
potentially covered by the countermeasure order and wishes to
avoid situations in which purchasers would not have sufficient
notice that changes in contract terms could subject the vessel
to countermeasures. Accordingly, the Committee intends that
only significant, material changes in the contract terms of a
legitimate contract entered into before the effective date of
the order should push the sale into the period covered by
countermeasures if those changes were made after the order's
effective date. Such significant changes amount to more than,
for example, merely changing the delivery date because of
construction delays, changing vessel specifications in a manner
that does not affect the overall nature of the vessel subject
to the contract, or other minor changes in price or terms. Of
course, the Committee also intends that a vessel to be built
within the countermeasure period would be included in the
countermeasure order if a sham contract were established
covering the vessel before the effective countermeasure date
simply to avoid imposition of countermeasures.
The Committee notes that countermeasures are a remedy
unique to Title VIII, and that certain purchasers have standing
as interested parties in these countermeasure proceedings.
Accordingly, the Committee intends that Commerce, in
determining whether to limit the scope and duration of a
countermeasure order to exclude certain vessels that may fall
within the countermeasure period, should take into account,
among all the circumstances to be considered, evidence that
only a shipyard subject to countermeasures is able to produce a
vessel to the specifications required by the purchaser within
the reasonable time period requested by that purchaser. At the
same time, it is also the Committee's view that neither this
nor any other single factor should necessarily be dispositive
in any determination. In addition, the exercise of such
discretion is intended to avoid unduly damaging purchasers, but
should not undermine the goal of enforcing payment of the
original injurious pricing charge.
i. Section 808 of New Title VIII: Injurious Pricing Petitions by Third
Countries
Present law: Title VII
Section 783 provides that the government of a WTO member
may file with USTR a petition requesting an investigation to
determine whether imports from another WTO member have been
sold in the United States at less than fair value and that an
industry in the petitioning country is materially injured by
the imports. After consulting with Commerce and the ITC, USTR
is required to determine whether to initiate an investigation
and must obtain the approval of the WTO Council for Trade in
Goods prior to initiating an investigation.
Explanation of provision
Section 808 provides that the government of a party to the
Shipbuilding Agreement may file with USTR a petition requesting
an investigation to determine whether a vessel from another
Agreement party has been sold to a U.S. buyer at less than fair
value and that an industry in the petitioning country is
materially injured by the sale. After consulting with Commerce
and the ITC and obtaining the approval of the Parties Group
under the Agreement, USTR would be required to determine
whether to initiate an investigation.
Reason for difference
Section 808 is comparable to section 783 and is intended to
provide an opportunity to conduct an investigation if the
injury caused by unfair pricing is experienced in another
country. This provision is intended to implement the
Shipbuilding Agreement.
j. Section 821 of New Title VIII: Export Price
Present law: Title VII
Section 772 sets forth the rules for determining the export
price or constructed export price to be used in antidumping
investigations. Section 772(a) defines ``export price'' as the
price at which the subject merchandise is first sold (or agreed
to be sold) before the date of importation by the producer or
exporter of the subject merchandise outside the United States
to an unaffiliated purchaser in the United States or to an
unaffiliated purchaser for exportation to the United States.
Section 772(b) defines ``constructed export price'' as the
price at which the subject merchandise is first sold (or agreed
to be sold) in the United States before or after the date of
importation by or for the account of the producer or exporter
of such merchandise or by a seller affiliated with the producer
or exporter, to an unaffiliated purchaser.
Sections 772(c) and (d) set forth the adjustments to be
made to export price and constructed export price.
Explanation of provision
Section 821 sets forth the rules for determining the export
price to be used in injurious pricing investigations. ``Export
price'' is defined as the price at which the subject vessel is
first sold (or agreed to be sold) by or for the account of the
foreign producer of the subject vessel to an unaffiliated U.S.
buyer. Such a sale would include any transfer in ownership
interest, including by lease or long-term bareboat charter, in
conjunction with the original transfer from the producer,
either directly or indirectly, to a U.S. buyer. Section 821(b)
sets forth the adjustments to be made to export price.
Reason for difference
Title VIII sets forth a definition of export price that is
similar to the definition in Title VII. Because of the unique
manner in which vessels are sold, there is no need for a
constructed export price concept as in Title VII.
k. Section 822 of New Title VIII: Normal Value
Present law: Title VII
The extent to which normal value exceeds export price is
the amount of dumping. Section 773(a)(1) provides that where
possible, normal value represents the price of like merchandise
in the home market, as adjusted. If home market sales are not
available or are so few as to form an inadequate basis for
comparison, then Commerce resorts to either the price at which
the merchandise is sold in third countries or to a constructed
value to determine normal value. Section 773(e) provides that
in constructed value situations, normal value is derived by
constructing a normal value based on a statutory formula, which
is the sum of the costs of production, plus the actual amount
of profit and selling, administrative, and general expenses.
Section 773(b) provides that if Commerce determines that
home market sales at less than the cost of production have been
made within an extended period of time in substantial
quantities and were not at prices that permit the recovery of
costs within a reasonable period of time, then these sales may
be disregarded in determining normal value. If there are no
sales above cost, then Commerce must use constructed value to
determine normal value.
Section 773(f)(1)(C) provides for adjusting costs if they
have been affected by startup operations. Title VII contains no
special provision for adjusting costs due to ``extraordinary
circumstances'' such as labor disputes, fire, or natural
disaster.
Explanation of provision
Section 822(a)(1) provides that normal value, where
possible, would represent the price of a like vessel in home
market, as adjusted, if sold at a time that is reasonably
corresponding to the time of sale under investigation. Section
822(a)(1)(D) defines such contemporaneous sales as being within
three months before or after the sale of the subject vessel or,
in the absence of such sales, such longer period as Commerce
determines would be appropriate. If home market sales are not
available, Commerce would be required to resort first to third
country sales. Only if such sales are inappropriate could
Commerce use constructed value to determine normal value.
Section 822(e) provides that in constructed value situations,
normal value would be derived based on a statutory formula,
which is the sum of the costs of production, plus the actual
amount of profit and selling, administrative, and general
expenses. Under section 803(b)(1)(C), if constructed value is
used, the investigation may be delayed until the ship in
question has been constructed even though the petition was
filed at the time of contract.
Section 822(b) states that if Commerce determines that a
home market sale was made at less than cost of production and
does not permit recovery of all costs within five years, that
sale may be disregarded in determining normal value. If a sale
is disregarded, normal value would be based on another sale of
a foreign like vessel. If no such sales are available, normal
value would based on the constructed value of the subject
merchandise.
Section 822(f)(1)(C) provides for adjusting costs if they
have been affected by startup operations. Section 822(f)(1)(D)
would require that costs due to ``extraordinary circumstances''
such as labor disputes, fire, and natural disaster, be
excluded.
Reason for difference
The rules applicable to normal value in Title VIII are
similar to those of Title VII, adjusted where necessary to take
into account the lengthy periods required to construct ships
and the fact that, due to the unique nature of vessels, there
often are few, if any, vessels constructed by the foreign
shipbuilder that may be used as an appropriate comparison.
The Committee understands that the Administration expects
to use constructed value in most investigations because of lack
of actual comparable sales. However, the Committee expects that
Commerce will make every effort to base normal value on home
market or third country sales if they are available within a
reasonably coincident period because a comparison based on
actual sales is generally more indicative of whether there in
fact has been injurious pricing.
l. Section 823 of New Title VIII: Currency Conversion
Present law: Title VII
Under section 773A(a), Commerce is required to convert
foreign currency into U.S. dollars using the exchange rate in
effect on the date of sale of the subject merchandise, except
that if it is established that a currency transaction on
forward markets is directly linked to a sale under
consideration, the rate specified in the forward sale agreement
is to be used. Fluctuations in exchange rates are to be
ignored.
Under section 773A(b), if there is a sustained movement in
the value of the foreign currency relative to the U.S. dollar,
Commerce is to allow exporters at least 60 days to adjust their
export prices to reflect such sustained movements.
Explanation of provision
Under section 823(a), Commerce would be required to convert
foreign currency into U.S. dollars using the exchange rate in
effect on the date of sale of the subject vessel, except that
if it is established that a currency transaction on forward
markets is directly linked to a sale under consideration, the
rate specified in the forward sale agreement would be used.
Section 823(b) would define the date of sale as the date of
the contract of sale. If the material terms of sale are
significantly changed after that date, the date of sale would
be the date of the change, and Commerce would be required to
adjust for any unreasonable effect on the margin due only to
fluctuations in the exchange rate between the original and the
new dates of sale.
Reason for difference
The differences between section 823 and section 773A of
Title VII reflect differences in the nature of the respective
remedies as well as particular characteristics of the
shipbuilding industry. In a Title VII investigation, Commerce
generally investigates multiple transactions over a period of
investigation that lasts six months. During that period of
time, the exchange rate may fluctuate or change. Accordingly,
under Title VII, Commerce is required to allow time to adjust
prices in response to sustained changes in the exchange rate.
However, each Title VIII investigation would involve only a
single export transaction.
Furthermore, two years or more may elapse between the time
a ship contract is signed and ship construction is completed.
Because of the long lead-time, during which numerous contract
modifications may occur that would change the date of sale,
there is much greater potential for movements in exchange rates
to unreasonably distort the margin calculation for that sale.
Therefore, section 823 requires adjustments to eliminate such
distortions.
m. Sections 841-845 of New Title VIII: Procedures
Present law: Title VII
Sections 774, 776, 777, and 782 of Title VII and section
129 of the Uruguay Round Agreements Act set forth procedural
requirements concerning antidumping investigations.
Specifically, section 774 requires Commerce and the ITC each to
hold hearings upon request during their investigations.
Section 776 provides for determinations on the basis of
facts available. A number of new procedural safeguards were
added as part of the Uruguay Round Agreements Act, including
limiting the use of adverse inferences to those cases in which
the agency finds that an interested party has failed to
cooperate by not acting to the best of its ability to comply
with a request for information. Moreover, whenever the agency
relies on secondary information, the agency, to the extent
practicable, is to corroborate that information.
Section 777 sets forth the requirements for making
information concerning the investigation available to the
public, treating information as proprietary, disclosing
proprietary information under protective order, serving
submissions on other parties, handling violations of protective
orders and sanctions, providing opportunity for comment by
consumers and industrial users, and publishing determinations.
Section 782 sets forth procedures for conducting
investigations, including certification of submissions, the
manner for handling difficulties by the parties in meeting
requirements of the investigation, treatment of deficient
submissions, use of information submitted by the parties,
nonacceptance of submissions, public comment on information,
and verification of information submitted. One of the most
important elements of section 782 is the requirement that the
agencies shall not decline to consider information submitted by
an interested party that is necessary to the determination but
does not meet all of the requirements of the agency, if the
information is submitted by the deadline, it can be verified,
it is not so incomplete that it cannot serve as a reliable
basis for reaching a determination, the interested party acted
to the best of its ability to provide the information, and the
information can be used without undue difficulties.
Because antidumping and injury determinations are subject
to WTO dispute resolution, section 129 of the Uruguay Round
Agreements Act sets forth the requirements for administrative
action following WTO panel reports.
Explanation of provisions
Sections 841 through 845 of H.R. 2754, as amended, set
forth procedural requirements concerning the injurious pricing
mechanism. Specifically, section 841 provides that Commerce and
the ITC are each to hold hearings upon request during their
investigations.
Section 842 provides for determinations on the basis of
facts available. As with Title VII, the use of adverse
inferences would be limited to those cases in which the agency
finds that an interested party has failed to cooperate by not
acting to the best of its ability to comply with a request for
information. Moreover, whenever the agency relies on secondary
information, the agency, to the extent practicable, would be
required to corroborate that information.
Section 843 sets forth the requirements for making
information concerning the investigation available to the
public, treating information as proprietary, disclosing
proprietary information under protective order, serving
submissions on other parties, handling violations of protective
orders and sanctions, providing opportunity for comment by
vessel buyers, and publishing determinations.
Section 844 sets forth procedures for conducting
investigations, including certification of submissions, the
manner for handling difficulties by the parties in meeting
requirements of the investigation, treatment of deficient
submissions, use of information submitted by the parties,
nonacceptance of submissions, public comment on information,
and verification of information submitted. The provision would
require that the agencies not decline to consider information
submitted by an interested party that is necessary to the
determination but does not meet all of the requirements of the
agency, if the information is submitted by the deadline, it can
be verified, it is not so incomplete that it cannot serve as a
reliable basis for reaching a determination, the interested
party acted to the best of its ability to provide the
information, and the information can be used without undue
difficulties.
Because injurious pricing determinations are subject to
dispute resolution under the Agreement, section 845 sets forth
the requirements for administrative action following
Shipbuilding Agreement panel reports.
Reason for difference
The Committee intends that the procedural requirements for
shipbuilding investigations mirror those for antidumping
investigations. Accordingly, antidumping procedural
requirements have been repeated in H.R. 2754, as amended,
making only those changes necessitated by the differences
between the WTO antidumping agreement and the Shipbuilding
Agreement.
n. Section 861 of New Title VIII: Definitions
Present law: Title VII
Industry: Section 771(4) defines ``industry'' as the
producers as a whole of a domestic like product, or those
producers whose collective output of a domestic like product
constitutes a major proportion of the total domestic production
of the product.
Buyer, U.S. buyer: Title VII does not contain a definition
of buyer .
Commerce may determine that a lease is equivalent to a sale
under section 771(19) after considering the terms of the lease,
commercial practice within the industry, the circumstances of
the transaction, whether the product subject to the lease is
integrated into the operations of the lessee or importer,
whether in practice there is a likelihood that the lease will
be continued or renewed for a significant period of time, and
other relevant factors, including whether the lease transaction
would permit avoidance of antidumping or countervailing duties.
Product subject to investigation: Section 771(16) provides
that a subject product may be from any country, even if it is
not a WTO member, as long as the product is imported into the
United States.
Domestic like product: Section 771(10) defines a ``domestic
like product'' as a product which is like, or in the absence of
like, most similar in characteristics and uses with, the
article subject to investigation. The ITC generally applies a
six-factor test in determining like product, examining physical
characteristics and uses, interchangeability, channels of
distribution, customer and producer perceptions, common
manufacturing facilities, production processes and production
employees, and, where appropriate, price. Timken Co. v. United
States, Slip op. 96-8 at 9 (Ct. Int'l Trade, Jan. 3, 1996).
Material injury: Section 771(7) defines ``material injury''
as harm that is not inconsequential, immaterial, or
unimportant. In making its determination, the ITC is required
under section 771(7)(B) to consider the volume of imports of
the subject merchandise, the effect of imports of that
merchandise on prices in the United States for like products,
and the impact of imports of such merchandise on domestic
producers of like products.
In evaluating the volume of imports, section 771(7)(C)(i)
requires the ITC to consider whether the volume of imports, or
any increase in that volume, either in absolute terms or
relative to production or consumption in the United States is
significant.
In evaluating the effect of imports on prices, section
771(7)(C)(ii) specifies that the ITC consider whether there has
been significant underselling by the imported merchandise as
compared with prices of like products in the Untied States and
whether the effect of imports otherwise depresses prices to a
significant degree or prevents price increases, which otherwise
would have occurred, to a significant degree.
Finally, in evaluating the impact on the domestic industry,
section 771(7)(C)(iii) requires evaluation of all relevant
economic factors having a bearing on the state of the U.S.
industry, including actual and potential decline in output,
sales, market share, profits, productivity, return on
investments, and utilization of capacity; factors affecting
domestic prices; actual and potential negative effects on cash
flow, inventories, employment, wages, growth, ability to raise
capital, and investment; actual and potential negative effects
on the existing development and production efforts of the
domestic industry; and the magnitude of the dumping margin. All
factors are to be evaluated within the context of the business
cycle and conditions of competition that are distinctive to the
domestic industry.
Threat: Section 771(7)(F) specifies that in determining
whether a U.S industry is threatened with material injury by
reason of imports, the ITC is to consider, among other relevant
economic factors, any existing unused production capacity or
imminent, substantial increase in production capacity in the
exporting country indicating the likelihood of substantially
increased imports of the subject merchandise, taking into
account the availability of other export markets to absorb any
additional exports; a significant rate of increase of the
volume or market penetration of imports of the subject
merchandise indicating the likelihood of substantially
increased imports; whether imports of the subject merchandise
are entering at prices that are likely to have a significant
depressing or suppressing effect on domestic prices, and are
likely to increase demand for further imports; inventories of
the subject merchandise; the potential for product shifting;
the actual and potential negative effects on the existing
development and production efforts of the domestic industry;
and any other demonstrable adverse trends that indicate the
probability that there is likely to be material injury by
reason of imports of subject merchandise.
Cumulation: Under section 771(7)(G), the ITC is required,
subject to certain exceptions, to cumulatively assess the
volume and effect of imports of the subject merchandise from
all foreign countries with respect to which petitions were
filed on the same day, investigations were self-initiated on
the same day, or petitions were filed and investigations were
self-initiated on the same day, if such imports compete with
each other and with domestic like products in the U.S. market.
In each final determination in which it cumulatively assesses
the effects of sales, the ITC is required to make its
determinations based on the record compiled in the first
investigation in which it makes a final determination, with
certain specified exceptions.
Interested party: Section 771(9) defines ``interested
party'' as the foreign manufacturer, producer, or exporter, or
the U.S. importer of subject merchandise or a trade or business
association a majority of whose members are producers,
exporters, or importers of the subject merchandise; the
government of the country in which such merchandise is produced
or manufactured or from which such merchandise is exported; a
manufacturer, producer, or wholesaler in the United States of a
domestic like product; a certified union or recognized union or
group of workers which is representative of an industry engaged
in the manufacture, production, or wholesale in the United
States of a domestic like product; a trade or business
association a majority of whose members manufacture, produce,
or wholesale a domestic like product in the United States; and
an association a majority of whose members is composed of
interested parties listed above.
Explanation of provision
Industry, Producer: Section 861(4) defines ``industry'' as
the producers as a whole of a domestic like vessel, or those
producers whose collective capability to produce a domestic
like vessel constitutes a major proportion of the total
domestic capability to produce a like vessel. A ``producer'' is
defined as an entity that is producing the domestic like vessel
and an entity with the capability to produce the domestic like
vessel. ``Capability to produce'' is further defined as the
capability of a producer to produce a domestic like vessel with
its present facilities or by adapting its facilities in a
timely manner.
Buyer, U.S. buyer: Section 801(a)(1) requires that a vessel
be sold directly or indirectly to a U.S. buyer for an
investigation to be commenced.
Section 861(5) defines a ``buyer'' as any person who
acquires an ownership interest in a vessel, including by lease
or long-term bareboat charter, in conjunction with the original
transfer from the producer, either directly or indirectly.
Section 861(7) defines ownership interest as including any
contractual or proprietary interest allowing the beneficiary to
take advantage of the operation of a vessel in a manner
substantially comparable to the owner. Section 861(6) defines a
U.S. buyer as a buyer that is a U.S. citizen, a juridical
entity organized under the laws of the United States, or
another juridical entity owned or controlled by such a
juridical entity or U.S. citizen. ``Owned'' is defined as
having more than a 50 percent interest. ``Control'' is defined
as the actual ability to have substantial influence on
corporate behavior, presumed to exist where there is at least a
25 percent interest.
Vessel subject to investigation: Section 861(8) defines
``vessel'' as a self-propelled seagoing vessel of 100 gross
tons or more used for transportation of goods or persons or for
performance of a specialized service and a tug of 365 kilowatts
or more, as long as it is produced in a Shipbuilding Agreement
Party or in a country that is neither a Shipbuilding Agreement
Party nor a WTO member. Accordingly, respondents to injurious
pricing cases must be from countries that are parties to
Agreement or from non-parties who are not WTO Members.
Like vessel: Section 861(9) defines a ``like vessel'' as a
vessel of the same type, purpose, and approximate size as the
subject vessel and possessing characteristics closely
resembling those of the subject vessel.
Material injury: Section 861(16) defines ``material
injury'' as harm that is not inconsequential, immaterial, or
unimportant. In making its determination, the ITC would be
required under section 861(16)(B) to consider the sale of the
subject vessel, the effect of the sale of the subject vessel on
prices in the United States for a domestic like vessel, and the
impact of the sale of the subject vessel on domestic producers
of the domestic like vessel.
In evaluating the sale of the subject vessel, section
861(16)(C)(i) would require the ITC to consider whether the
sale, either in absolute terms or relative to production or
demand in the United States, in terms of either volume or
value, is or has been significant.
In evaluating the effect of the sale of the subject vessel
on prices, section 861(16)(C)(ii) specifies that the ITC
consider whether there has been significant underselling of the
subject vessel as compared with the price of a domestic like
vessel and whether the effect of the sale otherwise depresses
or has depressed prices to a significant degree or prevents or
has prevented price increases, which otherwise would have
occurred, to a significant degree.
Finally, in evaluating the impact on the domestic industry,
section 861(16)(C)(iii) requires evaluation of all relevant
economic factors having a bearing on the state of the U.S.
industry, including actual and potential decline in output,
sales, market share, profits, productivity, return on
investments, and utilization of capacity; factors affecting
domestic prices; actual and potential negative effects on cash
flow, employment, wages, growth, ability to raise capital, and
investment; actual and potential negative effects on the
existing development and production efforts of the domestic
industry; and the magnitude of the injurious pricing margin.
All factors are to be evaluated within the context of the
business cycle and conditions of competition that are
distinctive to the domestic industry.
Threat: Section 861(16)(E) specifies that in determining
whether a U.S industry is threatened with material injury by
reason of the sale of the subject vessel, the ITC is to
consider, among other relevant economic factors, any existing
unused production capacity or imminent, substantial increase in
production capacity in the exporting country indicating the
likelihood of substantially increased sales of a foreign like
vessel to U.S. buyers, taking into account the availability of
other export markets to absorb any additional exports; whether
the sale of a foreign like vessel or other factors indicate the
likelihood of significant additional sales to U.S. buyers;
whether the sale of the subject vessel or sale of a foreign
like vessel by the foreign producer is at a price that is
likely to have a significant depressing or suppressing effect
on domestic prices, and is likely to increase demand for
further sales; the potential for product shifting; the actual
and potential negative effects on the existing development and
production efforts of the domestic industry; and any other
demonstrable adverse trends that indicate the probability that
there is likely to be material injury by reason of the sale of
the subject vessel.
Cumulation: Under section 861(16)(F), the ITC would be
required, subject to certain exceptions, to cumulatively assess
the effects of sales of foreign like vessels from all foreign
producers with respect to which petitions were filed on the
same day, investigations were self-initiated on the same day,
or petitions were filed and investigations were self-initiated
on the same day, if, with respect to such vessels, the foreign
producers compete with each other and with producers of a
domestic like vessel in the U.S. market. In each final
determination in which it cumulatively assesses the effects of
sales, the ITC may, but is not required to, make its
determinations based on the record compiled in the first
investigation in which it makes a final determination.
Interested party: Section 861(17) defines ``interested
party'' as the foreign producer, seller (other than the foreign
producer), and the U.S. buyer of the subject vessel or a trade
or business association a majority of whose members are the
foreign producer, seller, or U.S. buyer of the subject vessel;
the government of the country in which the subject vessel is
produced or manufactured; a producer that is a member of an
industry; a certified union or recognized union or group of
workers which is representative of an industry; a trade or
business association a majority of whose members are producers
in an industry; and an association a majority of whose members
are composed of interested parties listed above. In addition,
an interested party would include, for purposes of section 807
(permitting the imposition of countermeasures), a purchaser
who, after the effective date of an order imposing
countermeasures, entered into a contract of sale with the
foreign producer that is subject to the order.
Reason for difference
Industry, Producer: As discussed above with respect to
section 802 of Title VIII, because vessels are generally unique
and made to specifications, a domestic producer may not have
produced a like vessel but could still be injured by the sale
because that producer was capable of producing a like vessel.
Accordingly, the definition of ``industry'' and ``producer'' in
Title VIII would not require that the party actually produce a
like vessel in order to be considered a producer or part of the
industry. However, for Title VII investigations, the Committee
does not intend to weaken the requirement that domestic
producers actually produce or manufacture the like product
(except in the case of material retardation).
Buyer, U.S. buyer: However, because ocean-going vessels are
technically not imported or entered for consumption in the
United States, the Agreement and the implementing bill permit
investigations to be commenced only when a vessel is sold
directly or indirectly to a U.S. buyer, regardless of whether
the vessel enters the United States.
In addition, Title VIII contains a more detailed definition
of ownership interest because of the complex nature of
transactions involving ships, such as leases or long-term
bareboat charters, in keeping with the requirements of the
Agreement.
Vessel/product subject to investigation: There is a major
difference between Title VII and Title VIII concerning who may
be a respondent. Title VII provides that a respondent may be
from any country as long as product imported into the United
States, even if it is not a WTO Member. Under Title VIII, on
the other hand, respondents must be from countries that are
parties to Agreement or from non-parties who are not WTO
Members. Accordingly, if a producer is from a country that is a
member of the WTO but is not a member of the Shipbuilding
Agreement, the Title VIII remedy may not be utilized. This
distinction is made out of concern that the United States might
be challenged for violating its WTO obligations by taking
action against a WTO member that agreed to be bound only by the
provisions of the WTO agreement and had not consented to any
further remedy under the Shipbuilding Agreement.
Like vessel: The definition of ``like product'' in Title
VII is comparable to that of ``like vessel'' in Title VIII. The
Committee recognizes that ocean-going vessels are frequently
built to unique specifications. Accordingly, the Committee
intends that under the appropriate circumstances, there may be
small differences in size and equipment between like vessels.
Material injury: Except as noted below, the ``material
injury'' definition of Title VIII is intended to be similar to
that of Title VII, eliminating or modifying certain injury
criteria to take into account the nature of the shipbuilding
industry and the Agreement's requirements.
Under Title VII, the ITC is to consider the volume of
subject imports in determining whether the industry has been
materially injured. In determining material injury in a Title
VIII investigation, the ITC would be required to consider
whether the sale has been significant. The Committee intends
that in the appropriate circumstances, only one sale may be
sufficient to satisfy this requirement under Title VIII,
whereas it would be an unusual case in which a single sale was
a significant volume under Title VII. In addition, the
Committee intends consideration of the ``sale'' to include both
the number of sales and the tonnage and value represented by
that sale or sales, as appropriate.
As discussed above concerning section 801, a Title VIII
injury investigation is retrospective because the focus is on
the vessel under investigation and not subsequently sold
vessels. Accordingly, the material injury provision under Title
VIII is drafted to permit consideration of whether the subject
vessel has caused price depression or suppression. However, the
Committee intends that the present material injury requirement
of Title VII remain unchanged. In addition, the Committee
intends under Title VIII the ITC must find that injury has been
by reason of the vessel under investigation in order to reach
an affirmative determination.
Threat: Except as noted below, the ``threat'' definition of
Title VIII is intended to be similar to that of Title VII,
eliminating or modifying certain criteria to take into account
the nature of the shipbuilding industry and the Agreement's
requirements.
The Committee notes that although Title VIII makes
reference to ``substantially increased sales'' in the threat
section as in Title VII, the number of vessels or increase in
production capacity may, in the appropriate circumstances,
satisfy the Title VIII criterion even though it would not be
sufficient in most cases under Title VII. The Committee further
intends consideration of ``sale'' to include the number of
sales and the tonnage and value represented by that sale or
sales.
Cumulation: The rules concerning the types of
investigations that must be cumulated under Title VII and Title
VIII are intended to be the same. The only difference concerns
the use, in final determinations in which the ITC performs a
cumulative analysis, of the record compiled in the first
investigation in which it makes a final determination. In Title
VII cases, the ITC is required to use such a record. However,
in Title VIII investigations, the ITC may but would not be
required to use this record. The reason for the difference is
that some Title VIII investigations may be delayed for long
periods of time in order to obtain cost of production
information, and use of the record in the first investigation
may, therefore, not be appropriate.
Interested party: The definitions of ``interested party''
for Title VII and Title VIII are comparable, except that Title
VIII would permit a purchaser to be an interested party in
countermeasure proceedings if, after the effective date of an
order imposing countermeasures, it entered into a contract of
sale with the foreign producer that is subject to the order.
Giving such parties interested party status would permit them
to participate in proceedings before the Commerce Department in
which the scope and duration of countermeasures is being
determined.
2. SECTION 102: ENFORCEMENT OF COUNTERMEASURES
Present law
Current law does not provide for the imposition of
countermeasures in the antidumping context.
Explanation of provision
Section 102 would amend Title IV of the Tariff Act of 1930
to provide the Customs Service with the authority to deny any
request for a permit to lade or unlade passengers, merchandise,
or baggage from or onto vessels listed by Commerce as being
subject to countermeasures. Section 102 provides for certain
limited exceptions to this rule.
Reason for change
Because the antidumping law permits the assessment of an
antidumping duty on future entries of merchandise subject to
order, additional enforcement mechanisms are not necessary.
Unlike the WTO antidumping agreement, the Shipbuilding
Agreement specifically provides for the imposition of
countermeasures if the foreign shipyard in question does not
pay the injurious pricing charge assessed against it. Section
102 is intended to implement this provision.
3. SECTION 103: JUDICIAL REVIEW IN INJURIOUS PRICING AND COUNTERMEASURE
PROCEEDINGS
Present law: Title VII
Section 516A of the Tariff Act of 1930 provides that
interested parties dissatisfied with certain preliminary and
final determinations may challenge them before the Court of
International Trade. The standard of review for final
determinations is whether the determination is unsupported by
substantial evidence on the record or is otherwise not in
accordance with law. The standard of review for the limited
preliminary determinations that are subject to review is
whether the determination is arbitrary, capricious, and an
abuse of discretion or is otherwise not in accordance with law.
Explanation of provision
As under Title VII, section 103 provides that interested
parties dissatisfied with final determinations may challenge
them before the Court of International Trade, and the
applicable standard of review is whether the determination is
``unsupported by substantial evidence on the record, or
otherwise not in accordance with law.'' In addition, certain
preliminary determinations and countermeasure determinations
may be challenged, and the standard of review is whether
determination is ``arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law.''
Reason for change
The Committee intends that H.R. 2754, as amended, provide
essentially analogous opportunities for judicial review as
under Title VII. The differences between Title VII and H.R.
2754, as amended, are intended to take into account the
differences in the two types of investigations, especially the
imposition of countermeasures that would permitted in Title
VIII and the absence of comparable administrative and sunset
reviews.
B. Title II: Other Provisions
1. SECTION 201: EQUIPMENT AND REPAIR OF VESSELS
Present law
Section 466 of the Tariff Act of 1930 imposes a 50 percent
duty on repairs to U.S.-flag vessels made outside the United
States.
Explanation of provision
Section 201 would amend section 466 of the Tariff Act of
1930 to eliminate the current 50 percent duty on repairs to
covered U.S.-flag vessels made outside the United States but
only if such repairs are made in an Agreement Party.
Reason for change
The Shipbuilding Agreement no longer permits the collection
of duties on vessel repairs made in a signatory to the
Agreement. Accordingly, U.S. law must be changed to eliminate
the duty if the repairs to a U.S.-flag vessel were made in a
signatory to the Agreement. However, the duty would remain in
place if the repairs were made in a country other than an
Agreement signatory.
2. SECTION 202: EFFECT OF AGREEMENT WITH RESPECT TO PRIVATE REMEDIES
Present law
A number of implementing bills, such as section 102(c) of
the Uruguay Round Agreements Act (P.L. 103-465) and section
102(c) of the North American Free Trade Agreement
Implementation Act (P.L. 103-182), provide that no person other
than the United States is to have a cause of action or defense
under the agreement in question or may challenge government
action or inaction on the ground that it is inconsistent with
the agreement.
Explanation of provision
Section 202 provides that no person other than the United
States is to have a cause of action or defense under the
Agreement or may challenge government action or inaction on the
ground that it is inconsistent with the Agreement.
Reason for change
The Committee intends that section 202 provide the same
limitations as in the Uruguay Round Agreements Act and the
North American Free Trade Agreement Implementation Act.
3. SECTION 203: IMPLEMENTING REGULATIONS
Present law
No applicable provision.
Explanation of provision
Section 203 provides that the relevant agencies may issue
regulations as may be necessary to ensure that the Act is
appropriately implemented on the date that the Agreement enters
into force with respect to the United States.
Reason for change
The Committee intends that the relevant agencies take steps
to ensure through regulation that the Act is appropriately
implemented upon entry into force. With respect to injurious
pricing, the Committee expects that regulations would be
modeled after the regulations implementing Title VII of the
Tariff Act of 1930 wherever possible, making only those changes
necessitated by the differences between H.R. 2754, as amended,
and existing law.
C. Title III: Revenue Offset
1. SECTION 301: PENALTY FOR FAILURE TO FILE DISCLOSURE OF EXEMPTION FOR
SHIPPING INCOME OF FOREIGN PERSONS
Present law
The United States imposes a 4-percent tax on the U.S.-
source gross transportation income of nonresident alien
individuals and foreign corporations (sec. 887). This tax does
not apply to income that is effectively connected with the
foreign person's conduct of a U.S. trade or business.
Nonresident alien individuals and foreign corporations are
subject to U.S. tax at regular graduated rates on net income
that is effectively connected with a U.S. trade or business
(secs. 871(b) and 882). The U.S. taxation of a nonresident
alien or foreign corporation may be altered by the provisions
of an applicable tax treaty.
Transportation income is any income derived from, or in
connection with, the use (or hiring or leasing for use) of a
vessel or aircraft (or a container used in connection
therewith) or the performance of services directly related to
such use (sec. 863(c)(3)). Transportation income attributable
to transportation that begins and ends in the United States is
treated as derived from sources in the United States (sec.
863(c)(1)). In the case of transportation income attributable
to transportation that begins in, and ends outside, the United
States or that begins outside, and ends in, the United States,
generally 50 percent is treated as U.S. source and 50 percent
is treated as foreign source (sec. 863(c)(2)). U.S.-source
transportation income is treated as effectively connected with
a foreign person's conduct of a U.S. trade or business only if
the foreign person has a fixed place of business in the United
States that is involved in the earning of such income and
substantially all of such income of the foreign person is
attributable to regularly scheduled transportation (sec.
887(b)(4)).
An exemption from U.S. tax is provided for gross income
derived by a nonresident alien individual from the
international operation of a ship, provided that the foreign
country in which such individual is resident grants an
equivalent exemption to individual residents of the United
States (sec. 872(b)(1)). A similar exemption from U.S. tax is
provided for gross income derived by a foreign corporation from
the international operation of a ship, provided that the
foreign country in which the corporation is organized grants an
equivalent exemption to corporations organized in the United
States (sec. 883(a)(1)).
Pursuant to guidance published by the Internal Revenue
Service, a nonresident alien individual or foreign corporation
that is entitled to an exemption from U.S. tax for its income
from the international operation of a ship must file a U.S.
income tax return and must attach to such return a statement
claiming the exemption (Rev. Proc. 91-12, 1991-1 C.B. 473). If
the foreign person is claiming an exemption based on an
applicable income tax treaty, the foreign person must disclose
that fact as required by the Secretary of the Treasury (sec.
6114). The penalty for failure to make disclosure of a treaty-
based position as required under section 6114 is $1,000 for an
individual and $10,000 for a corporation (sec. 6712).
At the time the 4-percent tax on U.S.-source gross
transportation income was enacted, concern was expressed about
whether compliance with the tax, which is collected by return,
would be adequate. It was intended that the tax-writing
committees of Congress and the Secretary of the Treasury would
study the issue of compliance and that the Secretary would make
recommendations if compliance did not prove adequate. Joint
Committee on Taxation, ``General Explanation of the Tax Reform
Act of 1986'' (JCS-10-87), May 4, 1987, at 930.
Explanation of provision
Under the provision, a nonresident alien individual or
foreign corporation that claims exemption from U.S. tax for
income from the international operation of ships but does not
satisfy the filing requirements for claiming such exemption is
subject to the penalty of the denial of such exemption and any
deductions or credits otherwise allowable in determining the
U.S. tax liability with respect to such income. In addition,
under the provision, if a nonresident alien individual or
foreign corporation that has a fixed placed of business in the
United States fails to satisfy the filing requirements for
claiming an exemption from U.S. tax for its income from the
international operation of ships, such person is subject to the
additional penalty that any foreign source income from the
international operation of ships that is attributable to such
fixed place of business is treated as effectively connected
with the conduct of a U.S. trade or business. Income that is so
treated as effectively connected with a U.S. business is
subject to U.S. tax at graduated rates (and is subject to the
disallowance of deductions and credits described above). The
Secretary of the Treasury may waive all or part of these
penalties upon a showing by the foreign person that there was
reasonable cause for the failure and the person acted in good
faith. The provision does not apply to the extent the
application would be contrary to any treaty obligation of the
United States.
The provision also provides that the U.S. Customs Service
will provide to the Secretary of the Treasury the information
specified by the Secretary to enable the Secretary to identify
foreign-flag ships engaged in shipping to or from the United
States.
Reason for change
The Committee believes that it is appropriate to impose
significant penalties for a failure to satisfy the filing
requirements for claiming the exemption from U.S. tax that is
available to certain foreign persons with respect to income
from the international operation of ships.
Effective date
The provision is effective for taxable years beginning
after the later of the date the Shipbuilding Agreement takes
effect or December 31, 1996.
III. VOTE OF THE COMMITTEE
In compliance with clause 2(l)(2)(B) of rule XI of the
Rules of the House of Representatives, the following statement
is made relative to the vote of the Committee in reporting the
bill, H.R. 2754.
Motion to report the bill
The bill, H.R. 2754, as amended, was ordered favorably
reported on March 21, 1996, by a roll call vote of 27 yeas to 4
nays, with a quorum present. The vote was as follows:
----------------------------------------------------------------------------------------------------------------
Representatives Yea Nay Representatives Yea Nay
----------------------------------------------------------------------------------------------------------------
Mr. Archer.............................. X ....... Mr. Gibbons.................... X ........
Mr. Crane............................... X ....... Mr. Rangel..................... X ........
Mr. Thomas.............................. ........ ....... Mr. Stark...................... ........ ........
Mr. Shaw................................ X ....... Mr. Jacobs..................... X ........
Mrs. Johnson............................ X ....... Mr. Ford....................... X ........
Mr. Bunning............................. X ....... Mr. Matsui..................... ........ ........
Mr. Houghton............................ X ....... Mrs. Kennelly.................. X ........
Mr. Herger.............................. X ....... Mr. Coyne...................... ........ ........
Mr. McCrery............................. X ....... Mr. Levin...................... X ........
Mr. Hancock............................. X ....... Mr. Cardin..................... X ........
Mr. Camp................................ X ....... Mr. McDermott.................. ........ ........
Mr. Ramstad............................. X ....... Mr. Kleczka.................... ........ X
Mr. Zimmer.............................. X ....... Mr. Lewis...................... ........ ........
Mr. Nussle.............................. X ....... Mr. Payne...................... ........ X
Mr. Johnson............................. X ....... Mr. Neal....................... ........ X
Ms. Dunn................................ ........ ....... Mr. McNulty.................... ........ X
Mr. Collins............................. X ....... ............................... ........ ........
Mr. Portman............................. X ....... ............................... ........ ........
Mr. Hayes............................... X ....... ............................... ........ ........
Mr. Laughlin............................ ........ ....... ............................... ........ ........
Mr. English............................. X ....... ............................... ........ ........
Mr. Ensign.............................. X ....... ............................... ........ ........
Mr. Christensen......................... X ....... ............................... ........ ........
----------------------------------------------------------------------------------------------------------------
On this vote, Ms. Dunn was unavoidably delayed; had she
been present, she would have voted aye.
IV. BUDGET EFFECTS OF THE BILL
A. Committee Estimate of Budgetary Effect
In compliance with clause 7(a) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the effects on the budget of the bill, H.R. 2754, as
reported.
The bill, as amended, is estimated to have the following
effects on the budget for fiscal years 1996-2002:
ESTIMATED REVENUE EFFECTS OF AN AMENDMENT IN THE NATURE OF A SUBSTITUTE FOR H.R. 2754, THE ``SHIPBUILDING TRADE AGREEMENT ACT'' SCHEDULED FOR WAYS AND
MEANS MARKUP ON THURSDAY, MARCH 21, 1996; FISCAL YEARS 1996-2002
[In millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Provision Effective 1996 1997 1998 1999 2000 2001 2002 1996-00 1996-02
--------------------------------------------------------------------------------------------------------------------------------------------------------
1. H.R. 2754\1\................................................. (\2\) -2 -10 -12 -7 -4 -9 -6 -35 -50
2. Shipping income reporting, with potential exemption denial
and resourcing................................................. (\3\) ...... 3 6 12 15 15 14 36 65
---------------------------------------------------------------------------------------
Net totals................................................ .......... -2 -7 -6 5 11 6 8 1 15
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note. Details may not add to totals due to rounding.
\1\ Estimate provided by the Congressional Budget Office.
\2\ Assumed to be effective 7/15/96.
\3\ Effective years beginning after the later of the date H.R. 2754 takes effect or 12/31/96.
B. Statement Regarding New Budget Authority and Tax Expenditures
In compliance with clause 2(l)(3)(B) of rule XI of the
Rules of the House of Representatives, the Committee states
that the bill does not provide new budget, spending, or credit
authority. Section 201 of the bill provides for a decrease in
revenues, but this decrease is offset by revenue gains in
section 301.
C. Cost Estimate Prepared by the Congressional Budget Office
Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of
the House of Representatives requiring a cost estimate prepared
by the Congressional Budget Office (CBO), the following report
by CBO is provided.
U.S. Congress,
Congressional Budget Office,
Washington, DC, March 26, 1996.
Hon. Bill Archer,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
reviewed H.R. 2754, the Shipbuilding Trade Agreement Act, as
amended and ordered reported by the Committee on Ways and Means
on March 21, 1996. CBO and JCT estimate that H.R. 2754 would
decrease governmental receipts by $2 million in fiscal year
1996 and increase governmental receipts by $15 million over
fiscal years 1996-2002. H.R. 2754 contains no private sector or
intergovernmental mandates as defined in Public Law 104-4 and
would impose no direct costs on state, local, or tribal
governments.
The OECD Shipbuilding Trade Agreement was signed on
December 21, 1994, by the following countries: The Commission
of the European Communities including the United Kingdom,
Germany, France, Italy, Spain, Ireland, the Netherlands,
Belgium, Luxembourg, Greece, Portugal, Denmark, Austria, Sweden
and Finland; Japan; South Korea; Norway; and the United States.
Under current law (19 USC 1466), US flag vessels are subject to
a 50 percent ad valorem duty on the cost of equipment and
nonemergency repairs obtained in foreign countries. As mandated
by the OECD agreement, section 201 of the proposed legislation
would partially repeal the duty by exempting repairs to US flag
vessels done in OECD signatory countries.
CBO estimates that section 201 of the bill, pertaining to
vessel repair duties, would decrease governmental receipts by
$2 million in fiscal year 1996 and by $50 million over the
fiscal years 1996-2002, net of payroll and income tax offsets.
The estimate of revenue loss is based on the historical
collections. Over the past several years, collections have been
between $15 million and $25 million annually. According to the
US Maritime Administration (MARAD), in December 1995 there were
141 vessels in the US flag fleet. However, MARAD predicts a
steady decline in the size of the US fleet due to the impending
expiration and expected termination of the operating-
differential subsidy program, through which payments are made
to US vessels on specified trade routes. This estimate assumes
that future collections of the vessel repair duty would decline
as a result of this reduction in the size of the fleet.
Currently about half of all repairs on US vessels in
foreign ports are performed in OECD signatory countries. If
section 201 of the bill is enacted, CBO assumes that additional
US vessel repairs would be diverted to ports in OECD countries
to take advantage of the duty-free repair treatment. This
estimate assumes that this provision will be effective on July
15, 1996.
Section 301 of the bill expands penalties for failure to
satisfy the filing requirements for claiming the exemption from
US tax that is available to certain foreign persons with
respect to income from international operation of ships. The
Joint Committee on Taxation estimates that this provision would
increase governmental receipts by $3 million in fiscal year
1997 and by $65 million over fiscal years 1996-2002. CBO
concurs with this estimate.
REVENUE EFFECTS OF H.R. 2754
[By fiscal year, in billions of dollars]
----------------------------------------------------------------------------------------------------------------
1996 1997 1998 1999 2000 2001 2002
----------------------------------------------------------------------------------------------------------------
Projected revenues under current
law \1\........................... 1417.581 1475.165 1546.076 1617.969 1697.155 1786.356 1879.335
Proposed changes:
Section 201.................... -0.002 -0.010 -0.012 -0.007 -0.004 -0.009 -0.006
Section 301.................... 0.000 0.003 0.006 0.012 0.015 0.015 0.014
----------------------------------------------------------------------------
Total........................ -0.002 -0.007 -0.006 0.005 0.011 0.006 0.008
Projected revenues under H.R. 2754. 1417.579 1475.158 1546.070 1617.974 1697.166 1786.362 1879.343
----------------------------------------------------------------------------------------------------------------
\1\ Includes the revenue effects of P.L. 104-7 (H.R. 831), and P.L. 104-117 (H.R. 2778).
Section 252 of the Balanced Budget and Emergency Deficit
Control Act of 1985 sets up pay-as-you-go procedures for
legislation affecting receipts or direct spending through 1998.
Because this bill would affect receipts, pay-as-you-go
procedures would apply. These effects are summarized in the
table below.
PAY-AS-YOU-GO CONSIDERATIONS
[By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
1996 1997 1998
----------------------------------------------------------------------------------------------------------------
Changes in receipts.......................................... -2 -7 -6
Changes in outlays...........................................
(2) Not Applicable
----------------------------------------------------------------------------------------------------------------
If you would like further details, please feel free to
contact me or your staff may wish to contact Stephanie Weiner.
Sincerely,
James L. Blum
(For June E. O'Neill, Director).
V. OTHER MATTERS REQUIRED TO BE DISCUSSED UNDER THE RULES OF THE HOUSE
A. Committee Oversight Findings and Recommendations
With respect to subdivision (A) of clause 2(l)(3) of rule
XI of the Rules of the House of Representatives (relating to
oversight findings), the Committee advises that it was as a
result of the Committee's oversight activities concerning
customs and tariff matters, import trade matters, specific
trade-related problems, revenue matters, and the Internal
Revenue Code that the Committee concluded that it was
appropriate to enact the provisions contained in the bill.
B. Summary of Findings and Recommendations of the Committee on
Government Reform and Oversight
With respect to subdivision (D) of clause 2(l)(3) of rule
XI of the Rules of the House of Representatives (relating to
oversight findings), the Committee advises that no oversight
findings or recommendations have been submitted to this
Committee by the Committee on Government Reform and Oversight
with respect to the provisions contained in this bill.
C. Inflationary Impact Statement
In compliance with clause 2(l)(4) of rule XI of the Rules
of the House of Representatives, the Committee states that the
provisions of the bill are not expected to have an overall
inflationary impact on prices and costs in the operation of the
national economy.
VI. CHANGES IN EXISTING LAW MADE BY THE BILL AS REPORTED
In compliance with clause 3 of rule XIII of the Rules of the
House of Representatives, changes in existing law made by the
bill, as reported, are shown as follows (existing law proposed
to be omitted is enclosed in black brackets, new matter is
printed in italics, existing law in which no change is proposed
is shown in roman):
TARIFF ACT OF 1930
* * * * * * *
TITLE IV--ADMINISTRATIVE PROVISIONS
* * * * * * *
Part II--Report, Entry, and Unlading of Vessels and Vehicles
* * * * * * *
SEC. 466. EQUIPMENT AND REPAIRS OF VESSELS
(a) * * *
* * * * * * *
(i) The duty imposed by subsection (a) shall not apply with
respect to activities occurring in a Shipbuilding Agreement
Party, as defined in section 861(22), with respect to--
(1) self-propelled seagoing vessels of 100 gross tons
or more that are used for transportation of goods or
persons or for performance of a specialized service
(including, but not limited to, ice breakers and
dredges), and
(2) tugs of 365 kilowatts or more.
A vessel shall be considered ``self-propelled seagoing'' if its
permanent propulsion and steering provide it all the
characteristics of self-navigability in the high seas.
* * * * * * *
SEC. 468. SHIPBUILDING AGREEMENT COUNTERMEASURES.
(a) In General.--Notwithstanding any other provision of law,
upon receiving from the Secretary of Commerce a list of vessels
subject to countermeasures under section 807, the Customs
Service shall deny any request for a permit to lade or unlade
passengers, merchandise, or baggage from or onto those vessels
so listed.
(b) Exceptions.--Subsection (a) shall not be applied to deny
a permit for the following:
(1) To unlade any United States citizen or permanent
legal resident alien from a vessel included in the list
described in subsection (a), or to unlade any refugee
or any alien who would otherwise be eligible to apply
for asylum and withholding of deportation under the
Immigration and Nationality Act.
(2) To lade or unlade any crewmember of such vessel.
(3) To lade or unlade coal and other fuel supplies
(for the operation of the listed vessel), ships'
stores, sea stores, and the legitimate equipment of
such vessel.
(4) To lade or unlade supplies for the use or sale on
such vessel.
(5) To lade or unlade such other merchandise,
baggage, or passenger as the Customs Service shall
determine necessary to protect the immediate health,
safety, or welfare of a human being.
(c) Correction of Ministerial or Clerical Errors.--
(1) Petition for correction.--If the master of any
vessel whose application for a permit to lade or unlade
has been denied under this section believes that such
denial resulted from a ministerial or clerical error,
not amounting to a mistake of law, committed by any
Customs officer, the master may petition the Customs
Service for correction of such error, as provided by
regulation.
(2) Inapplicability of sections 514 and 520.--
Notwithstanding paragraph (1), imposition of
countermeasures under this section shall not be deemed
an exclusion or other protestable decision under
section 514, and shall not be subject to correction
under section 520.
(3) Petitions seeking administrative review.--Any
petition seeking administrative review of any matter
regarding the Secretary of Commerce's decision to list
a vessel under section 807 must be brought under that
section.
(d) Penalties.--In addition to any other provision of law,
the Customs Service may impose a civil penalty of not to exceed
$10,000 against the master of any vessel--
(1) who submits false information in requesting any
permit to lade or unlade; or
(2) who attempts to, or actually does, lade or unlade
in violation of any denial of such permit under this
section.
* * * * * * *
Part III--Ascertainment, Collection, and Recovery of Duties
* * * * * * *
SEC. 516B. JUDICIAL REVIEW IN INJURIOUS PRICING AND COUNTERMEASURE
PROCEEDINGS.
(a) Review of Determination.--
(1) In general.--Within 30 days after the date of
publication in the Federal Register of--
(A)(i) a determination by the administering
authority under section 802(c) not to initiate
an investigation,
(ii) a negative determination by the
Commission under section 803(a) as to whether
there is or has been reasonable indication of
material injury, threat of material injury, or
material retardation,
(iii) a determination by the administering
authority to suspend or revoke an injurious
pricing order under section 806(d) or (e),
(iv) a determination by the administering
authority under section 807(c),
(v) a determination by the administering
authority in a review under section 807(d),
(vi) a determination by the administering
authority concerning whether to extend the
scope or duration of a countermeasure order
under section 807(e)(3)(B)(ii),
(vii) a determination by the administering
authority to amend a countermeasure order under
section 807(e)(6),
(viii) a determination by the administering
authority in a review under section 807(g),
(ix) a determination by the administering
authority under section 807(i) to terminate
proceedings, or to amend or revoke a
countermeasure order,
(x) a determination by the administering
authority under section 845(b), with respect to
a matter described in paragraph (1)(D) of that
section, or
(B)(i) an injurious pricing order based on a
determination described in subparagraph (A) of
paragraph (2),
(ii) notice of a determination described in
subparagraph (B) of paragraph (2),
(iii) notice of implementation of a
determination described in subparagraph (C) of
paragraph (2), or
(iv) notice of revocation of an injurious
pricing order based on a determination
described in subparagraph (D) of paragraph (2),
an interested party who is a party to the proceeding in
connection with which the matter arises may commence an
action in the United States Court of International
Trade by filing concurrently a summons and complaint,
each with the content and in the form, manner, and
style prescribed by the rules of that court, contesting
any factual findings or legal conclusions upon which
the determination is based.
(2) Reviewable determinations.--The determinations
referred to in paragraph (1)(B) are--
(A) a final affirmative determination by the
administering authority or by the Commission
under section 805, including any negative part
of such a determination (other than a part
referred to in subparagraph (B)),
(B) a final negative determination by the
administering authority or the Commission under
section 805,
(C) a determination by the administering
authority under section 845(b), with respect to
a matter described in paragraph (1)(A) of that
section, and
(D) a determination by the Commission under
section 845(a) that results in the revocation
of an injurious pricing order.
(3) Exception.--Notwithstanding the 30-day limitation
imposed by paragraph (1) with regard to an order
described in paragraph (1)(B)(i), a final affirmative
determination by the administering authority under
section 805 may be contested by commencing an action,
in accordance with the provisions of paragraph (1),
within 30 days after the date of publication in the
Federal Register of a final negative determination by
the Commission under section 805.
(4) Procedures and fees.--The procedures and fees set
forth in chapter 169 of title 28, United States Code,
apply to an action under this section.
(b) Standards of Review.--
(1) Remedy.--The court shall hold unlawful any
determination, finding, or conclusion found--
(A) in an action brought under subparagraph
(A) of subsection (a)(1), to be arbitrary,
capricious, an abuse of discretion, or
otherwise not in accordance with law, or
(B) in an action brought under subparagraph
(B) of subsection (a)(1), to be unsupported by
substantial evidence on the record, or
otherwise not in accordance with law.
(2) Record for review.--
(A) In general.--For purposes of this
subsection, the record, unless otherwise
stipulated by the parties, shall consist of--
(i) a copy of all information
presented to or obtained by the
administering authority or the
Commission during the course of the
administrative proceeding, including
all governmental memoranda pertaining
to the case and the record of ex parte
meetings required to be kept by section
843(a)(2); and
(ii) a copy of the determination, all
transcripts or records of conferences
or hearings, and all notices published
in the Federal Register.
(B) Confidential or privileged material.--The
confidential or privileged status accorded to
any documents, comments, or information shall
be preserved in any action under this section.
Notwithstanding the preceding sentence, the
court may examine, in camera, the confidential
or privileged material, and may disclose such
material under such terms and conditions as it
may order.
(c) Standing.--Any interested party who was a party to the
proceeding under title VIII shall have the right to appear and
be heard as a party in interest before the United States Court
of International Trade in an action under this section. The
party filing the action shall notify all such interested
parties of the filing of an action under this section, in the
form, manner, and within the time prescribed by rules of the
court.
(d) Definitions.--For purposes of this section:
(1) Administering authority.--The term
``administering authority'' has the meaning given that
term in section 861(1).
(2) Commission.--The term ``Commission'' means the
United States International Trade Commission.
(3) Interested party.--The term ``interested party''
means any person described in section 861(17).
* * * * * * *
TITLE VIII--INJURIOUS PRICING AND COUNTERMEASURES RELATING TO
SHIPBUILDING
Subtitle A--Injurious Pricing Charge and Countermeasures
Sec. 801. Injurious pricing charge.
Sec. 802. Procedures for initiating an injurious pricing
investigation.
Sec. 803. Preliminary determinations.
Sec. 804. Termination or suspension of investigation.
Sec. 805. Final determinations.
Sec. 806. Imposition and collection of injurious pricing charge.
Sec. 807. Imposition of countermeasures.
Sec. 808. Injurious pricing petitions by third countries.
Subtitle B--Special Rules
Sec. 821. Export price.
Sec. 822. Normal value.
Sec. 823. Currency conversion.
Subtitle C--Procedures
Sec. 841. Hearings.
Sec. 842. Determinations on the basis of the facts available.
Sec. 843. Access to information.
Sec. 844. Conduct of investigations.
Sec. 845. Administrative action following shipbuilding agreement
panel reports.
Subtitle D--Definitions
Sec. 861. Definitions.
Subtitle A--Injurious Pricing Charge and Countermeasures
SEC. 801. INJURIOUS PRICING CHARGE.
(a) Basis for Charge.--If--
(1) the administering authority determines that a
foreign vessel has been sold directly or indirectly to
one or more United States buyers at less than its fair
value, and
(2) the Commission determines that--
(A) an industry in the United States--
(i) is or has been materially
injured, or
(ii) is threatened with material
injury, or
(B) the establishment of an industry in the
United States is or has been materially
retarded,
by reason of the sale of such vessel, then there shall
be imposed upon the foreign producer of the subject
vessel an injurious pricing charge, in an amount equal
to the amount by which the normal value exceeds the
export price for the vessel. For purposes of this
subsection and section 805(b)(1), a reference to the
sale of a foreign vessel includes the creation or
transfer of an ownership interest in the vessel, except
for an ownership interest created or acquired solely
for the purpose of providing security for a normal
commercial loan.
(b) Foreign Vessels Not Merchandise.--No foreign vessel may
be considered to be, or to be part of, a class or kind of
merchandise for purposes of subtitle B of title VII.
SEC. 802. PROCEDURES FOR INITIATING AN INJURIOUS PRICING INVESTIGATION.
(a) Initiation by Administering Authority.--
(1) General rule.--Except in the case in which
subsection (d)(6) applies, an injurious pricing
investigation shall be initiated whenever the
administering authority determines, from information
available to it, that a formal investigation is
warranted into the question of whether the elements
necessary for the imposition of a charge under section
801(a) exist, and whether a producer described in
section 861(17)(C) would meet the criteria of
subsection (b)(1)(B) for a petitioner.
(2) Time for initiation by administering authority.--
An investigation may only be initiated under paragraph
(1) within 6 months after the time the administering
authority first knew or should have known of the sale
of the vessel. Any period in which subsection (d)(6)(A)
applies shall not be included in calculating that 6-
month period.
(b) Initiation by Petition.--
(1) Petition requirements.--(A) Except in a case in
which subsection (d)(6) applies, an injurious pricing
proceeding shall be initiated whenever an interested
party, as defined in subparagraph (C), (D), (E), or (F)
of section 861(17), files a petition with the
administering authority, on behalf of an industry,
which alleges the elements necessary for the imposition
of an injurious pricing charge under section 801(a) and
the elements required under subparagraph (B), (C), (D),
or (E) of this paragraph, and which is accompanied by
information reasonably available to the petitioner
supporting those allegations and identifying the
transaction concerned.
(B)(i) If the petitioner is a producer described in
section 861(17)(C), and--
(I) if the vessel was sold through a broad
multiple bid, the petition shall include
information indicating that the petitioner was
invited to tender a bid on the contract at
issue, the petitioner actually did so, and the
bid of the petitioner substantially met the
delivery date and technical requirements of the
bid,
(II) if the vessel was sold through any
bidding process other than a broad multiple bid
and the petitioner was invited to tender a bid
on the contract at issue, the petition shall
include information indicating that the
petitioner actually did so and the bid of the
petitioner substantially met the delivery date
and technical requirements of the bid, or
(III) except in a case in which the vessel
was sold through a broad multiple bid, if there
is no invitation to tender a bid, the petition
shall include information indicating that the
petitioner was capable of building the vessel
concerned and, if the petitioner knew or should
have known of the proposed purchase, it made
demonstrable efforts to conclude a sale with
the United States buyer consistent with the
delivery date and technical requirements of the
buyer.
(ii) For purposes of clause (i)(III), there is a
rebuttable presumption that the petitioner knew or
should have known of the proposed purchase if it is
demonstrated that--
(I) the majority of the producers in the
industry have made efforts with the United
States buyer to conclude a sale of the subject
vessel, or
(II) general information on the sale was
available from brokers, financiers,
classification societies, charterers, trade
associations, or other entities normally
involved in shipbuilding transactions with whom
the petitioner had regular contacts or
dealings.
(C) If the petitioner is an interested party
described in section 861(17)(D), the petition shall
include information indicating that members of the
union or group of workers described in that section are
employed by a producer that meets the requirements of
subparagraph (B) of this paragraph.
(D) If the petitioner is an interested party
described in section 861(17)(E), the petition shall
include information indicating that a member of the
association described in that section is a producer
that meets the requirements of subparagraph (B) of this
paragraph.
(E) If the petitioner is an interested party
described in section 861(17)(F), the petition shall
include information indicating that a member of the
association described in that section meets the
requirements of subparagraph (C) or (D) of this
paragraph.
(F) The petition may be amended at such time, and
upon such conditions, as the administering authority
and the Commission may permit.
(2) Simultaneous filing with commission.--The
petitioner shall file a copy of the petition with the
Commission on the same day as it is filed with the
administering authority.
(3) Deadline for filing petition.--
(A) Deadline.--(i) A petitioner to which
paragraph (1)(B) (i) or (ii) applies shall file
the petition no later than the earlier of--
(I) 6 months after the time that the
petitioner first knew or should have
known of the sale of the subject
vessel, or
(II) 6 months after delivery of the
subject vessel.
(ii) A petitioner to which paragraph
(1)(B)(iii) applies shall--
(I) file the petition no later than
the earlier of 9 months after the time
that the petitioner first knew or
should have known of the sale of the
subject vessel, or 6 months after
delivery of the subject vessel, and
(II) submit to the administering
authority a notice of intent to file a
petition no later than 6 months after
the time that the petitioner first knew
or should have known of the sale
(unless the petition itself is filed
within that 6-month period).
(B) Presumption of knowledge.--For purposes
of this paragraph, if the existence of the
sale, together with general information
concerning the vessel, is published in the
international trade press, there is a
rebuttable presumption that the petitioner knew
or should have known of the sale of the vessel
from the date of that publication.
(c) Actions Before Initiating Investigations.--
(1) Notification of governments.--Before initiating
an investigation under either subsection (a) or (b),
the administering authority shall notify the government
of the exporting country of the investigation. In the
case of the initiation of an investigation under
subsection (b), such notification shall include a
public version of the petition.
(2) Acceptance of communications.--The administering
authority shall not accept any unsolicited oral or
written communication from any person other than an
interested party described in section 861(17)(C), (D),
(E), or (F) before the administering authority makes
its decision whether to initiate an investigation
pursuant to a petition, except for inquiries regarding
the status of the administering authority's
consideration of the petition or a request for
consultation by the government of the exporting
country.
(3) Nondisclosure of certain information.--The
administering authority and the Commission shall not
disclose information with regard to any draft petition
submitted for review and comment before it is filed
under subsection (b)(1).
(d) Petition Determination.--
(1) Time for initial determination.--(A) Within 45
days after the date on which a petition is filed under
subsection (b), the administering authority shall,
after examining, on the basis of sources readily
available to the administering authority, the accuracy
and adequacy of the evidence provided in the petition,
determine whether the petition--
(i) alleges the elements necessary for the
imposition of an injurious pricing charge under
section 801(a) and the elements required under
subsection (b)(1)(B), (C), (D), or (E), and
contains information reasonably available to
the petitioner supporting the allegations; and
(ii) determine if the petition has been filed
by or on behalf of the industry.
(B) Any period in which paragraph (6)(A) applies
shall not be included in calculating the 45-day period
described in subparagraph (A).
(2) Affirmative determinations.--If the
determinations under clauses (i) and (ii) of paragraph
(1)(A) are affirmative, the administering authority
shall initiate an investigation to determine whether
the vessel was sold at less than fair value, unless
paragraph (6) applies.
(3) Negative determinations.--If--
(A) the determination under clause (i) or
(ii) of paragraph (1)(A) is negative, or
(B) paragraph (6)(B) applies,
the administering authority shall dismiss the petition,
terminate the proceeding, and notify the petitioner in
writing of the reasons for the determination.
(4) Determination of industry support.--
(A) General rule.--For purposes of this
subsection, the administering authority shall
determine that the petition has been filed by
or on behalf of the domestic industry, if--
(i) the domestic producers or workers
who support the petition collectively
account for at least 25 percent of the
total capacity of domestic producers
capable of producing a like vessel, and
(ii) the domestic producers or
workers who support the petition
collectively account for more than 50
percent of the total capacity to
produce a like vessel of that portion
of the domestic industry expressing
support for or opposition to the
petition.
(B) Certain positions disregarded.--In
determining industry support under subparagraph
(A), the administering authority shall
disregard the position of domestic producers
who oppose the petition, if such producers are
related to the foreign producer or United
States buyer of the subject vessel, or the
domestic producer is itself the United States
buyer, unless such domestic producers
demonstrate that their interests as domestic
producers would be adversely affected by the
imposition of an injurious pricing charge.
(C) Polling the industry.--If the petition
does not establish support of domestic
producers or workers accounting for more than
50 percent of the total capacity to produce a
like vessel--
(i) the administering authority shall
poll the industry or rely on other
information in order to determine if
there is support for the petition as
required by subparagraph (A), or
(ii) if there is a large number of
producers in the industry, the
administering authority may determine
industry support for the petition by
using any statistically valid sampling
method to poll the industry.
(D) Comments by interested parties.--Before
the administering authority makes a
determination with respect to initiating an
investigation, any person who would qualify as
an interested party under section 861(17) if an
investigation were initiated, may submit
comments or information on the issue of
industry support. After the administering
authority makes a determination with respect to
initiating an investigation, the determination
regarding industry support shall not be
reconsidered.
(5) Definition of domestic producers or workers.--For
purposes of this subsection, the term ``domestic
producers or workers'' means interested parties as
defined in section 861(17)(C), (D), (E), or (F).
(6) Proceedings by wto members.--The administering
authority shall not initiate an investigation under
this section if, with respect to the vessel sale at
issue, an antidumping proceeding conducted by a WTO
member who is not a Shipbuilding Agreement Party--
(A) has been initiated and has been pending
for not more than one year, or
(B) has been completed and resulted in the
imposition of antidumping measures or a
negative determination with respect to whether
the sale was at less than fair value or with
respect to injury.
(e) Notification to Commission of Determination.--The
administering authority shall--
(1) notify the Commission immediately of any
determination it makes under subsection (a) or (d), and
(2) if the determination is affirmative, make
available to the Commission such information as it may
have relating to the matter under investigation, under
such procedures as the administering authority and the
Commission may establish to prevent disclosure, other
than with the consent of the party providing it or
under protective order, of any information to which
confidential treatment has been given by the
administering authority.
SEC. 803. PRELIMINARY DETERMINATIONS.
(a) Determination by Commission of Reasonable Indication of
Injury.--
(1) General rule.--Except in the case of a petition
dismissed by the administering authority under section
802(d)(3), the Commission, within the time specified in
paragraph (2), shall determine, based on the
information available to it at the time of the
determination, whether there is a reasonable indication
that--
(A) an industry in the United States--
(i) is or has been materially
injured, or
(ii) is threatened with material
injury, or
(B) the establishment of an industry in the
United States is or has been materially
retarded,
by reason of the sale of the subject vessel. If the
Commission makes a negative determination under this
paragraph, the investigation shall be terminated.
(2) Time for commission determination.--The
Commission shall make the determination described in
paragraph (1) within 90 days after the date on which
the petition is filed or, in the case of an
investigation initiated under section 802(a), within 90
days after the date on which the Commission receives
notice from the administering authority that the
investigation has been initiated.
(b) Preliminary Determination by Administering Authority.--
(1) Period of injurious pricing investigation.--(A)
The administering authority shall make a determination,
based upon the information available to it at the time
of the determination, of whether there is a reasonable
basis to believe or suspect that the subject vessel was
sold at less than fair value.
(B) If cost data is required to determine normal
value on the basis of a sale of a foreign like vessel
that has not been delivered on or before the date on
which the administering authority initiates the
investigation, the administering authority shall make
its determination within 160 days after the date of
delivery of the foreign like vessel.
(C) If normal value is to be determined on the basis
of constructed value, the administering authority shall
make its determination within 160 days after the date
of delivery of the subject vessel.
(D) In cases in which subparagraph (B) or (C) does
not apply, the administering authority shall make its
determination within 160 days after the date on which
the administering authority initiates the investigation
under section 802.
(E) In no event shall the administering authority
make its determination before an affirmative
determination is made by the Commission under
subsection (a).
(2) De minimis injurious pricing margin.--In making a
determination under this subsection, the administering
authority shall disregard any injurious pricing margin
that is de minimis. For purposes of the preceding
sentence, an injurious pricing margin is de minimis if
the administering authority determines that the margin
is less than 2 percent of the export price.
(c) Extension of Period in Extraordinarily Complicated Cases
or for Good Cause.--
(1) In general.--If--
(A) the administering authority concludes
that the parties concerned are cooperating and
determines that--
(i) the case is extraordinarily
complicated by reason of--
(I) the novelty of the issues
presented, or
(II) the nature and extent of
the information required, and
(ii) additional time is necessary to
make the preliminary determination, or
(B) a party to the investigation requests an
extension and demonstrates good cause for the
extension,
then the administering authority may postpone the time
for making its preliminary determination.
(2) Length of postponement.--The preliminary
determination may be postponed under paragraph (1)(A)
or (B) until not later than the 190th day after--
(A) the date of delivery of the foreign like
vessel, if subsection (b)(1)(B) applies,
(B) the date of delivery of the subject
vessel, if subsection (b)(1)(C) applies, or
(C) the date on which the administering
authority initiates an investigation under
section 802, in a case in which subsection
(b)(1)(D) applies.
(3) Notice of postponement.--The administering
authority shall notify the parties to the
investigation, not later than 20 days before the date
on which the preliminary determination would otherwise
be required under subsection (b)(1), if it intends to
postpone making the preliminary determination under
paragraph (1). The notification shall include an
explanation of the reasons for the postponement, and
notice of the postponement shall be published in the
Federal Register.
(d) Effect of Determination by the Administering Authority.--
If the preliminary determination of the administering authority
under subsection (b) is affirmative, the administering
authority shall--
(1) determine an estimated injurious pricing margin,
and
(2) make available to the Commission all information
upon which its determination was based and which the
Commission considers relevant to its injury
determination, under such procedures as the
administering authority and the Commission may
establish to prevent disclosure, other than with the
consent of the party providing it or under protective
order, of any information to which confidential
treatment has been given by the administering
authority.
(e) Notice of Determination.--Whenever the Commission or the
administering authority makes a determination under this
section, the Commission or the administering authority, as the
case may be, shall notify the petitioner, and other parties to
the investigation, and the Commission or the administering
authority (whichever is appropriate) of its determination. The
administering authority shall include with such notification
the facts and conclusions on which its determination is based.
Not later than 5 days after the date on which the determination
is required to be made under subsection (a)(2), the Commission
shall transmit to the administering authority the facts and
conclusions on which its determination is based.
SEC. 804. TERMINATION OR SUSPENSION OF INVESTIGATION.
(a) Termination of Investigation Upon Withdrawal of
Petition.--
(1) In general.--Except as provided in paragraph (2),
an investigation under this subtitle may be terminated
by either the administering authority or the
Commission, after notice to all parties to the
investigation, upon withdrawal of the petition by the
petitioner.
(2) Limitation on termination by commission.--The
Commission may not terminate an investigation under
paragraph (1) before a preliminary determination is
made by the administering authority under section
803(b).
(b) Termination of Investigations Initiated by Administering
Authority.--The administering authority may terminate any
investigation initiated by the administering authority under
section 802(a) after providing notice of such termination to
all parties to the investigation.
(c) Alternate Equivalent Remedy.--The criteria set forth in
subparagraphs (A) through (D) of section 806(e)(1) shall apply
to any agreement that forms the basis for termination of an
investigation under subsection (a) or (b).
(d) Proceedings by WTO Members.--
(1) Suspension of investigation.--The administering
authority and the Commission shall suspend an
investigation under this section if a WTO member that
is not a Shipbuilding Agreement Party initiates an
antidumping proceeding described in section 861(29)(A)
with respect to the sale of the subject vessel.
(2) Termination of investigation.--If an antidumping
proceeding described in paragraph (1) is concluded by--
(A) the imposition of antidumping measures,
or
(B) a negative determination with respect to
whether the sale is at less than fair value or
with respect to injury,
the administering authority and the Commission shall
terminate the investigation under this section.
(3) Continuation of investigation.--(A) If such a
proceeding--
(i) is concluded by a result other than a
result described in paragraph (2), or
(ii) is not concluded within one year from
the date of the initiation of the proceeding,
then the administering authority and the Commission
shall terminate the suspension and continue the
investigation. The period in which the investigation
was suspended shall not be included in calculating
deadlines applicable with respect to the investigation.
(B) Notwithstanding subparagraph (A)(ii), if the
proceeding is concluded by a result described in
paragraph (2)(A), the administering authority and the
Commission shall terminate the investigation under this
section.
SEC. 805. FINAL DETERMINATIONS.
(a) Determinations by Administering Authority.--
(1) In general.--Within 75 days after the date of its
preliminary determination under section 803(b), the
administering authority shall make a final
determination of whether the vessel which is the
subject of the investigation has been sold in the
United States at less than its fair value.
(2) Extension of period for determination.--(A) The
administering authority may postpone making the final
determination under paragraph (1) until not later than
290 days after--
(i) the date of delivery of the foreign like
vessel, in an investigation to which section
803(b)(1)(B) applies,
(ii) the date of delivery of the subject
vessel, in an investigation to which section
803(b)(1)(C) applies, or
(iii) the date on which the administering
authority initiates the investigation under
section 802, in an investigation to which
section 803(b)(1)(D) applies.
(B) The administering authority may apply
subparagraph (A) if a request in writing is made by--
(i) the producer of the subject vessel, in a
proceeding in which the preliminary
determination by the administering authority
under section 803(b) was affirmative, or
(ii) the petitioner, in a proceeding in which
the preliminary determination by the
administering authority under section 803(b)
was negative.
(3) De minimis injurious pricing margin.--In making a
determination under this subsection, the administering
authority shall disregard any injurious pricing margin
that is de minimis as defined in section 803(b)(2).
(b) Final Determination by Commission.--
(1) In general.--The Commission shall make a final
determination of whether--
(A) an industry in the United States--
(i) is or has been materially
injured, or
(ii) is threatened with material
injury, or
(B) the establishment of an industry in the
United States is or has been materially
retarded,
by reason of the sale of the vessel with respect to
which the administering authority has made an
affirmative determination under subsection (a)(1).
(2) Period for injury determination following
affirmative preliminary determination by administering
authority.--If the preliminary determination by the
administering authority under section 803(b) is
affirmative, then the Commission shall make the
determination required by paragraph (1) before the
later of--
(A) the 120th day after the day on which the
administering authority makes its affirmative
preliminary determination under section 803(b),
or
(B) the 45th day after the day on which the
administering authority makes its affirmative
final determination under subsection (a).
(3) Period for injury determination following
negative preliminary determination by administering
authority.--If the preliminary determination by the
administering authority under section 803(b) is
negative, and its final determination under subsection
(a) is affirmative, then the final determination by the
Commission under this subsection shall be made within
75 days after the date of that affirmative final
determination.
(c) Effect of Final Determinations.--
(1) Effect of affirmative determination by the
administering authority.--If the determination of the
administering authority under subsection (a) is
affirmative, then the administering authority shall--
(A) make available to the Commission all
information upon which such determination was
based and which the Commission considers
relevant to its determination, under such
procedures as the administering authority and
the Commission may establish to prevent
disclosure, other than with the consent of the
party providing it or under protective order,
of any information to which confidential
treatment has been given by the administering
authority, and
(B) calculate an injurious pricing charge in
an amount equal to the amount by which the
normal value exceeds the export price of the
subject vessel.
(2) Issuance of order; effect of negative
determination.--If the determinations of the
administering authority and the Commission under
subsections (a)(1) and (b)(1) are affirmative, then the
administering authority shall issue an injurious
pricing order under section 806. If either of such
determinations is negative, the investigation shall be
terminated upon the publication of notice of that
negative determination.
(d) Publication of Notice of Determinations.--Whenever the
administering authority or the Commission makes a determination
under this section, it shall notify the petitioner, other
parties to the investigation, and the other agency of its
determination and of the facts and conclusions of law upon
which the determination is based, and it shall publish notice
of its determination in the Federal Register.
(e) Correction of Ministerial Errors.--The administering
authority shall establish procedures for the correction of
ministerial errors in final determinations within a reasonable
time after the determinations are issued under this section.
Such procedures shall ensure opportunity for interested parties
to present their views regarding any such errors. As used in
this subsection, the term ``ministerial error'' includes errors
in addition, subtraction, or other arithmetic function,
clerical errors resulting from inaccurate copying, duplication,
or the like, and any other type of unintentional error which
the administering authority considers ministerial.
SEC. 806. IMPOSITION AND COLLECTION OF INJURIOUS PRICING CHARGE.
(a) In General.--Within 10 days after being notified by the
Commission of an affirmative determination under section
805(b), the administering authority shall publish an order
imposing an injurious pricing charge on the foreign producer of
the subject vessel which--
(1) directs the foreign producer of the subject
vessel to pay to the Secretary of the Treasury, or the
designee of the Secretary, within 180 days from the
date of publication of the order, an injurious pricing
charge in an amount equal to the amount by which the
normal value exceeds the export price of the subject
vessel,
(2) includes the identity and location of the foreign
producer and a description of the subject vessel, in
such detail as the administering authority deems
necessary, and
(3) informs the foreign producer that--
(A) failure to pay the injurious pricing
charge in a timely fashion may result in the
imposition of countermeasures with respect to
that producer under section 807,
(B) payment made after the deadline described
in paragraph (1) shall be subject to interest
charges at the Commercial Interest Reference
Rate (CIRR), and
(C) the foreign producer may request an
extension of the due date for payment under
subsection (b).
(b) Extension of Due Date for Payment in Extraordinary
Circumstances.--
(1) Extension.--Upon request, the administering
authority may amend the order under subsection (a) to
set a due date for payment or payments later than the
date that is 180 days from the date of publication of
the order, if the administering authority determines
that full payment in 180 days would render the producer
insolvent or would be incompatible with a judicially
supervised reorganization. When an extended payment
schedule provides for a series of partial payments, the
administering authority shall specify the circumstances
under which default on one or more payments will result
in the imposition of countermeasures.
(2) Interest charges.--If a request is granted under
paragraph (1), payments made after the date that is 180
days from the publication of the order shall be subject
to interest charges at the CIRR.
(c) Notification of Order.--The administering authority shall
deliver a copy of the order requesting payment to the foreign
producer of the subject vessel and to an appropriate
representative of the government of the exporting country.
(d) Revocation of Order.--The administering authority--
(1) may revoke an injurious pricing order if the
administering authority determines that producers
accounting for substantially all of the capacity to
produce a domestic like vessel have expressed a lack of
interest in the order, and
(2) shall revoke an injurious pricing order--
(A) if the sale of the vessel that was the
subject of the injurious pricing determination
is voided,
(B) if the injurious pricing charge is paid
in full, including any interest accrued for
late payment,
(C) upon full implementation of an
alternative equivalent remedy described in
subsection (e), or
(D) if, with respect to the vessel sale that
was at issue in the investigation that resulted
in the injurious pricing order, an antidumping
proceeding conducted by a WTO member who is not
a Shipbuilding Agreement Party has been
completed and resulted in the imposition of
antidumping measures.
(e) Alternative Equivalent Remedy.--
(1) Agreement for alternate remedy.--The
administering authority may suspend an injurious
pricing order if the administering authority enters
into an agreement with the foreign producer subject to
the order on an alternative equivalent remedy, that the
administering authority determines--
(A) is at least as effective a remedy as the
injurious pricing charge,
(B) is in the public interest,
(C) can be effectively monitored and
enforced, and
(D) is otherwise consistent with the domestic
law and international obligations of the United
States.
(2) Prior consultations and submission of comments.--
Before entering into an agreement under paragraph (1),
the administering authority shall consult with the
industry, and provide for the submission of comments by
interested parties, with respect to the agreement.
(3) Material violations of agreement.--If the
injurious pricing order has been suspended under
paragraph (1), and the administering authority
determines that the foreign producer concerned has
materially violated the terms of the agreement under
paragraph (1), the administering authority shall
terminate the suspension.
SEC. 807. IMPOSITION OF COUNTERMEASURES.
(a) General Rule.--
(1) Issuance of order imposing countermeasures.--
Unless an injurious pricing order is revoked or
suspended under section 806 (d) or (e), the
administering authority shall issue an order imposing
countermeasures.
(2) Contents of order.--The countermeasure order
shall--
(A) state that, as provided in section 468, a
permit to lade or unlade passengers or
merchandise may not be issued with respect to
vessels contracted to be built by the foreign
producer of the vessel with respect to which an
injurious pricing order was issued under
section 806, and
(B) specify the scope and duration of the
prohibition on the issuance of a permit to lade
or unlade passengers or merchandise.
(b) Notice of Intent To Impose Countermeasures.--
(1) General rule.--The administering authority shall
issue a notice of intent to impose countermeasures not
later than 30 days before the expiration of the time
for payment specified in the injurious pricing order
(or extended payment provided for under section
806(b)), and shall publish the notice in the Federal
Register within 7 days after issuing the notice.
(2) Elements of the notice of intent.--The notice of
intent shall contain at least the following elements:
(A) Scope.--A permit to lade or unlade
passengers or merchandise may not be issued
with respect to any vessel--
(i) built by the foreign producer
subject to the proposed
countermeasures, and
(ii) with respect to which the
material terms of sale are established
within a period of 4 consecutive years
beginning on the date that is 30 days
after publication in the Fedeal
Register of the notice of intent
described in paragraph (1).
(B) Duration.--For each vessel described in
subparagraph (A), a permit to lade or unlade
passengers or merchandise may not be issued for
a period of 4 years after the date of delivery
of the vessel.
(c) Determination To Impose Countermeasures; Order.--
(1) General rule.--The administering authority shall,
within the time specified in paragraph (2), issue a
determination and order imposing countermeasures.
(2) Time for determination.--The determination shall
be issued within 90 days after the date on which the
notice of intent to impose countermeasures under
subsection (b) is published in the Federal Register.
The administering authority shall publish the
determination, and the order described in paragraph
(4), in the Federal Register within 7 days after
issuing the final determination, and shall provide a
copy of the determination and order to the Customs
Service.
(3) Content of the determination.--In the
determination imposing countermeasures, the
administering authority shall determine whether, in
light of all of the circumstances, an interested party
has demonstrated that the scope or duration of the
countermeasures described in subsection (b)(2) should
be narrower or shorter than the scope or duration set
forth in the notice of intent to impose
countermeasures.
(4) Order.--At the same time it issues its
determination, the administering authority shall issue
an order imposing countermeasures, consistent with its
determination.
(d) Administrative Review of Determination To Impose
Countermeasures.--
(1) Request for review.--Each year, in the
anniversary month of the issuance of the order imposing
countermeasures under subsection (c), the administering
authority shall publish in the Federal Register a
notice providing that interested parties may request--
(A) a review of the scope or duration of the
countermeasures determined under subsection
(c)(3), and
(B) a hearing in connection with such a
review.
(2) Review.--If a proper request has been received
under paragraph (1), the administering authority
shall--
(A) publish notice of initiation of a review
in the Federal Register not later than 15 days
after the end of the anniversary month of the
issuance of the order imposing countermeasures,
and
(B) review and determine whether the
requesting party has demonstrated that the
scope or duration of the countermeasures is
excessive in light of all of the circumstances.
(3) Time for review.--The administering authority
shall make its determination under paragraph (2)(B)
within 90 days after the date on which the notice of
initiation of the review is published. If the
determination under paragraph (2)(B) is affirmative,
the administering authority shall amend the order
accordingly. The administering authority shall promptly
publish the determination and any amendment to the
order in the Federal Register, and shall provide a copy
of any amended order to the Customs Service. In
extraordinary circumstances, the administering
authority may extend the time for its determination
under paragraph (2)(B) to not later than 150 days after
the date on which the notice of initiation of the
review is published.
(e) Extension of Countermeasures.--
(1) Request for extension.--Within the time described
in paragraph (2), an interested party may file with the
administering authority a request that the scope or
duration of countermeasures be extended.
(2) Deadline for request for extension.--
(A) Request for extension beyond 4 years.--If
the request seeks an extension that would cause
the scope or duration of countermeasures to
exceed 4 years, including any prior extensions,
the request for extension under paragraph (1)
shall be filed not earlier than the date that
is 15 months, and not later than the date that
is 12 months, before the date that marks the
end of the period that specifies the vessels
that fall within the scope of the order by
virtue of the establishment of material terms
of sale within that period.
(B) Other requests.--If the request seeks an
extension under paragraph (1) other than one
described in subparagraph (A), the request
shall be filed not earlier than the date that
is 6 months, and not later than a date that is
3 months, before the date that marks the end of
the period referred to in subparagraph (A).
(3) Determination.--
(A) Notice of request for extension.--If a
proper request has been received under
paragraph (1), the administering authority
shall publish notice of initiation of an
extension proceeding in the Federal Register
not later than 15 days after the applicable
deadline in paragraph (2) for requesting the
extension.
(B) Procedures.--
(i) Requests for extension beyond 4
years.--If paragraph (2)(A) applies to
the request, the administering
authority shall consult with the Trade
Representative under paragraph (4).
(ii) Other requests.--If paragraph
(2)(B) applies to the request, the
administering authority shall
determine, within 90 days after the
date on which the notice of initiation
of the proceeding is published, whether
the requesting party has demonstrated
that the scope or duration of the
countermeasures is inadequate in light
of all of the circumstances. If the
administering authority determines that
an extension is warranted, it shall
amend the countermeasure order
accordingly. The administering
authority shall promptly publish the
determination and any amendment to the
order in the Federal Register, and
shall provide a copy of any amended
order to the Customs Service.
(4) Consultation with trade representative.--If
paragraph (3)(B)(i) applies, the administering
authority shall consult with the Trade Representative
concerning whether it would be appropriate to request
establishment of a dispute settlement panel under the
Shipbuilding Agreement for the purpose of seeking
authorization to extend the scope or duration of
countermeasures for a period in excess of 4 years.
(5) Decision not to request panel.--If, based on
consultations under paragraph (4), the Trade
Representative decides not to request establishment of
a panel, the Trade Representative shall inform the
party requesting the extension of the countermeasures
of the reasons for its decision in writing. The
decision shall not be subject to judicial review.
(6) Panel proceedings.--If, based on consultations
under paragraph (4), the Trade Representative requests
the establishment of a panel under the Shipbuilding
Agreement to authorize an extension of the period of
countermeasures, and the panel authorizes such an
extension, the administering authority shall promptly
amend the countermeasure order. The administering
authority shall publish notice of the amendment in the
Federal Register.
(f) List of Vessels Subject to Countermeasures.--
(1) General rule.--At least once during each 12-month
period beginning on the anniversary date of a
determination to impose countermeasures under this
section, the administering authority shall publish in
the Federal Register a list of all delivered vessels
subject to countermeasures under the determination.
(2) Content of list.--The list under paragraph (1)
shall include the following information for each
vessel, to the extent the information is available:
(A) The name and general description of the
vessel.
(B) The vessel identification number.
(C) The shipyard where the vessel was
constructed.
(D) The last-known registry of the vessel.
(E) The name and address of the last-known
owner of the vessel.
(F) The delivery date of the vessel.
(G) The remaining duration of countermeasures
on the vessel.
(H) Any other identifying information
available.
(3) Amendment of list.---The administering authority
may amend the list from time to time to reflect new
information that comes to its attention and shall
publish any amendments in the Federal Register.
(4) Service of list and amendments.--(A) The
administering authority shall serve a copy of the list
described in paragraph (1) on--
(i) the petitioner under section 802(b),
(ii) the United States Customs Service,
(iii) the Secretariat of the Organization for
Economic Cooperation and Development,
(iv) the owners of vessels on the list,
(v) the shipyards on the list, and
(vi) the government of the country in which a
shipyard on the list is located.
(B) The administering authority shall serve a copy of
any amendments to the list under paragraph (3) or
subsection (g)(3) on--
(i) the parties listed in clauses (i), (ii),
and (iii) of subparagraph (A), and,
(ii) if the amendment affects their
interests, the parties listed in clauses (iv),
(v), and (vi) of subparagraph (A).
(g) Administrative Review of List of Vessels Subject to
Countermeasures.--
(1) Request for review.--(A) An interested party may
request in writing a review of the list described in
subsection (f)(1), including any amendments thereto, to
determine whether--
(i) a vessel included in the list does not
fall within the scope of the applicable
countermeasure order and should be deleted, or
(ii) a vessel not included in the list falls
within the scope of the applicable
countermeasure order and should be added.
(B) Any request seeking a determination described in
subparagraph (A)(i) shall be made within 90 days after
the date of publication of the applicable list.
(2) Review.--If a proper request for review has been
received, the administering authority shall--
(A) publish notice of initiation of a review
in the Federal Register--
(i) not later than 15 days after the
request is received, or
(ii) if the request seeks a
determination described in paragraph
(1)(A)(i), not later than 15 days after
the deadline described in paragraph
(1)(B), and
(B) review and determine whether the
requesting party has demonstrated that--
(i) a vessel included in the list
does not qualify for such inclusion, or
(ii) a vessel not included in the
list qualifies for inclusion.
(3) Time for determination.--The administering
authority shall make its determination under paragraph
(2)(B) within 90 days after the date on which the
notice of initiation of such review is published. If
the administering authority determines that a vessel
should be added or deleted from the list, the
administering authority shall amend the list
accordingly. The administering authority shall promptly
publish in the Federal Register the determination and
any such amendment to the list.
(h) Expiration of Countermeasures.--Upon expiration of a
countermeasure order imposed under this section, the
administering authority shall promptly publish a notice of the
expiration in the Federal Register.
(i) Suspension or Termination of Proceedings or
Countermeasures; Temporary Reduction of Countermeasures.--
(1) If injurious pricing order revoked or
suspended.--If an injurious pricing order has been
revoked or suspended under section 806(d) or (e), the
administering authority shall, as appropriate, suspend
or terminate proceedings under this section with
respect to that order, or suspend or revoke a
countermeasure order issued with respect to that
injurious pricing order.
(2) If payment date amended.--(A) Subject to
subparagraph (C), if the payment date under an
injurious pricing order is amended under section 845,
the administering authority shall, as appropriate,
suspend proceedings or modify deadlines under this
section, or suspend or amend a countermeasure order
issued with respect to that injurious pricing order.
(B) In taking action under subparagraph (A), the
administering authority shall ensure that
countermeasures are not applied before the date that is
30 days after publication in the Federal Register of
the amended payment date.
(C) If--
(i) a countermeasure order is issued under
subsection (c) before an amendment is made
under section 845 to the payment date of the
injurious pricing order to which the
countermeasure order applies, and
(ii) the administering authority determines
that the period of time between the original
payment date and the amended payment date is
significant for purposes of determining the
appropriate scope or duration of
countermeasures,
the administering authority may, in lieu of acting
under subparagraph (A), reinstitute proceedings under
subsection (c) for purposes of issuing a new
determination under that subsection.
(j) Comment and Hearing.--In the course of any proceeding
under subsection (c), (d), (e), or (g), the administering
authority--
(1) shall solicit comments from interested parties,
and
(2)(A) in a proceeding under subsection (c) or (d),
upon the request of an interested party, shall hold a
hearing in accordance with section 841(b) in connection
with that proceeding, or
(B) in a proceeding under subsection (e) or (g), upon
the request of an interested party, may hold a hearing
in accordance with section 841(b) in connection with
that proceeding.
SEC. 808. INJURIOUS PRICING PETITIONS BY THIRD COUNTRIES.
(a) Filing of Petition.--The government of a Shipbuilding
Agreement Party may file with the Trade Representative a
petition requesting that an investigation be conducted to
determine if--
(1) a vessel from another Shipbuilding Agreement
Party has been sold in the United States at less than
fair value, and
(2) an industry, in the petitioning country,
producing or capable of producing a like vessel is
materially injured by reason of such sale.
(b) Initiation.--The Trade Representative, after consultation
with the administering authority and the Commission and
obtaining the approval of the Parties Group under the
Shipbuilding Agreement, shall determine whether to initiate an
investigation described in subsection (a).
(c) Determinations.--Upon initiation of an investigation
under subsection (a), the Trade Representative shall request
the following determinations be made in accordance with
substantive and procedural requirements specified by the Trade
Representative, notwithstanding any other provision of this
title:
(1) The administering authority shall determine
whether the subject vessel has been sold at less than
fair value.
(2) The Commission shall determine whether an
industry in the petitioning country is materially
injured by reason of the sale of the subject vessel in
the United States.
(d) Public Comment.--An opportunity for public comment shall
be provided, as appropriate--
(1) by the Trade Representative, in making the
determinations required by subsection (b), and
(2) by the administering authority and the
Commission, in making the determinations required by
subsection (c).
(e) Issuance of Order.--If the administering authority makes
an affirmative determination under paragraph (1) of subsection
(c), and the Commission makes an affirmative determination
under paragraph (2) of subsection (c), the administering
authority shall--
(1) order an injurious pricing charge in accordance
with section 806, and
(2) make such determinations and take such other
actions as are required by sections 806 and 807, as if
affirmative determinations had been made under
subsections (a) and (b) of section 805.
(f) Reviews of Determinations.--For purposes of review under
section 516B, if an order is issued under subsection (e)--
(1) the final determinations of the administering
authority and the Commission under subsection (c) shall
be treated as final determinations made under section
805, and
(2) determinations of the administering authority
under subsection (e)(2) shall be treated as
determinations made under section 806 or 807, as the
case may be.
(g) Access to Information.--Section 843 shall apply to
investigations under this section, to the extent specified by
the Trade Representative, after consultation with the
administering authority and the Commission.
Subtitle B--Special Rules
SEC. 821. EXPORT PRICE.
(a) Export Price.--For purposes of this title, the term
``export price'' means the price at which the subject vessel is
first sold (or agreed to be sold) by or for the account of the
foreign producer of the subject vessel to an unaffiliated
United States buyer. The term ``sold (or agreed to be sold) by
or for the account of the foreign producer'' includes any
transfer of an ownership interest, including by way of lease or
long-term bareboat charter, in conjunction with the original
transfer from the producer, either directly or indirectly, to a
United States buyer.
(b) Adjustments to Export Price.--The price used to establish
export price shall be--
(1) increased by the amount of any import duties
imposed by the country of exportation which have been
rebated, or which have not been collected, by reason of
the exportation of the subject vessel, and
(2) reduced by--
(A) the amount, if any, included in such
price, attributable to any additional costs,
charges, or expenses which are incident to
bringing the subject vessel from the shipyard
in the exporting country to the place of
delivery,
(B) the amount, if included in such price, of
any export tax, duty, or other charge imposed
by the exporting country on the exportation of
the subject vessel, and
(C) all other expenses incidental to placing
the vessel in condition for delivery to the
buyer.
SEC. 822. NORMAL VALUE.
(a) Determination.--In determining under this title whether a
subject vessel has been sold at less than fair value, a fair
comparison shall be made between the export price and normal
value of the subject vessel. In order to achieve a fair
comparison with the export price, normal value shall be
determined as follows:
(1) Determination of normal value.--
(A) In general.--The normal value of the
subject vessel shall be the price described in
subparagraph (B), at a time reasonably
corresponding to the time of the sale used to
determine the export price under section
821(a).
(B) Price.--The price referred to in
subparagraph (A) is--
(i) the price at which a foreign like
vessel is first sold in the exporting
country, in the ordinary course of
trade and, to the extent practicable,
at the same level of trade, or
(ii) in a case to which subparagraph
(C) applies, the price at which a
foreign like vessel is so sold for
consumption in a country other than the
exporting country or the United States,
if--
(I) such price is
representative, and
(II) the administering
authority does not determine
that the particular market
situation in such other country
prevents a proper comparison
with the export price.
(C) Third country sales.--This subparagraph
applies when--
(i) a foreign like vessel is not sold
in the exporting country as described
in subparagraph (B)(i), or
(ii) the particular market situation
in the exporting country does not
permit a proper comparison with the
export price.
(D) Contemporaneous sale.--For purposes of
subparagraph (A), ``a time reasonably
corresponding to the time of the sale'' means
within 3 months before or after the sale of the
subject vessel or, in the absence of such
sales, such longer period as the administering
authority determines would be appropriate.
(2) Fictitious markets.--No pretended sale, and no
sale intended to establish a fictitious market, shall
be taken into account in determining normal value.
(3) Use of constructed value.--If the administering
authority determines that the normal value of the
subject vessel cannot be determined under paragraph
(1)(B) or (1)(C), then the normal value of the subject
vessel shall be the constructed value of that vessel,
as determined under subsection (e).
(4) Indirect sales.--If a foreign like vessel is sold
through an affiliated party, the price at which the
foreign like vessel is sold by such affiliated party
may be used in determining normal value.
(5) Adjustments.--The price described in paragraph
(1)(B) shall be--
(A) reduced by--
(i) the amount, if any, included in
the price described in paragraph
(1)(B), attributable to any costs,
charges, and expenses incident to
bringing the foreign like vessel from
the shipyard to the place of delivery
to the purchaser,
(ii) the amount of any taxes imposed
directly upon the foreign like vessel
or components thereof which have been
rebated, or which have not been
collected, on the subject vessel, but
only to the extent that such taxes are
added to or included in the price of
the foreign like vessel, and
(iii) the amount of all other
expenses incidental to placing the
foreign like vessel in condition for
delivery to the buyer, and
(B) increased or decreased by the amount of
any difference (or lack thereof) between the
export price and the price described in
paragraph (1)(B) (other than a difference for
which allowance is otherwise provided under
this section) that is established to the
satisfaction of the administering authority to
be wholly or partly due to--
(i) physical differences between the
subject vessel and the vessel used in
determining normal value, or
(ii) other differences in the
circumstances of sale.
(6) Adjustments for level of trade.--The price
described in paragraph (1)(B) shall also be increased
or decreased to make due allowance for any difference
(or lack thereof) between the export price and the
price described in paragraph (1)(B) (other than a
difference for which allowance is otherwise made under
this section) that is shown to be wholly or partly due
to a difference in level of trade between the export
price and normal value, if the difference in level of
trade--
(A) involves the performance of different
selling activities, and
(B) is demonstrated to affect price
comparability, based on a pattern of consistent
price differences between sales at different
levels of trade in the country in which normal
value is determined.
In a case described in the preceding sentence, the
amount of the adjustment shall be based on the price
differences between the two levels of trade in the
country in which normal value is determined.
(7) Adjustments to constructed value.--Constructed
value as determined under subsection (d) may be
adjusted, as appropriate, pursuant to this subsection.
(b) Sales at Less Than Cost of Production.--
(1) Determination; sales disregarded.--Whenever the
administering authority has reasonable grounds to
believe or suspect that the sale of the foreign like
vessel under consideration for the determination of
normal value has been made at a price which represents
less than the cost of production of the foreign like
vessel, the administering authority shall determine
whether, in fact, such sale was made at less than the
cost of production. If the administering authority
determines that the sale was made at less than the cost
of production and was not at a price which permits
recovery of all costs within 5 years, such sale may be
disregarded in the determination of normal value.
Whenever such a sale is disregarded, normal value shall
be based on another sale of a foreign like vessel in
the ordinary course of trade. If no sales made in the
ordinary course of trade remain, the normal value shall
be based on the constructed value of the subject
vessel.
(2) Definitions and special rules.--For purposes of
this subsection:
(A) Reasonable grounds to believe or
suspect.--There are reasonable grounds to
believe or suspect that the sale of a foreign
like vessel was made at a price that is less
than the cost of production of the vessel, if
an interested party described in subparagraph
(C), (D), (E), or (F) of section 861(17)
provides information, based upon observed
prices or constructed prices or costs, that the
sale of the foreign like vessel under
consideration for the determination of normal
value has been made at a price which represents
less than the cost of production of the vessel.
(B) Recovery of costs.--If the price is below
the cost of production at the time of sale but
is above the weighted average cost of
production for the period of investigation,
such price shall be considered to provide for
recovery of costs within 5 years.
(3) Calculation of cost of production.--For purposes
of this section, the cost of production shall be an
amount equal to the sum of--
(A) the cost of materials and of fabrication
or other processing of any kind employed in
producing the foreign like vessel, during a
period which would ordinarily permit the
production of that vessel in the ordinary
course of business, and
(B) an amount for selling, general, and
administrative expenses based on actual data
pertaining to the production and sale of the
foreign like vessel by the producer in
question.
For purposes of subparagraph (A), if the normal value
is based on the price of the foreign like vessel sold
in a country other than the exporting country, the cost
of materials shall be determined without regard to any
internal tax in the exporting country imposed on such
materials or on their disposition which are remitted or
refunded upon exportation.
(c) Nonmarket Economy Countries.--
(1) In general.--If--
(A) the subject vessel is produced in a
nonmarket economy country, and
(B) the administering authority finds that
available information does not permit the
normal value of the subject vessel to be
determined under subsection (a),
the administering authority shall determine the normal
value of the subject vessel on the basis of the value
of the factors of production utilized in producing the
vessel and to which shall be added an amount for
general expenses and profit plus the cost of expenses
incidental to placing the vessel in a condition for
delivery to the buyer. Except as provided in paragraph
(2), the valuation of the factors of production shall
be based on the best available information regarding
the values of such factors in a market economy country
or countries considered to be appropriate by the
administering authority.
(2) Exception.--If the administering authority finds
that the available information is inadequate for
purposes of determining the normal value of the subject
vessel under paragraph (1), the administering authority
shall determine the normal value on the basis of the
price at which a vessel that is--
(A) comparable to the subject vessel, and
(B) produced in one or more market economy
countries that are at a level of economic
development comparable to that of the nonmarket
economy country,
is sold in other countries, including the United
States.
(3) Factors of production.--For purposes of paragraph
(1), the factors of production utilized in producing
the vessel include, but are not limited to--
(A) hours of labor required,
(B) quantities of raw materials employed,
(C) amounts of energy and other utilities
consumed, and
(D) representative capital cost, including
depreciation.
(4) Valuation of factors of production.--The
administering authority, in valuing factors of
production under paragraph (1), shall utilize, to the
extent possible, the prices or costs of factors of
production in one or more market economy countries that
are--
(A) at a level of economic development
comparable to that of the nonmarket economy
country, and
(B) significant producers of comparable
vessels.
(d) Special Rule for Certain Multinational Corporations.--
Whenever, in the course of an investigation under this title,
the administering authority determines that--
(1) the subject vessel was produced in facilities
which are owned or controlled, directly or indirectly,
by a person, firm, or corporation which also owns or
controls, directly or indirectly, other facilities for
the production of a foreign like vessel which are
located in another country or countries,
(2) subsection (a)(1)(C) applies, and
(3) the normal value of a foreign like vessel
produced in one or more of the facilities outside the
exporting country is higher than the normal value of
the foreign like vessel produced in the facilities
located in the exporting country,
the administering authority shall determine the normal value of
the subject vessel by reference to the normal value at which a
foreign like vessel is sold from one or more facilities outside
the exporting country. The administering authority, in making
any determination under this subsection, shall make adjustments
for the difference between the costs of production (including
taxes, labor, materials, and overhead) of the foreign like
vessel produced in facilities outside the exporting country and
costs of production of the foreign like vessel produced in
facilities in the exporting country, if such differences are
demonstrated to its satisfaction.
(e) Constructed Value.--
(1) In general.--For purposes of this title, the
constructed value of a subject vessel shall be an
amount equal to the sum of--
(A) the cost of materials and fabrication or
other processing of any kind employed in
producing the subject vessel, during a period
which would ordinarily permit the production of
the vessel in the ordinary course of business,
and
(B)(i) the actual amounts incurred and
realized by the foreign producer of the subject
vessel for selling, general, and administrative
expenses, and for profits, in connection with
the production and sale of a foreign like
vessel, in the ordinary course of trade, in the
domestic market of the country of origin of the
subject vessel, or
(ii) if actual data are not available with
respect to the amounts described in clause (i),
then--
(I) the actual amounts incurred and
realized by the foreign producer of the
subject vessel for selling, general,
and administrative expenses, and for
profits, in connection with the
production and sale of the same general
category of vessel in the domestic
market of the country of origin of the
subject vessel,
(II) the weighted average of the
actual amounts incurred and realized by
producers in the country of origin of
the subject vessel (other than the
producer of the subject vessel) for
selling, general, and administrative
expenses, and for profits, in
connection with the production and sale
of a foreign like vessel, in the
ordinary course of trade, in the
domestic market, or
(III) if data is not available under
subclause (I) or (II), the amounts
incurred and realized for selling,
general, and administrative expenses,
and for profits, based on any other
reasonable method, except that the
amount allowed for profit may not
exceed the amount normally realized by
foreign producers (other than the
producer of the subject vessel) in
connection with the sale of vessels in
the same general category of vessel as
the subject vessel in the domestic
market of the country of origin of the
subject vessel.
The profit shall, for purposes of this paragraph, be
based on the average profit realized over a reasonable
period of time before and after the sale of the subject
vessel and shall reflect a reasonable profit at the
time of such sale. For purposes of the preceding
sentence, a ``reasonable period of time'' shall not,
except where otherwise appropriate, exceed 6 months
before, or 6 months after, the sale of the subject
vessel. In calculating profit under this paragraph, any
distortion which would result in other than a profit
which is reasonable at the time of the sale shall be
eliminated.
(2) Costs and profits based on other reasonable
methods.--When costs and profits are determined under
paragraph (1)(B)(ii)(III), such determination shall,
except where otherwise appropriate, be based on
appropriate export sales by the producer of the subject
vessel or, absent such sales, to export sales by other
producers of a foreign like vessel or the same general
category of vessel as the subject vessel in the country
of origin of the subject vessel.
(3) Costs of materials.--For purposes of paragraph
(1)(A), the cost of materials shall be determined
without regard to any internal tax in the exporting
country imposed on such materials or their disposition
which are remitted or refunded upon exportation of the
subject vessel produced from such materials.
(f) Special Rules for Calculation of Cost of Production and
for Calculation of Constructed Value.--For purposes of
subsections (b) and (e)--
(1) Costs.--
(A) In general.--Costs shall normally be
calculated based on the records of the foreign
producer of the subject vessel, if such records
are kept in accordance with the generally
accepted accounting principles of the exporting
country and reasonably reflect the costs
associated with the production and sale of the
vessel. The administering authority shall
consider all available evidence on proper
allocation of costs, including that which is
made available by the foreign producer on a
timely basis, if such allocations have been
historically used by the foreign producer, in
particular for establishing appropriate
amortization and depreciation periods, and
allowances for capital expenditures and other
development costs.
(B) Nonrecurring costs.--Costs shall be
adjusted appropriately for those nonrecurring
costs that benefit current or future
production, or both.
(C) Startup costs.--
(i) In general.--Costs shall be
adjusted appropriately for
circumstances in which costs incurred
during the time period covered by the
investigation are affected by startup
operations.
(ii) Startup operations.--Adjustments
shall be made for startup operations
only where--
(I) a producer is using new
production facilities or
producing a new type of vessel
that requires substantial
additional investment, and
(II) production levels are
limited by technical factors
associated with the initial
phase of commercial production.
For purposes of subclause (II), the
initial phase of commercial production
ends at the end of the startup period.
In determining whether commercial
production levels have been achieved,
the administering authority shall
consider factors unrelated to startup
operations that might affect the volume
of production processed, such as
demand, seasonality, or business
cycles.
(iii) Adjustment for startup
operations.--The adjustment for startup
operations shall be made by
substituting the unit production costs
incurred with respect to the vessel at
the end of the startup period for the
unit production costs incurred during
the startup period. If the startup
period extends beyond the period of the
investigation under this title, the
administering authority shall use the
most recent cost of production data
that it reasonably can obtain, analyze,
and verify without delaying the timely
completion of the investigation. For
purposes of this subparagraph, the
startup period ends at the point at
which the level of commercial
production that is characteristic of
the vessel, the producer, or the
industry is achieved.
(D) Costs due to extraordinary circumstances
not included.--Costs shall not include actual
costs which are due to extraordinary
circumstances (including, but not limited to,
labor disputes, fire, and natural disasters)
and which are significantly over the cost
increase which the shipbuilder could have
reasonably anticipated and taken into account
at the time of sale.
(2) Transactions disregarded.--A transaction directly
or indirectly between affiliated persons may be
disregarded if, in the case of any element of value
required to be considered, the amount representing that
element does not fairly reflect the amount usually
reflected in sales of a like vessel in the market under
consideration. If a transaction is disregarded under
the preceding sentence and no other transactions are
available for consideration, the determination of the
amount shall be based on the information available as
to what the amount would have been if the transaction
had occurred between persons who are not affiliated.
(3) Major input rule.--If, in the case of a
transaction between affiliated persons involving the
production by one of such persons of a major input to
the subject vessel, the administering authority has
reasonable grounds to believe or suspect that an amount
represented as the value of such input is less than the
cost of production of such input, then the
administering authority may determine the value of the
major input on the basis of the information available
regarding such cost of production, if such cost is
greater than the amount that would be determined for
such input under paragraph (2).
SEC. 823. CURRENCY CONVERSION.
(a) In General.--In an injurious pricing proceeding under
this title, the administering authority shall convert foreign
currencies into United States dollars using the exchange rate
in effect on the date of sale of the subject vessel, except
that if it is established that a currency transaction on
forward markets is directly linked to a sale under
consideration, the exchange rate specified with respect to such
foreign currency in the forward sale agreement shall be used to
convert the foreign currency.
(b) Date of Sale.--For purposes of this section, ``date of
sale'' means the date of the contract of sale or, where
appropriate, the date on which the material terms of sale are
otherwise established. If the material terms of sale are
significantly changed after such date, the date of sale is the
date of such change. In the case of such a change in the date
of sale, the administering authority shall make appropriate
adjustments to take into account any unreasonable effect on the
injurious pricing margin due only to fluctuations in the
exchange rate between the original date of sale and the new
date of sale.
Subtitle C--Procedures
SEC. 841. HEARINGS.
(a) Upon Request.--The administering authority and the
Commission shall each hold a hearing in the course of an
investigation under this title, upon the request of any party
to the investigation, before making a final determination under
section 805.
(b) Procedures.--Any hearing required or permitted under this
title shall be conducted after notice published in the Federal
Register, and a transcript of the hearing shall be prepared and
made available to the public. The hearing shall not be subject
to the provisions of subchapter II of chapter 5 of title 5,
United States Code, or to section 702 of such title.
SEC. 842. DETERMINATIONS ON THE BASIS OF THE FACTS AVAILABLE.
(a) In General.--If--
(1) necessary information is not available on the
record, or
(2) an interested party or any other person--
(A) withholds information that has been
requested by the administering authority or the
Commission under this title,
(B) fails to provide such information by the
deadlines for the submission of the information
or in the form and manner requested, subject to
subsections (b)(1) and (d) of section 844,
(C) significantly impedes a proceeding under
this title, or
(D) provides such information but the
information cannot be verified as provided in
section 844(g),
the administering authority and the Commission shall,
subject to section 844(c), use the facts otherwise
available in reaching the applicable determination
under this title.
(b) Adverse Inferences.--If the administering authority or
the Commission (as the case may be) finds that an interested
party has failed to cooperate by not acting to the best of its
ability to comply with a request for information from the
administering authority or the Commission, the administering
authority or the Commission (as the case may be), in reaching
the applicable determination under this title, may use an
inference that is adverse to the interests of that party in
selecting from among the facts otherwise available. Such
adverse inference may include reliance on information derived
from--
(1) the petition, or
(2) any other information placed on the record.
(c) Corroboration of Secondary Information.--When the
administering authority or the Commission relies on secondary
information rather than on information obtained in the course
of an investigation under this title, the administering
authority and the Commission, as the case may be, shall, to the
extent practicable, corroborate that information from
independent sources that are reasonably at their disposal.
SEC. 843. ACCESS TO INFORMATION.
(a) Information Generally Made Available.--
(1) Progress of investigation reports.--The
administering authority and the Commission shall, from
time to time upon request, inform the parties to an
investigation under this title of the progress of that
investigation.
(2) Ex parte meetings.--The administering authority
and the Commission shall maintain a record of any ex
parte meeting between--
(A) interested parties or other persons
providing factual information in connection
with a proceeding under this title, and
(B) the person charged with making the
determination, or any person charged with
making a final recommendation to that person,
in connection with that proceeding,
if information relating to that proceeding was
presented or discussed at such meeting. The record of
such an ex parte meeting shall include the identity of
the persons present at the meeting, the date, time, and
place of the meeting, and a summary of the matters
discussed or submitted. The record of the ex parte
meeting shall be included in the record of the
proceeding.
(3) Summaries; non-proprietary submissions.--The
administering authority and the Commission shall
disclose--
(A) any proprietary information received in
the course of a proceeding under this title if
it is disclosed in a form which cannot be
associated with, or otherwise be used to
identify, operations of a particular person,
and
(B) any information submitted in connection
with a proceeding which is not designated as
proprietary by the person submitting it.
(4) Maintenance of public record.--The administering
authority and the Commission shall maintain and make
available for public inspection and copying a record of
all information which is obtained by the administering
authority or the Commission, as the case may be, in a
proceeding under this title to the extent that public
disclosure of the information is not prohibited under
this chapter or exempt from disclosure under section
552 of title 5, United States Code.
(b) Proprietary Information.--
(1) Proprietary status maintained.--
(A) In general.--Except as provided in
subsection (a)(4) and subsection (c),
information submitted to the administering
authority or the Commission which is designated
as proprietary by the person submitting the
information shall not be disclosed to any
person without the consent of the person
submitting the information, other than--
(i) to an officer or employee of the
administering authority or the
Commission who is directly concerned
with carrying out the investigation in
connection with which the information
is submitted or any other proceeding
under this title covering the same
subject vessel, or
(ii) to an officer or employee of the
United States Customs Service who is
directly involved in conducting an
investigation regarding fraud under
this title.
(B) Additional requirements.--The
administering authority and the Commission
shall require that information for which
proprietary treatment is requested be
accompanied by--
(i) either--
(I) a nonproprietary summary
in sufficient detail to permit
a reasonable understanding of
the substance of the
information submitted in
confidence, or
(II) a statement that the
information is not susceptible
to summary, accompanied by a
statement of the reasons in
support of the contention, and
(ii) either--
(I) a statement which permits
the administering authority or
the Commission to release under
administrative protective
order, in accordance with
subsection (c), the information
submitted in confidence, or
(II) a statement to the
administering authority or the
Commission that the business
proprietary information is of a
type that should not be
released under administrative
protective order.
(2) Unwarranted designation.--If the administering
authority or the Commission determines, on the basis of
the nature and extent of the information or its
availability from public sources, that designation of
any information as proprietary is unwarranted, then it
shall notify the person who submitted it and ask for an
explanation of the reasons for the designation. Unless
that person persuades the administering authority or
the Commission that the designation is warranted, or
withdraws the designation, the administering authority
or the Commission, as the case may be, shall return it
to the party submitting it. In a case in which the
administering authority or the Commission returns the
information to the person submitting it, the person may
thereafter submit other material concerning the subject
matter of the returned information if the submission is
made within the time otherwise provided for submitting
such material.
(c) Limited Disclosure of Certain Proprietary Information
Under Protective Order.--
(1) Disclosure by administering authority or
commission.--
(A) In general.--Upon receipt of an
application (before or after receipt of the
information requested) which describes in
general terms the information requested and
sets forth the reasons for the request, the
administering authority or the Commission shall
make all business proprietary information
presented to, or obtained by it, during a
proceeding under this title (except privileged
information, classified information, and
specific information of a type for which there
is a clear and compelling need to withhold from
disclosure) available to all interested parties
who are parties to the proceeding under a
protective order described in subparagraph (B),
regardless of when the information is submitted
during the proceeding. Customer names (other
than the name of the United States buyer of the
subject vessel) obtained during any
investigation which requires a determination
under section 805(b) may not be disclosed by
the administering authority under protective
order until either an order is published under
section 806(a) as a result of the investigation
or the investigation is suspended or
terminated. The Commission may delay disclosure
of customer names (other than the name of the
United States buyer of the subject vessel)
under protective order during any such
investigation until a reasonable time before
any hearing provided under section 841 is held.
(B) Protective order.--The protective order
under which information is made available shall
contain such requirements as the administering
authority or the Commission may determine by
regulation to be appropriate. The administering
authority and the Commission shall provide by
regulation for such sanctions as the
administering authority and the Commission
determine to be appropriate, including
disbarment from practice before the agency.
(C) Time limitations on determinations.--The
administering authority or the Commission, as
the case may be, shall determine whether to
make information available under this
paragraph--
(i) not later than 14 days (7 days if
the submission pertains to a proceeding
under section 803(a)) after the date on
which the information is submitted, or
(ii) if--
(I) the person submitting the
information raises objection to
its release, or
(II) the information is
unusually voluminous or
complex,
not later than 30 days (10 days if the
submission pertains to a proceeding
under section 803(a)) after the date on
which the information is submitted.
(D) Availability after determination.--If the
determination under subparagraph (C) is
affirmative, then--
(i) the business proprietary
information submitted to the
administering authority or the
Commission on or before the date of the
determination shall be made available,
subject to the terms and conditions of
the protective order, on such date, and
(ii) the business proprietary
information submitted to the
administering authority or the
Commission after the date of the
determination shall be served as
required by subsection (d).
(E) Failure to disclose.--If a person
submitting information to the administering
authority refuses to disclose business
proprietary information which the administering
authority determines should be released under a
protective order described in subparagraph (B),
the administering authority shall return the
information, and any nonconfidential summary
thereof, to the person submitting the
information and summary and shall not consider
either.
(2) Disclosure under court order.--If the
administering authority or the Commission denies a
request for information under paragraph (1), then
application may be made to the United States Court of
International Trade for an order directing the
administering authority or the Commission, as the case
may be, to make the information available. After
notification of all parties to the investigation and
after an opportunity for a hearing on the record, the
court may issue an order, under such conditions as the
court deems appropriate, which shall not have the
effect of stopping or suspending the investigation,
directing the administering authority or the Commission
to make all or a portion of the requested information
described in the preceding sentence available under a
protective order and setting forth sanctions for
violation of such order if the court finds that, under
the standards applicable in proceedings of the court,
such an order is warranted, and that--
(A) the administering authority or the
Commission has denied access to the information
under subsection (b)(1),
(B) the person on whose behalf the
information is requested is an interested party
who is a party to the investigation in
connection with which the information was
obtained or developed, and
(C) the party which submitted the information
to which the request relates has been notified,
in advance of the hearing, of the request made
under this section and of its right to appear
and be heard.
(d) Service.--Any party submitting written information,
including business proprietary information, to the
administering authority or the Commission during a proceeding
shall, at the same time, serve the information upon all
interested parties who are parties to the proceeding, if the
information is covered by a protective order. The administering
authority or the Commission shall not accept any such
information that is not accompanied by a certificate of service
and a copy of the protective order version of the document
containing the information. Business proprietary information
shall only be served upon interested parties who are parties to
the proceeding that are subject to protective order, except
that a nonconfidential summary thereof shall be served upon all
other interested parties who are parties to the proceeding.
(e) Information Relating to Violations of Protective Orders
and Sanctions.--The administering authority and the Commission
may withhold from disclosure any correspondence, private
letters of reprimand, settlement agreements, and documents and
files compiled in relation to investigations and actions
involving a violation or possible violation of a protective
order issued under subsection (c), and such information shall
be treated as information described in section 552(b)(3) of
title 5, United States Code.
(f) Opportunity for Comment by Vessel Buyers.--The
administering authority and the Commission shall provide an
opportunity for buyers of subject vessels to submit relevant
information to the administering authority concerning a sale at
less than fair value or countermeasures, and to the Commission
concerning material injury by reason of the sale of a vessel at
less than fair value.
(g) Publication of Determinations; Requirements for Final
Determinations.--
(1) In general.--Whenever the administering authority
makes a determination under section 802 whether to
initiate an investigation, or the administering
authority or the Commission makes a preliminary
determination under section 803, a final determination
under section 805, a determination under subsection
(b), (c), (d), (e)(3)(B)(ii), (g), or (i) of section
807, or a determination to suspend an investigation
under this title, the administering authority or the
Commission, as the case may be, shall publish the facts
and conclusions supporting that determination, and
shall publish notice of that determination in the
Federal Register.
(2) Contents of notice or determination.--The notice
or determination published under paragraph (1) shall
include, to the extent applicable--
(A) in the case of a determination of the
administering authority--
(i) the names of the foreign producer
and the country of origin of the
subject vessel,
(ii) a description sufficient to
identify the subject vessel,
(iii) with respect to an injurious
pricing charge, the injurious pricing
margin established and a full
explanation of the methodology used in
establishing such margin,
(iv) with respect to countermeasures,
the scope and duration of
countermeasures and, if applicable, any
changes thereto, and
(v) the primary reasons for the
determination, and
(B) in the case of a determination of the
Commission--
(i) considerations relevant to the
determination of injury, and
(ii) the primary reasons for the
determination.
(3) Additional requirements for final
determinations.--In addition to the requirements set
forth in paragraph (2)--
(A) the administering authority shall include
in a final determination under section 805 or
807(c) an explanation of the basis for its
determination that addresses relevant
arguments, made by interested parties who are
parties to the investigation, concerning the
establishment of the injurious pricing charge
with respect to which the determination is
made, and
(B) the Commission shall include in a final
determination of injury an explanation of the
basis for its determination that addresses
relevant arguments that are made by interested
parties who are parties to the investigation
concerning the effects and impact on the
industry of the sale of the subject vessel.
SEC. 844. CONDUCT OF INVESTIGATIONS.
(a) Certification of Submissions.--Any person providing
factual information to the administering authority or the
Commission in connection with a proceeding under this title on
behalf of the petitioner or any other interested party shall
certify that such information is accurate and complete to the
best of that person's knowledge.
(b) Difficulties in Meeting Requirements.--
(1) Notification by interested party.--If an
interested party, promptly after receiving a request
from the administering authority or the Commission for
information, notifies the administering authority or
the Commission (as the case may be) that such party is
unable to submit the information requested in the
requested form and manner, together with a full
explanation and suggested alternative forms in which
such party is able to submit the information, the
administering authority or the Commission (as the case
may be) shall consider the ability of the interested
party to submit the information in the requested form
and manner and may modify such requirements to the
extent necessary to avoid imposing an unreasonable
burden on that party.
(2) Assistance to interested parties.--The
administering authority and the Commission shall take
into account any difficulties experienced by interested
parties, particularly small companies, in supplying
information requested by the administering authority or
the Commission in connection with investigations under
this title, and shall provide to such interested
parties any assistance that is practicable in supplying
such information.
(c) Deficient Submissions.--If the administering authority or
the Commission determines that a response to a request for
information under this title does not comply with the request,
the administering authority or the Commission (as the case may
be) shall promptly inform the person submitting the response of
the nature of the deficiency and shall, to the extent
practicable, provide that person with an opportunity to remedy
or explain the deficiency in light of the time limits
established for the completion of investigations or reviews
under this title. If that person submits further information in
response to such deficiency and either--
(1) the administering authority or the Commission (as
the case may be) finds that such response is not
satisfactory, or
(2) such response is not submitted within the
applicable time limits,
then the administering authority or the Commission (as the case
may be) may, subject to subsection (d), disregard all or part
of the original and subsequent responses.
(d) Use of Certain Information.--In reaching a determination
under section 803, 805, or 807, the administering authority and
the Commission shall not decline to consider information that
is submitted by an interested party and is necessary to the
determination but does not meet all the applicable requirements
established by the administering authority or the Commission
if--
(1) the information is submitted by the deadline
established for its submission,
(2) the information can be verified,
(3) the information is not so incomplete that it
cannot serve as a reliable basis for reaching the
applicable determination,
(4) the interested party has demonstrated that it
acted to the best of its ability in providing the
information and meeting the requirements established by
the administering authority or the Commission with
respect to the information, and
(5) the information can be used without undue
difficulties.
(e) Nonacceptance of Submissions.--If the administering
authority or the Commission declines to accept into the record
any information submitted in an investigation under this title,
it shall, to the extent practicable, provide to the person
submitting the information a written explanation of the reasons
for not accepting the information.
(f) Public Comment on Information.--Information that is
submitted on a timely basis to the administering authority or
the Commission during the course of a proceeding under this
title shall be subject to comment by other parties within such
reasonable time as the administering authority or the
Commission shall provide. The administering authority and the
Commission, before making a final determination under section
805 or 807, shall cease collecting information and shall
provide the parties with a final opportunity to comment on the
information obtained by the administering authority or the
Commission (as the case may be) upon which the parties have not
previously had an opportunity to comment. Comments containing
new factual information shall be disregarded.
(g) Verification.--The administering authority shall verify
all information relied upon in making a final determination
under section 805.
SEC. 845. ADMINISTRATIVE ACTION FOLLOWING SHIPBUILDING AGREEMENT PANEL
REPORTS.
(a) Action by United States International Trade Commission.--
(1) Advisory report.--If a dispute settlement panel
under the Shipbuilding Agreement finds in a report that
an action by the Commission in connection with a
particular proceeding under this title is not in
conformity with the obligations of the United States
under the Shipbuilding Agreement, the Trade
Representative may request the Commission to issue an
advisory report on whether this title permits the
Commission to take steps in connection with the
particular proceeding that would render its action not
inconsistent with the findings of the panel concerning
those obligations. The Trade Representative shall
notify the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the
Senate of such request.
(2) Time limits for report.--The Commission shall
transmit its report under paragraph (1) to the Trade
Representative within 30 calendar days after the Trade
Representative requests the report.
(3) Consultations on request for commission
determination.--If a majority of the Commissioners
issues an affirmative report under paragraph (1), the
Trade Representatives shall consult with the
congressional committees listed in paragraph (1)
concerning the matter.
(4) Commission determination.--Notwithstanding any
other provision of this title, if a majority of the
Commissioners issues an affirmative report under
paragraph (1), the Commission, upon the written request
of the Trade Representative, shall issue a
determination in connection with the particular
proceeding that would render the Commission's action
described in paragraph (1) not inconsistent with the
findings of the panel. The Commission shall issue its
determination not later than 120 calendar days after
the request from the Trade Representative is made.
(5) Consultations on implementation of commission
determination.--The Trade Representative shall consult
with the congressional committees listed in paragraph
(1) before the Commission's determination under
paragraph (4) is implemented.
(6) Revocation of order.--If, by virtue of the
Commission's determination under paragraph (4), an
injurious pricing order is no longer supported by an
affirmative Commission determination under this title,
the Trade Representative may, after consulting with the
congressional committees under paragraph (5), direct
the administering authority to revoke the injurious
pricing order.
(b) Action by Administering Authority.--
(1) Consultations with administering authority and
congressional committees.--Promptly after a report or
other determination by a dispute settlement panel under
the Shipbuilding Agreement is issued that contains
findings that--
(A) an action by the administering authority
in a proceeding under this title is not in
conformity with the obligations of the United
States under the Shipbuilding Agreement,
(B) the due date for payment of an injurious
pricing charge contained in an order issued
under section 806 should be amended,
(C) countermeasures provided for in an order
issued under section 807 should be
provisionally suspended or reduced pending the
final decision of the panel, or
(D) the scope or duration of countermeasures
imposed under section 807 should be narrowed or
shortened,
the Trade Representative shall consult with the
administering authority and the congressional
committees listed in subsection (a)(1) on the matter.
(2) Determination by administering authority.--
Notwithstanding any other provision of this title, the
administering authority shall, in response to a written
request from the Trade Representative, issue a
determination, or an amendment to or suspension of an
injurious pricing or countermeasure order, as the case
may be, in connection with the particular proceeding
that would render the administering authority's action
described in paragraph (1) not inconsistent with the
findings of the panel.
(3) Time limits for determinations.--The
administering authority shall issue its determination,
amendment, or suspension under paragraph (2)--
(A) with respect to a matter described in
subparagraph (A) of paragraph (1), within 180
calendar days after the request from the Trade
Representative is made, and
(B) with respect to a matter described in
subparagraph (B), (C), or (D) of paragraph (1),
within 15 calendar days after the request from
the Trade Representative is made.
(4) Consultations before implementation.--Before the
administering authority implements any determination,
amendment, or suspension under paragraph (2), the Trade
Representative shall consult with the administering
authority and the congressional committees listed in
subsection (a)(1) with respect to such determination,
amendment, or suspension.
(5) Implementation of determination.--The Trade
Representative may, after consulting with the
administering authority and the congressional
committees under paragraph (4), direct the
administering authority to implement, in whole or in
part, the determination, amendment, or suspension made
under paragraph (2).
(6) Implementation of determination; notice of
implementation.--The administering authority shall
implement the determination, amendment, or suspension
under paragraph (2)--
(A) with respect to a matter described in
subparagraph (A) of paragraph (1), only if the
injurious pricing margin determined under
paragraph (2) differs from the injurious
pricing margin in the determination reviewed by
the panel, and
(B) with respect to a matter described in
subparagraph (B), (C), or (D) of paragraph (1),
upon issuance of the determination, amendment,
or suspension under paragraph (2).
The administering authority shall publish notice of
such implementation in the Federal Register.
(c) Opportunity for Comment by Interested Parties.--Before
issuing a determination, amendment, or suspension, the
administering authority, in a matter described in subsection
(b)(1)(A), or the Commission, in a matter described in
subsection (a)(1), as the case may be, shall provide interested
parties with an opportunity to submit written comments and, in
appropriate cases, may hold a hearing, with respect to the
determination.
Subtitle D--Definitions
SEC. 861. DEFINITIONS.
For purposes of this title:
(1) Administering authority.--The term
``administering authority'' means the Secretary of
Commerce, or any other officer of the United States to
whom the responsibility for carrying out the duties of
the administering authority under this title are
transferred by law.
(2) Commission.--The term ``Commission'' means the
United States International Trade Commission.
(3) Country.--The term ``country'' means a foreign
country, a political subdivision, dependent territory,
or possession of a foreign country and, except as
provided in paragraph (16)(E)(iii), may not include an
association of 2 or more foreign countries, political
subdivisions, dependent territories, or possessions of
countries into a customs union outside the United
States.
(4) Industry.--
(A) In general.--Except as used in section
808, the term ``industry'' means the producers
as a whole of a domestic like vessel, or those
producers whose collective capability to
produce a domestic like vessel constitutes a
major proportion of the total domestic
capability to produce a domestic like vessel.
(B) Producer.--A ``producer'' of a domestic
like vessel includes an entity that is
producing the domestic like vessel and an
entity with the capability to produce the
domestic like vessel.
(C) Capability to produce a domestic like
vessel.--A producer has the ``capability to
produce a domestic like vessel'' if it is
capable of producing a domestic like vessel
with its present facilities or could adapt its
facilities in a timely manner to produce a
domestic like vessel.
(D) Related parties.--(i) In an investigation
under this title, if a producer of a domestic
like vessel and the foreign producer, seller
(other than the foreign producer), or United
States buyer of the subject vessel are related
parties, or if a producer of a domestic like
vessel is also a United States buyer of the
subject vessel, the domestic producer may, in
appropriate circumstances, be excluded from the
industry.
(ii) For purposes of clause (i), a domestic
producer and the foreign producer, seller, or
United States buyer shall be considered to be
related parties, if--
(I) the domestic producer directly or
indirectly controls the foreign
producer, seller or United States
buyer,
(II) the foreign producer, seller, or
United States buyer directly or
indirectly controls the domestic
producer,
(III) a third party directly or
indirectly controls the domestic
producer and the foreign producer,
seller, or United States buyer, or
(IV) the domestic producer and the
foreign producer, seller, or United
States buyer directly or indirectly
control a third party and there is
reason to believe that the relationship
causes the producer to act differently
than a nonrelated producer.
For purposes of this subparagraph, a party
shall be considered to directly or indirectly
control another party if the party is legally
or operationally in a position to exercise
restraint or direction over the other party.
(E) Product lines.--In an investigation under
this title, the effect of the sale of the
subject vessel shall be assessed in relation to
the United States production (or production
capability) of a domestic like vessel if
available data permit the separate
identification of production (or production
capability) in terms of such criteria as the
production process or the producer's profits.
If the domestic production (or production
capability) of a domestic like vessel has no
separate identity in terms of such criteria,
then the effect of the sale shall be assessed
by the examination of the production (or
production capability) of the narrowest group
or range of vessels, which includes a domestic
like vessel, for which the necessary
information can be provided.
(5) Buyer.--The term ``buyer'' means any person who
acquires an ownership interest in a vessel, including
by way of lease or long-term bareboat charter, in
conjunction with the original transfer from the
producer, either directly or indirectly, including an
individual or company which owns or controls a buyer.
There may be more than one buyer of any one vessel.
(6) United states buyer.--The term ``United States
buyer'' means a buyer that is any of the following:
(A) A United States citizen.
(B) A juridical entity, including any
corporation, company, association, or other
organization, that is legally constituted under
the laws and regulations of the United States
or a political subdivision thereof, regardless
of whether the entity is organized for
pecuniary gain, privately or government owned,
or organized with limited or unlimited
liability.
(C) A juridical entity that is owned or
controlled by nationals or entities described
in subparagraphs (A) and (B). For the purposes
of this subparagraph--
(i) the term ``own'' means having
more than a 50 percent interest, and
(ii) the term ``control'' means the
actual ability to have substantial
influence on corporate behavior, and
control is presumed to exist where
there is at least a 25 percent
interest.
If ownership of a company is established under
clause (i), other control is presumed not to
exist unless it is otherwise established.
(7) Ownership interest.--An ``ownership interest'' in
a vessel includes any contractual or proprietary
interest which allows the beneficiary or beneficiaries
of such interest to take advantage of the operation of
the vessel in a manner substantially comparable to the
way in which an owner may benefit from the operation of
the vessel. In determining whether such substantial
comparability exists, the administering authority shall
consider--
(A) the terms and circumstances of the
transaction which conveys the interest,
(B) commercial practice,
(C) whether the vessel subject to the
transaction is integrated into the operations
of the beneficiary or beneficiaries, and
(D) whether in practice there is a likelihood
that the beneficiary or beneficiaries of such
interests will take advantage of and the risk
for the operation of the vessel for a
significant part of the life-time of the
vessel.
(8) Vessel.--
(A) In general.--Except as otherwise
specifically provided under international
agreements, the term ``vessel'' means--
(i) a self-propelled seagoing vessel
of 100 gross tons or more used for
transportation of goods or persons or
for performance of a specialized
service (including, but not limited to,
ice breakers and dredgers), and
(ii) a tug of 365 kilowatts or more,
that is produced in a Shipbuilding Agreement
Party or a country that is not a Shipbuilding
Agreement Party and not a WTO member.
(B) Exclusions.--The term ``vessel'' does not
include--
(i) any fishing vessel destined for
the fishing fleet of the country in
which the vessel is built,
(ii) any military vessel, and
(iii) any vessel sold before the date
that the Shipbuilding Agreement enters
into force with respect to the United
States, except that any vessel sold
after December 21, 1994, for delivery
more than 5 years after the date of the
contract of sale shall be a ``vessel''
for purposes of this title unless the
shipbuilder demonstrates to the
administering authority that the
extended delivery date was for normal
commercial reasons and not to avoid
applicability of this title.
(C) Self-propelled seagoing vessel.--A vessel
is ``self-propelled seagoing'' if its permanent
propulsion and steering provide it all the
characteristics of self-navigability in the
high seas.
(D) Military vessel.--A ``military vessel''
is a vessel which, according to its basic
structural characteristics and ability, is
intended to be used exclusively for military
purposes.
(9) Like vessel.--The term ``like vessel'' means a
vessel of the same type, same purpose, and approximate
size as the subject vessel and possessing
characteristics closely resembling those of the subject
vessel.
(10) Domestic like vessel.--The term ``domestic like
vessel'' means a like vessel produced in the United
States.
(11) Foreign like vessel.--Except as used in section
822(e)(1)(B)(ii)(II), the term ``foreign like vessel''
means a like vessel produced by the foreign producer of
the subject vessel for sale in the producer's domestic
market or in a third country.
(12) Same general category of vessel.--The term
``same general category of vessel'' means a vessel of
the same type and purpose as the subject vessel, but of
a significantly different size.
(13) Subject vessel.--The term ``subject vessel''
means a vessel subject to investigation under section
801 or 808.
(14) Foreign producer.--The term ``foreign producer''
means the producer or producers of the subject vessel.
(15) Exporting country.--The term ``exporting
country'' means the country in which the subject vessel
was built.
(16) Material injury.--
(A) In general.--The term ``material injury''
means harm which is not inconsequential,
immaterial, or unimportant.
(B) Sale and consequent impact.--In making
determinations under sections 803(a) and
805(b), the Commission in each case--
(i) shall consider--
(I) the sale of the subject
vessel,
(II) the effect of the sale
of the subject vessel on prices
in the United States for a
domestic like vessel, and
(III) the impact of the sale
of the subject vessel on
domestic producers of the
domestic like vessel, but only
in the context of production
operations within the United
States, and
(ii) may consider such other economic
factors as are relevant to the
determination regarding whether there
is or has been material injury by
reason of the sale of the subject
vessel.
In the notification required under section
805(d), the Commission shall explain its
analysis of each factor considered under clause
(i), and identify each factor considered under
clause (ii) and explain in full its relevance
to the determination.
(C) Evaluation of relevant factors.--For
purposes of subparagraph (B)--
(i) Sale of the subject vessel.--In
evaluating the sale of the subject
vessel, the Commission shall consider
whether the sale, either in absolute
terms or relative to production or
demand in the United States, in terms
of either volume or value, is or has
been significant.
(ii) Price.--In evaluating the effect
of the sale of the subject vessel on
prices, the Commission shall consider
whether--
(I) there has been
significant price underselling
of the subject vessel as
compared with the price of a
domestic like vessel, and
(II) the effect of the sale
of the subject vessel otherwise
depresses or has depressed
prices to a significant degree
or prevents or has prevented
price increases, which
otherwise would have occurred,
to a significant degree.
(iii) Impact on affected domestic
industry.--In examining the impact
required to be considered under
subparagraph (B)(i)(III), the
Commission shall evaluate all relevant
economic factors which have a bearing
on the state of the industry in the
United States, including, but not
limited to--
(I) actual and potential
decline in output, sales,
market share, profits,
productivity, return on
investments, and utilization of
capacity,
(II) factors affecting
domestic prices, including with
regard to sales,
(III) actual and potential
negative effects on cash flow,
employment, wages, growth,
ability to raise capital, and
investment,
(IV) actual and potential
negative effects on the
existing development and
production efforts of the
domestic industry, including
efforts to develop a derivative
or more advanced version of a
domestic like vessel, and
(V) the magnitude of the
injurious pricing margin.
The Commission shall evaluate all
relevant economic factors described in
this clause within the context of the
business cycle and conditions of
competition that are distinctive to the
affected industry.
(D) Standard for determination.--The presence
or absence of any factor which the Commission
is required to evaluate under subparagraph (C)
shall not necessarily give decisive guidance
with respect to the determination by the
Commission of material injury.
(E) Threat of material injury.--
(i) In general.--In determining
whether an industry in the United
States is threatened with material
injury by reason of the sale of the
subject vessel, the Commission shall
consider, among other relevant economic
factors--
(I) any existing unused
production capacity or
imminent, substantial increase
in production capacity in the
exporting country indicating
the likelihood of substantially
increased sales of a foreign
like vessel to United States
buyers, taking into account the
availability of other export
markets to absorb any
additional exports,
(II) whether the sale of a
foreign like vessel or other
factors indicate the likelihood
of significant additional sales
to United States buyers,
(III) whether sale of the
subject vessel or sale of a
foreign like vessel by the
foreign producer are at prices
that are likely to have a
significant depressing or
suppressing effect on domestic
prices, and are likely to
increase demand for further
sales,
(IV) the potential for
product-shifting if production
facilities in the exporting
country, which can presently be
used to produce a foreign like
vessel or could be adapted in a
timely manner to produce a
foreign like vessel, are
currently being used to produce
other types of vessels,
(V) the actual and potential
negative effects on the
existing development and
production efforts of the
domestic industry, including
efforts to develop a derivative
or more advanced version of a
domestic like vessel, and
(VI) any other demonstrable
adverse trends that indicate
the probability that there is
likely to be material injury by
reason of the sale of the
subject vessel.
(ii) Basis for determination.--The
Commission shall consider the factors
set forth in clause (i) as a whole. The
presence or absence of any factor which
the Commission is required to consider
under clause (i) shall not necessarily
give decisive guidance with respect to
the determination. Such a determination
may not be made on the basis of mere
conjecture or supposition.
(iii) Effect of injurious pricing in
third-country markets.--
(I) In general.--The
Commission shall consider
whether injurious pricing in
the markets of foreign
countries (as evidenced by
injurious pricing findings or
injurious pricing remedies of
other Shipbuilding Agreement
Parties, or antidumping
determinations of, or measures
imposed by, other countries,
against a like vessel produced
by the producer under
investigation) suggests a
threat of material injury to
the domestic industry. In the
course of its investigation,
the Commission shall request
information from the foreign
producer or United States buyer
concerning this issue.
(II) European communities.--
For purposes of this clause,
the European Communities as a
whole shall be treated as a
single foreign country.
(F) Cumulation for determining material
injury.--
(i) In general.--For purposes of
clauses (i) and (ii) of subparagraph
(C), and subject to clause (ii) of this
subparagraph, the Commission shall
cumulatively assess the effects of
sales of foreign like vessels from all
foreign producers with respect to
which--
(I) petitions were filed
under section 802(b) on the
same day,
(II) investigations were
initiated under section 802(a)
on the same day, or
(III) petitions were filed
under section 802(b) and
investigations were initiated
under section 802(a) on the
same day,
if, with respect to such vessels, the
foreign producers compete with each
other and with producers of a domestic
like vessel in the United States
market.
(ii) Exceptions.--The Commission
shall not cumulatively assess the
effects of sales under clause (i)--
(I) with respect to which the
administering authority has
made a preliminary negative
determination, unless the
administering authority
subsequently made a final
affirmative determination with
respect to those sales before
the Commission's final
determination is made, or
(II) from any producer with
respect to which the
investigation has been
terminated.
(iii) Records in final
investigations.--In each final
determination in which it cumulatively
assesses the effects of sales under
clause (i), the Commission may make its
determinations based on the record
compiled in the first investigation in
which it makes a final determination,
except that when the administering
authority issues its final
determination in a subsequently
completed investigation, the Commission
shall permit the parties in the
subsequent investigation to submit
comments concerning the significance of
the administering authority's final
determination, and shall include such
comments and the administering
authority's final determination in the
record for the subsequent
investigation.
(G) Cumulation for determining threat of
material injury.--To the extent practicable and
subject to subparagraph (F)(ii), for purposes
of clause (i) (II) and (III) of subparagraph
(E), the Commission may cumulatively assess the
effects of sales of like vessels from all
countries with respect to which--
(i) petitions were filed under
section 802(b) on the same day,
(ii) investigations were initiated
under section 802(a) on the same day,
or
(iii) petitions were filed under
section 802(b) and investigations were
initiated under section 802(a) on the
same day,
if, with respect to such vessels, the foreign
producers compete with each other and with
producers of a domestic like vessel in the
United States market.
(17) Interested party.--The term ``interested party''
means, in a proceeding under this title--
(A)(i) the foreign producer, seller (other
than the foreign producer), and the United
States buyer of the subject vessel, or
(ii) a trade or business association a
majority of the members of which are the
foreign producer, seller, or United States
buyer of the subject vessel,
(B) the government of the country in which
the subject vessel is produced or manufactured,
(C) a producer that is a member of an
industry,
(D) a certified union or recognized union or
group of workers which is representative of an
industry,
(E) a trade or business association a
majority of whose members are producers in an
industry,
(F) an association, a majority of whose
members is composed of interested parties
described in subparagraph (C), (D), or (E), and
(G) for purposes of section 807, a purchaser
who, after the effective date of an order
issued under that section, entered into a
contract of sale with the foreign producer that
is subject to the order.
(18) Affirmative determinations by divided
commission.--If the Commissioners voting on a
determination by the Commission are evenly divided as
to whether the determination should be affirmative or
negative, the Commission shall be deemed to have made
an affirmative determination. For the purpose of
applying this paragraph when the issue before the
Commission is to determine whether there is or has
been--
(A) material injury to an industry in the
United States,
(B) threat of material injury to such an
industry, or
(C) material retardation of the establishment
of an industry in the United States,
by reason of the sale of the subject vessel, an
affirmative vote on any of the issues shall be treated
as a vote that the determination should be affirmative.
(19) Ordinary course of trade.--The term ``ordinary
course of trade'' means the conditions and practices
which, for a reasonable time before the sale of the
subject vessel, have been normal in the shipbuilding
industry with respect to a like vessel. The
administering authority shall consider the following
sales and transactions, among others, to be outside the
ordinary course of trade:
(A) Sales disregarded under section
822(b)(1).
(B) Transactions disregarded under section
822(f)(2).
(20) Nonmarket economy country.--
(A) In general.--The term ``nonmarket economy
country'' means any foreign country that the
administering authority determines does not
operate on market principles of cost or pricing
structures, so that sales of vessels in such
country do not reflect the fair value of the
vessels.
(B) Factors to be considered.--In making
determinations under subparagraph (A) the
administering authority shall take into
account--
(i) the extent to which the currency
of the foreign country is convertible
into the currency of other countries,
(ii) the extent to which wage rates
in the foreign country are determined
by free bargaining between labor and
management,
(iii) the extent to which joint
ventures or other investments by firms
of other foreign countries are
permitted in the foreign country,
(iv) the extent of government
ownership or control of the means of
production,
(v) the extent of government control
over the allocation of resources and
over the price and output decisions of
enterprises, and
(vi) such other factors as the
administering authority considers
appropriate.
(C) Determination in effect.--
(i) Any determination that a foreign
country is a nonmarket economy country
shall remain in effect until revoked by
the administering authority.
(ii) The administering authority may
make a determination under subparagraph
(A) with respect to any foreign country
at any time.
(D) Determinations not in issue.--
Notwithstanding any other provision of law, any
determination made by the administering
authority under subparagraph (A) shall not be
subject to judicial review in any investigation
conducted under subtitle A.
(21) Shipbuilding agreement.--The term ``Shipbuilding
Agreement'' means The Agreement Respecting Normal
Competitive Conditions in the Commercial Shipbuilding
and Repair Industry, resulting from negotiations under
the auspices of the Organization for Economic
Cooperation and Development, and entered into on
December 21, 1994.
(22) Shipbuilding agreement party.--The term
``Shipbuilding Agreement Party'' means a state or
separate customs territory that is a Party to the
Shipbuilding Agreement, and with respect to which the
United States applies the Shipbuilding Agreement.
(23) WTO agreement.--The term ``WTO Agreement'' means
the Agreement defined in section 2(9) of the Uruguay
Round Agreements Act.
(24) WTO member.--The term ``WTO member'' means a
state, or separate customs territory (within the
meaning of Article XII of the WTO Agreement), with
respect to which the United States applies the WTO
Agreement.
(25) Trade representative.--The term ``Trade
Representative'' means the United States Trade
Representative.
(26) Affiliated persons.--The following persons shall
be considered to be ``affiliated'' or ``affiliated
persons'':
(A) Members of a family, including brothers
and sisters (whether by the whole or half
blood), spouse, ancestors, and lineal
descendants.
(B) Any officer or director of an
organization and such organization.
(C) Partners.
(D) Employer and employee.
(E) Any person directly or indirectly owning,
controlling, or holding with power to vote, 5
percent or more of the outstanding voting stock
or shares of any organization, and such
organization.
(F) Two or more persons directly or
indirectly controlling, controlled by, or under
common control with, any person.
(G) Any person who controls any other person,
and such other person.
For purposes of this paragraph, a person shall be
considered to control another person if the person is
legally or operationally in a position to exercise
restraint or direction over the other person.
(27) Injurious pricing.--The term ``injurious
pricing'' refers to the sale of a vessel at less than
fair value.
(28) Injurious pricing margin.--
(A) In general.--The term ``injurious pricing
margin'' means the amount by which the normal
value exceeds the export price of the subject
vessel.
(B) Magnitude of the injurious pricing
margin.--The magnitude of the injurious pricing
margin used by the Commission shall be--
(i) in making a preliminary
determination under section 803(a) in
an investigation (including any
investigation in which the Commission
cumulatively assesses the effect of
sales under paragraph (16)(F)(i)), the
injurious pricing margin or margins
published by the administering
authority in its notice of initiation
of the investigation; and
(ii) in making a final determination
under section 805(b), the injurious
pricing margin or margins most recently
published by the administering
authority before the closing of the
Commission's administrative record.
(29) Commercial interest reference rate.--The term
``Commercial Interest Reference Rate'' or ``CIRR''
means an interest rate that the administering authority
determines to be consistent with Annex III, and
appendices and notes thereto, of the Understanding on
Export Credits for Ships, resulting from negotiations
under the auspices of the Organization for Economic
Cooperation, and entered into on December 21, 1994.
(30) Antidumping.--
(A) WTO members.--In the case of a WTO
member, the term ``antidumping'' refers to
action taken pursuant to the Agreement on
Implementation of Article VI of the General
Agreement on Tariffs and Trade 1994.
(B) Other cases.--In the case of any country
that is not a WTO member, the term
``antidumping'' refers to action taken by the
country against the sale of a vessel at less
than fair value that is comparable to action
described in subparagraph (A).
(31) Broad multiple bid.--The term ``broad multiple
bid'' means a bid in which the proposed buyer extends
an invitation to at least all the producers in the
industry known by the buyer to be capable of building
the subject vessel.
* * * * * * *
----------
TITLE 28, UNITED STATES CODE
PART IV--JURISDICTION AND VENUE
* * * * * * *
CHAPTER 95--COURT OF INTERNATIONAL TRADE
* * * * * * *
Sec. 1581. Civil actions against the United States and agencies and
officers thereof
(a) * * *
* * * * * * *
(c) The Court of International Trade shall have exclusive
jurisdiction of any civil action commenced under section 516A
or 516B of the Tariff Act of 1930.
* * * * * * *
PART VI--PARTICULAR PROCEEDINGS
* * * * * * *
CHAPTER 169--COURT OF INTERNATIONAL TRADE PROCEDURE
* * * * * * *
Sec. 2643. Relief
(a) * * *
* * * * * * *
(c)(1) Except as provided in paragraphs (2), (3), (4), [and
(5)] (5), and (6) of this subsection, the Court of
International Trade may, in addition to the orders specified in
subsections (a) and (b) of this section, order any other form
of relief that is appropriate in a civil action, including, but
not limited to, declaratory judgments, orders of remand,
injunctions, and writes of mandamus and prohibition.
* * * * * * *
(6) In any civil action under section 516B of the Tariff Act
of 1930, the Court of International Trade may not issue
injunctions or any other form of equitable relief, except with
regard to implementation of a countermeasure order under
section 468 of that Act, upon a proper showing that such relief
is warranted.
* * * * * * *
----------
MERCHANT MARINE ACT, 1936
* * * * * * *
TITLE V--CONSTRUCTION-DIFFERENTIAL SUBSIDY
* * * * * * *
Sec. 511. (a) When used in this section the term ``new
vessel'' means any vessel (1) documented or agreed with the
Secretary of Transportation to be documented under the laws of
the United States; (2) constructed in the United States after
December 31, 1939, or, if the vessel is a Shipbuilding
Agreement vessel, constructed in a Shipbuilding Agreement
Party, but only with regard to moneys deposited, on or after
the date on which the Shipbuilding Trade Agreement Act takes
effect, into a construction reserve fund established under
subsection (b) or the construction of which has been financed
under title V or VII of this Act, as amended, or the
construction of which has been aided by a mortgage insured
under title XI of this Act as amended; and (3) either (A) of
such type, size, and speed as the Secretary of Transportation
shall determine to be suitable for use on the high seas or
Great Lakes in carrying out the purposes of this Act, but not
of less than two thousand gross tons or of less speed than
twelve knots, unless the Secretary of Transportation shall
determine and certify in each case that a vessel of a specified
lesser tonnage or speed is desirable for use by the United
States in case of war or national emergency, or (B) constructed
to replace a vessel or vessels requisitioned or purchased by
the United States.
* * * * * * *
TITLE VI--OPERATING-DIFFERENTIAL SUBSIDY
Sec. 601. (a) The Secretary of Transportation is authorized
and directed to consider the application of any citizen of the
United States for financial aid in the operation of a vessel or
vessels, which are to be used in an essential service in the
foreign commerce of the United States or in such service and in
cruises authorized under section 613 of this title. In this
title VI the term ``essential service'' means the operation of
a vessel on a service, route, or line described in section
211(a) or in bulk cargo carrying service described in section
211(b). No such application shall be approved by the Secretary
of Transportation unless he determines that (1) the operation
of such vessel or vessels in an essential service is required
to meet foreign-flag competition and to promote the foreign
commerce of the United States except to the extent such vessels
are to be operated on cruises authorized under section 613 of
this title[, and that such vessel or vessels were built in the
United States, or have been documented under the laws of the
United States not later than February 1, 1928, or actually
ordered and under construction for the account of citizens of
the United States prior to such date] and that such vessel or
vessels were built in the United States, or, if the vessel or
vessels are Shipbuilding Agreement vessels, in a Shipbuilding
Agreement Party; (2) the applicant owns or leases, or can and
will build or purchase or lease, a vessel or vessels of the
size, type, speed, and number, and with the proper equipment
required to enable him to operate in an essential service, in
such manner as may be necessary to meet competitive conditions,
and to promote foreign commerce; (3) the applicant possesses
the ability, experience, financial resources, and other
qualifications necessary to enable him to conduct the proposed
operations of the vessel or vessels as to meet competitive
conditions and promote foreign commerce; (4) the granting of
the aid applied for is necessary to place the proposed
operations of the vessel or vessels on a parity with those of
foreign competitors, and is reasonably calculated to carry out
effectively the purposes and policy of this Act. To the extent
the application covers cruises, as authorized under section 613
of this title, the Secretary of Transportation may make the
portion of this last determination relating to parity on the
basis that any foreign flag cruise from the United States
competes with any American flag cruise from the United States.
* * * * * * *
Sec. 606. Every contract for an operating-differential
subsidy under this title shall provide (1) that the amount of
the future payments to the contractor shall be subject to
review and readjustment from time to time, but not more
frequently than once a year, at the instance of the Secretary
of Transportation or of the contractor. If any such
readjustment cannot be reached by mutual agreement, the
Secretary of Transportation, on his own motion or on the
application of the contractor, shall, after a proper hearing,
determine the facts and make such readjustment in the amount of
such future payments as he may determine to be fair and
reasonable and in the public interest. The testimony in every
such proceeding shall be reduced to writing and filed in the
office of the Secretary of Transportation. His decision shall
be based upon and governed by the changes which may have
occurred since the date of the said contract, with respect to
the items theretofore considered and on which such contract was
based, and other conditions affecting shipping, and shall be
promulgated in a formal order, which shall be accompanied by a
report in writing in which the Secretary of Transportation
shall state his findings of fact; (2) that the compensation to
be paid under it shall be reduced, under such terms and in such
amounts as the Secretary of Transportation shall determine, for
any periods in which the vessel or vessels are laid up; (3)
that if the Secretary of Transportation shall determine that a
change in an essential service, which is receiving an
operating-differential subsidy under this title, is necessary
in the accomplishment of the purposes of this Act, he may make
such change upon such readjustment of payments to the
contractor as shall be arrived at by the method prescribed in
clause (1) of these conditions; (4) that if at any time the
contractor receiving an operating-differential subsidy claims
that he cannot maintain and operate his vessels in such an
essential service, with a reasonable profit upon his
investment, and applies to the Secretary of Transportation for
a modification or rescission of his contract to maintain such
essential service, and the Secretary of Transportation
determines that such claim is proved, the Secretary of
Transportation shall modify or rescind such contract and permit
the contractor to withdraw such vessels from such essential
service, upon a date fixed by the Secretary of Transportation,
and upon the date of such withdrawal the further payment of the
operating-differential subsidy shall cease and the contractor
be discharged from any further obligation under such contract;
(5) that the contractor shall conduct his operations with
respect to essential services, and any services authorized
under section 613 of this title, covered by his contract in an
economical and efficient manner; and (6) that whenever
practicable, an operator who receives subsidy with respect to
subsistence of officers and crews shall use as such subsistence
items only articles, materials, and supplies of the growth,
production, and manufacture of the United States, as defined in
section 505 herein, except when it is necessary to purchase
supplies outside the United States to enable such vessel to
continue and complete her voyage, and an operator who receives
subsidy with respect to repairs shall perform such repairs
within any of the United States or the Commonwealth of Puerto
Rico or, if the vessel is a Shipbuilding Agreement vessel, in a
Shipbuilding Agreement Party or in the United States, except in
an emergency.
Sec. 607. (a) Agreement Rules.
Any citizen of the United States owning or leasing one or
more eligible vessels (as defined in subsection (k)(1)) may
enter into an agreement with the Secretary under, and as
provided in, this section to establish a capital construction
fund (hereinafter in this section referred to as the ``fund'')
with respect to any or all of such vessels. Any agreement
entered into under this section shall be for the purpose of
providing replacement vessels, additional vessels, or
reconstructed vessels, built in the United States or, if the
vessel is a Shipbuilding Agreement vessel, in a Shipbuilding
Agreement Party, and documented under the laws of the United
States for operation in the United States foreign, Great Lakes,
or noncontiguous domestic trade or in the fisheries of the
United States and shall provide for the deposit in the fund of
the amounts agreed upon as necessary or appropriate to provide
for qualified withdrawals under subsection (f). The deposits in
the fund, and all withdrawals from the fund, whether qualified
or nonqualified, shall be subject to such conditions and
requirements as the Secretary may by regulations prescribe or
are set forth in such agreement; except that the Secretary may
not require any person to deposit in the fund for any taxable
year more than 50 percent of that portion of such person's
taxable income for such year (computed in the manner provided
in subsection (b)(1)(A)) which is attributable to the operation
of the agreement vessels.
* * * * * * *
(k) Definitions.
For purposes of this section--
(1) The term ``eligible vessel'' means any vessel--
[(A) constructed in the United States and, if
reconstructed, reconstructed in the United States,]
(A)(i) constructed in the United States and, if
reconstructed, reconstructed in the United States or in
a Shipbuilding Agreement Party, or
(ii) that is a Shipbuilding Agreement vessel and is
constructed in a Shipbuilding Agreement Party and, if
reconstructed, is reconstructed in a Shipbuilding
Agreement Party or in the United States,
* * * * * * *
(2) The term ``qualified vessel'' means any vessel--
[(A) constructed in the United States and, if
reconstructed, reconstructed in the United States,]
(A)(i) constructed in the United States and, if
reconstructed, reconstructed in the United States or in
a Shipbuilding Agreement Party, or
(ii) that is a Shipbuilding Agreement vessel and is
constructed in a Shipbuilding Agreement Party and, if
reconstructed, is reconstructed in a Shipbuilding
Agreement Party or in the United States, but only with
regard to moneys deposited into the fund on or after
the date on which the Shipbuilding Trade Agreement Act
takes effect,
* * * * * * *
Sec. 610. An operating-differential subsidy shall not be paid
under authority of this title on account of the operation of
any vessel which does not meet the following requirements: (1)
The vessel shall be of steel or other acceptable metal, shall
be propelled by steam or motor, shall be as nearly fireproof as
practicable, [shall be built in a domestic yard or shall have
been documented under the laws of the United States not later
than February 1, 1928, or actually ordered and under
construction for the account of citizens of the United States
prior to such date,] shall be built in the United States or, if
the vessel is a Shipbuilding Agreement vessel, in a
Shipbuilding Agreement Party, and shall be documented under the
laws of the United States, during the entire life of the
subsidy contract; and (2) if the vessel shall be constructed
after the passage of this Act it shall be either a vessel
constructed according to plans and specifications approved by
the Secretary of Transportation and the Secretary of the Navy,
with particular reference to economical conversion into an
auxiliary naval vessel, or a vessel approved by the Secretary
of Transportation and the Navy Department as otherwise useful
to the United States in time of national emergency.
* * * * * * *
TITLE IX--MISCELLANEOUS PROVISIONS
Sec. 901. (a) * * *
(b)(1) Whenever the United States shall procure, contract
for, or otherwise obtain for its own account, or shall furnish
to or for the account of any foreign nation without provision
for reimbursement, any equipment, materials, or commodities,
within or without the United States, or shall advance funds or
credits or guarantee the convertibility of foreign currencies
in connection with the furnishing of such equipment, materials,
or commodities, the appropriate agency or agencies shall take
such steps as may be necessary and practicable to assure that
at least 50 per centum of the gross tonnage of such equipment,
materials or commodities (computed separately for dry bulk
carriers, dry cargo liners, and tankers), which may be
transported on ocean vessels shall be transported on privately
owned United States-flag commercial vessels, to the extent such
vessels are available at fair and reasonable rates for United
States-flag commercial vessels, in such manner as will insure a
fair and reasonable participation of United States-flag
commercial vessels in such cargoes by geographical areas:
Provided, That the provisions of this subsection may be waived
whenever the Congress by concurrent resolution or otherwise, or
the President of the United States or the Secretary of Defense
declares that an emergency exists justifying a temporary waiver
of the provisions of section 901(b)(1) and so notifies the
appropriate agency or agencies: And provided further, That the
provisions of this subsection shall not apply to cargoes
carried in the vessels of the Panama Canal Company. Nothing
herein shall repeal or otherwise modify the provisions of
Public Resolution Numbered 17, Seventy-third Congress (48 Stat.
500), as amended. [For purposes of this section, the term
``privately owned United States-flag commercial vessels'' shall
not be deemed to include any vessel which, subsequent to the
date of enactment of this amendment, shall have been either (a)
built outside the United States, (b) rebuilt outside the United
States, or (c) documented under any foreign registry, until
such vessel shall have been documented under the laws of the
United States, for a period of three years: Provided, however,
That the provisions of this amendment shall not apply where,
(1) prior to the enactment of this amendment, the owner of a
vessel, or contractor for the purchase of a vessel, originally
constructed in the United States and rebuilt abroad or
contracted to be rebuilt abroad, has notified the Maritime
Administration in writing of its intent to document such vessel
under United States registry, and such vessel is so documented
on its first arrival at a United States port not later than one
year subsequent to the date of the enactment of this amendment,
or (2) where prior to the enactment of this amendment, the
owner of a vessel under United States registry has made a
contract for the rebuilding abroad of such vessel and has
notified the Maritime Administration of such contract, and such
rebuilding is completed and such vessel is thereafter
documented under United States registry on its first arrival at
a United States port not later than one year subsequent to the
date of the enactment of this amendment.] For purposes of this
section, the term ``privately owned United States-flag
commercial vessels'' shall be deemed to include--
(A) any privately owned United States-flag commercial
vessel constructed in the United States, and if
rebuilt, rebuilt in the United States or in a
Shipbuilding Agreement Party on or after the date on
which the Shipbuilding Trade Agreement Act takes
effect, and
(B) any privately owned vessel constructed in a
Shipbuilding Agreement Party on or after the date on
which the Shipbuilding Trade Agreement Act takes
effect, and if rebuilt, rebuilt in a Shipbuilding
Agreement Party or in the United States, that is
documented pursuant to chapter 121 of title 46, United
States Code.
The term ``privately owned United States-flag commercial
vessels'' shall also be deemed to include any cargo vessel that
so qualified pursuant to section 615 of this Act or this
paragraph before the date on which the Shipbuilding Trade
Agreement Act takes effect. The term ``privately owned United
States-flag commercial vessels'' shall not be deemed to include
any liquid bulk cargo vessel that does not meet the
requirements of section 3703a of title 46, United States Code.
* * * * * * *
Sec. 905. When used in this Act--
(a) * * *
* * * * * * *
(h) The term ``Shipbuilding Agreement'' means the Agreement
Respecting Normal Competitive Conditions in the Commercial
Shipbuilding and Repair Industry, which resulted from
negotiations under the auspices of the Organization for
Economic Cooperation and Development, and was entered into on
December 21, 1994.
(i) The term ``Shipbuilding Agreement Party'' means a state
or separate customs territory that is a Party to the
Shipbuilding Agreement, and with respect to which the United
States applies the Shipbuilding Agreement.
(j) The term ``Shipbuilding Agreement vessel'' means a vessel
to which the Secretary determines Article 2.1 of the
Shipbuilding Agreement applies.
(k) The term ``Export Credit Understanding'' means the
Understanding on Export Credits for Ships which resulted from
negotiations under the auspices of the Organization for
Economic Cooperation and Development and was entered into on
December 21, 1994.
(l) The term ``Export Credit Understanding vessel'' means a
vessel to which the Secretary determines the Export Credit
Understanding applies.
* * * * * * *
TITLE XI--FEDERAL SHIP MORTGAGE INSURANCE
* * * * * * *
Sec. 1104A. (a) * * *
(b) Obligations guaranteed under this title--
(1) * * *
* * * * * * *
[(5) shall bear interest (exclusive of charges for
the guarantee and service charges, if any) at rates not
to exceed such per centum per annum on the unpaid
principal as the Secretary determines to be reasonable,
taking into account the range of interest rates
prevailing in the private market for similar loans and
the risks assumed by the Secretary;]
(5) shall bear interest (exclusive of charges for the
guarantee and service charges, if any) at rates not to
exceed such percent per annum on the unpaid principal
as the Secretary determines to be reasonable, taking
into account the range of interest rates prevailing in
the private market for similar loans and the risks
assumed by the Secretary, except that, with respect to
Export Credit Understanding vessels, and Shipbuilding
Agreement vessels, the obligations shall bear interest
at a rate the Secretary determines to be consistent
with obligations of the United States under the Export
Credit Understanding or the Shipbuilding Agreement, as
the case may be;
* * * * * * *
[(i) The Secretary may not, with respect to--
[(1) the general 75 percent or less limitation in
subsection (b)(2);
[(2) the 87\1/2\ percent or less limitation in the
1st, 2nd, 4th, or 5th proviso to subsection (b)(2) or
section 1112(b); or
[(3) the 80 percent or less limitation in the 3rd
proviso to such subsection;
establish by rule, regulation, or procedure any percentage
within any such limitation that is, or is intended to be,
applied uniformly to all guarantees or commitments to guarantee
made under this section that are subject to the limitation.]
(i)(1) Except as provided in paragraph (2), the Secretary may
not, with respect to--
(A) the general 75 percent or less limitation
contained in subsection (b)(2),
(B) the 87\1/2\ percent or less limitation contained
in the 1st, 2nd, 4th, or 5th proviso to subsection
(b)(2) or in section 1112(b), or
(C) the 80 percent or less limitation in the 3rd
proviso to such subsection,
establish by rule, regulation, or procedure any percentage
within any such limitation that is, or is intended to be,
applied uniformly to all guarantees or commitments to guarantee
made under this section that are subject to the limitation.
(2) With respect to Export Credit Understanding vessels and
Shipbuilding Agreement vessels, the Secretary may establish by
rule, regulation, or procedure a uniform percentage that the
Secretary determines to be consistent with obligations of the
United States under the Export Credit Understanding or the
Shipbuilding Agreement, as the case may be.
* * * * * * *
Sec. 1104B. (a) * * *
(b) For the purposes of this section--
(1) the maximum term for obligations guaranteed under
this program may not exceed 25 years;
(2) obligations guaranteed may not exceed 87\1/2\
percent of the actual cost or depreciated actual cost
to the applicant for the construction or reconstruction
of the vessel; and
(3) reconstruction cost obligations may not be
guaranteed unless the vessel after reconstruction will
have a useful life of at least 15 years.
The Secretary may not by rule, regulation, or procedure
establish any percentage within the 87\1/2\ percent or less
limitation in paragraph (2) that is, or is intended to be,
applied uniformly to all guarantees or commitments to guarantee
made under this section[.], except that, with respect to Export
Credit Understanding vessels and Shipbuilding Agreement
vessels, the Secretary may establish by rule, regulation, or
procedure a uniform percentage that the Secretary determines to
be consistent with obligations of the United States under the
Export Credit Understanding or the Shipbuilding Agreement, as
the case may be.
* * * * * * *
----------
INTERNAL REVENUE CODE OF 1986
Subtitle A--Income Taxes
CHAPTER 1--NORMAL TAXES AND SURTAXES
* * * * * * *
Subchapter N--Tax Based on Income From Sources Within or Without the
United States
* * * * * * *
PART II--NONRESIDENT ALIENS AND FOREIGN CORPORATIONS
Subpart A--Nonresident Alien Individuals
* * * * * * *
SEC. 872. GROSS INCOME
(a) * * *
(b) Exclusions.--The following items shall not be included in
gross income of a nonresident alien individual, and shall be
exempt from taxation under this subtitle:
(1) Ships operated by certain nonresidents.--[Gross
income] Except as provided in section 883(d), gross
income derived by an individual resident of a foreign
country from the international operation of a ship or
ships if such foreign country grants an equivalent
exemption to individual residents of the United States.
* * * * * * *
Subpart B--Foreign Corporations
* * * * * * *
SEC. 883. EXCLUSIONS FROM GROSS INCOME
(a) Income of Foreign Corporations From Ships and Aircraft.--
The following items shall not be included in gross income of a
foreign corporation, and shall be exempt from taxation under
this subtitle:
(1) Ships operated by certain foreign corporations.--
[Gross income] Except as provided in subsection (d),
gross income derived by a corporation organized in a
foreign country from the international operation of a
ship or ships if such foreign country grants an
equivalent exemption to corporations organized in the
United States.
* * * * * * *
(d) Penalties for Failure to Disclose Position That Certain
International Shipping Income Is Not Includible in Gross
Income.--
(1) In general.--A taxpayer who, with respect to any
tax imposed by this title, takes the position that any
of its gross income derived from the international
operation of a ship or ships is not includible in gross
income by reason of subsection (a)(1) or section
872(b)(1) shall be entitled to such treatment only if
such position is disclosed (in such manner as the
Secretary may prescribe) on the return of tax for such
tax (or any statement attached to such return).
(2) Additional penalties for failing to disclose
position.--If a taxpayer fails to meet the requirement
of paragraph (1) with respect to any taxable year--
(A) the amount of the income from the
international operation of a ship or ships--
(i) which is from sources without the
United States, and
(ii) which is attributable to a fixed
place of business in the United States,
shall be treated for purposes of this title as
effectively connected with the conduct of a
trade or business within the United States, and
(B) no deductions or credits shall be allowed
which are attributable to income from the
international operation of a ship or ships.
(3) Reasonable cause exception.--This subsection
shall not apply to a failure to disclose a position if
it is shown that such failure is due to reasonable
cause and not due to willful neglect.
* * * * * * *
