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107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     107-518

======================================================================



 
RELATING TO CONSIDERATION OF THE SENATE AMENDMENT TO THE BILL (H.R. 
  3009) TO EXTEND THE ANDEAN TRADE PREFERENCE ACT, TO GRANT ADDITIONAL 
  TRADE BENEFITS UNDER THAT ACT, AND FOR OTHER PURPOSES

                                _______
                                

   June 19, 2002.--Referred to the House Calendar and ordered to be 
                                printed

                                _______
                                

   Mr. Reynolds, from the Committee on Rules, submitted the following

                              R E P O R T

                       [To accompany H. Res. 450]

    The Committee on Rules, having had under consideration 
House Resolution 450, by a non-record vote, report the same to 
the House with the recommendation that the resolution be 
adopted.

                SUMMARY OF PROVISIONS OF THE RESOLUTION

    The resolution provides that H.R. 3009 and the Senate 
amendment thereto, shall be taken from the Speaker's table and 
agreed to with the amendment printed in this report.
    The rule provides that the House shall be considered to 
have insisted on its amendment to the Senate amendment.
    Finally, the rule provides that the House shall be 
considered to have requested a conference with the Senate 
thereon.

                          SUMMARY OF AMENDMENT

     Includes the Bipartisan Trade Promotion Authority 
Act of 2001 (H.R. 3005), as passed by the House on Dec. 6, 
2001.
     Incorporates into the Trade Promotion Authority 
bill the language from the English Resolution (H. Con. Res. 
262) expressing Congressional concerns regarding WTO dispute 
settlement panels and the WTO Appellate Body, and the standard 
of review contained in Article 17.6 of the Antidumping 
Agreement, as passed by the House Nov. 7, 2001 by a vote of 
410-4.
     Includes the Andean Trade Preference and Drug 
Eradication Act (H.R. 3009), as passed by the House on Nov. 16, 
2001 by voice vote.
     Requires that for apparel made with U.S. fabric to 
qualify for benefits under the Caribbean Basin Initiative and 
the Andean Trade Preference Act, all dyeing and finishing of 
that fabric must take place in the United States, as passed by 
the House as part of the supplemental appropriations 
legislation (sec. 1405 of H.R. 4775) on May 24, 2002.
     Includes the Customs Border Security Act (H.R. 
3129), as passed by the House on May 22, 2002 by a vote of 327-
101.
     Extends the Generalized System of Preferences 
(H.R. 3010) as reported by the Committee on Ways & Means on 
Oct. 16, 2001.
     Expands coverage and benefits under Trade 
Adjustment Assistance by:
         Expanding coverage to secondary workers by 
        covering certain suppliers;
         Adding a 60% health insurance tax credit to 
        TAA recipients, and extending same health insurance tax 
        credit on a permanent basis to Pension Benefits 
        Guarantee Corporation beneficiaries, including firms 
        from airline and steel industries;
         Extending direct assistance benefits for 26 
        additional weeks in order to help workers complete 
        their training requirements, and speeding up the 
        petition process from the current 60 days to a new 40 
        days providing assistance to workers faster; and
         Increasing funding for worker training from 
        $80 to $110 million for the increased number of workers 
        eligible under TAA.
     Authorizes the payment of judgments to avoid 
sanctions from certain WTO dispute settlement cases.
     Requires that Customs collect duties from 
importers on a monthly basis and prohibition on deferral of 
duties beyond the specified duty collection period.

                           TEXT OF AMENDMENT

  In lieu of the matter proposed to be inserted by the Senate 
amendment, insert the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Trade Act of 2002''.

SEC. 2. ORGANIZATION OF ACT INTO DIVISIONS; TABLE OF CONTENTS.

  (a) Divisions.--This Act is organized into 4 divisions as 
follows:
          (1) Division a.--Trade Adjustment Assistance.
          (2) Division b.--Bipartisan Trade Promotion 
        Authority.
          (3) Division c.--Andean Trade Preference Act.
          (4) Division d.--Extension of Certain Preferential 
        Trade Treatment and Other Provisions.
  (b) Table of Contents.--The table of contents for this Act is 
as follows:

Sec. 1. Short title.
Sec. 2. Organization of act into divisions; table of contents.

                 DIVISION A--TRADE ADJUSTMENT ASSISTANCE

Sec. 101. Short title.

              TITLE I--TRADE ADJUSTMENT ASSISTANCE PROGRAM

Sec. 111. Reauthorization of trade adjustment assistance program.
Sec. 112. Filing of petitions and provision of rapid response 
          assistance; expedited review of petitions by Secretary of 
          Labor.
Sec. 113. Group eligibility requirements.
Sec. 114. Qualifying requirements for trade readjustment allowances.
Sec. 115. Waivers of training requirements.
Sec. 116. Amendments to limitations on trade readjustment allowances.
Sec. 117. Annual total amount of payments for training.
Sec. 118. Authority of States with respect to costs of approved training 
          and supplemental assistance.
Sec. 119. Provision of employer-based training.
Sec. 120. Coordination with title I of the Workforce Investment Act of 
          1998.
Sec. 121. Expenditure period.
Sec. 122. Declaration of policy; sense of Congress.

   TITLE II--CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS

Sec. 201.  Credit for health insurance costs of individuals receiving a 
          trade readjustment allowance or a benefit from the Pension 
          Benefit Guaranty Corporation.
Sec. 202.  Advance payment of credit for health insurance costs of 
          eligible individuals.

                   TITLE III--CUSTOMS REAUTHORIZATION

Sec. 301. Short title.

                Subtitle A--United States Customs Service

   Chapter 1--Drug Enforcement and Other Noncommercial and Commercial 
                               Operations

Sec. 311. Authorization of appropriations for noncommercial operations, 
          commercial operations, and air and marine interdiction.
Sec. 312. Antiterrorist and illicit narcotics detection equipment for 
          the United States-Mexico border, United States-Canada border, 
          and Florida and the Gulf Coast seaports.
Sec. 313. Compliance with performance plan requirements.

     Chapter 2--Child Cyber-Smuggling Center of the Customs Service

Sec. 321. Authorization of appropriations for program to prevent child 
          pornography/child sexual exploitation.

                   Chapter 3--Miscellaneous Provisions

Sec. 331. Additional Customs Service officers for United States-Canada 
          border.
Sec. 332. Study and report relating to personnel practices of the 
          Customs Service.
Sec. 333. Study and report relating to accounting and auditing 
          procedures of the Customs Service.
Sec. 334. Establishment and implementation of cost accounting system; 
          reports.
Sec. 335. Study and report relating to timeliness of prospective 
          rulings.
Sec. 336. Study and report relating to customs user fees.
Sec. 337. Fees for customs inspections at express courier facilities.
Sec. 338. National customs automation program.

                   Chapter 4--Antiterrorism Provisions

Sec. 341. Immunity for United States officials that act in good faith.
Sec. 342. Emergency adjustments to offices, ports of entry, or staffing 
          of the customs service.
Sec. 343. Mandatory advanced electronic information for cargo and 
          passengers.
Sec. 344. Border search authority for certain contraband in outbound 
          mail.
Sec. 345. Authorization of appropriations for reestablishment of customs 
          operations in New York City.

               Chapter 5--Textile Transshipment Provisions

Sec. 351. Gao audit of textile transshipment monitoring by customs 
          service.
Sec. 352. Authorization of appropriations for textile transshipment 
          enforcement operations.
Sec. 353. Implementation of the african growth and opportunity act.

      Subtitle B--Office of the United States Trade Representative

Sec. 361. Authorization of appropriations.

        Subtitle C--United States International Trade Commission

Sec. 371. Authorization of appropriations.

                   Subtitle D--Other trade provisions

Sec. 381. Increase in aggregate value of articles exempt from duty 
          acquired abroad by United States residents.
Sec. 382. Regulatory audit procedures.

            DIVISION B--BIPARTISAN TRADE PROMOTION AUTHORITY

                  TITLE XXI--TRADE PROMOTION AUTHORITY

Sec. 2101. Short title and findings.
Sec. 2102. Trade negotiating objectives.
Sec. 2103. Trade agreements authority.
Sec. 2104. Consultations and assessment.
Sec. 2105. Implementation of trade agreements.
Sec. 2106. Treatment of certain trade agreements for which negotiations 
          have already begun.
Sec. 2107. Congressional oversight group.
Sec. 2108. Additional implementation and enforcement requirements.
Sec. 2109. Committee staff.
Sec. 2110. Conforming amendments.
Sec. 2111. Definitions.

                 DIVISION C--ANDEAN TRADE PREFERENCE ACT

                   TITLE XXXI--ANDEAN TRADE PREFERENCE

Sec. 3101. Short title.
Sec. 3102. Findings.
Sec. 3103. Articles eligible for preferential treatment.
Sec. 3104. Termination of preferential treatment.
Sec. 3105. Trade benefits under the Caribbean Basin Economic Recovery 
          act.
Sec. 3106. Trade benefits under the African Growth and Opportunity Act.

DIVISION D--EXTENSION OF CERTAIN PREFERENTIAL TRADE TREATMENT AND OTHER 
                               PROVISIONS

Sec. 4101. Extension of generalized system of preferences.
Sec. 4102. Fund for WTO dispute settlements.
Sec. 4103. Payment of duties and fees.

                DIVISION A--TRADE ADJUSTMENT ASSISTANCE

SEC. 101. SHORT TITLE.

  This division may be cited as the ``Trade Adjustment 
Assistance Reform Act of 2002''.

              TITLE I--TRADE ADJUSTMENT ASSISTANCE PROGRAM

SEC. 111. REAUTHORIZATION OF TRADE ADJUSTMENT ASSISTANCE PROGRAM.

  (a) Assistance for Workers.--Section 245 of the Trade Act of 
1974 (19 U.S.C. 2317) is amended by striking ``October 1, 1998, 
and ending September 30, 2001,'' each place it appears and 
inserting ``October 1, 2001, and ending September 30, 2004,''.
  (b) Assistance for Firms.--Section 256(b) of the Trade Act of 
1974 (19 U.S.C. 2346(b)) is amended by striking ``October 1, 
1998, and ending September 30, 2001'' and inserting ``October 
1, 2001, and ending September 30, 2004,''.
  (c) Termination.--Section 285(c) of the Trade Act of 1974 (19 
U.S.C. 2271 note) is amended in paragraphs (1) and (2)(A) by 
striking ``September 30, 2001'' and inserting ``September 30, 
2004''.
  (d) Training Limitation Under NAFTA Program.--Section 
250(d)(2) of the Trade Act of 1974 (19 U.S.C. 2331(d)(2)) is 
amended by striking ``October 1, 1998, and ending September 30, 
2001'' and inserting ``October 1, 2001, and ending September 
30, 2004''.

SEC. 112. FILING OF PETITIONS AND PROVISION OF RAPID RESPONSE 
                    ASSISTANCE; EXPEDITED REVIEW OF PETITIONS BY 
                    SECRETARY OF LABOR.

  (a) Filing of Petitions and Provision of Rapid Response 
Assistance.--Section 221(a) of the Trade Act of 1974 (19 U.S.C. 
2271(a)) is amended to read as follows:
  ``(a)(1) A petition for certification of eligibility to apply 
for adjustment assistance for a group of workers under this 
chapter may be filed with the Governor of the State in which 
such workers' firm or subdivision is located by any of the 
following:
          ``(A) The group of workers (including workers in an 
        agricultural firm or subdivision of any agricultural 
        firm).
          ``(B) The certified or recognized union or other duly 
        authorized representative of such workers.
          ``(C) Employers of such workers, one-stop operators 
        or one-stop partners (as defined in section 101 of the 
        Workforce Investment Act of 1998 (29 U.S.C. 2801)), 
        including State employment security agencies, or the 
        State dislocated worker unit established under title I 
        of such Act, on behalf of such workers.
  ``(2) Upon receipt of a petition filed under paragraph (1), 
the Governor shall--
          ``(A) immediately transmit the petition to the 
        Secretary of Labor (hereinafter in this chapter 
        referred to as the `Secretary');
          ``(B) ensure that rapid response assistance, and 
        appropriate core and intensive services (as described 
        section 134 of the Workforce Investment Act of 1998 (29 
        U.S.C. 2864)) authorized under other Federal laws are 
        made available to the workers covered by the petition 
        to the extent authorized under such laws; and
          ``(C) assist the Secretary in the review of the 
        petition by verifying such information and providing 
        such other assistance as the Secretary may request.
  ``(3) Upon receipt of the petition, the Secretary shall 
promptly publish notice in the Federal Register that the 
Secretary has received the petition and initiated an 
investigation.''.
  (b) Expedited Review of Petitions by Secretary of Labor.--
Section 223(a) of such Act (19 U.S.C. 2273(a)) is amended in 
the first sentence by striking ``60 days'' and inserting ``40 
days''.

SEC. 113. GROUP ELIGIBILITY REQUIREMENTS.

  (a) Trade Adjustment Assistance Program.--
          (1) In general.--Section 222 of the Trade Act of 1974 
        (19 U.S.C. 2272) is amended--
                  (A) by redesignating subsection (b) as 
                subsection (c); and
                  (B) by inserting after subsection (a) the 
                following:
  ``(b)(1) A group of workers (including workers in any 
agricultural firm or subdivision of an agricultural firm) shall 
be certified by the Secretary as eligible to apply for 
adjustment assistance benefits under this subchapter if, 
subject to paragraph (2), the Secretary determines that--
          ``(A) a significant number or proportion of the 
        workers in the workers' firm or an appropriate 
        subdivision of the firm have become totally or 
        partially separated, or are threatened to become 
        totally or partially separated;
          ``(B) the workers' firm (or subdivision) is a 
        supplier to a firm (or subdivision) that employed 
        workers covered by a certification of eligibility under 
        subsection (a), the component parts provided to the 
        firm by the supplier is a direct component of the 
        article that is the basis for the certification of 
        eligibility under subsection (a), and either the 
        component parts have a dedicated usage for the firm and 
        the supplier does not have another reasonably available 
        purchaser, or the component parts add at least 25 
        percent of the value to the article involved; and
          ``(C) a loss of business with the firm (or 
        subdivision) covered by the certification of 
        eligibility under subsection (a) contributed 
        importantly to the workers' separation or threat of 
        separation determined under subparagraph (A).
  ``(2) A group of workers shall be eligible for certification 
by the Secretary under paragraph (1) if the petition for 
certification is filed with the Secretary not later than 6 
months after the date on which the Secretary certifies the 
group of workers in the firm (or subdivision of the firm) under 
subsection (a) with respect to which the firm involved is a 
supplier.''.
          (2) Definitions.--Section 222(c) of such Act, as 
        redesignated by paragraph (1)(A), is amended--
                  (A) in the matter preceding paragraph (1), by 
                striking ``subsection (a)(3)'' and inserting 
                ``this section''; and
                  (B) by adding at the end the following:
          ``(3) The term `supplier' means a firm that produces 
        component parts for articles produced by a firm (or 
        subdivision) that employed a group of workers covered 
        by a certification of eligibility under subsection (a) 
        and with respect to which the production of such 
        component parts constitutes not less than 50 percent of 
        the total operations or production of the firm.''.
  (b) NAFTA Transitional Adjustment Assistance Program.--
          (1) In general.--Section 250(a) of the Trade Act of 
        1974 (19 U.S.C. 2331(a)) is amended--
                  (A) by redesignating paragraphs (2) and (3) 
                as paragraphs (3) and (4), respectively; and
                  (B) by inserting after paragraph (1) the 
                following:
          ``(2) Criteria for adversely affected secondary 
        workers.--(A) A group of workers (including workers in 
        any agricultural firm or subdivision of an agricultural 
        firm) shall be certified by the Secretary as eligible 
        to apply for adjustment assistance benefits under this 
        subchapter if, subject to subparagraph (B), the 
        Secretary determines that--
                  ``(i) a significant number or proportion of 
                the workers in the workers' firm or an 
                appropriate subdivision of the firm have become 
                totally or partially separated, or are 
                threatened to become totally or partially 
                separated;
                  ``(ii) the workers' firm (or subdivision) is 
                a supplier to a firm (or subdivision) that 
                employed workers covered by a certification of 
                eligibility under paragraph (1), the component 
                parts provided to the firm by the supplier is a 
                direct component of the article that is the 
                basis for the certification of eligibility 
                under subsection (a), and either the component 
                parts have a dedicated usage for the firm and 
                the supplier does not have another reasonably 
                available purchaser, or the component parts add 
                at least 25 percent of the value to the article 
                involved; and
                  ``(iii) a loss of business with the firm (or 
                subdivision) covered by the certification of 
                eligibility under paragraph (1) contributed 
                importantly to the workers' separation or 
                threat of separation determined under clause 
                (i).
          ``(B) A group of workers shall be eligible for 
        certification by the Secretary under subparagraph (A) 
        if the petition for certification is filed with the 
        Secretary not later than 6 months after the date on 
        which the Secretary certifies the group of workers in 
        the firm (or subdivision of the firm) under paragraph 
        (1) with respect to which the firm involved is a 
        supplier.''.
          (2) Definitions.--Section 250(a)(3) of such Act, as 
        redesignated by paragraph (1)(A), is amended to read as 
        follows:
          ``(3) Definitions.--In this section:
                  ``(A) The term `contributed importantly' 
                means a cause which is important but not 
                necessarily more important than any other 
                cause.
                  ``(B) The term `supplier' means a firm that 
                produces component parts for articles produced 
                by a firm (or subdivision) covered by a 
                certification of eligibility under paragraph 
                (1) and with respect to which the production of 
                such component parts constitutes not less than 
                50 percent of the total operations or 
                production of the firm.''.
          (3) Regulations.--Section 250(a)(4) of such Act, as 
        redesignated by paragraph (1)(A), is amended by 
        striking ``paragraph (1)'' and inserting ``paragraphs 
        (1) and (2)''.

SEC. 114. QUALIFYING REQUIREMENTS FOR TRADE READJUSTMENT ALLOWANCES.

  (a) Clarification of Certain Reductions.--(1) Section 
231(a)(3)(B) of the Trade Act of 1974 (19 U.S.C. 2291(a)(3)(B)) 
is amended by inserting after ``any unemployment insurance'' 
the following: ``, except additional compensation that is 
funded by a State and is not reimbursed from any Federal 
funds,''.
  (2) Section 233(a)(1) of the Trade Act of 1974 (19 U.S.C. 
2293(a)(1)) is amended by inserting after ``any unemployment 
insurance'' the following: ``, except additional compensation 
that is funded by a State and is not reimbursed from any 
Federal funds,''.
  (b) Enrollment in Training Requirement.--Section 231(a)(5)(A) 
of such Act (19 U.S.C. 2291(a)(5)(A)) is amended--
          (1) by inserting ``(i)'' after ``(A)'';
          (2) by adding ``and'' after the comma at the end; and
          (3) by adding at the end the following:
                  ``(ii) the enrollment required under clause 
                (i) occurs no later than the latest of--
                          ``(I) the last day of the 13th week 
                        after the worker's most recent total 
                        separation from adversely affected 
                        employment which meets the requirements 
                        of paragraphs (1) and (2);
                          ``(II) the last day of the 8th week 
                        after the week in which the Secretary 
                        issues a certification covering the 
                        worker;
                          ``(III) 45 days after the later of 
                        the dates specified in subclause (I) or 
                        (II), if the Secretary determines there 
                        are extenuating circumstances that 
                        justify an extension in the enrollment 
                        period; or
                          ``(IV) the last day of a period 
                        determined by the Secretary to be 
                        approved for enrollment after the 
                        termination of a waiver issued pursuant 
                        to subsection (c).''.-

SEC. 115. WAIVERS OF TRAINING REQUIREMENTS.

  (a) In General.--Section 231(c) of the Trade Act of 1974 (19 
U.S.C. 2291(c)) is amended to read as follows:
  ``(c)(1) The Secretary may issue a written statement to a 
worker waiving the enrollment in the training requirement 
described in subsection (a)(5)(A) if the Secretary determines 
that such training requirement is not feasible or appropriate 
for the worker, as indicated by 1 or more of the following:
          ``(A) The worker has been provided a written notice 
        that the worker will be recalled by the firm from which 
        the qualifying separation occurred and that such recall 
        will occur within 6 months of the qualifying 
        separation.
          ``(B) The worker is within 2 years of meeting all 
        requirements for entitlement to old-age insurance 
        benefits under title II of the Social Security Act (42 
        U.S.C. 401 et seq.) (except for application therefore) 
        as of the date of the most recent separation of the 
        worker that meets the requirements of subsection (a)(1) 
        and (2).
          ``(C) The worker is unable to participate in training 
        due to the health of the worker, except that a waiver 
        under this subparagraph shall not be construed to 
        exempt a worker from requirements relating to the 
        availability for work, active search for work, or 
        refusal to accept work under Federal or State 
        unemployment compensation laws.
          ``(D) The first available enrollment date for the 
        approved training of the worker is within 45 days after 
        the date of the determination made under this 
        paragraph, or, if later, there are extenuating 
        circumstances for the delay in enrollment, as 
        determined pursuant to guidelines issued by the 
        Secretary.
          ``(E) There are insufficient funds available for 
        training under this chapter, and funds are not 
        available for the approved training under other Federal 
        law.
  ``(2) The Secretary shall specify the duration of the waiver 
under paragraph (1)-and shall periodically review the waiver to 
determine whether the basis for issuing the waiver remains 
applicable. If at any time the Secretary determines such basis 
is no longer applicable to the worker, the Secretary shall 
revoke the waiver.
  ``(3) Pursuant to the agreement under section 239, the 
Secretary may authorize a cooperating State or State agency to 
carry out activities described in paragraph (1) (except for the 
determination under subparagraph (E) of paragraph (1)). Such 
agreement shall include a requirement that the State or State 
agency maintain and make available to the Secretary the written 
statements provided pursuant to paragraph (1) and a statement 
of the reasons for the waiver.
  ``(4) The Secretary shall collect and maintain information 
identifying the number of workers who received waivers and the 
average duration of such waivers issued under this subsection 
during the preceding year.''.
  (b) Conforming Amendment.--Section 231(a)(5)(C) of such Act 
(19 U.S.C. 2291(a)(5)(C)) is amended by striking ``certified''.

SEC. 116. AMENDMENTS TO LIMITATIONS ON TRADE READJUSTMENT ALLOWANCES.

  (a) Increase in Maximum Number of Weeks.--Section 233(a) of 
the Trade Act of 1974 (19 U.S.C. 2293(a)) is amended--
          (1) in paragraph (2), by inserting after ``104-week 
        period'' the following: ``(or, in the case of an 
        adversely affected worker who requires a program of 
        remedial education (as described in section 
        236(a)(5)(D)) in order to complete training approved 
        for the worker under section 236, the 130-week 
        period)''; and
          (2) in paragraph (3), by striking ``26'' each place 
        it appears and inserting ``52''.
  (b) Special Rule Relating to Break in Training.--Section 
233(f) of the Trade Act of 1974 (19 U.S.C. 2293(f)) is amended 
in the matter preceding paragraph (1) by striking ``14 days'' 
and inserting ``30 days''.
  (c) Additional Weeks for Individuals in Need of Remedial 
Education.--Section 233 of the Trade Act of 1974 (19 U.S.C. 
2293) is amended by adding at the end the following:
  ``(g) Notwithstanding any other provision of this section, in 
order to assist an adversely affected worker to complete 
training approved for the worker under section 236 which 
includes a program of remedial education (as described in 
section 236(a)(5)(D)), and in accordance with regulations 
prescribed by the Secretary, payments may be made as trade 
readjustment allowances for up to 26 additional weeks in the 
26-week period that follows the last week of entitlement to 
trade readjustment allowances otherwise payable under this 
chapter.''.

SEC. 117. ANNUAL TOTAL AMOUNT OF PAYMENTS FOR TRAINING.

  Section 236(a)(2)(A) of the Trade Act of 1974 (19 U.S.C. 
2296(a)(2)(A)) is amended by striking ``$80,000,000'' and all 
that follows through ``$70,000,000'' and inserting 
``$110,000,000''.

SEC. 118. AUTHORITY OF STATES WITH RESPECT TO COSTS OF APPROVED 
                    TRAINING AND SUPPLEMENTAL ASSISTANCE.

  (a) Costs of Approved Training.--Section 236(a) of the Trade 
Act of 1974 (19 U.S.C. 2296(a)) is amended by adding at the end 
the following new paragraph:
  ``(10) For purposes of carrying out paragraph (1)(F), the 
Secretary shall authorize any cooperating State or State agency 
to establish, pursuant to guidelines issued by the Secretary, a 
uniform limit on the cost of training to be paid from funds 
provided under this chapter that may be approved by such State 
for an adversely affected worker under this section.''.
  (b) Supplemental Assistance.--Section 236(b) of such Act (19 
U.S.C. 2296(b)) is amended by inserting the following sentence 
after the first sentence: ``The Secretary shall authorize any 
cooperating State or State agency to take into account the cost 
of the training approved for an adversely affected worker under 
subsection (a) in determining the appropriate amount of 
supplemental assistance to be provided to such worker under 
this subsection.''.

SEC. 119. PROVISION OF EMPLOYER-BASED TRAINING.

  (a) In General.--Section 236(a)(5)(A) of the Trade Act of 
1974 (19 U.S.C. 2296(a)(5)(A)) is amended to read as follows:
          ``(A) employer-based training, including--
                  ``(i) on-the-job training, and
                  ``(ii) customized training,''.
  (b) Reimbursement.--Section 236(c)(8) of such Act (19 U.S.C. 
2296(c)(8)) is amended to read as follows:
          ``(8) the employer is provided reimbursement of not 
        more than 50 percent of the wage rate of the 
        participant, for the cost of providing the training and 
        additional supervision related to the training,''.
  (c) Definition.--Section 236 of such Act (19 U.S.C. 2296) is 
amended by adding the following new subsection:
  ``(f) For purposes of this section, the term `customized 
training' means training that is--
          ``(1) designed to meet the special requirements of an 
        employer or group of employers;
          ``(2) conducted with a commitment by the employer or 
        group of employers to employ an individual upon 
        successful completion of the training; and
          ``(3) for which the employer pays for a significant 
        portion (but in no case less than 50 percent) of the 
        cost of such training, as determined by the 
        Secretary.''.

SEC. 120. COORDINATION WITH TITLE I OF THE WORKFORCE INVESTMENT ACT OF 
                    1998.

  (a) Coordination With One-Stop Delivery Systems in the 
Provision of Employment Services.--Section 235 of the Trade Act 
of 1974 (19 U.S.C. 2295) is amended by inserting before the 
period at the end of the first sentence the following: ``, 
including the services provided through one-stop delivery 
systems described in section 134(c) of the Workforce Investment 
Act of 1998 (29 U.S.C. 2864(c))''.
  (b) Coordination With Title I of the Workforce Investment Act 
of 1998.--
          (1) In general.--Section 239(e) of such Act (19 
        U.S.C. 2311(e)) is amended to read as follows:
  ``(e) Any agreement entered into under this section shall 
provide for the coordination of the administration of the 
provisions for employment services, training, and supplemental 
assistance under sections 235 and 236 of this chapter with 
provisions relating to dislocated worker employment and 
training activities (including supportive services) under 
chapter 5 of subtitle B of title I of the Workforce Investment 
Act of 1998 (29 U.S.C. 2861 et seq.) upon such terms and 
conditions, as established by the Secretary after consultation 
with the States, that are consistent with this section. Such 
terms and conditions shall, at a minimum, include requirements 
that--
          ``(1) adversely affected workers applying for 
        assistance under this chapter be co-enrolled in the 
        dislocated worker program authorized under chapter 5 of 
        subtitle B of title I of the Workforce Investment Act 
        of 1998;
          ``(2) training under section 236 shall be provided in 
        accordance with the provisions relating to consumer 
        choice requirements and the use of individual training 
        accounts under subparagraphs (F) and (G) of section 
        134(d)(4) of the Workforce Investment Act of 1998 (29 
        U.S.C. 2864(d)(4)(F) and (G)), including--
                  ``(A) the requirement that only providers 
                eligible under section 122 of the Workforce 
                Investment Act of 1998 (29 U.S.C. 2842) shall 
                be eligible to provide training; and
                  ``(B) that the exceptions to the use of 
                individual training accounts described in 
                section 134(d)(4)(G)(ii) of such Act (29 U.S.C. 
                2864(d)(4)(G)(ii)) shall be applicable; and
          ``(3) common reporting systems and elements, 
        including common elements relating to participant and 
        performance data, shall be used by the program 
        authorized under this chapter and the dislocated worker 
        program authorized under chapter 5 of subtitle B of 
        title I of such Act.''.
          (2) Additional requirement.--Section 239(g) of such 
        Act (19 U.S.C. 2311(g)) is amended--
                  (A) by inserting ``(1)'' after ``(g)''; and
                  (B) by adding at the end the following new 
                paragraph:
  ``(2) The agreement under this section shall also provide 
that the cooperating State agency shall be a one-stop partner 
as described in subparagraphs (A) and (B)(viii) of section 
121(b)(1) of the Workforce Investment Act of 1998 (29 U.S.C. 
2841(b)(1)(A) and (B)(viii)) in the one-stop delivery system 
established under section 134(c) of such Act (29 U.S.C. 
2864(c)) for the appropriate local workforce investment areas, 
and shall carry out the responsibilities relating to such 
partners.''.
          (3) Conforming amendments.--Section 236(a)(1) of such 
        Act (19 U.S.C. 2296(a)(1)) is amended--
                  (A) in the matter preceding subparagraph (A), 
                by inserting ``, pursuant to an interview, 
                evaluation, assessment, or case management of 
                the worker,'' after ``Secretary determines''; 
                and
                  (B) in the second sentence of such paragraph, 
                by striking ``, directly or through a voucher 
                system'' and inserting ``through individual 
                training accounts pursuant to the agreement 
                under section 239(e)(2)''.

SEC. 121. EXPENDITURE PERIOD.

  Section 245 of the Trade Act of 1974 (19 U.S.C. 2317), as 
amended by section 111(a) of this Act, is further amended--
          (1) by striking ``There are authorized'' and 
        inserting ``(a) In General.--There are authorized''; 
        and
          (2) by adding at the end the following subsection:.
  ``(b) Period of Expenditure.--Funds obligated for any fiscal 
year to carry out activities under sections 235 through 238 may 
be expended by each State receiving such funds during that 
fiscal year and the succeeding two fiscal years.''.

SEC. 122. DECLARATION OF POLICY; SENSE OF CONGRESS.

  (a) Declaration of Policy.--Congress reiterates that, under 
the trade adjustment assistance program under chapter 2 of 
title II of the Trade Act of 1974, workers are eligible for 
transportation, childcare, and healthcare assistance, as well 
as other related assistance under programs administered by the 
Department of Labor.
  (b) Sense of Congress.--It is the sense of Congress that the 
Secretary of Labor, working independently and in conjunction 
with the States, should, in accordance with section 225 of the 
Trade Act of 1974, provide more specific information about 
benefit allowances, training, and other employment services, 
and the petition and application procedures (including 
appropriate filing dates) for such allowances, training, and 
services, under the trade adjustment assistance program under 
chapter 2 of title II of the Trade Act of 1974 to workers who 
are applying for, or are certified to receive, assistance under 
that program, including information on all other Federal 
assistance available to such workers.

  TITLE II--CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS

SEC. 201. CREDIT FOR HEALTH INSURANCE COSTS OF INDIVIDUALS RECEIVING A 
                    TRADE READJUSTMENT ALLOWANCE OR A BENEFIT FROM THE 
                    PENSION BENEFIT GUARANTY CORPORATION.

  (a) In General.--Subpart C of part IV of subchapter A of 
chapter 1 of the Internal Revenue Code of 1986 (relating to 
refundable credits) is amended by redesignating section 35 as 
section 36 and inserting after section 34 the following new 
section:

``SEC. 35. HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS.

  ``(a) In General.--In the case of an individual, there shall 
be allowed as a credit against the tax imposed by subtitle A an 
amount equal to 60 percent of the amount paid by the taxpayer 
for coverage of the taxpayer and qualifying family members 
under qualified health insurance for eligible coverage months 
beginning in the taxable year.
  ``(b) Limitation Based on Modified Adjusted Gross Income.--
For purposes of this section--
          ``(1) In general.--Except as provided in paragraph 
        (2), if the modified adjusted gross income of the 
        taxpayer for the taxable year exceeds $20,000, the 
        amount which would (but for this subsection and 
        subsection (h)(1)) be allowed as a credit under 
        subsection (a) shall be reduced (but not below zero) by 
        the amount which bears the same ratio to the amount 
        which would be so allowed as such excess bears to 
        $20,000.
          ``(2) Family coverage.--
                  ``(A) Separate application of limitation.--
                Paragraph (1) shall be applied separately with 
                respect to--
                          ``(i) amounts paid for eligible 
                        coverage months as of the first day of 
                        which one or more qualifying family 
                        members are covered by the qualified 
                        health insurance covering the taxpayer, 
                        and
                          ``(ii) amounts paid for other 
                        eligible coverage months.
                  ``(B) Limitation amount.--With respect to 
                amounts described in subparagraph (A)(i), 
                paragraph (1) shall be applied by substituting 
                `$40,000' for `$20,000' each place it appears.
          ``(3) Modified adjusted gross income.--The term 
        `modified adjusted gross income' means adjusted gross 
        income determined without regard to sections 911, 931, 
        and 933.
  ``(c) Eligible Coverage Month.--For purposes of this 
section--
          ``(1) In general.--The term `eligible coverage month' 
        means any month if--
                  ``(A) as of the first day of such month, the 
                taxpayer--
                          ``(i) is an eligible individual,
                          ``(ii) is covered by qualified health 
                        insurance, the premium for which is 
                        paid by the taxpayer, and
                          ``(iii) does not have other specified 
                        coverage,
                  ``(B) such month begins more than 90 days 
                after the date of the enactment of the Trade 
                Act of 2002, and
                  ``(C) in the case of any eligible TAA 
                recipient, such month is designated under 
                paragraph (2).
          ``(2) Designation of eligible coverage months.--Any 
        eligible TAA recipient may designate, with respect to 
        any period of 36 months, not more than 12 months of 
        such period as eligible coverage months.
          ``(3) Joint returns.--In the case of a joint return, 
        the requirements of paragraph (1)(A) shall be treated 
        as met with respect to any month if at least 1 spouse 
        satisfies such requirements.
  ``(d) Eligible Individual.--For purposes of this section--
          ``(1) In general.--The term `eligible individual' 
        means--
                  ``(A) an eligible TAA recipient, or
                  ``(B) an eligible PBGC pension recipient.
          ``(2) Eligible taa recipient.--The term `eligible TAA 
        recipient' means, with respect to any month, any 
        individual--
                  ``(A) who is receiving for any day of such 
                month a trade readjustment allowance under part 
                I of subchapter B, or subchapter D, of chapter 
                2 of title II of the Trade Act of 1974 (19 
                U.S.C. 2291 et seq. or 2331 et seq.) or who 
                would be eligible to receive such allowance if 
                section 231 of such Act (19 U.S.C. 2291) were 
                applied without regard to subsection (a)(3)(B) 
                of such section, and
                  ``(B) who, with respect to such allowance, is 
                covered under a certification issued--
                          ``(i) under subchapter A or D of 
                        chapter 2 of title II of the Trade Act 
                        of 1974 (19 U.S.C. 2271 et seq. or 2331 
                        et seq.), and
                          ``(ii) after the date which is 90 
                        days after the date of the enactment of 
                        the Trade Act of 2002.
        An individual shall continue to be treated as an 
        eligible TAA recipient during the first month that such 
        individual would otherwise cease to be an eligible TAA 
        recipient.
          ``(3) Eligible pbgc pension recipient.--The term 
        `eligible PBGC pension recipient' means, with respect 
        to any month, any individual who--
                  ``(A) has attained age 55 as of the first day 
                of such month, and
                  ``(B) is receiving a benefit for such month 
                any portion of which is paid by the Pension 
                Benefit Guaranty Corporation under title IV of 
                the Employee Retirement Income Security Act of 
                1974.
  ``(e) Qualifying Family Member.--For purposes of this 
section--
          ``(1) In general.--The term `qualifying family 
        member' means--
                  ``(A) the taxpayer's spouse, and
                  ``(B) any dependent of the taxpayer with 
                respect to whom the taxpayer is entitled to a 
                deduction under section 151(c).
        Such term does not include any individual who has other 
        specified coverage.
          ``(2) Special dependency test in case of divorced 
        parents, etc.--If paragraph (2) or (4) of section 
        152(e) applies to any child with respect to any 
        calendar year, in the case of any taxable year 
        beginning in such calendar year, such child shall be 
        treated as described in paragraph (1)(B) with respect 
        to the custodial parent (within the meaning of section 
        152(e)(1)) and not with respect to the noncustodial 
        parent.
  ``(f) Qualified Health Insurance.--For purposes of this 
section, the term `qualified health insurance' means insurance 
which constitutes medical care; except that such term shall not 
include any insurance if substantially all of its coverage is 
of excepted benefits described in section 9832(c).
  ``(g) Other Specified Coverage.--
          ``(1) In general.--For purposes of this section, an 
        individual has other specified coverage for any month 
        if, as of the first day of such month--
                  ``(A) Subsidized coverage.--Such individual 
                is covered under any qualified health insurance 
                under any health plan maintained by any 
                employer (or former employer) of the taxpayer 
                or the taxpayer's spouse and at least 50 
                percent of the cost of such coverage 
                (determined under section 4980B) is paid or 
                incurred by the employer.
                  ``(B) Coverage under medicare, medicaid, or 
                schip.--Such individual--
                          ``(i) is entitled to benefits under 
                        part A of title XVIII of the Social 
                        Security Act or is enrolled under part 
                        B of such title, or
                          ``(ii) is enrolled in the program 
                        under title XIX or XXI of such Act.
                  ``(C) Certain other coverage.--Such 
                individual--
                          ``(i) is enrolled in a health 
                        benefits plan under chapter 89 of title 
                        5, United States Code, or
                          ``(ii) is entitled to receive 
                        benefits under chapter 55 of title 10, 
                        United States Code.
          ``(2) Special rules related to subsidized coverage.--
                  ``(A) Employer contributions to cafeteria 
                plans, flexible spending arrangements, and 
                medical savings accounts.--Employer 
                contributions to a cafeteria plan (as defined 
                in section 125(d)), a flexible spending or 
                similar arrangement, or a medical savings 
                account which are excluded from gross income 
                under section 106 shall be treated for purposes 
                of paragraph (1)(A) as paid by the employer.
                  ``(B) Aggregation of plans of employer.--A 
                health plan which is not otherwise described in 
                paragraph (1)(A) shall be treated as described 
                in such paragraph if such plan would be so 
                described if all health plans of persons 
                treated as a single employer under subsection 
                (b), (c), (m), or (o) of section 414 were 
                treated as one health plan.
          ``(3) Immunizations not treated as medicaid 
        coverage.--For purposes of paragraph (1)(B), an 
        individual shall not be treated as enrolled in the 
        program under title XIX of the Social Security Act 
        solely on the basis of receiving a benefit under 
        section 1928 of such Act.
  ``(h) Special Rules.--
          ``(1) Coordination with advance payments of credit.--
        With respect to any taxable year, the amount which 
        would (but for this subsection) be allowed as a credit 
        to the taxpayer under subsection (a) shall be reduced 
        (but not below zero) by the aggregate amount paid on 
        behalf of such taxpayer under section 7527 for months 
        beginning in such taxable year.
          ``(2) Coordination with other deductions.--Amounts 
        taken into account under subsection (a) shall not be 
        taken into account in determining any deduction allowed 
        under section 162(l) or 213.
          ``(3) MSA distributions.--Amounts distributed from an 
        Archer MSA (as defined in section 220(d)) shall not be 
        taken into account under subsection (a).
          ``(4) Denial of credit to dependents.--No credit 
        shall be allowed under this section to any individual 
        with respect to whom a deduction under section 151 is 
        allowable to another taxpayer for a taxable year 
        beginning in the calendar year in which such 
        individual's taxable year begins.
          ``(5) Married couples must file joint return.--If the 
        taxpayer is married at the close of the taxable year, 
        the credit shall be allowed under subsection (a) only 
        if the taxpayer and his spouse file a joint return for 
        the taxable year.
          ``(6) Marital status; certain married individuals 
        living apart.--Rules similar to the rules of paragraphs 
        (3) and (4) of section 21(e) shall apply for purposes 
        of this section.
          ``(7) Insurance which covers other individuals.--For 
        purposes of this section, rules similar to the rules of 
        section 213(d)(6) shall apply with respect to any 
        contract for qualified health insurance under which 
        amounts are payable for coverage of an individual other 
        than the taxpayer and qualifying family members.
          ``(8) Treatment of payments.--For purposes of this 
        section--
                  ``(A) Payments by secretary.--Payments made 
                by the Secretary on behalf of any individual 
                under section 7527 (relating to advance payment 
                of credit for health insurance costs of 
                eligible TAA recipients) shall be treated as 
                having been made by the taxpayer on the first 
                day of the month for which such payment was 
                made.
                  ``(B) Payments by taxpayer.--Payments made by 
                the taxpayer for eligible coverage months shall 
                be treated as having been made by the taxpayer 
                on the first day of the month for which such 
                payment was made.
          ``(9) Regulations.--The Secretary may prescribe such 
        regulations and other guidance as may be necessary or 
        appropriate to carry out this section, section 6050T, 
        and section 7527.''.
  (b) Increased Access to Health Insurance for Individuals 
Eligible for Tax Credit Through Use of Guaranteed Issue, 
Qualified High Risk Pools, and Other Appropriate State 
Mechanisms.--
          (1) In general.--Notwithstanding any other provision 
        of law, in applying section 2741 of the Public Health 
        Service Act (42 U.S.C. 300gg-41)) and any alternative 
        State mechanism under section 2744 of such Act (42 
        U.S.C.300gg-44)), in determining who is an eligible 
        individual (as defined in section 2741(b) of such Act) 
        in the case of an individual who may be covered by 
        insurance for which credit is allowable under section 
        35 of the Internal Revenue Code of 1986 for an eligible 
        coverage month, if the individual seeks to obtain 
        health insurance coverage under such section during an 
        eligible coverage month under such section--
                  (A) paragraph (1) of such section 2741(b) 
                shall be applied as if any reference to 18 
                months is deemed a reference to 12 months, and
                  (B) paragraphs (4) and (5) of such section 
                2741(b) shall not apply.
          (2) Promotion of state high risk pools.--Title XXVII 
        of the Public Health Service Act is amended by 
        inserting after section 2744 the following new section:

``SEC. 2745. PROMOTION OF QUALIFIED HIGH RISK POOLS.

  ``(a) Seed Grants to States.--The Secretary shall provide 
from the funds appropriated under subsection (c)(1) a grant of 
up to $1,000,000 to each State that has not created a qualified 
high risk pool as of the date of the enactment of this section 
for the State's costs of creation and initial operation of such 
a pool.
  ``(b) Matching Funds for Operation of Pools.--
          ``(1) In general.--In the case of a State that has 
        established a qualified high risk pool that--
                  ``(A) restricts premiums charged under the 
                pool to no more than 150 percent of the premium 
                for applicable standard risk rates;
                  ``(B) that offers a choice of two or more 
                coverage options through the pool; and
                  ``(C) has in effect a mechanism reasonably 
                designed to ensure continued funding of losses 
                incurred by the State after the end of fiscal 
                year 2004 in connection with operation of the 
                pool;
        the Secretary shall provide, from the funds 
        appropriated under subsection (c)(2) and allotted to 
        the State under paragraph (2), a grant of up to 50 
        percent of the losses incurred by the State in 
        connection with the operation of the pool.
          ``(2) Allotment.--The amounts appropriated under 
        subsection (c)(2) for a fiscal year shall be made 
        available to the States in accordance with a formula 
        that is based upon the number of uninsured individuals 
        in the States.
          ``(3) Construction.--Nothing in this subsection shall 
        be construed as preventing a State from supplementing 
        the funds made available under this subsection for the 
        support and operation of qualified high risk pools.
  ``(c) Funding.--Out of any money in the Treasury of the 
United States not otherwise appropriated, there are 
appropriated--
          ``(1) $20,000,000 for fiscal year 2003 to carry out 
        subsection (a); and
          ``(2) $40,000,000 for each of fiscal years 2003 and 
        2004.
Funds appropriated under this subsection for a fiscal year 
shall remain available for obligation through the end of the 
following fiscal year. Nothing in this section shall be 
construed as providing a State with an entitlement to a grant 
under this section.
  ``(d) Qualified High Risk Pool and State Defined.--For 
purposes of this section, the term `qualified high risk pool' 
has the meaning given such term in section 2744(c)(2) and the 
term `State' means any of the 50 States and the District of 
Columbia.''.
          (3) Construction.--Nothing in this subsection shall 
        be construed as affecting the ability of a State to use 
        mechanisms, described in sections 2741(c) and 2744 of 
        the Public Health Service Act, as an alternative to 
        applying the guaranteed availability provisions of 
        section 2741(a) of such Act.
  (c) Conforming Amendments.--
          (1) Paragraph (2) of section 1324(b) of title 31, 
        United States Code, is amended by inserting before the 
        period ``, or from section 35 of such Code''.
          (2) The table of sections for subpart C of part IV of 
        chapter 1 of the Internal Revenue Code of 1986 is 
        amended by striking the last item and inserting the 
        following new items:

        ``Sec. 35. Health insurance costs of eligible individuals.
        ``Sec. 36. Overpayments of tax.''.
  (d) Effective Date.--The amendments made by this section 
shall apply to taxable years beginning after December 31, 2001.

SEC. 202. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF 
                    ELIGIBLE INDIVIDUALS.

  (a) In General.--Chapter 77 of the Internal Revenue Code of 
1986 (relating to miscellaneous provisions) is amended by 
adding at the end the following new section:

``SEC. 7527. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF 
                    ELIGIBLE INDIVIDUALS.

  ``(a) General Rule.--Not later than July 1, 2003, the 
Secretary shall establish a program for making payments on 
behalf of certified individuals to providers of qualified 
health insurance (as defined in section 35(f)) for such 
individuals.
  ``(b) Limitation on Advance Payments During any Taxable 
Year.--
          ``(1) In general.--The Secretary may make payments 
        under subsection (a) only to the extent that the total 
        amount of such payments made on behalf of any 
        individual during the taxable year does not exceed such 
        individual's advance payment limitation amount for such 
        year.
          ``(2) Advance payment limitation amount.--
                  ``(A) In general.--Except as provided in 
                subparagraph (B), with respect to any certified 
                individual, the advance payment limitation 
                amount for any taxable year shall be an amount 
                equal to the amount that such individual would 
                be allowed as a credit under section 35 for 
                such taxable year if such individual's modified 
                adjusted gross income (as defined in section 
                35(b)(3)) for such taxable year were an amount 
                equal to the amount of such individual's 
                modified adjusted gross income shown on the 
                return for the prior taxable year.
                  ``(B) Substitute amount.--For purposes of 
                this section, the Secretary may substitute an 
                amount for an individual's advance payment 
                limitation amount for any taxable year if the 
                Secretary determines that such substitute 
                amount more accurately reflects such 
                individual's modified adjusted gross income for 
                such taxable year.
  ``(c) Certified Individual.--For purposes of this section, 
the term `certified individual' means any individual for whom a 
qualified health insurance costs credit eligibility certificate 
is in effect.
  ``(d) Qualified Health Insurance Costs Credit Eligibility 
Certificate.--For purposes of this section, a qualified health 
insurance costs credit eligibility certificate is a statement 
certified by the Secretary of Labor or the Pension Benefit 
Guaranty Corporation (or by any other person or entity 
designated by the Secretary) which--
          ``(1) certifies that the individual was an eligible 
        individual (within the meaning of section 35(d)) as of 
        the first day of any month, and
          ``(2) provides such other information as the 
        Secretary may require for purposes of this section.''.
  (b) Disclosure of Return Information for Purposes of Carrying 
out a Program for Advance Payment of Credit for Health 
Insurance Costs of Eligible Individuals.--
          (1) In general.--Subsection (l) of section 6103 of 
        such Code (relating to disclosure of returns and return 
        information for purposes other than tax administration) 
        is amended by adding at the end the following new 
        paragraph:
          ``(18) Disclosure of return information for purposes 
        of carrying out a program for advance payment of credit 
        for health insurance costs of eligible individuals.--
        The Secretary may disclose to providers of health 
        insurance for any certified individual (as defined in 
        section 7527(c)) return information with respect to 
        such certified individual only to the extent necessary 
        to carry out the program established by section 7527 
        (relating to advance payment of health insurance cost 
        credit).''.
          (2) Procedures and recordkeeping related to 
        disclosures.--Subsection (p) of such section is 
        amended--
                  (A) in paragraph (3)(A) by striking ``or 
                (17)'' and inserting ``(17), or (18)'', and
                  (B) in paragraph (4) by inserting ``or (17)'' 
                after ``any other person described in 
                subsection (l)(16)'' each place it appears.
          (3) Unauthorized inspection of returns or return 
        information.--Section 7213A(a)(1)(B) of such Code is 
        amended by striking ``section 6103(n)'' and inserting 
        ``subsection (l)(18) or (n) of section 6103''.
  (c) Information Reporting.--
          (1) In general.--Subpart B of part III of subchapter 
        A of chapter 61 of the Internal Revenue Code of 1986 
        (relating to information concerning transactions with 
        other persons) is amended by inserting after section 
        6050S the following new section:

``SEC. 6050T. RETURNS RELATING TO CREDIT FOR HEALTH INSURANCE COSTS OF 
                    ELIGIBLE INDIVIDUALS.

  ``(a) Requirement of Reporting.--Every person who is entitled 
to receive payments for any month of any calendar year under 
section 7527 (relating to advance payment of credit for health 
insurance costs of eligible individuals) with respect to any 
certified individual (as defined in section 7527(c)) shall, at 
such time as the Secretary may prescribe, make the return 
described in subsection (b) with respect to each such 
individual.
  ``(b) Form and Manner of Returns.--A return is described in 
this subsection if such return--
          ``(1) is in such form as the Secretary may prescribe, 
        and
          ``(2) contains--
                  ``(A) the name, address, and TIN of each 
                individual referred to in subsection (a),
                  ``(B) the number of months for which amounts 
                were entitled to be received with respect to 
                such individual under section 7527 (relating to 
                advance payment of credit for health insurance 
                costs of eligible individuals),
                  ``(C) the amount entitled to be received for 
                each such month, and
                  ``(D) such other information as the Secretary 
                may prescribe.
  ``(c) Statements To Be Furnished to Individuals With Respect 
to Whom Information Is Required.--Every person required to make 
a return under subsection (a) shall furnish to each individual 
whose name is required to be set forth in such return a written 
statement showing--
          ``(1) the name and address of the person required to 
        make such return and the phone number of the 
        information contact for such person, and
          ``(2) the information required to be shown on the 
        return with respect to such individual.
The written statement required under the preceding sentence 
shall be furnished on or before January 31 of the year 
following the calendar year for which the return under 
subsection (a) is required to be made.''.
          (2) Assessable penalties.--
                  (A) Subparagraph (B) of section 6724(d)(1) of 
                such Code (relating to definitions) is amended 
                by redesignating clauses (xi) through (xvii) as 
                clauses (xii) through (xviii), respectively, 
                and by inserting after clause (x) the following 
                new clause:
                          ``(xi) section 6050T (relating to 
                        returns relating to credit for health 
                        insurance costs of eligible 
                        individuals),''.
                  (B) Paragraph (2) of section 6724(d) of such 
                Code is amended by striking ``or'' at the end 
                of subparagraph (Z), by striking the period at 
                the end of subparagraph (AA) and inserting ``, 
                or'', and by adding after subparagraph (AA) the 
                following new subparagraph:
                  ``(BB) section 6050T (relating to returns 
                relating to credit for health insurance costs 
                of eligible individuals).''.
  (d) Clerical Amendments.--
          (1) Advance payment.--The table of sections for 
        chapter 77 of such Code is amended by adding at the end 
        the following new item:

        ``Sec. 7527. Advance payment of credit for health insurance 
                  costs of eligible individuals.''.
          (2) Information reporting.--The table of sections for 
        subpart B of part III of subchapter A of chapter 61 of 
        such Code is amended by inserting after the item 
        relating to section 6050S the following new item:

        ``Sec. 6050T. Returns relating to credit for health insurance 
                  costs of eligible individuals.''.
  (e) Effective Date.--The amendments made by this section 
shall take effect on the date of the enactment of this Act.

                   TITLE III--CUSTOMS REAUTHORIZATION

SEC. 301. SHORT TITLE.

  This Act may be cited as the ``Customs Border Security Act of 
2002''.

               Subtitle A--United States Customs Service

  CHAPTER 1--DRUG ENFORCEMENT AND OTHER NONCOMMERCIAL AND COMMERCIAL 
                               OPERATIONS


SEC. 311. AUTHORIZATION OF APPROPRIATIONS FOR NONCOMMERCIAL OPERATIONS, 
                    COMMERCIAL OPERATIONS, AND AIR AND MARINE 
                    INTERDICTION.

  (a) Noncommercial Operations.--Section 301(b)(1) of the 
Customs Procedural Reform and Simplification Act of 1978 (19 
U.S.C. 2075(b)(1)) is amended--
          (1) in subparagraph (A) to read as follows:
                  ``(A) $899,121,000 for fiscal year 2002.'';
          (2) in subparagraph (B) to read as follows:
                  ``(B) $1,365,456,000 for fiscal year 2003.''; 
                and
          (3) by adding at the end the following:
                  ``(C) $1,399,592,400 for fiscal year 2004.''.
  (b) Commercial Operations.--
          (1) In general.--Section 301(b)(2)(A) of the Customs 
        Procedural Reform and Simplification Act of 1978 (19 
        U.S.C. 2075(b)(2)(A)) is amended--
                  (A) in clause (i) to read as follows:
                  ``(i) $1,606,068,000 for fiscal year 2002.'';
                  (B) in clause (ii) to read as follows:
                  ``(ii) $1,642,602,000 for fiscal year 
                2003.''; and
                  (C) by adding at the end the following:
                  ``(iii) $1,683,667,050 for fiscal year 
                2004.''.
          (2) Automated commercial environment computer 
        system.--Of the amount made available for each of 
        fiscal years 2002 through 2004 under section 
        301(b)(2)(A) of the Customs Procedural Reform and 
        Simplification Act of 1978 (19 U.S.C. 2075(b)(2)(A)), 
        as amended by paragraph (1), $308,000,000 shall be 
        available until expended for each such fiscal year for 
        the development, establishment, and implementation of 
        the Automated Commercial Environment computer system.
          (3) Reports.--Not later than 90 days after the date 
        of the enactment of this Act, and not later than each 
        subsequent 90-day period, the Commissioner of Customs 
        shall prepare and submit to the Committee on Ways and 
        Means of the House of Representatives and the Committee 
        on Finance of the Senate a report demonstrating that 
        the development and establishment of the Automated 
        Commercial Environment computer system is being carried 
        out in a cost-effective manner and meets the 
        modernization requirements of title VI of the North 
        American Free Trade Agreement Implementation Act.
  (c) Air and Marine Interdiction.--Section 301(b)(3) of the 
Customs Procedural Reform and Simplification Act of 1978 (19 
U.S.C. 2075(b)(3)) is amended--
          (1) in subparagraph (A) to read as follows:
                  ``(A) $177,860,000 for fiscal year 2002.'';
          (2) in subparagraph (B) to read as follows:
                  ``(B) $170,829,000 for fiscal year 2003.''; 
                and
          (3) by adding at the end the following:
                  ``(C) $175,099,725 for fiscal year 2004.''.
  (d) Submission of Out-Year Budget Projections.--Section 
301(a) of the Customs Procedural Reform and Simplification Act 
of 1978 (19 U.S.C. 2075(a)) is amended by adding at the end the 
following:
  ``(3) By not later than the date on which the President 
submits to Congress the budget of the United States Government 
for a fiscal year, the Commissioner of Customs shall submit to 
the Committee on Ways and Means of the House of Representatives 
and the Committee on Finance of the Senate the projected amount 
of funds for the succeeding fiscal year that will be necessary 
for the operations of the Customs Service as provided for in 
subsection (b).''.

SEC. 312. ANTITERRORIST AND ILLICIT NARCOTICS DETECTION EQUIPMENT FOR 
                    THE UNITED STATES-MEXICO BORDER, UNITED STATES-
                    CANADA BORDER, AND FLORIDA AND THE GULF COAST 
                    SEAPORTS.

  (a) Fiscal Year 2002.--Of the amounts made available for 
fiscal year 2002 under section 301(b)(1)(A) of the Customs 
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 
2075(b)(1)(A)), as amended by section 311(a) of this Act, 
$90,244,000 shall be available until expended for acquisition 
and other expenses associated with implementation and 
deployment of antiterrorist and illicit narcotics detection 
equipment along the United States-Mexico border, the United 
States-Canada border, and Florida and the Gulf Coast seaports, 
as follows:
          (1) United states-mexico border.--For the United 
        States-Mexico border, the following:
                  (A) $6,000,000 for 8 Vehicle and Container 
                Inspection Systems (VACIS).
                  (B) $11,200,000 for 5 mobile truck x-rays 
                with transmission and backscatter imaging.
                  (C) $13,000,000 for the upgrade of 8 fixed-
                site truck x-rays from the present energy level 
                of 450,000 electron volts to 1,000,000 electron 
                volts (1-MeV).
                  (D) $7,200,000 for 8 1-MeV pallet x-rays.
                  (E) $1,000,000 for 200 portable contraband 
                detectors (busters) to be distributed among 
                ports where the current allocations are 
                inadequate.
                  (F) $600,000 for 50 contraband detection kits 
                to be distributed among all southwest border 
                ports based on traffic volume.
                  (G) $500,000 for 25 ultrasonic container 
                inspection units to be distributed among all 
                ports receiving liquid-filled cargo and to 
                ports with a hazardous material inspection 
                facility.
                  (H) $2,450,000 for 7 automated targeting 
                systems.
                  (I) $360,000 for 30 rapid tire deflator 
                systems to be distributed to those ports where 
                port runners are a threat.
                  (J) $480,000 for 20 portable Treasury 
                Enforcement Communications Systems (TECS) 
                terminals to be moved among ports as needed.
                  (K) $1,000,000 for 20 remote watch 
                surveillance camera systems at ports where 
                there are suspicious activities at loading 
                docks, vehicle queues, secondary inspection 
                lanes, or areas where visual surveillance or 
                observation is obscured.
                  (L) $1,254,000 for 57 weigh-in-motion sensors 
                to be distributed among the ports with the 
                greatest volume of outbound traffic.
                  (M) $180,000 for 36 AM traffic information 
                radio stations, with 1 station to be located at 
                each border crossing.
                  (N) $1,040,000 for 260 inbound vehicle 
                counters to be installed at every inbound 
                vehicle lane.
                  (O) $950,000 for 38 spotter camera systems to 
                counter the surveillance of customs inspection 
                activities by persons outside the boundaries of 
                ports where such surveillance activities are 
                occurring.
                  (P) $390,000 for 60 inbound commercial truck 
                transponders to be distributed to all ports of 
                entry.
                  (Q) $1,600,000 for 40 narcotics vapor and 
                particle detectors to be distributed to each 
                border crossing.
                  (R) $400,000 for license plate reader 
                automatic targeting software to be installed at 
                each port to target inbound vehicles.
          (2) United states-canada border.--For the United 
        States-Canada border, the following:
                  (A) $3,000,000 for 4 Vehicle and Container 
                Inspection Systems (VACIS).
                  (B) $8,800,000 for 4 mobile truck x-rays with 
                transmission and backscatter imaging.
                  (C) $3,600,000 for 4 1-MeV pallet x-rays.
                  (D) $250,000 for 50 portable contraband 
                detectors (busters) to be distributed among 
                ports where the current allocations are 
                inadequate.
                  (E) $300,000 for 25 contraband detection kits 
                to be distributed among ports based on traffic 
                volume.
                  (F) $240,000 for 10 portable Treasury 
                Enforcement Communications Systems (TECS) 
                terminals to be moved among ports as needed.
                  (G) $400,000 for 10 narcotics vapor and 
                particle detectors to be distributed to each 
                border crossing based on traffic volume.
          (3) Florida and gulf coast seaports.--For Florida and 
        the Gulf Coast seaports, the following:
                  (A) $4,500,000 for 6 Vehicle and Container 
                Inspection Systems (VACIS).
                  (B) $11,800,000 for 5 mobile truck x-rays 
                with transmission and backscatter imaging.
                  (C) $7,200,000 for 8 1-MeV pallet x-rays.
                  (D) $250,000 for 50 portable contraband 
                detectors (busters) to be distributed among 
                ports where the current allocations are 
                inadequate.
                  (E) $300,000 for 25 contraband detection kits 
                to be distributed among ports based on traffic 
                volume.
  (b) Fiscal Year 2003.--Of the amounts made available for 
fiscal year 2003 under section 301(b)(1)(B) of the Customs 
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 
2075(b)(1)(B)), as amended by section 311(a) of this Act, 
$9,000,000 shall be available until expended for the 
maintenance and support of the equipment and training of 
personnel to maintain and support the equipment described in 
subsection (a).
  (c) Acquisition of Technologically Superior Equipment; 
Transfer of Funds.--
          (1) In general.--The Commissioner of Customs may use 
        amounts made available for fiscal year 2002 under 
        section 301(b)(1)(A) of the Customs Procedural Reform 
        and Simplification Act of 1978 (19 U.S.C. 
        2075(b)(1)(A)), as amended by section 311(a) of this 
        Act, for the acquisition of equipment other than the 
        equipment described in subsection (a) if such other 
        equipment--
                  (A)(i) is technologically superior to the 
                equipment described in subsection (a); and
                  (ii) will achieve at least the same results 
                at a cost that is the same or less than the 
                equipment described in subsection (a); or
                  (B) can be obtained at a lower cost than the 
                equipment described in subsection (a).
          (2) Transfer of funds.--Notwithstanding any other 
        provision of this section, the Commissioner of Customs 
        may reallocate an amount not to exceed 10 percent of--
                  (A) the amount specified in any of 
                subparagraphs (A) through (R) of subsection 
                (a)(1) for equipment specified in any other of 
                such subparagraphs (A) through (R);
                  (B) the amount specified in any of 
                subparagraphs (A) through (G) of subsection 
                (a)(2) for equipment specified in any other of 
                such subparagraphs (A) through (G); and
                  (C) the amount specified in any of 
                subparagraphs (A) through (E) of subsection 
                (a)(3) for equipment specified in any other of 
                such subparagraphs (A) through (E).

SEC. 313. COMPLIANCE WITH PERFORMANCE PLAN REQUIREMENTS.

  As part of the annual performance plan for each of the fiscal 
years 2002 and 2003 covering each program activity set forth in 
the budget of the United States Customs Service, as required 
under section 1115 of title 31, United States Code, the 
Commissioner of Customs shall establish performance goals, 
performance indicators, and comply with all other requirements 
contained in paragraphs (1) through (6) of subsection (a) of 
such section with respect to each of the activities to be 
carried out pursuant to section 312.

     CHAPTER 2--CHILD CYBER-SMUGGLING CENTER OF THE CUSTOMS SERVICE


SEC. 321. AUTHORIZATION OF APPROPRIATIONS FOR PROGRAM TO PREVENT CHILD 
                    PORNOGRAPHY/CHILD SEXUAL EXPLOITATION.

  (a) Authorization of Appropriations.--There is authorized to 
be appropriated to the Customs Service $10,000,000 for fiscal 
year 2002 to carry out the program to prevent child 
pornography/child sexual exploitation established by the Child 
Cyber-Smuggling Center of the Customs Service.
  (b) Use of Amounts for Child Pornography Cyber Tipline.--Of 
the amount appropriated under subsection (a), the Customs 
Service shall provide 3.75 percent of such amount to the 
National Center for Missing and Exploited Children for the 
operation of the child pornography cyber tipline of the Center 
and for increased public awareness of the tipline.

                  CHAPTER 3--MISCELLANEOUS PROVISIONS


SEC. 331. ADDITIONAL CUSTOMS SERVICE OFFICERS FOR UNITED STATES-CANADA 
                    BORDER.

  Of the amount made available for fiscal year 2002 under 
paragraphs (1) and (2)(A) of section 301(b) of the Customs 
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 
2075(b)), as amended by section 311 of this Act, $28,300,000 
shall be available until expended for the Customs Service to 
hire approximately 285 additional Customs Service officers to 
address the needs of the offices and ports along the United 
States-Canada border.

SEC. 332. STUDY AND REPORT RELATING TO PERSONNEL PRACTICES OF THE 
                    CUSTOMS SERVICE.

  (a) Study.--The Commissioner of Customs shall conduct a study 
of current personnel practices of the Customs Service, 
including an overview of performance standards and the effect 
and impact of the collective bargaining process on drug 
interdiction efforts of the Customs Service and a comparison of 
duty rotation policies of the Customs Service and other Federal 
agencies that employ similarly-situated personnel.
  (b) Report.--Not later than 120 days after the date of the 
enactment of this Act, the Commissioner of Customs shall submit 
to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate a 
report containing the results of the study conducted under 
subsection (a).

SEC. 333. STUDY AND REPORT RELATING TO ACCOUNTING AND AUDITING 
                    PROCEDURES OF THE CUSTOMS SERVICE.

  (a) Study.--(1) The Commissioner of Customs shall conduct a 
study of actions by the Customs Service to ensure that 
appropriate training is being provided to Customs Service 
personnel who are responsible for financial auditing of 
importers.
  (2) In conducting the study, the Commissioner--
          (A) shall specifically identify those actions taken 
        to comply with provisions of law that protect the 
        privacy and trade secrets of importers, such as section 
        552(b) of title 5, United States Code, and section 1905 
        of title 18, United States Code; and
          (B) shall provide for public notice and comment 
        relating to verification of the actions described in 
        subparagraph (A).
  (b) Report.--Not later than 6 months after the date of the 
enactment of this Act, the Commissioner of Customs shall submit 
to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate a 
report containing the results of the study conducted under 
subsection (a).

SEC. 334. ESTABLISHMENT AND IMPLEMENTATION OF COST ACCOUNTING SYSTEM; 
                    REPORTS.

  (a) Establishment and Implementation.--
          (1) In general.--Not later than September 30, 2003, 
        the Commissioner of Customs shall, in accordance with 
        the audit of the Customs Service's fiscal years 2000 
        and 1999 financial statements (as contained in the 
        report of the Office of the Inspector General of the 
        Department of the Treasury issued on February 23, 
        2001), establish and implement a cost accounting system 
        for expenses incurred in both commercial and 
        noncommercial operations of the Customs Service.
          (2) Additional requirement.--The cost accounting 
        system described in paragraph (1) shall provide for an 
        identification of expenses based on the type of 
        operation, the port at which the operation took place, 
        the amount of time spent on the operation by personnel 
        of the Customs Service, and an identification of 
        expenses based on any other appropriate classification 
        necessary to provide for an accurate and complete 
        accounting of the expenses.
  (b) Reports.--Beginning on the date of the enactment of this 
Act and ending on the date on which the cost accounting system 
described in subsection (a) is fully implemented, the 
Commissioner of Customs shall prepare and submit to Congress on 
a quarterly basis a report on the progress of implementing the 
cost accounting system pursuant to subsection (a).

SEC. 335. STUDY AND REPORT RELATING TO TIMELINESS OF PROSPECTIVE 
                    RULINGS.

  (a) Study.--The Comptroller General shall conduct a study on 
the extent to which the Office of Regulations and Rulings of 
the Customs Service has made improvements to decrease the 
amount of time to issue prospective rulings from the date on 
which a request for the ruling is received by the Customs 
Service.
  (b) Report.--Not later than 1 year after the date of the 
enactment of this Act, the Comptroller General shall submit to 
the Committee on Ways and Means of the House of Representatives 
and the Committee on Finance of the Senate a report containing 
the results of the study conducted under subsection (a).
  (c) Definition.--In this section, the term ``prospective 
ruling'' means a ruling that is requested by an importer on 
goods that are proposed to be imported into the United States 
and that relates to the proper classification, valuation, or 
marking of such goods.

SEC. 336. STUDY AND REPORT RELATING TO CUSTOMS USER FEES.

  (a) Study.--The Comptroller General shall conduct a study on 
the extent to which the amount of each customs user fee imposed 
under section 13031(a) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (19 U.S.C. 58c(a)) is commensurate 
with the level of services provided by the Customs Service 
relating to the fee so imposed.
  (b) Report.--Not later than 120 days after the date of the 
enactment of this Act, the Comptroller General shall submit to 
the Committee on Ways and Means of the House of Representatives 
and the Committee on Finance of the Senate a report in 
classified form containing--
          (1) the results of the study conducted under 
        subsection (a); and
          (2) recommendations for the appropriate amount of the 
        customs user fees if such results indicate that the 
        fees are not commensurate with the level of services 
        provided by the Customs Service.

SEC. 337. FEES FOR CUSTOMS INSPECTIONS AT EXPRESS COURIER FACILITIES.

  (a) In General.--Section 13031(b)(9) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(9)) 
is amended as follows:
          (1) In subparagraph (A)--
                  (A) in the matter preceding clause (i), by 
                striking ``the processing of merchandise that 
                is informally entered or released'' and 
                inserting ``the processing of letters, 
                documents, records, shipments, merchandise, or 
                any other item that is valued at an amount 
                under $2,000 (or such higher amount as the 
                Secretary may set by regulation pursuant to 
                section 498 of the Tariff Act of 1930), whether 
                or not such items are informally entered or 
                released (except items entered or released for 
                immediate exportation),''; and
                  (B) in clause (ii) to read as follows:
                  ``(ii) In the case of an express consignment 
                carrier facility or centralized hub facility, 
                $.66 per individual airway bill or bill of 
                lading.''.
          (2) By redesignating subparagraph (B) as subparagraph 
        (C) and inserting after subparagraph (A) the following:
          ``(B)(i) For fiscal year 2004 and subsequent fiscal 
        years, the Secretary of the Treasury may adjust (not 
        more than once per fiscal year) the amount described in 
        subparagraph (A)(ii) to not less than $.35 but not more 
        than $1.00 per individual airway bill or bill of 
        lading. The Secretary shall provide notice in the 
        Federal Register of a proposed adjustment under the 
        preceding sentence and the reasons therefor and shall 
        allow for public comment on the proposed adjustment.
          ``(ii) The payment required by subparagraph (A)(ii) 
        shall be the only payment required for reimbursement of 
        the Customs Service in connection with the processing 
        of an individual airway bill or bill of lading in 
        accordance with such subparagraph, except that the 
        Customs Service may charge a fee to cover expenses of 
        the Customs Service for adequate office space, 
        equipment, furnishings, supplies, and security.
          ``(iii)(I) The payment required by subparagraph 
        (A)(ii) and clause (ii) shall be paid on a quarterly 
        basis to the Customs Service in accordance with 
        regulations prescribed by the Secretary of the 
        Treasury.
          ``(II) 50 percent of the amount of payments received 
        under subparagraph (A)(ii) and clause (ii) shall, in 
        accordance with section 524 of the Tariff Act of 1930, 
        be deposited as a refund to the appropriation for the 
        amount paid out of that appropriation for the costs 
        incurred in providing services to express consignment 
        carrier facilities or centralized hub facilities. 
        Amounts deposited in accordance with the preceding 
        sentence shall be available until expended for the 
        provision of customs services to express consignment 
        carrier facilities or centralized hub facilities.
          ``(III) Notwithstanding section 524 of the Tariff Act 
        of 1930, the remaining 50 percent of the amount of 
        payments received under subparagraph (A)(ii) and clause 
        (ii) shall be paid to the Secretary of the Treasury, 
        which is in lieu of the payment of fees under 
        subsection (a)(10) of this section.''.
  (b) Effective Date.--The amendments made by subsection (a) 
take effect on October 1, 2002.

SEC. 338. NATIONAL CUSTOMS AUTOMATION PROGRAM.

  Section 411(b) of the Tariff Act of 1930 (19 U.S.C. 1411(b)) 
is amended by striking the second sentence and inserting the 
following: ``The Secretary may, by regulation, require the 
electronic submission of information described in subsection 
(a) or any other information required to be submitted to the 
Customs Service separately pursuant to this subpart.''.

                  CHAPTER 4--ANTITERRORISM PROVISIONS


SEC. 341. IMMUNITY FOR UNITED STATES OFFICIALS THAT ACT IN GOOD FAITH.

  (a) Immunity.--Section 3061 of the Revised Statutes (19 
U.S.C. 482) is amended--
          (1) by striking ``Any of the officers'' and inserting 
        ``(a) Any of the officers''; and
          (2) by adding at the end the following:
  ``(b) Any officer or employee of the United States conducting 
a search of a person pursuant to subsection (a) shall not be 
held liable for any civil damages as a result of such search if 
the officer or employee performed the search in good faith.''.
  (b) Requirement To Post Policy and Procedures for Searches of 
Passengers.--Not later than 30 days after the date of the 
enactment of this Act, the Commissioner of the Customs Service 
shall ensure that at each Customs border facility appropriate 
notice is posted that provides a summary of the policy and 
procedures of the Customs Service for searching passengers, 
including a statement of the policy relating to the prohibition 
on the conduct of profiling of passengers based on gender, 
race, color, religion, or ethnic background.

SEC. 342. EMERGENCY ADJUSTMENTS TO OFFICES, PORTS OF ENTRY, OR STAFFING 
                    OF THE CUSTOMS SERVICE.

  Section 318 of the Tariff Act of 1930 (19 U.S.C. 1318) is 
amended--
          (1) by striking ``Whenever the President'' and 
        inserting ``(a) Whenever the President''; and
          (2) by adding at the end the following:
  ``(b)(1) Notwithstanding any other provision of law, the 
Secretary of the Treasury, when necessary to respond to a 
national emergency declared under the National Emergencies Act 
(50 U.S.C. 1601 et seq.) or to a specific threat to human life 
or national interests, is authorized to take the following 
actions on a temporary basis:
          ``(A) Eliminate, consolidate, or relocate any office 
        or port of entry of the Customs Service.
          ``(B) Modify hours of service, alter services 
        rendered at any location, or reduce the number of 
        employees at any location.
          ``(C) Take any other action that may be necessary to 
        directly respond to the national emergency or specific 
        threat.
  ``(2) Notwithstanding any other provision of law, the 
Commissioner of Customs, when necessary to respond to a 
specific threat to human life or national interests, is 
authorized to close temporarily any Customs office or port of 
entry or take any other lesser action that may be necessary to 
respond to the specific threat.
  ``(3) The Secretary of the Treasury or the Commissioner of 
Customs, as the case may be, shall notify the Committee on Ways 
and Means of the House of Representatives and the Committee on 
Finance of the Senate not later than 72 hours after taking any 
action under paragraph (1) or (2).''.

SEC. 343. MANDATORY ADVANCED ELECTRONIC INFORMATION FOR CARGO AND 
                    PASSENGERS.

  (a) Cargo Information.--
          (1) In general.--Section 431(b) of the Tariff Act of 
        1930 (19 U.S.C. 1431(b)) is amended--
                  (A) in the first sentence, by striking ``Any 
                manifest'' and inserting ``(1) Any manifest''; 
                and
                  (B) by adding at the end the following:
  ``(2)(A) In addition to any other requirement under this 
section, for each land, air, or vessel carrier required to make 
entry under the customs laws of the United States, the pilot, 
the master, operator, or owner of such carrier (or the 
authorized agent of such operator or owner) shall provide by 
electronic transmission cargo manifest information in advance 
of such entry in such manner, time, and form as prescribed 
under regulations by the Secretary. The Secretary may exclude 
any class of land, air, or vessel carrier for which the 
Secretary concludes the requirements of this subparagraph are 
not necessary.
  ``(B) The Secretary shall cooperate with other appropriate 
Federal departments and agencies for the purpose of providing 
to such departments and agencies as soon as practicable cargo 
manifest information obtained pursuant to subparagraph (A). In 
carrying out the preceding sentence, the Secretary, to the 
maximum extent practicable, shall protect the privacy and 
property rights with respect to the cargo involved.''.
          (2) Conforming amendments.--Subparagraphs (A) and (C) 
        of section 431(d)(1) of such Act are each amended by 
        inserting before the semicolon ``or subsection 
        (b)(2)''.
  (b) Passenger Information.--Part II of title IV of the Tariff 
Act of 1930 (19 U.S.C. 1431 et seq.) is amended by inserting 
after section 431 the following:

``SEC. 432. PASSENGER AND CREW INFORMATION REQUIRED FOR LAND, AIR, OR 
                    VESSEL CARRIERS.

  ``(a) In General.--For every person arriving or departing on 
a land, air, or vessel carrier required to make entry or obtain 
clearance under the customs laws of the United States, the 
pilot, the master, operator, or owner of such carrier (or the 
authorized agent of such operator or owner) shall provide by 
electronic transmission information described in subsection (b) 
in advance of such entry or clearance in such manner, time, and 
form as prescribed under regulations by the Secretary.
  ``(b) Information Described.--The information described in 
this subsection shall include for each person described in 
subsection (a), if applicable, the person's--
          ``(1) full name;
          ``(2) date of birth and citizenship;
          ``(3) gender;
          ``(4) passport number and country of issuance;
          ``(5) United States visa number or resident alien 
        card number;
          ``(6) passenger name record; and
          ``(7) such additional information that the Secretary, 
        by regulation, determines is reasonably necessary to 
        ensure aviation and maritime safety pursuant to the 
        laws enforced or administered by the Customs Service.
  ``(c) Sharing of Information.--The Secretary shall cooperate 
with other appropriate Federal departments and agencies for the 
purpose of providing to such departments and agencies as soon 
as practicable electronic transmission information obtained 
pursuant to subsection (a). In carrying out the preceding 
sentence, the Secretary, to the maximum extent practicable, 
shall protect the privacy rights of the person with respect to 
which the information relates.''.
  (c) Definition.--Section 401 of the Tariff Act of 1930 (19 
U.S.C. 1401) is amended by adding at the end the following:
  ``(t) The term `land, air, or vessel carrier' means a land, 
air, or vessel carrier, as the case may be, that transports 
goods or passengers for payment or other consideration, 
including money or services rendered.''.
  (d) Effective Date.--The amendments made by this section 
shall take effect beginning 45 days after the date of the 
enactment of this Act.

SEC. 344. BORDER SEARCH AUTHORITY FOR CERTAIN CONTRABAND IN OUTBOUND 
                    MAIL.

  The Tariff Act of 1930 is amended by inserting after section 
582 the following:

``SEC. 583. EXAMINATION OF OUTBOUND MAIL.

  ``(a) Examination.--
          ``(1) In general.--For purposes of ensuring 
        compliance with the Customs laws of the United States 
        and other laws enforced by the Customs Service, 
        including the provisions of law described in paragraph 
        (2), a Customs officer may, subject to the provisions 
        of this section, stop and search at the border, without 
        a search warrant, mail of domestic origin transmitted 
        for export by the United States Postal Service and 
        foreign mail transiting the United States that is being 
        imported or exported by the United States Postal 
        Service.
          ``(2) Provisions of law described.--The provisions of 
        law described in this paragraph are the following:
                  ``(A) Section 5316 of title 31, United States 
                Code (relating to reports on exporting and 
                importing monetary instruments).
                  ``(B) Sections 1461, 1463, 1465, and 1466 and 
                chapter 110 of title 18, United States Code 
                (relating to obscenity and child pornography).
                  ``(C) Section 1003 of the Controlled 
                Substances Import and Export Act (21 U.S.C. 
                953; relating to exportation of controlled 
                substances).
                  ``(D) The Export Administration Act of 1979 
                (50 U.S.C. app. 2401 et seq.).
                  ``(E) Section 38 of the Arms Export Control 
                Act (22 U.S.C. 2778).
                  ``(F) The International Emergency Economic 
                Powers Act (50 U.S.C. 1701 et seq.).
  ``(b) Search of Mail Not Sealed Against Inspection and Other 
Mail.--Mail not sealed against inspection under the postal laws 
and regulations of the United States, mail which bears a 
customs declaration, and mail with respect to which the sender 
or addressee has consented in writing to search, may be 
searched by a Customs officer.
  ``(c) Search of Mail Sealed Against Inspection.--(1) Mail 
sealed against inspection under the postal laws and regulations 
of the United States may be searched by a Customs officer, 
subject to paragraph (2), upon reasonable cause to suspect that 
such mail contains one or more of the following:
          ``(A) Monetary instruments, as defined in section 
        1956 of title 18, United States Code.
          ``(B) A weapon of mass destruction, as defined in 
        section 2332a(b) of title 18, United States Code.
          ``(C) A drug or other substance listed in schedule I, 
        II, III, or IV in section 202 of the Controlled 
        Substances Act (21 U.S.C. 812).
          ``(D) National defense and related information 
        transmitted in violation of any of sections 793 through 
        798 of title 18, United States Code.
          ``(E) Merchandise mailed in violation of section 1715 
        or 1716 of title 18, United States Code.
          ``(F) Merchandise mailed in violation of any 
        provision of chapter 71 (relating to obscenity) or 
        chapter 110 (relating to sexual exploitation and other 
        abuse of children) of title 18, United States Code.
          ``(G) Merchandise mailed in violation of the Export 
        Administration Act of 1979 (50 U.S.C. app. 2401 et 
        seq.).
          ``(H) Merchandise mailed in violation of section 38 
        of the Arms Export Control Act (22 U.S.C. 2778).
          ``(I) Merchandise mailed in violation of the 
        International Emergency Economic Powers Act (50 U.S.C. 
        1701 et seq.).
          ``(J) Merchandise mailed in violation of the Trading 
        with the Enemy Act (50 U.S.C. app. 1 et seq.).
          ``(K) Merchandise subject to any other law enforced 
        by the Customs Service.
  ``(2) No person acting under authority of paragraph (1) shall 
read, or authorize any other person to read, any correspondence 
contained in mail sealed against inspection unless prior to so 
reading--
          ``(A) a search warrant has been issued pursuant to 
        Rule 41, Federal Rules of Criminal Procedure; or
          ``(B) the sender or addressee has given written 
        authorization for such reading.''.

SEC. 345. AUTHORIZATION OF APPROPRIATIONS FOR REESTABLISHMENT OF 
                    CUSTOMS OPERATIONS IN NEW YORK CITY.

  (a) Authorization of Appropriations.--
          (1) In general.--There is authorized to be 
        appropriated for the reestablishment of operations of 
        the Customs Service in New York, New York, such sums as 
        may be necessary for fiscal year 2002.
          (2) Operations described.--The operations referred to 
        in paragraph (1) include, but are not limited to, the 
        following:
                  (A) Operations relating to the Port Director 
                of New York City, the New York Customs 
                Management Center (including the Director of 
                Field Operations), and the Special Agent-In-
                Charge for New York.
                  (B) Commercial operations, including textile 
                enforcement operations and salaries and 
                expenses of--
                          (i) trade specialists who determine 
                        the origin and value of merchandise;
                          (ii) analysts who monitor the entry 
                        data into the United States of textiles 
                        and textile products; and
                          (iii) Customs officials who work with 
                        foreign governments to examine textile 
                        makers and verify entry information.
  (b) Availability.--Amounts appropriated pursuant to the 
authorization of appropriations under subsection (a) are 
authorized to remain available until expended.

              CHAPTER 5--TEXTILE TRANSSHIPMENT PROVISIONS


SEC. 351. GAO AUDIT OF TEXTILE TRANSSHIPMENT MONITORING BY CUSTOMS 
                    SERVICE.

  (a) GAO Audit.--The Comptroller General of the United States 
shall conduct an audit of the system established and carried 
out by the Customs Service to monitor textile transshipment.
  (b) Report.--Not later than 9 months after the date of 
enactment of this Act, the Comptroller General shall submit to 
the Committee on Ways and Means of the House of Representatives 
and Committee on Finance of the Senate a report that contains 
the results of the study conducted under subsection (a), 
including recommendations for improvements to the transshipment 
monitoring system if applicable.
  (c) Transshipment Described.--Transshipment within the 
meaning of this section has occurred when preferential 
treatment under any provision of law has been claimed for a 
textile or apparel article on the basis of material false 
information concerning the country of origin, manufacture, 
processing, or assembly of the article or any of its 
components. For purposes of the preceding sentence, false 
information is material if disclosure of the true information 
would mean or would have meant that the article is or was 
ineligible for preferential treatment under the provision of 
law in question.

SEC. 352. AUTHORIZATION OF APPROPRIATIONS FOR TEXTILE TRANSSHIPMENT 
                    ENFORCEMENT OPERATIONS.

  (a) Authorization of Appropriations.--
          (1) In general.--There is authorized to be 
        appropriated for textile transshipment enforcement 
        operations of the Customs Service $9,500,000 for fiscal 
        year 2002.
          (2) Availability.--Amounts appropriated pursuant to 
        the authorization of appropriations under paragraph (1) 
        are authorized to remain available until expended.
  (b) Use of Funds.--Of the amount appropriated pursuant to the 
authorization of appropriations under subsection (a), the 
following amounts are authorized to be made available for the 
following purposes:
          (1) Import specialists.--$1,463,000 for 21 Customs 
        import specialists to be assigned to selected ports for 
        documentation review to support detentions and 
        exclusions and 1 additional Customs import specialist 
        assigned to the Customs headquarters textile program to 
        administer the program and provide oversight.
          (2) Inspectors.--$652,080 for 10 Customs inspectors 
        to be assigned to selected ports to examine targeted 
        high-risk shipments.
          (3) Investigators.--(A) $1,165,380 for 10 
        investigators to be assigned to selected ports to 
        investigate instances of smuggling, quota and trade 
        agreement circumvention, and use of counterfeit visas 
        to enter inadmissible goods.
          (B) $149,603 for 1 investigator to be assigned to 
        Customs headquarters textile program to coordinate and 
        ensure implementation of textile production 
        verification team results from an investigation 
        perspective.
          (4) International trade specialists.--$226,500 for 3 
        international trade specialists to be assigned to 
        Customs headquarters to be dedicated to illegal textile 
        transshipment policy issues and other free trade 
        agreement enforcement issues.
          (5) Permanent import specialists for hong kong.--
        $500,000 for 2 permanent import specialist positions 
        and $500,000 for 2 investigators to be assigned to Hong 
        Kong to work with Hong Kong and other government 
        authorities in Southeast Asia to assist such 
        authorities pursue proactive enforcement of bilateral 
        trade agreements.
          (6) Various permanent trade positions.--$3,500,000 
        for the following:
                  (A) 2 permanent positions to be assigned to 
                the Customs attache office in Central America 
                to address trade enforcement issues for that 
                region.
                  (B) 2 permanent positions to be assigned to 
                the Customs attache office in South Africa to 
                address trade enforcement issues pursuant to 
                the African Growth and Opportunity Act (title I 
                of Public Law 106-200).
                  (C) 4 permanent positions to be assigned to 
                the Customs attache office in Mexico to address 
                the threat of illegal textile transshipment 
                through Mexico and other related issues under 
                the North American Free Trade Agreement Act.
                  (D) 2 permanent positions to be assigned to 
                the Customs attache office in Seoul, South 
                Korea, to address the trade issues in the 
                geographic region.
                  (E) 2 permanent positions to be assigned to 
                the proposed Customs attache office in New 
                Delhi, India, to address the threat of illegal 
                textile transshipment and other trade 
                enforcement issues.
                  (F) 2 permanent positions to be assigned to 
                the Customs attache office in Rome, Italy, to 
                address trade enforcement issues in the 
                geographic region, including issues under free 
                trade agreements with Jordan and Israel.
          (7) Attorneys.--$179,886 for 2 attorneys for the 
        Office of the Chief Counsel of the Customs Service to 
        pursue cases regarding illegal textile transshipment.
          (8) Auditors.--$510,000 for 6 Customs auditors to 
        perform internal control reviews and document and 
        record reviews of suspect importers.
          (9) Additional travel funds.--$250,000 for deployment 
        of additional textile production verification teams to 
        sub-Saharan Africa.
          (10) Training.--(A) $75,000 for training of Customs 
        personnel.
          (B) $200,000 for training for foreign counterparts in 
        risk management analytical techniques and for teaching 
        factory inspection techniques, model law Development, 
        and enforcement techniques.
          (11) Outreach.--$60,000 for outreach efforts to 
        United States importers.

SEC. 353. IMPLEMENTATION OF THE AFRICAN GROWTH AND OPPORTUNITY ACT.

  Of the amount made available for fiscal year 2002 under 
section 301(b)(2)(A) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 2075(b)(2)(A)), as 
amended by section 311(b)(1) of this Act, $1,317,000 shall be 
available until expended for the Customs Service to provide 
technical assistance to help sub-Saharan Africa countries 
develop and implement effective visa and anti-transshipment 
systems as required by the African Growth and Opportunity Act 
(title I of Public Law 106-200), as follows:
          (1) Travel funds.--$600,000 for import specialists, 
        special agents, and other qualified Customs personnel 
        to travel to sub-Saharan Africa countries to provide 
        technical assistance in developing and implementing 
        effective visa and anti-transshipment systems.
          (2) Import specialists.--$266,000 for 4 import 
        specialists to be assigned to Customs headquarters to 
        be dedicated to providing technical assistance to sub-
        Saharan African countries for developing and 
        implementing effective visa and anti-transshipment 
        systems.
          (3) Data reconciliation analysts.--$151,000 for 2 
        data reconciliation analysts to review apparel 
        shipments.
          (4) Special agents.--$300,000 for 2 special agents to 
        be assigned to Customs headquarters to be available to 
        provide technical assistance to sub-Saharan African 
        countries in the performance of investigations and 
        other enforcement initiatives.

      Subtitle B--Office of the United States Trade Representative

SEC. 361. AUTHORIZATION OF APPROPRIATIONS.

  (a) In General.--Section 141(g)(1) of the Trade Act of 1974 
(19 U.S.C. 2171(g)(1)) is amended--
          (1) in subparagraph (A)--
                  (A) in the matter preceding clause (i), by 
                striking ``not to exceed'';
                  (B) in clause (i) to read as follows:
          ``(i) $30,000,000 for fiscal year 2002.'';
                  (C) in clause (ii) to read as follows:
          ``(ii) $32,300,000 for fiscal year 2003.''; and
                  (D) by adding at the end the following:
          ``(iii) $33,108,000 for fiscal year 2004.''; and
          (2) in subparagraph (B)--
                  (A) in clause (i), by adding ``and'' at the 
                end;
                  (B) by striking clause (ii); and
                  (C) by redesignating clause (iii) as clause 
                (ii).
  (b) Submission of Out-Year Budget Projections.--Section 
141(g) of the Trade Act of 1974 (19 U.S.C. 2171(g)) is amended 
by adding at the end the following:
  ``(3) By not later than the date on which the President 
submits to Congress the budget of the United States Government 
for a fiscal year, the United States Trade Representative shall 
submit to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate the 
projected amount of funds for the succeeding fiscal year that 
will be necessary for the Office to carry out its functions.''.
  (c) Additional Staff for Office of Assistant U.S. Trade 
Representative for Congressional Affairs.--
          (1) In general.--There is authorized to be 
        appropriated such sums as may be necessary for fiscal 
        year 2002 for the salaries and expenses of two 
        additional legislative specialist employee positions 
        within the Office of the Assistant United States Trade 
        Representative for Congressional Affairs.
          (2) Availability.--Amounts appropriated pursuant to 
        the authorization of appropriations under paragraph (1) 
        are authorized to remain available until expended.

        Subtitle C--United States International Trade Commission

SEC. 371. AUTHORIZATION OF APPROPRIATIONS.

  (a) In General.--Section 330(e)(2)(A) of the Tariff Act of 
1930 (19 U.S.C. 1330(e)(2)) is amended--
          (1) in clause (i) to read as follows:
          ``(i) $51,440,000 for fiscal year 2002.'';
          (2) in clause (ii) to read as follows:
          ``(ii) $54,000,000 for fiscal year 2003.''; and
          (3) by adding at the end the following:
          ``(iii) $57,240,000 for fiscal year 2004.''.
  (b) Submission of Out-Year Budget Projections.--Section 
330(e) of the Tariff Act of 1930 (19 U.S.C. 1330(e)(2)) is 
amended by adding at the end the following:
  ``(4) By not later than the date on which the President 
submits to Congress the budget of the United States Government 
for a fiscal year, the Commission shall submit to the Committee 
on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate the projected amount of 
funds for the succeeding fiscal year that will be necessary for 
the Commission to carry out its functions.''.

                   Subtitle D--Other trade provisions

SEC. 381. INCREASE IN AGGREGATE VALUE OF ARTICLES EXEMPT FROM DUTY 
                    ACQUIRED ABROAD BY UNITED STATES RESIDENTS.

  (a) In General.--Subheading 9804.00.65 of the Harmonized 
Tariff Schedule of the United States is amended in the article 
description column by striking ``$400'' and inserting ``$800''.
  (b) Effective Date.--The amendment made by subsection (a) 
shall take effect 90 days after the date of the enactment of 
this Act.

SEC. 382. REGULATORY AUDIT PROCEDURES.

  Section 509(b) of the Tariff Act of 1930 (19 U.S.C. 1509(b)) 
is amended by adding at the end the following:
          ``(6)(A) If during the course of any audit concluded 
        under this subsection, the Customs Service identifies 
        overpayments of duties or fees or over-declarations of 
        quantities or values that are within the time period 
        and scope of the audit that the Customs Service has 
        defined, then in calculating the loss of revenue or 
        monetary penalties under section 592, the Customs 
        Service shall treat the overpayments or over-
        declarations on finally liquidated entries as an offset 
        to any underpayments or underdeclarations also 
        identified on finally liquidated entries if such 
        overpayments or over-declarations were not made by the 
        person being audited for the purpose of violating any 
        provision of law.
          ``(B) Nothing in this paragraph shall be construed to 
        authorize a refund not otherwise authorized under 
        section 520.''.

            DIVISION B--BIPARTISAN TRADE PROMOTION AUTHORITY

                  TITLE XXI--TRADE PROMOTION AUTHORITY

SEC. 2101. SHORT TITLE AND FINDINGS.

  (a) Short Title.--This title may be cited as the ``Bipartisan 
Trade Promotion Authority Act of 2002''.
  (b) Findings.--The Congress makes the following findings:
          (1) The expansion of international trade is vital to 
        the national security of the United States. Trade is 
        critical to the economic growth and strength of the 
        United States and to its leadership in the world. 
        Stable trading relationships promote security and 
        prosperity. Trade agreements today serve the same 
        purposes that security pacts played during the Cold 
        War, binding nations together through a series of 
        mutual rights and obligations. Leadership by the United 
        States in international trade fosters open markets, 
        democracy, and peace throughout the world.
          (2) The national security of the United States 
        depends on its economic security, which in turn is 
        founded upon a vibrant and growing industrial base. 
        Trade expansion has been the engine of economic growth. 
        Trade agreements maximize opportunities for the 
        critical sectors and building blocks of the economy of 
        the United States, such as information technology, 
        telecommunications and other leading technologies, 
        basic industries, capital equipment, medical equipment, 
        services, agriculture, environmental technology, and 
        intellectual property. Trade will create new 
        opportunities for the United States and preserve the 
        unparalleled strength of the United States in economic, 
        political, and military affairs. The United States, 
        secured by expanding trade and economic opportunities, 
        will meet the challenges of the twenty-first century.
          (3) At the same time, the recent pattern of decisions 
        by dispute settlement panels and the Appellate Body of 
        the World Trade Organization to impose obligations and 
        restrictions on the use of antidumping and 
        countervailing measures by WTO members under the 
        Antidumping Agreement and the Agreement on Subsidies 
        and Countervailing Measures has raised concerns, and 
        Congress is concerned that dispute settlement panels 
        and the Appellate Body of the WTO appropriately apply 
        the standard of review contained in Article 17.6 of the 
        Antidumping Agreement, to provide deference to a 
        permissible interpretation by a WTO member of 
        provisions of the Antidumping Agreement, and to the 
        evaluation by a WTO member of the facts where that 
        evaluation is unbiased and objective and the 
        establishment of the facts is proper.

SEC. 2102. TRADE NEGOTIATING OBJECTIVES.

  (a) Overall Trade Negotiating Objectives.--The overall trade 
negotiating objectives of the United States for agreements 
subject to the provisions of section 2103 are--
          (1) to obtain more open, equitable, and reciprocal 
        market access;
          (2) to obtain the reduction or elimination of 
        barriers and distortions that are directly related to 
        trade and that decrease market opportunities for United 
        States exports or otherwise distort United States 
        trade;
          (3) to further strengthen the system of international 
        trading disciplines and procedures, including dispute 
        settlement;
          (4) to foster economic growth, raise living 
        standards, and promote full employment in the United 
        States and to enhance the global economy;
          (5) to ensure that trade and environmental policies 
        are mutually supportive and to seek to protect and 
        preserve the environment and enhance the international 
        means of doing so, while optimizing the use of the 
        world's resources;
          (6) to promote respect for worker rights and the 
        rights of children consistent with core labor standards 
        of the International Labor Organization (as defined in 
        section 2111(2)) and an understanding of the 
        relationship between trade and worker rights; and
          (7) to seek provisions in trade agreements under 
        which parties to those agreements strive to ensure that 
        they do not weaken or reduce the protections afforded 
        in domestic environmental and labor laws as an 
        encouragement for trade.
  (b) Principal Trade Negotiating Objectives.--
          (1) Trade barriers and distortions.--The principal 
        negotiating objectives of the United States regarding 
        trade barriers and other trade distortions are--
                  (A) to expand competitive market 
                opportunities for United States exports and to 
                obtain fairer and more open conditions of trade 
                by reducing or eliminating tariff and nontariff 
                barriers and policies and practices of foreign 
                governments directly related to trade that 
                decrease market opportunities for United States 
                exports or otherwise distort United States 
                trade; and
                  (B) to obtain reciprocal tariff and nontariff 
                barrier elimination agreements, with particular 
                attention to those tariff categories covered in 
                section 111(b) of the Uruguay Round Agreements 
                Act (19 U.S.C. 3521(b)).
          (2) Trade in services.--The principal negotiating 
        objective of the United States regarding trade in 
        services is to reduce or eliminate barriers to 
        international trade in services, including regulatory 
        and other barriers that deny national treatment and 
        market access or unreasonably restrict the 
        establishment or operations of service suppliers.
          (3) Foreign investment.--The principal negotiating 
        objective of the United States regarding foreign 
        investment is to reduce or eliminate artificial or 
        trade-distorting barriers to trade-related foreign 
        investment and, recognizing that United States law on 
        the whole provides a high level of protection for 
        investment, consistent with or greater than the level 
        required by international law, to secure for investors 
        important rights comparable to those that would be 
        available under United States legal principles and 
        practice, by--
                  (A) reducing or eliminating exceptions to the 
                principle of national treatment;
                  (B) freeing the transfer of funds relating to 
                investments;
                  (C) reducing or eliminating performance 
                requirements, forced technology transfers, and 
                other unreasonable barriers to the 
                establishment and operation of investments;
                  (D) seeking to establish standards for 
                expropriation and compensation for 
                expropriation, consistent with United States 
                legal principles and practice;
                  (E) providing meaningful procedures for 
                resolving investment disputes;
                  (F) seeking to improve mechanisms used to 
                resolve disputes between an investor and a 
                government through--
                          (i) mechanisms to eliminate frivolous 
                        claims; and
                          (ii) procedures to ensure the 
                        efficient selection of arbitrators and 
                        the expeditious disposition of claims;
                  (G) providing an appellate or similar review 
                mechanism to correct manifestly erroneous 
                interpretations of law; and
                  (H) ensuring the fullest measure of 
                transparency in the dispute settlement 
                mechanism, to the extent consistent with the 
                need to protect information that is classified 
                or business confidential, by--
                          (i) ensuring that all requests for 
                        dispute settlement are promptly made 
                        public;
                          (ii) ensuring that--
                                  (I) all proceedings, 
                                submissions, findings, and 
                                decisions are promptly made 
                                public; and
                                  (II) all hearings are open to 
                                the public; and
                          (iii) establishing a mechanism for 
                        acceptance of amicus curiae submissions 
                        from businesses, unions, and 
                        nongovernmental organizations.
          (4) Intellectual property.--The principal negotiating 
        objectives of the United States regarding trade-related 
        intellectual property are--
                  (A) to further promote adequate and effective 
                protection of intellectual property rights, 
                including through--
                          (i)(I) ensuring accelerated and full 
                        implementation of the Agreement on 
                        Trade-Related Aspects of Intellectual 
                        Property Rights referred to in section 
                        101(d)(15) of the Uruguay Round 
                        Agreements Act (19 U.S.C. 3511(d)(15)), 
                        particularly with respect to meeting 
                        enforcement obligations under that 
                        agreement; and
                          (II) ensuring that the provisions of 
                        any multilateral or bilateral trade 
                        agreement governing intellectual 
                        property rights that is entered into by 
                        the United States reflect a standard of 
                        protection similar to that found in 
                        United States law;
                          (ii) providing strong protection for 
                        new and emerging technologies and new 
                        methods of transmitting and 
                        distributing products embodying 
                        intellectual property;
                          (iii) preventing or eliminating 
                        discrimination with respect to matters 
                        affecting the availability, 
                        acquisition, scope, maintenance, use, 
                        and enforcement of intellectual 
                        property rights;
                          (iv) ensuring that standards of 
                        protection and enforcement keep pace 
                        with technological developments, and in 
                        particular ensuring that rightholders 
                        have the legal and technological means 
                        to control the use of their works 
                        through the Internet and other global 
                        communication media, and to prevent the 
                        unauthorized use of their works; and
                          (v) providing strong enforcement of 
                        intellectual property rights, including 
                        through accessible, expeditious, and 
                        effective civil, administrative, and 
                        criminal enforcement mechanisms; and
                  (B) to secure fair, equitable, and 
                nondiscriminatory market access opportunities 
                for United States persons that rely upon 
                intellectual property protection.
          (5) Transparency.--The principal negotiating 
        objective of the United States with respect to 
        transparency is to obtain wider and broader application 
        of the principle of transparency through--
                  (A) increased and more timely public access 
                to information regarding trade issues and the 
                activities of international trade institutions;
                  (B) increased openness at the WTO and other 
                international trade fora by increasing public 
                access to appropriate meetings, proceedings, 
                and submissions, including with regard to 
                dispute settlement and investment; and
                  (C) increased and more timely public access 
                to all notifications and supporting 
                documentation submitted by parties to the WTO.
          (6) Anti-corruption.--The principal negotiating 
        objectives of the United States with respect to the use 
        of money or other things of value to influence acts, 
        decisions, or omissions of foreign governments or 
        officials or to secure any improper advantage in a 
        manner affecting trade are--
                  (A) to obtain high standards and appropriate 
                domestic enforcement mechanisms applicable to 
                persons from all countries participating in the 
                applicable trade agreement that prohibit such 
                attempts to influence acts, decisions, or 
                omissions of foreign governments; and
                  (B) to ensure that such standards do not 
                place United States persons at a competitive 
                disadvantage in international trade.
          (7) Improvement of the wto and multilateral trade 
        agreements.--The principal negotiating objectives of 
        the United States regarding the improvement of the 
        World Trade Organization, the Uruguay Round Agreements, 
        and other multilateral and bilateral trade agreements 
        are--
                  (A) to achieve full implementation and extend 
                the coverage of the World Trade Organization 
                and such agreements to products, sectors, and 
                conditions of trade not adequately covered; and
                  (B) to expand country participation in and 
                enhancement of the Information Technology 
                Agreement and other trade agreements.
          (8) Regulatory practices.--The principal negotiating 
        objectives of the United States regarding the use of 
        government regulation or other practices by foreign 
        governments to provide a competitive advantage to their 
        domestic producers, service providers, or investors and 
        thereby reduce market access for United States goods, 
        services, and investments are--
                  (A) to achieve increased transparency and 
                opportunity for the participation of affected 
                parties in the development of regulations;
                  (B) to require that proposed regulations be 
                based on sound science, cost-benefit analysis, 
                risk assessment, or other objective evidence;
                  (C) to establish consultative mechanisms 
                among parties to trade agreements to promote 
                increased transparency in developing 
                guidelines, rules, regulations, and laws for 
                government procurement and other regulatory 
                regimes; and
                  (D) to achieve the elimination of government 
                measures such as price controls and reference 
                pricing which deny full market access for 
                United States products.
          (9) Electronic commerce.--The principal negotiating 
        objectives of the United States with respect to 
        electronic commerce are--
                  (A) to ensure that current obligations, 
                rules, disciplines, and commitments under the 
                World Trade Organization apply to electronic 
                commerce;
                  (B) to ensure that--
                          (i) electronically delivered goods 
                        and services receive no less favorable 
                        treatment under trade rules and 
                        commitments than like products 
                        delivered in physical form; and
                          (ii) the classification of such goods 
                        and services ensures the most liberal 
                        trade treatment possible;
                  (C) to ensure that governments refrain from 
                implementing trade-related measures that impede 
                electronic commerce;
                  (D) where legitimate policy objectives 
                require domestic regulations that affect 
                electronic commerce, to obtain commitments that 
                any such regulations are the least restrictive 
                on trade, nondiscriminatory, and transparent, 
                and promote an open market environment; and
                  (E) to extend the moratorium of the World 
                Trade Organization on duties on electronic 
                transmissions.
          (10) Reciprocal trade in agriculture.--(A) The 
        principal negotiating objective of the United States 
        with respect to agriculture is to obtain competitive 
        opportunities for United States exports of agricultural 
        commodities in foreign markets substantially equivalent 
        to the competitive opportunities afforded foreign 
        exports in United States markets and to achieve fairer 
        and more open conditions of trade in bulk, specialty 
        crop, and value-added commodities by--
                  (i) reducing or eliminating, by a date 
                certain, tariffs or other charges that decrease 
                market opportunities for United States 
                exports--
                          (I) giving priority to those products 
                        that are subject to significantly 
                        higher tariffs or subsidy regimes of 
                        major producing countries; and
                          (II) providing reasonable adjustment 
                        periods for United States import-
                        sensitive products, in close 
                        consultation with the Congress on such 
                        products before initiating tariff 
                        reduction negotiations;
                  (ii) reducing tariffs to levels that are the 
                same as or lower than those in the United 
                States;
                  (iii) reducing or eliminating subsidies that 
                decrease market opportunities for United States 
                exports or unfairly distort agriculture markets 
                to the detriment of the United States;
                  (iv) allowing the preservation of programs 
                that support family farms and rural communities 
                but do not distort trade;
                  (v) developing disciplines for domestic 
                support programs, so that production that is in 
                excess of domestic food security needs is sold 
                at world prices;
                  (vi) eliminating Government policies that 
                create price-depressing surpluses;
                  (vii) eliminating state trading enterprises 
                whenever possible;
                  (viii) developing, strengthening, and 
                clarifying rules and effective dispute 
                settlement mechanisms to eliminate practices 
                that unfairly decrease United States market 
                access opportunities or distort agricultural 
                markets to the detriment of the United States, 
                particularly with respect to import-sensitive 
                products, including--
                          (I) unfair or trade-distorting 
                        activities of state trading enterprises 
                        and other administrative mechanisms, 
                        with emphasis on requiring price 
                        transparency in the operation of state 
                        trading enterprises and such other 
                        mechanisms in order to end cross 
                        subsidization, price discrimination, 
                        and price undercutting;
                          (II) unjustified trade restrictions 
                        or commercial requirements, such as 
                        labeling, that affect new technologies, 
                        including biotechnology;
                          (III) unjustified sanitary or 
                        phytosanitary restrictions, including 
                        those not based on scientific 
                        principles in contravention of the 
                        Uruguay Round Agreements;
                          (IV) other unjustified technical 
                        barriers to trade; and
                          (V) restrictive rules in the 
                        administration of tariff rate quotas;
                  (ix) eliminating practices that adversely 
                affect trade in perishable or cyclical 
                products, while improving import relief 
                mechanisms to recognize the unique 
                characteristics of perishable and cyclical 
                agriculture;
                  (x) ensuring that the use of import relief 
                mechanisms for perishable and cyclical 
                agriculture are as accessible and timely to 
                growers in the United States as those 
                mechanisms that are used by other countries;
                  (xi) taking into account whether a party to 
                the negotiations has failed to adhere to the 
                provisions of already existing trade agreements 
                with the United States or has circumvented 
                obligations under those agreements;
                  (xii) taking into account whether a product 
                is subject to market distortions by reason of a 
                failure of a major producing country to adhere 
                to the provisions of already existing trade 
                agreements with the United States or by the 
                circumvention by that country of its 
                obligations under those agreements;
                  (xiii) otherwise ensuring that countries that 
                accede to the World Trade Organization have 
                made meaningful market liberalization 
                commitments in agriculture;
                  (xiv) taking into account the impact that 
                agreements covering agriculture to which the 
                United States is a party, including the North 
                American Free Trade Agreement, have on the 
                United States agricultural industry; and
                  (xv) maintaining bona fide food assistance 
                programs and preserving United States market 
                development and export credit programs.
          (B)(i) Before commencing negotiations with respect to 
        agriculture, the United States Trade Representative, in 
        consultation with the Congress, shall seek to develop a 
        position on the treatment of seasonal and perishable 
        agricultural products to be employed in the 
        negotiations in order to develop an international 
        consensus on the treatment of seasonal or perishable 
        agricultural products in investigations relating to 
        dumping and safeguards and in any other relevant area.
          (ii) During any negotiations on agricultural 
        subsidies, the United States Trade Representative shall 
        seek to establish the common base year for calculating 
        the Aggregated Measurement of Support (as defined in 
        the Agreement on Agriculture) as the end of each 
        country's Uruguay Round implementation period, as 
        reported in each country's Uruguay Round market access 
        schedule.
          (iii) The negotiating objective provided in 
        subparagraph (A) applies with respect to agricultural 
        matters to be addressed in any trade agreement entered 
        into under section 2103(a) or (b), including any trade 
        agreement entered into under section 2103(a) or (b) 
        that provides for accession to a trade agreement to 
        which the United States is already a party, such as the 
        North American Free Trade Agreement and the United 
        States-Canada Free Trade Agreement.
          (11) Labor and the environment.--The principal 
        negotiating objectives of the United States with 
        respect to labor and the environment are--
                  (A) to ensure that a party to a trade 
                agreement with the United States does not fail 
                to effectively enforce its environmental or 
                labor laws, through a sustained or recurring 
                course of action or inaction, in a manner 
                affecting trade between the United States and 
                that party after entry into force of a trade 
                agreement between those countries;
                  (B) to recognize that parties to a trade 
                agreement retain the right to exercise 
                discretion with respect to investigatory, 
                prosecutorial, regulatory, and compliance 
                matters and to make decisions regarding the 
                allocation of resources to enforcement with 
                respect to other labor or environmental matters 
                determined to have higher priorities, and to 
                recognize that a country is effectively 
                enforcing its laws if a course of action or 
                inaction reflects a reasonable exercise of such 
                discretion, or results from a bona fide 
                decision regarding the allocation of resources 
                and no retaliation may be authorized based on 
                the exercise of these rights or the right to 
                establish domestic labor standards and levels 
                of environmental protection;
                  (C) to strengthen the capacity of United 
                States trading partners to promote respect for 
                core labor standards (as defined in section 
                2111(2));
                  (D) to strengthen the capacity of United 
                States trading partners to protect the 
                environment through the promotion of 
                sustainable development;
                  (E) to reduce or eliminate government 
                practices or policies that unduly threaten 
                sustainable development;
                  (F) to seek market access, through the 
                elimination of tariffs and nontariff barriers, 
                for United States environmental technologies, 
                goods, and services; and
                  (G) to ensure that labor, environmental, 
                health, or safety policies and practices of the 
                parties to trade agreements with the United 
                States do not arbitrarily or unjustifiably 
                discriminate against United States exports or 
                serve as disguised barriers to trade.
          (12) Dispute settlement and enforcement.--The 
        principal negotiating objectives of the United States 
        with respect to dispute settlement and enforcement of 
        trade agreements are--
                  (A) to seek provisions in trade agreements 
                providing for resolution of disputes between 
                governments under those trade agreements in an 
                effective, timely, transparent, equitable, and 
                reasoned manner, requiring determinations based 
                on facts and the principles of the agreements, 
                with the goal of increasing compliance with the 
                agreements;
                  (B) to seek to strengthen the capacity of the 
                Trade Policy Review Mechanism of the World 
                Trade Organization to review compliance with 
                commitments;
                  (C) to seek provisions encouraging the early 
                identification and settlement of disputes 
                through consultation;
                  (D) to seek provisions to encourage the 
                provision of trade-expanding compensation if a 
                party to a dispute under the agreement does not 
                come into compliance with its obligations under 
                the agreement;
                  (E) to seek provisions to impose a penalty 
                upon a party to a dispute under the agreement 
                that--
                          (i) encourages compliance with the 
                        obligations of the agreement;
                          (ii) is appropriate to the parties, 
                        nature, subject matter, and scope of 
                        the violation; and
                          (iii) has the aim of not adversely 
                        affecting parties or interests not 
                        party to the dispute while maintaining 
                        the effectiveness of the enforcement 
                        mechanism; and
                  (F) to seek provisions that treat United 
                States principal negotiating objectives equally 
                with respect to--
                          (i) the ability to resort to dispute 
                        settlement under the applicable 
                        agreement;
                          (ii) the availability of equivalent 
                        dispute settlement procedures; and
                          (iii) the availability of equivalent 
                        remedies.
          (13) WTO extended negotiations.--The principal 
        negotiating objectives of the United States regarding 
        trade in civil aircraft are those set forth in section 
        135(c) of the Uruguay Round Agreements Act (19 U.S.C. 
        3355(c)) and regarding rules of origin are the 
        conclusion of an agreement described in section 132 of 
        that Act (19 U.S.C. 3552).
  (c) Promotion of Certain Priorities.--In order to address and 
maintain United States competitiveness in the global economy, 
the President shall--
          (1) seek greater cooperation between the WTO and the 
        ILO;
          (2) seek to establish consultative mechanisms among 
        parties to trade agreements to strengthen the capacity 
        of United States trading partners to promote respect 
        for core labor standards (as defined in section 
        2111(2)), and report to the Committee on Ways and Means 
        of the House of Representatives and the Committee on 
        Finance of the Senate on the content and operation of 
        such mechanisms;
          (3) seek to establish consultative mechanisms among 
        parties to trade agreements to strengthen the capacity 
        of United States trading partners to develop and 
        implement standards for the protection of the 
        environment and human health based on sound science, 
        and report to the Committee on Ways and Means of the 
        House of Representatives and the Committee on Finance 
        of the Senate on the content and operation of such 
        mechanisms;
          (4) conduct environmental reviews of future trade and 
        investment agreements, consistent with Executive Order 
        13141 of November 16, 1999, and its relevant 
        guidelines, and report to the Committee on Ways and 
        Means of the House of Representatives and the Committee 
        on Finance of the Senate on such reviews;
          (5) review the impact of future trade agreements on 
        United States employment, modeled after Executive Order 
        13141, and report to the Committee on Ways and Means of 
        the House of Representatives and the Committee on 
        Finance of the Senate on such review;
          (6) take into account other legitimate United States 
        domestic objectives including, but not limited to, the 
        protection of legitimate health or safety, essential 
        security, and consumer interests and the law and 
        regulations related thereto;
          (7) have the Secretary of Labor consult with any 
        country seeking a trade agreement with the United 
        States concerning that country's labor laws and provide 
        technical assistance to that country if needed;
          (8) with respect to any trade agreement which the 
        President seeks to implement under trade authorities 
        procedures, submit to the Congress a report describing 
        the extent to which the country or countries that are 
        parties to the agreement have in effect laws governing 
        exploitative child labor;
          (9)(A) preserve the ability of the United States to 
        enforce rigorously its trade laws, including the 
        antidumping and countervailing duty laws, and avoid 
        agreements which lessen the effectiveness of domestic 
        and international disciplines on unfair trade, 
        especially dumping and subsidies, in order to ensure 
        that United States workers, agricultural producers, and 
        firms can compete fully on fair terms and enjoy the 
        benefits of reciprocal trade concessions; and
          (B) ensure that United States exports are not subject 
        to the abusive use of trade laws, including antidumping 
        and countervailing duty laws, by other countries.
          (10) continue to promote consideration of 
        multilateral environmental agreements and consult with 
        parties to such agreements regarding the consistency of 
        any such agreement that includes trade measures with 
        existing environmental exceptions under Article XX of 
        the GATT 1994;
          (11) report to the Committee on Ways and Means of the 
        House of Representatives and the Committee on Finance 
        of the Senate, not later than 12 months after the 
        imposition of a penalty or remedy by the United States 
        permitted by a trade agreement to which this title 
        applies, on the effectiveness of the penalty or remedy 
        applied under United States law in enforcing United 
        States rights under the trade agreement; and
          (12) seek to establish consultative mechanisms among 
        parties to trade agreements to examine the trade 
        consequences of significant and unanticipated currency 
        movements and to scrutinize whether a foreign 
        government engaged in a pattern of manipulating its 
        currency to promote a competitive advantage in 
        international trade.
The report under paragraph (11) shall address whether the 
penalty or remedy was effective in changing the behavior of the 
targeted party and whether the penalty or remedy had any 
adverse impact on parties or interests not party to the 
dispute.
  (d) Consultations.--
          (1) Consultations with congressional advisers.--In 
        the course of negotiations conducted under this title, 
        the United States Trade Representative shall consult 
        closely and on a timely basis with, and keep fully 
        apprised of the negotiations, the Congressional 
        Oversight Group convened under section 2107 and all 
        committees of the House of Representatives and the 
        Senate with jurisdiction over laws that would be 
        affected by a trade agreement resulting from the 
        negotiations.
          (2) Consultation before agreement initialed.--In the 
        course of negotiations conducted under this title, the 
        United States Trade Representative shall--
                  (A) consult closely and on a timely basis 
                (including immediately before initialing an 
                agreement) with, and keep fully apprised of the 
                negotiations, the congressional advisers for 
                trade policy and negotiations appointed under 
                section 161 of the Trade Act of 1974 (19 U.S.C. 
                2211), the Committee on Ways and Means of the 
                House of Representatives, the Committee on 
                Finance of the Senate, and the Congressional 
                Oversight Group convened under section 2107; 
                and
                  (B) with regard to any negotiations and 
                agreement relating to agricultural trade, also 
                consult closely and on a timely basis 
                (including immediately before initialing an 
                agreement) with, and keep fully apprised of the 
                negotiations, the Committee on Agriculture of 
                the House of Representatives and the Committee 
                on Agriculture, Nutrition, and Forestry of the 
                Senate.
  (e) Adherence to Obligations Under Uruguay Round 
Agreements.--In determining whether to enter into negotiations 
with a particular country, the President shall take into 
account the extent to which that country has implemented, or 
has accelerated the implementation of, its obligations under 
the Uruguay Round Agreements.

SEC. 2103. TRADE AGREEMENTS AUTHORITY.

  (a) Agreements Regarding Tariff Barriers.--
          (1) In general.--Whenever the President determines 
        that one or more existing duties or other import 
        restrictions of any foreign country or the United 
        States are unduly burdening and restricting the foreign 
        trade of the United States and that the purposes, 
        policies, priorities, and objectives of this title will 
        be promoted thereby, the President--
                  (A) may enter into trade agreements with 
                foreign countries before--
                          (i) June 1, 2005; or
                          (ii) June 1, 2007, if trade 
                        authorities procedures are extended 
                        under subsection (c); and
                  (B) may, subject to paragraphs (2) and (3), 
                proclaim--
                          (i) such modification or continuance 
                        of any existing duty,
                          (ii) such continuance of existing 
                        duty-free or excise treatment, or
                          (iii) such additional duties,
                as the President determines to be required or 
                appropriate to carry out any such trade 
                agreement.
        The President shall notify the Congress of the 
        President's intention to enter into an agreement under 
        this subsection.
          (2) Limitations.--No proclamation may be made under 
        paragraph (1) that--
                  (A) reduces any rate of duty (other than a 
                rate of duty that does not exceed 5 percent ad 
                valorem on the date of the enactment of this 
                Act) to a rate of duty which is less than 50 
                percent of the rate of such duty that applies 
                on such date of enactment;
                  (B) notwithstanding paragraph (6), reduces 
                the rate of duty below that applicable under 
                the Uruguay Round Agreements, on any 
                agricultural product which was the subject of 
                tariff reductions by the United States as a 
                result of the Uruguay Round Agreements, for 
                which the rate of duty, pursuant to such 
                Agreements, was reduced on January 1, 1995, to 
                a rate which was not less than 97.5 percent of 
                the rate of duty that applied to such article 
                on December 31, 1994; or
                  (C) increases any rate of duty above the rate 
                that applied on the date of the enactment of 
                this Act.
          (3) Aggregate reduction; exemption from staging.--
                  (A) Aggregate reduction.--Except as provided 
                in subparagraph (B), the aggregate reduction in 
                the rate of duty on any article which is in 
                effect on any day pursuant to a trade agreement 
                entered into under paragraph (1) shall not 
                exceed the aggregate reduction which would have 
                been in effect on such day if--
                          (i) a reduction of 3 percent ad 
                        valorem or a reduction of one-tenth of 
                        the total reduction, whichever is 
                        greater, had taken effect on the 
                        effective date of the first reduction 
                        proclaimed under paragraph (1) to carry 
                        out such agreement with respect to such 
                        article; and
                          (ii) a reduction equal to the amount 
                        applicable under clause (i) had taken 
                        effect at 1-year intervals after the 
                        effective date of such first reduction.
                  (B) Exemption from staging.--No staging is 
                required under subparagraph (A) with respect to 
                a duty reduction that is proclaimed under 
                paragraph (1) for an article of a kind that is 
                not produced in the United States. The United 
                States International Trade Commission shall 
                advise the President of the identity of 
                articles that may be exempted from staging 
                under this subparagraph.
          (4) Rounding.--If the President determines that such 
        action will simplify the computation of reductions 
        under paragraph (3), the President may round an annual 
        reduction by an amount equal to the lesser of--
                  (A) the difference between the reduction 
                without regard to this paragraph and the next 
                lower whole number; or
                  (B) one-half of 1 percent ad valorem.
          (5) Other limitations.--A rate of duty reduction that 
        may not be proclaimed by reason of paragraph (2) may 
        take effect only if a provision authorizing such 
        reduction is included within an implementing bill 
        provided for under section 5 and that bill is enacted 
        into law.
          (6) Other tariff modifications.--Notwithstanding 
        paragraphs (1)(B), (2)(A), (2)(C), and (3) through (5), 
        and subject to the consultation and layover 
        requirements of section 115 of the Uruguay Round 
        Agreements Act, the President may proclaim the 
        modification of any duty or staged rate reduction of 
        any duty set forth in Schedule XX, as defined in 
        section 2(5) of that Act, if the United States agrees 
        to such modification or staged rate reduction in a 
        negotiation for the reciprocal elimination or 
        harmonization of duties under the auspices of the World 
        Trade Organization.
          (7) Authority under uruguay round agreements act not 
        affected.--Nothing in this subsection shall limit the 
        authority provided to the President under section 
        111(b) of the Uruguay Round Agreements Act (19 U.S.C. 
        3521(b)).
  (b) Agreements Regarding Tariff and Nontariff Barriers.--
          (1) In general.--(A) Whenever the President 
        determines that--
                  (i) one or more existing duties or any other 
                import restriction of any foreign country or 
                the United States or any other barrier to, or 
                other distortion of, international trade unduly 
                burdens or restricts the foreign trade of the 
                United States or adversely affects the United 
                States economy; or
                  (ii) the imposition of any such barrier or 
                distortion is likely to result in such a 
                burden, restriction, or effect;
        and that the purposes, policies, priorities, and 
        objectives of this title will be promoted thereby, the 
        President may enter into a trade agreement described in 
        subparagraph (B) during the period described in 
        subparagraph (C).
          (B) The President may enter into a trade agreement 
        under subparagraph (A) with foreign countries providing 
        for--
                  (i) the reduction or elimination of a duty, 
                restriction, barrier, or other distortion 
                described in subparagraph (A), or
                  (ii) the prohibition of, or limitation on the 
                imposition of, such barrier or other 
                distortion.
          (C) The President may enter into a trade agreement 
        under this paragraph before--
                  (i) June 1, 2005; or
                  (ii) June 1, 2007, if trade authorities 
                procedures are extended under subsection (c).
          (2) Conditions.--A trade agreement may be entered 
        into under this subsection only if such agreement makes 
        progress in meeting the applicable objectives described 
        in section 2102(a) and (b) and the President satisfies 
        the conditions set forth in section 2104.
          (3) Bills qualifying for trade authorities 
        procedures.--(A) The provisions of section 151 of the 
        Trade Act of 1974 (in this title referred to as ``trade 
        authorities procedures'') apply to a bill of either 
        House of Congress which contains provisions described 
        in subparagraph (B) to the same extent as such section 
        151 applies to implementing bills under that section. A 
        bill to which this paragraph applies shall hereafter in 
        this title be referred to as an ``implementing bill''.
          (B) The provisions referred to in subparagraph (A) 
        are--
                  (i) a provision approving a trade agreement 
                entered into under this subsection and 
                approving the statement of administrative 
                action, if any, proposed to implement such 
                trade agreement; and
                  (ii) if changes in existing laws or new 
                statutory authority are required to implement 
                such trade agreement or agreements, provisions, 
                necessary or appropriate to implement such 
                trade agreement or agreements, either repealing 
                or amending existing laws or providing new 
                statutory authority.
  (c) Extension Disapproval Process for Congressional Trade 
Authorities Procedures.--
          (1) In general.--Except as provided in section 
        2105(b)--
                  (A) the trade authorities procedures apply to 
                implementing bills submitted with respect to 
                trade agreements entered into under subsection 
                (b) before July 1, 2005; and
                  (B) the trade authorities procedures shall be 
                extended to implementing bills submitted with 
                respect to trade agreements entered into under 
                subsection (b) after June 30, 2005, and before 
                July 1, 2007, if (and only if)--
                          (i) the President requests such 
                        extension under paragraph (2); and
                          (ii) neither House of the Congress 
                        adopts an extension disapproval 
                        resolution under paragraph (5) before 
                        June 1, 2005.
          (2) Report to congress by the president.--If the 
        President is of the opinion that the trade authorities 
        procedures should be extended to implementing bills 
        described in paragraph (1)(B), the President shall 
        submit to the Congress, not later than March 1, 2005, a 
        written report that contains a request for such 
        extension, together with--
                  (A) a description of all trade agreements 
                that have been negotiated under subsection (b) 
                and the anticipated schedule for submitting 
                such agreements to the Congress for approval;
                  (B) a description of the progress that has 
                been made in negotiations to achieve the 
                purposes, policies, priorities, and objectives 
                of this title, and a statement that such 
                progress justifies the continuation of 
                negotiations; and
                  (C) a statement of the reasons why the 
                extension is needed to complete the 
                negotiations.
          (3) Report to congress by the advisory committee.--
        The President shall promptly inform the Advisory 
        Committee for Trade Policy and Negotiations established 
        under section 135 of the Trade Act of 1974 (19 U.S.C. 
        2155) of the President's decision to submit a report to 
        the Congress under paragraph (2). The Advisory 
        Committee shall submit to the Congress as soon as 
        practicable, but not later than May 1, 2005, a written 
        report that contains--
                  (A) its views regarding the progress that has 
                been made in negotiations to achieve the 
                purposes, policies, priorities, and objectives 
                of this title; and
                  (B) a statement of its views, and the reasons 
                therefor, regarding whether the extension 
                requested under paragraph (2) should be 
                approved or disapproved.
          (4) Status of reports.--The reports submitted to the 
        Congress under paragraphs (2) and (3), or any portion 
        of such reports, may be classified to the extent the 
        President determines appropriate.
          (5) Extension disapproval resolutions.--(A) For 
        purposes of paragraph (1), the term ``extension 
        disapproval resolution'' means a resolution of either 
        House of the Congress, the sole matter after the 
        resolving clause of which is as follows: ``That the 
        ____ disapproves the request of the President for the 
        extension, under section 2103(c)(1)(B)(i) of the 
        Bipartisan Trade Promotion Authority Act of 2002, of 
        the trade authorities procedures under that Act to any 
        implementing bill submitted with respect to any trade 
        agreement entered into under section 2103(b) of that 
        Act after June 30, 2005.'', with the blank space being 
        filled with the name of the resolving House of the 
        Congress.
          (B) Extension disapproval resolutions--
                  (i) may be introduced in either House of the 
                Congress by any member of such House; and
                  (ii) shall be referred, in the House of 
                Representatives, to the Committee on Ways and 
                Means and, in addition, to the Committee on 
                Rules.
          (C) The provisions of section 152(d) and (e) of the 
        Trade Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating 
        to the floor consideration of certain resolutions in 
        the House and Senate) apply to extension disapproval 
        resolutions.
          (D) It is not in order for--
                  (i) the Senate to consider any extension 
                disapproval resolution not reported by the 
                Committee on Finance;
                  (ii) the House of Representatives to consider 
                any extension disapproval resolution not 
                reported by the Committee on Ways and Means 
                and, in addition, by the Committee on Rules; or
                  (iii) either House of the Congress to 
                consider an extension disapproval resolution 
                after June 30, 2005.
  (d) Commencement of Negotiations.--In order to contribute to 
the continued economic expansion of the United States, the 
President shall commence negotiations covering tariff and 
nontariff barriers affecting any industry, product, or service 
sector, and expand existing sectoral agreements to countries 
that are not parties to those agreements, in cases where the 
President determines that such negotiations are feasible and 
timely and would benefit the United States. Such sectors 
include agriculture, commercial services, intellectual property 
rights, industrial and capital goods, government procurement, 
information technology products, environmental technology and 
services, medical equipment and services, civil aircraft, and 
infrastructure products. In so doing, the President shall take 
into account all of the principal negotiating objectives set 
forth in section 2102(b).

SEC. 2104. CONSULTATIONS AND ASSESSMENT.

  (a) Notice and Consultation Before Negotiation.--The 
President, with respect to any agreement that is subject to the 
provisions of section 2103(b), shall--
          (1) provide, at least 90 calendar days before 
        initiating negotiations, written notice to the Congress 
        of the President's intention to enter into the 
        negotiations and set forth therein the date the 
        President intends to initiate such negotiations, the 
        specific United States objectives for the negotiations, 
        and whether the President intends to seek an agreement, 
        or changes to an existing agreement;
          (2) before and after submission of the notice, 
        consult regarding the negotiations with the Committee 
        on Finance of the Senate and the Committee on Ways and 
        Means of the House of Representatives, such other 
        committees of the House and Senate as the President 
        deems appropriate, and the Congressional Oversight 
        group convened under section 2107; and
          (3) upon the request of a majority of the members of 
        the Congressional Oversight Group under section 
        2107(c), meet with the Congressional Oversight Group 
        before initiating the negotiations or at any other time 
        concerning the negotiations.
  (b) Negotiations Regarding Agriculture.--
          (1) In general.--Before initiating or continuing 
        negotiations the subject matter of which is directly 
        related to the subject matter under section 
        2102(b)(10)(A)(i) with any country, the President shall 
        assess whether United States tariffs on agricultural 
        products that were bound under the Uruguay Round 
        Agreements are lower than the tariffs bound by that 
        country. In addition, the President shall consider 
        whether the tariff levels bound and applied throughout 
        the world with respect to imports from the United 
        States are higher than United States tariffs and 
        whether the negotiation provides an opportunity to 
        address any such disparity. The President shall consult 
        with the Committee on Ways and Means and the Committee 
        on Agriculture of the House of Representatives and the 
        Committee on Finance and the Committee on Agriculture, 
        Nutrition, and Forestry of the Senate concerning the 
        results of the assessment, whether it is appropriate 
        for the United States to agree to further tariff 
        reductions based on the conclusions reached in the 
        assessment, and how all applicable negotiating 
        objectives will be met.
          (2) Special consultations on import sensitive 
        products.--(A) Before initiating negotiations with 
        regard to agriculture, and, with respect to the Free 
        Trade Area for the Americas and negotiations with 
        regard to agriculture under the auspices of the World 
        Trade Organization, as soon as practicable after the 
        enactment of this Act, the United States Trade 
        Representative shall--
                  (i) identify those agricultural products 
                subject to tariff reductions by the United 
                States as a result of the Uruguay Round 
                Agreements, for which the rate of duty was 
                reduced on January 1, 1995, to a rate which was 
                not less than 97.5 percent of the rate of duty 
                that applied to such article on December 31, 
                1994;
                  (ii) consult with the Committee on Ways and 
                Means and the Committee on Agriculture of the 
                House of Representatives and the Committee on 
                Finance and the Committee on Agriculture, 
                Nutrition, and Forestry of the Senate 
                concerning--
                          (I) whether any further tariff 
                        reductions on the products identified 
                        under clause (i) should be appropriate, 
                        taking into account the impact of any 
                        such tariff reduction on the United 
                        States industry producing the product 
                        concerned; and
                          (II) whether the products so 
                        identified face unjustified sanitary or 
                        phytosanitary restrictions, including 
                        those not based on scientific 
                        principles in contravention of the 
                        Uruguay Round Agreements;
                  (iii) request that the International Trade 
                Commission prepare an assessment of the 
                probable economic effects of any such tariff 
                reduction on the United States industry 
                producing the product concerned and on the 
                United States economy as a whole; and
                  (iv) upon complying with clauses (i), (ii), 
                and (iii), notify the Committee on Ways and 
                Means and the Committee on Agriculture of the 
                House of Representatives and the Committee on 
                Finance and the Committee on Agriculture, 
                Nutrition, and Forestry of the Senate of those 
                products identified under clause (i) for which 
                the Trade Representative intends to seek tariff 
                liberalization in the negotiations and the 
                reasons for seeking such tariff liberalization.
          (B) If, after negotiations described in subparagraph 
        (A) are commenced--
                  (i) the United States Trade Representative 
                identifies any additional agricultural product 
                described in subparagraph (A)(i) for tariff 
                reductions which were not the subject of a 
                notification under subparagraph (A)(iv), or
                  (ii) any additional agricultural product 
                described in subparagraph (A)(i) is the subject 
                of a request for tariff reductions by a party 
                to the negotiations,
        the Trade Representative shall, as soon as practicable, 
        notify the committees referred to in subparagraph 
        (A)(iv) of those products and the reasons for seeking 
        such tariff reductions.
  (c) Negotiations Regarding Textiles.--Before initiating or 
continuing negotiations the subject matter of which is directly 
related to textiles and apparel products with any country, the 
President shall assess whether United States tariffs on textile 
and apparel products that were bound under the Uruguay Round 
Agreements are lower than the tariffs bound by that country and 
whether the negotiation provides an opportunity to address any 
such disparity. The President shall consult with the Committee 
on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate concerning the results of 
the assessment, whether it is appropriate for the United States 
to agree to further tariff reductions based on the conclusions 
reached in the assessment, and how all applicable negotiating 
objectives will be met.
  (d) Consultation With Congress Before Agreements Entered 
Into.--
          (1) Consultation.--Before entering into any trade 
        agreement under section 2103(b), the President shall 
        consult with--
                  (A) the Committee on Ways and Means of the 
                House of Representatives and the Committee on 
                Finance of the Senate;
                  (B) each other committee of the House and the 
                Senate, and each joint committee of the 
                Congress, which has jurisdiction over 
                legislation involving subject matters which 
                would be affected by the trade agreement; and
                  (C) the Congressional Oversight Group 
                convened under section 2107.
          (2) Scope.--The consultation described in paragraph 
        (1) shall include consultation with respect to--
                  (A) the nature of the agreement;
                  (B) how and to what extent the agreement will 
                achieve the applicable purposes, policies, 
                priorities, and objectives of this title; and
                  (C) the implementation of the agreement under 
                section 2105, including the general effect of 
                the agreement on existing laws.
  (e) Advisory Committee Reports.--The report required under 
section 135(e)(1) of the Trade Act of 1974 regarding any trade 
agreement entered into under section 2103(a) or (b) of this Act 
shall be provided to the President, the Congress, and the 
United States Trade Representative not later than 30 days after 
the date on which the President notifies the Congress under 
section 2103(a)(1) or 2105(a)(1)(A) of the President's 
intention to enter into the agreement.
  (f) ITC Assessment.--
          (1) In general.--The President, at least 90 calendar 
        days before the day on which the President enters into 
        a trade agreement under section 2103(b), shall provide 
        the International Trade Commission (referred to in this 
        subsection as ``the Commission'') with the details of 
        the agreement as it exists at that time and request the 
        Commission to prepare and submit an assessment of the 
        agreement as described in paragraph (2). Between the 
        time the President makes the request under this 
        paragraph and the time the Commission submits the 
        assessment, the President shall keep the Commission 
        current with respect to the details of the agreement.
          (2) ITC assessment.--Not later than 90 calendar days 
        after the President enters into the agreement, the 
        Commission shall submit to the President and the 
        Congress a report assessing the likely impact of the 
        agreement on the United States economy as a whole and 
        on specific industry sectors, including the impact the 
        agreement will have on the gross domestic product, 
        exports and imports, aggregate employment and 
        employment opportunities, the production, employment, 
        and competitive position of industries likely to be 
        significantly affected by the agreement, and the 
        interests of United States consumers.
          (3) Review of empirical literature.--In preparing the 
        assessment, the Commission shall review available 
        economic assessments regarding the agreement, including 
        literature regarding any substantially equivalent 
        proposed agreement, and shall provide in its assessment 
        a description of the analyses used and conclusions 
        drawn in such literature, and a discussion of areas of 
        consensus and divergence between the various analyses 
        and conclusions, including those of the Commission 
        regarding the agreement.

SEC. 2105. IMPLEMENTATION OF TRADE AGREEMENTS.

  (a) In General.--
          (1) Notification and submission.--Any agreement 
        entered into under section 2103(b) shall enter into 
        force with respect to the United States if (and only 
        if)--
                  (A) the President, at least 90 calendar days 
                before the day on which the President enters 
                into the trade agreement, notifies the House of 
                Representatives and the Senate of the 
                President's intention to enter into the 
                agreement, and promptly thereafter publishes 
                notice of such intention in the Federal 
                Register;
                  (B) within 60 days after entering into the 
                agreement, the President submits to the 
                Congress a description of those changes to 
                existing laws that the President considers 
                would be required in order to bring the United 
                States into compliance with the agreement;
                  (C) after entering into the agreement, the 
                President submits to the Congress, on a day on 
                which both Houses of Congress are in session, a 
                copy of the final legal text of the agreement, 
                together with--
                          (i) a draft of an implementing bill 
                        described in section 2103(b)(3);
                          (ii) a statement of any 
                        administrative action proposed to 
                        implement the trade agreement; and
                          (iii) the supporting information 
                        described in paragraph (2); and
                  (D) the implementing bill is enacted into 
                law.
          (2) Supporting information.--The supporting 
        information required under paragraph (1)(C)(iii) 
        consists of--
                  (A) an explanation as to how the implementing 
                bill and proposed administrative action will 
                change or affect existing law; and
                  (B) a statement--
                          (i) asserting that the agreement 
                        makes progress in achieving the 
                        applicable purposes, policies, 
                        priorities, and objectives of this 
                        title; and
                          (ii) setting forth the reasons of the 
                        President regarding--
                                  (I) how and to what extent 
                                the agreement makes progress in 
                                achieving the applicable 
                                purposes, policies, and 
                                objectives referred to in 
                                clause (i);
                                  (II) whether and how the 
                                agreement changes provisions of 
                                an agreement previously 
                                negotiated;
                                  (III) how the agreement 
                                serves the interests of United 
                                States commerce;
                                  (IV) how the implementing 
                                bill meets the standards set 
                                forth in section 2103(b)(3); 
                                and
                                  (V) how and to what extent 
                                the agreement makes progress in 
                                achieving the applicable 
                                purposes, policies, and 
                                objectives referred to in 
                                section 2102(c) regarding the 
                                promotion of certain 
                                priorities.
          (3) Reciprocal benefits.--In order to ensure that a 
        foreign country that is not a party to a trade 
        agreement entered into under section 2103(b) does not 
        receive benefits under the agreement unless the country 
        is also subject to the obligations under the agreement, 
        the implementing bill submitted with respect to the 
        agreement shall provide that the benefits and 
        obligations under the agreement apply only to the 
        parties to the agreement, if such application is 
        consistent with the terms of the agreement. The 
        implementing bill may also provide that the benefits 
        and obligations under the agreement do not apply 
        uniformly to all parties to the agreement, if such 
        application is consistent with the terms of the 
        agreement.
  (b) Limitations on Trade Authorities Procedures.--
          (1) For lack of notice or consultations.--
                  (A) In general.--The trade authorities 
                procedures shall not apply to any implementing 
                bill submitted with respect to a trade 
                agreement or trade agreements entered into 
                under section 2103(b) if during the 60-day 
                period beginning on the date that one House of 
                Congress agrees to a procedural disapproval 
                resolution for lack of notice or consultations 
                with respect to such trade agreement or 
                agreements, the other House separately agrees 
                to a procedural disapproval resolution with 
                respect to such trade agreement or agreements.
                  (B) Procedural disapproval resolution.--(i) 
                For purposes of this paragraph, the term 
                ``procedural disapproval resolution'' means a 
                resolution of either House of Congress, the 
                sole matter after the resolving clause of which 
                is as follows: ``That the President has failed 
                or refused to notify or consult in accordance 
                with the Bipartisan Trade Promotion Authority 
                Act of 2002 on negotiations with respect to 
                ____________ and, therefore, the trade 
                authorities procedures under that Act shall not 
                apply to any implementing bill submitted with 
                respect to such trade agreement or 
                agreements.'', with the blank space being 
                filled with a description of the trade 
                agreement or agreements with respect to which 
                the President is considered to have failed or 
                refused to notify or consult.
                  (ii) For purposes of clause (i), the 
                President has ``failed or refused to notify or 
                consult in accordance with the Bipartisan Trade 
                Promotion Authority Act of 2002'' on 
                negotiations with respect to a trade agreement 
                or trade agreements if--
                          (I) the President has failed or 
                        refused to consult (as the case may be) 
                        in accordance with section 2104 or 2105 
                        with respect to the negotiations, 
                        agreement, or agreements;
                          (II) guidelines under section 2107(b) 
                        have not been developed or met with 
                        respect to the negotiations, agreement, 
                        or agreements;
                          (III) the President has not met with 
                        the Congressional Oversight Group 
                        pursuant to a request made under 
                        section 2107(c) with respect to the 
                        negotiations, agreement, or agreements; 
                        or
                          (IV) the agreement or agreements fail 
                        to make progress in achieving the 
                        purposes, policies, priorities, and 
                        objectives of this title.
          (2) Procedures for considering resolutions.--(A) 
        Procedural disapproval resolutions--
                  (i) in the House of Representatives--
                          (I) may be introduced by any Member 
                        of the House;
                          (II) shall be referred to the 
                        Committee on Ways and Means and, in 
                        addition, to the Committee on Rules; 
                        and
                          (III) may not be amended by either 
                        Committee; and
                  (ii) in the Senate may be introduced by any 
                Member of the Senate.
          (B) The provisions of section 152(d) and (e) of the 
        Trade Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating 
        to the floor consideration of certain resolutions in 
        the House and Senate) apply to a procedural disapproval 
        resolution introduced with respect to a trade agreement 
        if no other procedural disapproval resolution with 
        respect to that trade agreement has previously been 
        considered under such provisions of section 152 of the 
        Trade Act of 1974 in that House of Congress during that 
        Congress.
          (C) It is not in order for the House of 
        Representatives to consider any procedural disapproval 
        resolution not reported by the Committee on Ways and 
        Means and, in addition, by the Committee on Rules.
  (c) Rules of House of Representatives and Senate.--Subsection 
(b) of this section and section 2103(c) are enacted by the 
Congress--
          (1) as an exercise of the rulemaking power of the 
        House of Representatives and the Senate, respectively, 
        and as such are deemed a part of the rules of each 
        House, respectively, and such procedures supersede 
        other rules only to the extent that they are 
        inconsistent with such other rules; and
          (2) with the full recognition of the constitutional 
        right of either House to change the rules (so far as 
        relating to the procedures of that House) at any time, 
        in the same manner, and to the same extent as any other 
        rule of that House.

SEC. 2106. TREATMENT OF CERTAIN TRADE AGREEMENTS FOR WHICH NEGOTIATIONS 
                    HAVE ALREADY BEGUN.

  (a) Certain Agreements.--Notwithstanding section 2103(b)(2), 
if an agreement to which section 2103(b) applies--
          (1) is entered into under the auspices of the World 
        Trade Organization,
          (2) is entered into with Chile,
          (3) is entered into with Singapore, or
          (4) establishes a Free Trade Area for the Americas,
and results from negotiations that were commenced before the 
date of the enactment of this Act, subsection (b) shall apply.
  (b) Treatment of Agreements.--In the case of any agreement to 
which subsection (a) applies--
          (1) the applicability of the trade authorities 
        procedures to implementing bills shall be determined 
        without regard to the requirements of section 2104(a) 
        (relating only to 90 days notice prior to initiating 
        negotiations), and any procedural disapproval 
        resolution under section 2105(b)(1)(B) shall not be in 
        order on the basis of a failure or refusal to comply 
        with the provisions of section 2104(a); and
          (2) the President shall, as soon as feasible after 
        the enactment of this Act--
                  (A) notify the Congress of the negotiations 
                described in subsection (a), the specific 
                United States objectives in the negotiations, 
                and whether the President is seeking a new 
                agreement or changes to an existing agreement; 
                and
                  (B) before and after submission of the 
                notice, consult regarding the negotiations with 
                the committees referred to in section 
                2104(a)(2) and the Congressional Oversight 
                Group.

SEC. 2107. CONGRESSIONAL OVERSIGHT GROUP.

  (a) Members and Functions.--
          (1) In general.--By not later than 60 days after the 
        date of the enactment of this Act, and not later than 
        30 days after the convening of each Congress, the 
        chairman of the Committee on Ways and Means of the 
        House of Representatives and the chairman of the 
        Committee on Finance of the Senate shall convene the 
        Congressional Oversight Group.
          (2) Membership from the house.--In each Congress, the 
        Congressional Oversight Group shall be comprised of the 
        following Members of the House of Representatives:
                  (A) The chairman and ranking member of the 
                Committee on Ways and Means, and 3 additional 
                members of such Committee (not more than 2 of 
                whom are members of the same political party).
                  (B) The chairman and ranking member, or their 
                designees, of the committees of the House of 
                Representatives which would have, under the 
                Rules of the House of Representatives, 
                jurisdiction over provisions of law affected by 
                a trade agreement negotiations for which are 
                conducted at any time during that Congress and 
                to which this title would apply.
          (3) Membership from the senate.--In each Congress, 
        the Congressional Oversight Group shall also be 
        comprised of the following members of the Senate:
                  (A) The chairman and ranking Member of the 
                Committee on Finance and 3 additional members 
                of such Committee (not more than 2 of whom are 
                members of the same political party).
                  (B) The chairman and ranking member, or their 
                designees, of the committees of the Senate 
                which would have, under the Rules of the 
                Senate, jurisdiction over provisions of law 
                affected by a trade agreement negotiations for 
                which are conducted at any time during that 
                Congress and to which this title would apply.
          (4) Accreditation.--Each member of the Congressional 
        Oversight Group described in paragraph (2)(A) and 
        (3)(A) shall be accredited by the United States Trade 
        Representative on behalf of the President as official 
        advisers to the United States delegation in 
        negotiations for any trade agreement to which this 
        title applies. Each member of the Congressional 
        Oversight Group described in paragraph (2)(B) and 
        (3)(B) shall be accredited by the United States Trade 
        Representative on behalf of the President as official 
        advisers to the United States delegation in the 
        negotiations by reason of which the member is in the 
        Congressional Oversight Group. The Congressional 
        Oversight Group shall consult with and provide advice 
        to the Trade Representative regarding the formulation 
        of specific objectives, negotiating strategies and 
        positions, the development of the applicable trade 
        agreement, and compliance and enforcement of the 
        negotiated commitments under the trade agreement.
          (5) Chair.--The Congressional Oversight Group shall 
        be chaired by the Chairman of the Committee on Ways and 
        Means of the House of Representatives and the Chairman 
        of the Committee on Finance of the Senate.
  (b) Guidelines.--
          (1) Purpose and revision.--The United States Trade 
        Representative, in consultation with the chairmen and 
        ranking minority members of the Committee on Ways and 
        Means of the House of Representatives and the Committee 
        on Finance of the Senate--
                  (A) shall, within 120 days after the date of 
                the enactment of this Act, develop written 
                guidelines to facilitate the useful and timely 
                exchange of information between the Trade 
                Representative and the Congressional Oversight 
                Group established under this section; and
                  (B) may make such revisions to the guidelines 
                as may be necessary from time to time.
          (2) Content.--The guidelines developed under 
        paragraph (1) shall provide for, among other things--
                  (A) regular, detailed briefings of the 
                Congressional Oversight Group regarding 
                negotiating objectives, including the promotion 
                of certain priorities referred to in section 
                2102(c), and positions and the status of the 
                applicable negotiations, beginning as soon as 
                practicable after the Congressional Oversight 
                Group is convened, with more frequent briefings 
                as trade negotiations enter the final stage;
                  (B) access by members of the Congressional 
                Oversight Group, and staff with proper security 
                clearances, to pertinent documents relating to 
                the negotiations, including classified 
                materials;
                  (C) the closest practicable coordination 
                between the Trade Representative and the 
                Congressional Oversight Group at all critical 
                periods during the negotiations, including at 
                negotiation sites; and
                  (D) after the applicable trade agreement is 
                concluded, consultation regarding ongoing 
                compliance and enforcement of negotiated 
                commitments under the trade agreement.
  (c) Request for Meeting.--Upon the request of a majority of 
the Congressional Oversight Group, the President shall meet 
with the Congressional Oversight Group before initiating 
negotiations with respect to a trade agreement, or at any other 
time concerning the negotiations.

SEC. 2108. ADDITIONAL IMPLEMENTATION AND ENFORCEMENT REQUIREMENTS.

  (a) In General.--At the time the President submits to the 
Congress the final text of an agreement pursuant to section 
2105(a)(1)(C), the President shall also submit a plan for 
implementing and enforcing the agreement. The implementation 
and enforcement plan shall include the following:
          (1) Border personnel requirements.--A description of 
        additional personnel required at border entry points, 
        including a list of additional customs and agricultural 
        inspectors.
          (2) Agency staffing requirements.--A description of 
        additional personnel required by Federal agencies 
        responsible for monitoring and implementing the trade 
        agreement, including personnel required by the Office 
        of the United States Trade Representative, the 
        Department of Commerce, the Department of Agriculture 
        (including additional personnel required to implement 
        sanitary and phytosanitary measures in order to obtain 
        market access for United States exports), the 
        Department of the Treasury, and such other agencies as 
        may be necessary.
          (3) Customs infrastructure requirements.--A 
        description of the additional equipment and facilities 
        needed by the United States Customs Service.
          (4) Impact on state and local governments.--A 
        description of the impact the trade agreement will have 
        on State and local governments as a result of increases 
        in trade.
          (5) Cost analysis.--An analysis of the costs 
        associated with each of the items listed in paragraphs 
        (1) through (4).
  (b) Budget Submission.--The President shall include a request 
for the resources necessary to support the plan described in 
subsection (a) in the first budget that the President submits 
to the Congress after the submission of the plan.

SEC. 2109. COMMITTEE STAFF.

  The grant of trade promotion authority under this title is 
likely to increase the activities of the primary committees of 
jurisdiction in the area of international trade. In addition, 
the creation of the Congressional Oversight Group under section 
2107 will increase the participation of a broader number of 
Members of Congress in the formulation of United States trade 
policy and oversight of the international trade agenda for the 
United States. The primary committees of jurisdiction should 
have adequate staff to accommodate these increases in 
activities.

SEC. 2110. CONFORMING AMENDMENTS.

  (a) In General.--Title I of the Trade Act of 1974 (19 U.S.C. 
2111 et seq.) is amended as follows:
          (1) Implementing bill.--
                  (A) Section 151(b)(1) (19 U.S.C. 2191(b)(1)) 
                is amended by striking ``section 1103(a)(1) of 
                the Omnibus Trade and Competitiveness Act of 
                1988, or section 282 of the Uruguay Round 
                Agreements Act'' and inserting ``section 282 of 
                the Uruguay Round Agreements Act, or section 
                2105(a)(1) of the Bipartisan Trade Promotion 
                Authority Act of 2002''.
                  (B) Section 151(c)(1) (19 U.S.C. 2191(c)(1)) 
                is amended by striking ``or section 282 of the 
                Uruguay Round Agreements Act'' and inserting 
                ``, section 282 of the Uruguay Round Agreements 
                Act, or section 2105(a)(1) of the Bipartisan 
                Trade Promotion Authority Act of 2002''.
          (2) Advice from international trade commission.--
        Section 131 (19 U.S.C. 2151) is amended--
                  (A) in subsection (a)--
                          (i) in paragraph (1), by striking 
                        ``section 123 of this Act or section 
                        1102 (a) or (c) of the Omnibus Trade 
                        and Competitiveness Act of 1988,'' and 
                        inserting ``section 123 of this Act or 
                        section 2103(a) or (b) of the 
                        Bipartisan Trade Promotion Authority 
                        Act of 2002,''; and
                          (ii) in paragraph (2), by striking 
                        ``section 1102 (b) or (c) of the 
                        Omnibus Trade and Competitiveness Act 
                        of 1988'' and inserting ``section 
                        2103(b) of the Bipartisan Trade 
                        Promotion Authority Act of 2002'';
                  (B) in subsection (b), by striking ``section 
                1102(a)(3)(A)'' and inserting ``section 
                2103(a)(3)(A) of the Bipartisan Trade Promotion 
                Authority Act of 2002''; and
                  (C) in subsection (c), by striking ``section 
                1102 of the Omnibus Trade and Competitiveness 
                Act of 1988,'' and inserting ``section 2103 of 
                the Bipartisan Trade Promotion Authority Act of 
                2002,''.
          (3) Hearings and advice.--Sections 132, 133(a), and 
        134(a) (19 U.S.C. 2152, 2153(a), and 2154(a)) are each 
        amended by striking ``section 1102 of the Omnibus Trade 
        and Competitiveness Act of 1988,'' each place it 
        appears and inserting ``section 2103 of the Bipartisan 
        Trade Promotion Authority Act of 2002,''.
          (4) Prerequisites for offers.--Section 134(b) (19 
        U.S.C. 2154(b)) is amended by striking ``section 1102 
        of the Omnibus Trade and Competitiveness Act of 1988'' 
        and inserting ``section 2103 of the Bipartisan Trade 
        Promotion Authority Act of 2002''.
          (5) Advice from private and public sectors.--Section 
        135 (19 U.S.C. 2155) is amended--
                  (A) in subsection (a)(1)(A), by striking 
                ``section 1102 of the Omnibus Trade and 
                Competitiveness Act of 1988'' and inserting 
                ``section 2103 of the Bipartisan Trade 
                Promotion Authority Act of 2002'';
                  (B) in subsection (e)(1)--
                          (i) by striking ``section 1102 of the 
                        Omnibus Trade and Competitiveness Act 
                        of 1988'' each place it appears and 
                        inserting ``section 2103 of the 
                        Bipartisan Trade Promotion Authority 
                        Act of 2002''; and
                          (ii) by striking ``section 
                        1103(a)(1)(A) of such Act of 1988'' and 
                        inserting ``section 2105(a)(1)(A) of 
                        the Bipartisan Trade Promotion 
                        Authority Act of 2002''; and
                  (C) in subsection (e)(2), by striking 
                ``section 1101 of the Omnibus Trade and 
                Competitiveness Act of 1988'' and inserting 
                ``section 2102 of the Bipartisan Trade 
                Promotion Authority Act of 2002''.
          (6) Transmission of agreements to congress.--Section 
        162(a) (19 U.S.C. 2212(a)) is amended by striking ``or 
        under section 1102 of the Omnibus Trade and 
        Competitiveness Act of 1988'' and inserting ``or under 
        section 2103 of the Bipartisan Trade Promotion 
        Authority Act of 2002''.
  (b) Application of Certain Provisions.--For purposes of 
applying sections 125, 126, and 127 of the Trade Act of 1974 
(19 U.S.C. 2135, 2136(a), and 2137)--
          (1) any trade agreement entered into under section 
        2103 shall be treated as an agreement entered into 
        under section 101 or 102, as appropriate, of the Trade 
        Act of 1974 (19 U.S.C. 2111 or 2112); and
          (2) any proclamation or Executive order issued 
        pursuant to a trade agreement entered into under 
        section 2103 shall be treated as a proclamation or 
        Executive order issued pursuant to a trade agreement 
        entered into under section 102 of the Trade Act of 
        1974.

SEC. 2111. DEFINITIONS.

  In this title:
          (1) Agreement on agriculture.--The term ``Agreement 
        on Agriculture'' means the agreement referred to in 
        section 101(d)(2) of the Uruguay Round Agreements Act 
        (19 U.S.C. 3511(d)(2)).
          (2) Core labor standards.--The term ``core labor 
        standards'' means--
                  (A) the right of association;
                  (B) the right to organize and bargain 
                collectively;
                  (C) a prohibition on the use of any form of 
                forced or compulsory labor;
                  (D) a minimum age for the employment of 
                children; and
                  (E) acceptable conditions of work with 
                respect to minimum wages, hours of work, and 
                occupational safety and health.
          (3) GATT 1994.--The term ``GATT 1994'' has the 
        meaning given that term in section 2 of the Uruguay 
        Round Agreements Act (19 U.S.C. 3501).
          (4) ILO.--The term ``ILO'' means the International 
        Labor Organization.
          (5) United states person.--The term ``United States 
        person'' means--
                  (A) a United States citizen;
                  (B) a partnership, corporation, or other 
                legal entity organized under the laws of the 
                United States; and
                  (C) a partnership, corporation, or other 
                legal entity that is organized under the laws 
                of a foreign country and is controlled by 
                entities described in subparagraph (B) or 
                United States citizens, or both.
          (6) Uruguay round agreements.--The term ``Uruguay 
        Round Agreements'' has the meaning given that term in 
        section 2(7) of the Uruguay Round Agreements Act (19 
        U.S.C. 3501(7)).
          (7) World trade organization; wto.--The terms ``World 
        Trade Organization'' and ``WTO'' mean the organization 
        established pursuant to the WTO Agreement.
          (8) WTO agreement.--The term ``WTO Agreement'' means 
        the Agreement Establishing the World Trade Organization 
        entered into on April 15, 1994.
          (9) WTO member.--The term ``WTO member'' has the 
        meaning given that term in section 2(10) of the Uruguay 
        Round Agreements Act (19 U.S.C. 3501(10)).
          (10) Other definitions.--
                  (A) Agreement on subsidies and countervailing 
                measures.--The term ``Agreement on Subsidies 
                and Countervailing Measures'' means the 
                agreement referred to in section 101(d)(12) of 
                the Uruguay Round Agreements Act (19 U.S.C. 
                3511(d)(12)).
                  (B) Antidumping agreement.--The term 
                ``Antidumping Agreement`` means the Agreement 
                on Implementation of Article VI of the General 
                Agreement on Tariffs and Trade 1994 referred to 
                in section 101(d)(7) of the Uruguay Round 
                Agreements Act (19 U.S.C. 3511(d)(7)).

                DIVISION C--ANDEAN TRADE PREFERENCE ACT

                  TITLE XXXI--ANDEAN TRADE PREFERENCE

SEC. 3101. SHORT TITLE.

  This title may be cited as the ``Andean Trade Promotion and 
Drug Eradication Act''.

SEC. 3102. FINDINGS.

  Congress makes the following findings:
          (1) Since the Andean Trade Preference Act was enacted 
        in 1991, it has had a positive impact on United States 
        trade with Bolivia, Colombia, Ecuador, and Peru. Two-
        way trade has doubled, with the United States serving 
        as the leading source of imports and leading export 
        market for each of the Andean beneficiary countries. 
        This has resulted in increased jobs and expanded export 
        opportunities in both the United States and the Andean 
        region.
          (2) The Andean Trade Preference Act has been a key 
        element in the United States counternarcotics strategy 
        in the Andean region, promoting export diversification 
        and broad-based economic development that provides 
        sustainable economic alternatives to drug-crop 
        production, strengthening the legitimate economies of 
        Andean countries and creating viable alternatives to 
        illicit trade in coca.
          (3) Notwithstanding the success of the Andean Trade 
        Preference Act, the Andean region remains threatened by 
        political and economic instability and fragility, 
        vulnerable to the consequences of the drug war and 
        fierce global competition for its legitimate trade.
          (4) The continuing instability in the Andean region 
        poses a threat to the security interests of the United 
        States and the world. This problem has been partially 
        addressed through foreign aid, such as Plan Colombia, 
        enacted by Congress in 2000. However, foreign aid alone 
        is not sufficient. Enhancement of legitimate trade with 
        the United States provides an alternative means for 
        reviving and stabilizing the economies in the Andean 
        region.
          (5) The Andean Trade Preference Act constitutes a 
        tangible commitment by the United States to the 
        promotion of prosperity, stability, and democracy in 
        the beneficiary countries.
          (6) Renewal and enhancement of the Andean Trade 
        Preference Act will bolster the confidence of domestic 
        private enterprise and foreign investors in the 
        economic prospects of the region, ensuring that 
        legitimate private enterprise can be the engine of 
        economic development and political stability in the 
        region.
          (7) Each of the Andean beneficiary countries is 
        committed to conclude negotiation of a Free Trade Area 
        of the Americas by the year 2005, as a means of 
        enhancing the economic security of the region.
          (8) Temporarily enhancing trade benefits for Andean 
        beneficiary countries will promote the growth of free 
        enterprise and economic opportunity in these countries 
        and serve the security interests of the United States, 
        the region, and the world.

SEC. 3103. ARTICLES ELIGIBLE FOR PREFERENTIAL TREATMENT.

  (a) Eligibility of Certain Articles.--Section 204 of the 
Andean Trade Preference Act (19 U.S.C. 3203) is amended--
          (1) by striking subsection (c) and redesignating 
        subsections (d) through (g) as subsections (c) through 
        (f), respectively; and
          (2) by amending subsection (b) to read as follows:
  ``(b) Exceptions and Special Rules.--
          ``(1) Certain articles that are not import-
        sensitive.--The President may proclaim duty-free 
        treatment under this title for any article described in 
        subparagraph (A), (B), (C), or (D) that is the growth, 
        product, or manufacture of an ATPDEA beneficiary 
        country and that meets the requirements of this 
        section, if the President determines that such article 
        is not import-sensitive in the context of imports from 
        ATPDEA beneficiary countries:
                  ``(A) Footwear not designated at the time of 
                the effective date of this Act as eligible for 
                the purpose of the generalized system of 
                preferences under title V of the Trade Act of 
                1974.
                  ``(B) Petroleum, or any product derived from 
                petroleum, provided for in headings 2709 and 
                2710 of the HTS.
                  ``(C) Watches and watch parts (including 
                cases, bracelets and straps), of whatever type 
                including, but not limited to, mechanical, 
                quartz digital or quartz analog, if such 
                watches or watch parts contain any material 
                which is the product of any country with 
                respect to which HTS column 2 rates of duty 
                apply.
                  ``(D) Handbags, luggage, flat goods, work 
                gloves, and leather wearing apparel that were 
                not designated on August 5, 1983, as eligible 
                articles for purposes of the generalized system 
                of preferences under title V of the Trade Act 
                of 1974.
          ``(2) Exclusions.--Subject to paragraph (3), duty-
        free treatment under this title may not be extended 
        to--
                  ``(A) textiles and apparel articles which 
                were not eligible articles for purposes of this 
                title on January 1, 1994, as this title was in 
                effect on that date;
                  ``(B) rum and tafia classified in subheading 
                2208.40 of the HTS; or
                  ``(C) sugars, syrups, and sugar-containing 
                products subject to over-quota duty rates under 
                applicable tariff-rate quotas.
          ``(3) Apparel articles.--
                  ``(A) In general.--Apparel articles that are 
                imported directly into the customs territory of 
                the United States from an ATPDEA beneficiary 
                country shall enter the United States free of 
                duty and free of any quantitative restrictions, 
                limitations, or consultation levels, but only 
                if such articles are described in subparagraph 
                (B).
                  ``(B) Covered articles.--The apparel articles 
                referred to in subparagraph (A) are the 
                following:
                          ``(i) Apparel articles assembled from 
                        products of the united states and 
                        atpdea beneficiary countries or 
                        products not available in commercial 
                        quantities.--Apparel articles sewn or 
                        otherwise assembled in 1 or more ATPDEA 
                        beneficiary countries, or the United 
                        States, or both, exclusively from any 
                        one or any combination of the 
                        following:
                                  ``(I) Fabrics or fabric 
                                components formed, or 
                                components knit-to-shape, in 
                                the United States, from yarns 
                                formed in the United States or 
                                1 or more ATPDEA beneficiary 
                                countries (including fabrics 
                                not formed from yarns, if such 
                                fabrics are classifiable under 
                                heading 5602 or 5603 of the HTS 
                                and are formed in the United 
                                States). Apparel articles shall 
                                qualify under this subclause 
                                only if all dyeing, printing, 
                                and finishing of the fabrics 
                                from which the articles are 
                                assembled, if the fabrics are 
                                knit fabrics, is carried out in 
                                the United States. Apparel 
                                articles shall qualify under 
                                this subclause only if all 
                                dyeing, printing, and finishing 
                                of the fabrics from which the 
                                articles are assembled, if the 
                                fabrics are woven fabrics, is 
                                carried out in the United 
                                States.
                                  ``(II) Fabrics or fabric 
                                components formed or components 
                                knit-to-shape, in 1 or more 
                                ATPDEA beneficiary countries, 
                                from yarns formed in 1 or more 
                                ATPDEA beneficiary countries, 
                                if such fabrics (including 
                                fabrics not formed from yarns, 
                                if such fabrics are 
                                classifiable under heading 5602 
                                or 5603 of the HTS and are 
                                formed in 1 or more ATPDEA 
                                beneficiary countries) or 
                                components are in chief weight 
                                of llama or alpaca.
                                  ``(III) Fabrics or yarn that 
                                is not formed in the United 
                                States or in one or more ATPDEA 
                                beneficiary countries, to the 
                                extent that apparel articles of 
                                such fabrics or yarn would be 
                                eligible for preferential 
                                treatment, without regard to 
                                the source of the fabrics or 
                                yarn, under Annex 401 of the 
                                NAFTA.
                          ``(ii) Additional fabrics.--At the 
                        request of any interested party, the 
                        President is authorized to proclaim 
                        additional fabrics and yarns as 
                        eligible for preferential treatment 
                        under clause (i)(III) if--
                                  ``(I) the President 
                                determines that such fabrics or 
                                yarns cannot be supplied by the 
                                domestic industry in commercial 
                                quantities in a timely manner;
                                  ``(II) the President has 
                                obtained advice regarding the 
                                proposed action from the 
                                appropriate advisory committee 
                                established under section 135 
                                of the Trade Act of 1974 (19 
                                U.S.C. 2155) and the United 
                                States International Trade 
                                Commission;
                                  ``(III) within 60 days after 
                                the request, the President has 
                                submitted a report to the 
                                Committee on Ways and Means of 
                                the House of Representatives 
                                and the Committee on Finance of 
                                the Senate that sets forth the 
                                action proposed to be 
                                proclaimed and the reasons for 
                                such action, and the advice 
                                obtained under subclause (II);
                                  ``(IV) a period of 60 
                                calendar days, beginning with 
                                the first day on which the 
                                President has met the 
                                requirements of subclause 
                                (III), has expired; and
                                  ``(V) the President has 
                                consulted with such committees 
                                regarding the proposed action 
                                during the period referred to 
                                in subclause (III).
                          ``(iii) Apparel articles assembled in 
                        1 or more atpdea beneficiary countries 
                        from regional fabrics or regional 
                        components.--(I) Subject to the 
                        limitation set forth in subclause (II), 
                        apparel articles sewn or otherwise 
                        assembled in 1 or more ATPDEA 
                        beneficiary countries from fabrics or 
                        from fabric components formed or from 
                        components knit-to-shape, in 1 or more 
                        ATPDEA beneficiary countries, from 
                        yarns formed in the United States or 1 
                        or more ATPDEA beneficiary countries 
                        (including fabrics not formed from 
                        yarns, if such fabrics are classifiable 
                        under heading 5602 or 5603 of the HTS 
                        and are formed in 1 or more ATPDEA 
                        beneficiary countries), whether or not 
                        the apparel articles are also made from 
                        any of the fabrics, fabric components 
                        formed, or components knit-to-shape 
                        described in clause (i).
                          ``(II) The preferential treatment 
                        referred to in subclause (I) shall be 
                        extended in the 1-year period beginning 
                        December 1, 2001, and in each of the 5 
                        succeeding 1-year periods, to imports 
                        of apparel articles in an amount not to 
                        exceed the applicable percentage of the 
                        aggregate square meter equivalents of 
                        all apparel articles imported into the 
                        United States in the preceding 12-month 
                        period for which data are available.
                          ``(III) For purposes of subclause 
                        (II), the term `applicable percentage' 
                        means 3 percent for the 1-year period 
                        beginning December 1, 2001, increased 
                        in each of the 5 succeeding 1-year 
                        periods by equal increments, so that 
                        for the period beginning December 1, 
                        2005, the applicable percentage does 
                        not exceed 6 percent.
                          ``(iv) Handloomed, handmade, and 
                        folklore articles.--A handloomed, 
                        handmade, or folklore article of an 
                        ATPDEA beneficiary country identified 
                        under subparagraph (C) that is 
                        certified as such by the competent 
                        authority of such beneficiary country.
                          ``(v) Special rules.--
                                  ``(I) Exception for findings 
                                and trimmings.--An article 
                                otherwise eligible for 
                                preferential treatment under 
                                this paragraph shall not be 
                                ineligible for such treatment 
                                because the article contains 
                                findings or trimmings of 
                                foreign origin, if such 
                                findings and trimmings do not 
                                exceed 25 percent of the cost 
                                of the components of the 
                                assembled product. Examples of 
                                findings and trimmings are 
                                sewing thread, hooks and eyes, 
                                snaps, buttons, `bow buds', 
                                decorative lace, trim, elastic 
                                strips, zippers, including 
                                zipper tapes and labels, and 
                                other similar products.
                                  ``(II) Certain interlining.--
                                (aa) An article otherwise 
                                eligible for preferential 
                                treatment under this paragraph 
                                shall not be ineligible for 
                                such treatment because the 
                                article contains certain 
                                interlinings of foreign origin, 
                                if the value of such 
                                interlinings (and any findings 
                                and trimmings) does not exceed 
                                25 percent of the cost of the 
                                components of the assembled 
                                article.
                                  ``(bb) Interlinings eligible 
                                for the treatment described in 
                                division (aa) include only a 
                                chest type plate, `hymo' piece, 
                                or `sleeve header', of woven or 
                                weft-inserted warp knit 
                                construction and of coarse 
                                animal hair or man-made 
                                filaments.
                                  ``(cc) The treatment 
                                described in this subclause 
                                shall terminate if the 
                                President makes a determination 
                                that United States 
                                manufacturers are producing 
                                such interlinings in the United 
                                States in commercial 
                                quantities.
                                  ``(III) De minimis rule.--An 
                                article that would otherwise be 
                                ineligible for preferential 
                                treatment under this 
                                subparagraph because the 
                                article contains fibers or 
                                yarns not wholly formed in the 
                                United States or in one or more 
                                ATPDEA beneficiary countries 
                                shall not be ineligible for 
                                such treatment if the total 
                                weight of all such fibers or 
                                yarns is not more than 7 
                                percent of the total weight of 
                                the good.
                  ``(C) Handloomed, handmade, and folklore 
                articles.--For purposes of subparagraph 
                (B)(iv), the President shall consult with 
                representatives of the ATPDEA beneficiary 
                countries concerned for the purpose of 
                identifying particular textile and apparel 
                goods that are mutually agreed upon as being 
                handloomed, handmade, or folklore goods of a 
                kind described in section 2.3(a), (b), or (c) 
                of the Annex or Appendix 3.1.B.11 of the Annex.
                  ``(D) Penalties for transshipment.--
                          ``(i) Penalties for exporters.--If 
                        the President determines, based on 
                        sufficient evidence, that an exporter 
                        has engaged in transshipment with 
                        respect to apparel articles from an 
                        ATPDEA beneficiary country, then the 
                        President shall deny all benefits under 
                        this title to such exporter, and any 
                        successor of such exporter, for a 
                        period of 2 years.
                          ``(ii) Penalties for countries.--
                        Whenever the President finds, based on 
                        sufficient evidence, that transshipment 
                        has occurred, the President shall 
                        request that the ATPDEA beneficiary 
                        country or countries through whose 
                        territory the transshipment has 
                        occurred take all necessary and 
                        appropriate actions to prevent such 
                        transshipment. If the President 
                        determines that a country is not taking 
                        such actions, the President shall 
                        reduce the quantities of apparel 
                        articles that may be imported into the 
                        United States from such country by the 
                        quantity of the transshipped articles 
                        multiplied by 3, to the extent 
                        consistent with the obligations of the 
                        United States under the WTO.
                          ``(iii) Transshipment described.--
                        Transshipment within the meaning of 
                        this subparagraph has occurred when 
                        preferential treatment under 
                        subparagraph (A) has been claimed for 
                        an apparel article on the basis of 
                        material false information concerning 
                        the country of origin, manufacture, 
                        processing, or assembly of the article 
                        or any of its components. For purposes 
                        of this clause, false information is 
                        material if disclosure of the true 
                        information would mean or would have 
                        meant that the article is or was 
                        ineligible for preferential treatment 
                        under subparagraph (A).
                  ``(E) Bilateral emergency actions.--
                          ``(i) In general.--The President may 
                        take bilateral emergency tariff actions 
                        of a kind described in section 4 of the 
                        Annex with respect to any apparel 
                        article imported from an ATPDEA 
                        beneficiary country if the application 
                        of tariff treatment under subparagraph 
                        (A) to such article results in 
                        conditions that would be cause for the 
                        taking of such actions under such 
                        section 4 with respect to a like 
                        article described in the same 8-digit 
                        subheading of the HTS that is imported 
                        from Mexico.
                          ``(ii) Rules relating to bilateral 
                        emergency action.--For purposes of 
                        applying bilateral emergency action 
                        under this subparagraph--
                                  ``(I) the requirements of 
                                paragraph (5) of section 4 of 
                                the Annex (relating to 
                                providing compensation) shall 
                                not apply;
                                  ``(II) the term `transition 
                                period' in section 4 of the 
                                Annex shall mean the period 
                                ending December 31, 2006; and
                                  ``(III) the requirements to 
                                consult specified in section 4 
                                of the Annex shall be treated 
                                as satisfied if the President 
                                requests consultations with the 
                                ATPDEA beneficiary country in 
                                question and the country does 
                                not agree to consult within the 
                                time period specified under 
                                section 4.
          ``(4) Customs procedures.--
                  ``(A) In general.--
                          ``(i) Regulations.--Any importer that 
                        claims preferential treatment under 
                        paragraph (1) or (3) shall comply with 
                        customs procedures similar in all 
                        material respects to the requirements 
                        of Article 502(1) of the NAFTA as 
                        implemented pursuant to United States 
                        law, in accordance with regulations 
                        promulgated by the Secretary of the 
                        Treasury.
                          ``(ii) Determination.--
                                  ``(I) In general.--In order 
                                to qualify for the preferential 
                                treatment under paragraph (1) 
                                or (3) and for a Certificate of 
                                Origin to be valid with respect 
                                to any article for which such 
                                treatment is claimed, there 
                                shall be in effect a 
                                determination by the President 
                                that each country described in 
                                subclause (II)--
                                          ``(aa) has 
                                        implemented and 
                                        follows; or
                                          ``(bb) is making 
                                        substantial progress 
                                        toward implementing and 
                                        following,
                                procedures and requirements 
                                similar in all material 
                                respects to the relevant 
                                procedures and requirements 
                                under chapter 5 of the NAFTA.
                                  ``(II) Country described.--A 
                                country is described in this 
                                subclause if it is an ATPDEA 
                                beneficiary country--
                                          ``(aa) from which the 
                                        article is exported; or
                                          ``(bb) in which 
                                        materials used in the 
                                        production of the 
                                        article originate or in 
                                        which the article or 
                                        such materials undergo 
                                        production that 
                                        contributes to a claim 
                                        that the article is 
                                        eligible for 
                                        preferential treatment 
                                        under paragraph (1) or 
                                        (3).
                  ``(B) Certificate of origin.--The Certificate 
                of Origin that otherwise would be required 
                pursuant to the provisions of subparagraph (A) 
                shall not be required in the case of an article 
                imported under paragraph (1) or (3) if such 
                Certificate of Origin would not be required 
                under Article 503 of the NAFTA (as implemented 
                pursuant to United States law), if the article 
                were imported from Mexico.
          ``(5) Definitions.--In this subsection--
                  ``(A) Annex.--The term `the Annex' means 
                Annex 300-B of the NAFTA.
                  ``(B) ATPDEA beneficiary country.--The term 
                `ATPDEA beneficiary country' means any 
                `beneficiary country', as defined in section 
                203(a)(1) of this title, which the President 
                designates as an ATPDEA beneficiary country, 
                taking into account the criteria contained in 
                subsections (c) and (d) of section 203 and 
                other appropriate criteria, including the 
                following:
                          ``(i) Whether the beneficiary country 
                        has demonstrated a commitment to--
                                  ``(I) undertake its 
                                obligations under the WTO, 
                                including those agreements 
                                listed in section 101(d) of the 
                                Uruguay Round Agreements Act, 
                                on or ahead of schedule; and
                                  ``(II) participate in 
                                negotiations toward the 
                                completion of the FTAA or 
                                another free trade agreement.
                          ``(ii) The extent to which the 
                        country provides protection of 
                        intellectual property rights consistent 
                        with or greater than the protection 
                        afforded under the Agreement on Trade-
                        Related Aspects of Intellectual 
                        Property Rights described in section 
                        101(d)(15) of the Uruguay Round 
                        Agreements Act.
                          ``(iii) The extent to which the 
                        country provides internationally 
                        recognized worker rights, including--
                                  ``(I) the right of 
                                association;
                                  ``(II) the right to organize 
                                and bargain collectively;
                                  ``(III) a prohibition on the 
                                use of any form of forced or 
                                compulsory labor;
                                  ``(IV) a minimum age for the 
                                employment of children; and
                                  ``(V) acceptable conditions 
                                of work with respect to minimum 
                                wages, hours of work, and 
                                occupational safety and health;
                          ``(iv) Whether the country has 
                        implemented its commitments to 
                        eliminate the worst forms of child 
                        labor, as defined in section 507(6) of 
                        the Trade Act of 1974.
                          ``(v) The extent to which the country 
                        has met the counternarcotics 
                        certification criteria set forth in 
                        section 490 of the Foreign Assistance 
                        Act of 1961 (22 U.S.C. 2291j) for 
                        eligibility for United States 
                        assistance.
                          ``(vi) The extent to which the 
                        country has taken steps to become a 
                        party to and implements the Inter-
                        American Convention Against Corruption.
                          ``(vii) The extent to which the 
                        country--
                                  ``(I) applies transparent, 
                                nondiscriminatory, and 
                                competitive procedures in 
                                government procurement 
                                equivalent to those contained 
                                in the Agreement on Government 
                                Procurement described in 
                                section 101(d)(17) of the 
                                Uruguay Round Agreements Act; 
                                and
                                  ``(II) contributes to efforts 
                                in international fora to 
                                develop and implement 
                                international rules in 
                                transparency in government 
                                procurement.
                  ``(C) NAFTA.--The term `NAFTA' means the 
                North American Free Trade Agreement entered 
                into between the United States, Mexico, and 
                Canada on December 17, 1992.
                  ``(D) WTO.--The term `WTO' has the meaning 
                given that term in section 2 of the Uruguay 
                Round Agreements Act (19 U.S.C. 3501).
                  ``(E) ATPDEA.--The term `ATPDEA' means the 
                Andean Trade Promotion and Drug Eradication 
                Act.''.
  (b) Determination Regarding Retention of Designation.--
Section 203(e)(1) of the Andean Trade Preference Act (19 U.S.C. 
3202(e)(1)) is amended--
          (1) by redesignating subparagraphs (A) and (B) as 
        clauses (i) and (ii), respectively;
          (2) by inserting ``(A)'' after ``(1)''; and
          (3) by adding at the end the following:
  ``(B) The President may, after the requirements of paragraph 
(2) have been met--
          ``(i) withdraw or suspend the designation of any 
        country as an ATPDEA beneficiary country, or
          ``(ii) withdraw, suspend, or limit the application of 
        preferential treatment under section 204(b)(1) or (3) 
        to any article of any country,
if, after such designation, the President determines that, as a 
result of changed circumstances, the performance of such 
country is not satisfactory under the criteria set forth in 
section 204(b)(5)(B).''.
  (c) Conforming Amendments.--(1) Section 202 of the Andean 
Trade Preference Act (19 U.S.C. 3201) is amended by inserting 
``(or other preferential treatment)'' after ``treatment''.
  (2) Section 204(a) of the Andean Trade Preference Act (19 
U.S.C. 3203(a)) is amended--
          (A) in paragraph (1), by inserting ``(or otherwise 
        provided for)'' after ``eligibility''; and
          (B) in paragraph (2), by striking ``subsection (a)'' 
        and inserting ``paragraph (1)''.

SEC. 3104. TERMINATION OF PREFERENTIAL TREATMENT.

  Section 208 of the Andean Trade Preference Act (19 U.S.C. 
3206) is amended to read as follows:

``SEC. 208. TERMINATION OF PREFERENTIAL TREATMENT.

  ``No duty-free treatment or other preferential treatment 
extended to beneficiary countries under this title shall remain 
in effect after December 31, 2006.''.

SEC. 3105. TRADE BENEFITS UNDER THE CARIBBEAN BASIN ECONOMIC RECOVERY 
                    ACT.

  Section 213(b)(2)(A) of the Carribean Basin Economic Recovery 
Act (19 U.S.C. 2703(b)(2)(A)) is amended as follows:
          (1) Clause (i) is amended--
                  (A) by striking the matter preceding 
                subclause (I) and inserting the following:
                          ``(i) Apparel articles assembled in 
                        one or more cbtpa beneficiary 
                        countries.--Apparel articles sewn or 
                        otherwise assembled in one or more 
                        CBTPA beneficiary countries from 
                        fabrics wholly formed and cut, or from 
                        components knit-to-shape, in the United 
                        States from yarns wholly formed in the 
                        United States, (including fabrics not 
                        formed from yarns, if such fabrics are 
                        classifiable under heading 5602 or 5603 
                        of the HTS and are wholly formed and 
                        cut in the United States) that are--''; 
                        and
                  (B) by adding at the end the following:
                        ``Apparel articles shall qualify under 
                        the preceding sentence only if all 
                        dyeing, printing, and finishing of the 
                        fabrics from which the articles are 
                        assembled, if the fabrics are knit 
                        fabrics, is carried out in the United 
                        States. Apparel articles shall qualify 
                        under the first sentence of this clause 
                        only if all dyeing, printing, and 
                        finishing of the fabrics from which the 
                        articles are assembled, if the fabrics 
                        are woven fabrics, is carried out in 
                        the United States.''.
          (2) Clause (ii) is amended to read as follows:
                          ``(ii) Other apparel articles 
                        assembled in one or more cbtpa 
                        beneficiary countries.--Apparel 
                        articles sewn or otherwise assembled in 
                        one or more CBTPA beneficiary countries 
                        with thread formed in the United States 
                        from fabrics wholly formed in the 
                        United States and cut in one or more 
                        CBTPA beneficiary countries from yarns 
                        wholly formed in the United States, or 
                        from components knit-to-shape in the 
                        United States from yarns wholly formed 
                        in the United States, or both 
                        (including fabrics not formed from 
                        yarns, if such fabrics are classifiable 
                        under heading 5602 or 5603 of the HTS 
                        and are wholly formed in the United 
                        States). Apparel articles shall qualify 
                        under the preceding sentence only if 
                        all dyeing, printing, and finishing of 
                        the fabrics from which the articles are 
                        assembled, if the fabrics are knit 
                        fabrics, is carried out in the United 
                        States. Apparel articles shall qualify 
                        under the first sentence of this clause 
                        only if all dyeing, printing, and 
                        finishing of the fabrics from which the 
                        articles are assembled, if the fabrics 
                        are woven fabrics, is carried out in 
                        the United States.''.
          (3) Clause (iii)(II) is amended to read as follows:
                          ``(II) The amount referred to in 
                        subclause (I) is as follows:
                                  ``(aa) 290,000,000 square 
                                meter equivalents during the 1-
                                year period beginning on 
                                October 1, 2001.
                                  ``(bb) 500,000,000 square 
                                meter equivalents during the 1-
                                year period beginning on 
                                October 1, 2002.
                                  ``(cc) 850,000,000 square 
                                meter equivalents during the 1-
                                year period beginning on 
                                October 1, 2003.
                                  ``(dd) 970,000,000 square 
                                meter equivalents in each 
                                succeeding 1-year period 
                                through September 30, 2008.''.
          (4) Clause (iii)(IV) is amended to read as follows:
                          ``(IV) The amount referred to in 
                        subclause (III) is as follows:
                                  ``(aa) 4,872,000 dozen during 
                                the 1-year period beginning on 
                                October 1, 2001.
                                  ``(bb) 9,000,000 dozen during 
                                the 1-year period beginning on 
                                October 1, 2002.
                                  ``(cc) 10,000,000 dozen 
                                during the 1-year period 
                                beginning on October 1, 2003.
                                  ``(dd) 12,000,000 dozen in 
                                each succeeding 1-year period 
                                through September 30, 2008.''.
          (5) Section 213(b)(2)(A) of such Act is further 
        amended by adding at the end the following new clause:
                          ``(ix) Apparel articles assembled in 
                        one or more cbtpa beneficiary countries 
                        from united states and cbtpa 
                        beneficiary country components.--
                        Apparel articles sewn or otherwise 
                        assembled in one or more CBTPA 
                        beneficiary countries with thread 
                        formed in the United States from 
                        components cut in the United States and 
                        in one or more CBTPA beneficiary 
                        countries from fabric wholly formed in 
                        the United States from yarns wholly 
                        formed in the United States, or from 
                        components knit-to-shape in the United 
                        States and one or more CBTPA 
                        beneficiary countries from yarns wholly 
                        formed in the United States, or both 
                        (including fabrics not formed from 
                        yarns, if such fabrics are classifiable 
                        under heading 5602 or 5603 of the 
                        HTS).''.

SEC. 3106. TRADE BENEFITS UNDER THE AFRICAN GROWTH AND OPPORTUNITY ACT.

  Section 112(b) of the African Growth and Opportunity Act (19 
U.S.C. 3721(b)) is amended as follows:
          (1) Paragraph (1) is amended by amending the matter 
        preceding subparagraph (A) to read as follows:
          ``(1) Apparel articles assembled in one or more 
        beneficiary sub-saharan african countries.--Apparel 
        articles sewn or otherwise assembled in one or more 
        beneficiary sub-Saharan African countries from fabrics 
        wholly formed and cut, or from components knit-to-
        shape, in the United States from yarns wholly formed in 
        the United States, (including fabrics not formed from 
        yarns, if such fabrics are classifiable under heading 
        5602 or 5603 of the HTS and are wholly formed and cut 
        in the United States) that are--''.
          (2) Paragraph (2) is amended to read as follows:
          ``(2) Other apparel articles assembled in one or more 
        beneficiary sub-saharan african countries.--Apparel 
        articles sewn or otherwise assembled in one or more 
        beneficiary sub-Saharan African countries with thread 
        formed in the United States from fabrics wholly formed 
        in the United States and cut in one or more beneficiary 
        sub-Saharan African countries from yarns wholly formed 
        in the United States, or from components knit-to-shape 
        in the United States from yarns wholly formed in the 
        United States, or both (including fabrics not formed 
        from yarns, if such fabrics are classifiable under 
        heading 5602 or 5603 of the HTS and are wholly formed 
        in the United States).''.
          (3) Paragraph (3) is amended--
                  (A) by amending the matter preceding 
                subparagraph (A) to read as follows:
          ``(3) Apparel articles from regional fabric or 
        yarns.--Apparel articles wholly assembled in one or 
        more beneficiary sub-Saharan African countries from 
        fabric wholly formed in one or more beneficiary sub-
        Saharan African countries from yarns originating either 
        in the United States or one or more beneficiary sub-
        Saharan African countries (including fabrics not formed 
        from yarns, if such fabrics are classified under 
        heading 5602 or 5603 of the HTS and are wholly formed 
        in one or more beneficiary sub-Saharan African 
        countries), or from components knit-to-shape in one or 
        more beneficiary sub-Saharan African countries from 
        yarns originating either in the United States or one or 
        more beneficiary sub-Saharan African countries, or 
        apparel articles wholly formed on seamless knitting 
        machines in a beneficiary sub-Saharan African country 
        from yarns originating either in the United States or 
        one or more beneficiary sub-Saharan African countries, 
        subject to the following:'';
                  (B) in subparagraph (A)(ii)--
                          (i) by striking ``1.5'' and inserting 
                        ``3''; and
                          (ii) by striking ``3.5'' and 
                        inserting ``7''; and
                  (C) by amending subparagraph (B) to read as 
                follows:
                  ``(B) Special rules for lesser developed 
                countries.--
                          ``(i) In general.--Subject to 
                        subparagraph (A), preferential 
                        treatment under this paragraph shall be 
                        extended through September 30, 2004, 
                        for apparel articles wholly assembled, 
                        or knit-to-shape and wholly assembled, 
                        or both, in one or more lesser 
                        developed beneficiary sub-Saharan 
                        African countries regardless of the 
                        country of origin of the fabric or the 
                        yarn used to make such articles.
                          ``(ii) Lesser developed beneficiary 
                        sub-saharan african country.--For 
                        purposes of clause (i), the term 
                        `lesser developed beneficiary sub-
                        Saharan African country' means--
                                  ``(I) a beneficiary sub-
                                Saharan African country that 
                                had a per capita gross national 
                                product of less than $1,500 in 
                                1998, as measured by the 
                                International Bank for 
                                Reconstruction and Development;
                                  ``(II) Botswana; and
                                  ``(III) Namibia.''.
          (4) Paragraph (4)(B) is amended by striking ``18.5'' 
        and inserting ``21.5''.
          (5) Section 112(b) of such Act is further amended by 
        adding at the end the following new paragraph:
          ``(7) Apparel articles assembled in one or more 
        beneficiary sub-saharan african countries from united 
        states and beneficiary sub-saharan african country 
        components.--Apparel articles sewn or otherwise 
        assembled in one or more beneficiary sub-Saharan 
        African countries with thread formed in the United 
        States from components cut in the United States and one 
        or more beneficiary sub-Saharan African countries from 
        fabric wholly formed in the United States from yarns 
        wholly formed in the United States, or from components 
        knit-to-shape in the United States and one or more 
        beneficiary sub-Saharan African countries from yarns 
        wholly formed in the United States, or both (including 
        fabrics not formed from yarns, if such fabrics are 
        classifiable under heading 5602 or 5603 of the HTS).''.

DIVISION D--EXTENSION OF CERTAIN PREFERENTIAL TRADE TREATMENT AND OTHER 
                               PROVISIONS

SEC. 4101. EXTENSION OF GENERALIZED SYSTEM OF PREFERENCES.

  (a) Extension of Duty-Free Treatment Under System.--Section 
505 of the Trade Act of 1974 (19 U.S.C. 2465(a)) is amended by 
striking ``September 30, 2001'' and inserting ``December 31, 
2002''.
  (b) Retroactive Application for Certain Liquidations and 
Reliquidations.--
          (1) In general.--Notwithstanding section 514 of the 
        Tariff Act of 1930 or any other provision of law, and 
        subject to paragraph (2), the entry--
                  (A) of any article to which duty-free 
                treatment under title V of the Trade Act of 
                1974 would have applied if the entry had been 
                made on September 30, 2001,
                  (B) that was made after September 30, 2001, 
                and before the date of the enactment of this 
                Act, and
                  (C) to which duty-free treatment under title 
                V of that Act did not apply,
        shall be liquidated or reliquidated as free of duty, 
        and the Secretary of the Treasury shall refund any duty 
        paid with respect to such entry. As used in this 
        subsection, the term ``entry'' includes a withdrawal 
        from warehouse for consumption.
          (2) Requests.--Liquidation or reliquidation may be 
        made under paragraph (1) with respect to an entry only 
        if a request therefor is filed with the Customs 
        Service, within 180 days after the date of the 
        enactment of this Act, that contains sufficient 
        information to enable the Customs Service--
                  (A) to locate the entry; or
                  (B) to reconstruct the entry if it cannot be 
                located.

SEC. 4102. FUND FOR WTO DISPUTE SETTLEMENTS.

  (a) Establishment of Fund.--There is established in the 
Treasury a fund for the payment of settlements under this 
section.
  (b) Authority of USTR to Pay Settlements.--Amounts in the 
fund established under subsection (a) shall be available, as 
provided in appropriations Acts, only for the payment by the 
United States Trade Representative of the amount of the total 
or partial settlement of any dispute pursuant to proceedings 
under the auspices of the World Trade Organization, if--
          (1) in the case of a total or partial settlement in 
        an amount of not more than $10,000,000, the Trade 
        Representative certifies to the Secretary of the 
        Treasury that the settlement is in the best interests 
        of the United States; and
          (2) in the case of a total or partial settlement in 
        an amount of more than $10,000,000, the Trade 
        Representative certifies to the Congress that the 
        settlement is in the best interests of the United 
        States.
  (c) Appropriations.--There are authorized to be appropriated 
to the fund established under subsection (a)--
          (1) $50,000,000; and
          (2) amounts equivalent to amounts recovered by the 
        United States pursuant to the settlement of disputes 
        pursuant to proceedings under the auspices of the World 
        Trade Organization.
Amounts appropriated to the fund are authorized to remain 
available until expended.
  (c) Management of fund.--Sections 9601 and 9602(b) of the 
Internal Revenue Code of 1986 shall apply to the fund 
established under subsection (a) to the same extent as such 
provisions apply to trust funds established under subchapter A 
of chapter 98 of such Code.

SEC. 4103. PAYMENT OF DUTIES AND FEES.

  Section 505(a) of the Tariff Act of 1930 (19 U.S.C. 1505(a)) 
is amended--
          (1) in the first sentence--
                  (A) by striking ``Unless the merchandise'' 
                and inserting ``Unless the entry of merchandise 
                is covered by an import activity summary 
                statement, or the merchandise''; and
                  (B) by inserting after ``by regulation'' the 
                following: ``(but not to exceed 10 working days 
                after entry or release, whichever occurs 
                first)''; and
          (2) by striking the second and third sentences and 
        inserting the following: ``If an import activity 
        summary statement is filed, the importer or record 
        shall deposit estimated duties and fees for entries of 
        merchandise covered by the import activity summary 
        statement no later than the 15th day of the month 
        following the month in which the merchandise is entered 
        or released, whichever occurs first.''.